Relinquishment report on blocks relinquished at the conclusion of year 4 of tenure 19 August 2006 to 18 August 2007 EL 23771 Cox River West

Abstract

During the first year of tenure, on the basis of encouraging diamond sampling data from nearby tenements, a Falcon(r) airborne gravity gradiometer survey was flown over a substantial part of the Mt Young tenement and also over neighbouring tenements. Detailed interpretation, anomaly ranking and exploration targeting from the Falcon survey by Gravity Diamonds was completed during 2004. No priority targets were identified within EL 23771 but targets in adjacent EL's currently being explored by Gravity were rated highly with the possibility of kimberlite pipes or alluvial diamonds occurring on EL 23771 being highlighted. Gravity Capital Limited changed its name to Gravity Diamonds Limited in October 2004 to reflect its exclusive focus on diamond exploration. During 2005, helicopter-supported heavy mineral sampling was carried out on ELs adjacent to EL 23771 focused on priority Falcon(r) target areas. Field reconnaissance was carried out at this time on EL 23771 but no appropriate sample sites were located. Exploration in the district during 2006 and 2007 was delayed by an extraordinarily late wet season. During late 2006 the original Falcon gravity data was reprocessed by BHPB Falcon operation with updated noise suppression algorithms that lowered the noise in the original data set from approximately 10 Eotvos to 3 Eotvos. Small kimberlites discovered by Gravity Diamond at Abner Range had a negative gravity response of 22 Eotvos. There were four (4) blocks relinquished from EL 23771 at the conclusion of Year 4 comprising the three (3) northern blocks and the southern block.