Annual report for the year ended 16 February 2008

Abstract

The Arunta Project is located approximately 250km NNW of Alice Springs in the Northern Territory. The North Arunta Province is dominated by a series of sulphidic Palaeoproterozoic sedimentary sequences intruded by granite plutons and mafic sills. Quaternary and Tertiary cover conceals large areas of bedrock in the area however the region has seen exploration for a variety of commodities including gold, base metals, iron ore, uranium and diamonds. Modern exploration in the project area includes a variety of exploration methods dominated by geophysics such as airborne magnetic, radiometric and GEOTEM surveys in conjunction with surface sampling and limited percussion drilling. Exploration completed during the current reporting period has involved the acquisition of a further moving-loop EM survey the results of which identified a new conductive anomaly 200m along strike from B1. Thirteen east-west oriented lines for 39.6 line km were completed on a 400m line spacing. The target was generated from a moving-loop electromagnetic anomaly focused on the historical drill hole ARD 001. ARD 001 was drilled in 2004 and targeted on a previously defined GEOTEM anomaly. Diamond hole ARD 001 completed in 2004 by Discovery was drilled to a depth of 314.4m, and intersected two intervals 25m and 17m thick of graphitic biotite schist with up to 15% strata bound, disseminated pyrrhotite and pyrite mineralisation. Importantly elevated base metals were detected (up to 694 ppm Zn and 358 ppm Pb) and trace chalcopyrite and sphalerite were observed in core. The host lithology is interpreted to represent pelites of the Lander Rock Beds. Petrological investigations of mineralised samples from ARD 001 completed in 2004 by Discovery suggest the mineralisation has been remobilised during a post-tectonic static metamorphic event. The new target is 212m to the north east of the historical hole and is a stronger conductor with a better time constant than the original anomaly drilled in 2004.