Annual report for EL 25339 Douglas Range Project 17 January 2008 to 16 January 2009

Abstract

EL 25339 was granted to Whitvista Pty Ltd on behalf of Australian Uranium Ltd on 17th January 2007. The EL consists of 141 sub-blocks of approximately 471.6 square kilometres. Yellow Rock Resources Limited held 25% of Australian Uranium Ltd at the time of IPO. Yellow Rock Resources limited is the operating partner of the licence. EL 25339 is shown on the geology map below. The Mary River and McKinley River flood plain system divides the EL into two operational units from an exploration and access perspective. Access to the northern part of the EL is through tracks off the Arnhem Highway. The access to the southern portion of the EL is restricted by relief of the Mt Douglas area and the Douglas Range, but access can be gained through tracks from the Pine Creek area several tens of kilometres to the south. The tenement is situated on the eastern side of the Pine Creek Geosyncline, a group of Palaeo-Proterozoic sediments and metamorphic rocks which have undergone deformation and are known to host gold, base metal and uranium mineralization. The age of the sequence (from NTGS information) is said to vary from early Palaeo-Proterozoic to almost Meso-proterozoic (1800 million years ago to 2100 million years ago) of the Pine Creek region. The Pine Creek sequence is known to contain sandstones, siltstones and shales of the Kombolgie formation and the Mt Partridge Group as well as schists and igneous rocks of the older basement group. Some of the younger mudstones, shales and siltstones of the Palaeozoic and Mesozoic platform cover rocks are occasionally seen as scattered outcrops lying unconformably above the Proterozoic rocks. The Proterozoic sediments, intrusives and volcanics and their associated unconformities are known to be suitable host sites for uranium mineralization. Field work on the tenement has indicated that the northern portion is occupied by the Quaternary and Recent fluviatile and lacustrine clays, silts and mixed facies associated with the Mary River and McKinley River catchments. This water system drains a large area of hinterland to the south, with the sediment provenance mainly from the Pine Creek Geosyncline rocks. The laterite profile is a good provenance for uranium and base metal enrichment within the groundwater or hydrologic circulation. The laterite profile is variously developed in the northern area and is resistant to erosion, creating low-lying mounds or rises as remnants of the once extensive oxidation. The area has had good reconnaissance exploration coverage from the Bureau of Mineral Resources (BMR) and WMC Corporation Ltd, Exploration Division in the mid 1980's, followed by Carpentaria Gold Pty Ltd and Northern Territory Gold Mines NL in the early1990's. However, this work concentrated mainly on gold and there was only token work on base metals and uranium. There are several known mineral occurrences close to the lease for vein-hosted gold, base metals and tin and these have been the focus of prospecting and exploration activity throughout the history of the Pine Creek Goldfield. During the 2007 August fieldwork campaign at Douglas Range Project significant uranium anomalies were identified in the McKinley, Central and South-East grid areas. Exploration work conducted on the Douglas Range Project during the period ending 16th January 2009 included Airborne Radiometric and Magnetic Survey by GPX, Airborne review of regional NTGS geophysics and a review of geological and exploration data. GPX Airborne Services completed a grid survey of Air Magnetics and Radiometrics over the lease in August 2008. This was completed at a line spacing of 100m and a flying height of 60m. A total of 3,914.7 line kilometres of measurements were recorded for the southern portion of the tenement. Magnetic images were recoded as RTP (Reduced To Pole), TMI (Total Magnetic Intensity) and computer enhanced for Ist Order Vertical Derivative as well as for colour contouring and shadow orientation algorithms. Separate radiometric images for potassium, thorium, uranium and total count were recorded as were the spot heights for a Digital Elevation Model for the area. Exploration activities completed to date indicate that the ground scintillometer measurements carried out in the Douglas Range tenement have confirmed the presence of several significant uranium anomalies. Follow up GPX airborne surveys at 100m spacing have also identified other anomalies requiring 'ground-truthing' in the field. These are to be investigated during the next field season. YRR is planning further substrate testing of the Central and South-East areas with a detailed sampling program to evaluate the bedrock geology, geochemistry and uranium potential.