Annual report on EL 25291 13 February 2008 to 12 February 2009

Abstract

This annual report outlines exploration activities undertaken by North Australian Diamonds Limited on EL 25291 between the 13 February 2008 and the 12 February 2009. This period represents year two of the license. EL 25291 is situated on the Walhallow 1:250,000 geological mapsheet and the Lancewood 1:100,000 topographic mapsheet in the Batten Region of the Northern Territory. It is located approximately 120 kilometres south of Borroloola and is accessed via existing unsealed tracks leading north from Kiana Station. Previous exploration north of the licence has recovered large numbers of commercial size diamonds and kimberlitic chromites within major drainages. The headwaters and tributaries of some of these drainages drain a large plateau that occurs within the licence area. It is possible that a primary source (ie kimberlite) for the diamonds exists on the plateau thus increasing the prospectivity of the licence. Field work completed during the reporting period included geological reconnaissance of historic positive sample sites and inspection of major drainages for suitable bulk stream gravel sampling sites. The potential of the licence to host uranium mineralization was assessed by internal staff and external consultants. The uranium exploration potential of the licence is based largely on whether Westmoreland Conglomerate and/or Seigal Volcanics occur within the licence beneath the Bukalara Sandstone. To the west of the Emu Fault (ie area that includes the licence area), which is made up of a number of splay faults within the licences, there may be volcanics present beneath the Bukalara sandstones. The geology is complex with faulting and tilting of blocks and drilling will be required to determine whether these volcanics are present and represent the Seigal Volcanics or most probably Settlement Creek Volcanics. Field work completed during the reporting period included geological reconnaissance of historic positive sample sites and inspection of major drainages for suitable bulk stream gravel sampling sites. The potential of the licence to host mineralisation other than diamonds and uranium was assessed by Jigsaw Geological Consultants.