Annual exploration report for EL 24403 Mt Douglas, for period ending 7 September 2006

Abstract

No work was completed for the year as the formal agreement between the parties, Orridge, Pinniger, Teelow and Terra Gold Mining Pty Ltd, a subsidiary of GBS Gold Australia Pty Ltd, (GBS) has not been signed by all parties. The main causal factor being one of the parties, Pinniger is unable to be located and therefore is unable to sign and complete the legal documentation. Numerous efforts have been made to locate Pinniger with little success. Discussions between DPIFM and GBS to determine the best way forward to enable exploration activities to be undertaken have also been progressed. GBS rank this tenement highly prospective and are very keen to commence exploration activities. This is contingent to completing an agreement with the above mentioned parties. Discussion between the other two parties, ie Teelow and Orridge are ongoing to determine the best solution to enable exploration to progress for the following year, in 2007. GBS is willing and supportive for a positive outcome to commence exploration as soon as practicable. EL 24403 surrounds EL 23532 Ringwood, Ringwood North and South Ringwood workings that comprise small shafts and pits over a 6km length. The structural deformation and ideal host rocks make this location a highly prospective tenement which will add value and mine life to the GBS resource inventory.