AC 74 Kurinelli annual report year ending 21 July 2008

Abstract

The Kurinelli goldfield is situated in the northeast Davenport Province in the central part of Northern Territory, 140 kilometres southeast of Tennant Creek. Gold mineralisation was discovered in the area over 100 years ago in 1898 by prospector/explorer Davidson (Davidson, 1905) but the region has been subjected to only limited, spasmodic attention since that time. Current activity by local prospectors in the area is directed towards recovery of gold nuggets from shallow alluvial and colluvial deposits using metal detectors. Several hundred to several thousand ounces of gold are estimated to have been recovered in this way over the past 10-20 years. Historical activity centred on gold mineralisation within quartz veins which characteristically occur within interbedded sandstone/siltstone (Rooneys Formation) and conformable gabbro/dolerite. The two main mines were the Kurinelli Mine (former MCC59) and the Dempsey's Choice Mine (MCC191). Historical production was about 400 ounces of gold. The central part of the field covers an area of 8 x 20 kilometres. More scattered mineralisation is recorded in similar host rocks over an area in excess of 20 x 30 kilometres. The units which host the mineralisation also occur elsewhere in the Davenport Province. Despite the presence of outcropping gold mineralisation, the Kurinelli goldfield has never been subjected to systematic exploration using modern geophysical and geochemical exploration methods developed in the past 10-15 years. Of particular importance is the fact that the area received little attention in the BLEG 'gold rush' of the 1980's though it may have been covered in Australia-wide open range exploration of this type by one multi-national group. This lack of activity over the past two decades can be attributed to a combination of factors which included: the subdued nature of the topography, the arid climate and a widespread thin cover of aeolian sand, fragmented exploration title over the area prior to 1994, a Reserve From Exploration (RE) over the entire field between 1994 and 1996 where title could only be held as mineral claims and mining leases (which resulted in even more fragmentation of ownership), a Reserve from Occupation (RO) between 1996-2004, where no form of mining or exploration tenure could be applied for or granted; and uncertainty in mining and exploration tenure in the Northern Territory especially between 1996-2002 because of the ramifications of the Native Title Act. Although many companies have held tenure in the Davenport Province in the past, most work has been superficial, and drilling is notable for its almost total absence away from the old mining centre at Hatches Creek, which is about 20-30 kilometres south of the Kurinelli field. Current interest in the area stems from the discovery in mid-late 1996 of highly elevated levels of nickel, platinum, palladium and gold in magnetic ironstone boulders which had been recovered by local gold miners. The boulders, which were up to 200 millimetres in diameter, were located by the use of metal detectors being employed by the local miners to find nugget gold in surficial deposits. After an initial burst of excitement when a multitude of mineral claims were pegged by the local operators and smaller exploration companies, a suggestion arose that the ironstone boulders, rather than being nickeliferous gossan as had first been thought, were fragments of an iron meteorite. This idea gained some support from semi-formal reports mainly from academics at tertiary institutions and curators at museums. However, as acid-etching of specimens of Kurinelli ironstones revealed breccia and vein textures which seemed totally inconsistent with an extra-terrestrial origin for the ironstones, McCleary Investments Pty Ltd (MIPL, a predecessor of Arafura Resources) commissioned additional scientific studies to resolve the question of the origin of the boulders. Investigations undertaken by MIPL were documented by Goulevitch (1997) and comprised: acid-etching of ironstones; conventional and ICP-MS/OES analyses of several ironstones; petrographic studies of polished sections from four ironstone boulders by reputable consultants; laser-ablation ICP-MS analyses on the polished sections; petrological review and description of doleritic and gabbroic rocks from the Kurinelli area; reconnaissance soil and lag sampling in the vicinity of the discovery, in particular within areas which had been pegged by MIPL and its associates; review of the regional geology and of aeromagnetic data from the region; and a search for relevant data in the open file company reports from previous exploration in the area. Most of the investigations on the ironstones proved inconclusive but finally, in 1999, acid etching of ironstones provided by local occupant, Mr Colin Wessels, revealed unmistakeable triangular (octahedral) widmanstatten texture which is a diagnostic indicator of massive iron of meteoritic origin. Despite this set back, the Kurinelli ironstones drew attention to the under-explored gold potential in the area and this became the main focus of attention of Arafura Resources as early as 1997. At that time, the NT Government, having already imposed an RO over the area in response to the intensive pegging activity in late 1996, called for expressions of interest from parties interested in undertaking more systematic and professional exploration over the central Kurinelli area and its immediate surrounds. Arafura's application was successful but it would be another 7 years before Native Title and other tenure issues were resolved and Authority C74 granted in mid-2004. Arafura immediately embarked on a programme of regional geochemical soil sampling. Initial results from the programme confirmed gold potential in the area and follow-up infill sampling was required to confirm the nature of gold anomalism. The results from the first year of exploration activities were reported by Goulevitch (2005). The results of follow-up more detailed systematic soil sampling programmes were reported in Hussey (2006). The gold anomalism thus identified, an RC drill testing program was conducted in May - June 2006 to determine the relationship of the anomaly to the underlying bedrock. Results proved that the majority of geochemical anomaly is located above low levels of gold mineralisation within the bedrock. There where no economically significant intersections of gold mineralisation identified by this drill program. In July - August 2007 an additional soil sampling program occurred 1km to the NE of 2006 RC drilling. 2635 samples at an infill grid of 25 x 50m were collected over an anomaly identified in earlier Phase 1 and 2 sampling. Results of this program are reported here in full. A total of 2635 infill soil samples where collected over an anomaly identified during previous Phase 1 and 2 soil sampling programs. The 25 x 50m grid was located 1km to the NE of 2006 RC drilling area. This round of soil sampling (Phase 2E) was completed to better constrain previously identified anomalies and to generate new exploration targets. All sampling was located within the boundaries of previous soil sampling programs, with no samples being collected from within exclusion zones around Aboriginal sacred sites advised by the Central Land Council. No samples were collected from within granted mineral claims, and priority applications for mineral claims, held by unrelated parties without their permission. Results of Phase 2E indicated a NE trending band of anomalous results along a strike length of 2km. Highest average gold-in-soil assay was 2.51ppm Au; 16 sample sites returned average gold-in-soil assays >100 ppb Au; about 20% of sample sites produced anomalous results (>10ppb Au). The soil sampling program better constrained the previously identified geochemical anomaly, with some elevated Au results returned. Overall the geochemically sampling program served its purpose, further defining the known extent of a gold-in-soil anomaly refining target areas for follow-up evaluation and exploration.