Annual exploration report ERL 89 Big Howley year ending 18 September 2003

Abstract

ERL 89 is located 130km SSE of Darwin, NT, and 5km NW of the Cosmopolitan Howley Gold Mine. It covers a sector of the Howley Anticline, a complex regional northwest trending structure which hosts a number of important gold deposits, including the Chinese Howley and Big Howley deposits, and the major Cosmo Howley deposit. Previous exploration by Northern Gold N.L. comprised geochemical sampling and RC drilling. The work concentrated on the South Ridge Prospect, a 2km long mineralised zone coincident with the Howley Anticlinal structure. An inferred resource of 204,000t at 2.4 g/t Au was estimated at South Ridge by Northern Gold N.L. In April 2002 Territory Goldfields NL and Buffalo Creek Mines NL entered into a joint venture that merged certain tenement assets within a 30km radius of the gold treatment plant at Brocks Creek and included ERL 89. The jointly managed treatment plant is planned for refurbishment in order to commence treatment of gold ores from the Zapopan underground mine. The joint venture under the management of Burnside Operations P/L plans to develop, mine and treat all economically viable gold deposits in the Burnside region. The resource at South Ridge will be continually assessed in this context, however at this stage it is regarded as having a lower priority ranking. In mid 2003, the Joint Venture elected to suspend exploration work in the Burnside region pending a turn around in economic factors. In addition time was required to fully evaluate the recently developed Zapopan deposit and the results from treating the development ore at Union Reef. ERL 89 will continue to be subjected to technical review and ranked against other deposits in the region.