Annual exploration report on ERL 89 Big Howley, year ending 18 September 2004

Abstract

ERL 89 is located 130 km SSE of Darwin, NT, and 5 km 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 2 km long mineralised zone coincident with the Howley Anticlinal structure and along strike from the Big Howley open pit. An inferred resource of 204,000 t at 2.4 grams per tonne Au was estimated at South Ridge by Northern Gold N.L and an ERL was applied for to protect the then sub economic resource. In April 2002 Territory Goldfields NL and Buffalo Creek Mines NL entered into a joint venture that merged certain tenement assets within a 30 km radius of the gold treatment plant at Brocks Creek and included ERL 89. In August 2004 the joint venture negotiated the sale of the Brocks Creek mill to Tanami Gold NL and simultaneously purchased the mill at Union Reefs in a dealing with AngloGold (Ashanti). At a rated 2.4 Mt per annum, the Union Reefs mill is larger than the original Brocks Creek facility and can more economically treat lower grade gold ores. It also requires very little lead time before start up. In the light of this new acquisition, the resource at South Ridge within ERL 89 will be re-assessed along with many other gold deposits in the Burnside region for possible mining and trucking to Union Reefs.