Annual exploration report for MCN 3705, MCN 3706, MCN 3707 and MLN 1103 for the period ending 30 April 2007 Woolwonga Group, Burnside Project

Abstract

The Woolwonga tenement group is located about 130 km SE of Darwin, NT and 16 km NE of the Brocks Creek mine. It covers the Woolwonga gold mine which is situated within the historical gold mining field. GBS Gold Australia Pty Ltd acquired the tenements in 2005 through a subsidiary Northern Gold Limited. Gold mineralisation at Woolwonga is associated with quartz-sulphide veins which fill faults and fractures set in Mt Bonnie Formation. Mineralisation and historic workings on vein outcrops occurred over the full length of the original Main Ridge, and colluvial shedding from this extended for 500m SE of the ridge and was worked extensively by Chinese workers from the late 1880's to early in the 20th century. The gold is controlled by three main structural features such as the axial zone of the Woolwonga Anticline, SE dipping fracture zones and competency contrast sites. Following extensive exploratory drilling and a feasibility study by the Dominion Mining, the company estimated a recoverable mining reserve of 2.1Mt @ 2.78g Au/t. Northern Gold NL acquired the tenements from Dominion following completion of the mining phase and rehabilitation of the mine site. During the reporting period, 9 RC drill holes for 980 metres were drilled to test the presence of gold mineralisation towards southeast of the present pit (Empire Prospect). Axial zone of SE plunging anticline was targeted for further extension of gold mineralisation of the Woolwonga deposit located on MLN 1103. Target geology of quartz, pyrite and arsenopyrite was intercepted. A total of 956 chip samples were collected (1 metre composite) and analysed for Au. In some drillholes significant gold mineralisation was intersected.