EL 22961 Litchfield Project, First annual report for the period ended 10 July 2004

Abstract

This first annual report summarises all exploration work conducted by Discovery Nickel Ltd (DNL) on EL 22961 for the annual period ended 10 July 2004. The tenement area lies in the western parts of the Pine Creek Inlier (Litchfield Province) and is considered to have excellent potential for magmatic Cu-Ni mineralisation related to the Proterozoic Wangi Basics. The Litchfield Province is the continuation of the prospective Halls Creek Province of the Kimberley's, a known significant magmatic Cu-Ni province (e.g. Sally Malay Deposit). Exploration work completed to date includes: - review and compilation of open file reports, published literature and data; - interpretation of the aeromagnetic, gravity and landsat data; - designing the boundaries of a Geotem Survey - designing a soil sampling program; - planning for the 2004 field season. The exploration work on EL 22961 has not advanced as fast as intended due to delays in gaining the relevant statutory permits, and due to the short field season that applies to this part of northern Australia. The review and interpretation work confirmed the high prospectivity of the tenement area for magmatic Cu-Ni mineralisation related to the Wangi Basics, and that there are undercover extensions to the mafic/ultramafic rocks along strike from the known occurrences. A program of airborne EM and soil sampling is currently being planned to cover the known/interpreted mafic/ultramafic intrusions and the broad structural corridors that contain them. This work will be undertaken next period. The highest priority targets will be flagged for ground EM and drill testing.