Annual exploration report for EL 23432 Hayes Creek North, for the period ending 8 May 2006

Abstract

EL 23432 is located 140 km SE of Darwin, NT and 3 km north of Hayes Creek roadhouse on the Stuart Highway. The tenement was granted to the Burnside Joint Venture, managed by Burnside Operations P/L comprising Territory Goldfields NL and Buffalo Creek Mines NL. The latter were subsidiaries of Northern Gold NL and Harmony Gold (Australia) P/L respectively. In 2005 GBS Gold made a successful takeover of Northern Gold NL, and acquired Harmony's 50% share of the Burnside JV. By April 2006, GBS Gold had 100% of the Burnside project. This is the third year following grant of the licence. Three of the six blocks were nominated for surrender before the anniversary of year two. Work on EL 23432 has been subordinate to activity on other JV tenements as the emphasis has been on establishing gold resources at established mineralised prospects. Expenditure during 2005-06 was related to conducting a literature and geochemical data review and reporting. During the coming year reconnaissance is expected to resolve the prospectivity of the remaining northern blocks.