Annual exploration report for the Howley Ridge Tenement Group, period ending 31 March 2006

Abstract

The Howley Ridge mineral claims are located 130km SSE of Darwin, NT and 8km NW of the Cosmopolitan Howley Mine in the Burnside region of the Pine Creek Geosyncline. The tenements occupy a segment of the axis of the Howley Anticline. Northern Gold N.L. has completed many individual phases of exploration over the tenements, and the Howley Ridge tenements are at a mature stage of exploration. In 2002 Northern Gold NL subsidiary, Territory Goldfields NL, entered into a joint venture with Buffalo Creek Mines P/L, creating the Burnside JV. The Burnside JV reviewed the Howley Ridge tenements and concluded that while local very high grades occur, there is apparently insufficient grade continuity to readily proceed to mining. As a consequence recent activity has been confined to data reviews and reporting. In 2005, GBS made a successful takeover of Northern Gold, and entered an agreement to purchase Harmony's 50% share of the Burnside JV, giving GBS 100% of the project. The resource at Howley Ridge requires further modelling and economic study to determine whether it can contribute ore feed in any renewal of development of the Burnside gold deposits.