Annual exploration report EL 10347 Golden Dyke Dome, for period ending 14th April 2006

Abstract

EL 10347 is located 145km SE of Darwin, NT and 7km ENE of Hayes Creek roadhouse. The tenement is centred on the Golden Dyke Dome, a faulted anticlinal feature at the southern end of the historic Yam Creek-Golden Dyke gold-mineralised belt. Several historic gold mines occur within the tenement including Golden Dyke, Davies No 2, Fishers Adit, Afghans Gully and Langley's. Modern exploration work at Golden Dyke Dome commenced in the 1970s and comprised intensive programs of geological mapping, costeaning, stream sampling, soil sampling diamond drilling and RC drilling. This work outlined open pit gold resources that were mined in 1984 by Henry and Walker. They mined a total of 295,000t of ore at 4.0g Au/t from four pits and treated the ore at the Mt Bonnie plant. Subsequent reviews indicated that some residual gold mineralisation was present. Northern Gold NL acquired the area from Dominion Mining in the mid 1990s, conducted extensive technical reviews and did rehabilitation work in the vicinity of the Golden Dyke open pit. In April 2002 Territory Goldfields NL (Northern Gold NL) entered into a joint venture agreement with Buffalo Creek Mines NL ('Burnside JV') that included a schedule of tenements and mining assets within a 30km radius of the Brocks Creek treatment plant. A ranking and review of the joint venture ground indicated that EL10347 is in a geologically favourable area for gold mineralisation but the more valuable oxide component of the known deposits had been mined out. Indications are the remaining resources are numerous but small and of modest grade. In August 2004 the joint venture purchased the Union Reefs gold treatment plant and sold the Brocks Creek mill to Tanami Gold NL. This purchase changed the economic framework of gold deposits in the Burnside region. GBS Gold made a successful takeover of Northern Gold NL during 2005, and entered into an agreement to purchase Harmony Gold's 50% share of the JV. Since April 2006, GBS now have 100% ownership of the Burnside Project. Golden Dyke now has a more favourable ranking as GBS Gold is investigating the capability of treating refractory ore at the Union Reefs plant. Further work is planned to delineate the resource under the pits, with an estimated expenditure for the next year of $15,000.