Annual report for Mineral Lease 24510 Tiwi Islands Northern Territory for period ending 6 September 2006

Abstract

This annual report covers ML 24510 (Andranangoo Creek West) situated on the north coast of Melville Island part of the Tiwi Islands in the Northern Territory. In 2005 prior to granting of the Mineral Lease, considerable exploration including air core drilling had been completed on the original tenement (EL 23862) enabling Ore Reserve estimates to be completed for Andranangoo Creek West where Proven reserves are now 2.68 MT at 3.6% heavy minerals using a 1% cutoff. The heavy mineral deposits of Andranangoo Creek West are dominated by a relatively high zircon and rutile content, low slimes (average 1.2%) and no overburden, i.e. they occur at surface down to approximately 3m depth. Exploration completed on the Mineral Lease between 7 September 2005 and 6 September 2006 comprised augering, costeaning, analytical work, mineralogy, bulk sampling and metallurgical testwork, surveying, and ore reserve estimation.