Annual exploration report for EL 23541 Howley East, year ending 16 February 2007

Abstract

EL 23541 is located 130 km SE of Darwin, NT and 5 km west of Brocks Creek siding on the Darwin-Adelaide railway. The tenement is subject to the Burnside Joint Venture, managed by Burnside Operations P/L comprising Territory Goldfields NL and Buffalo Creek Mines NL. GBS Gold Australia Pty Ltd now have 100% ownership of the Burnside Joint Venture. The EL encompasses a suite of meta-sedimentary rocks that are part of the Pine Creek Orogen sequence and lies between the gold mining centres of Brocks Creek and Cosmo Howley. The joint venture has been actively exploring the Burnside region since its formation on 4th April 2002. Work to date has been focused on establishing gold resources from number of deposits and mining commenced in August 2006 from Brocks Creek, Rising Tide and Fountain Head to supply ore feed to the Union Reefs mill. Work on EL 23541 has been subordinate to activity on other JV tenements as the emphasis has been on re-commissioning the Union Reefs mill in August 2006, and mining activity at several gold deposits. During the reporting period, a technical review of the available information was undertaken, in addition to a reconnaissance visit of EL to assess the potential of the area. In terms of proposed exploration program for next year, work will continue on integrating and validating the historic geochemical and drilling database covering the regional Burnside JV tenements. There is a possibility that surrounding SEL 24352 work program being extended into EL 23541, which will be subjected to a significant exploration activity. This will lead to soil sampling and possible RC drilling.