Annual exploration report Caroline Group Union Reefs Project year ending 4 November 2007 MLN51 - MLN 57 inclusive

Abstract

The Caroline Group tenements (MLN 51-MLN 57) are situated 170km SE of Darwin, Northern Territory, and 8km north of Pine Creek. The group of tenements is only 4km south of the Union Reefs mill and has not yet been the subject of modern open pit or underground mining operations. The Caroline tenements were initially the subject of a base metals search in the late 1960s. Subsequent soil and costeaning work by Aztec Resources showed gold and arsenic anomalism occurred adjacent to a zone of historic shallow base metal workings. Acacia Resources Limited explored the area in the 1990s. Exploratory RC drilling located narrow but significant gold intercepts towards the southern end of the group, adjacent to a regionally significant but barren dolerite dyke. During the reporting period a technical review of the Caroline Group of tenement was undertaken in addition to report preparation, reconnaissance visit, administrative duties, and planning for the next field season. Technical review shows that these tenements are located in one of the most prospective regions in the Pine Creek Orogen. Previous geological studies and exploration programs have established the prospectivity of this area for gold and base metal mineralisation. In the next year, the Caroline Group tenements will undergo in-depth technical review in order to assess full mineral potential of the area. A major soil sampling has been planned for next year over GBS tenement holding and that will flow into the Caroline Group of tenements. It is also possible some geophysical assessment of the area will also take place and if some encouraging results received, will lead to limited drilling.