Annual exploration report Brocks Creek Group year ending 26 June 2008 MLN 1139, MLN 176, MCN 4689 to 4697, MCN 4701 to 4703, MCN 4863 to 4871 and MCN 4895 to 4899

Abstract

The Brocks Creek Project is located in the central part of the Pine Creek Orogen and is one of the main gold producing areas in the Northern Territory. It comprises a group of mining tenements centered about 140 km south east of Darwin, NT. Brocks Creek has historically been the focus of open pit, underground and alluvial gold mining area and has produced significant quantities of gold along the Brocks Creek-Zapopan (BKZ) structure. GBS Gold Australia Pty Ltd acquired the project area on 1st April 2006. The project area comprises a sequence of Palaeoproterozoic meta-sedimentary rocks of the South Alligator Group and Finniss River Group, intruded by the Burnside Granite. This rock sequence has been tightly folded on axes that trend north westerly, and have been subjected to greenschist facies metamorphism. Thermal effects from the late-orogenic Burnside Granite that lies to the north of the group has imparted hornfelsing and porphyroblastic spotting of garnet, biotite and andalusite/cordierite depending on lithology and proximity to the contact. During the reporting year, 21 diamond holes for a total of 2758 meters were drilled to generate new resource model for mining. All holes were drilled through an underground drill access drive, from where they formed a fan shape pattern. This drilling program was undertaken at the 870 level about 225 metres below surface with the objective of testing for depth extensions of main lode, in particular, deeper levels in the central lode. A total of 656 samples were retrieved and assayed for Au. Drilling from underground within the Brocks Creek underground mine has indicated depth extensions to both the main and central lodes of the ore body. In particular, the central lode of the ore body is increasing at depth in strike length, average grade and true width. Drilling program undertaken during 2007-08 indicates that significant resource of gold mineralisation is present at depth. With further drilling this resource can be defined and add value to mine economics. In the next reporting year, additional diamond drilling and assaying is planned to extend resource base further at Brocks Creek.