Annual exploration report for EL 23174 Au Quest Project year ending 18 September 2008

Abstract

EL 23174 is situated 80km East of Darwin NT and 3.5 km north of the Toms Gully Mine along the Arnhem Highway. On 25 July 2007, GBS Gold Australia Pty Ltd acquired all tenements and Toms Gully gold mine held by Renison Consolidated Mines NL, including EL 23174 in Toms Gully area, Northern Territory. EL 23174 is located within the Pine Creek Orogen, which has been interpreted as an intra-cratonic basin lying on an Archaean basement, and containing 14 km thick sequence of Proterozoic sediments, accompanied by lesser volcanics, granitic plutons and dolerite intrusions. In the tenement area rocks of the Mount Partridge Group, South Alligator Group and Finniss River Group are exposed.During the reporting period GBS Gold Australia undertook a peripheral review of the tenement and negotiated uranium exploration agreement with Rum Jungle Uranium Limited. The project area has been flown for high resolution aerial geophysical survey. This data is still in its raw format at this time and is currently being processed in a usable format for future target generation. In addition, high resolution remote sensing cover for the tenement has also been acquired, which will assist in planning and at development stage. Other exploration activities during the reporting included reconnaissance visit, data review, report writing and Tenement administration. Planned exploration for EL 23174 will involve processing of the newly acquired aerial geophysics which will include Radiometric and magnetic data, and assessing the data for future targets. This will involve a gold and base metal approach from GBS and a uranium angle for Rum Jungle Uranium Limited. In-depth technical review of EL 23174 is already underway to assess the full potential of the area. Target generation stage will lead to RC/RAB drilling