Mount Peake Project Annual report 22 July 2007 to 21 July 2008 EL 23074

Abstract

Exploration Licence 23074 was granted to Tennant Creek Gold (NT) Pty Ltd (TCG) on the 22/07/2002. TCG is a wholly owned subsidiary of TNG Ltd. On 29 May 2007, TCG transferred the licence ownership to Enigma Mining Ltd, another wholly owned subsidiary of TNG Ltd. In April 2008 Enigma Mining Ltd applied for a 2 year renewal of the licence. This was approved by the department on 5 June 2008. All reference to work by TNG Ltd. Or its subsidiaries will be referenced as 'TNG' in this report. TNG originally applied for the licence area to explore for Ni-Sulphides, and it forms part of the companies 'Mount Peake' Project area together with EL23271. On the 18th August 2003 'TNG' entered into a Joint Venture agreement with Falconbridge (Australia) Pty Ltd allowing them to earn a 60% interest. On the 15th October 2003 Falconbridge (Australia) Pty Ltd entered into a Heads of Agreement with Discovery Nickel Limited (DNL) whereby DNL assumed Falconbridge's obligations for EL23074. TNG resumed management of the tenement in October 2006 following the failure of the joint venture partners to fulfill its exploration, rent and reporting obligations. Assessment of geophysical data collected by the JV partners revealed that one Diamond Drill Hole, ARD02 had been drilled into a large magnetic anomaly targeting an EM target at 200m depth. The hole was stopped at 150.6m having intersected magnetite rich gabbro from 30m. Inspection of the core by TNG revealed that the core had not been cut or assayed. TNG submitted the core for assay and results show high concentrations of vanadium (V2O5) > 0.5% and titanium (TiO2) > 8% in the magnetite grading > 35% Iron (Fe). Davis Tube Recovery test work has since been completed providing significant encouragement in both recovery of > 65% and upgrades to potential commercial grades of > 1% V2O5, 17% TiO2, 55% Fe. Further drilling is planned to evaluate the prospect during the next year.