Annual exploration report EL 24405 for the period ending 5 May 2009 Yam Creek West, Burnside Project

Abstract

EL 24405 is located about 170 km SE of Darwin within central part of the Pine Creek Orogen, a known gold-rich region which has produced significant quantities of gold for the last 140 years. The tenement was granted to Buffalo Creek Mines Pty Ltd (50%) and Territory Goldfields NL (50%) which was part of the Burnside JV. In April 2006, GBS Gold Australia Pty Ltd acquired 100% of the Burnside JV. The tenement lies west of the Princess Louise gold deposit and Iron Blow base metal deposit near Yam Creek. There is poor outcrop within the tenement, but mapping by AGSO and NTGS shows the area being underlain by Burrell Creek Formation of the Finniss River Group. The strike of the Burrell Creek sediments within the tenement is unclear due to lack of outcrop, but may trend to the northeast. TMI imagery shows a strong NW component that may be NW-trending fracture sets that could control mineralisation. Exploration activity during the reporting period ended on 5 May 2009 was confined to a review of the tenement, which supported the contention of favourable structural site for gold mineralisation present in the project area. According to this interpretation, the tenement covers the area which appears to be hydrothermal fluid conduits that have been derived from Burnside Granite. Similar type of fluids conduits may have been responsible for gold mineralisation at Fountain Head and newly discovered Tally Ho deposits. In 2009-10 reporting year, project area will be explored for gold, uranium and base metals mineralisation. For this purpose, area identified during this review will undergo soil/rock chip sampling along with geological mapping. If encouraging results received, some RAB/RC drilling may also take place.