Annual report ERL 148 Batchelor for the year ended 25 November 2009

Abstract

Compass Resources Limited was placed in voluntary administration in January 2009 and then placed under a deed of company arrangement from 1 May 2009 for a period of 12 months. Under the terms of the JV agreement between Compass Resources Limited and HNC, a wholly owned subsidiary of HNC, named HNC (Australia) Resources Pty Ltd (HAR) will continue exploration activities in 2009/2010 on the tenement. The Area 55 and Area 55 West prospects are the main areas of interest within ERL 148. The two prospects straddle these and other Compass Resources Pty Ltd held tenements ERL 125 and MLN 1161 to the north and north-west; work completed outside ERL 148 is reported in those respective annual reports. The prospectivity of ERL 148 is similar to that of other tenements within the Rum Jungle Mineral Field, with copper, lead, zinc, cobalt, nickel and uranium being the main minerals sought. Considerable work, including drilling since the 1950's, has been carried out within the Area 55 and Area 55 West prospects. Work undertaken during this reporting year included a complete review of the geology and controls on mineralisation at Area 55 and the completion of some geological surveys within the tenement area. HNC is currently carrying out a major overhaul and validation of the Compass Resources data base including all Area 55 and Area 55 West data within ERL 148. The Area 55 project is currently undergoing feasibility studies which include archaeological, hydrogeological, metallurgical and geotechnical works. Continued drilling, geological mapping, reviewing of historical logging, generating 3D models and resource definition work will continue to support these feasibility studies. Some drilling is planned in this tenement for further resource definition. Geophysical surveys are planned in 2010 for the Rum Jungle area, including ERL 148. A detailed geotechnical drilling program is also planned as soon as access is possible to the area.