Fifth annual report for the Tanami Exploration Agreement EL 2366, EL 2367, EL 22170, EL 24889, EL 24895, EL 24973 and SEL 23662 for the period 1 January to 31 December 2009

Abstract

Following reassessment of district prospectivity in the 2008 reporting period, exploration in 2009 was planned to test two targets to validate the empirical model devised through the previous year. Drilling was planned for the Oberon Deeps and Callie NW targets, comprising 3 x 900m holes at Oberon and 3 x 500m holes at Callie NW for an aggregate of 4,200m of diamond drilling. Significant delays were encountered in the CLC Sacred Site Clearance process; while awaiting clearance to mobilise to Oberon, an opportunity was taken to drill five holes previously CLC cleared at the Pegasus prospect. Discovery of a significant opportunity on MLS 154 saw re-allocation of much of the TEA budget to focus on mineralisation beneath the existing Callie and Auron ore bodies. A single hole was partly completed at Oberon, to a depth of 703m from a design of 900m. Results included 2m at 3.72ppm Au and 1m at 17.5ppm Au from rocks similar to those of the Schist Hills Iron Member at Callie. At Pegasus 5 holes were drilled for an aggregate of 1005.1m of HQ core. Results from the programme were in line with expectations, with scattered results in the 3 - 5ppm Au range. Drill density was insufficient to give solid evidence of continuity between drill holes. Significant assays were narrow, relatively low grade and from greater than 50m depth. 2009 results confirm existing RAB intersections, but do not add to, or extend, mineralisation. Other work included waterbore drilling (nominally for the Tanami Operations Optimisation Project), from which samples were obtained for exploration purposes. It is recommended that further work be conducted within the TEA, comprising ongoing drill validation of the exploration model developed in 2008. Favourable results would necessitate increased drilling focus in 2011 to 2012.