Annual exploration report Rhodes Tenement Group MLN's 414-418 Year ending 31 December 2009

Abstract

Rhodes Group comprises 5 tenements (MLNs 414-418) which are located 115km SE of Darwin and 3km NE of Mount Paqualin. Mineral Leases Northern 414 to 418 inclusive were granted to Peko Wallsend on the 8 February 1978. W.R. Grace Australia Ltd held an option over the tenements dating from an agreement of 8 July 1985 with Peko Wallsend. In 2002, Buffalo Creek Mines Pty Ltd and Territory Goldfield Pty Ltd (Burnside Operations Pty Ltd) acquired the tenements which became wholly owned subsidiaries of GBS Gold Australia Pty Ltd in 2005. In November 2009, Crocodile Gold Australia acquired the tenement group along with other assets after liquidation of GBS Gold Australia. The Rhodes gold prospect is considered a strategic gold resource of low to medium grade that has been drilled by previous explorers. Northern Gold estimated a non-JORC global resource of 700,000t at 1.80g/t Au. After the tenements were incorporated into the Burnside JV in April 2002, Rhodes was ranked as a potential source of low grade mill feed due its close proximity to the Burnside Project area. During the reporting year, the Rhodes Group of tenements remained under care and maintenance. The main activity was review, valuation and tenement ranking in order to prepare assets for sale. Liquidated assets of GBS Gold were purchased by Crocodile Gold Australia on 9 November 2009, and commenced mining and exploration activities in the region. Other activities were reconnaissance visits, tenement administration and report writing. Crocodile Gold Australia regards the Rhodes Group highly because of the presence of significant gold resource, which can increase with dedicated exploration program. In the next reporting year, exploration program will include ground-truthing, preliminary sampling and a proposed drilling if warranted.