Annual report on EL 23172 AuQuest Project Area period beginning 6 May 2008 to period ending 5 May 2009

Abstract

EL 23172 is located about 90 km east of Darwin and 8 km from Toms Gully Gold Mine. It was granted to Renison Consolidated Mines on 6 May 2003 for a period of 6 years. On 9 March 2009, it was renewed for another 2 years term and now will expire on 5 May 2011. On 25 July 2007, GBS Gold Australia Pty Ltd acquired all tenements and Toms Gully gold mine held by Renison Consolidated Mines NL, including EL 23172. The tenement is situated in the north-western part the Pine Creek Orogen, which has been interpreted as an intra-cratonic basin lying on an Archaean basement. It comprises 14 km thick sequence of Palaeoproterozoic sediments, accompanied by lesser volcanics, granitic plutons and dolerite intrusions. The Northern portion of the project area contains the oldest sediment of the Mount Partridge Group that is unconformably overlain by the South Alligator Group. The southern portion of the Project area is comprised of Burrell Creek Formation, which conformably overlies the South Alligator Group. Tertiary and Quaternary Soils and Gravel's unconformably overlie all the lower lying portions of the tenement areas, generally referred to as 'Black Soils Regions'. During the reporting period, a detailed technical review of the project area was undertaken, which identified gold and uranium potential of the EL. TMI image of the project area shows that it is characterised by the presence two deep seated structure, first is the NW trending probably fault which contains some gold prospects on its margin. The second feature is probably a doleritic dyke which also contains some gold occurrences. Although radiometric response is subdue due to thick recent alluvial cover but the project area still might have some potential for uranium mineralisation. In the following year, it is anticipated that selected areas will be mapped in detail, and a program of soil/rock chips sampling will be undertaken. This will lead to Air Core drilling campaign and samples collected will be assayed for gold, uranium and other related elements.