Westmoreland project MLN 578 Cobar II Annual report for period ending 31 December 2009

Abstract

ML 42C was applied for on 21 October 1955 and granted to Arthur Blackwell on 21 December 1955 for a term of 21 years to expire on 31 December 1975. The Lease was then sold to North Australian Uranium Corporation N.L. in 1956. The renewal application was submitted on 19 December 1975 by Dampier Mining Company and granted on 31 December 1975 for a further term of 21 years until 31 December 1996. ML 42C was replaced with MLN 578 in 1979 with an area of approximately 6.47 Ha. Department records then show that between December 1979 and July 1983 the position of the Lease was plotted in 6 different positions on maps. The second renewal was applied on 19 June 1996 by Newcrest Operations Ltd on behalf of the CHJV (now Newcrest Operations Ltd-RTZ Corporation-Plutonic Gold Pty Ltd) that was not granted until 13 November 2000. This was for a period of 21 years and the Lease is now due to expire on 31 December 2017. Between the application and grant dates of 1996 and 2000 the issue of the location of the Lease was raised again and settled internally by a Mining Title Officer from the Department familiar with the site. The Lease position in 1999 was then different to its former last position in 1983. In the 2007 DIPFM requested assistance from Newcrest to correct the inaccuracy in plotting of the Lease. Newcrest recommended that the Lease be replotted approximately 440m south southwest of its 2007 position recorded by the Department but without supporting information the replot changes were not adopted. Between 1999 and 2007 the Lease was again replotted approximately 200m NE of the 1999 position, in a location very similar to its position in 1981. NuPower recently purchased the Lease, along with MLN 585, from the Coronation Hill Joint Venture partners, now Newcrest Operations Ltd, (registered holder of the tenements on behalf of the CHJV), Plutonic Gold Pty Ltd (Barrick Gold Corporation) and Norgold Pty Ltd (Rio Tinto Ltd). The Sale and Purchase Agreement was executed on 21 November 2008, title was transferred on 2 February 2009 and the Sale Agreement was registered against the title on 4 March 2009. NuPower visited the prospect in late 2008 accompanied by the former Mining Title Officer and located the workings and evidence for the original lease corner pegs. The Lease was therefore repegged with a new datum and corner pegs that now places it approximately 540m SSW of the Department's most recent position prior to 2007. Cobar II is located in the Westmoreland region adjacent to the Palaeo-Proterozoic Murphy Tectonic Ridge, an east-northeast trending belt of basement rocks 150km long and up to 25km wide which separates the Palaeo-Proterozoic Mt Isa Inlier from the Meso-Proterozoic McArthur Basin and the flanking Neo-Proterozoic South Nicholson Basin. It comprises the Murphy Metamorphics, Cliffdale Volcanics and Nicholson Granite. The Murphy Metamorphics consist of Lower Proterozoic sediments, volcanics and intrusives that were deformed and regionally metamorphosed to lower greenschist facies. They are unconformably overlain by rhyolitic to andesitic ignimbrites, flow-banded rhyolitic lavas and acidic tuffs of the Cliffdale Volcanics. The Nicholson Granite complex, comagmatic with the Cliffdale Volcanics and comprising seven phases of related intrusions emplaced at successively higher crustal levels with time, intrude both the Murphy Metamorphics and the Cliffdale Volcanics. They are predominantly I-type in composition and contain uranium values that are usually twice that of average granites. Levels of radioactivity are also high in some of the ignimbrites of the Cliffdale Volcanics and these two units represent local primary sources of uranium. The Murphy Tectonic Ridge is unconformably overlain by the Tallawah Group that comprises the Mid Proterozoic Westmoreland Conglomerate and Seigal Volcanics in this region. The Westmoreland Conglomerate is divided into 4 units that grade upwards from a basal section of talus slope breccias and conglomerates through a succession of quartz, lithic and arkosic sandstones and interbedded pebble and cobble conglomerates topped by a unit of massive to laminated fine sandstones and claystones. Westmoreland Conglomerate is conformably overlain by amygdaloidal basalt flows of the Seigal Volcanics with minor siltstone and sandstone interbeds. The Seigal Volcanics are in turn unconformably overlain by Cretaceous conglomerates, sandstones and claystones of the Mullaman Beds forming isolated mesas and plateau of a once extensive sedimentary basin that extended far into Queensland. At Cobar II Unit 4 of the Westmoreland Conglomerate is overlain by basalts of the Seigal Volcanics that are in turn overlain by Cretaceous sandstones and conglomerates of the Mullaman Beds. The Seigal Volcanics/Westmoreland Conglomerate contact dips gently north from its exposure to the south to underlie the Seigal Volcanics in the central and northern parts of the prospect area and the Westmoreland Formation itself dips north generally at 7-9. Within Unit 4 the interval between the Metre Conglomerate and the Seigal/Westmoreland contact increases from 42m in the south to 62m in the north. There is therefore a thickening in the upper section of unit 4 northwards and a slight thickening westwards. The siltstone at the top of Unit 4 is locally absent but where present is often highly silicified. It is mostly less than 1m thick. Quartz-filled fractures and small scale faults are common. Three near-vertical, north trending en echelon shears have been mapped in the basalts north of the Seigal/Westmoreland contact. Blackwell's Mine lies within the main Cobar II Shear to the north, Old Parr lies in the southernmost South Shear and the Middle Shear lies on the ridge between Cobar II and Old Parr. At Blackwell's Mine the shear was reported to be up to 11.7m wide. The fissure dips steeply west and is filled with sheared chloritic rock, interpreted as an altered igneous dyke rock. This is supported by the presence of sandstone breccia material in the dump since the workings did not extend at depth to the Westmoreland Conglomerate. Surface secondary uranium mineralisation at Blackwell's Mine consisted mainly of sklodowskite, saleeite, carnotite and phosphuranylite. In the workings pitchblende occurred as tabular patches and seams up to 1.5cm with and 10cm long associated with hematite bands and also in intimate intergrowths with hematite. The orebody as mined lay entirely within the shear zone and was considered to be south plunging. The main ore shoot was worked to a depth of 54.9m, ore was hand-picked to improve the grade and a total of 76.9 tonnes grading 10.2%U3O8 was trucked to Rum Jungle for treatment. NuPower acquired the property to explore for further high grade uranium mineralisation, similar to that mined historically. Work to date includes repegging of the Lease to resolve historical confusion of its exact location, a preliminary visit to determine access and logistics required for on-going exploration, a baseline environmental study and a Sacred Sites survey. The environmental study found that there are no flora species and only two fauna species (birds) of conservation significance. Undisturbed water from the creek draining the area contains levels of Cu and Cr that exceed the ANZECC Guidelines 2000. There are no Sacred Sites in the Lease or immediately surrounding it.