Combined annual and final report Year 10 EL 26206 Mainoru Lead-Zinc Prospect, 19 March 2008 to 28 March 2018

Abstract

This Combined Annual and Final Report collate exploration activities undertaken by Merlin Diamonds Limited (MDL) and Myanmar Metals (formerly Top End Minerals) on EL 26206 from the grant date 19th March 2008 to the surrender on 28th March 2018. MDL held the title for 10 Years and explored for diamond bearing kimberlite intrusives and carbonate hosted base metals deposit. During the first three years (2008-2011), MDL collected reconnaissance traditional diamond indicator mineral (DIM) samples and geochemical samples. Processing of diamond indicator mineral samples returned negative results as no kimberlitic indicator mineral was recovered. When these results were re-examined by combining with the historical indicator mineral data collected by Stockdale Prospecting, it was concluded that the potential for discovery of kimberlite intrusive in the title's area is low. Preliminary geochemical results for base metals were not encouraging too. During 2011-2012, MDL reassessed its exploration strategy on the project and decided to search for base metals mineralisation as assessment of historical exploration results from the tenement area indicated occurrence of Zn-Pb mineralisation- i.e. 'The Swamp' anomaly. MDL collected stream samples for geochemical analysis. Assay results returned elevated lead and zinc values consistent with the historical data and warranted more thorough geological assessment of the project area. During 2012-2013, MDL conducted ground geological investigation of an area, approximately 1 by 1.5 km, located just north-west of 'The Swamp' anomaly. MDL collected rock chip samples from outcrops showing silicified gossanous features for geochemical analysis. Rock chip samples returned anomalous Zn/Pb/Ag assays with maximum values of 3.31% Zn, 0.63% Pb and 10.3ppm Ag. Similar values were returned from samples located over 700m apart. Rock chip geochemistry, combined with regional and local geological setting suggested a reasonable possibility for the occurrence of Mississippi Valley Type Pb/Zn mineralisation in the target area. This same area with anomalous base metals geochemistry was further investigated by ground gravity survey during 2013-2014 reporting period. Processing of the gravity data identified a gravity (and possibly conductive) anomaly which was spatially associated with an area defined by surface rock chip mineralisation. MDL also trialled orientation ground electromagnetic survey on a small area using an EM34-3. The encouraging results warranted ground EM survey to be extended over the entire gravity target. During 2014-2015, no field based exploration activities were conducted; MDL, however, undertook extensive review of all historical and company's own geochemical and geophysical data including ground EM survey. Aim was to structure future exploration work on the project that will assist to delineate actual drill hole locations. During 2015-2016, MDL carried out MMI-MTM soil survey over the gravity anomaly defined by 2013 ground gravity survey. This program was completed in two phases. During the first phase (carried out in June 2015), 365 MMI soil samples were collected. During the second phase (carried out in early August i.e. dry season) further 174 MMI soil samples were collected. Some of these samples were the repeat from locations which returned high Zn and Pb values from samples collected during the first phase and others were along the contact between the Dook Creek Formation and overlying Limmen Sandstone to test the idea that stratigraphic contact between two formations is the most prospective site for a significant Pb-Zn mineralisation. During MMI soil survey, MDL also collected rock samples from all rock-types that outcrop within the limits of identified gravity anomaly for density measurements. Furthermore, some of these rock samples that belong to the Dook Creek Formation were probed for multiple elements by using ICP-AES analysis. In preparation for the drilling program, MDL applied for 'Authority Certificate' from the Aboriginal Area Protection Authority (AAPA). In September 2015, Company received AAPA 'Authority Certificate' which defined nine 'Restricted Work Areas' (RWA) where 'no person shall enter or no work shall take place or no damage shall occur'. In essence, 'Authority Certificate' restricted access to large parts of the tenement including strategic area hosting gravity anomaly - a high priority drill target. During 2016-2017, MDL made contact with the representative of the Traditional Owners seeking a meeting to discuss access to the tenement and applied for grant of 'Variation to the AAPA Authority Certificate'. During 2017-2018, Company received response from the AAPA. AAPA issued a new 'Authority Certificate'. The new 'Authority Certificate', as such, retained previously designated nine 'Restricted Work Areas' and upheld their formerly defined spatial boundaries. With regards to the MDL request for grant of permission to carry out drilling to test the company's high priority geophysical target which is located southwest of the marked sacred site in RWA6, AAPA declined this request. AAPA argued that the marked locality of sacred site on the map is in fact an indicative location where GPS point was taken. The sacred site feature in reality represents a large site boundary on which RWA6 is based. As a result area of exploration interest remained within the RWA6 and hence cannot be explored further. No further exploration work was conducted on the tenement; however, MDL critically reviewed the exploration data and Authority Certificates received from AAPA. This review concluded that it will be difficult to make further progress on the project due to restrictions emplaced by the AAPA 'Authority Certificate' and recommended to relinquish the title. EL 26206 was surrender on 28 March 2018.