Tennant Creek Project Combined annual technical report for the Period 4 February 2009 to 3 February 2010

Abstract

Considering the previous drilling results, it was decided that a comprehensive exploration and geology review was needed to focus further exploration efforts at Tennant Creek. This process involved reviewing the previous drilling programme, conducting a comprehensive geological review, reinterpretation of magnetic and geophysical data from previous surveys, and creating new predictive and diagnostic exploration models. This review provided a new perspective that varied from previous concepts to direct future exploration activity at Tennant Creek. This is primarily a shift to targeting focus areas with the large system rather than individual deposits. The review also identified a key exploration risk at Tennant Creek, which is the gap between geophysical modelling and exploration drilling in areas of deeply weathered regolith. The trial use of partial-leach, multi-element soil geochemistry is proposed to bridge this current process gap and gain a better understanding of the nature of the mineral system within the target areas. The findings of the review resulted in the selection of seven 'Areas-of-Interest' that will be the basis for exploration in the next reporting period. Conclusion - New geological and exploration concepts have provided a new and nontraditional prospectivity model at Tennant Creek for Prosperity Resources, providing a new interpretation and focus on selected 'Areas-of-Interest' at Tennant Creek. Planned activity includes the trial surveys of the areas using partial-leach, multi-element soil geochemistry to better define drill targets by qualifying geophysical responses.