Annual Report for ML 27244 Wonarah Mineral Lease for the period ending 17 February 2012

Abstract

ML 27244 forms part of the Wonarah Phosphate Project (along with EL 9979, EL 26584, EL 26585, EL 26586, EL 26589, EL 24607, EL 26185, EL 28233, EL 26451 and EL 26452), and is located approximately 240km east-southeast of Tennant Creek. Minemakers Australia Pty Ltd is seeking to develop a large sedimentary phosphate deposit within the Georgina Basin. The model for phosphate deposition requires upwelling, cold phosphate-saturated water depositing phosphate into a restricted environment on the continental shelf where the postulated required narrow pH range is locally present. Post-depositional reworking and replacement of carbonate facies by phosphatic mineralisation is probably an important factor in upgrading phosphorite grades to economic levels. The project area has two principal areas of exploration focus; Main Zone and Arruwurra. The geology of the Main Zone comprises basement granite of Palaeoproterozoic age, unconformably overlain by basalt of the Helen Springs Volcanics. The volcanics are unconformably overlain by dolomitic rocks of the Thorntonia Limestone equivalent in part. The overlying phosphate-bearing Upper Gum Ridge Formation is divided locally into five main units; the Transitional Phosphorite, the Transition Sediments, the Chert Breccia Phosphorite, the Mudstone Phosphorite (main phosphate bearing unit) and the Convolute Mudstone. The Wonarah Formation overlies the Upper Gum Ridge Formation and consists of mudstone, siltstone and sandstone. The geology of Arruwurra is essentially similar with some minor differences. An RC drilling program comprising 6 holes for 339m and 85 assays (including checks) was conducted in 2011. A program of yttrium analysis using RC chips using a portable XRF machine was also completed. An update of the 2009 completed Mineral Resource estimation for Main Zone was completed with a total of 252Mt Indicated at 18.2% P2O5 (10% P2O5 % cut-off) and 395 Mt Inferred (18% P2O5 cut-off). The resource lies mostly within ML 27244 but extends onto other Minemakers' tenements. Other reports completed by consultants comprised a review of metallurgical test work, enabling feasibility study, rehabilitation procedures manual and an exploration activities site audit. The 2011 drill program increased the Main Zone JORC combined Inferred and Indicated Resource by 25% at 10% P2O5 cut-off to 647Mt at 18% P2O5. Hand-held XRF sampling to date has not delineated any significant zones of yttrium mineralisation.