Annual Report EL 28045 Southern Cross Bore (SXB) Project 30 November 2016 to 29 November 2017

Abstract

EL 28045, Southern Cross Bore Project, located about 75kms northeast of Alice Springs is bisected by a north trending zone of intense tectonism called the Pinnacles Shear Zone hosting quartz - copper veins to the east and Johnnies Reward prospect to the west. Local geology is dominated by protolithic carbonate in the east which transitions abruptly to a pelite-psammite-acid volcanic sequence in the west assigned to the 1810 - 1800Ma Cadney metamorphics, Aileron Province, Strangways Metamorphic Complex, southeast Arunta Inlier. Johnnies Reward is a mature prospect discovered in 1964. Since acquisition by Davenport, exploration undertaken on the project area includes an RC drilling program, a soil-sampling program, rock sampling, a second drilling program including both RC and diamond drilling and a heliborne VTEM and magnetics survey. A VTEM survey in 2013 identified a number of anomalies, two of which were classified as high priority. At that time recommendations for future exploration at the Southern Cross Bore Project included a down hole EM survey and follow-up drilling. However, the break in field work due to the difficulty in raising funds for exploration meant that older drill holes where not open for DHEM. During 2017 Davenport undertook a fauna and flora report and a weed management study as a requirement for the Mine Management Plan (MMP). Historic exploration data was accessed and reassessed with information included in compiling a new comprehensive GIS for the licence. As part of this data review process it was determined that there was sufficient drilling to complete an initial JORC Resource estimate on the Johnnies Reward prospect and at the anniversary date of the tenement this work was in progress. A re-interpretation of the 2013 VTEM survey incorporating known geology has yielded additional information. As part of the exploration on surrounding licence EL 30090, a close spaced low level Aeromag survey was completed over the combined area including EL 28045. This was followed up with field checking of anomalies. The area of interest around and to the NW of Black Angus prospect did not show any geochemical anomalism, however, the presence of abundant tourmaline, including large tourmaline boulders is suggestive of extensive hydrothermal action in the area and needs further investigation. Based on past drilling a resource estimate has recently been completed at Johnnies Reward. The Mineral Resource estimate, prepared by Conarco Consulting includes an Inferred Resource of 2.2 Mt at 1.4 g/t gold equivalent for 101 koz gold equivalent. The Mineral Resource includes 52,000 ounces gold at 0.7 g/t gold and 9000 tonnes copper at 0.4% Cu. It is open down dip and additional plates modelled from the VTEM survey have not been drill tested.