Annual Technical Report for EL 28900 Eastern Railroad Chandler Project for the period 5 March 2013 to 4 March 2014

Abstract

The Chandler Project consists of six exploration licenses held by Tellus Holdings Ltd ('Tellus'), located in the Amadeus Basin, approximately 130km south of Alice Springs. This annual report relates to one of the exploration licenses; EL 28900 Eastern Railroad for the reporting period ending 4th March 2014. The Chandler Project is targeting subsurface salt deposits to assess potential evaporitic mineralisation within the Amadeus Basin. Two known salt units are present in the Chandler project area, namely the Chandler Formation and the deeper Gillen Salt Member. Exploration activities to date indicate a significant thickness of massive to semi massive halite exists within the Chandler Formation at a depth of approximately 700-1000m. During the reporting period Tellus completed a diamond drilling program on adjoining tenement EL 29018. Core sampling collection and wireline logging were completed. Geochemical and mineralogical analysis are taking place. In order to assess potential evaporitic mineralisation further over EL 28900 wireline and stratigraphic information will be used to update the seismic interpreted geological model over the project area.