Annual Report Year 6 EL 26944 Merlin Orbit Project for the period 30 April 2014 to 29 April 2015

Abstract

This Annual Report details exploration activity carried out by Merlin Diamonds Limited (MDL) over Exploration Licence 26944 for the period 30th April 2014 to 29th April 2015. This period represents Year Six of the Licence. The Exploration Licence is located on the Bauhinia Downs (SE53-03) 1:250,000 map sheet and the Glyde (6164) 1:100,000 map sheet. Access to the Licence is via a 64 kilometre formed gravel access road from the Carpentaria Highway to the Merlin Diamond Mine - the turn-off for this road is approximately 6 kilometres south-west of the McArthur River Mine turn-off. The Licence has been subjected to mineral exploration since the 1960's when the Carpentaria Exploration Company explored for base metals. Historic diamond exploration including airborne geophysics and ground exploration was undertaken by CRA during the 1980's and Ashton Mining during the 1990's. Results from indicator mineral sampling over geophysical targets in early 2013 are reported, with one target returning positive results from two samples. These results were not discussed in the 2014 Annual Report. During the current reporting period, final processing of 59 heavy mineral samples was undertaken through the company's diamond laboratory for recovery of kimberlitic indicator minerals and diamonds. Fifty-three samples targeted the contact between the Bukalara Sandstone and the overlying Cretaceous sandstones. The aim is to seek out kimberlite pipes that may be covered by Cretaceous sediments. Chromites eroded from these bodies may be trapped at the contact between the Bukalara and the overlying Cretaceous sediments and 'leaking out' into the current-day drainage systems. Several positive results were reported which will be followed up next year. Three ground electromagnetic surveys (13.8 line-kilometres) were completed over historic ground gravity targets. An additional thirteen targets were identified from a review of all geophysical and geochemical data covering the tenement.