Group Annual Report GR425 EL 25054 and EL 28902 Chessman Project for Period Ending 17 April 2017

Abstract

Exploration Licences EL 25054 and EL 28902 are located about 20 km east of Katherine. They surround the Maud Creek gold deposit, which Kirkland Lake Gold Ltd ('KL Gold') have under consideration for development. This is the first group annual report combining the two licences, which were previously reported separately. The geology of the Project area comprises folded Palaeoproterozoic meta-sedimentary and volcaniclastic sequences. These are unconformably overlain by the Meso- Proterozoic Kombolgie Sandstone, which forms scarps. Flat-lying areas are covered by Cambrian Antrim Plateau basalts, and Cambro-Ordovician limestone covers much of southern part of EL 25054. Economically important rock units of the project area comprise greywackes, mudstones and tuffs of the Palaeoproterozoic Tollis Formation and Maud Dolerite which intrudes as irregular bodies up to 200m in width. SEDEX style mineralisation is also being considered as a new target style within the Cambrian sediments which overlie the Proterozoic basement. Exploration activities are now managed by PNX Metals Ltd ('PNX') as part of an earn-in deal. During the past reporting year, four rock chip samples were collected east of the Chessman prospect on EL 25054, with one returning a high copper result which warrants further investigation. Two diamond drill holes were drilled (580.8m) on VTEM anomalies at different stratigraphic positions to test for evidence of SEDEX mineralisation, but there were no significant results.