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ELKEDRA DIAMONDS NL Altjawarra Craton Diamond Project Final Relinquishment Report for EL 22536 (Last Hope West) By: Jo Leadbeatter Linda A Tompkins November 19, 2004 Elkedra Report No. 0151 Keywords: Northern Territory, Altjawarra Craton, Diamond Exploration, Stream Sediment Sampling, Diamond, Diamond Indicator Mineral, Geochemistry, Magnetics, Elkedra Survey. Map Sheets: 1: 250,000: Tobermory (SF53-12) 1:100,000: Alkea (6353); Algamba (6253) Copy To: NTDBIRD, Darwin, Northern Territory Elkedra Diamonds NL Perth library
Transcript
Page 1: Altjawarra Craton Diamond Project - geoscience.nt.gov.au · and shallowly buried drainage systems throughout the tenement. Due to a blanket cover of 4-5m Due to a blanket cover of

ELKEDRA DIAMONDS NL

Altjawarra Craton Diamond Project

Final Relinquishment Report for

EL 22536 (Last Hope West)

By: Jo Leadbeatter

Linda A Tompkins

November 19, 2004

Elkedra Report No. 0151

Keywords: Northern Territory, Altjawarra Craton, Diamond Exploration, Stream Sediment Sampling, Diamond, Diamond Indicator Mineral, Geochemistry, Magnetics, Elkedra Survey.

Map Sheets:1: 250,000: Tobermory (SF53-12)

1:100,000: Alkea (6353); Algamba (6253)

Copy To: NTDBIRD, Darwin, Northern Territory Elkedra Diamonds NL Perth library

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Table of Contents

1 Introduction ...........................................................................................................................1

2 Conclusion..............................................................................................................................1

3 Geological setting...................................................................................................................2 3.1 Regional Geology............................................................................................................... 2

3.2 Tenement Geology ............................................................................................................. 2

4 Exploration Completed.........................................................................................................2 4.1 Aeromagnetic Interpretation............................................................................................... 2

4.1.1 Last Hope Palaeo-channel .......................................................................................3

4.2 UTS Airborne Magnetic Survey......................................................................................... 3 4.2.1 1 X 1 Individual Surveys.........................................................................................4

4.3 Ground Magnetic Surveying .............................................................................................. 4

4.4 Aerial Photography Interpretation...................................................................................... 5

4.5 Surface Sampling ............................................................................................................... 5 4.5.1 Rock chip Sampling ................................................................................................6 4.5.2 Soil Sampling ..........................................................................................................6 4.5.3 Stream Sediment Sampling .....................................................................................6

4.6 Drilling ............................................................................................................................... 6 4.6.1 RC Drilling ..............................................................................................................6 4.6.2 RAB Drilling ...........................................................................................................7

5 Laboratory Results................................................................................................................8 5.1 Heavy Mineral Concentrate Analysis................................................................................. 8

5.1.1 Surface Sampling ....................................................................................................8 5.1.2 RC Drillhole Samples..............................................................................................8 5.1.3 RAB Drillhole Samples...........................................................................................8

5.2 Mineral Chemistry.............................................................................................................. 8 5.2.1 Red Sandstone .........................................................................................................8

5.3 Geochemistry...................................................................................................................... 9 5.3.1 Rock chip Sampling ................................................................................................9 5.3.2 Soil Sampling ........................................................................................................10 5.3.3 Stream Sediment Sampling ...................................................................................10 5.3.4 RC Drilling ............................................................................................................10

6 References ............................................................................................................................11

List of Tables:Table 1: Summary of UTS aeromagnetic survey specifications Table 2: Summary of UTS 1 X 1 individual aeromagnetic survey results Table 3: Summary of ground magnetic survey results Table 4: Summary of surface samples collected Table 5: Summary of RC drilling

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Table 6: Summary of RAB drilling

List of Figures:Figure 1: Tenement Map: Area of relinquishment Figure 2: Aeromagnetic anomaly locations Figure 3: UTS aeromagnetic survey locations Figure 4: Ground magnetic survey locations Figure 5: Aerial photography anomaly locations

List of Plans:Plan 1: Aerial Photography Interpreted Geology Plan 2: Surface Sample Locations Plan 3: Drillhole Collar Locations Plan 4: Manganese Compilation

Appendices:File

number File Description Digital Data File name

Appendix 1 Aeromagnetic anomalies

EL22536_AeromagAnomalies.xls

Appendix 2 UTS aeromagnetic surveys

EL22536_UTS_elk004_CWN153.xyz EL22536_UTS_elk005_CWN160.xyz EL22536_UTS_elk008_CWN159_161.xyz EL22536_UTS_ArgadargadaAreaD_CWN149_157.xyz

Appendix 3 Ground magnetic surveys

EL22536_CWN090_Groundmagnetics.xyz EL22536_CWN091_Groundmagnetics.xyz EL22536_CWN092_Groundmagnetics.xyz EL22536_CWN093_Groundmagnetics.xyz EL22536_CWN095_Groundmagnetics.xyz EL22536_CWN101_102_Groundmagnetics.xyz EL22536_CWN103_Groundmagnetics.xyz EL22536_CWN104_105_Groundmagnetics.xyz EL22536_CWN161_Groundmagnetics.xyz EL22536_CWN166_Groundmagnetics.xyz EL22536_LastHope_Groundmagnetics.txt

Appendix 4 Aerial photography anomalies

EL22536_PhotoAnomalies.xls

Appendix 5 Geology anomalies - Manganese

EL22536_GeologyAnomalies_Manganese.xls

Appendix 6 Surface sample data EL22536_SurfaceSamples_BackgroundMinerals.xls EL22536_SurfaceSamples_Geochemistry.xls EL22536_SurfaceSamples_Geochemistry_Flat.xls EL22536_SurfaceSamples_Indicators.xls EL22536_SurfaceSamples_Indicators_Flat.xls EL22536_SurfaceSamples_Locations.xls EL22536_SurfaceSamples_MineralChemistry.xls EL22536_SurfaceSamples_MineralChemistry_Flat.xls

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Appendix 7 Drillhole data EL22536_Drilling_BackgroundMinerals.xls EL22536_Drilling_Collars.xls EL22536_Drilling_CompositeBackgroundMinerals.xls EL22536_Drilling_CompositeIndicators.xls EL22536_Drilling_CompositeSamples.xls EL22536_Drilling_Geochemistry.xls EL22536_Drilling_Indicators.xls EL22536_Drilling_Lithology.xls EL22536_Drilling_MagSus.xls EL22536_Drilling_MetaData.xls EL22536_Drilling_Samples.xls EL22536_Drilling_SamplesQC.xls EL22536_Drilling_Survey.xls

Appendix 8 Library Codes Library_Codes.xls

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1 INTRODUCTION Exploration License EL 22536 is located on the Tobermory (SF53-12) 1:250,000 sheet in central Northern Territory (Figure 1). This report details all work carried out on the relinquished portion of the tenement up to August 9, 2004 by Elkedra Diamond NL.

2 CONCLUSION The Last Hope tenement is situated within the central core of the main Central Craton target area which represents Elkedra’s priority regional tectonic target for kimberlite exploration. Numerous aeromagnetic anomalies identified from the regional aeromagnetic Elkedra survey and several sub-circular photo-feature were drill tested during the tenure but no kimberlite or related rocks were identified. Modern day drainage in this area is poor to non-existent limiting the effectiveness of traditional surface sample techniques. However, a single micro-diamond was recovered (W0046) from perched gravels exposed within a shallow trench dug into a sand choked channel system (“Diamond Creek”) located in the center of the tenement. Subsequent but limited RAB drilling at this location identified buried gravels at depth but no diamond indicators or microdiamonds were recovered from the drill spoils. The area around CWN-090 remains interesting. Mg-ilmenite was identified in a red sandstone, extremely high values of Ce (up to 5,000pmm) were reported from other surface rock chips, and elevated values of S (up to 30,000 ppm) reported from surface (1-4m) drill spoils (ERC-0035). Limited surface mapping and ground magnetic data suggest the possible presence of an ENE trending palaeo-channel at this location. Reprocessing of the Elkedra Survey highlights several styles of near-surface, weakly magnetic and shallowly buried drainage systems throughout the tenement. Due to a blanket cover of 4-5m of unconsolidated sand over the entire tenement, further exploration efforts of these buried channels systems is definitely warranted. However, as a result of higher exploration priorities in other areas no further diamond exploration work on this tenement could be justified by Elkedra at this time. The tenement was also explored in tandem for base metal and manganese. From a base-metal perspective, the best drill intersection is in ERC-0032 drilled into magnetic anomaly CWN-091. Elevated values of Pb (up to 1.43%), Zn (485 ppm), Cu (148 ppm), Ag (0.5 ppm) and Au (up to 27 ppb) were encountered over a 3m (43-46m) interval. The elevated values appear to be associated with a dissolution cavity developed within a weathered siltstone interval at the basal contact with carbonates. As it appears to be an isolated occurrence, no further work by Elkedra is currently warranted. Manganese exploration predominantly involved location of surficial anomalies visible on aerial photography and ground truthing of these with surface (soil and rock chip sampling). In terms of manganese potential geochemical results were generally disappointing and no further work on manganese exploration is deemed justifiable at this point.

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7525000 mN

7575000 mN

7550000 mN 7550000 mN

7575000 mN

6750

00m

E

7000

00m

E

7250

00m

E

7500

00m

E

7525000 mN

6750

00m

E

7500000 mN 7500000 mN

7500

00m

E

7000

00m

E

7250

00m

E

LAST HOPE WESTEL22536

0 5 10

kilometres

20

Figure 1EL22536 LAST HOPE WEST

Tenement Location PlanArea of Relinquishment

Author: JL

Office: Bullsbrook

Drawing: 0151_Fig1

Date:8/11/2004

Scale: 1:500000 Projection: MGA Zone 53 (GDA 94)

Roads

HighwayMinor roads and tracks

Tenement Area

EL22536Relinquished Area

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3 GEOLOGICAL SETTING 3.1 Regional Geology The Altjawarra diamond project is located on the North Australian Craton, which represents an amalgamated terrain that was consolidated around 1,800 Ma. From a diamond exploration perspective, the significance of the North Australian Craton is that it hosts all of Australia’s diamond mines to date including the recently discovered diamondiferous Merlin kimberlites located on the eastern portion of the North Australian Craton. Of particular importance is the age of the Merlin pipes, which have been dated as Devonian (~380 Ma). Elkedra Diamonds are targeting this same kimberlite event, or younger, in the southern Georgina Basin located south of the Merlin field. The project area incorporates several kilometers of Cambro-Ordovician platform sediments of the southern Georgina Basin, which wholly veneer a basement continental block referred to as the Altjawarra Block. The southern Georgina basin and the underlying Altjawarra Block in particular, are associated with a zone of anomalously thick lithosphere extending to at least 200km depth as recognized from recent seismic tomography studies (Kennett, 1997; Van der Hilst et al., 1998; Debayle and Kennett, 2000). The geophysical data highlight the area as highly prospective for the emplacement of diamond-bearing kimberlites. 3.2 Tenement Geology The relinquished portion of the tenement is underlain predominantly by younger Tertiary limestones of the Austral Downs Formation and Quaternary sands and silt. The limestone unit documents the presence of an ancient palaeolake Austral in Tertiary time.

4 EXPLORATION COMPLETED Exploration activities undertaken include:

1) Processing and targeting for aeromagnetic anomalies from the Elkedra survey. 2) Aerial photography interpretation. 3) Low-level fixed wing aeromagnetic surveys over selected areas. 4) Stream sediment sampling. 5) Soil geochemistry. 6) RC and RAB drilling.

4.1 Aeromagnetic Interpretation The release of the Elkedra aeromagnetic survey flown for the NTGS has proved critical in this early stage of exploration and forms the basis of all geophysical work undertaken in the tenement. All aeromagnetic interpretation and processing were undertaken by Dr. Duncan Cowan of Cowan Geodata Services, Perth. The aeromagnetic, altimetric dtm and radiometric data covering the Central Craton target area were windowed out of the Elkedra NTGS dataset. The windowed area was initially analyzed by running the “Smart” filter program of Cowan Geodata Services. The filter is a simple pattern recognition technique developed by Cowan Geodata Services. The program uses regression analysis between a window of the grid data and a typical model anomaly to identify roughly circular anomalies. The model data calculated is a full 3D vertical cylinder implementation. The method involves various inputs to the program including window size, model cylinder radius, top and bottom depths and amplitude response. In the Central Craton area the filter was run once to test response using a standard 200m diameter cylindrical model with a 30m depth, 400m grid window, and 25-200nT amplitude range.

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Further data enhancement and preliminary kimberlite target screening was later undertaken in a smaller area referred to as the central craton area using a combination of techniques which included:

• 1D Wavenumber filtering • 2D Euler deconvolution depth calculation • 2D Werner deconvolution depth calculation • Modelling and inversion of individual anomalies

The focus was on identifying possible kimberlite targets in the presence of significant intrasedimentary background noise due to maghemite channels, areas of ferricrete, clay-pans and sinkholes and cultural sources. The altimetric dtm and radiometric data were used to assist in anomaly screening. Identifying possible kimberlite magnetic anomalies in an area of extensive drainage and palaeosurface related magnetic anomalies is difficult due to a high degree of anomaly overlap as well as interference from anomalies due to shallow basement rocks. The relatively wide line spacing of 400-m limits spatial resolution of small sources as small kimberlites located between flight lines may not be detectable or produce only weak magnetic anomalies with magnetic attributes similar to sinkholes etc. A total of 17 anomalies were identified from the aeromagnetic data within the relinquished area (Figure 2; Appendix 1). 4.1.1 Last Hope Palaeo-channel Exploration follow-up of discrete aeromagnetic targets during the 2002 and first half of 2003 field seasons led to the recognition that there is a near-surface, weakly magnetic regolith feature hampering attempts to screen and locate potential magnetic kimberlite pipes. A review of exploration strategy in mid-2003 was undertaken including re-processing of the aeromagnetic data by Cowan Geodata Services to enhance the near-surface, high-frequency magnetic signals. The results led to the recognition of potential buried palaeo-channels. Portions of the Last Hope palaeo-channel occur within the relinquished tenement. Other styles of smaller and more sinuous channels are also evident in the data.

4.2 UTS Airborne Magnetic Survey An airborne aeromagnetic and radiometric survey of one area totaling 350 line-kms and three separate 1km X 1km aeromagnetic only anomaly surveys (Figure 3) were flown by Universal Tracking Systems Pty Ltd (UTS). The survey was flown using a Fletcher FU24-954 cropduster aircraft using a tail stinger magnetometer and a multichannel gamma ray spectrometer. All data were processed by Cowan Geodata Services. A summary of the survey specifications is shown in Table 1. Digital data results are reported in Appendix 2.

Table 1. Summary of UTS aeromagnetic survey specifications.

Prospect Name

Line Spacing

Line Direction

Tie Line Spacing

Tie Line Direction

Sensor Height

Magnetic Sample Density

Radiometric Sample Density

Total Line Km

elk004 elk005 elk008

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CWN-166

CWN-101CWN-102

CWN-153 CWN-159

CWN-161

CWN-092

CWN-095CWN-103

CWN-160

CWN-105

CWN-090

CWN-091

CWN-093

CWN-104

CWN-149

CWN-157

7560000 mN

7540000 mN

7200

00m

E72

0000

mE

7520000 mN

7000

00m

E

7520000 mN

7000

00m

E

7560000 mN

7540000 mN

0 2.5 5

kilometres

10

Projection: MGA Zone 53 (GDA 94)

Figure 2EL22536 LAST HOPE WEST

Aeromagnetic AnomaliesAuthor: JL

Office: Bullsbrook

Drawing: 0151_Fig2

Date:8/11/2004

Scale: 1:250000

Tenement Area

Aeromagnetic Anomaly

EL22536Relinquished Area

Centre of anomaly

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Argadargada Area D

elk004

elk005

elk008

7560000 mN

7540000 mN

7200

00m

E72

0000

mE

7520000 mN

7000

00m

E

7520000 mN

7000

00m

E

7560000 mN

7540000 mN

0 2.5 5

kilometres

10

Drawing: 0151_Fig3

Projection: MGA Zone 53 (GDA 94)

Figure 3EL22536 LAST HOPE WEST

UTS Aeromagnetic SurveyLocations

Author: JL

Office: West Perth

Date:16/11/2004

Scale: 1:250000

Tenement Area

UTS Aeromagnetic Surveys

EL22536Relinquished area

Survey area

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Argadargada Area D

50m 000-180 500m 090-270 25m 5m 50m 350

TOTAL 350

Area D corresponds with aeromagnetic anomalies CWN-149 and CWN-157. Anomaly CWN-149 was due to high-frequency drainage features and no further follow-up is recommended. Anomaly CWN-157 is also related to a high frequency drainage related feature. However, two more coherent anomalies were identified that may be regolith features. Further follow-up of this anomaly was planned for 2004 but due to logistical field problems no follow-up work was done. 4.2.1 1 X 1 Individual Surveys Three individual targets were initially identified from separation filter images of the NTGS regional Elkedra survey data as quite subtle possible intra-sedimentary responses. Unfortunately, very low level airborne magnetometer surveys mainly amplify regolith amplitudes and this was borne out by the UTS survey. None of the individual surveys warranted further follow up. Results are summarized in Table 2. Table 2. Summary of UTS 1 X 1 individual aeromagnetic survey results.

UTS Survey Anomaly No. Results elk004 CWN-153 High frequency drainage-related anomalies. No follow-up

recommended. elk005 CWN-160 High frequency very low amplitude drainage-related

anomalies. No evidence of the anomaly that was seen in the NTGS data. No follow up recommended.

elk008 CWN-159 & CWN-161

High frequency drainage-related anomalies. No follow-up recommended.

4.3 Ground Magnetic Surveying The ground magnetic survey was done using a GEM System GSM-19W V6 Magnetometer equipped with a GPS for collection of data in real-time walk-mag mode. The digital data is dumped into Toshiba notebook computers in the field and is processed and grided using the windows version of Chris.dbf. Digital data is also e-mailed via satellite connection facilities to the company’s consultant geophysicist, Dr. Duncan Cowan of Cowan Geodata Services for further processing and review. Digital data results are summarized in Appendix 3.

The ground magnetic surveys were used successfully to test aeromagnetic anomalies and thus generate drill targets. A total of 12 ground magnetic surveys were undertaken during the reporting period for a total of 112.42 line-kms (Figure 4; Table 3). Table 3: Summary of ground magnetic survey results.

Survey Name Line km Results

CWN-090 11.9 Anomaly along ENE linear trend – palaeo-channel?; Drilling not recommended.

CWN-091 7.8 Discrete negative anomaly; drilling recommended.

CWN-092 7.8 Single line, double peaked anomaly; drilling not recommended.

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CWN-166

CWN-095

CWN-101-102

CWN-111

CWN-161

Last Hope

CWN-090

CWN-091

CWN-092

CWN-093

CWN-104-105

CWN-103

7560000 mN

7540000 mN

7200

00m

E72

0000

mE

7520000 mN

7000

00m

E

7520000 mN

7000

00m

E

7560000 mN

7540000 mN

Figure 4EL22536 LAST HOPE WEST

Ground MagneticSurvey Locations

0 2.5 5

kilometres

10

Drawing: 0151_Fig4

Projection: MGA Zone 53 (GDA 94)

Author: JL

Office: West Perth

Date:8/11/2004

Scale: 1:250000

Tenement Area

Ground Magnetic Survey

EL22536Relinquished area

Survey point

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CWN-093 7.8 Dipping thin sheet, geomorphic expression; drilling recommended.

CWN-095 7.8 Two separate 2-line anomalies; drilling not recommended.

CWN-101-102 13.6 E-W elongate anomaly with changes along strike. Drainage-related?

CWN-103 7.8 Two small anomalies on NE trend; geomorphic expression. CWN-104-105 13.92 Elliptical feature superimposed on ENE linear anomaly.

CWN-111 7.8 Steeply dipping tabular body with large depth extent ; NW elongate discrete anomaly.

CWN-161

7.8

Small narrow 1-line anomaly. Regolith? No follow up recommended.

CWN-166 13.6 No coherent anomaly. No follow up recommended. Last Hope 4.8 No palaeo-channel response identified. TOTAL 112.42

4.4 Aerial Photography Interpretation Dr. Nick Lockett of Nick Lockett & Associates undertook a photo and Landsat-7 interpretation at a scale of 1:50,000 of most of the relinquished tenement (Plan 1) to identify any potential geomorphic anomalies that may be related to possible intrusive pipes and possible outcropping manganese rocks (Plan 4). Results are summarized in Appendices 4 & 5, respectively. A total of eleven sub-circular photo feature anomalies are identified within the relinquished tenement (Figure 5) and are listed in Appendix 4. Most of the anomalies are given a low priority rating, though two are given a medium priority rating. One of the photo-feature anomalies, LOC-051, has a coincident aeromagnetic response associated with it (CWN-166). A NE trending roll-over structure was also identified from the study documenting a post-depositional (post-Ordovician) NE striking dilational trend. Similar roll-over structures are known to be favourable structural hosts for kimberlite and related rocks elsewhere.

4.5 Surface Sampling A total of 168 surface samples were collected (Table 4) for both kimberlite exploration as well as follow-up of potential manganese and base metal targets (Plan 2). Results are summarized in Appendix 6. Table 4: Summary of surface samples collected.

Sample Type Number of Samples Collected

Heavy Mineral Concentrate

Analysis

Sample Geochemistry

Rock chip samples 55 0 28 Soil samples 97 0 96 Loam samples 8 8 8 Termite mound samples 6 4 4 Stream sediment samples 2 1 1 Total 168 13 137

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Loc-51

Loc-44

Loc-45

Loc-46

Loc-50

Loc-52

Loc-38

Loc-39

Loc-40

Loc-42

Loc-43

7560000 mN

7540000 mN

7520000 mN

7200

00m

E72

0000

mE

7000

00m

E70

0000

mE

7560000 mN

7540000 mN

7520000 mN

Figure 5EL22536 LAST HOPE WESTAerial Photography Anomalies

0 2.5 5

kilometres

10

Drawing: 0151_Fig5

Projection: MGA Zone 53 (GDA 94)

Author: JL

Office: West Perth

Date:8/11/2004

Scale: 1:250000

Tenement Area

Aerial Photography Anomaly

EL22536Relinquished area

Centre of anomaly

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4.5.1 Rock chip Sampling A total of 55 rock chip samples were collected, with 28 of these submitted for geochemical analysis. Sampling was undertaken as follow-up of aeromagnetic and photo-feature anomalies and as part of Elkedra’s manganese reconnaissance program developed in conjunction with the regional diamond sampling program in 2002. 4.5.2 Soil Sampling Thirty-six soil samples were collected in traverses undertaken over discrete aeromagnetic anomalies CWN-102, 103, and 104. A total of 61 soil samples were collected as part of a grid within the Chalcedony Hills project area located in the south east corner of the tenement. All samples were sieved to -200micron and submitted to Genalysis for geochemical analysis. The sampling was predominantly targeted around an interpreted 040 trending roll-over structure and a coincident major structural splay.

4.5.3 Stream Sediment Sampling Two stream sediment samples were collected from a single sampling site, targeted for diamond exploration. One sample was screened onsite to -250um+100um and submitted for heavy mineral concentrate analysis. The other sample was screened onsite to -425um and submitted for geochemical analysis.

4.6 Drilling Drilling was undertaken to test a number of different target types including aeromagnetic and photo-feature anomalies, and potential buried palaeo-channels (Plan 3). All drilling results are summarized in Appendix 7. 4.6.1 RC Drilling A total of 16 RC holes were drilled for 1005m into selected discrete magnetic and photo-feature anomalies. Speared, composite drill spoil samples were sent to Ultratrace for geochemical analysis. Unusual intervals and/or intervals with potential kimberlitic geochemical signatures were sent to Diatech for HMC. No kimberlites or volcanic rocks were intersected. Many of the magnetic anomalies were interpreted to be due to sources in the regolith. Possible sources include sink holes, palaeo-channels, in-situ and transported laterites. Many of the targets are narrow linear features with ENE to E-W trends and in some cases there are calcite breccias at surface. These targets have been downgraded based on magnetic anomaly attributes, geological mapping and drilling results. Results of the drilling are summarized in Table 5.

Table 5: Summary of RC drilling.

Hole No. Anomaly Total Depth (m)

Comments

ERC0016 Loc-46 50 Weathered sandstone with clay overlying fresh carbonate at 19m.

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ERC0018 Loc-38 60 Clay, chalcedony, silicified carbonate overlying fresh carbonate at 22m.

ERC0022 Loc-51 50 Clay, chalcedony and silicified limestone.

ERC0023 CWN-095 60 Weathered carbonate and sandstone clays overlying relatively fresh sandstone at 50m.

ERC0024 CWN-103 70 Interbedded weathered sandstone and limestone with clay intervals, quartz; cavities at 60 – 67m.

ERC0025 EDN-017 50 Relatively fresh sandstone and limestone; cavity at 25m. ERC0026 Loc-45 50 Calcrete overlying fresh sandy limestone and dolostone.

ERC0027 CWN-102 78 Ferruginized calcrete overlying clays; no fresh rock intersected.

ERC0028 Loc-40 50 Relatively fresh sandy limestone, limestone.

ERC0029 CWN-093 75 Weathered sandstone & limestone overlying fresh sandy limestone.

ERC0030 Loc-44 50 Sandstone overlying sandy carbonates and dolostone.

ERC0031 Loc-44 50 Sandstone overlying sandy carbonates and dolostone; trace sulfides at 46m.

ERC0032 CWN-091 70 Weathered sandstone & siltstone clays overlying sandy limestone; dolostone at 62m.

ERC0033 CWN-104 108 Clays overlying weathered sandstone; limonitic limestone at 104m. No fresh rock encountered.

ERC0034 CWN-090 80 Highly magnetic clays overlying weathered siltstone & calcareous sandstone.

ERC0035 CWN-090 54 Clays overlying weathered siltstone & calcareous sandstone.

Total 1005

4.6.2 RAB Drilling Five RAB holes were drilled for 65m across Diamond Creek which is a sand-chocked channel depression in the center of the tenement, to test the possibility of buried gravels at this location. Gravels were intersected in all of the drill holes below an unconsolidated sand overburden. Results are summarized in Table 6. Table 6: Summary of RAB drilling.

Hole No. Target Total Depth (m)

Comments

ERB0236 Diamond Creek 15 5m gravel below 4m unconsolidated sand. ERB0237

Diamond Creek 15

1m gravel below 4m unconsolidated sand and 3m calcrete.

ERB0238 Diamond Creek 8 2m gravel below 2m unconsolidated sand. ERB0239 Diamond Creek 15 4m gravel below 4m unconsolidated sand. ERB0240 Diamond Creek 12 4m gravel below 4m unconsolidated sand. Total 65

The gravel intervals from the RAB holes at Diamond Creek were screened to -5mm in the field and composited into one sample (A102165) for heavy mineral concentrate analysis, however record of the exact source intervals for this sample were lost.

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5 LABORATORY RESULTS 5.1 Heavy Mineral Concentrate Analysis Sampling for heavy mineral concentrate analysis included surface sampling (Table 4) and downhole composite sampling from both RAB and RC drilling. Indicator mineral results are given in Appendices 6 and 7. 5.1.1 Surface Sampling A total of 14 surface samples were collected for heavy mineral concentrate analysis. All of the samples were processed at the Diatech Laboratory in Perth. Material was screened at -0.8mm and heavy mineral concentrate routinely observed down to +0.3mm size fraction. The -0.25 to +0.1mm fraction underwent fusion for microdiamond recovery. The -0.1mm slimes were discarded. Stream sediment sample W0046 reported positive for one microdiamond. No diamond indicators or diamonds were recovered from the other surface samples.

5.1.2 RC Drillhole Samples Heavy mineral concentrate analysis was undertaken from 41 selective composite intervals of downhole drill spoils from 6 RC drill holes. All of the samples were processed at the Diatech Laboratory in Perth. Material was screened at -0.8mm and heavy mineral concentrate routinely observed down to +0.25mm size fraction. The -0.25 to +0.1mm fraction underwent fusion for microdiamond recovery. The -0.1mm slimes were discarded. No diamond indicators or diamonds were recovered from any of the samples.

5.1.3 RAB Drillhole Samples The gravel intervals from the RAB holes at Diamond Creek were sent to Striker’s laboratory Perth for processing. The -1.0+0.2mm macrofractions and the -0.2+0.1mm microdiamond fractions were processed with the +1mm material retained pending positive results of the finer fractions. Striker completed observation of the microdiamond fraction. The macrofraction was sent to Global Diamond Exploration Services for observing.

No diamond indicators or diamonds were reported by either laboratory.

5.2 Mineral Chemistry Mineral chemical analytical work and grain identification was carried out by Dr. Wayne Taylor using a JEOL 6400 analytical SEM at the Centre for Microscopy and Microanalysis, University of Western Australia. Analyses were undertaken with a Cameca Camebax and a Cameca SX-100 electron microprobe at the Research School of Earth Sciences, Australian National University, Canberra. Results are summarized in Appendix 6. 5.2.1 Red Sandstone At CWN-090 a dark-red sandstone was identified at two separate outcrop localities over the anomaly. In thin section the rock is composed of angular quartz fragments immersed in a silicified, red-colored haematitic clay matrix of kaolinite and minor barite matrix. Other detrital

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minerals identified include: zircon (relatively common), rare rutile, common Fe-rich ilmenite and rare Mg-ilmenite. SEM analysis of groundmass and detrital minerals of the red sandstone from CWN-090 led to the identification of Fe-rich ilmenite certainly of crustal origin, as well as one Mg-rich ilmenite containing 2.4 wt% MgO. Only a small amount of Cr was detected in the rutiles (<1 wt%). Except for the single Mg-ilmenite, the mineral chemistry of the detrital minerals indicates a crustal origin.

5.3 Geochemistry Geochemistry results are presented in Appendices 6 & 7. Methods and results are discussed below. 5.3.1 Rock chip Sampling Rock samples collected in 2001 were crushed in a mild steel ring mill which has a very low contamination levels for Nb and Ta but potentially can contaminate with Cr and Mn. To check for possible sample contamination from the mill, a repeat sample was crushed in an alumina ring mill. LOI’s were determined on ~1g samples fired at 1,000 degrees C in alumina crucibles. Fusion beads were prepared from the fired residue using one third lithium tetraborate flux and two thirds fired rock powder. The beads were prepared in a muffle furnace at 1,200 degrees C under Ar atmosphere using low-contamination graphite crucibles. Major elements were determined by area scan electron microprobe analysis on the fusion beads which were mounted and polished in epoxy mounts. Trace elements were determined by laser ablation ICPMS using 170 micron spot size; at least two analyses per sample were averaged. Ca was used as the normalization element except in low Ca samples where Ti was used. Rock chip samples collected in 2002 were analysed at Ultratrace Laboratories. Elements were typically analysed by four acid digest with either an MS or OES finish, while oxides were analysed by XRF. The 2003 sampling was sent to Genalysis, Perth and analysed for an extensive multi-element suite using 4 acid digest and OES or MS finishes. 5.3.1.1 Red SandstoneCompared to average (10% trimmed mean) North Australian Craton sandstone and clastic sediment from the AGSO Ozchem database, the red sandstone samples have:

• Higher Al2O3 contents reflecting higher matrix clay content • Lower K2O and Rb contents possibly reflecting lower proportion of detrital K-feldspar

and biotite • Higher TiO2 contents (~0.7 wt% versus 0.3 wt%), Zr contents (00 – 400ppm vs 150 ppm)

and Nb contents (3 ppm vs 7-9 ppm) reflecting higher content of detrital rutile, ilmenite and zircon.

• Elevated HREE contents with unusual V-shaped REE patterns presumably reflecting presence of HREE minerals such as xenotime (YPO4) and secondary equivalents

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• Anomalous but variable Au contents (26 – 129ppb) • Elevated Cr (~60 – 100ppm vs 30-60ppm) suggesting detrital chromite may be present

though it was not detected in thin section. • Elevated Th/U (~6-8 ppm vs ~4ppm)

The unusually high Ti, Cr and REE’s are unusual and not understood. Elevated Ti, Cr, Nb, Zr and LREE’s are characteristic of kimberlites and related alkaline rocks and hence the elevated proportion of these elements warrants further investigation. Reference samples of the bedrock (ie Tomahawk beds, Ninmaroo Fm, etc) need to be analyzed in order to provide better direct comparative geochemistry. The relationship, if any, of this rock to a possible alkaline source rock is not immediately evident. However, it does not appear to be recorded as a recognized member of the sedimentary sequence so not only its geochemistry, but its occurrence is unusual. 5.3.1.2 Other Rock ChipsUnusual geochemical results were reported for several rock chips. At the CWN-090 aeromagnetic anomaly two rock chip samples (D0039 & D0043) reported extremely high values of Ce (5,740 ppm & 1,310 ppm, respectively). Rock chip sample D0054 also reported elevated values of Ce (1,040 ppm) and S (7,168 ppm). 5.3.2 Soil Sampling Ninety-six soil samples were submitted to Genalysis, Perth for analysis. These were analysed for an extensive multi-element suite via four acid digest with either an MS or OES finish. Precious metals were analysed via BLEG.

No significant geochemical anomalies in kimberlite-sensitive elements were recognised from the Chalcedony Hills "roll-over" structure soil geochemistry survey or from the individual line surveys over discrete aeromagnetic anomalies. 5.3.3 Stream Sediment Sampling No significant geochemical results reported from the stream sediment sample. 5.3.4 RC Drilling Two hundred and sixty-one composited spear samples from the RC drilling were submitted to Ultratrace Laboratory for geochemical analysis. Multi-elements were analysed via four acid digest with an MS finish, Au and Pt via aqua regia digest with an MS finish, and major oxides via XRF.

From a base-metal perspective, the best drill intersection is in ERC-0032 drilled into magnetic anomaly CWN-091. Elevated values of Pb (up to 1.43%), Zn (485 ppm), Cu (148 ppm), Ag (0.5 ppm) and Au (up to 27 ppb) were encountered over a 3m (43-46m) interval. The elevated values appear to be associated with a dissolution cavity developed within a weathered siltstone interval at the basal contact with carbonates. Down hole drill spoils at CWN-090 did not report similar Ce values to surface rock chip samples, though elevated S (up to 30,000ppm) was detected in surface drill spoils from ERC-0035 at 1-4m.

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Elevated S (21,000 ppm) was also reported from surface drill spoils (1-4m) at ERC-0018 which was drilled into LOC-38. The highest Au value (62 ppb) reported from drill spoils collected from ERC-0029 at 50-51m which was drilled into aeromagnetic anomaly CWN-093.

6 REFERENCES Debayle, E. and Kennett, B.L.N. (2000) The Australian continental upper mantle: Structure and deformation inferred from surface waves. Journal of Geophysical Research, 105B11, 25423-25450. Kennett, B.L.N. (1997) The mantle beneath Australia. AGSO Journal of Australian Geology & Geophysics, 17(1), 49-54. Van der Hilst, R.D., Kennett, B.L.N. and Shibutani, T (1998) Upper mantle structure beneath Australia from portable array deployment. In: J. Braun et al, editors. Structure and Evolution of the Australian Continent. 39-57.


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