s3-ap-southeast-2.amazonaws.com€¦ · Web viewTechnical Report 3762. Exploration Permits for Minerals Nos. 11524 ‘Slaughteryard. North’, 12886 ‘Ding. Dong’, 13098 ‘North

Technical Report 3762

Exploration Permits for Minerals Nos.11524 ‘Slaughteryard North’, 12886 ‘Ding Dong’,

13098 ‘North Branch Creek’ and14567 ‘Mosses Bore’, Queensland,

Combined Annual Reportfor the Period Ending 11 May 2010

XSTRATA COPPER EXPLORATION PTY LTD

TECHNICAL REPORTNo. 3762

TITLE: EXPLORATION PERMITS FOR MINERALS NOS.11524 ‘SLAUGHTERYARD NORTH’,12886 ‘DING DONG’, 13098 ‘NORTH BRANCH CREEK’ AND 14657 ‘MOSSES BORE’, QUEENSLAND, COMBINED ANNUAL REPORT FOR THE PERIOD ENDED 11 MAY 2010

HOLDER: MOUNT ISA MINES LIMITED

OPERATOR: XSTRATA COPPER EXPLORATION PTY LTD

1:250,000 SHEET: SF54-01 ‘MOUNT ISA’

1:100,000 SHEET: 6756 ‘MOUNT ISA’

INVESTIGATIONS DEEP YELLOW LIMITEDCONDUCTED BY: XSTRATA COPPER EXPLORATION PTY LTD

AUTHORS: JAMES HARVEY JED WILLIAMS

SUBMITTED BY: XSTRATA COPPER EXPLORATION PTY LTD

DATE: MAY 2010

DISTRIBUTION

1. Xstrata Copper Exploration Pty Ltd, Mount Isa Library

2. Department of Mines and Energy, Brisbane

3. Xstrata Copper Exploration Pty Ltd, Exploration Library

4. Deep Yellow Ltd, Mt Isa

5. Deep Yellow Ltd, Perth

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LIST OF CONTENTS

1 INTRODUCTION.....................................................................................1

2 LOCATION AND ACCESS........................................................................1

3 TENURE.................................................................................................2

4 EXPLORATION RATIONALE.....................................................................3

5 PREVIOUS EXPLORATION.......................................................................4

6 REGIONAL GEOLOGY.............................................................................6

7 WORK COMPLETED DURING THE CURRENT REPORTING PERIOD..........77.1 REVERSE CIRCULATION (RC) DRILLING.......................................................................77.2 DIAMOND CORE (DC) DRILLING...............................................................................12QAQC, PYCNOMETRY AND MULTIELEMENT ANALYSIS....................................................137.3 PETROLOGICAL STUDIES.............................................................................................137.4 JORC CODE RESOURCE ESTIMATE............................................................................157.5 REHABILITATION..........................................................................................................177.6 FIELD XRF SURVEY....................................................................................................197.7 RECONNAISSANCE MAPPING.......................................................................................21

8 CONCLUSIONS AND RECOMMENDATIONS...........................................22

9 REFERENCES.......................................................................................23

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Figure No Title LIST OF FIGURESFigure 1 Frida Field XRF Copper Results.Figure 2 Field Assay Results From the Goya Prospect

Table No Title

LIST OF TABLES

Table 1 Isa West Project Area Tenement DetailsTable 2 Summary of Exploration History over the Isa West AreaTable 3 RC Drill Hole SummaryTable 4 RC Drill Hole ResultsTable 5 Diamond Core Drill Hole SummaryTable 6 Diamond Core Drill Hole ResultsTable 7 Petrological Sample DetailTable 8 Bambino Prospect, Mineral AbundanceTable 9 Bambino Prospect, Elemental Deportment Mass % UTable 10 Thanksgiving Prospect Mineral AbundanceTable 11 Thanksgiving Prospect, Elemental Deportment Mass % UTable 12 Isa West Projects - January 2010 JORC Code Resource Estimate Table 13 Isa West Rehabilitation Summary by Prospect

LIST OF DRAWINGS

Drawing No61023

TitleIsa West Location and Sub-block Details

Scale

EPMs 11524, 12886, 13098, 14657 1:250,00061031 Isa West General Geology 1:250,000

Appendix No Title

LIST OF APPENDICES

Appendix 1 Drill Hole DataAppendix 2 Raw Downhole Gamma DataAppendix 3 Assay and Soil Data

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SUMMARY

Aim of Project

The tenements comprising the Isa West project area were primarily obtained to explore for metasomatic copper-gold mineralisation within the Sybella Granite Complex and within the sedimentary and volcanic rocks surrounding the complex.

In January 2008, Deep Yellow Limited (DYL) entered into a joint venture with Mount Isa Mines Limited, a wholly owned subsidiary of Xstrata plc, to explore for uranium deposits similar in nature to the Mesoproterozoic Valhallah Uranium Deposit located approximately 20km north of the project area.

Object of Report

To report on exploration carried out for the period ending 11 May 2010 for the Isa West project area which consists of four Exploration Permits for Minerals (EPMs) 12886 ‘Ding Dong’, 11524 ‘Slaughteryard North’, 13098 ‘North Branch Creek’, and 14657 ‘Mosses Bore’.

Location

The four permits form a contiguous block west of Mount Isa with a few isolated blocks to the north and east of Mount Isa Ml 8058. The centre of the main block occurs approximately 7 kilometres northwest of the Mount Isa mine.

Tenure

EPM 11524 ‘Slaughteryard North’ was granted to Mount Isa Mines Limited over an area of 4 sub-blocks for a period of five years from 12 May 2003. On 16 February 2009, EPM 11524 was renewed in its entirety for a further five years to 11 May 2013. A request to waiver the one sub-block relinquishment scheduled for 12 May 2010 was submitted to the department on 12 March 2010.

EPM 12886 ‘Ding Dong’ was granted to Mount Isa Mines Limited over an initial area of 80 sub-blocks for a period of five years from 12 May 2003. 17 sub-blocks were relinquished in 2005 with 63 sub-blocks retained. On 23 March 2009, EPM 12886 was renewed in its entirety for a further five years to 11 May 2013. A request to waiver the 31 sub-block relinquishment scheduled for 12 May 2010 was submitted to the department on 12 March 2010.

EPM 13098 ‘North Branch Creek’ was granted to Mount Isa Mines Limited over an area of 29 sub-blocks for a period of five years from 12 May 2003. On 16 March 2009, EPM 13098 was renewed in its entirety for a further five years to 11 May 2013. A request to waiver the 24 sub-block relinquishment scheduled for 12 May 2010 was submitted to the department on 12 March 2010.

EPM 14657 ‘Mosses Bore’ was granted to Mount Isa Mines Limited over an area of 53 sub- blocks for a period of five years from 02 August 2005. 22 sub-blocks were relinquished from EPM 14657 in 2008 and a further 7 sub-blocks surrendered in 2009 leaving the currently held 24 sub-blocks.

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Previous Exploration

Uranium mineralisation was discovered in the area in 1954 and has been the focus of prospect scale exploration involving surface geochemical surveys, various geophysical surveys and minor shallow drilling. A number of other prospects adjacent to the Sybella Granite have been historically worked for uranium, mica, tin, beryllium and silica.

In recent years Xstrata has targeted metasomatic copper-gold mineralisation. Several airborne magnetic and radioactive surveys have covered various sections of the EPMs. Geological mapping, ground radiometric, gravity, electromagnetic (EM) and induced polarization (IP) surveys have also been completed on various parts of the project area. Surface geochemistry (soil, stream and rock) has identified sporadic copper, uranium and gold mineralisation within the batholith and in the adjacent metamorphic, sedimentary and volcanic units of the Haslingden Group and Myally Subgroup.

Exploration Work Completed by DYL to 11 May 2010

Highlights of the work completed during the year to 11 May 2010 were: Reverse Circulation (RC) Drilling

Focused drilling on four prospects 92 RC drill holes for a total of 11,453 metres 3453 RC drill chip samples analysed for U3O8 Downhole gamma logging of all RC drill holes

Diamond Core (DC) Drilling 8 DC drill holes for a total of 775.6 metres 250 samples analysed for U3O8 Downhole gamma logging of all DC drill holes

QAQC, Pycnometry and Multielement Analysis 546 pulps from 2008/09 drilling submitted to umpire laboratory 510 field resplits from 2009 drilling submitted to umpire laboratory 725 pulps and field resplits submitted for pycnometry 211 samples submitted for multielement analysis

Petrological Studies 8 samples submitted for petrology and uranium species analysis

JORC Resource Estimate Coffey Mining Pty Ltd appointed as resource consultants Surtron Technologies contracted to survey all drill holes included in the

resource estimate JORC Code Resource estimate completed for three prospects

Rehabilitation All DYL drill sites from 2008/09 programmes have been rehabilitated

Conclusions and Recommendations

The work conducted within the Isa West tenements during the year ending 11 May 2010 has elevated a number of the historic uranium prospects to JORC Code Resources. Further exploration to ascertain the economic potential of the uranium mineralisation is required and will be undertaken in the year to May 2011.

May 1 EPMs: 12886 ‘Ding Dong’, 11524 ‘Slaughteryard North’, 13098 ‘North Branch Creek’ and 14657

‘Mosses Bore’

1 INTRODUCTION

For the purpose of reporting, the area known as Isa West comprises four contiguous tenements granted to Mount Isa Mines Limited (MIM) namely:

EPM 11524 ‘Slaughteryard North’ EPM 12886 ‘Ding Dong’EPM 14657 ‘Mosses Bore’EPM 13098 ‘North Branch Creek’

The EPMs cover a large north-south orientated area that is centred approximately 7 kilometres northwest of the Mount Isa Mine.

The tenements cover geological terrane that is considered to have high copper-gold and uranium mineralisation potential. The joint venture entered into by Xstrata and DYL aims to maximise this mineralisation potential. This report outlines exploration undertaken by Xstrata, formerly MIM Exploration Pty Ltd (MIMEX) and DYL, for the period ending 11 May 2010. The report describes soil geochemistry, geological mapping, rockchip sampling, geophysics and RC drilling without regard to the separate tenements.

2 LOCATION AND ACCESS

The location and sub-block distribution of all four tenements are shown on Drawing No. 61023.

EPM 11524 ‘Slaughteryard North’ is centred approximately 10 kilometres northwest of the Mount Isa Mine and is bounded by latitudes 20°39' and 20°41' south and longitudes 139°22' and 139°25'.

EPM 12886 ‘Ding Dong’ is centred approximately 10 kilometres southwest of the Mount Isa Mine and is bounded by latitudes 20°56' and 20°39' south and longitudes 139°24' and 139°28' east.

EPM 13098 ‘North Branch Creek’ is centred approximately 13 kilometres northwest of the Mount Isa Mine and is bounded by latitudes 20°29' and 20°44' south and longitudes 139°20' and 139°31'.

EPM 14657 ‘Mosses Bore’ is centred approximately 23 kilometres northwest of the Mount Isa Mine and is bounded by latitudes 20°54' and 20°63' south and longitudes 139°27' and 139°42'.

Access to the northern half of the Isa West permits is via May Downs Station gravel road off the Barkly Highway, west of Mount Isa. The southern half of the project area is traversed by the single lane sealed Diamantina Development Road. Numerous station tracks provide vehicular access to the rest of the EPMs.


‘Mosses Bore’

3 TENURE

A summary of tenure is listed in Table 1 and locations are shown on Drawing No. 61023.

EPMNo. EPM Name Original

Grant DateCurrent Expiry

Date

Original Size (No. of Sub-

Blocks)

Present Size (No. of Sub-

Blocks)11524 Slaughteryard

North12 May 2003 11 May 2013 4 4

12886 Ding Dong 12 May 2003 11 May 2013 80 6313098 North Branch

Creek12 May 2003 11 May 2013 29 29

14657 Mosses Bore 2 Aug 2005 1 Aug 2010 53 24Table 1: Isa West Project Area Tenement Details

The current sub-block details for EPM 11524 Slaughteryard North are described below:

BIM Block Sub-BlocksCLON 521 zCLON 593 c, d, eTotal 4 sub-blocks

The current sub-block details for EPM 12886 Ding Dong are described below:

BIM Block Sub-BlocksCLON 522 v, w, xCLON 593 p, t, u, x, y, zCLON 594 a, b, c, f, g, h, l, m, q, r, v, wCLON 665 b, c, d, e, g, h, j, k, m, n, o, p, s, t,

u, x, yCLON 666 a, b, l, m, n, q, r, s, w, xCLON 737 c, d, e, k, zCLON 738 c, h, n, s, v, w, xCLONTotal

810 a, b, c63 sub-blocks

Sub-block details for EPM 13098 North Branch Creek are described below:

BIM Block Sub BlocksCLON 377 xCLON 449 p, u, zCLON 450 f, l, p, q, vCLON 521 s, t, u, x, yCLON 522 a, f, l, q, rCLON 523 vCLON 593 a, b, f, g, h, l, m,

q, rTotal 29 sub-blocks


‘Mosses Bore’

The current sub-block details for EPM 14657 Mosses Bore are described below:

BIM Block Sub-BlocksCLON 449 l, m, q, r, v, w, x, yCLON 520 eCLON

Total

521 a, b, c, d, e, f, g, h, j, k, l, m, n, o, p

24 sub-blocks

4 EXPLORATION RATIONALE

Collectively, the area has been targeted for metasomatic copper-gold for both volcanic-hosted and intrusion-hosted styles of mineralisation (Drawing No. 61031). The exploration methods used for the Isa West area provide adequate data in both geological environments to enable discovery of either style. Most recently, surface reconnaissance has found further areas of significant copper-gold mineralisation in the Eastern Creek Volcanics (ECV). Stream sediment geochemistry has also suggested additional potential for shear/vein hosted gold mineralisation within the Haslingden Group on the eastern flank of the Ding Dong Permit.

In the northern portion of the Isa West area, specifically the North Branch Creek, Slaughteryard North tenements and the eastern part of the Ding Dong tenement, structurally controlled copper-gold mineralisation has been explored within prospective sediments and volcanic rocks of the Eastern Creek Volcanics and May Downs Gneiss.

Although historic exploration in the Sybella Granite Complex has focussed on uranium mineralisation, in recent years MIM has explored for ironstone and skarn hosted copper-gold. This targeting rationale was originally developed on the large coincident magnetic-gravity anomaly occurring within the Sybella Granite immediately west of the Ding Dong Permit. This anomaly was interpreted to be similar to that of the Olympic Dam copper-gold-uranium- rare earth elements deposit in South Australia. In addition small-scale copper-gold mineralisation occurs at the King Prospect (Towsey 1982) and copper-gold mineralisation hosted in pegmatites within the May Downs Gneiss was recently identified at the Dali Prospect by MIMEX geologists (A-Izzeddin and Johnson, 2003). In addition, reconnaissance prospecting within the area has revealed the potential for shear hosted copper-gold mineralisation, possibly associated with the nearby Sybella and Kitty Plains Granite intrusions. Recent geochronological dating of pegmatites in the area has identified D3 ages (syn-Isa copper mineralisation) for these intrusions. All this suggests there may be the presence of hidden Williams-Naraku style intrusions that may be associated with metasomatic ironstone copper-gold mineralisation like that currently being exploited in the Eastern Succession (e.g. Ernest Henry).

Uranium exploration conducted by DYL has predominantly focussed on exploration for mineralisation similar to that displayed at the Valhalla prospect, which is located 20km to the North of the Isa West tenements. The Valhalla mineralisation is predominantly hosted within meta-basalts belonging to the Eastern Creek Volcanics intercalated with meta-sedimentary sequence of fine grained sandstones and course grained siltstones.The Valhalla “mine” sequence extends south into the Isa West tenement area and to


‘Mosses Bore’

date, these meta-basalts have been the main focus of uranium exploration within the eastern portion of the tenements. Within the Western portion of the tenements further areas of interest, displaying radiometric, magnetic and gravity anomalies have been identified from airborne radiometric survey data collected by UTS in 2006. These areas of interest lie within


‘Mosses Bore’

sedimentary deposits intruded by the Sybella Granite complex, a geological setting historically identified as potential host to uranium mineralisation.

5 PREVIOUS EXPLORATION

The Isa West tenements have been explored sporadically since 1954 when uranium was first discovered, with a focus on a distinct line of shear-hosted uranium deposits within the northeastern part of the project area. Historic exploration involving minor shallow drilling, surface geochemistry and various geophysical surveys was carried out over the mineralised area.

A number of other prospects adjacent to the Sybella Granite have been historically worked for uranium, mica, tin, beryllium and silica.

More recently, prospecting activity has been directed towards copper-gold mineralisation.

The project area has historically been covered by several ATPs and EPMs, and numerous small mining leases which were pegged over individual prospects. The majority of historical work was conducted by MIM, although a few other companies also conducted work (Table 2).

Year Prospect Company Mineralisation1964 Mount Guide Mount Isa Mines

LimitedCu, Au

1969-1970 ATP618M, ATP619M, ATP620M Eastern Copper Mines NL

U, Cu

1969 ATP467M Queensland Mines Ltd U1970 ATP967M Spear Creek

ProjectEsso U

1973 ATP1132M Exoil NL Be1973 ATP1193M Savage Exploration Pty

LtdU

1979 ATP1551M Mount Isa Mines/CEC Sn, Cu-Ag-Bi1980-1983 ATP2264 Sybella Mount Isa Mines

LimitedCu, Sn

1987-1989 ATP5020 Mount Isa Mines Limited

Au, Cu

1991 ATP6001M Mount McArthur Mount Isa Mines Limited

Cu, Ag-Pb-Zn, Au

1991 EPM 5974 Stone Axe Mount Isa Mines Limited

Cu, Ag-Pb-Zn, Au

1994 - present

EPM 9585 Slaughter Yard Mount Isa Mines Limited

Cu-Au

2007- present EPM 9585, 12886, 13098,11524

Deep Yellow Limited U

Table 2: Summary of Exploration History over the Isa West Area (Compiled From Open File Reports)

Magnetic and radiometric surveys and broad spaced stream sediment sampling dominated early uranium exploration conducted by Eastern Copper Mines, Queensland Mines Ltd and Esso. Anomalies defined by these surveys were followed up by reconnaissance mapping and in some instances soil sampling and rockchip sampling. Some copper, lead and zinc anomalies were interpreted to be caused by proximity to the smelter.

Exoil NL explored for beryllium in pegmatites at Mica Creek area in 1973. They


‘Mosses Bore’

conducted detailed mapping on 11 defined areas (A-L) and took 233 rockchips on grid lines at 1000m spacings and also collected 6 stream sediment samples. Queensland Mines Ltd conducted detailed work on the Bambino Uranium Prospect, which included costeans and a single 150 feet RC drillhole.Carpentaria Exploration defined a lead-bearing gossan at the Duchess Rd Prospect (located at approximately 338200E, 7687700N AMG) in 1979. The zone was rock chipped on 3 lines at 50m spacings then ‘drill tested’ by 3 shallow holes (PDH1, 2 and 3) with final depths of 21, 27 and 21m respectively. The maximum lead assay returned was 780ppm over 1.5m in hole 2.


‘Mosses Bore’

MIM completed work on ATP 2264M ‘Sybella’ which covered the southern half of EPM 12886 between 1980 and 1982. The exploration work targeted copper and tin. The work completed included geological mapping, geophysical surveys, geochemical surveys and diamond drilling. The following is summarised from Towsey (1982).

Reconnaissance mapping was undertaken at 1:23,700 scale. Areas of interest were remapped at 1:5000 scale, however mineralisation was not defined. An airborne magnetics and radiometrics survey was flown in early 1981 at an altitude of 120m on line spacings of 400m. Readings were taken for potassium, uranium and thorium. Gravity measurements were taken as part of a general regional study. A stream sediment survey was conducted over the Sybella Granite and samples were analysed for tin, nickel and tantalum. Detailed rockchip studies followed up this streams survey and a new 2km by 400m zone of anomalous (>60ppm) tin was delineated south of the Mica Creek tin mine (over the Little Leslie tin deposit). The tin grades from this prospect were not considered to be economic.

The King Prospect was the prime focus of follow-up surveys. Detailed surveys included gravity measurements, a small-scale stream sediment survey (assays for copper, silver, lead and zinc) and a rockchip program over the prospect. The rockchips confirmed the copper anomaly over a strike length of 400m and a vegetation anomaly of 600m strike extension. Petrology was performed on several samples from the King Prospect. Six diamond drillholes totalling 900m were completed around the King in 1982. The holes were targeted on geological, geochemical and geophysical targets. Results were disappointing and the best bulked results from the King lode included 6.8m @ 0.41% Cu (including 1.4m @ 1.36% Cu and 0.63ppm Au) in drillhole PJ386ED1 and 6m @ 0.68% Cu including 1m @ 1.07% Cu, 1ppm Au and 6ppm Ag in PJ388V1. This was considered to be too small for the company and the ATP was allowed to lapse in January 1983.

During the mid - 1990s, as part the evaluation of magnetic anomalies within the Sybella Granite, MIM conducted a stream sediment sampling program over the area. They also completed a 1km by 1km spaced gravity survey and took soil samples at each station on EPM 9585 Slaughter Yard. In the same year SIROTEM electromagnetic (EM) soundings were recorded using a 500m loop by Solo Geophysics. Further work during the 1990s by MIM continued to focus on the coincident magnetic-gravity high covered by the current Slaughter Yard EPM.

Recent work includes the 2004 Fugro airborne magnetic and radiometric survey. The Sandy Creek survey had a total coverage of 4,607 line kilometres, with 731 line kilometres of data collected over the Ding Dong EPM12886.

The potassium channel displays a clearly elevated area in the southern part of the survey in the EPM and there are two discrete elevated potassium anomalies on the east side of the survey in the EPM. The uranium channel has some elevated areas coincident with the high potassium area in the south of the survey. However, more notable is the discrete elongated uranium anomalies in the north east of the survey within the EPM.


‘Mosses Bore’

6 REGIONAL GEOLOGY

The Isa West tenements are located on the ‘Mount Isa’ 1:100 000 Geological Sheet (6756) which was jointly mapped by the Australian Geological Survey Organisation (AGSO) and the Queensland Geological Survey (GSQ). In recent years, this work has been supplemented by geology students and researchers from various Australian universities.

The project area covers part of the Western Fold Belt of the Mount Isa Inlier. A large part is underlain by the Sybella Granite, which intrudes rocks of the Haslingden Group, which is part of Cover Sequence 2 and is thought to have been deposited during a rift-sag fill cycle of events. This group comprises the Mount Guide Quartzite, including the May Downs Gneiss Member, unconformably overlain by the Eastern Creek Volcanics which are in turn unconformably overlain by the Myally Subgroup. A Cambrian capping overlies the Sybella Granite in the northwestern part of the area while elsewhere, particularly in the north and northwest, there is a cover of Cainozoic and Quaternary alluvium.

The Sybella Batholith forms a large north-south elongate zone and covers an area of over 1600km². It is interpreted as an A-type composite granitoid complex, divisible into several phases, intruded during an extensional phase during the development of the Mount Isa Basin. The western contact of the batholith is fault bounded by the May Downs Fault against the McNamara Group (Mount Isa Group equivalents). The eastern and northern contacts with the country rocks are of the normal intrusive type and are generally sub parallel to stratigraphy.

At least two generations of pegmatites have been identified in the area. Both phases are younger than the Sybella Batholith.

West of the Mount Isa Fault the Eastern Creek Volcanics are subdivided into quartzites and metabasalts/amphibolites, and metasediments (predominantly schists and quartzites).

Rocks in the area have been multiply deformed, metamorphosed and metasomatised. Metamorphic grades reached upper amphibolite facies with metamorphic grade increasing westwards from the Mount Isa Fault towards the Sybella Granite.

The area is also marked by major fault zones and several periods of faulting, associated with pulses of mineralisation. Major trend directions in the project area are the main north-south trend (Mount Isa Fault), a north-northwest trend and a northeast trend.

There is some debate over the deformation history of the local area; the main issue being over the existence of a pre Sybella age fabric which has resulted in different classifications of the deformation events (Connors and Page (1995), Page and Bell (1986) and Connors et al., (1992)). Connors et al (1992) conducted the most detailed study over the southern part of the Permit area where they defined multiple deformational phases that occurred during metamorphism during the Isa Orogeny (1610-1480 Ma). The deformation phases are:

D1 folds and cleavages which are rare in the country rocks and do not occur within the granite. S1 is in places parallel to S0.

D2 folding on all scales and a penetrative S2 cleavage, which is the


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dominant fabric across the entire Mount Isa Block.D3 comprised of initial D3a shearing followed by mesoscopic to

megascopic D3b folding which is observed in large scale folds in the southern portion of the batholith.

D4 and D5 recognised only in the country rocks and not in the batholith.


‘Mosses Bore’

The effects of D1 through to D4 have been previously mapped by MIM geologists in the King Prospect area in the southern part of the permit.

7 WORK COMPLETED DURING THE CURRENT REPORTING PERIOD

Exploration programmes for year ending 11 May 2010 comprised:Reverse Circulation (RC) Drilling Diamond Core (DC) DrillingQAQC, Pycnometry and Multi Elements Analysis Petrological StudiesJORC Code Resource Estimate RehabilitationField XRF Survey Recon Mapping

7.1 Reverse Circulation (RC) Drilling

A RC Drilling programme was conducted during the reporting period, for a total of 11,453 metres in 92 holes at three different prospects; Bambino, Thanksgiving and Turpentine. The drilling programme occurred from 12 May - 17 October 2009. Two drill rigs were active on the property. Ryan Drilling provided a Schramm 450 and Tom Browne Drilling provided a Schramm 880. Table 3 is a summary of the holes drilled. A total of 3,453 samples were collected and analysed by XRF for U3O8. Samples were selected based on downhole gamma logging using Auslog equipment and Well Vision software. Table 4 lists all holes drilled showing significant mineralised intervals based on a cut-off grade of 200 ppm U3O8. Complete drill logs and assay results are contained within Appendix 1. Equivalent U3O8 was calculated from downhole gamma log readings and the raw data is provided in Appendix 2.

EPM Prospect Name No. RCHoles

Metres Drilled

Samples collected

EPM 12886 Bambino 38 5220 1595EPM 12886 Thanksgiving 44 5411 1500EPM 11524 Turpentine 10 822 358

Total 92 11453 3453Table 3: RC Drill Hole Summary

Prospect DrillholeDepth (m) Interval

(m)U3O8

(ppm)From ToBambino BBRC021 20 21 1 1250

30 33 3 22047 51 4 473

BBRC022 75 78 3 21388 89 1 40094 95 1 230

131 137 6 225BBRC023 64 65 1 220

106 113 7 277BBRC024 2 3 1 250

14 15 1 250


‘Mosses Bore’

29 35 6 396


‘Mosses Bore’


(m)U3O8


53 65 12 27271 82 11 698

BBRC026 51 52 1 360BBRC027 NSABBRC028 19 27 8 203

41 42 1 50047 49 2 295

BBRC029 107 132 25 532BBRC030 0 27 27 464BBRC031 161 182 21 298

161 172 11 438BBRC032 90 94 4 350

97 110 13 403BBRC033 7 11 4 391BBRC034 113 134 19 411

124 132 8 799BBRC035 9 20 11 495BBRC036 150 157 7 395BBRC037 18 20 2 360BBRC038 78 80 1 460

85 87 2 480144 146 2 610

BBRC039 38 44 6 348BBRC040 78 82 4 332BBRC041 28 29 1 290

60 64 4 405BBRC042 17 25 8 598BBRC043 157 158 1 600

180 193 13 304201 218 17 428

BBRC044 172 195 23 384184 195 11 543

BBRC045 202 213 11 448*BBRC046 NSRBBRC047 NSRBBRC048 27 29 2 168BBRC049 24 30 6 164

38 43 5 27850 51 1 185

BBRC050 152 153 1 160163 168 5 508177 179 2 215186 187 1 260

BBRC051 100 106 6 231152 154 2 272210 211 1 207227 228 1 626

BBRC052 198 209 11 293219 220 1 312


‘Mosses Bore’


(m)U3O8


178 214 36 405205 208 3 866

BBRC054 95 110 15 32795 98 3 750

190 216 26 368194 209 15 509

BBRC055 269 295 26 224283 288 5 432

BBRC056 102 113 11 283BBRC057 41 55 14 295

41 49 8 370155 166 11 236

Thanksgiving TGRC009 27 82 55 55532 51 18 1063

TGRC010 10 11 1 44023 38 15 26736 37 1 850

TGRC011 50 59 9 42767 68 1 200

TGRC012 6 8 2 42511 13 2 35518 21 3 34131 32 1 30040 47 7 60751 52 1 22059 60 1 155

TGRC013 38 39 1 32054 59 5 32463 66 3 300

TGRC014 51 52 1 24055 58 3 2170

TGRC015 55 66 11 49559 63 4 1009

TGRC016 53 54 1 650TGRC017 35 36 1 180

42 43 1 17058 66 8 39961 65 4 67575 80 5 413

TGRC018 73 74 1 10577 78 1 13588 91 3 383

101 103 2 195TGRC019 39 42 3 408TGRC020 NSATGRC021 NSATGRC022 NSATGRC023 51 72 21 490

91 94 3 296


‘Mosses Bore’


(m)U3O8

(ppm)From ToThanksgiving 104 106 3 825

TGRC024 79 95 16 402111 115 4 534125 127 2 320

TGRC025 25 29 4 453TGRC026 46 51 5 425

74 82 6 23781 82 1 1400

TGRC027 25 28 3 220TGRC028 76 87 11 247TGRC029 23 30 7 393

28 30 2 1020TGRC030 65 75 10 515TGRC031 14 16 2 430

76 78 2 223TGRC032TGRC033TGRC034 9 11 2 265TGRC035 44 53 9 417

61 63 2 570TGRC036 16 19 3 370

28 41 13 507TGRC037 71 81 10 413TGRC038 17 18 1 380

34 35 1 47045 53 8 436

TGRC039 64 65 1 40092 98 6 343

TGRC040 27 35 8 49347 48 1 750

TGRC041 102 103 1 450TGRC042 18 21 3 290

30 32 2 330TGRC043 47 48 1 550TGRC044 69 90 21 234

101 119 18 224130 132 2 750

TGRC045 125 152 27 420163 164 1 430

TGRC046 183 222 39 394183 210 27 471220 222 2 917

TGRC047 180 213 33 404TGRC048 136 138 2 900

160 162 2 373167 175 8 247191 192 1 600

TGRC049 127 128 1 1100182 183 1 300215 216 1 290


‘Mosses Bore’


(m)U3O8

(ppm)From ToThanksgiving TGRC050 182 222 40 213

190 195 5 494210 222 12 327

TGRC051 231 264 33 369231 237 6 578246 264 18 454

TGRC052 195 200 5 234238 243 5 232259 261 2 560

Turpentine TURC007 30 43 13 276TURC008 18 21 3 297

29 38 9 444TURC009 37 39 2 290

45 56 11 29448 51 3 533

TURC010 14 16 2 34527 39 12 27529 34 5 392

TURC011 41 51 10 482TURC012 28 37 9 505

29 33 4 863TURC013 31 41 10 245

37 41 4 470TURC014 55 64 9 234TURC015 29 32 3 NSRTURC016 NSR

Table 4: RC Drill Hole ResultsNSA – No Samples Analysed, NSR – No Significant Results


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7.2 Diamond Core (DC) Drilling

A DC Drilling Programme was conducted during the reporting period, for a total of 775.6 metres in 8 holes at the Bambino, Eldorado North and Thanksgiving prospects. The drilling programme occurred from 7 July to 3 August 2009. Ryan Drilling provided a UDR 1200 for the programme. Table 5 is a summary of the holes drilled. Table 6 lists all holes drilled showing significant mineralised intervals based on a cut-off grade of 200 ppm U3O8. Samples were selected based on downhole gamma logging using Auslog equipment and Well Vision software. Complete drill logs and assay results are contained within Appendix 1. Equivalent U3O8 was calculated from downhole gamma log readings and the raw data is provided in Appendix 2.

Tenement Prospect NameNo. RCHoles

Metres Drilled

EPM 12886 Bambino 4 429.8EPM 12886 Thanksgiving 3 270.6EPM 12886 Eldorado North 1 75.2

Total 8 775.6Table 5: Diamond Core Drill Hole Summary


(m)U3O8

(ppm)From ToThanksgiving TGDC001 24 70 46 480

TGDC002 52 57 5 69466 79 13 528

TGDC003 51 56 5 586Bambino BBDC001 60 75 15 575

BBDC002 42 44 2 46052 81 29 464

BBDC003 84 94 10 919BBDC004 49 50 1 500

64 67 3 40387 96 7 477

107 109 2 650113 118 5 236

Eldorado North ENDC001 38 58 20 856

Table 6: Diamond Core Drill Hole Results


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QAQC, Pycnometry and Multielement Analysis

After the completion of RC Drilling in October 2009 and, in addition to QAQC procedures of blanks and standards representing 6% of all samples submitted, a further programme was initiated to confirm the homogeneous nature of the metre samples collected from the Bambino and Thanksgiving Prospects and the accuracy of the primary laboratory, Amdel Limited, Mount Isa. A total of 510 duplicate field resplits were collected from the retention bags at the two prospects and submitted to the umpire lab, ALS Laboratory Ltd, Mount Isa. In addition, 546 pulp returns from the primary lab were also submitted to the umpire lab. The 1056 pulps and field split samples submitted for the QAQC programme represent 26% of the original samples submitted.

Results from the QAQC programme can be found in Appendix 1. The results demonstrated repeatability and accuracy to < +/- 2% from the original sample and were within tolerance for JORC Code Resource work.

Further test work included 725 samples submitted for pycnometry (specific gravity) tests and 211 samples submitted for ICP-MS Multielement analysis, (ALS code: ME-MS61). Below is a list of elements and ranges the 211 samples were tested for.

Analytes & Ranges (ppm)

Ag 0.01-100 Cu 0.2-10,000 Na 0.01%-10% Sr 0.2-10,000Al 0.01%-50% Fe 0.01%-50% Nb 0.1-500 Ta 0.05-100As 0.2-10,000 Ga 0.05-10,000 Ni 0.2-10,000 Te 0.05-500Ba 10-10,000 Ge 0.05-500 P 10-10,000 Th 0.2-10,000Be 0.05-1,000 Hf 0.1-500 Pb 0.5-10,000 Ti 0.005%-

10%Bi 0.01-10,000 In 0.005-500 Rb 0.1-10,000 Tl 0.02-10,000Ca 0.01%-50% K 0.01%-10% Re 0.002-50 U 0.1-10,000Cd 0.02-1,000 La 0.5-10,000 S 0.01%-10% V 1-10,000Ce 0.01-500 Li 0.2-10,000 Sb 0.05-10,000 W 0.1-10,000Co 0.1-10,000 Mg 0.01%-50% Sc 0.1-10,000 Y 0.1-500Cr 1-10,000 Mn 5-100,000 Se 0.2-1,000 Zn 2-10,000Cs 0.05-500 Mo 0.05-10,000 Sn 0.2-500 Zr 0.5-500

7.3 Petrological Studies

Eight samples were submitted to SGS Brisbane for petrographic studies using QEMSCAN and optical mineralogy to determine mineral make up and uranium species. Samples were selected from highly mineralised zones at the Bambino and Thanksgiving Prospects to provide the best opportunity to determine uranium species. The sample detail and petrographic observations are given below:

Tenement EPM Prospect Sample No Hole No

Depth (m) U3O8 (ppm)

12886 Bambino AUS 001 BBRC025 72-73 1,90012886 Bambino AUS 002 BBRC029 111-112 2,30012886 Bambino AUS 003 BBRC034 129-130 1,80012886 Bambino AUS 004 BBRC042 21-22 1,70012886 Thanksgiving AUS 005 TGRC023 64-65 2,55012886 Thanksgiving AUS 006 TGRC009 42-43 1,85012886 Thanksgiving AUS 007 TGRC014 55-56 3,25012886 Thanksgiving AUS 008 TGRC036 33-34 2,700


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Table 7: Petrology Sample Detail

Bambino Prospect

Minerals

AUS001 (BB):

AUS002 (BB):

AUS003 (BB):

AUS004 (BB): 0 20 40 60 80 100

Uraninite Coffinite BranneriteBrannerite-Silicates Intergrowths Uranophane-betaCalciouranoite Other U MineralsUranium-Silicates Intergrowths Uranium-FeOX Intergrowths REEFe Oxides Ti Oxides Carbonates Sulphides Apatite Quartz Feldspars Pyroxenes Amphiboles Sphene Chlorite MicasOther silicates Others

Mass (%)


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Table 8: Bambino Prospect, Mineral Abundance

Mass U (%) Samples

MineralsAUS001(BB):

AUS002(BB):

AUS003(BB):

AUS004(BB):

Uraninite 27.70 8.82 58.25 12.09Coffinite 4.58 9.48 9.37 3.57Brannerite 0.51 0.63 1.42 2.25Brannerite-Silicates Intergrowths 0.00 0.18 0.05 4.77Uranophane-beta 16.48 17.80 4.72 25.38Calciouranoite 9.94 23.11 3.38 1.83Other U Minerals 0.37 0.67 0.47 0.48Uranium-Silicates Intergrowths 39.54 38.42 21.56 49.41Uranium-FeOX Intergrowths 0.87 0.89 0.79 0.22Total 100.00 100.00 100.00 100.00

Table 9: Bambino Prospect, Elemental Deportment Mass % U

Ore

Thanksgiving Prospect

Minerals

AUS005 (TG):

AUS006 (TG):

AUS007 (TG):

AUS008 (TG): 0 20 40 60 80 100

Uraninite Coffinite BranneriteBrannerite-Silicates Intergrowths Uranophane-betaCalciouranoite Other U MineralsUranium-Silicates Intergrowths Uranium-FeOX Intergrowths REEFe Oxides Ti Oxides Carbonates Sulphides Apatite Quartz Feldspars Pyroxenes Amphiboles Sphene Chlorite MicasOther silicates Others

Mass (%)


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Table 10: Thanksgiving Prospect Mineral Abundance

Mass U (%) Samples

MineralsAUS005(TG):

AUS006(TG):

AUS007(TG):

AUS008(TG):

Uraninite 49.04 83.46 52.46 45.10Coffinite 4.39 2.97 15.60 13.78Brannerite 4.33 3.90 5.28 4.67Brannerite-Silicates Intergrowths 0.42 0.80 0.58 0.45Uranophane-beta 1.04 0.40 1.41 1.43Calciouranoite 2.29 0.38 2.50 1.82Other U Minerals 0.62 0.20 0.47 0.38Uranium-Silicates Intergrowths 36.54 7.63 20.96 31.04Uranium-FeOX Intergrowths 1.32 0.26 0.74 1.34TOTAL 100.00 100.00 100.00 100.00

Table 11: Thanksgiving Prospect, Elemental Deportment Mass % U

7.4 JORC Code Resource Estimate

During September 2009, Coffey Mining Pty Ltd (Coffey) were appointed by DYL as resource consultants for a number of prospects around the Mount Isa area including the Bambino, Thanksgiving and Eldorado North prospects at Isa West. As part of the process of producing a JORC compliant resource, Coffey carried out a comprehensive review of DYL’s field procedures during a visit to Mount Isa.

Ore


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From the data provided in Appendix 1 and using a 300 ppm U3O8 cut-off, Coffey calculated the Indicated and Inferred Mineral Resource estimate for the Thanksgiving, Bambino and Eldorado North Prospects totalling 2.33 million tonnes at 410 ppm U3O8 for 960 tonnes (2.1 Mlbs) of U3O8 (Table 12).

Table 12: Isa West Projects - January 2010 JORC Code Resource Estimate

The Thanksgiving and Bambino Prospects are currently open to depth and the Eldorado North Prospect has only been drilled to 60 metre vertical depth and is open to depth and to the south.


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7.5 Rehabilitation

Following the completion of the RC drill programme a comprehensive rehabilitation programme was carried out for both 2008 and 2009 drill sites. The objective of the programme was to remove all signs of drilling, except for the PVC collars and windrows, and leave the drill pads in a condition where the natural recovery of the vegetation can occur with time.

Prospect EPM No. of HolesRehabilitated

TURPENTINE 11524 16GOYA 12886 2BAMBINO 12886 53THANKSGIVING 12886 51ELDORADO NORTH 12886 12NEVER CAN TELL 12886 3NEVER CAN TELL UNDERCOVER 12886 9FOLDEROL NORTH 12886/13098 4FOLDEROL SOUTH 12886 6MIAMI 12886 3MIGHTY 12886 3FLAT TYRE 13098 4CITATION 12886 3CITATION UNDERCOVER 12886 8EMANCIPATION 12886 1

Table 13: Isa West Rehabilitation Summary by Prospect

The pads will be monitored to confirm the revegetation of the cleared areas. The cutting and burying of collars will occur when DYL is confident that access to the holes is no longer required.


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Plate 1 & 2 - View of Bambino Prospect and May Downs Road after Rehabilitation Work


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Plate 3 - Northern area of Thanksgiving Prospect after Rehabilitation Work.

7.6 Field XRF Survey

A field portable Niton XRF soil geochemistry survey was conducted at Goya and Frida prospects on EPM 12886 totalling 446 samples. Assay Data given in Appendix 3.

Soil cover was thin, probably less than 30cm, and often sub-crop. These surveys were to improve targeting / identify anomalies for potential grader costeaning. Detailed soil sampling over the prospects where taken at 10m-25m intervals with the highest value of 2101ppm, however most samples across this outcrop were above 350ppm copper.

The survey at Frida consisted of 355 sample locations across 14 east-west lines, including two 1m spaced transects of known, outcropping mineralisation. Four samples returned values>900ppm Cu and one with 11g/t gold. These are outliers however, with the average being~300ppm Cu. It would appear the mineralised dykes responsible to the higher assays do not have enough cumulative bulk to raise the soil copper content. Figure 1 below, shows the sporadic nature of the mineralisation. Both image use the same scale; Blue <150, green <250, yellow <400, red < 900 purple >900.

Follow up of an 11 g/t XRF gold anomaly was undertaken with three -2mm mesh soil samples, and panning of a concentrate for testing with the Niton. No gold was assayed by the XRF instrument. An old costean across a copper zone near old pits was cleaned with pick and shovel, and a 10m section of one wall sampled at 1m intervals. Whilst these are not hard rock samples, they should give an indication of


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the oxide copper content. The results were very disappointing with the highest assay being 0.03g/t Au.


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Figure 1: Frida Field XRF Copper Results.

At Goya ninety samples were taken. The survey traverses were a lot more selective at Goya then at Frida due to better outcrop throughout the area. The survey targetted areas of known mineralisation and the greatest concentration of pegmatite dykes based of previous mapping.

Some higher grade copper occurs at the eastern edge of the Goya Prospect (Figure 2) grid with out-crop of biotite schist / hornfels with minor malachite and soil sample assay of 2007ppm copper. Although Goya holds greater prospectivity then Frida, it is very hard to draw any correlation of mineralised zones between survey lines.


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Figure 2: Field Assay Results from the Goya Prospect

7.7 Reconnaissance Mapping

A brief mapping exercise was completed during December 2009 to investigate the spatial orientation of copper bearing dykes within the Frida Prospect area. Over a period of about 4 days, a small area (1.8km x 1km) was geologically mapped in an attempt to identify any structural control on the pegmatite dykes system within the region.

The pegmatitic dykes are loosely confined to thin (1-2m) bands, scattered within the gneissic fabric. Due to the highly deformed nature of the host gneiss, the subsurface orientation is still unclear; however the dip at surface is sub-vertical.

Despite hosting very good mineralisation locally, the potential for this area to contain an economic ore body was downgraded due to the lack dyke density.


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8 CONCLUSIONS AND RECOMMENDATIONS

Work conducted within the Isa West tenements during the year ending 11 May 2010 has further defined and extended a number of uranium prospects and resulted in the production of JORC Code Resource estimates for three prospects. The encouraging results from work conducted during the reporting period, supports the need for further exploration to ascertain the extent and economic potential of the uranium mineralisation.

Based on work conducted during the year ending May 2010, it is recommended that additional fieldwork including geological mapping, geophysical surveying and drilling is undertaken to further define uranium mineralisation and its structural settings at historic prospects.

Additional fieldwork should also be carried out in the northern areas of the Isa West package to target significant subsurface structures of the uranium bearing Eastern Creek Volcanics.


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9 REFERENCES

Connors KA and Page RW, 1995, Relationships between magmatism, metamorphism and deformation in the western Mount Isa Inlier, Australia, Precambrian Research, Vol 71.

Connors KA, Proffett JM, Lister GS, Scott RJ, Oliver NHS and Young DJ,1992, Geology of the Mount Novit Ranges, southwest of Mount Isa Mine, in Stewart AJ and Blake DH (Eds.) Detailed Studies of the Mount Isa Inlier, Australia Geological Survey Bulletin Vol 243, pp137-60.

Page RW and Bell TH, 1986, Isotopic and structural responses of granite to successive deformation and metamorphism, in Connors KA and Page RW, 1995 (Eds), Relationships between magmatism, metamorphism and deformation in the western Mount Isa Inlier, Australia, Precambrian Research, Vol 71.

Towsey CA, 1982, Assessment of Authority to Prospect 2264M Sybella, Memo Ref No CAT/5.1GEO 1.5, Isa Valley Compilation Memo.1983/033.

Harvey J, 2009, “Exploration Permits for Minerals Nos.12886 ‘Ding Dong’, 14657 ‘Mosses Bore’, 13098 ‘North Branch Creek’ and 11524 ‘Slaughteryard North’, Queensland Annual Report for the period ended 11 May 2009”, Queensland, Xstrata Copper Exploration Pty Ltd unpublished report.

DRAWINGS

APPENDIX

ONE to THREE

(Digital)

Appendix 1 Drill Hole DataAppendix 2 Raw Downhole Gamma Data App

endix 3 Assay and Soil Data

E E E E7,740,000 mN m m m m7,740,000 mN0 0 0 00 0 0 00 0 0 0, , , ,0 0 0 02 3 4 53 3 3 3

7,730,000 mN

7,730,000 mN

7,720,000 mN

7,720,000 mN

7,710,000 mN

7,710,000 mN

7,700,000 mN

7,700,000 mN

7,690,000 mN

7,690,000 mN

139º15' 139º20' 139º25' 139º30' 139º35' 139º40'

ML 8058 'ISA MINE'

139º15' (AGD66)1:1 Million Block ID Sheet : Cloncurry SF54

139º20'

139º25' 139º30'

5

139º35'

0 5

Kilometers

139º40'

10 15

Xstrata Copper Exploration Pty. Ltd.

-20º2-20º3

-20º3-20º4

-21- 21

º- 20

º35

- 20º3

0- 20

º25

ABN 53 009 681 118

Mount Isa

QLD

Drawing No. 61031Isa West General

Geology 100K AGSO - Sheet 6756

copper

1:250000 : SF54-1

1:100000 : 6756

Region : NWQ

Author :

Drawn : S. JefferyOffice : Mt Isa - Oban Road

Scale : 1:250,000

Date : 18/05/2007

Revised Date : 25/05/2010

Projection: AMG Zone 54 (AGD 84)

KEY

EPM Boundies

ML 8058Isa Mine

-20º4-20º5

-20º5- 20

º55

- 20º5

0- 20

º45

- 20º4

0

Sheet Size : A3

Drg No : 61031

Documents

s3-ap-southeast-2.amazonaws.com€¦ · Web viewTechnical Report 3762. Exploration Permits for Minerals Nos. 11524 ‘Slaughteryard. North’, 12886 ‘Ding. Dong’, 13098 ‘North