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Q502
NEWCREST MINING LIMITED
CHARTERS TOWERS PROJECT
Exploration Permit for Minerals 14642
FERN SPRINGS
Annual ReportOn work conducted in the 12 Month period
Ending 26 June, 2006
Compiled by Max A. LeBherz
July 2006
Distribution:
Newcrest Mining Ltd. - Brisbane (2)Department of Minerals & Energy (1)
Annual Report, Fern Springs EPM 14642 Period Ending 26/06/2006
SUMMARY
This is the first annual report for Fern Springs EPM 14642 which forms part of Newcrest Mining Limited’s Charters Towers Project. This report details exploration conducted on this tenement during the twelve months to 26/06/2006.
Exploration conducted during the current reporting period included data acquisition, compilation and interpretation. This work was aimed at identifying initial exploration targets for the 2006/2007 financial year. A review of Newcrest’s Environmental Management Plan for the Charters Towers operations was initiated to better address concerns regarding weed management.
Newcrest’s primary exploration target is a large tonnage economic gold deposit (in excess of two million ounces). Newcrest believes that the next major discovery in the Charters Towers district will be deeper than deposits previously discovered and will use its competitive advantage as an industry- leading, bulk-tonnage underground mining specialist to develop any suitable deposit. In North Queensland, deposits that fulfil Newcrest’s target criteria include Kidston, Mt. Morgan, Mt. Leyshon, and Ravenswood. Other targets include smaller tonnage, higher-grade deposits (such as epithermal Pajingo-style veins or mesothermal Charters Towers-style veins), which have the potential to exist within the Charters Towers Project area. These deposits are intrusive-related, and include brecciation, replacement, and stockwork vein styles of mineralization.
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Annual Report, Fern Springs EPM 14642 Period Ending 26/06/2006
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LIST OF CONTENTS
Page No.
1. INTRODUCTION & TENEMENT STATUS.................................................1
2. EXPLORATION RATIONALE.......................................................................1
3. GEOLOGY.........................................................................................................2
4. PREVIOUS WORK...........................................................................................3
5. WORK CONDUCTED......................................................................................4
6. NEWCREST EXPLORATION – FORWARD PROGRAM.........................6
7. REFERENCES...................................................................................................7
LIST OF FIGURES
Figure Title Scale
1. Fern Springs tenement location and sub-blocks 1:250,0002. Fern Springs interpreted basement geology and
drillhole locations 1:85,0003. Fern Springs regional aeromagnetic data and cover depth
contours. 1:100,000
Annual Report, Fern Springs EPM 14642 Period Ending
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1. INTRODUCTION & TENEMENT STATUS
This report is the first annual report for exploration conducted during the twelve months ending 26th June 2006 at Fern Springs (EPM 14642), which is part of Newcrest Mining Limited’s Charters Towers Project. Sub-blocks that make up the tenement are shown in Figure 1. No change to the current tenement position is being sought for this reporting period.
The Fern Springs tenement was granted on the 27th June 2005, for a period of three years, to expire on the 26th June 2008.
Fern Springs EPM 14642 is located WNW of Charters Towers, within the Lolworth- Ravenswood Block of Northeast Queensland. The tenement lies at the junction of four 1:100,000 geological map sheets; namely the Charters Towers (8157), Homestead (8057), Hillgrove (8058) and Dotswood (8158) Geological Sheets. These are contained within the Charters Towers (SF5502) and Townsville (SF5514) 1:250,000 Geological Sheets. Access to the tenement is via public roads and station tracks.
2. EXPLORATION RATIONALE
Newcrest Mining Limited’s primary exploration target is a +2 Moz gold deposit associated with Carboniferous-Permian intrusive related hydrothermal systems. Examples of such systems within northeast Queensland are:
Hydrothermal breccia and sheeted vein-style deposits such as Mt. Leyshon, Kidston and Mt. Wright.
Stockwork vein and lode style mineralisation at Nolans, Sarsfield and Buck Reef (Ravenswood).
There appears to be a strong northeast structural control on the localisation of Permo- Carboniferous intrusive systems. Studies of mineralised Permo-Carboniferous systems have identified several criteria which are considered important in area selection. These are:
NE-trending Permian-Carboniferous magmatic corridors Major geological contacts NE, NW, N-S and E-W structural trends Zinc-only anomalies indicate possible system at depth Zones of mafic intrusive activity Any of the above features within areas of cover with no/limited drilling Topographic anomalies Major gravity discontinuities
The Fern Springs EPM 14642 is considered prospective for a Permo-Carboniferous mineralized system, as it’s localized along a NE trending lineament known as the Keelbottom Corridor (Figure 2), which intercepts the EPM in the west. Such a system could exist beneath the Cainozoic cover units, within basement igneous lithologies.
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FIG. 1Date:20/5/2004
Author: CM
Drawn: EK
Newcrest Mining Limited
FERN SPRINGS
EPM 14642
Fern_Springs_EPMAppl.WOR
Scale: 1:250000 Projection: Longitude / Latitude (AGD 66)
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3. GEOLOGY
A brief description of the geology within and surrounding EPM 14642 follows, much of which has been summarised from Clark & Paine (1970) and Bain & Draper (1997). Descriptions of the broader regional geology for Newcrest’s Charters Towers project can be found in Dow (2006).
The Neoproterozoic to Cambrian Charters Towers Metamorphics exist as limited exposures to the east, and are considered similar to the Cape River, Argentine and Running River metamorphic packages which form basement to the batholithic rocks of the Charters Towers area. These are generally schists and gneisses of upper greenschist to lower amphibolite facies.
Ordovician to Devonian granitoids, of dominantly I-type, intrude and partition the metamorphic basement, and form the Ravenswood Batholith. Silurian-Devonian granitoids also make up part of the Ravenswood Batholith, and a significant part of the Lolworth Batholith to the west. These are both I- and S-type granites, of predominantly granite to granodiorite composition. The Fern Springs EPM 14642 lies approximately between the Ravenswood and Lolworth batholiths, and as such, is underlain by granitoids of both series.
A period of magmatism in the Late Carboniferous to Early Permian is represented by small igneous complexes (e.g. Tuckers and Boori Igneous Complexes), ring fracture controlled stocks and plugs, and high level plugs, vents and diatremes. A dominant northeast, and a lesser north-westerly control is evident in the emplacement of these magmas, and several corridors are defined by often-mineralised Permo-Carboniferous complexes (e.g. Mt Leyshon Corridor). The NE trending Keelbottom Corridor which intersects the Fern Springs EPM is therefore considered prospective for a mineralised Permo-Carboniferous intrusive complex.
Extensive Cainozoic cover overlies much of the area surrounding the Fern Springs tenement. This is comprised of fluviatile sediments and weathering surfaces (e.g. laterites, silicretes and ferricretes) of the Southern Cross and Campaspe Formations. Quaternary alluvial deposits also obscure basement in many areas.
Three main ages of mineralisation are evident in the Charters Towers region. The first is related to Volcanogenic Massive Sulphide (VMS) mineralisation in Cambrian to Ordovician sedimentary packages to the south of the Ravenswood Batholith – and as such is not relevant to the Fern Springs tenement.
A second phase of gold mineralisation associated with structurally controlled mesothermal veins occurs at numerous prospects within the district, the most notable being the Charters Towers veins. These veins have been variously age dated as late Silurian to early Devonian. Historical production from the vein system is approximately 7 Moz.
The third phase of significant gold mineralisation in the Lolworth-Ravenswood Block is associated with rhyolitic to dioritic igneous intrusives and extrusives of Permo- Carboniferous age. These include:
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i. Breccia-hosted gold at the Mt Leyshon, Mt Wright and Welcome Pipe mines and the Town Creek, Mt Canton and Plateau prospects.
ii. Stockwork vein and lode style mineralisation at Bucks Reef, Nolans and Sarsfield (Ravenswood area).
Permo-Carboniferous igneous activity falls on linear northeast-trending corridors; these have been well documented in literature as the Keelbottom, Mt Leyshon, Pajingo and Mt Robin trends. The strong northeast control probably represents crustal scale vertical transform faults, possibly related to the creation of the Drummond Basin by back arc extension.
Interpretation of aeromagnetics, mine visits and prospect maps indicate that on a deposit scale, a strong northwest trend or northeast trend is very important in localising the ore deposits at Mt Leyshon, Mt Wright to Nolans at Ravenswood, Scott Lode to Vera-Nancy at Pajingo and the structurally controlled veins at Charters Towers, i.e. it is the intersection points of these major northeast and northwest faults where large gold deposits preferentially develop. Similar structural orientations in different age deposits (Charters Towers versus Mt Leyshon-type) indicate activity of long-lived, reactivated structures.
4. PREVIOUS WORK
From 1969 to 1970, Comalco Ltd. undertook stream sediment sampling over A to P 604M, which covered the majority of the current EPM 14642. The sampling failed to identify areas of mineralisation.
During 1977-1979, BHP investigated aeromagnetic anomalies on A to P 1775M with little success. A to P 1775M included only a very small area in the east of the current permit area.
Exploration for detrital gold by Australian Anglo-American in 1980-1981 covered As to P 2492M and 2493M. These explorers found the Cainozoic sedimentary units unsuitable for hosting this style of deposit.
From 1981 to 1983, Metals Exploration focussed their efforts around the Big Hit Mine. Following a Joint Venture agreement with Seltrust, both the Big Hit and Newhaven areas were drilled, with the best intercepts being 2m @ 5.37g/t Au and 2m @ 4.30g/t Au respectively.
From 1983 to 1984, BHP explored the area for gold. Despite the identification of some minor occurrences, no economic mineralisation was defined.
From 1986 to 1990, WMC embarked on an extensive exploration campaign which included much of the current EPM holding. This work aimed at mapping the Cainozoic stratigraphy, locating and sampling known prospects, and mapping areas of exposed Palaeozoic basement. A low-level aeromagnetic survey over 300m line spacings
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identified eight anomalies, six of which were followed up with ground magnetic traverses to define the shape and tenor of the anomalies.
A total of 489 stream sediment samples were taken by WMC. The only anomaly generated from within the current EPM boundary was from drainage from the Big Hit Mine. Soil sampling traverses over the Newhaven and Big Hit areas were of minimal success in identifying new areas of anomalism.
The Big Hit prospect was also the location of a 50m dipole-dipole IP survey, which generated no anomalies. No drilling was conducted at that prospect, however, percussion drilling at the Newhaven prospect recorded a maximum intercept of 1m @ 18.3g/t Au. From 12 holes drilled along the Newhaven lode, results were generally disappointing, and did not warrant further investigation.
Mapping and soil sampling over the Powlathanga prospect led to the drilling of 59 percussion drillholes over this prospect. An intersection of 1m @ 1.23g/t Au was recorded, however, no other anomalous values were returned. Other prospects targeted by WMC fall outside the current tenement boundary.
A review of the WMC data by Mt Leyshon Gold Mines in 1992 encouraged further exploration over some of the prospects in the area. Mt Leyshon / Normandy Exploration retained the area until 1999 after completing further geophysical surveys, sampling programs, and an extensive grid based drilling program to test under cover for large open-pittable resources (e.g. Mt Leyshon). This drilling covers the entirety of the current EPM holding down to igneous basement, and is considered to be of most value to Newcrest’s exploration program. Some areas of minor anomalism were intercepted.
A review of past work has indicated that known outcropping prospects are of limited potential. Most areas of mineralisation are restricted to small areas, and as such are not prospective for bulk tonnage orebodies. In addition, poor results from past drilling have significantly downgraded most prospects.
The most prospective areas within the Fern Springs EPM are therefore considered to be areas of concealed basement within the projection of the Keelbottom Corridor.
5. WORK CONDUCTED
Work on the Fern Springs EPM 14642 for this reporting period involved:
Data compilation, review and interpretation. Familiarisation with the local geology and past work. A review of Newcrest’s Environmental Management Plan to ensure that access
to, and work within EPM 14642, is executed in a manner compliant with landowners and native title parties, and to prevent the spread of noxious weeds.
A review of surface geochemical data (soil, stream and rockchip) has identified some anomalism associated with known outcropping prospects and old workings. As noted
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by Chenoweth & Evans (1986), most prospects within the immediate area occur in exposed Palaeozoic lithologies where cover is thin or non-existent. Some of these prospects and workings include Newhaven, Big Hit Mine, Powlathanga, Brahman and Lashinki (Figure 2). Past workers indicate that these are of greisen or quartz vein-style mineralisation developed within granitoids (Chenoweth & Evans, 1986; Bush, 1990; Stallman, 1999). While past exploration has shown that many of these prospects are small occurrences, areas of igneous basement under cover within the tenement are considered prospective for concealed mineralisation – in particular where the interpreted Keelbottom Corridor projects through the EPM in the northwest (Figure 2). This is due to the localisation of mineralised Permo-Carboniferous systems within NE trending corridors observed elsewhere within this region.
Interpretation of the main basement lithologies from surface geology, aeromagnetic, and gravity data show that it consists of granitic rocks ranging in age from Ordovician to Silurian-Devonian. A domain boundary is interpreted to divide the Siluro-Devonian rocks (of Lolworth Batholith affinity) from older plutons (of the Ravenswood Batholith; Figure 2).
Initial interrogation of drillhole assay data to identify areas of low level geochemical anomalism at the basement-cover interface has focussed on the western areas of the tenement where the Keelbottom Corridor is interpreted to project through the tenement. Most sampling of drillholes in the area was done as 3 to 5m composites, and as such is not ideal for detailed evaluation. However, this work has identified minor anomalism coincident with the basement-cover contact in some areas. Gold values are typically below detection in most areas, however, are noted to increase marginally in the far west of the tenement (up to 0.11g/t Au, mostly ~3ppb Au). Copper values increase locally from background levels (<10ppm) to over 100ppm, and zinc is noted to cluster above 50ppm, and occasionally >200ppm. The best gold grades occur within the projected trend of the Keelbottom Corridor. Copper is also elevated in this area, as well as a cluster of anomalous values to the east of the corridor. While this work has demonstrated minor anomalism in this area, it has largely failed to define discreet drill targets.
A large amount of time has been spent on a review of Newcrest’s Environmental Management Plan (EMP) for the Charters Towers Project. In particular, this review is focussed on issues regarding the threat of noxious weeds such as Parthenium. Recent weather conditions in this region have promoted weed growth and spread, and have highlighted the need for control of pest species. Upon completion, the revised EMP will aim to:
meet all statutory obligations (including the draft Weed Spread Prevention Strategy),
address landowner concerns about weed introduction and spread, and provide Newcrest with a practical procedure to manage weed spread.
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6. NEWCREST EXPLORATION – FORWARD PROGRAM
Work during the upcoming year will focus initially on the completion of the Charters Towers Environmental Management Plan review. Once completed, access will allow field investigations. In particular, field visits to all known prospects, as well as reconnaissance mapping to confirm the extent of cover, will be a priority.
Newcrest’s main exploration efforts within the Fern Springs EPM in the coming year will aim to:
Complete a detailed review of available aeromagnetic, gravity, and drilling data for the purpose of target generation.
Drill test priority targets generated from the above work. Efforts are expected to be focussed on concealed basement in the central and western areas of the tenement.
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7. REFERENCES
Box, S., 1993, Annual Report for 1992/1993 Twelve Months ending 30th April and Final Report EPM 8759 Hahn Creek, Mt Leyshon Gold Mines Ltd, v 1. CRCR24531A
Box, S., 1994, Annual Report for EPM 9251 Towers, Twelve Months ended 11th
March 1994 Final Report EPM 8123 Lincoln Hill & EPM 7497 Southern Cross Puzzler, Mt Leyshon Gold Mines Ltd, v 1. CR26257A
Bush, A., 1990, Final Report for As.T.P. 4202M Gains Creek, 4203M Percy Springs, 4332M Barkla, and Partial Relinquishment Report for 4421M Southern Cross, Western Mining Corporation, v 1. CR21915A
Chenoweth, L.M., Evans, D.F., 1986, First Six Months Report on Exploration of A to Ps 4202M (Gains Ck), 4203M (Percy Springs), 4332M (Barkla) and 4421M (Southern Cross) to 5th August 1986, Western Mining Corporation. CR16249A
Stallman, M.N., 1999, EPMs 9251, 9693, 10150, 10380 and 11162 Combined Annual and Final Report on Exploration Activities for the Period July 1993 to June 1999, Normandy Exploration Ltd, v 1. CR31477A
Bain, J.H.C., Draper, J.J., 1997, North Queensland Geology, Australian Geological Survey Organisation Bulletin 240, and Queensland Department of Mines and Energy Queensland Geology 9, 600p.
Clarke, D.E., Paine, A.G.L., 1970, 1:250000 Charters Towers Geological Sheet – Explanatory Notes, Hon. R.H. Swartz (Ed.), Bureau of Mineral Resources/Geological Survey of Queensland.
Dielemans, P., 1999, Second Combined Annual Report on Work Conducted in the 12 Months ending 23 May 1999 for Exploration Permits for Minerals 10937, 11047,11010 and 11069. Newcrest Mining Ltd.
Dielemans, P., 2000a, Combined Partial Relinquishment Report on Sub-blocks Relinquished 4 May 2000 from EPM's 10937, 11047 and 11010. Newcrest Mining Ltd.
Dielemans, P., 2000b, Third Combined Annual Report on Work Conducted in the 12 Months ending 23 May 2000 for Exploration Permits for Minerals 10937, 11047,11010 and 11069. Newcrest Mining Ltd.
Dielemans, P., 2001, Fourth Combined Annual Report on Work Conducted in the 12 Months ending 23 May 2000 for Exploration Permits for Minerals 10937, 11047,11010 and 11069. Newcrest Mining Ltd.
Dielemans, P., 2002, Fifth Combined Annual Report on Work Conducted in the 12 Months ending 23 May 2000 for Exploration Permits for Minerals 10937, 11047, and 11010. Newcrest Mining Ltd.
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Dow, R.J.D., 2006, Annual Report on Work Conducted in the 12 Months ending 26 March 2006 for Exploration Permits for Minerals 10937, 12124, 14591, 14594,14595, 14596 and 14597, Newcrest Mining Ltd.
Rayner, J.G., 1997, EPM 10937 Mt Deane, Annual Report for the Twelve Months Ending 31 January, 1997, Newcrest Mining Ltd.
Taube, R., 1998. First Combined Annual Report on Work Conducted in the 12 Months ending 23 May 1998 for Exploration Permits for Minerals 10937, 11047, 11069 and 11010. Newcrest Mining Ltd.