MINING & EXPLORATION PROJECTS

Philippines

LINGIG (DAS-AGAN) PROJECT

The Lingig copper discovery is within the Das-Agan project which consists of MPSA application number 000024-XIII situated in Surigao del Sur province in east Mindanao as shown on Figure 1. The APSA covers approximately 80 km² (8,019 hectares) in two blocks. The Lingig copper discovery is contained within the eastern most tenement block on Figure 1. Permits for drilling were granted in June 2008.

The Lingig discovery was located by an aid programme between Filipino and Japanese geologists and technicians in 1972 to 1974 over eastern Mindanao. An initial 3000 km² prospective area was located by geological and geochemical surveys and was subjected to additional geological mapping and geochemistry, followed by drilling of five diamond drill holes, each to 250 metres vertical depth.

Geological Setting

The 17 March 2009 announcement reported copper mineralisation contained within an extensive east dipping 200 to 300 metre thick thrust zone. The thrust footwall is an un-mineralised medium-grained biotite-hornblende quartz diorite which intruded the basaltic sequence (numerous basalt xenoliths are present near the diorite contact in both core and in outcrop). The approximate intrusive contact subsequently became the footwall of a regional thrust zone. The 200 to 300 metre thick thrust zone is mineralised in some sections with disseminated and hairline veined chalcopyrite and minor bornite, with widespread epidote alteration, magnetite, pyrite, local shearing and carbonate veining. A 'quartz diorite sill' immediately above the thrust contact is mineralised with chalcopyrite as disseminations and veining and bornite, with common quartz veins up to two centimetre thick hosting centre-line pyrite, chalcopyrite, and bornite. The bornite and increased chalcopyrite content contributed to the higher copper assay grades. The 'quartz diorite sill' mineralisation is accompanied by magnetite disseminations and veining.

Figure 1 shows the locations of the Company's copper projects and Figure 2 shows the current interpretation of the regional geology with drill hole locations and a summary of results. Table 1 contains all drill hole results obtained to date. Figure 2 shows the detailed geology and drill hole locations and intersections around the Basalt prospect, and the projection of the Breccia prospect and intersections. Additional background information is contained in announcements dated 13 November 2007, 17 March 2008, 20 August 2008, 31 October 2008, 18 March 2009 and 9 October 2009 and the December 2007 quarterly report.

The 9 October 2009 announcement reported copper mineralisation contained within two settings, in basaltic host rocks and associated with a regional thrust zone (Zone 1) - now called the Basalt Prospect, and porphyry associated style mineralisation in dioritic rocks below the thrust zone (Zone 2), now called the Breccia Prospect.

Table 1 summarises all drilling completed since 2008.  View Table 1.

Drilling

Since the announcement on 6 October 2009, the Company has drilled approximately 6,204.5 meters in 15 angled holes using three rigs (LIN025 to LIN040). All holes were cored from surface. Drilling difficulties were experienced in LIN030 which was abandoned at a depth of 280 metres in strong copper mineralisation.
 

Basalt Prospect

The recent drilling has confirmed the continuation of the copper mineralised zone above the thrust contact (Figure 2), with the 'mineralisation now interpreted to form a large plunging body with a north-northeast trend. Hole LIN030 was drilled to test the down plunge continuation of the mineralisation and intersected epidote, magnetite, pyrite and copper sulphides in a basalt host, with similar geology, mineralisation and alteration to that intersected in hole LIN001. The hole was abandoned in mineralisation due to drilling difficulties. Assay results suggest that the hole was terminated above the expected high grade zone overlying the thrust contact. Hole LIN029 appears to have intersected the most up-plunge high grade mineralisation. Hole LIN022 was collared in the low grade halo of the plunging body, and drilled over the top. Hole LIN026 intersected basalt with halo mineralisation of strong epidote alteration with pyrite-minor chalcopyrite veining. The hole appears to have drilled under the plunging body. Hole LIN039 intersected basalt with halo mineralisation similar to LIN026, and appears to have drilled under and to the east of the plunging body.

Further drilling is required below LIN030 to confirm the down-plunge extensions and, if successful, to drill out the body.

In addition, it is interpreted that the zone discovered so far is only part of a larger mineralised body which has been truncated at depth by the underlying thrust fault. The Company is investigating methods which may assist in locating the rest of the mineralised body.

Breccia Prospect

This mineralisation is hosted by polylithic intrusive hydrothermal breccias. Variably sized clasts to 40 centimetres of quartz diorite, basalt and minor dolerite host disseminated fine-grained chalcopyrite in both the matrix and in some clasts. The chalcopyrite is associated with secondary pale brown biotite, which is noted in both the matrix and in some of the breccia clasts. A distinct lack of mineralised quartz veining and minor magnetite characterise the breccia. The breccia appears to be blind, has not been found reaching the surface, and is enveloped by a weak pyrite halo.

The breccia pinches out to the north. Intersections in LIN037 and LIN040 indicate that the breccia is open to the south. Figure 2 shows the projection of the breccia and the drill hole intersections.

QUARTZ DACITE PORPHYRY 

Interpretations suggest that the complex area to the south of the basalt and breccia prospects is a flow of dacitic composition underlain by flat-lying to low angle amygdaloidal basalt and basalt flows with flow breccias tops. The units have been strongly sheared with strongly developed wide spread zones of clay + pyrite +/- minor copper and lead sulphides + variable silica alteration. Surficial weathering processes have enriched gold in near surface zones as indicated by previously reported anomalous rock chip values. Three holes drilled into selected sites within the complex intersected only minor copper mineralisation (LIN 11, LIN 12 re-drilled as 13 and LIN 15).

Outcropping copper minerals with anomalous rock chip values to 1000 ppm copper occur in east-trending drainages immediately south of the Silver Belt Prospect indicate that the potential for the altered dacitic area to host copper mineralisation remains.


Work Programme

Data compilation and assessment, including induced polarisation and ground magnetics, will be undertaken prior to further drilling.