WOODLINE GOLD & BASEMETALS PROJECT

(Sipa 100% of 487 sq. km, 70% of 249 sq. km with Comet Resources Limited & may earn 70% of 30 sq. km held by Image Resources NL)

Woodline is situated in Archaean granites and greenstones and Proterozoic metamorphic rocks in Western Australia’s Southeastern Goldfields Region (see Figure below). We have been exploring for gold and basemetals here since 2005, initially in the belief that the Archaean rocks are capable of hosting major gold deposits, like the ‘Giant Golden Mile Deposits’. In late 2005, AngloGold Ashanti – Independence Group discovered the Tropicana Gold Deposits (now > 5 million ounces) in the Proterozoic Albany-Fraser Province metamorphic rocks, about 300 kilometres northeast of Woodline, thus adding a new dimension to the Project.

Woodline Gold Project on Landsat Image

Exploration by Sipa, and by Newmont Exploration Pty Ltd, who Farmed-into the property between late 2005 and late 2009, has included geological mapping, detailed airborne magnetic/radiometrics, ground gravity, selective airborne electromagnetics and ground Induced Polarisation and has:

•          taken 15,756 shallow geochemical samples

•          drilled 3,052 RAB/Aircore drillholes for 102,603 metres

•          drilled 77 RC holes for 8,981 metres

During the 2010/2011 year, and to time of writing, Sipa has:

•          taken 2,620 shallow geochemical samples

•          drilled 1,733 RAB/Aircore hole for 58,943 metres

•          drilled 61 RC holes for 6,771 metres

Many extensive gold-in-calcrete geochemical anomalies have been detected from the shallow geochemical sampling, in both the Archaean and Proterozoic rocks, as shown in the figure below. The most extensive of these are in the northeast trending metamorphic rocks and include Theofrastos, Heraclitus, Omaney and Cleanthes and possibly Leucippus. Archaean-hosted anomalies include Socrates and Adiemanthus.

Woodline - Gold in-Calcrete Image & Prospects

Exploration drilling by Sipa since the start of 2010/2011, and to time of writing this Report, is documented above. Also very importantly, relogging by Sipa’s Project Geologist of nearly all pre-existing RAB/Aircore holes, that had originally been logged by numerous Newmont and Sipa geologists, has given us a much better understanding of the geology, and potential for discovery, within the Project. Both RAB/Aircore and RC drilling by Sipa over the last 18 months has greatly enhanced the prospects of ‘discovery’ at Woodline. In particular:

Sipa released to the ASX on 15 August 2011 results of critical bottom-of-hole, one metre samples – in contiguous holes spaced 50 metres apart at Leucippus - and which may represent a ‘breakthrough at Woodline’, which were:

•          WDR1817     3.5 g/t Au, from 29 to 30 metres

•          WDR1816     1.0 g/t Au, from 26 to 27 metres

•          WDR1815     0.5 g/t Au, from 22 to 23 metres

The results were from vertical RAB drilling, and need to be understood in the context of more than 3,000 RAB holes drilled to date at Woodline.

The key results are from several holes at Leucippus, where:

•          one metre bottom-of-hole samples are of hard fresh rock (beneath soft weathered rock from which gold has been ‘depleted’) where the RAB drill cannot penetrate further, and

•          composite samples from the same drill holes of the soft weathered rock (but including the final metre) also contain anomalous gold.

The bottom-of-hole result of one metre @ 3.5 g/t Au is the ‘highest value’ ever recorded from 50 metre-spaced RAB drilling at Woodline. Furthermore, it is the first time that a ‘plus 0.1 g/t Au anomaly’ has extended across three consecutive 50 metre spaced holes, and the first time that consecutive ‘plus 0.1 g/t Au results’ have been recorded across two, 200-metre spaced lines, in an anomalous northwest-southeast trending zone at least two kilometres long as shown below.

Another way to look at the bottom-of-hole results in holes WDR1815 to 1817, is that they are the highest, second highest and fifth highest gold result out of thousands of 50 metre-spaced bottom-of-hole results. Interestingly, these outstanding results are ‘beside’ an auger gold-in-calcrete anomaly, rather than ‘directly coincident’ with it (see below).

In addition highly encouraging results have also been returned from Theofrastos, Heraclitus, Adiemanthus and Socrates.

More RAB/Aircore drilling at Leucippus and Adiemanthus is required, to extend and better-define these prospects prior to deeper RC drilling. More RC drilling is required at Theofrastos, Heraclitus and Socrates, as well as systematic reconnaissance RAB/Aircore drilling of numerous other gold-in-calcrete anomalies.