Leonora East Project

M 37/635, 718, 1142 & P 37/6363, 6366-6369, 6397-6400, 6421-6422, 6451, 6455-6456, 6506-6515, 6674 (Birimian Gold 100%)

Introduction

The Leonora East Project represents significant opportunity for Birimian Gold, with strong potential for both gold and base metal mineralisation. The project is composed of three ungranted mining leases, namely M 37/635, 718, 1142, twenty five granted prospecting licenses, namely P 37/6363, 6366-6369, 6397-6400, 6421-6422, 6451, 6455-6456 & 6506-6515, and one ungranted prospecting license, P 37/6674. The tenements cover 5094 hectares in area and seventeen kilometres of strike within the highly prospective Keith-Kilkenny Tectonic Zone (see Figure B).

Exploration to date has included both drilling and surface geochemistry, however the effectiveness of this exploration has been assessed and requires further evaluation.

Location & Access

The Leonora East Project is located 640 kilometres to the northeast of Perth in Western Australia. The project lies 18 kilometres to the northeast of Leonora and is accessed from the north via the Leonora-Mertondale road, or from the south via the Leonora-Laverton road. Internally the project is accessed via pastoral station tracks and old mining tracks.

Previous Exploration

The tenements encompass 3 historical mining centres dating back to the early 1900s when high-grade gold mineralisation was mined from the quartz reefs within the project area. These 3 mining centres were located in the central project area at 'Harriston' and to the north at 'Flying Pig' and 'Chance' (see Figure 3.1).

The project areas were initially explored for nickel and copper-zinc mineralisation in the 1970s. Mineral Search & Development PL explored the southern tenement area for nickel between 1970 and 1973, and undertook a small programme of rock chipping, targeting ultramafic stratigraphy, with a best result of 0.3% nickel; this exploration has yet to be followed up.

A small area to the south of the 'Flying Pig' mining centre was explored by Hull Mining Australia for nickel between 1972 and 1973, however there were no results reported.

Esso Australia Ltd then explored the northwestern project area for copper & zinc between 1976 and 1977. Work included geological mapping and a limited programme of rock chipping. The results of this sampling were not published.

The next major phase of exploration began in the 1980s when a syndicate of prospectors explored the area on the northwestern boundary of P 37/6455, between 1987 and 1989. Their work programme included soil sampling, with results up to 48 ppb Au and was followed up by a programme of seven RAB drill holes. This drilling intersected a sequence of sheared volcanoclastic sediments, with assays of up to 0.091 ppm Au.

Kulim Ltd explored the area surrounding the 'Flying Pig' mining centre for gold between 1985 and 1988. Exploration included geological mapping, an EM survey, rock chipping (which yielded results of up to 16.5 gpt Au from an old mullock dump) and an eight hole RAB drilling programme. This drilling yielded encouraging results, including 2m@ 1.59 gpt Au and 2m @ 1.65 gpt Au. This work is difficult to accurately locate on the ground and has yet to be followed up.

Hann Gold Mining Ltd explored the area surrounding the 'Flying Pig' mining centre in 1983 and 1984. Rock chipping of the mullock dumps at Ada Crossley, Flying Pig, and Lady Croft yielded a number of anomalous results, including 2.67 gpt Au & 5.33 gpt Au.

Recent exploration of the Leonora East area began in the early 1990s. Geopeko explored its Butcher Well project for gold between 1992 and 1993; this project area partially covered the eastern side of the Leonora East project. Exploration included rock chipping, soil sampling and RAB drilling. Soil sampling highlighted several areas of anomalism, which were subsequently drill tested at a maximum 400 x 100 metre centres. This drilling yielded results of up to 4m @ 0.25 ppm Au.

Jubilee Gold Mines NL and Normandy Exploration Ltd explored the eastern side of the project area between 1993 and 1997. Their exploration included geological mapping, aeromagnetic surveys, soil sampling and both RAB/RC drilling. Soil sampling partially covers the western project area but was only weakly anomalous, which may be due to the colluvial and alluvial cover through the project area; little of the drilling was undertaken within the Birimian Gold project area. RGC Exploration and its successor, Goldfield's Exploration Ltd, explored the project area between 1993 and 1997. The work programme undertaken included geological mapping, aeromagnetic surveys, RAB and RC drilling. Goldfields recognized that the thickness of colluvial and alluvial cover through the project area would render surface geochemistry ineffective. Goldfields undertook an extensive programme of shallow RAB drilling on 800 x 160 metre centres, which served as a geochemical tool to 'see through' the cover to detect underlying mineralisation. The drilling was infilled where anomalous results were found. This gives the appearance of an extensive programme of drilling, however most of the holes failed to test bedrock and are therefore deemed to be largely ineffective (see Figure 3.2).

The drilling generated two main prospects within the northern project area, namely Evangelista and Evangelista North. Results in both the RAB drilling and follow up RC drilling, have yet to be followed up but have included 4m @ 1.54 gpt Au & 2m @ 2.22 gpt Au.

Geological Setting

Regional Geology

The Leonora East project lies to the east of Leonora in the Northeastern Goldfields of Western Australia and sits on the boundary of the Minerie & Leonora 1:100 000 GSWA Map Sheets.

The tenements cover 17 kilometres of strike within the Pig Well Graben, which is part of the highly prospective Keith-Kilkenny Tectonic Zone. The Pig Well Graben is a northwesterly striking, fault bounded structure, on the margin of the Murrin Murrin greenstone terrain and is interpreted to contain a sequence of Archaean sequence of felsic to intermediate volcanics and volcanoclastic sediments.

Prospect Geology

The tenements are partially covered by a veneer of Recent transported alluvium/colluvium, while the underlying stratigraphy is interpreted to be Archaean volcanoclastic sediments, which vary from siltstone to conglomeratic in nature, and belong to the Pig Well Graben sequence.

Exploration drilling to date has predominantly intersected a sequence of volcanogenic sediments, including siltstones, sandstones and conglomerates.

Mineralisation & Resource Potential

The Leonora East tenements show strong potential for both gold and base metal mineralisation. Historically the region has been mined & explored for gold, with a high degree of activity around the turn of the last century. In particular there are five historical mining centers either within the project area or adjacent to it; the Chance, Flying Pig and Harriston mining centres lie within the project area. These mining centers exploited high-grade gold mineralisation, with values of up to 108 gpt Au, and are hosted by quartz veining within the volcanoclastic sediment package.

The three historical mining areas within the project area are as follows (see Figure 3.1):

• Harriston
  The 'Harriston' mining center is located in the northwestern project area and consists of six small mines including Starlight and Harriston. These mines were operated between 1903-1919, with the exception of Golden Rabbit, which was mined in 1981 for a modest return. The total production from this mining center was approximately 4521 oz Au.
• Chance
  The 'Chance' mining center is located in the northeastern project area and was operated between 1904–1905, while the nearby 'Grays' prospect produced a small amount of gold in 1981. The total production from these two mines was only in the order of 42 oz Au.
• Flying Pig
  The 'Flying Pig' mining center is located in the northwestern project area and consists of eight small mines including Deerah, Flying Pig & Gwalia Bach. These mines were operated between 1898–1909 and produced approximately 893 oz Au.

The Gambier Lass and Artful Dodger mining centers are located external to the project area and are therefore not discussed as part of this prospectus.

Drilling to date has served as an excellent exploration tool to delineate mineralisation, however much of the drilling is deemed ineffective and needs to be further evaluated. It should be noted that whenever drilling has been extended to bedrock, in areas of mild anomalism, significant results have been generated (as is observed at the Evangelista prospects). This indicates that there is most likely a depletion zone within the saprolite that needs to be penetrated to achieve any meaningful geochemical results. There are also base metal assays that were generated during the gold exploration that require further evaluation in order to assist in the generation of drill targets for Volcanogenic Massive Sulphide (VMS) style mineralisation.

The Pig Well Graben shows similarities to the geological environment of Teutonic Bore (VMS) copper-zinc-silver deposits, which are currently being successfully explored by Jabiru Metals Ltd (formerly Pilbara Mines Ltd). There has only been limited exploration to date for these VMS deposits within the project area, namely by Esso Australia, and represent an excellent opportunity for Birimian Gold.