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29 January 2013
ASX ANNOUNCEMENT
ACTIVITIES REPORT FOR THE
QUARTER ENDED 31 DECEMBER 2012
HIGHLIGHTS
•
Frome Embayment East (NSW- Broken Hill West) expression of interest lodged seeking Ministerial approval
under the Act, to explore for Group 11 (U and Th) minerals.
•
Caldera Project (QLD - Georgetown) negotiations being held to fund a deep Induced Polarisation (IP) survey
via a joint venture.
•
Weipa Project (QLD Cape York) sale by transfer of the tenements will now be completed consequent to the
granting of tenements.
Registered Office
Level 17, 530 Collins Street
Melbourne VIC 3000
T: +61 3 9618 2590
F: +61 3 9620 5200
E: [email protected]
Callabonna Resources Limited - ABN 71 099 247 408
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CALLABONNA RESOURCES LIMITED
QUARTERLY REPORT
FROME EMBAYMENT EAST (NSW –Broken Hill West) 100% CUU
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In November 2012 the Company lodged an expression of interest requesting Ministerial consent under the Act for
Group 11 (U &Th) exploration rights over EL7684. The Company has also lodged an application to renew EL7684.
Background on Frome Embayment East
EL7684 (100% CUU)
Callabonna Resources is actively exploring the Eastern Frome Embayment in NSW 80 km north and west of Broken
Hill near the margin of the Callabonna Sub-basin. This area has potential for a wide range of metals including uranium
that may be associated with REDOX systems in the subsurface; the metals being sourced from the well mineralised
Precambrian rocks exposed in the Barrier Ranges.
View of the eastern edge of the Callabonna sub-basin (Mundi Mundi plain) faulted against the Barrier Ranges north-west
of Broken Hill
The Project (EL 7684“Gum Park”) occurs south of outcropping source rocks anomalous in gold silver uranium and
base metals. These outcrops are also defined by a radiometric anomaly. On 24 January 2012 Silver City Minerals
entered into a JV on EL 7684 Gum Park, north-west of Broken Hill. Following a review of its corporate strategy, on 2
July 2012 Silver City withdrew from the JV after meeting the minimum expenditure requirement. During that period
access agreements were signed with landowners and preparation was made to carry out drilling. Callabonna has reestablished itself as the operator, signed new access agreements and is considering options for the exploration
program.
Legislation proclaimed on 13th September 2012 has afforded the Company an opportunity to seek the Ministers
consent under the Act for Group 11 (U & Th) exploration rights in addition to the Group 1 rights (all other metals)
currently held. Group 11 rights would allow exploration for (but not mining of) uranium.
These additional rights would reasonably be required to provide commercial security to existing programs where
Group 1 and Group 11 metals are likely to occur together in a mineral system. Because uranium is a polyvalent
transition metal it often occurs in mineral system with other metals; typically gold, silver, copper, vanadium and
molybdenum.
CALDERA PROJECT (QLD Georgetown) 100% CUU
The Caldera Project consists of six highly prospective tenements for uranium, gold and copper all located within 20 km
of Georgetown in far north Queensland.
EPM18625
EPM18028
EPM10827
EPM18898
EPM18700
EPM18752
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During the quarter advanced negotiations were held with a party to fund an Induced Polarization (IP) survey.
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Background on Caldera Project
The Company believes that a deep Induced Polarization surveying (IP) will be the key to successful exploration of
these tenements, by efficiently developing drill targets over target structures in all three caldera centres.
Location map of the six tenements that make up the "Caldera Project" of three volcanic centres. Also shown are the
target structures interpreted from recent magnetic surveys that form direct targets for IP surveys
In the September 2012 quarter the Company made a submission to the DNRM to include all six tenements in a single
project for reporting and expenditure purposes, and discussions were held with contractors to scope and quote a
geophysical program.
Callabonna's Caldera Project comprises three volcanic centres, Dismal Creek, Dagworth/Neptune and Maureen, all
located within 30km of Georgetown in far north Queensland. A caldera is a centre of volcanic eruption associated with
faulting, subsidence, breccia, sub volcanic intrusions hydrothermal fluids and metals. This project has potential for Cu
porphyry, epithermal Au and large volcanogenic uranium deposits. It is an excellent Greenfields project targeting well
defined structures with IP.
The primary concept is that previous exploration in the Project area has neglected to explore the central zones of
these calderas at depth, even where structure was evident it was perceived as too difficult; in favour of shallow
relatively easy targets at the margin of calderas.
The Caldera project forms part of a well recognised ca 300 Ma large felsic igneous province in North Queensland that
has a pedigree for gold and copper as well as volcanogenic uranium deposits. Significant mines in this belt include
Kidston (gold), Red Dome (copper) and Maureen and Ben Lomond (uranium).
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Location of the Company's exploration permits (green) in the regional geology context (intrusions red, volcanic orange).
Situated in one of the most productive mineral belt in QLD, the Upper Carboniferous - Lower Permian (~ 300Ma)
Townsville – Mornington igneous belt
In the Caldera Exploration model, fluid flow and fluid mixing produces epithermal Au and Ag (and uranium) deposits.
Mineralisation is enhanced in more permeable structural zones and the lower permeable strata. Post caldera stocks
(porphyry copper targets) may localise along deeper structures covered by later eruptions.
A more detailed description of the Exploration model and this project can be found on the Company’s web site.
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Dismal Creek Caldera (EPM 18700 and 18752 - 100% CUU)
The Dismal Creek Caldera is located 28 km to the west-northwest of Georgetown and mostly lies within EPM 18752.
The area has potential for porphyry copper and breccia style epithermal gold, as well as uranium. A target area has
been interpreted based on the assumption that a number of satellite epithermal deposits may be related to a large
central porphyry system still covered by coeval volcanic deposits.
Geology and “Target circle” - interpreted porphyry centre still covered by volcanic deposits. Copper contours are shown
(red lines previous MMI survey) and alteration and breccias locations (black stars)
Dagworth / Neptune Caldera (EPM18028-18652 - 100% CUU)
The Neptune - Dagworth Caldera is located 30 km northeast of Georgetown and mostly lies within EPM 18028. The
Dagworth uranium prospect straddles the boundary between EPM 18028 and 18625.
The Target corridor is defined by Callabonna’s geologist from magnetic data interpretation and geochemistry.
Extensive stream sampling by Carpentaria Exploration Company (CEC) in 1987 (CR 18668) located a large goldarsenic anomaly that led to the discovery of the Cornucopia prospect. So there are both uranium and gold systems
present in the Target corridor.
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CALLABONNA RESOURCES LIMITED
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Historic stream sampling found distinct gold and arsenic anomalies in the Target corridor, overlaid on geology
Drilling had previously been undertaken at the Dagworth uranium prospect (by Minatome in the 1970’s, later Pechiney)
and the Cornucopia gold prospect (by CEC the exploration arm of Mt Isa Mines in 1988). Of the 89 holes drilled at
Dagworth 50% contained intervals greater that 300ppm uranium. At Cornucopia 30 holes were drilled intersecting
epithermal gold bearing veins that outcrop over an area of 1000 by 1400 meters. Drill intervals included grades in the
range of 0.5g/t to 4 g/t gold over widths of 2 to 6 metres (CR 196998). The veins are classic epithermal quartz with
carbonate replacement textures that indicate fluid boiling.
Significantly all the holes at Cornucopia only tested the upper 30-50 meters of the upper ignimbrite unit. None were
deep enough to intersect the underlying breccia or rhyolite units, an obvious target. Callabonna’s geologists have since
identified another larger breccia unit 1000m to the west that also has gold associated.
Maureen Caldera (EPM18027 and 18898 - 100% CUU)
The Maureen Caldera is located 30 km northwest of Georgetown and mostly lies within EPM 18898.
The Maureen Caldera area has potential for very large volcanogenic U-F-Mo (Russian Streltsovskoye Style) and
epithermal gold associated with a major caldera scale fault imaged clearly in the magnetic data. The Target fault is
reflected in the geology by forming a boundary between two rhyolite units (Womblealla and Puranga).
An IP survey over this fault would be decisive. Over 50% of the Target fault zone is covered by about 20m of Tertiary
kaolin grit.
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CALLABONNA RESOURCES LIMITED
QUARTERLY REPORT
Target Structure defined by magnetic with geology and mineral prospects overlaid
GEORGETOWN GOLD PROJECT (QLD) 100% CUU
This project includes two tenements EPM18181 (Delaney) and EPMA18699 (Central) situated in the Georgetown
Goldfield. Both tenements contain old gold workings and, at Delaney, some significant historic drill intersections as
well.
No work was completed during the quarter. The Company has had several expressions of interest to purchase these
areas.
ARUNTA PROJECT (NT) 100% CUU
During the quarter Mt Dennison EL27181 was surrendered in the absence of any a joint venture interest.
Up to 100ppm uranium had been found to occur in granite near the surface over wide areas as defined by
geochemical surveys. The Company had been seeking either a sale or joint venture for this asset.
WEIPA BAUXITE PROJECT (QLD Cape York) - subject to a Sale and Purchase agreement with McKay Brooke
Resources Pty Ltd
The board is pleased to announce that the long awaited granting of EPM17843 and 17835 has been achieved. This
will allow finalisation of the Sale and Purchase Agreement with McKay Brooke Resources, and; subject to the transfer
of those tenements the Company will receive the final $100,000 payment.
The back ground to this transaction is that in 2011 the Company moved to divest the Weipa - Cape York Bauxite
project involving three Tenements, EPM 17836 and two EPMA’s 17835 & 17843. Consequently a sale and purchase
agreement was signed with McKay Brooke Resources Pty Ltd, $50,000 was paid and EPM 17836 was transferred to
McKay Brooke. Another $100,000 remains to be paid when at least EPM 17843 is transferred, and that requires the
granting of 17843.
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QUARTERLY REPORT
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CORPORATE
During the quarter the Company has raised capital from the issue of shares and continued to evaluate new
opportunities.
The Company broadened its exploration focus from uranium to a broader range of mineral consistent with the name
change from Callabonna Uranium to Callabonna Resources, announced in the September 2012 Quarter.
It has completed divestment of all underperforming exploration assets, so it may focus adequate resources on the
Frome Embayment East project in NSW. The Caldera Project in QLD is a high quality green-fields project and the
Company is involved in due diligence and discussion with a potential joint partner to fund the necessary exploration
work.
The cash at bank at 30th September 2012 was $184,000. A capital raising will occur in the next month to fund
continuing operations and evaluation of new opportunities.
TENEMENT UPDATE
Mt Dennison EL27181 has been surrendered (Arunta Project)
*EPM 17835 Weipa East 2 was granted (Cape York Project)
*EPM17843 Weipa East 1 was granted (Cape York Project)
*EPM 17836 was transferred to McKay Brooke Resources (Cape York Project)
* Note these tenements are subject to a sale and purchase agreement to McKay Brooke Pty Ltd
For further information, contact:
Michael Raetz +61 3 9618 2590
Ian Hobson +61 8 9388 8290
The information in this report that relates to Exploration Results is based on information compiled by Michael Raetz, a
Director of the Company. Mr Raetz has sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is undertaking. This qualifies Mr Raetz as a Competent
Person as defined in the 2004 edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves’. Mr Raetz consents to the inclusion in the report of the matters based on his information
in the form and context in which it appears.
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