Agreement Summary | Technical Summary | Woodlands Complex | Copper Chert | Quartzite Well | Manganese Range

Jillawarra Joint Venture Agreement Summary

The Jillawarra Joint Venture Project comprises 4 granted exploration licences E52/1413, E52/1970, E52/1971 and E52/1972, and 12 granted prospecting licences P52/1285 to /1296 which cover more than 1,500 square kilometres. The tenements cover the Jillawarra sub-basin, a 65 kilometre long belt of sediments in which numerous copper and lead-zinc prospects have been identified. This belt is highly prospective for the discovery of shallow base metal mineralisation.

In the first half of 2008 the Company completed expenditure of $500,000, thereby earning a 51% interest in the Jillawarra Joint Venture.

Since 30 June 2008, the Company has completed additional expenditure in excess of $850,000, thereby increasing its interest to 70%.

Apex and the Syndicate each elected to convert their respective interest to a 10% interest free carried to completion of a bankable feasibility study and, accordingly, Abra’s interest in the Jillawarra Joint Venture rose to 80%.

In February 2010 AML purchased the Syndicates interest for $410,000 cash and consequently now owns 90% of the Jillawarra Joint Venture. 

After completion of a bankable feasibility study, Apex must elect to:

• contribute to future expenditure; or

• convert its respective interest to a 1.5% net smelter royalty. 

Jillawarra Joint Venture Technical Summary

The Jillawarra Joint Venture (JJV) covers the central and western portions of the Jillawarra Sub-basin plus extensive coverage of the Irregully Formation and its contact with the overlying Kiangi Creek Formation to the northwest of the sub-basin.

More than 20 prospects have been identified, the majority of which are the result of exploration during the 1970’s. Subsequent exploration prior to AML’s involvement within the Jillawarra Sub-basin, extending from the Woodlands Complex to the Abra deposit, has focussed entirely on extensions to known prospects. Within the area to the northwest, each of the known prospects was identified during the mid-1990’s as a consequence of airborne geophysical surveying and consequent follow-up exploration. Despite the large area, only four prospects within the northwest JJV area have received on-ground exploration.

Styles of base metal mineralisation encountered within in the JJV area thus far include chlorite-magnetite-copper-lead-barium alteration systems within dolomitic sandstone, lead-zinc mineralisation in fault brecciated carbonaceous shale units and fault related copper±gold mineralisation. In addition, manganese mineralisation occurs at Manganese Range and Woodlands.

Historic drilling produced intersections of 8m @ 21.5% Mn from 102m in WDDD005 at Woodlands Dome and 12m @ 18.8% Mn from 52m in MRRC004 at Manganese Range. The highest grade intersection was 2m @ 71% Mn from 94m in JRP-77-16 at Manganese Range.

The prospective horizons, which are more than 5km long at both Woodlands Dome and Manganese Range, have being identified and mapped, assisted by information from historic drilling and surface geochemistry

When considered in conjunction with mineralisation within the Mulgul Prospect, including the Abra deposit, the range of mineralisation associations and styles is regarded as further reinforcing AML’s belief that the region hosts a major long lived mineral system.

Woodlands Complex

The Woodlands Complex refers to a large regional coincident magnetic and gravity anomaly in the western portion of the Jillawarra Sub-basin. The feature hosts six prospects over an area of 6 kilometres east-west and 4 kilometres north-south. Prospects were selected primarily on the basis of magnetic sub-anomalies within the overall magnetic feature.

Drilling has identified significant mineralisation at three of the prospects, 46.40, Woodlands and Leader 18 (Table 2). At Thumbprint (TP), a 1,200 metre deep drillhole intersected magnetite alteration, brecciation and weak lead-barium mineralisation similar in character to that encountered at Woodlands and Leader 18.

Despite the significant low grade mineralisation encountered in direct association with magnetite, and hence magnetic anomalies, no electrical geophysical exploration or drilling has been completed between these prospects.

Copper Chert

Copper Chert is the only prospect where surface secondary mineralisation and pre-existing pitting are evident. Previous drilling of copper geochemical and electrical geophysical anomalies returned a best result of 0.6m @ 2.4% Cu (drillhole 75-8 from 124.5 metres).

AML completed six RC drillholes targeting an untested lead-copper anomaly (up to 1,050ppm copper and 940ppm lead) and associated geological and gravity targets. These drillholes intersected the best results to date from the prospect, including:

• CCRC003 intersected 14m averaging 1.1% Cu from 44 metres as secondary copper mineralisation in an intensely ferruginised fault zone.
  
• CCRC007 targeted a weak gravity anomaly and intersected 35m averaging 0.3% Cu from 165m associated with sulphides in quartz veined dolomitic sandstone.

Quartzite Well

A number of prospects occur within the central “bend” in the Quartzite Well Fault. Mineralisation intersected to date consists of anomalous lead-zinc mineralisation predominantly within tectonic breccias within the steep dipping fault zone. Drilling into the fault zone intersected a number of significant mineralised zones within siliceous and carbonaceous shale and breccia (Table 2).

Only a single drillhole, QDH-2, was targeted at the rocks north and underlying the Quartzite Well Fault, intersecting a few thin zones of weakly anomalous carbonaceous shale.

AML believes that the rocks to the north of the Quartzite Well Fault represent a significant target for stratiform lead-zinc-silver mineralisation.

Manganese Range

The Manganese Range prospect comprises a zone of folded Irregully Formation rocks in the hanging wall to the Quartzite Well thrust fault. Intense iron-manganese caprocks returned zones highly anomalous in lead (up to 4,000ppm) and 200m to the north, copper (up to 400ppm). Drilling conducted over several phases of work identified three styles of mineralisation:

• Lead anomalous mineralisation in strongly clay altered ± iron-manganese stained shales. The best result was 24 metres averaging 0.52% Pb from 8 metres in MR-89-5, including 4 metres averaging 1.3% Pb.
  
• Primary copper±gold mineralisation in fresh quartz-chlorite-magnetite altered rocks. This style of mineralisation returned a best intersection of 35 metres averaging 0.51% Cu from 313 metres in JLWA-77-27, including 9 metres averaging 1.03% Cu and an additional 2 metres averaging 2.09% Cu.
  
• A zone of relatively shallow (<88 metres) gold mineralisation in ironstone and ferruginous clays displaying anomalous gold (up to 0.44g/t Au).

AML believes that the occurrence of deep weathering with intense secondary manganese and iron concentration is indicative of a major alteration system that is yet to be fully understood. The alteration system is located within a favourable structural setting, above a major fault zone, and provides a significant focus for geological and geophysical targeting.

Table 2 Jillawarra Sub Basin Selected Drillhole Intercepts
Prospect	Hole ID	EOH (metres)	From (metres)	Intercept
46.40	77-28	308.5	110.0	41m @ 0.8% Pb, 0.2% Cu
46.40	78-34	365.0	185.0	6m @ 1% Cu incl. 1m @ 2.5% Cu, 5.5g/t Au
46.40	78-34	365.0	192.0	35m @ 0.4% Cu
46.40	78-34	365.0	243.0	23m @ 0.3% Cu
Woodlands	77-5	158.0	62.0	96m @ 0.1% Cu
Woodlands	81-5	410.0	372.0	38m @ 0.28% Cu, 5.56% Ba
Leader 18	L18-1	729.45		40m @ 0.39% Cu
Leader 18	WDH-1	650.0		60.5m @ 0.26% Cu incl. 0.4m @ 8.4% Cu
TP	81-8	1,200.0	594.0	4m @ 3.6% Pb, 12.96% Ba
TP	81-8	1,200.0	623.0	2m @ 4.66% Pb
Quartzite Well	75-3	189	98.0	2m @ 4.93% Zn, 1.58% Pb
Quartzite Well	75-7	2.9.9	115.0	346m @ 1.10% Zn, 2.00% Pb incl. 8m @ 2.42% Zn, 2.18% Pb
Quartzite Well	76-10	132.1	86	6m @ 5.90% Pb incl. 2m @ 10.3% Pb
Quartzite Well	76-13A	192.0	108	54m @ 0.28% Zn, 0.83% Pb
Quartzite Well	76-14	304.2	260.0	56m @ 0.53% Zn, 0.51% Pb incl. 1m @ 4.88% Zn, 1.89% Pb incl. 1m @ 7.38% Zn, 0.36% Pb
Quartzite Well	76-17	270.5	231.0	20m @ 0.16% Zn, 0.54% Pb incl. 6m @ 0.24% Zn, 1.28% Pb
Quartzite Well	77-8	158.0	114.0	32m @ 0.87% Zn, 0.45% Pb

Agreement Summary | Technical Summary | Woodlands Complex | Copper Chert | Quartzite Well | Manganese Range