Region:		Western Australia
Commodity:		Au
Project Name & Location:		Salmon Gums
Target Deposit Type & Model:		>1 million ounce intrusion related gold
Land Status:		9 Exploration Licences
Ownership:		AusMF 100% Gold Rights, 50% all other minerals. (Part of the Tropicana Alliance Agreement with between Teck-Cominco and Australian Mineral Fields)

In January 2008, Australian Mineral Fields successfully completed the grant process for nine exploration licenses along the southern margin of the Fraser Ranges, about 100 km south of Norseman and 500 km southwest of AngloGold Ashanti / Independence Group's Joint Venture Tropicana Discovery (See Figure 1). The tenements are also approximately 300km southwest from AngloGold Ashanti / Independence Group's recently announced "New Gold Discovery" at the Beachcomber 1 Prospect, where 1km x 200m spaced AC drilling intersected 3m @ 65.8g/t from 25m (see Idependence Group NL Quarterly report Dec-2006 at www.igo.com.au). The Salmon Gums tenements are subject to the Tropicana Alliance Agreement with Teck-Cominco Australia Ltd.

Figure 1: Location plan for Salmon Gum tenements over combined gravity (colour) and magnetics (texture) image.

Conceptual Target Play for Tropicana Style Mineralization

The Company considers its Salmon Gums Project to be a conceptual target play, as was Tropicana, and will be exploring for a similar style of mineralization. Drilling at Tropicana intersected gold mineralization associated with intense pyritic and sericitic hydrothermal alteration cross-cutting a package of metamorphic rocks. (See Tropicana JV Update 18-Aug-2005 at www.igo.com.au.) The AngloGold Ashanti / Independence Group JV are likewise targeting a multi-million ounce gold deposit and announced an Australasian Joint Ore Reserves Committee (JORC)-compliant resource in December 2007 of 4.05Moz Au (62.8Mt @ 2.01g/t Au at a 0.6g/t Au cut-off). (See Independence Group NL news release 3-Dec-2007 at www.igo.com.au.)

Work Completed

Searches of WAMEX (West Australia Government Open File Database) suggest that relatively little exploration for gold has been conducted historically in the project area.

In 1995 and 1996 BHP Minerals Pty Ltd (BHP) held ground in the central southern portion of the Salmon Gums Project area, and conducted soil sampling, an aeromagnetic survey, minor stream sediment sampling and 5.7km of ground magnetic traverses, as well as limited, wide spaced Air Core (AC) drilling (McLatchie 1995,1996).   Soil sampling was generally at 1km spacing along gazetted roads covering most of the BHP project area.   In general the gold values were low, with a peak value of 6.4ppb Au.   34 AC holes were drilled in 1995/1996 for a total of 838.5m.   Drill spacing was at a minimum of 1km.   Lack of gold anomalism in the Air Core drilling led BHP to drop the tenure, although moderately elevated levels of silver, zinc and copper were noted in the BHP reports.

Since application of tenure the Company has completed an initial approximately 10km x 1km spaced geochemical program along gazetted roads under Miner's Right. This defined several areas of gold in soil anomalism. In February 2008 he Company compeleted an infill soil geochemical program to provide more definition to the previously defined areas of anomalism (summarised in Figure 2).  These results have confirmed the anomalism defined within the central area and defined coherent areas of strong anomalism within the central area. Figure 3 shows how the original large anomaly has been broken into smaller zones within a regionally elevated background. Of particular note is the area of anomalism at the north and open to the north and west. This defines a coherent anomaly, coincidental with the GSWA interpreted location of the Jerdacuttup fault which is approximately 10km long by 2-3km wide. The area not imaged occurs within a proposed national park, an area for which the Company has just received permission to carry out extra soil geochemical sampling, a program that is planned to occur in July 2008.

Figure 2: Geological interpretation of the Salmon Gums area with a summary of the targets generated from Australian Mineral Fields' soil geochemical sampling.

Figure 3: Raw gold values from the infill soil sampling on a background of a gridded image of percentile values levelled by sample type¹

Figure 4: Snapshot of the main area of defined anomalism (gridded image of percentile values levelled by sample type¹) at Salmon Gums showing peak anomalism from each of the discrete anomalies better defined by infill soil geochemistry. White lines indicate gazetted roads.

PROJECT BORDERS ANGLOGOLD ASHANTI'S HOLDINGS

The Company's Applications abut the southwestern edge of Anglogold-Ashanti's tenement holding in the area (see Figure 5). The Tropicana Prospect was discovered using Air Core drilling that followed up on surface gold anomalies, delineated from geochemical sampling that was completed over Anglogold-Ashanti and Independence Group's land package (See Tropicana JV Update (4-Jul-06) at www.igo.com.au.)

Figure 5: Salmon Gums tenements location relative to the extent of AngloGold Ashanti and Independence Group's tenement.

Figure 6: Schematic cross-section showing target model for the Fraser Range North Project, regionally located close to the leading edge of the Albany-Fraser Mobile Belt which on-laps onto the Archaean Yilgarn craton. Crustal thickening andmagmatism along the suture maybe important in the ore forming processes.

¹Image is of interpolated percentile normalized gold data created using Surfer software with an inverse distance algorithm, using a four quadrant, defined distance (5000m) search radius and approximately 200m grid spacing. Normalization of soils is completed to account for the variability in gold concentration factors for the different soil types (e.g. carbonate overprinted soil has a higher average gold concentration than bulk soil). The surface soil types encountered over the large project areas include carbonate overprinted soil, lateritic soil and carbonate poor (bulk) soil. Open file data associated with historic work completed by BHP at Salmon Gums is classed as a fourth soil sample media. In order to allow direct comparison and imaging of these four sample media types, the data sets were normalized against each other, and raw gold values are recast as percentile values. By colouring and gridding on the basis of this percentile value the sample media types can be directly compared. Effectively, high values in the sample media with high gold concentration factors are levelled to lower values in less enriched sample media, theoretically providing a more coherent view of gold anomalism in the projects.

MCLATCHIE, G., 1995, Esperance Project Annual Report, BHP Minerals Exploration Department, WAMEX Open File Number A44173.

MCLATCHIE, G., 1996, Esperance Project Annual and Final Report, BHP Minerals Exploration Department, WAMEX Open File Number A46912.