Wednesday, 15 November, 2006

by CMR
ASX announcement

New drill results continue to improve the definition of and confidence in the previously announced JORC compliant uranium resource of 14.5 million pounds contained U3O8 at this prospect (ASX report of 14 July 2006).

Assay results are now available for a further 20 R/C drill holes (2,323 metres). The location of holes relative to the surface projection of the Mt Fitch uranium mineralisation is shown in Figure 1. The main uranium intercepts are summarised in Table 1.

Latest drilling has recorded grades exceeding 1% (22 lbs/tonne) U3O8 over 1 metre intervals within a broad envelope of uranium mineralisation outlined in Figure 1. It also shows evidence that the uranium deposit overlaps the Mt Fitch oxide copper resource to the east and a newly discovered zone of copper, cobalt and nickel mineralisation above the Uranium rich zone to the northwest.

Apart from fully delineating the resource, an important aspect of the current drill programme is to close up drill spacing in order to provide improved resource reliability in areas where less reliable holes drilled in the 1960’s predominate. This will enable JORC resources to be converted to minable reserves applying costs developed by the Mt Fitch uranium development study (in progress) anticipated for completion in January 2006.

The drill programme is showing that good uranium grades occur over an intercept thickness up to 130 metres (hole 06MF035 radiometric log interpretation) near the centre of the deposit, breaking up into a series of stacked lenses varying from several metres to 20 metres at the margins. The distribution of mineralisation is very favourable for a simple open pit mining operation.

It is noteworthy from holes 06MF029 and 06MF030 that oxidised copper mineralisation, associated with high grade cobalt nickel, occurs along the margin of the previously announced Mt Fitch copper resource. It now appears that these two deposits overlap in part along the eastern margin of the Mt Fitch uranium resource. Further drilling will be undertaken to better define this relationship and to determine its extent. A number of copper intercepts have also been recorded along the northwestern margin of the uranium resource (which has not been fully closed off at this time). Potential exists for a new copper-cobalt-nickel deposit in this area along the western margin of the uranium deposit.

Of particular importance is the high cobalt and nickel grades recorded in the recent intercepts. Holes 06MF013, 06MF018 and 06MF025 low grade mineralisation was indicated from radiometric log and these holes were not assayed. Further results such as from hole 06MF035 will be released when chemical assays are received from the laboratory.

Once all drill results are available from the 2006 drill programme, data will be recompiled and a revised resource estimated. Results to date confirm the potential for Mt Fitch to be an early development project. Other uranium prospects are currently being explored and drill programmes planned (including programmes for 2006) with the objective of expanding Compass’ total uranium resources in the Rum Jungle mineral field.