2nd ironoxide system intersected at diamantin

11 September, 2008
ASX Release
A SECOND IRON-OXIDE INTRUSIVE SYSTEM
INTERSECTED AT DIAMANTINA
AusQuest Limited (ASX: AQD) advises that diamond drilling at the Mulligan Prospect,
located approximately 120km west of the diamond drill-hole at the Machattie Prospect which
was reported to the ASX on the 14th August, has been completed. Both prospects occur within
the Diamantina Project located approximately 450 km south of Mt Isa in western Queensland.
Drilling intersected a second large Iron-Oxide intrusive system from 900 metres to the end
of the hole at 1,500 metres, which the Company believes is similar to the one intersected at
the Machattie prospect. Increased alteration of the magnetite-pyroxenite host-rock, and an
increase in the number of granitic dykes suggests a mixing of magma types at Mulligans,
which has recently been postulated by some researchers to occur below Iron Oxide-Copper
Gold (IOCG) deposits at Olympic Dam in South Australia and Ernest Henry in Queensland.
Drilling also intersected a zone (~3 metres) of disseminated sulphides (~10% by volume),
including visible chalcopyrite mineralisation, at ~1478m depth, which is the first sign of base
and precious metal mineralisation at the Mulligan Prospect.
Drill core has been systematically sampled and sent for analysis. Selected samples were
collected for microscopic study. Results are expected within the next six to eight weeks.
The Mulligan drill-hole was drilled to establish whether other coincident gravity and magnetic
anomalies occurring in the Diamantina area, could be caused by IOCG systems which can
contain significant occurrences of copper and gold mineralisation.
Based on results to date, the Company believes there are at least eight gravity/magnetic
targets of varying amplitude at Diamantina, that may represent IOCG exploration targets.
Further exploration within the Diamantina Project area will be planned once all analytical
results have been received and assessed.