A C N 0 0 8 9 8 2 4 7 4 1st Floor, 8 Parliament Place West Perth WA 6005 PO Box 1618 West Perth WA 6872 Tel: (08) 9481-7833 Fax: (08) 9481-7835 Email: [email protected] Website: www.austunitedgold.com 20 November 2006 The Manager - Companies Australian Stock Exchange Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2000 Dear Sirs, STRONG POTENTIAL FOR LARGER RESOURCE AT THE MANINDI ZINC PROJECT HIGHLIGHTS • Down Hole Electromagnetics (DHEM) & Grade Modelling at both Warabi (Zone A) & Mulgara (Zone B) strongly indicates the presence of further mineralisation at depth. • Modelling shows that the resource positions at Warabi & Mulgara have been extended by recent drilling and have strong potential of continuing at depth. • The target areas generated from this modelling will be tested in the upcoming diamond drilling program. Metals Australia Ltd is pleased to announce the modelling of the Down Hole Electromagnetic (DHEM) program recently completed at Warabi (Zone A) & Mulgara (Zone B). Diamond drill holes were emplaced at the northern end of both Warabi & Mulgara to facilitate the DHEM program in September. The results of the DHEM and ‘grade’ modelling is as follows: 1 1. WARABI (ZONE A) The current JORC compliant resource at Warabi, utilising a 1% Zinc cut-off grade, is: 119,350 t @ 8.42% Zn A single drill hole was emplaced to the west and adjacent to the northern extensions of Warabi main lode. This hole was then used to facilitate the DHEM survey. This survey successfully located a dipping conductor to the east of the drill hole in the target position shown on the attached diagram. A geological study of the ore system, which included long & cross sectional analysis, confirms this target area, which will be further tested by the upcoming drilling program. It should be noted, that despite the resource for this area having yet to be recalculated, recent drilling in this area has increased the physical size of this deposit, both to the north and at depth. Recent drilling by Metals Australia has included the following results: MNRC 008 664246E 6818038N 44-49 m 5m @ 11.8% Zn MNRC 014 664314E 6817997N 43-61 m 18m @ 14.96% Zn 2. MULGARA (ZONE B) The current JORC compliant resource at Mulgara, utilising a 1% Zinc cut-off grade, is: 218,240 t @ 7.77% Zn A single drill hole was emplaced to the east and adjacent to the northern extensions of Mulgara main lode. This hole was then used to facilitate the DHEM survey. This survey successfully located a dipping conductor to the east of the drill hole in the target position shown on the attached diagram. A geological study of the ore system, which included long & cross sectional analysis, confirms this target area, which will be further tested by the upcoming drilling program. It should be noted, that recent drilling in this area combined with the DHEM & grade modelling indicate that the ore system has a northerly plunge component and remains untested along strike, at depth. Recent drilling by Metals Australia has included the following results: MNRC 012 664174E 6818174N 23-39 m 16m @ 7.40% Zn MNRC 013 664211E 6818144N 82-92 m 3m @ 16.90% Zn 2 The grade modelling shown on the accompanying diagram shows the grades and drill hole ‘pierce-points’ on the main lode of each ore body, which contains the majority of the resource tonnage. The diagram is a slice along the long axis of the deposits, with north on the right hand side of the page. Warabi & Mulgara also contain a number of smaller/ discontinuous ‘footwall’ and ‘hanging wall’ lodes that add incremental tonnage to a mining scenario; these smaller lodes are not represented on the attached diagram. A program of diamond drilling is currently being planned to test the target zones delineated at Warabi & Mulgara, and should commence in either December 2006 or January 2007, subject to drill rig availability. KULTARR & KOWARI (ZONE D) The current JORC compliant resources at both Kultarr & Kowari , utilising a 1% Zinc cut-off grade, are: 715,060 t @ 7.46% Zn The interpretation and modelling of Kultarr & Kowari (Zone D) is currently being finalised and will be announced in the near future. Yours faithfully Metals Australia Limited Norman Grafton Company Secretary Competent Person Declaration The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Timothy Putt of Exploration and Mining Information Systems, who is a member of The Australasian Institute of Geoscientists. Mr. Putt has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resource and Ore Reserves”. Timothy Putt consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. 3 GRADE MODELLING & EM TARGET ZONE 6818200 mN 300 mN 6818050 mN 6818100 mN 6818150 mN 6818250 mN 6818200 mN 6818050 mN 6818100 mN 6818150 mN 6818250 mN 550 RL 350 RL 400 RL 400 RL 450 RL 450 RL 500 RL 500 RL 6817900 mN 6817950 mN 6818000 mN 550 RL 300 mN 6817900 mN 6817950 mN 6818000 mN 350 RL MULGARA (ZONE B) INFERRED WARABI (ZONE A) FAULT APPROX SURFACE GRADE MODELLING & EM TARGET ZONE (AT PRESENT) 119.794 0.17832 50.7 7.8633 MNRC013 FRC037 MNRC007 0.892 2.23 0.0134 60.77 0.0286 0.0289 108.867 186.7 -0.0198 38 0.018 269.28 59 0.14 3.77 1.78 0.723 94.373 11.32 5.95 2 0.0276 63.3732 7.524 181.455 51 90.92 180.64 96.8 5.59 118.4 FRC008 FWD004 FRC030 FWD002 FWP001 FRC028 FRC007 FWD005 FWD007 FWD001 FRC027 MNRC014 MNRC008 FRC063 FRC012 PH003 FRC011 FRC032 FRC035 FWD009 FRC032 FRC013 FRC031 FRC033 FWD010 FRC034 FRC012 FRC062 FRC044 FRC011 FRC035 MNRC012 Author: TSP Office: Perth Drawing: EMIS Date:16/11/2006 Scale: 1:1000 Projection: Non-Earth (meters) 40 METALS AUSTRALIIA LTD MANINDI ZINC PROJECT WARABI & MULGARA RSC MAIN LODE CONTOURED LONG SECTION (ZINC% METRES) 0 10 20 metres MLS Manindi LS (Zn% Metres) 250 to 1,000 (1) 100 to 250 (6) 50 to 100 (8) 25 to 50 (1) 10 to 25 (1) 5 to 10 (4) 2.5 to 5 (1) 0.5 to 2.5 (5) 0 to 0.5 (7) -999 to 0 (1) 6819000 mN 6818500 mN 6818000 mN 666000 mE 665000 mE 666000 mE 665500 mE 665000 mE 665500 mE 664500 mE 664500 mE 6819000 mN 6818500 mN 6817500 mN 664000 mE 663000 mE 663500 mE 663500 mE 664000 mE 6817500 mN 663000 mE 6818000 mN FRC 018 81-94m 13m @ 0.27% Zn NUMBAT FWD 012 41.97-44.5m 2.53m @ 2.35% Zn NINGAUI FRC 018 81-94m 13m @ 0.27% Zn MNRC 015 71-74m 3m @ 1.00% Zn BANDICOOT Surface Sampling up to 444 ppm Zn MNRC 002 82-86m 4m @ 1.58% Zn 603,130 t @ 7.66% Zn 111,930 t @ 6.43% Zn KULTARR (Zone D Nth) KOWARI (Zone D Sth) MULGARA (Zone B) 218,240 t @ 7.77% Zn QUOLL WARABI (Zone A) 119,350 t @ 8.42% Zn Surface Sampling up to 620 ppm Zn MNRC 005 15-18m 3m @ 0.62% Zn M 57/227 M 57/240 P 57/934 P 57/935 Author: EMIS Office: Perth Drawing: TSP Date:17/11/2006 Scale: 1:8000 Projection: MGA Zone 50 (GDA 94) 300 MANINDI ZINC PROJECT CONTOURED SURFACE GEOCHEM WITH BOTH PROSPECT & RESOURCE LOCATIONS METALS AUSTRALIIA LTD 0 75 150 metres Manindi Geochem (Zn ppm) 5,000 to 10,000 (4) 1,000 to 5,000 (61) 500 to 1,000 (94) 250 to 500 (132) 100 to 250 (230) 50 to 100 (325) 25 to 50 (587) 0 to 25 (262)
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