The 100%-owned Blackrock EEL covers an area of 299 sq km within the northern Afar region and is located 18 km east of the small town of Berahale. Within the licence area, four separate zones of low-sulphidation mineralisation - Calcite, Airstrip, Black Water and Magdala - have been identified over a distance of 15.9 km from north to south and are hosted within structures associated with Red Sea-parallel half-graben faults.

Figure 1. Blackrock licence, highlighting key mineralised zones identified to date
The setting of the Blackrock mineralisation is very similar to Megenta, which is 260 km to the south. The veins at Blackrock contain colloform chalcedony and also abundant calcite that has been replaced by silica. Much of this calcite exhibits a pre-replacement bladed texture (Fig. 2) that often reflects boiling of the fluid, a phenomenon that is commonly associated with the precipitation of very high 'bonanza' concentrations of gold (more than an ounce per tonne), the presence of which has now been confirmed with grades reaching up to 60.4 g/t Au (Fig. 4).

Figure 2. Bladed calcite replaced by silica
Mineralisation in the most southern prospects, Black Water and Magdala, comprises a series of well-banded quartz veins (Fig. 3). Total vein widths range along strike from a minimum of 1 metre to a maximum of greater than 28 metres, including gold-bearing silicified halos surrounding or between the veins. Vertical continuity of the vein systems has been measured over 70 metres, from the top of the topographically prominent veins to exposures in the valley floor. Values obtained from early sampling at Black Water include best channel-chip samples of 0.48 metres grading 1.97 g/t Au and 1.2 metres grading 0.97 g/t Au, together with 2.17 g/t Au and 2.66 g/t Au from selective samples of banded quartz veins.

Figure 3. Looking south towards Black Water, with exposed chalcedonic silica and replaced calcite in the foreground. Approximately 600 m exposed strike distance
Recent mapping has identified five substantial NW-SE-striking vein systems at Black Water - Stanley, Nesbitt, Oasis, Theodore and Baker (south-west to north-east, Fig. 4). The Theodore vein system has been traced for a distance of 1,600 metres and the other systems are between 700 metres and 1,100 metres in length.

Figure 4. Black Water vein structures - Stanley, Nesbitt, Oasis, Theodore and Baker (SW to NE)
To date, three of these, Theodore, Oasis, and Nesbitt, have been systematically channel-chip-sampled (Figs. 5,6). Significant values include:
Theodore Vein System

Figure 5. Sampling results over Theodore and Oasis veins - key gold grades highlighted in bold.
Nesbitt Vein System

Figure 6. Sampling results over Nesbitt vein - key gold grades highlighted in bold.
Oasis Vein System
Stanley Vein System
The Company believes that the Black Water sampling results provide considerable prospectivity for the identification of further gold-bearing veins elsewhere in the four zones identified to date within the Blackrock EEL (Calcite, Discovery, Black Water and Magdala), in particular at the Calcite zone where early stage sampling returned a peak value of 4.09 g/t Au, as well as 2.3 g/t Au from a grab sample of silicified sediment (Press Release 28 February 2011). The Company will also evaluate the potential for bulk-tonnage, open-pittable mineralisation at surface, following-up on initial sampling of an altered conglomerate that returned a peak value of 4.28 g/t Au over 0.5 metres.
Figure 7. Early drilling on Theodore Structure, Black Water Zone
Drilling is now underway on the Black Water Zone (Fig. 7) and the Company anticipates updating the market in Q1-2012.