EL 2937 licensee Southern Cross Resources has utilised PACE Initiative Year 2 funding assistance to carry out a collaborative drilling project to test 2 primary base metal/uranium targets within Willyama Group basement at a location 5 km south-east of the Honeymoon uranium deposit. Three drillholes totalling 900 m were proposed to test separate magnetic and EM anomalies thought to represent possible buried occurrences of epithermal skarnoid IOCG-type mineralisation overprinting pre-existing Bimba Formation - style (Hunters Dam, Ram Dam, etc.) syngenetic base metal anomalism in the marginal portions of a known uraniferous granite intrusive. An analogue to this style of mineralisation exists to the north along the Benagerie Ridge, in settings on the rim of this interpreted intrusive complex that provided for the influx of Cu-Au-Mo-U-REE mineralisation to IOCG prospects including Portia/North Portia, Shylock and Kalkaroo. In the regional magnetic data, the general area of interest was characterised as a small amplitude magnetic low anomaly juxtaposed against the Bimba Horizon regional magnetic anomaly. Modelling of the regional gravity dataset showed distinct perturbations in the 1 km residual gravity contours, which appeared to coincide with such subtle demagnetisation of the usually strong magnetic character of the Upper Curnamona Group stratigraphy. As part of its brownfields exploration on EL 2937 near the Honeymoon deposit, Southern Cross Resources in 2002 drilled RC hole H455 into the centre of the circular magnetic low, and retrieved a bottomhole core containing an interval of strongly weathered felsic granite that yielded highly anomalous uranium assays peaking at 76 ppm U. Subsequently, the licensee in 2003 conducted an airborne EM survey over the area, utilising E-W flight lines at 1 km spacing and a nominal 120 m sensor flight altitude. One of the flight lines disclosed a high tenor conductive (~ 0.05 ohm-m resistivity) basement feature 600 to 1000 m wide, with an approximate depth below surface of 150-200 m. This feature lies near the edge of the uraniferous high-level granite encountered by drillhole H455, where it is interpreted to have intruded into the carbonate and sulphide-rich Bimba Formation, thereby forming a body of potentially sulphide-mineralised graphitic schist. Previous drilling in 1998 by Rio Tinto one km away along strike (AC98YM067 & AC98YM054) encountered gossanous lithologies with highly anomalous Zn-Pb-Cu-Co-As geochemistry, confirming the local presence of mineralisation in the Bimba Formation. The latest target area has been called the Maxwell prospect. During March 2006, contractor Tom Browne Drilling Services completed just two NQ diamond coreholes with open hole RAB precollars, for a total penetration of 640.8 m (284.2 m cored). The third hole YAM054C was abandoned at 66 m depth prior to casing off the precollar. Extremely poor drilling conditions in the precollar sections of both the other drillholes had earlier necessitated several attempts to reach the basement, and had led to lost drilling equipment and large cost over-runs, plus some limitation of the technical results. Hole YAM052C, drilled to a total depth of 200.2 m on the magnetic anomaly at target Area 1, penetrated a two-mica granite body beneath 109 m depth which shows weak to strong feldspar - destructive alteration, that progresses through sericitic to chloritic to sodic phases with increasing depth. Assuming that the entire interval cored has sampled a single phase of the intrusive, then the granite is characterised by an equigranular - textured assemblage of quartz-plagioclase-alkali feldspar-muscovite-biotite. Some of the biotite appears blueish in colour, and the muscovite appears bronzeish in colour: there is no hornblende, no cordierite and no garnet. The granite has therefore been classified as an alaskite, but more petrographic needs to be done to identify the granite petrogenetic type, and its degree of fractionation. YAM052C was downhole geophysically logged using a gamma tool (for uranium grade estimation), and an induction tool (for lithological characterisation). There is a steady increase in gamma log count, and in drill core sample uranium values from XRF assay, with increasing hole depth. It is unclear as to whether the increase in gamma readings (as a direct measure of potential U mineralisation) is related to the changes in alteration style, or to a decrease in weathering effects. Hole YAM053C, drilled to a total depth of 300.4 m on the EM anomaly at target Area 2, penetrated only the Bimba Formation, which consisted of a sequence of massive to laminated metasiltstones that have had their original sedimentary textures largely lost. A significant epidote / albite alteration zone is present from 130-145 m depth, below which some minor carbonate veining with trace sulphides is evident near 250 m depth. Closer to TD, potassic alteration of the metasiltstones also occurs. Poor drilling conditions precluded the installation of PVC casing into YAM053C which would have enabled subsequent probing with a downhole EM system. The granite as tested by YAM052C is richly uraniferous over a very wide area. This fact presents possibilities in terms of a huge resource of low grade primary uraniferous material, analogous to the intrusive-related uraniferous system of Rossing in Namibia. It is highly probable that the granite intersected by YAM052C is the source of the uranium for the Tertiary sandstone-hosted mineralisation discovered at Honeymoon. Accordingly, other palaeochannels that would have drained through this granite will become an important locus for ongoing exploration for Tertiary roll-front style uranium mineralisation. Encouraging low-grade base metal sulphide mineralisation (with gold up to 0.14 ppm) was intersected in YAM053C. Limited follow-up drilling of this mineralised zone has been recommended.