The subject set of reports describes the results of PACE Initiative Year 4 partly-subsidised drilling work conducted in the vicinity of the Chianti prospect, which lies approx. 20 km north of the old Mount Gunson mining camp. The aim of this work, which was conducted by Gunson Resources NL in conjunction with its new joint venture partner Xstrata Copper Exploration Pty Ltd, was to assess the iron oxide - associated copper-gold (IOCG) mineralisation potential of several satellite residual gravity highs discerned to lie on the flanks of the main Chianti gravity anomaly, in the light of an encouraging, strongly mineralised but narrow drillhole core intercept of chalcopyrite and bornite that was made in late 2005 by Gunson Resources in its PACE Year 1 DDH MGD34 (2.01% Cu, 0.10 ppm Au, 2.4 ppm Ag, over the depth interval 548-552 m). Xstrata had proposed to underwrite up to 3000 m of drilling on 11 new targets arising from their recent reprocessing and interpretation of all regional aeromagnetic and gravity data using new lithostratigraphy and density models; 5 of these targets were identified as lying on the Emmie [Bluff] East and Chianti North gravity features, which had not previously been drilled. The latest PACE-assisted drilling programme was carried out during February-April 2007, and consisted eventually of just three directional diamond drillholes with RC precollars: MGD42 (total depth 1023.3 m, including a 300 m precollar), MGD44 (TD 607.32 m, including a 178 m precollar) and MGD45 (TD 801.17 m, including a 300 m precollar). No mineralisation was found, even though MGD45, the closest hole to the discovery at MGD34, was sited only 600 m north of it. The main contribution made by this new drilling activity was towards extending the understanding of the regional basement geology and topography. The local pre-Pandurra Formation palaeosurface was seen to have a linear depth gradient which increases northwards and westwards coming off the Chianti structural block, where the relief is in part due to past down-to-the-west movement along the north-south trending Cattlegrid Fault. A variably preserved, dacitic Gawler Range Volcanics section was intersected, overlying probable Hiltaba Suite (rather than Donington Suite) granitoid plutons and associated mafic dykes. The over 301 m thick and by far the thickest drilled sequence of GRV volcanic flows and underlying laminated tuffaceous sediments (?Tarcoola Formation equivalent) was present in hole MGD44, and its atypical development in relation to the succession seen in nearby drillholes suggests that it formed in a localised, steeply subsidised (?half-graben or collapsed caldera pipe) portion of the Chianti prospect with many similarities to the Carrapateena orebody setting. However, at Chianti the lateral distribution of drilling data on which to formulate a basement structural model is presently much too sparse. Therefore recommendations were made by Gunson Resources to carry on with additional close-spaced drilling in the vicinity of MGD34, addressing refined targets based on improved 3-D gravity modelling, besides acquiring both surface and downhole EM or IP data to try to locate conductive zones at depth.