An area centred about 40 km north-west of Fowlers Bay is being explored for possible buried economic nickel-copper mineralisation that may be hosted in a craton boundary setting by ultrabasic intrusive igneous bodies, in a manner similar to that of deposits occurring in the Ni-Cu mineralised Thompson Belt in Manitoba, or to the Voisey’s Bay deposit in Labrador. While detailed information on the bedrock geological sequence in the tenement area is not yet available due to the lack of any definitive work, the geometries evident in the aeromagnetic patterns, and the recording of mafic and ultramafic rocks elsewhere in the same structural province, were seen as favourable aspects to the proposed search. However, execution of the exploration strategy in this region is hindered by the fact that very little of the crystalline basement geology is exposed, because most of the district is covered by a 20 m to 100 m thickness of Tertiary and Quaternary Eucla Basin sediments. At about the time that the licence application was lodged for EL 3259, Iluka Resources announced that it had discovered nearby the very large Jacinth deposit of zircon-rich Tertiary mineral sands, and subsequent work done on Iluka’s extensive tenements and on those held by Adelaide Resources has shown that this general area of basinal cover is well endowed with marine palaeo strandlines which locally contain very significant heavy mineral fractions. Heavy mineral sands will therefore be a significant target also when Gunson begins drilling through the sedimentary sequences overlying the crystalline rocks which are believed to be prospective for nickel sulphide mineralisation. No field work was undertaken on the tenement during its first year. The work undertaken by previous tenement holders in the area was examined, some Landsat image coverage was obtained, and a preliminary proposal to conduct reconnaissance drilling over selected magnetic targets, utilising roads and fencelines for access, was formulated. Aspects of the sedimentary cover and its thickness, together with a preliminary interpretation of the Landsat data, were compiled into a report which is appended herein. No field work was able to be undertaken on the tenement during its second and third years. Work undertaken by previous tenement holders in the area continued to be examined, and the licensee spent much time finding out the requirements for gaining Native Title holder and aboriginal heritage land access clearance agreements, and later on attempting to contact and then negotiate successfully with relevant persons. During the fourth year of tenure, activities on EL 3259 were progressed to include: • Plotting and interpretation of airborne EM (TEMPEST) data recently overflown on the northern part of the subject licence by Iluka Resources Limited during March 2008 • Preparation and submission of a DEF and associated documents in order to obtain PIRSA approvals to access certain AEM anomalous localities for conducting a follow-up ground EM survey. After Iluka supplied Gunson with a copy of the AEM data acquired over EL 3259, an evaluation of it was completed by Gunson’s consultant geophysicist, Dr Jim Hanneson. 53 line kms of data were involved, acquired along flight lines spaced 2 km apart. Hanneson’s examination of the Iluka data revealed two indications of a basement-related sulphide response lying about 1 km apart, and a possible third (but weak) anomaly located some 8 km to the south-west. Subsequent to making the EM interpretation, Hanneson obtained additional open-file detailed aeromagnetic data for the area, and was able to advise Gunson about the magnetic setting of the EM anomalies (his technical memoranda are attached to the October 2008 licence annual report). Plans were made for performing follow-up ground TEM surveys over the selected AEM anomalies, to determine if viable drill targets existed there. In the fifth year of tenure, an in-field programme of moving loop ground TEM profiles using 150 m wide loops was carried out by contractor Outer Rim Geophysical Services during December 2008, and while atmospheric conditions were favourable early in the programme, the survey was eventually abandoned after 110 loops had been read, due to unacceptable noise in the data caused by thunderstorm activity. An initial assessment of the moving loop survey results made by Jim Hanneson concluded that some promising conductive anomalies existed at locations identified by the airborne EM survey, and this was confirmed by his subsequent in-depth model analysis. He recommended that follow-up infill fixed loop EM surveying be done, in the hope that increasing the strength of the returned signal at late times would resolve a drillable target. The fixed loop survey was completed in April 2009, using three 400 m x 200 m loops, and its results highlighted one drill-ready feature, for which an angled hole was predicted to intersect strong sulphide mineralisation at a downhole depth of 160-170 m. The second EM anomaly detected by the original airborne EM survey was also able to be identified in the limited fixed loop data, but is less well-defined. On the basis of the above ground EM surveying, Gunson prepared a DEF to submit to PIRSA, to seek approval for a future campaign of test RAB drilling at preferred EM and aeromagnetic anomaly sites in the northern part of the (soon to be renewed) licence. It was expected that this work would be carried out early in 2010. Success in the initial drilling would provide justification for carrying out a more extensive program of ground EM surveying, since such work completed to date has focussed only on the original features identified by the airborne survey, and as was noted by Hanneson, this survey may only have detected anomalies in areas where the surficial cover is at its thinnest. During the 2010-2011 licence year, the first of renewed EL 4440, new work consisted of: • Finalisation and approval of a DEF submitted to PIRSA for proposed exploratory drilling within the Yellabinna Regional Reserve, in the northern part of the licence area; • Subsequent completion of drilling of two rotary mud precollared, diamond cored holes; and • Preparation for conducting a follow-up program of down-hole geophysical logging and other related surface surveys. Drillhole FBD1 was spudded on 24/2/2011, and was drilled vertically to a total depth of 279.1 m, and drillhole FBD2 was spudded on 2/3/2011 and was drilled at an inclination of minus 60 degrees to TD 269.8 m. Crystalline basement in both holes was reached at shallower depths than had been predicted. Once it was clear that a resistant horizon had been penetrated, the rotary mud precollar drilling was stopped and the remainder of each hole was drilled using NQ coring (50 m and 39 m cored respectively). Since the drillholes were collared only 50 m apart (and because their top of basement entry points are even closer, due to the inclination of FBD2), the 16 m variation in basement depth indicates that there is considerable local topography on the unconformity surface. Basement in both holes consisted of cataclastic and gneissic granitoid rocks showing few signs of alteration or mineralisation, apart from occasional specks of pyrite. The drill core from each hole was chip-sampled over 5 metre intervals to provide a geochemical log, but the assay results were predictably uniform and low. No detrital heavy minerals were seen in samples collected from the cover sediments interval of each hole. After the completion of drilling, a crew was mobilised to undertake downhole geophysical logging, but blockages in each hole caused difficulty with this work. In late April 2011, Apex Drilling returned their drill rig to the site, successfully cleared the blockages, pulled out all of the old PVC casing, and then re-cased FBD 1 and 2 to permit unhindered downhole TEM logging. This hole remediation took until August to be finished. A limited scan of drill core conductivity was made, but no SG or magnetic susceptibility readings were taken. The gneissic lithologies were found to be very resistive, being several orders of magnitude too resistive to comprise the type of conductor expected to yield any late time responses to a surface TEM survey current input system. During the 2011-2012 licence year, Gunson Resources undertook the downhole geophysical logging in conjunction with running three lines of surface TEM readings, and acquired a detailed airborne helimag/rad survey over the drilled part of the licence area. The downhole TEM was done with 300 m loops and the surface TEM used 50 m loops. Geophysical interpretation of the data concluded that the surface TEM anomaly tested with holes FBD 1 and FBD 2 was a flat lying conductor in the cover sequence at 35-45 m depth, an unexpected outcome. 1186 line km of airborne survey were flown during October 2011 along flight lines spaced 100 m apart, using a 25 m mean sensor elevation, to provide detailed prospect-scale geophysical data which should help guide future nickel sulphide exploration. During the 2012-2013 licence year, Gunson Resources commissioned expert studies on geological/geophysical targeting within the Fowler Domain from two respected former WMC and BHP Billiton exploration targeting specialists, Dr Jon Hronsky and Dr Douglas Haynes. Hronsky’s targeting work was completed in mid-March 2012, concluding that the Fowlers Bay EL represents a world class greenfields nickel sulphide target area, with its relatively thin but almost complete basinal cover sequence overlying a conceptually prospective belt. However, Hronsky’s interpretation of the Fowlers Bay region as similar to the Archaean Selibe-Phikwe belt in Botswana was of concern to the licensee, and so an alternative view was sought from the originator of the Fowlers Bay exploration model, Douglas Haynes. He was not available to provide advice until early in 2013, but he confirmed his disagreement with Dr Hronsky about the metallogenetic setting. Once he was able to review all of the now augmented geophysical and geological data, he recommended to Gunson Resources three discrete target positions for Proterozoic mafic-ultramafic intrusive associated nickel-copper sulphide mineralisation, in the vicinity of the major craton-bounding fault arrays present in the licence area. These positions would require screening by ground geophysical surveying. During the 2013-2014 licence year, in November 2013, Gunson Resources acquired a semi-detailed ground gravity survey to delineate one of Haynes' three recommended target positions, with 343 stations read at 200 m x 400 m spacing over a rectangular target area approximately 9 km long by 3.5 km wide. Prior to this the company had obtained land access permissions for the parts of the survey coverage which lay in the Yalata Aboriginal Reserve and Yellabinna Regional Reserve. The results of the survey showed that a north-south trending belt of gravity anomalies coincides with the central of 3 belts of magnetic anomalies in the survey area. Two drill traverses were proposed to cross the gravity anomalous belt to test the basement for dense mafic to ultramafic rocks which may be prospective for nickel sulphides. 10 RC holes were to be spaced about 150 m apart along east-west traverses 600 m long. During the 2014-2015 licence year, a high resolution 38,981 line km fixed wing airborne magnetic/DEM survey was acquired by WSA over the period November 2014 - January 2015 along SE-NW flight lines 100 m apart using a mean sensor height above the ground surface of 40 m. A detailed interpretation of the processed survey data was begun in February 2015, and a preliminary magnetic target location map was prepared showing the proposed sites of ~20 initial planned exploratory/stratigraphic drillholes. These holes will become essential sources of important but as yet quite unknown information concerning basement rock geochronology, lithogeochemistry, hydrogeochemistry and petrology. In late 2014, discussions with the area's Native Title traditional owner groups and with DEWNR were started concerning aboriginal heritage clearance surveys and solutions to other environmental protection matters that are required for obtaining consensual on-ground exploration access to traditional lands and Regional Parks.