doray minerals limited...2009/12/16 · doray minerals limited acn 138 978 631 prospectus for the...

DORAY MINERALS LIMITEDACN 138 978 631

PROSPECTUS For the offer of 30,000,000 ordinary Shares at an offer price of 20 cents each to raise up to

$6,000,000 with the right to accept over-subscriptions of up to $2,000,000 for a maximum of $8,000,000

SPONSORING BROKERSHAW STOCKBROKING LIMITED

Important Information

This Prospectus provides important information to assist prospective investors in deciding whether or not to invest in the Company. It should be read in its entirety. If you do not

understand it, you should consult your professional advisers.

THE SHARES OFFERED UNDER THIS PROSPECTUS ARE OF A SPECULATIVE NATURE.

MINERALS LIMITED

DORAYMINERALS LIMITED

DORAY

DORAY MINERALS LIMITED PROSPECTUS

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DirectorsBrett Fraser – Non-Executive Chairman Allan Kelly – Managing DirectorHeath Hellewell – Technical DirectorJay Stephenson – Non-Executive Director

company secretaryJay Stephenson

registereD office Unit 6, 34 York StreetNORTH PERTH WA 6006

Telephone: +61 (0)8 6468 0388 Facsimile: +61 (0)8 9228 0704

Website: www.dorayminerals.com.au Email: [email protected]

share registrarComputershare Investor Services Pty Ltd Level 2, 45 St Georges Terrace PERTH WA 6000

Telephone: 1300 557 010 Telephone: +61 (0)3 9415 4000 Outside Australia Facsimile: +61 (0)8 9323 2033 Email: [email protected]

sponsoring BrokerShaw Stockbroking Limited Level 15, 60 Castlereagh Street SYDNEY NSW 2000

Telephone: 1800 636 625 Fax: +61 (0)2 9232 1296

solicitors to the companySteinepreis Paganin Level 4 16 Milligan Street PERTH WA 6000

inDepenDent geologistsDavid Tonkin and Associates 25 Palmerston Road UNLEY SA 5061

Malcolm Castle Consulting Geologist PO Box 473 SOUTH PERTH WA 6951

corporate aDviserWolfstar Group Pty Ltd Unit 6, 34 York Street NORTH PERTH WA 6006

investigating accountantPendragon Capital Ltd Barringtons House 283 Rokeby Road SUBIACO WA 6008

corporate Directory


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important informationThis Prospectus is dated 20 November 2009 and was lodged with the Australian Securities and Investments Commission (“ASIC”) on that date. Neither ASIC nor ASX Limited (“ASX”) takes any responsibility for the contents of this Prospectus. No Shares will be issued on the basis of this Prospectus later than 13 months after the date of this Prospectus. The Directors of, and advisers to the Company do not guarantee the success of the Company, the repayment of capital, the payment of dividends or the price at which Shares will trade on ASX.

Application will be made to ASX within seven (7) days of the date of this Prospectus for Quotation of the Shares the subject of this Prospectus. It is important that investors read this Prospectus in its entirety and seek professional advice where necessary. The Shares subject of this Prospectus should be considered speculative.

electronic prospectusThis Prospectus will be issued in paper form and as an electronic Prospectus which may be accessed on the internet at www.dorayminerals.com.au. The Offer of Shares pursuant to the electronic Prospectus is only available to persons receiving an electronic version of this Prospectus in Australia. The Corporations Act prohibits any person passing onto another person the Application Form unless it is attached to, or accompanied by, the complete and unaltered version of the Prospectus. During the Offer Period, any person may obtain a hard copy of this Prospectus by contacting the Company by email at [email protected].

foreign JurisDictionsThis Prospectus does not constitute an offer in any place in which, or to persons to whom, it would not be lawful to make an offer. Distribution of this Prospectus in jurisdictions outside Australia may be restricted by law, and persons who come into possession of this Prospectus should seek advice and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.

exposure perioDThis Prospectus will be circulated during the Exposure Period. The purpose of the Exposure Period is to enable this Prospectus to be examined by market participants prior to the raising of funds. Potential investors should be aware that this examination may result in the identification of deficiencies in the Prospectus and, in those circumstances, any application that has been received may need to be dealt with in accordance with Section 724 of the Corporations Act.

Applications for Shares under this Prospectus will not be processed by the Company until after the expiry of the Exposure Period. No preference will be conferred on persons who lodge applications prior to the expiry of the Exposure Period.

WeBsite aDDressThe Prospectus can be downloaded from www.dorayminerals.com.au.

photographs anD DiagramsItems and undertakings depicted in photographs and diagrams in this Prospectus are not assets of the Company, unless otherwise stated. Diagrams appearing in this Prospectus are illustrative only and may not be drawn to scale.

DefinitionsThroughout this Prospectus abbreviations and defined terms are used. Those relevant to mineral exploration are contained in the Glossary located in the first Independent Geologist Reports in Section 5 of this Prospectus, and other abbreviations and legal terms are contained in the Definitions in Section 11 of this Prospectus. Defined terms are generally identified by the uppercase first letter.


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risk factorsThe Shares offered by this Prospectus are of a speculative nature. Prospective investors should carefully consider the risk factors outlined in Section 4 of the Prospectus which include:

• no guarantee of exploration success;

• resource estimates are imprecise and may prove to be inaccurate;

• commodity price volatility and exchange rate risks;

• joint venture partner risk; and

• joint venture uncertainty of terms risk.

In particular the following specific risk should be considered:

Uranium policy risk

The Company has consented to uranium exploration being conducted on the Harris Bluff and Kingoonya Gawler Craton Projects located in South Australia pursuant to a uranium joint venture involving Venture Minerals Limited and Mega Hindmarsh Pty Ltd. Uranium mining is subject to extensive regulation by State and Federal Governments. For further discussion on uranium mining and associated risk factors, please refer to information on uranium policy set out in Section 4 of this Prospectus.

importantThe information in this Section is a summary of the key points only and is not intended to provide comprehensive details of the Offer. Prospective investors should read the full text of this Prospectus and, if in any doubt, consult with their professional advisers before deciding whether to apply for Shares. The Shares offered under this Prospectus carry no guarantee in respect of return of capital, return on investment, payment of dividends or the future value of the Shares.


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key Dates

Lodgement of this Prospectus with ASIC 20 November 2009

Opening Date of the Offer 27 November 2009

Expected Closing Date of the Offer 09 December 2009

Dispatch of Holding Statements 15 December 2009

Expected date for Shares to commence trading on ASX 18 December 2009

The above dates are indicative only and may vary, subject to the requirements of the Listing Rules and the Corporations Act.

summary of the offer

minimum subscription $4,000,000

full subscription $6,000,000

over subscription $8,000,000

Offer price per Share $0.20 $0.20 $0.20

Shares currently on issue 15,500,000 15,500,000 15,500,000

Shares pursuant to this Offer 20,000,000 30,000,000 40,000,000

Vendor Shares 9,125,000 9,125,000 9,125,000

Total Shares on issue on listing on ASX 44,625,000 54,625,000 64,625,000

Market Capitalisation at the Offer Price $8,925,000 $10,925,000 $12,925,000

Refer to Section 1.5 of this Prospectus for further information, including details of the issue price of Shares on issue at the date of this Prospectus, the dilutive effect of these Shares and the number of Options granted in the Company.


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contents

chairman’s letter 6

sections:

1. Details of the offer 7

2. overview of the company and projects 12

3. Directors and management 19

4. risk factors 20

5. independent geologist’s reports 23

5(a) Western australian projects 23

5(b) south australian projects 51

6. investigating accountant’s report 67

7. solicitor’s report on tenements 76

8. material contracts 107

9. additional information 109

10. Directors’ consents 119

11. Definitions 120

application form and instructions to applicants 123


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chairman’s letter

20 November 2009

Dear Investor

On behalf of the Directors of Doray Minerals Limited (“Doray” or “the Company”), it is my pleasure to introduce this Prospectus to you and invite you to become a Shareholder of the Company.

This Prospectus has been issued by Doray for the purposes of offering 30 million Shares at $0.20 each to raise $6 million before costs. Up to a further $2 million may be raised through oversubscriptions.

Doray was incorporated on 20 August 2009 for the purpose of exploration and development of the projects described in Section 2 of this Prospectus and for investment in resource opportunities.

The Company has successfully secured strategic tenement holdings in the Murchison region of Western Australia and Central Gawler region of South Australia.

The Western Australian projects comprise a number of large tenement areas positioned on major regional mineralised structures, adjacent to known gold deposits which are thought to be underexplored.

The Central Gawler projects in South Australia are also located on major mineralised structures along strike from historic and recently discovered gold mineralisation.

The Board therefore believes these projects contain a number of exciting opportunities.

Considerable experience in exploration and project generation through the Executive Directors Allan Kelly and Heath Hellewell is enjoyed by the Company. With over 32 years combined experience in targeting and exploring large gold and nickel projects, Doray is fortunate to secure the services of such knowledgeable and skilled technical individuals.

This Prospectus contains detailed information about Doray and the Company’s current exploration projects in addition to independent professional reports. Please read this Prospectus carefully before you make your investment decision and, where necessary, consult your professional advisers.

Once again, on behalf of the Board, I invite you to become a Shareholder in Doray and a part of this exciting investment opportunity.

Yours sincerely

Brett fraser CHAIRMAN


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1. Details of the offer

1.1 introDuctionThe information set out in this Section is not comprehensive and should be read together with the other information in this Prospectus.

1.2 the offer anD suBscriptionThe Company is offering Shares for subscription at 20 cents per Share.

The Offer is for the issue of up to 30,000,000 Shares to raise up to $6,000,000. The Company reserves the right to accept over-subscriptions up to $2,000,000 through the issue of a further 10,000,000 Shares. The maximum amount which may be raised under this Prospectus is therefore $8,000,000 through the issue of 40,000,000 Shares. The minimum subscription of the Offer is 20,000,000 Shares to raise $4,000,000.

All Shares issued pursuant to this Prospectus will be issued as fully paid ordinary Shares and will rank equally in all respects with the Shares already on issue. The rights attaching to the Shares are summarised in Section 9.4 of this Prospectus.

If the minimum subscription for the Offer is not achieved within four months after the date of this Prospectus, or such longer period as is permitted under the Corporations Act, all applications will be dealt with in accordance with the Corporations Act.

1.3 offer perioDThe Offer will open on the Opening Date and will remain open until 5.00 pm (WST) on the Closing Date. The Company reserves the right to close the Offer at an earlier time or date or to extend the time or date without prior notice. Applicants are encouraged to submit their Applications as early as possible.

1.4 purpose of the offerThe purpose of the Offer is to raise the necessary funds to allow the continued exploration of the Company’s projects described in this Prospectus.

The proposed application of funds over two years from the date on which the Shares allotted under this Prospectus are quoted on ASX is as follows:

use of funds notesminimum

subscription $4,000,000

full subscription $6,000,000

over subscription $8,000,000

Pre-offer cash 296,000 296,000 296,000

Total raised in the Offer 2 4,000,000 6,000,000 8,000,000

total funds available 4,296,000 6,296,000 8,296,000

Exploration expenditure 3 2,000,000 3,030,000 4,050,000

Expenses of the Offer 4 249,024 275,524 310,867

Application handling fees 240,000 360,000 480,000

Vendor Payments 126,000 126,000 126,000

Administration 884,288 884,288 884,288

Investment Opportunities and general working capital

5796,688 1,620,188 2,444,845

total funds applied 4,296,000 6,296,000 8,296,000

Notes:

1. If the Company raises more than the minimum subscription, but less than the full amount of $6,000,000 the Company intends to apply these funds first to the application handling fee and secondly to the exploration expenditure.

2. If the Company raises more than the full subscription, the Company intends to apply these funds first to the application handling fee and secondly to the exploration expenditure.

3. Exploration expenditure is described in more detail in Section 2.4 of this Prospectus.

4. Refer to Section 9.9 of this Prospectus for a breakdown of the expenses of the Offer.

5. Unallocated working capital will be conserved to allow for evaluation of and securing of new exploration opportunities.

6. All allocated exploration expenditure is proposed to be spent on granted tenements.


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The above table and the exploration programmes and associated expenditure outlined in Section 2 of this Prospectus are statements of current intentions at the date of the lodgement of this Prospectus with ASIC. As with any budget, intervening events (including exploration success or failure) and new circumstances have the potential to affect the ultimate way funds will be applied. The Board reserves the right to alter the way funds are applied in these circumstances.

the Directors are satisfied that, upon completion of the issue, the company will have sufficient working capital to meet its stated objectives for a period of at least two years.

The use of joint venture funding or share placements will be considered by the Directors where it is appropriate to accelerate exploration of a specific project towards the delineation or development of a discovery.

It is also possible that future acquisitions may exceed the current or projected financial resources of the Company and it is expected that these acquisitions would be funded by project finance and/or equity issues (subject to Shareholder approvals if required).

1.5 capital structure Following completion of the Issue, the proposed issued capital structure of the Company, will be as set out in the table below:

minimum suBscription

full suBscription

maximum suBscription

numBer % holDing numBer % holDing numBer % holDing

shares

Total Existing Shares on Issue at Prospectus Date

15,500,000 34.7 15,500,000 28.4 15,500,000 24.1

Vendor Shares 9,125,000 20.5 9,125,000 16.7 9,125,000 14.0

Public Shares 20,000,000 44.8 30,000,000 54.9 40,000,000 61.9

total shares 44,625,000 100.0 54,625,000 100.0 64,625,000 100.0

options

Options on issue 7,250,000 7,250,000 7,250,000

Broker Options 1,000,000 2,000,000 3,000,000

Vendor Options 5,750,000 5,750,000 5,750,000

total options 14,000,000 15,000,000 16,000,000

Note: Refer to the Investigating Accountant’s Report for further information.

Rights attaching to the Shares are summarised in Section 9.4 of this Prospectus.

Terms and Conditions of the Options are summarised in Section 9.5 of this Prospectus.

Potential investors should be aware that 15,500,000 Shares currently on issue were issued at the following issue prices:(a) 4,000,000 Shares at $0.001;(b) 6,500,000 Shares at $0.01; and(c) 5,000,000 Shares at $0.05.

These Shares were issued at a lower issue price than the Shares offered pursuant to this Prospectus to reflect the increased risk associated with the investment at that time. In particular, these initial investors bore the risk that the Company would not proceed to raise further funds (as it is doing pursuant to this Prospectus) to allow the Company to pursue its objectives as stated in this Prospectus.

1.6 risk factorsInvestment in Shares under this Prospectus should be considered as speculative because of the inherent risks in mineral exploration. There are also inherent risks in the delineation of mineral reserves and in mineral production. A summary of the key risk factors is set out in Section 4 of this Prospectus. Before submitting their Application, potential investors should read this Prospectus in full and consult their professional advisers if they require further information on the risks associated with investing in the Company.


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1.7 application for sharesApplications must be for a minimum of 10,000 Shares ($2,000) and thereafter in multiples of 1,000 Shares ($200) and can only be made by completing the Application Form attached to this Prospectus. The Company reserves the right to reject any Application or to allocate any investor fewer Shares than the number for which the Applicant has applied.

1.8 hoW to applyApplications under the Offer may be made, and will only be accepted, in one of the following forms:

• on the relevant Application Form accompanying this Prospectus; or

• on a paper copy of the relevant electronic Application Form which accompanies the electronic version of this Prospectus, both of which can be found at and can be downloaded from www.dorayminerals.com.au.

Application Forms must be accompanied by a personal cheque or a bank draft, payable in Australian dollars, for an amount equal to the number of Shares for which the Applicant wishes to apply multiplied by the Offer Price of 20 cents per Share. Cheques or bank drafts should be made payable to “Doray Minerals Limited Share Account” and crossed “Not Negotiable”. No brokerage or stamp duty is payable by Applicants. The amount payable on Application will not vary during the period of the Offer.

Applicants should ensure that cleared funds are available at the time the Application is lodged, as dishonoured cheques will result in the Application being rejected. Application monies will be held in trust in a subscription account established and controlled by the Company until the allotment of Shares has taken place.

Completed Application Forms should be delivered or posted to:

Doray Minerals Limited Share Issue c/o Computershare Investor Services Pty Ltd GPO Box D182 PERTH WA 6840

Application Forms must be received at the above address by no later than 5.00pm (WST) on the Closing Date.

Detailed instructions on how to complete paper Application Forms are set out on the reverse of those forms. Applicants are not required to sign the Application Form. The Company reserves the right to reject any Application (including where an Application Form has not been correctly completed) or allocate any person fewer Shares than that person applied for, or vary the dates and times of the Offer without prior notice and independently of other parts of the Offer. Where Applications are rejected or fewer Shares are allotted than applied for, surplus Application Money will be refunded. No interest will be paid on any Application Money refunded.

1.9 allocation anD allotment of shares Subject to ASX granting approval for quotation of the Shares, the allotment of Shares will occur as soon as practicable after the Offer closes. All Shares issued pursuant to the Offer will rank pari passu in all respects with the existing Shares of the Company. Holding statements will be dispatched as required by ASX. It is the responsibility of Applicants to determine their allocation prior to trading in Shares.

The Directors reserve the right to reject any Application or to allot a lesser number of Shares than subscribed for in an Application Form. If the number of Shares allocated is less than that applied for, or no allotment is made, the surplus Application Money will be promptly refunded to the Applicant without interest.

1.10 sponsoring BrokerShaw Stockbroking Limited has agreed to act as Sponsoring Broker to the Offer. Details of the terms of appointment of the Sponsoring Broker, including fees payable, are set out in Section 8.2 of this Prospectus.

1.11 Brokerage anD hanDling feesBrokerage and/or handling fees on Applications will be payable by the Company to member firms of ASX or licensed investment advisers on such Application Forms bearing their stamp and accepted by the Company.

1.12 stock exchange listingApplication will be made to ASX within seven days after the date of this Prospectus for Quotation of the Shares issued pursuant to this Prospectus. If approval for Quotation of the Shares is not granted within 3 months after the date of this Prospectus, or such longer period as is permitted by the Corporations Act, all applications will be dealt with in accordance with the Corporations Act.


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1.13 chessThe Company participates in the Clearing House Electronic Subregister System (“CHESS”), operated by ASX Settlement and Transfer Corporation Pty Ltd (“ASTC”), a wholly owned subsidiary of ASX, in accordance with the Listing Rules and ASTC Settlement Rules.

Under this system, the Company will not issue certificates to investors in relation to their Shares. Instead, Shareholders will receive a statement of their shareholdings in the Company.

If an investor is broker sponsored, ASTC will send them CHESS statements. The CHESS statements will set out the number of Shares allotted to each investor under this Prospectus, give details of the Shareholder’s holder identification number (“HIN”) and give the participant identification number of the sponsor.

Alternatively, if an investor is registered on the issuer sponsored sub register, the statements will be dispatched by the Share Registrar and will contain the number of Shares allotted under this Prospectus and the Shareholder’s security holder reference number (“SRN”).

A CHESS statement or issuer sponsored statement will routinely be sent to Shareholders at the end of any calendar month during which the balance of their holding changes. A Shareholder may request a statement at any other time, however a charge may be made for additional statements.

1.14 overseas investors This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. Lodgement of a duly completed Application Form will be taken by the Company as constituting a representation that there has been no breach of such laws.

No action has been taken to register or qualify the Shares, or the Offer, or otherwise to permit a public offering of the Shares, in any jurisdiction outside Australia.

The Offer pursuant to an electronic Prospectus is only available to persons receiving an electronic version of this Prospectus within Australia.

1.15 privacy actThe Company collects information about each Applicant from the Application Form for the purposes of processing the Application and, if the Application is successful, to administer the Applicant’s shareholding in the Company.

By submitting an Application Form, each Applicant agrees that the Company may use the information in the Application Form for the purposes set out in this Prospectus and may disclose it for those purposes to the Share Registrar, the Company’s related bodies corporate, agents, contractors and third party service providers (including mailing houses), ASX, ASIC and other regulatory authorities.

If an Applicant becomes a Shareholder of the Company, the Corporations Act requires the Company to include information about the Shareholder (name, address and details of the Shares held) in its public registers. This information must remain in the registers even if that person ceases to be a Shareholder of the Company. Information contained in the Company’s registers is also used to facilitate distribution payments and corporate communications (including the Company’s financial results, annual reports and other information that the Company may wish to communicate to its Shareholders) and compliance by the Company with legal and regulatory requirements. Successful Applicants may request access to their personal information held by (or on behalf of) the Company by telephoning or writing to the Company Secretary.

If you do not provide the information required on the Application Form, the Company may not be able to accept or process your Application.

1.16 no unDerWritingThe Offer is not underwritten.

1.17 taxationThe Australian taxation consequences of any investment in Shares will depend upon an investor’s particular circumstances. It is an obligation of investors to make their own enquiries concerning the taxation consequences of an investment in the Company. If you are in doubt as to the course of action you should take, you should consult your professional advisers.

To the maximum extent permitted by law, the Company, its officers and each of their respective advisors accept no liability or responsibility with respect to the taxation consequences of subscribing for Shares under this Prospectus.


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1.18 DiviDenD policyThe Company does not yet have a dividend policy. The Company has no immediate intention to declare or distribute dividends. Payment of future dividends will depend upon the future profitability and financial position of the Company.

1.19 financial forecastsThe Directors have considered the matters set out in ASIC Regulatory Guide 170 and believe that they do not have a reasonable basis to forecast future earnings on the basis that the operations of the Company are inherently uncertain. Accordingly, any forecast or projection information would contain such a broad range of potential outcomes and possibilities that it is not possible to prepare a reliable best estimate forecast or projection.

1.20 investor enquiriesThis document is important and should be read in its entirety. Persons in doubt as to the course of action to be followed should consult their stockbroker, solicitor, accountant or other professional adviser without delay.

Additional copies of this Prospectus or further advice on how to complete the Application Form can be obtained from the Share Registrar by telephone on 1300 557 010.

Questions relating to the Offer can be directed to the Company by telephone on +61 (0)8 6468 0388.


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2. overview of the company and projects

2.1 introDuctionDoray Minerals Limited (“Doray” or the “Company”) is a dedicated mineral explorer formed in August 2009 for the purpose of acquiring and developing highly prospective mineral properties.

The Company is currently focussed on exploring for large economic gold deposits in Western and South Australia and has assembled a quality portfolio of strategic exploration properties in anticipation of an improving gold market.

2.2 company oBJectives anD strategyThe Company’s strategy is to use its considerable exploration experience to identify, acquire and develop projects in areas of major gold endowment with the potential to host significant gold deposits. On behalf of its shareholders, Doray is aiming to both capitalise on improved sentiment in the global gold market through the re-evaluation of areas previously identified during less favourable gold market conditions and to expand out from known areas to seek new gold discoveries with the aim of increasing shareholder wealth.

All potential commercialisation options for the Company’s assets will be considered with the ultimate aim of creating and maximising shareholder value.

2.3 exploration proJectsThe initial focus for the Company is on two of Australia’s potentially most attractive but under explored gold provinces: the Murchison Region of Western Australia; and the Central Gawler Gold Province of South Australia. Historically, shallow surficial cover which masks the prospective bedrock geology in these areas has hindered explorers and prospectors. The latest technology and exploration techniques to overcome this hurdle will be utilised so these areas can be explored effectively.


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The Board has identified a number of prospects for immediate drill testing, along with a pipeline of exciting earlier stage opportunities that will be evaluated systematically.

project interest area sq. km

Western australia

Meekatharra North 80% 87

Abbotts 80% 213

Mingah 80% 147

Magnet North 80% 165

Western Queen 80% 160

Lake Magenta 80% 162

south australia

Nuckulla Hill 100% 640

Hicks 100% 150

Kingoonya 49% 147

Harris Bluff 49% 167

total area 2,038 sq km

Doray’s strategy is to secure large areas of highly prospective but ineffectively explored ground along major mineralised structures and test them for high grade and profitable gold deposits.

2.3.1 Western australia proJectsThe Murchison Region is host to numerous large gold deposits with significant previous production and remaining resources. Nearly all of the large gold deposits currently known in the Murchison were discovered through the re-evaluation of areas of historic gold mining activity from the late 1800’s and early 1900’s. Doray believes that the amount of previous exploration outside of these known mining fields in areas of shallow soil cover is limited and that there is potential for new discoveries under these covered areas.

Doray’s Murchison portfolio comprises a number of projects previously explored by Western Mining Corporation (WMC) in the mid to late 1990’s. WMC’s exploration strategy reflected their aim of delineating a near-surface gold deposit larger than any known gold deposit in the region. In most cases, only very widely-spaced first pass (and occasionally follow-up) shallow exploration drilling has been conducted.

Consistent with Doray’s strategy, most of the current project tenements contain significant areas of shallow surficial soil cover which mask the prospective bedrock geology. This cover hindered early prospectors, however with the application of modern exploration techniques the Company believes these areas can be efficiently and cost effectively explored for covered, previously unrecognisable gold deposits.

Although gold ore processing facilities and other infrastructure are established in the district, Doray’s exploration focus is not constrained by the economics of owning this currently under-utilised infrastructure, as was the case for other companies in more recent times. The infrastructure may however potentially provide significant operational benefits in the event of a major new discovery.

meekatharra north

The Meekatharra North Project comprises a number of tenements covering 25km of strike of the Meekatharra Greenstone Belt, east and north of Meekatharra. The project contains a number of gold prospects discovered by WMC in the mid to late 1990’s but which have seen little systematic gold exploration since this time. The most advanced of these prospects is at Andy Well, where several parallel 2km zones of mineralisation are cross cut by northeast trending structures with known gold intersections in shallow drilling but have been only sporadically tested with deeper bedrock drilling.

At Andy Well Doray’s aim is to delineate a significant gold deposit. Upon listing, Doray intends to commence a systematic programme of infill and deeper drilling at Andy Well with the aim to define an oxide and/or primary gold resource. The proposed programme involves initially closing the drill section spacing to 100m or less and ensuring that mineralisation is uniformly tested to at a depth of at least 100m across the prospect area.


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abbotts

The Abbotts Project covers 35km of strike of the highly prospective Abernethy Shear Zone which passes through eastern portion of the Abbotts Greenstone Belt, west of Meekatharra. The project contains a number of historic gold workings and later gold prospects discovered by WMC in the mid-late 1990’s. The Abernethy Shear Zone hosts mineralisation at a number of locations including Viking, Tornado, Airstrip, Abernethy South and Gascoyne Road. The most advanced prospect is at Abernethy South, where a series of sub-horizontal, 2-4m thick zones of supergene gold mineralisation are associated with a mineralised tonalitic intrusive adjacent to the Abernethy Shear Zone. Most previous drilling has been shallower than 100m and none has effectively tested the potential for the bedrock source of the supergene mineralisation. Previous explorers have been unable to determine the orientation and size of the mineralisation. Upon granting of the main Exploration Licence, Doray intends to commence a systematic campaign of infill and deeper drilling focussed on determining the orientation of the main mineralised structures at Abernethy South and defining an oxide and/or primary resource.


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mingah

The Mingah Project covers most of the eastern limb of the Mingah Greenstone Belt, approximately 45km west of Meekatharra. The prospective host rocks are almost completely covered by transported surficial soil cover over the 40km of strike of a major shear zone interpreted from regional aeromagnetic data to most likely represent an extension to the Big Bell Shear Zone.

Previous exploration has been limited to a few widely spaced geochemical RAB and auger sample traverses followed up by similarly spaced first pass vertical aircore drilling with some holes as shallow as 22m and therefore potential remains at depth. Gold anomalism in basalt was associated with anomalous arsenic and a number of holes ended in geochemically anomalous gold.

By comparison, the well-exposed western limb of the Mingah Greenstone Belt adjacent to Doray’s current tenement areas hosts a number of historic gold workings in the Chesterfield project area at Margueritta. There is reason to suspect that, with the added influence of a major shear zone, the eastern limb represents an attractive target on this basis systematic drill testing of this structure is therefore planned.

magnet north

The Magnet North Project comprises two Exploration Licence applications which cover approximately 47km of strike of the Cuddingwarra Shear Zone immediately north of Mt Magnet. The northern half of the project area is covered by Lake Austin and has been subject to only cursory exploration, despite numerous gold occurrences and historic drill intersections such as the “Busload of Faith” and “Lake” prospects.

The southern half of the project has extensive colluvial cover over mafic and ultramafic rocks along with banded iron formation. Gold mineralisation is known at the Blackmans Find prospect, within an excised Mining Lease, along with a number of other prospects all of which are located to the south within Doray’s tenement.

Western queen

The Western Queen Project covers over 35km of strike of the Warda Warra Greenstone Belt, 75km northwest of Mt Magnet. The project area has extensive sufficial soil cover and less than 50% outcrop. Mineralisation has been identified at the high grade Western Queen (160,000oz production) and Western Queen South deposits, within excised mining leases.

Previous exploration has focussed on the areas immediately surrounding the known deposits and, despite this, there remains potential of repetitions of the steep south plunging mineralisation seen at Western Queen and Western Queen South to the north and south within Doray’s surrounding lease.

lake magenta

The Lake Magenta project covers the southern 17km of the mineralised Yandina Shear Zone, 100km west of Ravensthorpe (20km northeast of Jerramungup) in the South Coastal region of WA and is on freehold farm land. Wide-spaced reconnaissance drilling by Dominion Mining Limited identified widespread gold anomalism at a number of prospects along the shear zone, coincident with a linear IP anomaly. The gold anomaly has not been sufficiently explained by bedrock drill testing. Upon granting, Doray will commence a programme of infill and deeper drilling with the aim of defining an economic resource.

2.3.2 central gaWler proJects, south australia

Doray has a number of projects within the Central Gawler Gold Province in South Australia. The projects are located on major mineralised structures along strike from historic and or recently discovered gold mineralisation and in areas where the prospective bedrock is obscured by shallow surficial soil cover. The project areas are also prospective for palaeochannel-hosted uranium mineralisation and iron oxide copper gold (IOCG) deposits.

The Central Gawler Gold Province is an arcuate belt of Proterozoic gold prospects, deposits and historic workings that hug the western and southern margin of the Gawler Range Volcanics (GRV) in central South Australia. The Province is associated with intrusion of Mesoproterozoic Hiltaba suite granitoids similar to those that host the well-known iron oxide copper-gold deposits in the region, but with a more reduced geochemistry resulting in pyrite-gold mineralisation rather than haematite associated mineralisation (Ferris and Schwarz, 2003) 1.

1. Ferris, G., and Schwarz, M., 2003. Proterozoic Gold Province of the Central Gawler Craton. MESA Journal 30.


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nuckulla hill

The Nuckulla Hill gold-silver project is located within the Yarlbrinda Shear Zone, approximately 50km south of the

Tunkillia deposit. The project covers 50km of strike of the shear zone, however less than 25% has been effectively

explored for gold and only minor systematic gold exploration work has been completed since the late 1990’s. Prospects

identified by previous explorers through calcrete geochemical sampling and subsequent shallow regolith drilling have

in most cases not been followed up with deeper drilling, with the exception of Myall, Bimba and Sheoak which contain

significant gold mineralisation open at depth and along strike to the north and south.


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Doray intends to re-examine existing aeromagnetic survey data, conduct similarly detailed surveys north and south of the existing survey with a view to defining other structural targets along the shear zone and conduct infill and deeper drilling of these targets.

hicks

The Hicks prospect is located within the Labyrinth Shear Zone roughly halfway between Kingoonya and Tarcoola. Previous explorers defined a discrete calcrete gold geochemical anomaly along strike from historic workings at Lake Labyrinth to the northwest and another gold prospect, KIN27, to the southeast. Initial drill testing of the anomaly returned some encouraging gold results in the bedrock at the end of a number of holes and a 150m wide zone of gold anomalism has been identified which is yet to be followed up.

kingoonya

The Kingoonya project is located within the Labyrinth Shear Zone halfway between Glendambo and Kingoonya and is characterised by significant calcrete gold geochemical anomalies that have not been explained. Limited shallow drilling by previous explorers in most cases failed to reach bedrock. More recently, a soil survey was conducted with samples collected on north-south traverses analysed by the “Enzyme Leach” technique. Analysis of the results of this survey indicate the presence of west-northwest-trending structures coincident with calcrete gold anomalism and linear features interpreted from regional aeromagnetic data. Joint venture partner Mega Hindmarsh Pty Ltd is also exploring for palaeochannel-related uranium mineralisation within the project area.

harris Bluff

The Harris Bluff project is located on the Southern Margin of the Gawler Range Volcanics, 35km west of Iron Knob in South Australia. Within the project area, Palaeoproterozoic Gneisses and granitoids of the Lincoln Complex are overlain by upper Gawler Range Volcanics and associated Corunna Conglomerate, which are locally intruded by the important Hiltaba Suite granitoids. The area is prospective for epithermal gold-silver, such as seen at nearby Parkinson Dam, and Menninnie Dam-style Ag-Pb-Zn mineralisation. Joint venture partner Mega Hindmarsh Pty Ltd is also exploring for unconformity-related uranium mineralisation within the project area.


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2.4 exploration programme anD BuDgetFollowing listing, Doray intends to commence a systematic drilling campaign with the aim of defining a resource at the Andy Well prospect as soon as possible. At the same time, the Company intends to undertake work to validate and confirm previous work over the Granite Well prospect within the Abbotts project.

In South Australia, Doray intends to compile all previous data for the Nuckulla Hill project including re-examination of the detailed aeromagnetic data flown previously. Following this, the Company will commission collection of similar data over the remaining 50% of the strike length of the Yarlbrinda Shear Zone followed by a structural interpretation of the combined data in order to generate drill targets for testing.

The proposed budget for granted tenure for the first two years is set out in the following table.

project$4m raising $6m raising $8m raising

year 1 year 2 year 1 year 2 year 1 year 2

Western australia

Meekatharra North 900,000 900,000 1,250,000 1,250,000 1,750,000 1,750,000

Abbotts 15,000 15,000 15,000 15,000 25,000 25,000

south australia

Nuckulla Hill 85,000 85,000 250,000 250,000 250,000 250,000

total 1,000,000 1,000,000 1,515,000 1,515,000 2,025,000 2,025,000

two year total 2,000,000 3,030,000 4,050,000

2.5 competent personThe information in this section of the Prospectus that relates to Exploration Results, Mineral Resources, or Ore Reserves is based on information compiled by Heath Hellewell. Mr Hellewell has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, and is a member of the Australian Institute of Geoscientists. This qualifies Mr Hellewell as a Competent Person as defined in the 2004 edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Hellewell consents to the inclusion of information in this section of the Prospectus based on his information in the form and context in which it appears.


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3. Directors and management Doray’s Board combines extensive mineral project exploration and development experience for a range of commodities world-wide with experience in managing private and public companies across several industry sectors.

non-executive chairman Brett fraser B.Bus, FCPA, FFin

Brett is a Certified Practising Accountant with in excess of 25 years experience in the finance and securities industry. Brett has experience across the resource, finance, media, brewing, wine and health sectors. He has owned business enterprises or held director and senior management positions in these industries. Currently Brett is the Chairman of Drake Resources Limited, Aura Energy Limited and Blina Diamonds NL.

managing Director allan kelly BSc (Hons), Grad Cert Bus, FAAG

Allan has over 16 years experience in mineral exploration geology, geochemistry and project management throughout Australia and the Americas and previously held senior exploration positions with WMC and Avoca Resources from its inception in 2002.

Allan was directly involved in the targeting and early stage exploration of the Gunbarrel and Collurabbie nickel projects for WMC and the Port Julia, Glensea and Churchill Dam iron-oxide Cu-Au projects as well as a number of gold properties in Australia, Alaska and Canada.

Allan is a Fellow and former Councillor of the Association of Applied Geochemistry.

technical Director heath hellewell BSc(Hons), MAIG

Heath has over 16 years experience in mineral exploration geology and project management in Australia, Africa, Philippines and Scandinavia including positions with De Beers and Resolute Limited before joining Independence Group NL in 2000. Heath was part of the team at Independence prior to its initial public offering and was part of the exploration team that identified and pegged the Tropicana area, leading to the discovery of the Tropicana Gold Deposit. Heath rose to the position of Exploration Manager at Independence Group and more recently has been Exploration Manager at Goldsearch Limited.

non executive Director/company secretary

Jay stephenson MBA, FCPA, CMA, FCIS, MAICD

Jay has been involved in business development for over 20 years including approximately 16 years as Director, Chief Financial Officer and Company Secretary for various listed and unlisted entities in resources, manufacturing, wine, hotels and property. He has been involved in business acquisitions, mergers, initial public offerings, capital raisings, business restructuring as well managing all areas of finance for companies.

Jay is currently a non-executive Director of Drake Resources Limited, Strategic Minerals Corporation NL, Atom Energy Limited and Aura Energy Limited as well as Company Secretary for a number of ASX listed resource and industrial companies.


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4. risk factors

4.1 introDuctionThe Shares offered under this Prospectus should be considered speculative because of the nature of the commercial activities of the Company. Whilst the Directors recommend the Offer, potential investors should be aware that an investment in the Company involves risks, which may be higher than the risks associated with an investment in other companies.

There are numerous widespread risks associated with investing in any form of business and with investing in the share market generally. There is also a range of specific risks associated with the Company’s activities and its involvement in the exploration industry. These risk factors are largely beyond the control of the Company and its Directors because of the nature of the proposed activities of the Company.

Persons considering whether or not to invest in the Company should read the whole of this Prospectus in order to fully appreciate such matters and the manner in which the Company intends to operate, before any decision is made to apply for Shares. Prospective investors should consider whether the Shares offered are a suitable investment for them having regard to their own personal investment objectives and financial circumstances and the risk factors set out below. If in any doubt, they should consult with their professional advisers before deciding whether to apply for Shares.

The following, which is not exhaustive, identifies some of the major risks associated with an investment in the Company, of which potential investors need to be aware before making a decision on whether or not to invest in the Shares.

4.2 general General risks associated with investment in the Company may include:

• fluctuation of the price at which the Shares trade due to market factors;

• price volatility of the Shares in response to factors such as:

• additions or departures of key personnel;

• litigation and legislative change;

• press newspaper or other media reports; and

• actual or anticipated variations in the Company’s operating results.

4.3 explorationExploration is inherently associated with risk. Notwithstanding the experience, knowledge and careful evaluation a company brings to an exploration project there is no assurance that recoverable mineral resources will be identified. Even if identified, other factors such as technical difficulties, geological conditions, adverse changes in government policy or legislation or lack of access to sufficient funding may mean that the resource is not economically recoverable or may otherwise preclude the Company from successfully exploiting the resource.

4.4 Development anD miningPossible future development of mining operations at any of the Company’s projects is also subject to numerous risks. The Company’s operations may be delayed or prevented as a result of weather conditions, mechanical difficulties, shortage of technical expertise or equipment. There may be difficulties with obtaining government and/or third party approvals, operational difficulties encountered with extraction and production activities, unexpected shortages or increase in the price of consumables, plant and equipment, cost overruns or lack of access to required levels of funding.

If the Company commences production, its operations may be curtailed or disrupted by a number of risks beyond its control such as environmental hazards, industrial accidents and disputes, technical failures, unusual or unexpected geological conditions, adverse weather conditions, fires, explosions and other accidents.

The Company’s operations may be adversely affected by higher than anticipated ore treatment costs, worse than anticipated metallurgical conditions, fluctuations in metal prices or lack of availability of smelter capacity.

No assurance can be given that the Company will achieve commercial viability through development of any of its projects.

4.5 limiteD operating experience anD reliance on key personnelWhile its Directors and management team have significant experience in the mining exploration industry, the Company has only very limited operating experience. If growth objectives are to be met, this will depend on the ability of the Directors and management to implement the current exploration strategies and to adapt, where necessary, to accommodate and manage any unforeseen difficulties. Initially, the Company will rely heavily on the experience of its existing management team and Directors. The loss of the services of certain personnel could have an adverse effect on the Company and its activities.


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4.6 resource estimations

The exploration costs of the Company described in the Independent Geologist’s Report are based on certain assumptions with respect to the method and timing of exploration. Resource estimates are inherently imprecise as they are expressions of judgement at a particular time based on available information, interpreted using experience and resource modelling techniques. The estimates, while made by qualified professionals, may change over time as other information becomes available which differs from information known or predicted by past drilling, sampling and geological interpretation. Estimates remain subject to change and no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the Company’s viability.

4.7 commoDity anD currency price volatility

Commodity prices are subject to influencing factors beyond the control of the Company and can be subject to significant fluctuations. Just some of these influencing factors include:

• world demand for particular commodities

• the level of production costs in major commodity producing regions

• expectations regarding inflation, interest rates and US dollar exchange rates.

Any significant and/or sustained fluctuation in exchange rates or commodity prices could have a materially adverse affect on the Company’s operations and its financial position.

4.8 native title anD aBoriginal heritage

The Native Title Act 1993 (Cth) recognises certain rights of indigenous Australians over land where those rights have not been extinguished. These rights, where they exist, may impact on the ability of the Company to carry out exploration or obtain production Tenements. In applying for certain production Tenements, the Company must observe the provisions of Native Title legislation (where applicable) and Aboriginal Heritage legislation which protects Aboriginal sites and objects of significance.

In certain circumstances the consent of registered Native Title claimants must be obtained prior to carrying out certain activities on land to which their claim relates. It is possible that the conditions imposed by Native Title claimants on such consent may be on terms unacceptable to the Company.

4.9 tenure anD access

Mining and exploration tenements are subject to periodic renewal. There is no guarantee that current or future tenements or current or future applications for production tenements will be approved.

Tenements are subject to numerous State-specific legislation conditions. The renewal of the term of a granted tenement is also subject to the discretion of the relevant Minister. Renewal conditions may include increased expenditure and work commitments or compulsory relinquishment of areas of the tenements. The imposition of new conditions or the inability to meet those conditions may adversely affect the operations, financial position and/or performance of the Company.

4.10 compulsory Work oBligations

Tenements are subject to expenditure and work commitments which must be met in order to keep such tenements in good standing. These commitments may be varied on application by the tenement holder but any such variation is at the sole discretion of the Minister administering the relevant State mining legislation. If no variation is approved, and there is failure to meet the commitments, this could lead to forfeiture of the tenement.

4.11 environmental

The Project is subject to both the relevant State and also Commonwealth laws and regulations relating to environmental matters. Should the Company proceed to development of one or more mines, it could be expected that such developments would have numerous environmental impacts which would require various statutory approvals to be put in place. There is no guarantee that such approvals would be granted. The Company intends to conduct its operations in an environmentally responsible manner and in accordance with relevant legislation. However, the Company is unable to predict the effect of future changes to environmental legislation or policy and the cost effect of such changes on its operations and financial position.


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4.12 shortage of funDingThe funds raised by the Offer will be used to carry out work on the Company’s projects as detailed in this Prospectus. If the Company incurs unexpected costs or is unable to generate sufficient operating income, further funding may be required. The Company may require additional funding to carry out further exploration, undertake feasibility studies, develop mining operations and/or acquire new projects. Any additional financing through share issues may dilute shareholdings acquired under this Prospectus. Debt financing may not be available to support the scope and extent of proposed developments. If available, it may impose restrictions on operating activities or anticipated expansion of the Company’s operations.

4.13 Joint venturesThe Company undertakes a number of its projects and may wish to undertake future projects through joint venture arrangements. Any joint ventures entered into by, or interests in joint ventures assigned to, the Company could be affected by the failure or default of any of the joint venture participants.

4.14 uraniumThe Company’s South Australian Projects involve exploration for uranium. Nuclear energy is in direct competition with other more conventional sources of energy, which include gas, coal and hydro-electricity.

Furthermore, any potential growth of the nuclear power industry (with any potential attendant increase in the demand for uranium) beyond its current level will depend on continued and increased acceptance of nuclear technology as a means of generating electricity. The nuclear industry is currently subject to some negative public opinion owing to political, technological and environmental factors. This may have an adverse impact on the demand for uranium and increase the regulation of uranium mining.

One of the arguments in favour of nuclear energy is its lower emissions of carbon dioxide per unit of power generated compared to coal and gas. Alternative energy systems such as wind or solar also have no or very low carbon emissions. However, to date these have not been cost-effective enough to be used for large scale base load power. Technology changes may occur that make alternative energy systems more efficient, reliable or cost-effective.

In addition, to the competition of energy sources, Uranium mining is subject to extensive regulation by State and Federal governments in relation to exploration, development, production, exports, taxes and royalties, labour standards, occupational health, waste disposal, protection and rehabilitation of the environment, mine reclamation, mine safety, toxic and radioactive substances, native title and other matters. Compliance with such laws and regulations will increase the time to obtain necessary regulatory approvals and increase costs of exploring, drilling, developing, constructing, operating and closing mines and other production facilities. There is also a risk that new rules and regulations are applied in a manner which could limit or curtail future production or development.

Uranium mining in South Australia is permitted but is subject to stricter control than is mining in general due to concerns about the potential uses and physical characteristics of the end product and the need to comply with Commonwealth legislation, codes, international treaties, conventions and agreements. The South Australian State Government allows the mining of uranium provided strict conditions are adhered to relating to the transport of uranium, spillage, control of radiation and radioactive material and having an approved radiation management program and radioactive waste management program in place and establishing an environmental management and monitoring plan for the protection, management and rehabilitation of the environment.

The Federal Government currently permits the mining and export of uranium under strict international agreements designed to prevent nuclear proliferation. The export of uranium is tightly controlled by the Federal Government through its licensing process and Australian uranium can only be exported to those countries which undertake to use it for peaceful purposes. The Federal Government cannot override State Government policy on this issue.


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5. independent geologist’s report

5(a) Western australian proJects

Malcolm Castle Consulting Geologist

P.O. Box 473, South Perth, WA 6951 Phone: 08 9474 9351

Mobile: 04 1234 7511 Email: [email protected]

ABN: 84 274 218 871

27 October 2009 The Directors Doray Minerals Limited Dear Sirs, Re:

INDEPENDENT GEOLOGIST’S REPORT ON GOLD PROPERTIES in WESTERN AUSTRALIA

I have been commissioned by Doray Minerals Limited (ACN 138 978 631) (“Doray” or the “Company”) to provide an independent technical report on the Company’s projects in Western Australia. This report is to be included in a Prospectus to be lodged by the Company with the Australian Securities and Investments Commission (“ASIC”),offering for subscription 30,000,000 Shares at an issue price of 20 cents each to raise $6,000,000. The funds raised will be used for the purpose of exploration and evaluation of the mineral properties held by The Company. The Properties The Meekatharra North Project consists of a number of tenements in the Meekatharra Greenstone Belt, east and north of Meekatharra. Previous work discovered a number of parallel 2km long zones of mineralisation at the Wilber, Wendy and Bernie prospects at Andy Well. The Abbotts Project covers approximately 35km of strike of the eastern portion of the Abbotts Greenstone Belt, west of Meekatharra. Previous exploration discovered numerous zones of high grade mineralisation over most of the strike length of the project including the Abernethy South and Gascoyne Road prospects. The Mingah Project covers approximately 40km of strike of the eastern portion of the Mingah/Chesterfield Greenstone belt, 50km west of Meekatharra. The Magnet North project covers approximately 50km of strike of prospective greenstone between the Hill 50 gold mine and the Cuddingwarra gold deposits with a significant portion under Lake Austin.


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The Western Queen Project covers approximately 35km of strike of the Warda Greenstone belt, 75km NW of Mt Magnet. The Project surrounds but does not include two ML’s over the high grade Western Queen and Western Queen South gold deposits but includes the Trixie prospect. The Lake Magenta project in the southern Yilgarn region covers the southern 17km of the mineralised Yandina Shear Zone, 100km west of Ravensthorpe. Recent reconnaissance drilling identified widespread gold anomalism. Details in respect to the legal status and tenure of the tenements comprising the Projects have not been considered in this report but are outlined in the Independent Solicitors Report in Section 7 of the Prospectus. DECLARATIONS Relevant codes and guidelines This report has been prepared as a technical assessment in accordance with the Code for Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports (the “VALMIN Code”), which is binding upon Members of the Australasian Institute of Mining and Metallurgy (“AusIMM”) and the Australian Institute of Geoscientists (“AIG”), as well as the rules and guidelines issued by the Australian Securities and Investments Commission (“ASIC”) and the ASX Limited (“ASX”) which pertain to Independent Expert Reports (Regulatory Guides RG111 and RG112). Where mineral resources have been referred to in this report, the classifications are consistent with the ”Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (“JORC Code”), prepared by the Joint Ore Reserves Committee of the AusIMM, the AIG and the Minerals Council of Australia, effective December 2004. Under the definition provided by the ASX and in the VALMIN Code, these properties are classified as ‘exploration projects’, which are inherently speculative in nature. The properties are considered to be sufficiently prospective, subject to varying degrees of risk, to warrant further exploration and development of their economic potential, consistent with the exploration and development programs proposed by the Company. Sources of Information The statements and opinion contained in this report are given in good faith and this review is based on information provided by the title holders, along with technical reports prepared by consultants, previous tenements holders and other relevant published and unpublished data for the area. I have endeavoured, by making all reasonable enquiries, to confirm the authenticity, accuracy and completeness of the technical data upon which this report is based. A final draft of this report was provided to the Company along with a written request to identify any material errors or omissions prior to lodgement. The independent technical report has been compiled based on information available up to and including the date of this report. Consent has been given for the distribution of this report in the form and context in which it appears. I have no reason to doubt the authenticity or substance of the information provided.


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Qualifications and Experience The person responsible for the preparation of this report is: Malcolm Castle, B.Sc.(Hons), GCertAppFin (Sec Inst), MAusIMM.

Malcolm Castle has over 40 years experience in exploration geology and property evaluation, working for major companies for 20 years as an exploration geologist. He established a consulting company 20 years ago and specializes in exploration management, technical audit, due diligence and property valuation at all stages of development. He has wide experience in a number of commodities including gold, base metals, iron ore and mineral sands. He has been responsible for project discovery through to feasibility study in Australia, Fiji, Southern Africa and Indonesia and technical Audits in many countries. Mr Castle completed studies in Applied Geology with the University of New South Wales in 1965 and has been awarded a B.Sc (Hons) degree. He has completed postgraduate studies with the Securities Institute of Australia in 2001 and has been awarded a Graduate Certificate in Applied Finance and Investment in 2004. Mr Castle is a Member of the Australasian Institute of Mining and Metallurgy (“AusIMM”) and has the appropriate relevant qualifications, experience, competence and independence to be considered as an “Expert” and “Competent Person” the Australian Valmin and JORC Codes, respectively.

Independence I am not, nor intend to be a director, officer or other direct employee of the Company and have no material interest in the Projects or the Company. The relationship with the Company is solely one of professional association between client and independent consultant. The review work and this report are prepared in return for professional fees based upon agreed commercial rates and the payment of these fees is in no way contingent on the results of this Report. Yours faithfully

Malcolm Castle B.Sc.(Hons), MAusIMM, GCertAppFin (Sec Inst)


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27

1the murchison region proJects1

regional setting

The Murchison Province is the westernmost of three sub-provinces of the Archean Yilgarn Craton in Western Australia and covers an area of approximately 95,000km2, of which less than 5% of geology is outcropping . The regional geology is dominated by granite-greenstone terrain with a number of north and north-east trending greenstone belts of mafic, felsic, ultramafic and sedimentary rocks of the Murchison Supergroup. These greenstone belts are intruded by later “internal granitioids” and cross-cut by a series of major crustal-district scale structures which host much of the gold and other mineral deposits in the region.

The main populated areas in the region are the towns of Mt Magnet, Cue and Meekatharra, all located along the Great Northern Highway, which bisects the region and provides good all-weather access to most of Doray’s projects.

Mineralisation Styles

Gold mineralisation is epigenetic, intimately associated with major faults and shear zones and hosted in a range of rock types including mafic and felsic volcanics and intrusives, sediments, including Banded Iron Formation, and ultramafic rocks. The Murchison is the second-most important gold mining region in Western Australia, in terms of production, after the Eastern Goldfields. The north eastern Murchison has produced significantly more gold than the south western portion, even when the proportionately larger area of greenstone is taken into account.

Previous production at the major gold deposits in the Murchison include:

• Big Bell – 2.9 Moz

• Meekatharra/Paddys Flat – 3 Moz

• Bluebird – 3 Moz

• Hill 50 – 2 Moz

• Tuckabianna – 1 Moz

• Day Dawn – 1 Moz

• Cuddingwarra – 1 Moz

Apart from these larger deposits, there are number of smaller high-grade deposits and prospects in the Murchison region.

Exploration for other commodities has been relatively minor, but significant base metal and iron ore deposits also exist within the Murchison region, such as Golden Grove and Mt Gibson respectively.

meekatharra north proJect

The Meekatharra North project includes two granted Exploration Licences and five granted Prospecting Licences with a total area of 87 km2 in the Meekatharra Greenstone Belt north of Meekatharra, WA. The Meekatharra North project is located immediately east and north of Meekatharra adjacent to the Great Northern Highway.

tenement grant Date expiry Date area (km2)

E51/1217 22 Jan 2008 21 Jan 2013 63.00

E51/1218 22 Jan 2008 21 Jan 2013 15.00

P51/2573 21 May 2009 20 May 2013 1.92

P51/2574 21 May 2009 20 May 2013 1.83

P51/2575 21 May 2009 20 May 2013 1.72

P51/2576 21 May 2009 20 May 2013 1.82

P51/2577 21 May 2009 20 May 2013 1.59

Topography is generally flat and access is therefore good via the Great Northern Highway and station tracks. Vegetation consists of open mulga woodland and some Spinifex grass along with numerous alluvial channels and areas of sheetwash.

The regional geology of the area consists of rocks of the Archaean Luke Creek Group and overlying Mt Farmer Formation. To the north of the project area, the younger Proterozoic rocks onlap the northern edge of the Yilgarn Craton.


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Geological Setting

The project area as a whole covers poorly exposed portions of the north northeasterly trending Archaean Meekatharra-Wydgee Greenstone Belt, comprising a succession of metamorphosed mafic to ultramafic and felsic and sedimentary rocks belonging to the Luke Creek and Mount Farmer Groups.

Over the northern extensions of the belt, sediments belonging to the Proterozoic Yerrida Basin unconformably overlie Archaean granite-greenstone terrain. Structurally, the belt takes the form of a syncline known as the Polelle syncline. Younger Archaean granitoids have intrusive contacts with the greenstone succession and have intersected several zones particularly in the Side Well area.

The project covers approximately 25km of strike of greenstone belt consisting of metamorphosed mafic and sedimentary rocks intruded by later felsic, mafic and ultramafic rocks. The project area is within the regional “Pollel Synform” and exhibits upper-greenschist facies regional metamorphism. Outcrop is very limited within the project area as a result of extensive lateritisation and later alluvial and sheetwash deposits.

In the Andy Well area, a largely concealed portion of the north northeasterly trending Greenstone Belt is defined, on the basis of drilling and airborne magnetic data, to underlie the area over a maximum strike distance of some 15 kilometres and a width of up to 4 kilometres. At surface this area includes subcrops of weathered schistose sedimentary and felsic rocks including quartz-sericite schist cut by quartz veins and metamorphosed porphyry. Narrow northerly trending and steeply dipping Banded Iron Formation also crops out.

Superficial cover includes degraded laterite profiles and ferruginised rubble and colluvium over areas of subdued relief which grade in to sheetwash deposits 5 to 8 metres thick and alluvium in surrounding watercourses related to northwesterly flowing tributaries to the Yalgar drainage system. Alluvial cover over the Yalgar drainage system ranges up to 30 metres thick overlying channel clays up to 100 metres thick.

The greenstone succession is tightly folded into a south plunging syncline and is cut by easterly trending Proterozoic dolerite dykes.

There is no rock exposure at the Side Well prospect. This area is covered by alluvium and lacustrine clays commonly up to 60 metres thick. Interpretation of exploration drilling and magnetic data imply that the area is underlain by a portion of the Meekatharra-Wydgee Greenstone Belt.

Mineralisation

In general, the lower mafic to ultramafic units of the Meekatharra-Wydgee Greenstone Belt succession have historically proved to be the most prospective for gold mineralisation. Mineralisation consists of quartz-sericite-biotite-feldspar-sulphide mineral assemblages with pyrite being the main sulphide mineral.

Gold mineralisation exists within the project area at a number of prospects within a range of host rock lithologies including ultramafic, mafic and felsic porphyry. Typical alteration assemblages associated with mineralisation are quartz-sericite-biotite-feldspar-sulphide with pyrite the predominant sulphide.

Gold mineralisation at Andy Well is associated with both brittle and ductile deformation sites and associated with ultramafic and felsic porphyry and altered mafic schist.


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Generalised geology for Meekatharra North Project area.


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Project History and Previous Exploration

Extensive work programs were carried out by previous explorers over the Meekatharra North area including ultra-detailed 50m line-spaced aeromagnetic survey; Geological and regolith mapping; Lag and soil sampling and RAB, RC, aircore and limited diamond core drilling. This exploration resulted in the discovery of mineralisation at a number of prospects, including, Wilber, Wendy, Sandra and Bernie. Significant drill intersections included the following results.

prospect hole from to interval grade (g/t)

Sandra MEKC294 22 34 12 1.01

MEKC295 54 56 2 0.79

MEKC295 60 62 2 1.10

Wilber MEKC62 86 88 2 7.10

MEKD285 106.55 107 0.45 24.00

MEKC63 52 68 6 2.18

MEKC63 82 92 10 7.20

MEKC7 44 48 4 7.72

MEKI125 32 64 32 0.26

MEKI131 36 55 19 2.86

including 40 44 4 9.20

Wendy MEKC19 104 106 2 5.90

MEKC27 78 104 26 0.69

MEKC51 34 36 2 0.71

MEKC44 26 28 2 1.01

Bernie MEKC14 20 22 2 1.00

MEKC14 34 40 6 0.82

A further limited program of 26 RC holes at Andy Well in 2000 was completed and the highest results of [email protected]/t (MNC19) and [email protected]/t (MNC23) at Wilber, which confirmed the intersection in the earlier MEKI131; and [email protected]/t EOH (MNC6) at Wendy, which extends the strike length of the mineralised zone at Wendy to 500m. Other holes in the program returned lower values of less than 0.5 g/t gold. Limited ground magnetic traverses were also completed.


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Andy Well prospect showing interpreted mineralised zones with existing drilling and number of holes >100m depth

(larger dots).


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Prospectivity and Proposed Future Work

The tenements of the Meekatharra North area represent those parts found to cover concealed gold mineralisation or to exhibit geochemical gold anomalism following extensive regolith drilling over the northern portion of the Meekatharra-Wydgee Greenstone Belt. Previous exploration has been aided by detailed airborne magnetic data but the lack of rock exposure and extensive transported cover has meant that exploration has largely been reliant upon successive phases of regolith drilling to identify the targets of interest. This process of prospect discovery has now been broadly achieved. The next phase of exploration needs to focus in more detail on the prospects themselves and in particular to obtain a better understanding of the structural controls and orientation of the known mineralisation.

The most advanced prospect is the Wilber prospect at Andy Well, where previous drilling has defined a zone of regolith and bedrock mineralisation over almost 2km of strike and 200m wide. Other holes in the program returned lower results with less that 1 g/t gold. The mineralisation occurs in strongly sulphidised quartz-biotite-chlorite altered mafics (MEKC63 et al) and in oxidised felsic porphyry (MEKI131). The prospect is located on the western side of a mineralised felsic porphyry, which along with the mafic sequence hosts the Wendy and Bernie prospects. Structurally this area is at the intersection of the main Meekatharra Shear Zone and a series of interpreted northwest and west northwest structures.

The Wendy prospect is defined by a 1.7km long zone of mineralisation intersected in previous drilling with wider intervals up to 36m hosted in altered mafic rocks adjacent to the mineralised felsic porphyry. Other holes returned lower values on average.

The southern 50% of the prospects at Andy Well have not been effectively tested, with holes as shallow as 10-15m depth being the only previous drilling completed. In fact, only about 12% of all holes drilled at the Wilber prospect are deeper than 100m. There exists potential for delineation of a significant gold deposit in the order of a few hundreds of meters in length.

Other prospects requiring follow-up include Sandra and Side Well, all of which have had only cursory first pass follow-up of the original regolith RAB drilling anomalies.

Upon listing, Doray intends to commence a systematic program of infill and deeper drilling at Andy Well with the aim to define an oxide and/or primary gold resource. The program will initially involve closing the drill section spacing to 100m and ensure that mineralisation is uniformly tested to at a depth of at least 100m across the prospect area. This is considered appropriate at the current level of knowledge and encouragement.

The proposed budget proposed by Doray for the first two years will be as follows:

year 1 year 2 total

Drilling 900,000 900,000 1,800,000

Analysis 250,000 250,000 500,000

Geologist 100,000 100,000 200,000

TOTAL 1,250,000 1,250,000 2,500,000

aBBotts proJect

Location and Tenure

The Abbotts Project is located approximately 10km west of Meekatharra and includes two granted Prospecting Licences and one Exploration Licence application with a total area of 213 km2. The tenements cover over 30km of strike of the highly prospective Abernethy Shear Zone within the Abbotts-Cue Greenstone Belt which trends NNE through the project area.

Access to most of the project area is good via the Meekatharra – Gascoyne Junction road and then various station tracks. Vegetation cover is typical for most of the Murchison, low density mulga with underlying seasonal grasses. The southern third of the project area is dominated by a broad alluvial system which masks underlying geology.

The project comprises the following tenements:

tenement status grant Date expiry Date area (km2)

E51/1334 Application 210.00

P51/2578 Granted 7 Sept 2009 6 Sept 2013 1.61

P51/2579 Granted 7 Sept 2009 6 Sept 2013 1.61


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Geological Setting

The Abbotts Greenstone Belt forms an asymmetrical, synformal succession of Archaean komatiitic and tholeitic volcanics with interflow sediments, overlain by felsic volcanics, epiclastic sediments including sulphidic black shales. Differentiated mafic and ultramafic sills intrude the succession. Later east-west trending Proterozoic dykes crosscut the entire Archaean sequence.

The Abbotts tenements cover portions of the southeastern flank of the Abbots Greenstone Belt. This belt is centred 20 kilometres northwest of Meekatharra and is a north trending broadly elliptical structure some 40 kilometres long by up to 20 kilometres wide. Along its southeastern margin, the belt is attenuated in the southwesterly and northeasterly directions by a zone of deformation near the contact with external granitoids, interpreted on the basis of magnetic data to be associated with the regionally significant Abernethy Shear Zone that has been shown by drilling to be associated with gold mineralisation. Several strike slip faults are also present within the stratigraphy and may represent the northern extension of a major structure which passes through the Big Bell deposit.

The project covers almost the entire upper felsic/sediment package in the centre of the synform and the lower mafic/ultramafic sequence on the eastern limb of the folded Abbotts Greenstone Belt. The northeast trending Abernethy Shear Zone sits roughly in the centre of the project area and continues for over 20km within the tenements and provides a sheared bounding contact with granitoids to the east. Mineralisation is seen along most of its length, evidenced by several historic workings at the north east end (excised from the project area) and numerous significant drill intersections by previous explorers as far south as the “Gascoyne Road” prospect, 15km to the southwest.

Mineralisation

Historically, gold occurrence in the Abbotts Greenstone Belt has been associated with quartz veining in metamorphosed sediments, volcaniclastics, komatiitic basalts and peridotites. The majority of the succession is highly cleaved and lineated and several generations of fabric development are recognisable. The southeastern greenstone-granite margin probably represents the surface trace of the Abernethy Shear Zone. Intense rock fabric development and quartz veining associated with tourmaline-green mica alteration represent other individual areas of high structural strain.

Mineralisation within the project area is associated with quartz veins in various rock types including sediments, volcaniclastics, mafics and ultramafics, and has a spatial association with the northeast trending Abernethy Shear Zone which may represent the northern extension of a major structure which passes through the large Big Bell deposit.

Drilling has established that alluvial cover in the southwestern parts of the property is up to 30 metres thick. The areas of transported cover are not clearly delineated from areas of residual cover. This has led to doubts as to the effectiveness of previously completed surface geochemical sampling for drill target definition in some areas.


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General geology of the Abbotts Project showing gold occurrences.


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Exploration prior to 1991 focussed primarily on base metals and included mapping and aerial photo interpretation, surface geochemistry and geophysical surveys followed by drilling of various targets. Some gold exploration was carried out in the excised areas in the northeast, and at least one phase of BLEG sampling was also carried out in the current Doray tenements resulting in a broad anomaly in the area where the Kayak, Laser and Tornado prospects are now located. Follow-up RAB drilling in these areas resulted in anomalous intersections with low order gold values.

From 1991 to 1998, the project area was explored by a broad first-pass lag geochemical sampling program which resulted in the identification of a number of gold anomalies: some were related to historic workings and base metal gossans, which were not explored further, but also a number of unexplained anomalies at Abernethy South, Viking, Laser, Kayak and Swallow which were subsequently followed up, initially by limited traverses of RC drilling along with ground magnetic traverses.

In the following years, detailed ground magnetics, along with a detailed aeromagnetic survey (50m spaced E-W lines) was conducted, followed by aircore, RC and diamond drilling at a number of prospects including Abernethy South, Viking, Laser, Kayak, Swallow. Reconnaissance aircore drilling was also completed at other, more regional targets including Granite Well, Airstrip, Gascoyne Road, Mermaid South End, Hornet, Schooner and Mistral.

The focus of most of the later drilling was at the Abernethy South prospect where, saprolitic anomalism was discovered associated with quartz veins within a tonalitic intrusive beneath 24m of colluvial cover. The mineralisation is located within the intrusion and on an adjacent faulted mafic schist/black shale contact, interpreted to represent the Abernethy Shear Zone. Ultimately geological compilation suggested the potential for an easterly dipping structure in contrast to previous interpretations on which much of the previous drilling was based, most drilling up to that stage had been drilled dipping at 60 degrees towards the east. In 1996, a series of vertical aircore holes confirmed this hypothesis and outlined a zone of +1g/t mineralisation extending over 700m in strike length. Detailed follow-up drilling was recommended at this prospect, but was never completed. Aside from Abernethy South, follow-up RC and aircore drilling was also recommended at Airstrip, Tornado and Viking, Granite Well, Gascoyne Road, Tornado and South End.

During 1999, a number of RC holes were drilled at Abernethy South, Airstrip and Viking. The drill holes at Abernethy South were drilled with a 60 degree dip towards the north or south.

Prospectivity

Over the past decade, gold exploration has been focussed on drilling selected soil geochemical gold anomalies coincident with magnetic anomalies or areas of magnetic discontinuity. The area of most intense activity has been related to gold prospects mostly covered by transported overburden related to the concealed Abernethy Shear Zone over a strike length of some 17.5 kilometres along the southwestern portion of the property on the eastern flank of the Abbotts Greenstone Belt.

Outcomes from previous drilling campaigns have led to the identification of many areas of previously unknown supergene geochemical gold anomalism and sporadic gold mineralisation related to quartz veining associated with felsic and mafic intrusions and the Abernethy Shear Zone. To date, drilling has indicated gold mineralisation at depths to 100 metres below surface and there remains doubt as to the orientation of the mineralised structures and therefore the effectiveness of some aspects of previous exploration drilling.

Beyond the identified prospects, the property covers a large area of prospective greenstone belt. Future exploration can draw from a significant database of high resolution airborne magnetic data and an extensive surface soil geochemical and geological mapping database. Areas for future exploration which have received little attention so far are soil geochemical anomalies identified as associated with sulphidic sediments, concealed portions of the greenstone succession over the northeastern districts and northeasterly extensions to the Abernethy Shear Zone. Portions of the greenstone succession over western parts of the property where cover is thin offer a prospective area for future investigation.

Future exploration will benefit from further modelling and interpretation of the existing high resolution airborne magnetic data in order to identify new exploration targets. New targets could be generated by an integrated assessment of geomorphology and structure based on satellite imagery along with geochemical and magnetic data. Such a study should assist in mapping the regolith and delineating areas of residual soil cover where geochemistry can be used with confidence to delineate new exploration targets.

The most advanced prospect, Abernethy South, displays a 1km long area of stacked sub-horizontal 2-4m thick zones of supergene mineralisation overlying a mineralised tonalite intrusion adjacent to the mineralised Abernethy Shear Zone. The target has been tested to a depth of less than 100m and previous explorers could not define the orientation of the main mineralised veins.

Upon granting of the main EL, Doray intends to initiate a systematic drilling program designed to resolve the orientation of the main mineralised structures and to define an oxide and/or primary resource at Abernethy South.


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Abernethy South prospect showing mineralised zone associated with tonalite intrusion.

Most drilling is less than 100m deep.


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At the Airstrip prospect, vertical aircore drilling defined an 1800m long NE trending zone of mineralisation associated with tonalite and dolerite intrusives north of Abernethy South. About 50% of the previous drilling is less than 100m deep.

Doray will commence a systematic follow-up drilling program to determine the potential for this prospect to host a significant oxide and/or primary resource.

Other prospects requiring further work include Tornado – 300m long northeast striking zone of mineralisation; Gascoyne Road – two shallow aircore holes, 500m apart along strike require infill drilling; Several prospects such as South End and others have had only first pass, widely spaced drilling with no follow-up.

The proposed budget proposed by Doray for the first two years over the granted tenements will include geological review, field visits, mapping and sampling and is estimated at $15,000 for each year and a total of $30,000.

mingah proJect

Location and Tenure

The Mingah Project is located approximately 45km west of Meekatharra with one Exploration Licence Application, E51/1335 over 147km2. The project covers almost 40km of strike of interpreted greenstone on the eastern limb of the Mingah Range Greenstone Belt. Aeromagnetic data suggests a major structure, possibly the Big Bell Shear, passes through the project area and therefore indicates the potential for significant gold mineralisation.

Access to the area is via the Meekatharra-Carnarvon road and station tracks. Topography is dominated by extensive cover of alluvium and sheet wash along with several active drainages systems.

Geological Setting

The Mingah Property covers an area of low relief and extensive residual and transported soil cover along a portion of the eastern limb and nose region of a south plunging anticline forming part of the Archaean Mingah Range Greenstone Belt. Regionally, this belt comprises a sequence of generally low grade metamorphosed basalt, dolerite, ultramafic and felsic volcanics and shale intruded by differentiated gabbroic sills. The belt is separated from surrounding granitoids by a conformable northwest trending fault on its southwestern flank and by a major north northeast trending shear zone known as the Big Bell Shear and interpreted from airborne magnetic data along its eastern margin. This shear zone is interpreted as a major regional structure that links the property with the Big Bell area some 90 kilometres to the southwest.

On the property, the western parts fringing the more elevated portions of the greenstone belt are covered by limited areas of residual cover but over the eastern and southern portions of the property, the majority of the area has transported cover and calcrete deposits related to the Hope River palaeo channel system. Over the western fringes of the property, residual cover is relatively thin with sporadic exposure of the underlying greenstone succession.

In this area, the north-northeasterly trending eastern limb of the Mingah Range anticline dips to the east-southeast and is intersected by numerous northnortheast trending faults. In the southwestern portion of the property in the vicinity of the nose of the anticline, the structural grain follows a north-south trend producing a prominent flexure in the overall structural alignment.

Based on a regional airborne magnetic data interpretation, the eastern portion of the property, where superficial cover is thickest is underlain by granitoids with thin slivers of greenstone. Along the eastern flank and nose region of the Mingah Range anticline it would appear that younger granitoids have partially stoped and assimilated the greenstone succession although current interpretations are hampered by a lack of high resolution magnetic survey data that would allow for a more definitive structural assessment.

Mineralisation

Gold mineralisation in the Mingah Range Greenstone Belt is hosted by narrow, high grade quartz-pyrite-pyrrhotite veins that are developed both parallel to and discordant to enclosing rock units and that are associated with peripheral stockworks hosted by carbonate altered basalts with minor intercalated shale horizons. This mineralisation occurs beyond the limits of the Mingah Creek Property on adjacent ground in the nearby Chesterfield area where cover is thin and rock exposure is relatively good. Gold mineralisation is known at several localities on the western limb of the belt, including at Margueritta and Chesterfield, where high grade gold mineralisation is hosted in narrow quart-pyrite-pyrrhotite veins within carbonate-altered basalts.


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Aeromagnetic image for the Mingah Project area showing gold occurrences within western limb

and historical drilling designed to test for mineralisation on eastern limb.


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Geology within the project area is entirely covered by transported soil material and is therefore interpreted from previous drilling. The rock units consist of a felsic volcanic sequence intruded by mafic and ultramafic sills. The sills typically have a basal layer of peridotite or pyroxenite overlain by gabbro or dolerite.

Previous Exploration

Early exploration included gridding, RAB and auger drilling, regolith mapping and sampling. Wide spaced surface geochemical sampling on east-west lines with a rough spacing of 1600 x 100m covering almost 20km of strike was followed by similarly wide-spaced traverses of aircore drilling covering 15km of strike. Results were inconclusive with some holes failing to reach Archaean basement. Low-level gold anomalism was observed in drilling in basalt associated with elevated arsenic. The drill program was not considered sufficient to discount gold mineralisation along the major structure.

Further gold exploration was conducted over the Mingah Creek area in the late 1990s following selection of the area based on the hypothesis that the major regional shear trending north-northeast from Big Bell occurred beneath superficial cover in the region. A target focus was a major flexure on the shear interpreted from regional airborne magnetic data. Initial work comprised geological evaluation based on Landsat satellite imagery and assessment of regional geophysical data.

Ground exploration followed in the form of soil geochemical sampling on a 1600 metre by 100 metre grid over the western portion of the area covering the interpreted greenstone succession where thinner cover prevails. Two samples were collected from each site, the first being sieved and the second being a bulk sample. A total of 343 sites were sampled. The sieved samples were BLEG analysed and the bulk samples were screened and analysed for gold.

The fine fraction from the bulk samples did not show any anomalous values but the BLEG results delineated several moderately anomalous areas possibly with north northeast trends. Spot highs were obtained compared to lower background values.

A follow up aircore drilling program of 35 vertical holes for an aggregate of 1663 metres was conducted and designed to investigate gold anomalism and the depth of cover over the BLEG anomalies and selected structural targets. The program tested five east-west drill profiles and 15 kilometres of strike length. Drill samples were collected over four metre intervals and analysed for gold plus twelve other elements.

The drilling results indicated that the depth of cover varies across the property from a few metres in the west to over 100 metres in the east. It was also found that regolith preservation over Archaean basement was poor and that some of the drill holes were not effective because near surface calcrete horizons could not be penetrated.

Prospectivity and Proposed Work Program

The Mingah Property is assessed as having potential for the discovery of gold mineralisation based on the presence of a poorly exposed and complexly folded and faulted greenstone succession which off the property is known to host gold mineralisation at the nearby Chesterfield camp. So far the property has been explored below surface by only one shallow, widely spaced drilling program which proved the persistence of the greenstone succession beneath superficial cover with low levels of geochemical gold anomalism.

Based on regional assessments, the property is underlain by the Big Bell Shear which offers a target for future investigation related to structural flexures along its length. Currently, the structural complexity of the area is not well understood nor is the effect of the interplay of intrusive contacts between the greenstone succession and younger granitoids. It is therefore considered that effective future exploration will require the selection of structural drill targets within favourable host rocks based on high resolution airborne magnetic surveying.

There may be a role for surface geochemistry in the delineation of some targets where residual soils are present.

Overall, the property is regarded as a prospective under explored gold property that merits further more detailed investigation.

The presence of a major shear zone, along with anomalous gold and arsenic in shallow first pass drilling, indicates the potential for the project to host a significant gold deposit. Upon granting of the tenement, Doray intends to conduct a compilation of existing data and commission a detailed aeromagnetic survey over the project area to assist with structural interpretation and identification of drill targets for testing.

1mount magnet proJects1

magnet north-austin proJect

Location and Tenure

The Magnet North-Austin Project is located immediately north of Mount Magnet and comprises 2 exploration licence applications (E58/382 and E21/140) covering a total area of 165km2 and approximately 47km of strike of greenstone and the Cuddingwarra Shear Zone. Within the southern tenement, an excised mining lease covers the Blackman’s Find deposit, currently held by Harmony.


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Local geology and Mineralisation

The geology of the northern tenement, E21/140, is mostly obscured by Lake Austin whilst the southern tenement E58/382, has significantly more outcrop.

Local geology within the project area consists mainly of basalt with ultramafics and Banded Iron Formation observed in the southern tenement area surrounding Blackman’s Find.

A major structure trends N-S through the project area and is interpreted to represent a shear zone with the potential to host significant gold mineralisation. This separates the Gabanintha formation to the west from the mineralised Golconda Formation to the east and is referred to as the “Cuddingwarra Shear Zone” by various previous explorers. Gold mineralisation is observed at a number of localities along this structure from south of the project area at Lennonville, through the Blackmans Find workings and over 45km of strike to Cuddingwarra north of the Lake Austin tenement. The Blackmans Find workings reportedly produced 1060 ounces from 240 ton of ore.


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The Magnet North Project showing regional interpreted geology and

gold occurrences (red dots) with respect to major structures.


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Lake Austin

Various explorers have conducted gold exploration programs on and around the Lake Austin area prior to Doray acquiring the ground. The work included mapping, rock chip, soil and stream sediment sampling north of Lake Austin from 1987 onwards. The “Lake” prospect, north of Lake Austin, was discovered in 1991 and is characterised by a 350m long N-S zone of mineralisation in the Cuddingwarra Shear Zone at the contact between mafic and sedimentary units. mailto:anomalousAnomalous gold zones were returned from RC drilling of the structure. Generally the previous drilling was shallow regolith drilling undertaken to test the covered bedrock many holes completed were as shallow as 16m in depth. The “Trenton” area, also north of Lake Austin and straddling the Lennonville/Cuddingwarra Shear was explored from 1993 onward with data compilation, airphoto interpretation, mapping, gridding and BLEG sampling. An area of interest was defined at the “Vicious” prospect. Work in 1997 defined a 600m long zone of gold mineralisation at the “Busload of Faith” prospect on Lake Austin with anomalous results.

Magnet North

In 1991, gridding, deflation lag sampling and angled 80m deep RC drilling of the geochemical anomalies was carried out. Significant results were returned from weathered BIF at the western end of the drill traverse. Work during 1992 consisted of mapping, gridding, follow-up surface geochemistry and extensive ground magnetic surveys. 35 RC holes were drilled over the Blackman’s Find and Water Tank Hill anomalies approximately 1.2km south of the boundary of M58/222. Follow-up work completed during 1993 included a detailed aeromagnetic survey, EM surveys, regolith mapping and surface geochemical sampling and RC drilling.

During 1994 and 1995, the aeromagnetic data was further interpreted and limited drilling was done at the far northern end of the project area.

In 1996, a program of aircore drilling, with 400m line spacing, focussed on the areas north and south of the earlier work aimed to test the NE trending Magnet-Meekatharra Shear.


The Lake Austin tenement remains highly prospective given the lack of outcrop and its position straddling the mineralised Cuddingwarra Shear Zone. Prospects identified by previous explorers, such as the “Lake” and “Busload of Faith” prospect show significant strike lengths of gold mineralisation and alteration that have had little systematic follow-up and drill-testing.

Two areas of interest in the Blackmans Find area require follow-up work upon granting of the tenement namely the 3.2km long zone immediately south of previous drilling; and an anomalous intersection to the north. Other results from the program returned lower results on average. The intersection is open to the south and north for at least 400m in each direction and all drilling is shallower than 100m

Upon granting of the tenements, Doray plans to carry out a detailed compilation of all previous work, followed by infill and deeper drilling of the key areas described above. Success will depend in part on Doray developing a cost effective way to explore on Lake Austin. This could involve the use of innovative geochemical and geophysical techniques.

Western queen proJect

Location and Tenure

The Western Queen Project is located approximately 85km west of Mt Magnet and consists of one exploration licence application, E59/1621 (160km2) which covers approximately 35km of strike of the Warda Warra Greenstone Belt. The historic Western Queen and Western Queen South gold deposits are located within excised mining leases surrounded by the project area.

Access to the project area is via the Yalgoo-Cue road and a network of station tracks. Harmony has lodged an objection to the grant of E59/1621 on the basis that it has a Miscellaneous Licence for its Western Queen haul road. Doray will need to negotiate an Access Agreement with Harmony before the licence will be granted.


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Local geology and Mineralisation

The geology of the project area is characterised by a sequence of parallel N-S trending greenstone units of the Gabanintha and Golconda Formations on the west and east sides respectively.

The Golconda Formation consists of a series of quartz-haematite Banded Iron Formation interlayered with mafic ultramafic extrusive and intrusive rocks. The Gabanintha Formation is the most widespread group of rocks in the North Murchison, according to Prussner (2000) and, in the Western Queen area, consists of a sequence of high-Mg basalts, intrusive ultramafics and gabbro sills.

A number of late felsic pegmatitic dykes intrude the older rocks and associated beryl and tantalite have been mined from a number of pits within the project area.

Gold mining has occurred within the project area sporadically from 1928 up until 2007 with the major production coming from the Western Queen open pit and underground deposit (approx. 160,000 oz) and the Western Queen South open pit


A comprehensive drilling program at Western Queen and the surrounding areas defined an Inferred Resource at the Western Queen deposit. Production commenced in 1999 and produced approximately 162,000oz @8.77g/t from the Western Queen open cut and approximately 19,000oz from the underground Western Queen Deeps mine until mining finished in 2001. Subsequent work increased the Western Queen South deposit to an Inferred Resource which is open at depth. These deposits are excluded from Doray’s tenement holding.

Work outside the Western Queen and Western Queen South deposit areas has generally been limited with the exception of directly along strike to the south. To date parallel south plunging mineralisation has been identified at Western Queen and Western South (open at depth) and possibly a third parallel zone of mineralisation may exist within Doray’s project area.


Exploration in the Warda Warra belt has not been exhaustive and a number of exploration targets have been identified from structural and magnetic interpretation over poorly exposed ground.

The presence of known high grade resources on the Western Queen Shear and established mining operations in the recent past are strong indicators of the prospectivity of the area.

Despite an apparent long and complex history of exploration and mining, the Western Queen Project remains highly prospective for additional small high grade deposits. The most obvious target is the area directly south of the Western Queen South deposit where previous drilling is wide spaced and shallow and there is potential for a third south-plunging zone of mineralisation similar to that seen at Western Queen and Western Queen South.

The 5km strike extension of the Western Queen Shear on Doray’s ground is concealed by on average 20-25m of alluvial and Tertiary sediments increasing the potential that additional concealed mineralisation may exist in this area.

Another prospective 3.5km long target zone is located to the north of M59/208, along the granite-greenstone contact. There is also some potential for nickel sulphide mineralisation in the same area.

Upon eventual granting of the Exploration Licence, Doray intends to commence a systematic compilation of all previous available data within the project area followed by an aggressive program of infill and deeper drilling along the Western Queen Shear, south of the boundary with M59/208.

1southern yilgarn proJect1

lake magenta golD proJect

Location and Regional Setting

The Lake Magenta project is located approximately 20km northeast of the town of Jerramungup on the south coast of Western Australia. The project comprises one Exploration Licence application, E70/3619, which covers 162km2 of freehold farmland between the Lake Magenta Nature Reserve to the north and the Fitzgerald River National Park to the south.

The project covers approximately 17km of the Yandina Shear Zone, a mineralised structure originally interpreted from aeromagnetic data and subsequently confirmed with surface geochemistry, IP and reconnaissance drilling.

The regional geology of the area comprises granite and gneiss of the SW Gneiss Terrane, however aeromagnetic data and mapping to the south east suggest the presence of rafts of greenstone lithologies caught up in the gneissic units.


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Lake Magenta South Project showing previous drill intercepts.

Local geology and mineralisation

Outcrop geology in the project area is virtually non-existent apart from an area of foliated granodiorite in the south eastern part of the project area. Most of the geology and structure is interpreted form regional and later, more detailed aeromagnetic data and subsequent drilling. The predominant rock–type is banded intermediate and felsic gneisses with porphyry intrusives.

Mineralisation is known at a number of prospects within the project area and further to the south, however this was mostly discovered only within the last 2-3 years and has not been fully reported. Dominion stated “the style of the sulphide mineralisation and associated alteration are similar to other gold mineralised districts (eg Boddington and Southern Cross belt) and is believed to significantly enhance the prospectivity of this very large gold anomaly”.


Earlier workers carried out surface geochemical sampling, infill 200m spaced aeromagnetic surveys, IP and subsequent “interface” RAB and aircore drilling and limited RC and diamond drilling from 2004 until 2009 when they surrendered the tenements.

A 10km long and 15km2 zone of gold anomalism in calcrete and laterite samples was discovered at Lake Magenta South (along with similar size but lower magnitude anomalies to the north of the Nature Reserve) coincident with the interpreted position of the Yandina Shear zone. About 25% of the anomaly showed coherent values of five times background and several higher values were also observed. Follow-up sampling along strike to the south east extended the anomaly to greater than 20km2.

Initial drill testing in 2004 involved three traverses of RAB and aircore across the so-called “Western” and “Eastern” zones which intersected “widespread gold anomalism within and at the base of the weathered profile” and coincident with the best surface geochemical anomalies. Quartz veining and sulphides were noted and dark coloured clays interpreted to represent the weathered expression of a major gold bearing structure. Other bottom of hole anomalous intercepts were associated with contacts between mafic and felsic units.

Interpretation of the infill 20m spaced aeromagnetic data resolved that the main Yandina Shear Zone was folded in the Lake Magenta South area and the project area divided into the western and eastern limbs of the fold. In turn, the western limb comprises two en-echelon zones dubbed “WZ1” and “WZ2”.

Follow-up drilling of the three prospects in 2005 returned significant results. In addition, a single RC hole was drilled to test the zone of sulphidic “dark clays” observed in the earlier drilling. The hole ended in sulphidic materials. IP surveys highlighted a number of chargeability anomalies interpreted to reflect sulphide zones in bedrock. The IP data also


46

suggested a westerly dip for mineralisation the western zones. Limited RC drilling of the western zone intersected two thick zones of pyrite, pyrrhotite and chalcopyrite from 84-94m and from 147-176m with anomalous gold grades. Other results from the programs returned lower results on average.

Two diamond drill holes were completed during 2006 and, whilst intersecting low gold grades, provided information on the extensive alteration and chalcophile element anomalism of the project area. A program of 50m spaced RAB and aircore drilling was also completed and extended the length of the eastern zone. Geology intersected included mafic, intermediate and felsic gneisses along with numerous porphyry intrusions. Further RC drilling intersected visible gold from one hole in the western zone and anomalous values in the Hinge Zone. Other results from the program returned lower results on average.


The Lake Magenta project is characterised by significant and aerially extensive surface geochemical anomalism related to a major structure. The project has subsequently been drill tested and found to contain several prospects defined by regolith and bedrock gold anomalism with abundant sulphides and chalcophile anomalism.

The prospects in most cases have had first pass drilling and only limited RC and diamond drill testing and the project has in no way been exhaustively tested.

Upon granting of the tenement, Doray intends to conduct a compilation and interpretation of all previous work including site visits, re-sampling (where possible) and meeting with landholders. Doray then plans to conduct a program of selected deeper RC and/or diamond drilling of the best intersections and structural targets in an effort to confirm the previous results.

references

meekatharra northBegg, G.C. 1998. “Annual Report, 30/6/1997 to 30/6/1998. Meekatharra North Project Exploration Licences E51/290 E51/408 E51/409 E51/473

M51/663-664 and P51/1897-1901” WMC Resources Ltd, Exploration Division.

Doan, T.V., 1996. “Annual Report, 30/6/1995 to 30/6/1996. Meekatharra North Project Exploration Licences E51/290 E51/408 E51/409 E51/473 P51/1826 to P51/1834 and P51/1897 to P51/1901” WMC Resources Ltd, Exploration Division.

abbottsDoan, T.V. 1997. “Fifth Annual Report for Period 1 Jan 1996 to 31 December 1996. Abernethy Project Mining Licences 51/536, 537 and 585

(Applications) and Exploration Licences E51/319 and 324.” WMC Resources Ltd, Exploration Division.

Rees, B.V.L., 1999. “Abernethy Project. Annual Report for Period ending January 1999. E51/319, 324 and 354 P51/1630-31. Australasian Gold Mines NL.

mingahBennett, A., 1998. Annual Report for Period 7/10/97 to 6/10/98. Mingah Creek Project, Exploration Licence E51/794, BELELE SG50-11

1:250,000 Sheet. WMC Resources Ltd, Exploration Division, Belmont WA.

Boxer, G.L., 1996 Partial Surrender report for E51/365 and E51/366. Belele Project. SG50-11 BELELE, Western Australia. CRA Exploration Pty Ltd

magnet northFleming, T.R., 1998 Annual Report E21/39 – Trenton. 13/11/1996 to 12/11/1997. Wirralie Gold Mines Pty Ltd.

Fletcher, M. 1996. Combined Annual Report - Exploration Licence E58/108, M58/215, M58/222 and M58/223 For The Period 13 January 1995 to 12 January 1996. Blackmans Joint Venture. WMC Limited – Hill 50 Gold Mine NL.

Mazzoni, P.P. 1993 Annual Report for the Period 13 Jan 1992 to 12 Jan 1993. Blackmans Joint Venture. Exploration Licence E58/108 and Prospecting Licence P58/712. Western Mining Corporation Ltd - Exploration Division.

Mazzoni, P.P. 1994 Annual Report for the Period 13 Jan 1993 to 12 Jan 1994. Blackmans Joint Venture. Exploration Licence E58/108 and Prospecting Licence P58/712. Western Mining Corporation Ltd - Exploration Division.

Watkins, K., 1091, Austin Joint Venture E21/15 Report for the Period 1/6/90 to 31/3/91. RGC Exploration Pty Ltd unpublished.

Western queenPrussner, S., 2000. Combined Annual Report for the Western Queen Tenements Dalgaranga Gold Mines JV Western Australia for the Period 1

July 1999 to 30 June 2000. Equigold NL.

Watkins, K.P., and Hickman A. H., 1990. Geological Evolution and Mineralization of the Murchison Province, Western Australia. Geological Survey of Western Australia, Bulletin 137.

lake magentaDominion Mining Ltd Annual and Quarterly Reports


47

glossary of technical termsaeolian Formed or deposited by wind.

aerial photography Photographs of the earths surface taken from an aircraft.

aeromagnetic A survey undertaken by helicopter or fixed-wing aircraft for the purpose of recording magnetic characteristics of rocks by measuring deviations of the earths magnetic field.

airborne geophysical data Data pertaining to the physical properties of the earths crust at or near surface and collected from an aircraft.

aircore Drilling method employing a drill bit that yields sample material which is delivered to the surface inside the rod string by compressed air.

alluvial Pertaining to silt, sand and gravel material, transported and deposited by a river.

alluvium Clay silt, sand, gravel, or other rock materials transported by flowing water and deposited in comparatively recent geologic time as sorted or semi-sorted sediments in riverbeds, estuaries, and flood plains, on lakes, shores and in fans at the base of mountain slopes and estuaries.

alteration The change in the mineral composition of a rock, commonly due to hydrothermal activity.

amphibolite facies An assemblage of minerals formed at moderate to high temperatures (450C to 700C) during regional metamorphism.

andesite An intermediate volcanic rock composed of andesine and one or more mafic minerals.

anomalies An area where exploration has revealed results higher than the local background level.

anticline A fold in the rocks in which strata dip in opposite directions away from the central axis.

antiformal An anticline-like structure.

Archaean The oldest rocks of the Precambrian era, older than about 2,500 million years.

assayed The testing and quantification metals of interest within a sample.

Au Chemical symbol for gold.

auger sampling A drill sampling method using an auger to penetrate upper horizons and obtain a sample from lower in the hole.

axial plane The plane that intersects the crest or trough of a fold, about which the limbs are more or less symmetrically arranged.

basalts A volcanic rock of low silica (<55%) and high iron and magnesium composition, composed primarily of plagioclase and pyroxene.

polymetallics A non-precious metal, usually referring to copper, lead and zinc.

bedrock Any solid rock underlying unconsolidated material.

BIF A rock consisting essentially of iron oxides and cherty silica, and possessing a marked banded appearance.

BLEG sampling Bulk leach extractable gold analysis; an analytical method for accurately determining low levels of gold.

brittle Rock deformation characterised by brittle fracturing and brecciation.

Cainozoic An era of geological time spanning the period from 65 million years ago to the present.

carbonate Rock of sedimentary or hydrothermal origin, composed primarily of calcium, magnesium or iron and CO

3. Essential component of limestones and marbles.

chert Fine grained sedimentary rock composed of cryptocrystalline silica.

chlorite A green coloured hydrated aluminium-iron-magnesium silicate mineral (mica) common in metamorphic rocks.

clastic Pertaining to a rock made up of fragments or pebbles (clasts).

clays A fine-grained, natural, earthy material composed primarily of hydrous aluminium silicates.

colluvium A loose, heterogeneous and incoherent mass of soil material deposited by slope processes.

conduits The main pathways that facilitate the movement of hydrothermal fluids.

conglomerate A rock type composed predominantly of rounded pebbles, cobbles or boulders deposited by the action of water.

copper A reddish metallic element, used as an electrical conductor an the basis of brass and bronze.

dacite An extrusive rock composed mainly of plagioclase, quartz and pyroxene or hornblende or both.

depletion The lack of gold in the near-surface environment due to leaching processes during weathering.

diamond drill hole Mineral exploration hole completed using a diamond set or diamond impregnated bit for retrieving a cylindrical core of rock.

dilational Open space within a rock mass commonly produced in response to folding or faulting.

dolerite A medium grained mafic intrusive rock composed mostly of pyroxenes and sodium-calcium feldspar.

DoIR Department of Industry and Resources, WA.


48

ductile Deformation of rocks or rock structures involving stretching or bending in a plastic manner without breaking.

dykes A tabular body of intrusive igneous rock, crosscutting the host strata at a high angle.

en-echelon Repeating parallel, but offset, occurrences of lenticular bodies such as ore veins.

erosional The group of physical and chemical processes by which earth or rock material is loosened or dissolved and removed from any part of the earths surface.

fault zone A wide zone of structural dislocation and faulting.

feldspar A group of rock forming minerals.

felsic An adjective indicating that a rock contains abundant feldspar and silica.

folding A term applied to the bending of strata or a planar feature about an axis.

foliated Banded rocks, usually due to crystal differentiation as a result of metamorphic processes.

follow-up A term used to describe more detailed exploration work over targets generated by regional exploration.

g/t Grams per tonne, a standard volumetric unit for demonstrating the concentration of precious metals in a rock.

gabbro A fine to coarse grained, dark coloured, igneous rock composed mainly of calcic plagioclase, clinopyroxene and sometimes olivine.

geochemical Pertains to the concentration of an element.

geophysical Pertains to the physical properties of a rock mass.

GIS database A system devised to present partial data in a series of compatible and interactive layers.

gneissic Coarse grained metamorphic rocks characterised by mineral banding of the light and dark coloured constituent minerals.

granite A coarse-grained igneous rock containing mainly quartz and feldspar minerals and subordinate micas.

granoblastic A term describing the texture of a metamorphic rock in which the crystals are of equal size.

granodiorite A coarse grained igneous rock composed of quartz, feldspar and hornblende and/or biotite.

greenschist A metamorphosed basic igneous rock which owes its colour and schistosity to abundant chlorite.

greenstone belt A broad term used to describe an elongate belt of rocks that have undergone regional metamorphism to greenschist facies.

greywackes A sandstone like rock, with grains derived from a dominantly volcanic origin.

GSWA Geological Survey of Western Australia.

gypsum Mineral of hydrated, or water-containing, calcium sulphate.

halite Impure salt deposit formed by evaporation.

hangingwall The mass of rock above a fault, vein or zone of mineralization.

hematite Iron oxide mineral, Fe2O3.

hinge zone A zone along a fold where the curvature is at a maximum.

hydrothermal fluids Pertaining to hot aqueous solutions, usually of magmatic origin, which may transport metals and minerals in solution.

igneous Rocks that have solidified from a magma.

infill Refers to sampling or drilling undertaken between pre-existing sample points.

insitu In the natural or original position.

interflow Refers to the occurrence of other rock types between individual lava flows within a stratigraphic sequence.

intermediate A rock unit which contains a mix of felsic and mafic minerals.

intrusions A body of igneous rock which has forced itself into pre-existing rocks.

intrusive contact The zone around the margins of an intrusive rock.

ironstone A rock formed by cemented iron oxides.

isoclinal A series of folds that dip in the same direction at the same angle.

joint venture A business agreement between two or more commercial entities.

komatiitic Magnesium-rich mafic to ultramafic extrusive rock.

laterite A cemented residuum of weathering, generally leached in silica with a high alumina and/or iron content.

lead A metallic element, the heaviest and softest of the common metals.

lineament A significant linear feature of the earth’s crust, usually equating a major fault or shear structure.

lithological contacts The contacts between different rock types.

lithotypes Rock types.

magnetite A mineral comprising iron and oxygen which commonly exhibits magnetic properties.


49

metamorphic A rock that has been altered by physical and chemical processes involving heat, pressure and derived fluids.

metasedimentary A rock formed by metamorphism of sedimentary rocks.

monzogranite A granular plutonic rock containing approximately equal amounts of orthoclase and plagioclase feldspar, but usually with a low quartz content.

Moz Millions of ounces.

Mt Million Tonnes.

mylonite A hard compact rock with a streaky or banded structure produced by extreme granulation of the original rock mass in a fault or thrust zone.

nickel Silvery-white metal used in alloys.

nickel laterite Nickel ore hosted within the laterite profile, usually derived from the weathering of olivine-rich ultramafic rocks.

open pit A mine working or excavation open to the surface.

Orthoimage A geographically located composite plan using aerial photography as a base.

outcrops Surface expression of underlying rocks.

palaeochannels An ancient preserved stream or river.

pegmatite A very coarse grained intrusive igneous rock which commonly occurs in dyke-like bodies containing lithium-boron-fluorine-rare earth bearing minerals.

pisolitic Describes the prevalence of rounded manganese, iron or alumina-rich chemical concretions, frequently comprising the upper portions of a laterite profile.

playa lake Broad shallow lakes that quickly fill with water and quickly evaporate, characteristic of deserts.

polymictic Referring to coarse sedimentary rocks, typically conglomerate, containing clasts of many different rock types.

porphyries Felsic intrusive or sub-volcanic rock with larger crystals set in a fine groundmass.

ppb Parts per billion; a measure of low level concentration.

Proterozoic An era of geological time spanning the period from 2,500 million years to 570 million years before present.

pyroxenite A coarse grained igneous intrusive rock dominated by the mineral pyroxene.

quartz reefs Old mining term used to describe large quartz veins.

quartzofeldspathic Compositional term relating to rocks containing abundant quartz and feldspar, commonly applied to metamorphic and sedimentary rocks.

quartzose Quartz-rich, usually relating to clastic sedimentary rocks.

RAB drilling A relatively inexpensive and less accurate drilling technique involving the collection of sample returned by compressed air from outside the drill rods.

rafts A relatively large block of foreign rock incorporated into an intrusive magma.

RC drilling A drilling method in which the fragmented sample is brought to the surface inside the drill rods, thereby reducing contamination.

regolith The layer of unconsolidated material which overlies or covers insitu basement rock.

residual Soil and regolith which has not been transported from its point or origin.

resources Insitu mineral occurrence from which valuable or useful minerals may be recovered.

rhyolite Fine-grained felsic igneous rock containing high proportion of silica and felspar.

rock chip sampling The collection of rock specimens for mineral analysis.

saline Salty

saprock Zone of weathered rock preserved within the weathered profile.

saprolite Disintegrated, in-situ rock, partially decomposed by the chemical and physical processes of oxidation and weathering.

satellite imagery The images produced by photography of the earth’s surface from satellites.

schist A crystalline metamorphic rock having a foliated or parallel structure due to the recrystallisation of the constituent minerals.

scree The rubble composed of rocks that have formed down the slope of a hill or mountain by physical erosion.

sedimentary A term describing a rock formed from sediment.

sericite A white or pale apple green potassium mica, very common as an alteration product in metamorphic and hydrothermally altered rocks.

shale A fine grained, laminated sedimentary rock formed from clay, mud and silt.

sheared A zone in which rocks have been deformed primarily in a ductile manner in response to applied stress.


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sheet wash Referring to sediment, usually sand size, deposited over broad areas characterised by sheet flood during storm or rain events. Superficial deposit formed by low temperature chemical processes associated with ground waters, and composed of fine grained, water-bearing minerals of silica.

silcrete Superficial deposit formed by low temperature chemical processes associated with ground waters, and composed of fine grained, water-bearing minerals of silica.

silica Dioxide of silicon, SiO2, usually found as the various forms of quartz.

sills Sheets of igneous rock which is flat lying or has intruded parallel to stratigraphy.

silts Fine-grained sediments, with a grain size between those of sand and clay.

soil sampling The collection of soil specimens for mineral analysis.

stocks A small intrusive mass of igneous rock, usually possessing a circular or elliptical shape in plan view.

strata Sedimentary rock layers.

stratigraphic Composition, sequence and correlation of stratified rocks.

stream sediment sampling The collection of samples of stream sediment with the intention of analysing them for trace elements.

strike Horizontal direction or trend of a geological structure.

subcrop Poorly exposed bedrock.

sulphide A general term to cover minerals containing sulphur and commonly associated with mineralization.

supergene Process of mineral enrichment produced by the chemical remobilisation of metals in an oxidised or transitional environment.

syenite An intrusive igneous rock composed essentially of alkali feldspar and little or no quartz and ferromagnesian minerals.

syncline A fold in rocks in which the strata dip inward from both sides towards the axis.

talc A hydrous magnesium silicate, usually formed due to weathering of magnesium silicate rocks.

tectonic Pertaining to the forces involved in or the resulting structures of movement in the earth’s crust.

tholeiitic A descriptive term for a basalt with little or no olivine.

thrust fault A reverse fault or shear that has a low angle inclination to the horizontal.

tremolite A grey or white metamorphic mica of the amphibole group, usually occurring as bladed crystals or fibrous aggregates.

ultramafic Igneous rocks consisting essentially of ferromagnesian minerals with trace quartz and feldspar.

veins A thin infill of a fissure or crack, commonly bearing quartz.

volcaniclastics Pertaining to clastic rock containing volcanic material.

volcanics Formed or derived from a volcano.

zinc A lustrous, blueish-white metallic element used in many alloys including brass and bronze.


51

5(b) south australian australian proJects


52


53

executive summaryDoray Minerals Limited (“Doray”) holds interests in six properties covering a total of 1,078 square kilometres on the Gawler Craton in South Australia. Details of the Company’s interests are given in the Independent Solicitor’s Report, elsewhere in this Prospectus. These properties have potential for the discovery of commercial minerals, principally gold deposits. There are also prospects for the discovery of sediment-hosted deposits of uranium and possibly for iron-oxide-copper-gold-uranium (IOCGU) deposits.

Nuckulla Hill Project holds potential for structurally-controlled gold deposits within the Yarlbrinda Shear Zone. This major structure hosts a defined gold-silver resource 50 kilometres to the north at Tunkillia and hosts several known occurrences of gold in concealed bedrock within the Nuckulla Hill Project. The Project also holds potential for the discovery of sedimentary uranium deposits in a relatively unexplored section of the Narlaby Palaeochannel, which hosts uranium mineralisation associated with redox fronts at Yarranna Prospect, 35 kilometres to the south-west.

Hicks and Kingoonya Projects hold potential for structurally-controlled gold deposits within the west-north-west trending Labyrinth Shear Zone. Gold mineralisation appears to be controlled by this structure at several places, which include the historic Lake Labyrinth Goldfield four kilometres west of Hicks Project and at concealed bedrock gold prospects within and to the east of the Project. In the Kingoonya Project, west-north-west trending calcrete gold geochemical anomalies may reflect gold mineralisation associated with a probable extension of the Labyrinth Shear Zone.

Harris Bluff Project holds potential for epithermal deposits of gold, silver and base metals. The Project lies between the epithermal gold-silver deposits at Parkinson Dam and the probable IOCGU-related base and precious metal mineralisation at Menninnie Dam, and shares the same general geological setting as those deposits. Several other significant base and precious metal prospects are also found in this setting and all appear to be related to the Mesoproterozoic igneous activity that produced the Gawler Range Volcanics and the Hiltaba Suite intrusives.

All of Doray’s Projects lie close to the margin of the Gawler Range Volcanics Domain, in a preserved former sub-volcanic igneous environment, which may be considered prospective for IOCGU deposits such as Olympic Dam.


54

Regional Geology Map of South Australia showing location of Doray’s South Australian Projects.


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nuckulla hill proJect

introduction

This project comprises three properties, Nuckulla Hill (EL 4302), Lake Gairdner (ELA 133/09) and Kondoolka (ELA 254/09), which together cover an area of 640 square kilometres in the Central Gawler Craton Gold province. The project covers a section of the Yarlbrinda Shear Zone, from 25 km to 85 km south of the Tunkillia gold-silver resource. Resource definition at Tunkillia has identified a JORL-compliant resource of 14.3 mt @ 1.8g/t Au for a total gold resource of approximately 800,000 ounces (measured 66,000 oz, indicated 356,000 oz and inferred 377,000 oz), in deposits controlled by the northern Yarlbrinda Shear Zone. Nuckulla Hill was the site of the first gold discovery within the Yarlbrinda Shear Zone, made 50 km south of Tunkillia in 1995.

geological setting

The Nuckulla Hill Project lies on the western margin of the Mesoproterozoic Gawler Range Volcanic province, covering the central section of a north-south trending regional structure, the Yarlbrinda Shear Zone. Basement rocks are principally Palaeoproterozoic, including heterogeneous magmatic intrusive rocks of the St Peter Suite and granitoids of the Tunkillia Suite. These are intruded by Mesoproterozoic granites of the Hiltaba Suite, which are of comparable age and chemistry to the granites associated with IOCG deposits at Olympic Dam and Prominent Hill. The Yarlbrinda Shear Zone was active before and during the emplacement of the Hiltaba Suite. The shear zone therefore represented a potential pathway for mineralising fluids associated with the Hiltaba Suite intrusives, and provided potential structural settings for the accumulation of resulting mineral deposits.

A tributary of the Tertiary Narlaby Palaeochannel system crosses the Kondoolka licence on a west-north-westerly trend. Bedrock exposure is rare because of a blanket cover of calcrete, soil and sand, which overlies a weathered basement layer (saprolite) up to about 50 m thick.


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Nuckulla Hill Project showing outcrop geology and previous drilling.


57

previous exploration

Since the earliest exploration here in 1972, explorers have targeted uranium, base and precious metals, including Iron Oxide Copper Gold (IOCG) deposits, gold, diamonds and heavy mineral sands. The main stimulus to exploration was the recognition in the 1990s of the Yarlbrinda Shear Zone, a major north-south structure marking the western limit of the Gawler Range Volcanic province, and the subsequent discovery of associated structurally controlled gold mineralisation, first at Nuckulla Hill and later further north at Tunkillia.

Uranium

Uranium prospecting by CRA Exploration Pty Ltd (CRAE) in 1972-73 covered a region including the southern Nuckulla Hill Project tenement (Kondoolka ELA 254/09). An airborne radiometric survey indicated that the Hiltaba Granite could hold potential for uranium mineralisation, either as primary deposits in bedrock or as a source for secondary deposits in sediments derived by weathering of the granite. Follow-up scintillometer surveys and geochemical sampling of rock chips and groundwaters showed that the Hiltaba Granite contains about 1.5 times the average uranium content for granite and 3 times the average thorium content. CRAE concluded that these results probably explained the airborne radiometric responses.

Between 1979 and 1983, encouraged by the CRAE results, Carpentaria Exploration Co. Pty Ltd (CEC) explored for sedimentary uranium in an area mainly west and southwest of Nuckulla Hill, but extending across the southern part of the Project. Drilling revealed the presence of a major Tertiary palaeochannel system (the Narlaby Palaeochannel) and intersected significant and widespread uranium mineralisation within the palaeochannel sediments. At Yarranna Prospect, 30 km southwest of the Project, CEC discovered several significant but sub-economic uranium deposits, associated with complex redox fronts in well-developed sands of the Narlaby Palaeochannel.

Toro Energy Ltd (Toro) explored for sedimentary uranium in the southern part of the Project between 2005 and 2008, in a joint venture involving Equinox Resources Ltd (Equinox) and Minotaur Operations Pty Ltd (Minotaur). Toro flew a regional TEMPEST electromagnetic survey to produce interpreted depth to bedrock imagery, which revealed a deep Tertiary palaeochannel crossing the southern Project area from east to west, and draining exposed uranium-bearing felsic rocks of the Hiltaba Granite and Gawler Range Volcanics. Toro interpreted the palaeochannel course from NOAA satellite thermal images, sampled salt lakes producing radiometric anomalies, and then planned aircore drilling to test targeted sections of the palaeochannel for sedimentary uranium deposits. However, Toro did not proceed with the planned aircore program, citing difficult drilling access and anticipated high costs, which could not be justified at that time.

Base and Precious Metals (including Gold and IOCG Deposits)

Utah Development Co. (Utah) was the earliest base metal explorer in the area, in 1980-81. A regional geochemical exploration program sampled rock chips and stream sediments over an area that extended across the Nuckulla Hill tenement (EL 4302).

Oolanta Pty Ltd (Oolanta) conducted the earliest gold exploration in this area, in 1990. Oolanta undertook a program of field reconnaissance and limited hand auger geochemical sampling, searching for heavy mineral sands as well as gold. The program extended over the northern Project tenement (Lake Gairdner ELA 133/09). A granitic rock sample collected 25 km north of the Nuckulla Hill Project contained a visible trace of gold and assayed 3.15 g/t Au.

Equinox Resources NL (Equinox) explored throughout the Project area for IOCG and gold deposits between 1994 and 2008, bringing in Phelps Dodge Australasia Inc. (Phelps Dodge) as a joint venture partner from 1995. Equinox subsequently made the first significant discovery of gold in this region, at Nuckulla Hill. Initial interest was sparked following the release by Mines and Energy South Australia (MESA, now replaced by PIRSA) in 1993 of aeromagnetic and radiometric data acquired under the South Australian Exploration Initiative (SAEI). Aeromagnetic images revealed the presence of a major regional structure, the Yarlbrinda Shear Zone, which trends northerly through the Nuckulla Hill area, adjacent to the western margin of the Gawler Range Volcanic province. Structural analysis showed that the shear zone was active both before and during emplacement of Mesoproterozoic Hiltaba Suite intrusives; therefore the structure could have acted as a potential fluid pathway for mineralising solutions, as well as providing sites for accumulation of mineral deposits. Equinox recognised the potential for deposition of IOCG and structurally controlled gold deposits in this environment.

Regional calcrete, soil and rock chip sampling carried out by Equinox identified several gold geochemical anomalies. Infill sampling confirmed the presence of significant anomalies associated with the Yarlbrinda Shear Zone at Sheoak, Myall and Bimba Prospects. Follow-up RAB, aircore, reverse circulation and diamond drilling at these three prospects intersected significant gold mineralisation, concealed beneath a cover of Recent sands and about 50 m of weathered bedrock (saprolite). Significant intercepts at Bimba include 24 m @ 1.0 g/t Au from 122 m in NHRC 13 (refer to diagram below for all intercepts on this cross section).


58

Equinox also flew a detailed aeromagnetic survey on east-west flight lines, which greatly improved definition of the north-south trending Yarlbrinda Shear Zone, as the previous (SAEI) survey was flown on north-south flight lines. However, although more than 600 drill holes penetrated the gold prospects, Equinox and Phelps Dodge defined no economic mineralisation and were unable to resolve an apparent disparity between the anomalous calcrete geochemistry and the results from drilling of the underlying bedrock.

Cross Section for Bimba Prospect showing regolith and bedrock gold anomalism beneath original calcrete anomaly.

In 2005, the Department of Primary Industry and Resources (PIRSA) completed the PACE-funded Gawler Craton Gravity Survey, which covered most of the Kondoolka licence and part of the Nuckulla Hill licence, collecting data at 2 x 2 km centres, with some more detailed acquisition at 2 x 1 km.

Minotaur Operation Pty Ltd (Minotaur) farmed into the Equinox ground in 2004, and shifted the exploration focus to IOCG deposits, using gravity as the main exploration tool. Detailed gravity surveys over the southern part of the area revealed significant anomalies at Myall East and Arburee South Prospects. Three PACE-funded RC holes tested the 3-mgal A4 anomaly at Myall East. The holes intersected Palaeoproterozoic intrusives of the Tunkillia or St Peter Suite, including a gabbro, which was assumed to account for the 3-mgal gravity anomaly. The second gravity anomaly was not tested.

Minotaur then shifted attention to the northern part of the area, where they identified a subtle, 25 km long gravity anomaly, coincident with a magnetically quiet zone within the Yarlbrinda Shear Zone. To test the possibility that this anomaly reflected IOCG style mineralisation, Minotaur drilled an east-west line of 21 aircore holes across the zone. Although the gravity-magnetic anomaly was not explained, the drilling did not intersect anomalous geochemistry, indicating that it does not reflect an IOCG system. A follow-up biogeochemical vegetation survey detected a broad zone of gold anomalism, but correlation with bedrock drilling results was problematical.

From 2004 to 2009, Southern Gold explored for gold in the southern part of the Project (Kondoolka ELA 254/09) and peripheral to the northern part of the Nuckulla Hill Project. Southern Gold targeted hydrothermal gold deposits that might be localised by fault splays developed adjacent to the Yarlbrinda Shear Zone in the Central Gawler Gold Province. A PACE-funded aircore drilling program targeted a northeast trending demagnetised fault splay. The drill holes intersected granitic and mylonitic rocks, but no significant geochemical anomalies. Southern Gold concluded that earlier calcrete sampling by Equinox may not accurately reflect potential gold mineralisation in concealed underlying basement.


59

other exploration

Stockdale Prospecting Ltd explored for diamonds in 1981-82, covering an area that extended partly onto the southern part of the Project area.

Between 1989 and 1992, National Mineral Sands (SA) NL explored for heavy mineral sands over an area lying mainly west of the Nuckulla Hill Project. They reported low-grade concentrations, comprised mainly of magnetite.

exploration potential

Nuckulla Project has potential for structurally controlled gold deposits within the Yarlbrinda Shear Zone and for sedimentary uranium deposits in the Narlaby Palaeochannel. Past explorers have believed there may also be potential for IOCG style copper, gold and uranium mineralisation deposited in the preserved sub-volcanic igneous environment along the margin of the Gawler Range Volcanics.

The Nuckulla Hill Project covers almost 50 km of strike along the highly prospective Yarlbrinda Shear Zone, within the Central Gawler Craton Gold province. The Nuckulla Hill area was the site of the first gold discovery on the Yarlbrinda Shear Zone, made by Equinox Resources in 1995, when bedrock gold prospects were identified beneath saprolitic cover at Sheoak, Bimba and Myall Prospects. A subsequent discovery on the Yarlbrinda Shear Zone at Tunkillia, 50 km further north, is now in the resource definition stage. Minotaur Exploration Ltd has announced a JORL-compliant gold-silver resource containing 0.8 million ounces of gold at the Tunkillia 223 deposit, as discussed in the executive summary.

There has been little systematic gold exploration in the Nuckulla Hill Project since 1997, when the collapse of the gold price discouraged further work. Previous exploration in the 1990s defined widespread gold in calcrete anomalism along the shear zone, but less than 50% of the shear zone within the Project has been effectively explored and only a small proportion effectively drill tested, both along strike and at depth. Although past explorers drilled more than 600 holes, only about 20 of these reached more than 100 m depth.

The obvious calcrete anomalies were tested by drilling, but some structural targets, where calcrete sampling may not have been effective, were not followed up. New targets could be generated now, by taking advantage of recent experience at Tunkillia, where an improved understanding of calcrete geochemistry has been developed. This knowledge will provide Doray with an effective tool to target economic concentrations of gold beneath the relatively thin saprolite cover.

Not all the prospective structural zone is amenable to calcrete sampling. Of the 50 km of strike of the Yarlbrinda Shear Zone within the Project, about 30 km at the southern end is covered by sand dunes, whilst alluvial and lacustrine deposits cover the northernmost 10 km. The thin regolith profile and the presence of overlying transported material restrict geochemical dispersion to a narrow or non-existent halo, except close to bedrock mineralisation.

Experiences from the more recent exploration at Tunkillia provide guidelines for targeting structural traps. At Tunkillia higher grades are found associated with flexures in the main shear zone, in subsidiary structures, and at intersections with north-east trending structures. The presence of mafic dykes may also be important. Doray will be in a position to define new structural targets using detailed interpretations from existing aeromagnetic data, supplemented by appropriate new aeromagnetic coverage.

The Project also holds potential for discovery of sedimentary uranium deposits. A tributary of the Narlaby Palaeochannel System crosses the Project in northern Kondoolka licence (ELA 254/09). Work in the early 1980s established that the Narlaby System does host concentrations of uranium mineralisation, associated with redox fronts in the palaeochannel sands. This tributary was poorly defined until recently and is little explored. Toro (2005–2008) established the presence of a deep channel draining uraniferous source rocks, and identified target sections of the channel for investigative drilling. However, Toro withdrew from the project without undertaking the planned drilling, citing cost pressures.

Nuckulla Hill Project lies on the western margin of the Gawler Range Volcanics Domain, where a sub-volcanic, high-level igneous environment is preserved. This is a similar geological setting to the Olympic Dam IOCG deposit, which prompted past explorers to see potential for IOCG deposits in this region. However, recent researchers have tended to view this central Gawler region as a gold-only province, citing differences in the chemical composition of the Hiltaba Suite rocks in this zone from those further to the east in the Olympic Domain.

proposed exploration program

Doray intends to compile data from all previous exploration and re-interpret the existing detailed aeromagnetic data, which covers the central portion of the Project. Further detailed aeromagnetic surveys will cover the remaining strike length, following which Doray will select favourable structural settings for further targeting as potential sites for large high grade gold deposits.

To determine suitable analytical techniques for testing areas covered by sand dunes and lakes, Doray intends to undertake orientation geochemical sampling in those areas.


60

Drilling will include infill and deeper drill holes over the known gold prospects, as well as reconnaissance drill traverses across structural gold targets that were not tested previously.

The proposed budget for exploration on the Nuckulla Hill Project is $250,000 per year for the first two years. Doray may also seek joint venture partners to develop the sedimentary uranium prospectivity.

hicks anD kingoonya proJects

introduction

Hicks Project contains the Lake Labyrinth licence (ELA 169/09), which covers a 150 square kilometre area in the Harris Greenstone Domain, 5 km east of the old Lake Labyrinth Goldfield and 35 km north of the Glenloth Goldfield, in the central Gawler Craton of South Australia. Kingoonya Project contains the Centre Hill licence (EL 3529), which covers 147 square kilometres on the border between the Harris Greenstone Domain and The Gawler Range Volcanics Domain, 30 km south-east of Hicks Project and 35 km north-east of Glenloth Goldfield.

geological setting

The Hicks and Kingoonya Projects lie mainly in the Harris Greenstone Domain, an Archaean belt of ultramafic and mafic volcanics, aluminous metasediments and felsic igneous rocks, which comprise the oldest rocks of the region. Overlying the Archaean in both Projects are the more mafic to intermediate dominated lower Gawler Range Volcanics, of Mesoproterozoic age. Hiltaba Suite granitoids, which are co-magmatic with the Gawler Range Volcanics, intrude in the north-western section of Hicks Project.

Geological interpretations indicate that redbeds of the Pandurra Formation overlie the Gawler Range Volcanics at Kingoonya Project and in part of Hicks Project. The Pandurra Formation is made up principally of oxidised sandstones deposited in the Mesoproterozoic Cariewerloo Basin. Tertiary channels of the Kingoonya Palaeochannel System traverse the region and partly overlie sections of the Project areas.

Interpretation of aeromagnetic data shows the older basement rocks are cut by major fault systems, which tend to control the emplacement of greenstone bodies and granitoid intrusions.

Precambrian outcrop is sparse, largely concealed by a veneer of Quaternary aeolian sands, clays and playa lake sediments, as well as the Tertiary palaeochannels. In places there is also a thin cover of Jurassic sediments.


Since the first company exploration in 1977, several major companies have explored the Project areas for gold, base metals and uranium, including searches for IOCG deposits.

Dampier Mining Company Ltd (Dampier) explored an area lying mainly north and east of the Kingoonya Project in 1977-78, searching for Olympic Dam or Mount Gunson style deposits. Following ground magnetic and gravity surveys, Dampier drilled a single diamond hole (LY 1) to a depth of 675 m, sited about 25 km northeast of the Kingoonya Project area, to test a coincident gravity and magnetic anomaly. The hole did not reach magnetic basement, penetrating only redbeds of the Pandurra Formation for its entire length.

Amoco Minerals Australia Co. (Amoco) and several joint venture partners, including BHP Minerals Ltd (BHP) and CRA Exploration Pty Ltd, explored a large land package in the Kingoonya region between1979 and 1984, in search of stratiform base and precious metals or Olympic Dam style IOCG deposits. Amoco conducted detailed aeromagnetic and radiometric surveys plus ground magnetic and gravity surveys, prior to drilling 6 rotary percussion holes, to test 5 coincident gravity/magnetic anomalies. Hole KRP 2 was drilled in the Hicks Project area. Amoco concluded that the gravity anomalism reflected basic-intermediate volcanics, possibly associated with a major volcanic vent. BHP conducted a separate farm-in program exploring for diamonds in 1982-83. BHP identified 20 magnetic anomalies from re-processed aeromagnetic data and ground magnetic surveys, which they tested by drilling 38 RAB holes, without intersecting kimberlites. Three of the holes (PK6-PK8) were sited in Hicks Project.

Esso Exploration and Production Australia Inc. (Esso) explored for Olympic Dam style IOCG deposits from 1980 to 1983, covering an area mainly north, east and south of the Kingoonya Project. Esso conducted gravity, ground magnetic and EM depth sounding surveys, identifying a number of residual gravity anomalies. Depth to basement was interpreted as about 100 metres. However, Esso did not proceed to drill testing the gravity anomalies, citing failure to attract a joint venture partner to finance further work.

Between 1986 and 1990, CRA Exploration Pty Ltd (CRAE) explored for shallowly buried, intrusive-related epithermal or hydrothermal gold or base metal deposits, searching a large area that included Hicks Project. Uranium was also a target, either as possible Witwatersrand style gold-uranium deposits hosted by conglomerates of the Tarcoola Formation, or as possible Alligator River style hydrothermal uranium deposits associated with apparently disrupted aeromagnetic anomalies. CRAE carried out airborne magnetic and radiometric surveys, followed by gridded ground magnetic and gravity surveys, geological mapping, rock chip sampling and trenching. In addition, CRAE re-assayed


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historic bedrock and drill core samples for gold. Two inclined diamond holes tested a gravity-magnetic anomaly located 2 km north of Hicks Project. Results suggested that the anomaly is probably caused by mafic igneous rocks.

ACM Gold Operations Pty Ltd (ACM) explored around the old Lake Labyrinth gold workings 3 km west of Hicks Project in 1991, searching for gold and base metal deposits. Limited BLEG stream geochemical sampling detected weakly anomalous gold in watercourses draining known mineralised areas.

Dominion Gold Operations Pty Ltd (Dominion) explored for gold and copper in crystalline Precambrian basement throughout the region between 1992 and 1999, joining with several joint venture partners including Resolute Resources Ltd, Mount Isa Mines Ltd (MIM), Minotaur Operations Pty Ltd (Minotaur), BHP Billiton Minerals Pty Ltd (BHP Billiton) and Toro Energy Ltd (Toro). This exploration was part of the successful, ongoing programs that discovered the Challenger Gold Mine about 150 km to the northwest. Dominion still retain much of the ground under renewed exploration title, so publicly available information relates either to ground relinquished by Dominion or comes from authorised Data Releases.

Dominion and partners operated the Lake Labyrinth Join Venture over the current Hicks and Kingoonya Project areas, targeting deposits associated with Hiltaba Suite granitoids and in older mafic to ultramafic intrusions. Following interpretation of available aeromagnetic data to identify prospective structures, Dominion undertook regional calcrete sampling on 1.6 km spacing, with later infill sampling to confirm detected gold anomalies. Targeting of the gold-bearing Earea Dam fault system detected a gold anomaly at a prospect called North Hicks 2.

MIM subsequently farmed into the former EL 1955 and became the operator. After re-assessing the data, MIM carried out a regional power auger bedrock sampling program on a staggered 400 m x 400 m grid. Subsequent work focussed mainly on the North Hicks Prospect, where MIM drilled 35 aircore and percussion holes. Some of the deeper holes intersected the best mineralisation. Geological investigation showed that the gold mineralisation is associated with a 20 m wide quartz vein cutting chloritised Archaean gneiss on a WNW trend, accompanied by a parallel dolerite intrusion. Subsequent deeper RC drilling at North Hicks tested the correlation between low grade gold mineralisation and a low-order calcrete anomaly.

MIM subsequently searched for similar dilational zones, which might also host gold mineralisation, along the Kingsnag B North Hicks trend. Power auger bedrock and calcrete sampling detected only low-order gold anomalies. MIM also investigated the large Lake Labyrinth gravity anomaly, following up detailed gravity and magnetic surveys with a MIMDAS electrical geophysical survey. Gravity modelling indicated a deeper source body at more than 1,200 m depth and a shallower source coincident with the Kingsnag magnetic anomaly. However, resistivity and magnetotelluric data from the MIMDAS survey over Kingsnag were not encouraging and MIM withdrew from the Joint Venture.

Minotaur farmed into the Lake Labyrinth Joint Venture and assumed operation, focussing on possible IOCG targets. Together with BHP Billiton, Minotaur carried out detailed gravity infill surveys, which delineated 7 anomalies that were nominated as drill targets. Minotaur drilled 3 RC holes and 2 diamond holes to test residuals on the major 20-mgal Bouguer gravity feature. The drilling, to a maximum depth of 420 m, intersected deformed Palaeoproterozoic metasediments, but no evidence of IOCG mineralisation. The rocks intersected did not account for the regional gravity high, but Minotaur considered the probable source depth was too great to hold economic potential.

Minotaur subsequently conducted further regional and infill gravity surveys across the entire Join Venture area, defining gravity anomalies at Gosse North (2-3 mgal), Kingsnag East (2 mgal), Labyrinth South (5.5 mgal) and Labyrinth West (4 mgal). The Kingsnag East appeared to reflect shallow Wilgena Jaspilite banded iron formation (BIF). Minotaur drilled one RC hole at Labyrinth South, where the strongest gravity anomaly is flanked by strong magnetic anomalies, on the margin of the Harris Greenstone Belt. The hole intersected probable Archaean mafic rocks, which would account for the gravity anomaly.

In the western part of the Joint Venture area, Minotaur sought gold mineralisation related to Hiltaba Suite granite bodies along a N-S fault terminating the Harris Greenstone Belt. One hole yielded anomalous silver and two holes yielded anomalous rare earth elements (REE) in saprolitic granite.

In 2006, Minotaur associated company Toro Energy secured the uranium rights over the Lake Labyrinth Joint Venture area. A review of drill hole data revealed the presence of reducing carbonaceous material in sediments of the Kingoonya Palaeochannel. Toro drilled 31 aircore holes across the Palaeochannel headwaters to determine whether uranium is present in sufficient quantities to form economic concentrations. Drill cutting and groundwater samples yielded very low concentrations of uranium. Toro concluded that the degree of transport of uranium cations is too low to allow the formation of an economic uranium deposit, and withdrew from the Joint Venture.

Pima Mining NL (Pima) and joint venture partner Minotaur Gold NL explored for gold between 1996 and 1999, covering a wider area that included the western block of the Kingoonya Project. Pima, as operator, carried out regional calcrete sampling over the entire area, identifying several gold anomalies with values up to 17 ppb Au. Detailed infill sampling, involving auger drilling of calcrete, followed up 5 anomalous calcrete geochemical anomalies in their southern tenement (former EL 2174). At Rowes Tank, anomalous calcrete yielded Au Cu, possibly associated with dyke anomalous or shear structures and igneous intrusives, but arsenic values were low. Calcrete at Cooks Well yielded Au, Cu and As,


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possibly associated with a dyke or shear structure. There were several anomalous zones of Au, Cu and As at Paynters Well and at Paynters Well East. Auger sampling at Kingoonya Well did not identify any anomalous Au, Cu or As. Pima followed up 3 calcrete anomalies in their northern tenement (former EL 2253). Infill at Wallabyng defined an anomalous zone extending over a 5 km x 2 km area, but no significant arsenic. At Scotts Well (in the northern block of former EL 2253), peak values of 5 ppb Au and 18 ppm Cu were strongly correlated. Pima proposed further exploration at several prospects, including ground magnetic surveys and up to 70 RAB drill holes, but did not proceed with the work, possibly because of the substantial drop in the price of gold after October 1997.

Between 1996 and 1999, Goldstream Mining NL (Goldstream) operated a joint venture with Peninsula Exploration Pty Ltd to search for gold, covering a large tenement that included the eastern block of the Kingoonya Project. Regional Au and Cu calcrete sampling on a 1.6 km x 0.8 km grid returned anomalous gold results. Goldstream followed up with 12 RAB/aircore holes, assaying samples for Au, Ag, As and base metals. As the drill holes did not intersect recognisable crystalline basement rocks, the prospectivity of the tenement was significantly downgraded. Goldstream suggested that the anomalous gold in calcrete results could reflect detrital gold in the Pandurra Formation, which overlies basement in most of this former tenement.


Hicks and Kingoonya Projects have potential for structurally controlled gold deposits associated with granitic intrusives of the Hiltaba Suite. There may also be potential for IOCG style copper, gold and uranium mineralisation, related to high-level Hiltaba Suite intrusions in the sub-volcanic igneous environment preserved beneath the lower Gawler Range Volcanics.

The Hicks Project (ELA 169/09) straddles an interpreted north-west trending fracture system, which can be recognised in aeromagnetic imagery, and is referred to in various company reports as the Labyrinth Shear Zone. Gold mineralisation is spatially associated with this shear zone at Lake Labyrinth Goldfield 4 km west of Hicks Project, at North Hicks Prospect within the Project, and at KIN 27 Prospect 10 km east of Hicks Project.

Lake Labyrinth Goldfield was worked intermittently between 1912 and 1940, producing around 5 kg of gold from quartz veins in Archaean gneiss. KIN 27 Prospect was discovered more recently by Dominion and lies within ground still held by that company. Between those points, Dominion also intersected gold mineralisation at North Hicks Prospect in 1998, following up anomalous results from surficial calcrete geochemistry. Drilling intersection anomallous gold at shallow depths which has not been followed up. At Tunkillia and Nuckulla Hill, such coincident calcrete and RAB refusal gold anomalies are normally associated with bedrock gold mineralisation. There is no further drilling west of this line until the old Lake Labyrinth workings, which lie 10 km away along the strike of the shear zone. Near the eastern boundary of Hicks Project, apparently along strike to the north-west of KIN 27 Prospect, is an untested calcrete anomaly.

In Kingoonya Project there are a number of WNW-trending calcrete anomalies, some more than 2 km long. The only previous drill testing of these anomalies was limited and did not reach crystalline basement beneath interpreted Pandurra Formation. If present, the Pandurra could be quite thin here, so these anomalies could warrant further investigation. Proprietary data from enzyme leach sampling suggests there may be westerly or west-northwest trending structures associated with some of the calcrete anomalies.

A Hiltaba Suite granite intrusion beneath western Hicks Project represents a potential source of mineralising bearing fluids. A layer of Gawler Range Volcanics covers the Lake Labyrinth Shear zone where it cuts the underlying Archaean rocks and the volcanics could have acted as a confining layer, funnelling and concentrating mineralising fluids derived from the granite to create an ideal environment for the deposition of large, fracture-controlled gold deposits within the Labyrinth Shear Zone.

This environment may also be prospective for IOCG style copper, gold and uranium deposits.

Hicks and Kingoonya Projects lie on the northern margin of the Gawler Range Volcanics Domain, where a sub-volcanic, high-level igneous environment is preserved. This is a similar geological setting to the Olympic Dam IOCG deposit, which prompted past explorers to see potential for IOCG deposits in this region. However, the Doray Projects straddle the margin of the Central Gawler Gold Province, which recent researchers have tended to view as a gold-only province, citing differences in the chemical composition of the Hiltaba Suite rocks in this zone from those further to the east in the Olympic Domain.

Interpretation of aeromagnetic imagery indicates that the faults of the Labyrinth Shear Zone persist in a south-easterly direction through the Kingoonya Project, where the geological setting is similar to that in Hicks Project and holds similar potential for gold and IOCG mineralisation.

The Kingoonya Palaeochannel System has potential for deposits of sedimentary uranium. Investigation of the palaeochannel for uranium is subject to a separate joint venture agreement between the licence holder for EL 3529 (Venture Minerals Ltd) and another company.


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Doray intends to compile the data from all previous exploration in the Hicks and Kingoonya Projects and then fly a detailed aeromagnetic survey over the Hicks Project. The survey is proposed to follow north-south oriented flight lines, spaced 100-200 m apart. Geochemical sampling will test enzyme leach and other methods over interpreted basement structures, with the aim of targeting potential gold-bearing structures for drill follow-up.

At Hicks Project, RC drilling will further investigate indications of significant gold mineralisation at North Hicks Prospect, and possible extensions along the Labyrinth Shear Zone.

Under the terms of a farm-in agreement, Mega Uranium Ltd (Mega Uranium) is earning a 51% interest in the uranium content in EL 3529 (Kingoonya Project), through expenditure on exploration up to June 2011. The joint venture partners Mega Uranium and Venture Minerals Ltd propose to spend $45,000 per year for the first two years. The work will include exploration for sedimentary uranium mineralisation in the Kingoonya Palaeochannel, and will meet government expenditure commitments for EL 3529. Planned work includes a regional geochemical sampling survey, to be followed by infill sampling and shallow drilling.

harris Bluff proJect

introduction

This Project includes Harris Bluff (EL 3580), which covers 167 square kilometres on the southern margin of the Gawler Range Volcanics Domain, midway between the IOCG-related silver-lead-zinc-gold deposit at Menninnie Dam and the epithermal gold-silver-lead-zinc deposit at Parkinson Dam, both of which lie in the same general geological setting as Harris Bluff.

geological setting

The oldest rocks in the Project area are syntectonic Palaeoproterozoic granitoids of the Lincoln Complex. Overlying in the north-west of the Project is an outlier of the Mesoproterozoic sandstones and conglomerates known as the Corunna Conglomerate. The north-eastern part of the Project area extends onto the lower Gawler Range Volcanics, a sequence of generally mafic to intermediate rocks, also of Mesoproterozoic age, which appear to be partly intercalated with the Corunna Conglomerate. The contact between the volcanics and the older granitoid rocks is a major east-west trending structure, the Uno Fault. Major NW and NE trending faults are also apparent from interpretation of aeromagnetic imagery.

Coeval with the Gawler Range Volcanics are Mesoproterozoic Hiltaba Suite intrusives, the broad group of mainly granitoid rocks responsible for IOCG mineralisation at Olympic Dam and Prominent Hill and Carrapateena. Although not evident in the Project area, Hiltaba Suite rocks outcrop in the wider region and are believed to be responsible for the IOCG-related mineralisation at Menninnie Dam and the epithermal deposits at Parkinson Dam.

Bedrock is obscured in much of the area by Quaternary sediments and calcrete, including the playa lake sediments of Lake Gilles in the southern part of the Project.


Since 1969, explorers have targeted base metal and gold deposits, including stratabound lead-zinc and IOCG deposits, and uranium mineralisation. Discoveries during that time include the Menninnie Dam silver-lead-zinc-gold deposit, 30 km to the west, and the Parkinson Dam epithermal gold-silver-(lead-zinc) deposit, 35 km to the east, as well as several other base and precious metal prospects.

Base Metals and Gold (Including IOCG)

Asarco (Australia) Pty Ltd (Asarco) explored throughout the Harris Bluff Project area in 1969-70, seeking base metal sulphide deposits associated with linear iron-rich outcrops. Work included geological mapping, trenching of inferred gossans, and 13 angled rotary percussion holes, drilled beneath trenched gossans where significant base metal anomalies were detected in costean walls. The proposed drilling program proved impossible to complete with the available equipment, because of the shallow water table proximal to Lake Gilles. The gossanous material apparently does not persist at depth, where sulphides are absent and metal assay values decrease sharply.

At Margoon Dam area, covering the northern part of the Project area, Asarco investigated a 16 kilometre long zone of interpreted intense hydrothermal alteration, along the Uno Fault in Gawler Range Volcanics. Work included stream sediment and rock chip sampling and petrological studies. Asarco found the alteration is concentrated along two linear zones in Gawler Range Volcanics, and is accompanied by intense silicification but no base metal mineralisation.

Murumba Minerals NL (Murumba) explored an area mainly south-west of the Project in 1970-71, searching for base metal sulphide deposits associated with an elongated magnetic anomaly. This anomaly lay to the west of Gossan B5 located earlier by Asarco at Lake Gilles prospect. Two rotary diamond holes intersected highly altered chemical sediments that had no magnetic character and contained no primary sulphide mineralisation.


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Esso Exploration and Production (Australia) Inc. (Esso) targeted the area between 1980 and 1985, initially for uranium and then for BIF-related base metals. From 1980 to 1983, Esso searched for uranium, conducting a spectrometer survey and drilling one percussion hole. Review and follow-up of previous work by Asarco convinced Esso of the base metal potential of the area. Esso entered a joint venture with Pegmin Ltd (Pegmin) and Otter Exploration NL (Otter) to explore for base metals. From 1983 to 1985, Pegmin and Otter managed the joint venture. A review of data suggested there was potential for BIF-associated base metal deposits of the type found at Aggeneys, in South Africa. Work included rock chip and soil sampling at Pier Dam and Lake Gilles South, mapping and sampling of a large ironstone outcrop near Jungle Dam, auger drilling at Lake Gilles South and Pier Dam, and ground magnetics at Lake Gilles South. Whilst the exploration outlined some zones with elevated base metal and barium levels, Pegmin and Otter concluded that these are of dubious significance, and possibly related to concentration in the weathering profile or scavenging by manganese, and withdrew from the joint venture.

Aberfoyle Resources Ltd (Aberfoyle) then farmed into Esso’s ground and assumed management at the end of 1985. Aberfoyle targeted Menninnie Dam style lead-zinc sulphide mineralisation, which was apparently associated with magnetic iron formations. Aberfoyle defined 5 linear magnetic anomalies from aeromagnetic data, and then ran ground magnetic and EM surveys to define targets, before drilling 693 RAB holes and 11 RC holes. Aberfoyle also conducted rock chip, stream sediment and soil sampling. This work defined an extensive zone of anomalous base metals in BIF of the Palaeoproterozoic Hutchison Group, west of Lake Gilles. Rock chip samples from Lake Gilles South prospect yielded anomalous Cu, Zn and Pb. Drilling at Line C and Mitchell prospects yielded anomalous Pb and Zn, as well as intercepts of abundant fine-grained graphite. RAB drilling at Line C prospect returned assays anomalous Pb and Zn. Further drilling and geophysical surveys appeared to be warranted, but Aberfoyle withdrew from the joint venture and the ground was relinquished.

Esso also explored for base metals in the Uno area between 1980 and 1982, in a joint venture with Wyoming Mineral Corp. Following an unsuccessful search for unconformity-related uranium deposits (discussed later), Esso switched the focus in 1981 to search for base metal deposits associated with the BIFs of the Palaeoproterozoic Hutchison Group. After reviewing previous exploration data, Esso conducted a drill-based rock chip sampling program, to determine background geochemical values. Esso also interpreted aeromagnetic data, to identify potential quartz-magnetite BIF horizons for drill follow-up. RAB drilling (289 holes) followed by ground truthing and geochemical survey of three priority targets showed that the anomalies were caused by mafic igneous rocks, not by BIF horizons.

The Shell Co. of Australia Ltd (Shell) explored for base metals and gold north of Lake Gilles from 1982 to 1986. Shell targeted stratabound lead-zinc deposits associated with the BIF metasediments of the Palaeoproterozoic Hutchison Group, similar their discovery at Menninnie Dam, 30 km to the west. Shell also looked for gold deposits in Palaeoproterozoic conglomerates. After compiling geological data and aeromagnetic contours from the work of previous companies, Shell undertook geological mapping, ground magnetic surveys and the collection of rock chip, soil and stream sediment samples. That work identified 4 anomalous areas. Follow-up investigations included 76 RAB drill holes, re-logging of 2 historic drill cores, and detailed mapping of the 4 anomaly grids. Shell also carried out moving and fixed loop SIROTEM surveys, followed by 2 percussion drill holes on the strongest TEM anomalies at Triumph prospect. Hole PDH HB1 intersected conductive pyritic black shale. Hole PDH HB2 intersected moderately geochemically anomalous dolerite Pb and Zn in percussion drilling samples. In what may have been the first modern gold exploration on upper Eyre Peninsula, Shell re-assayed stored samples from prior work by Stockdale Prospecting and Esso, as well as some soil samples collected over the Mesoproterozoic Corunna Conglomerate.

Pondray Pty Ltd (Pondray) and various joint venture partners explored for base metals and gold across a wider area that included most of the Harris Bluff Project, from 1988 to 2004. The initial target was Menninnie Dam style lead-zinc mineralisation. Pondray followed ground magnetic surveys with 302 holes of auger drilling, plus lag, BLEG and soil sampling. The work defined targets at Wartaka and Morgans, which Pondray investigated with ground magnetic surveys, soil and rock chip sampling, and 172 holes of RAB drilling. Follow-up drilling of 7 RC holes at Morgans, Morgans East and Wartaka returned weakly elevated base metal values. Three diamond core holes and extensive rock chip sampling returned similar results. Grenfell Resources NL (Grenfell) farmed in and shifted the focus to gold exploration. Calcrete sampling at 800 m centres defined 4 anomalies in the northern part of the area, where Grenfell infilled with detailed calcrete sampling. An interest in the potential for IOCG mineralisation led to definition of an area of weakly anomalous Au-Cu calcrete geochemistry in the north of the area, coincident with significant magnetic and gravity anomalies. These zones of interest were retained under renewed tenure.

Minotaur Gold NL (Minotaur) and partner Aurora Gold (WA) Pty Ltd explored for base metals and IOCG style deposit from 1997 to 2001, covering an area mainly west of the Project, but extending across the southern part of EL 3582. Regional calcrete sampling identified two anomalous zones of gold and silver, one near the faulted southern margin of the Gawler Range Volcanics, and the other as an extension of the Telephone Dam prospect. Infill calcrete and soil sampling plus ground magnetic surveys generated further drill targets. Visible gold was recorded in one rock sample. Minotaur drilled 9 RAB and 38 aircore holes, which yielded only low-order gold and anomalous lead.

In 2006, the Department of Primary Industry and Resources (PIRSA) completed the PACE-funded Southern Stuart Shelf Gravity Survey, which included most of the Harris Bluff Project, collecting data at 2 x 2 km centres.


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Uranium

Nissho-Iwai Co. (Australia) Pty Ltd (Nissho-Iwai) explored for uranium on Uno Station from 1970 to 1972, following up their earlier discovery of a strong surface thorium anomaly associated with sediments of the Mesoproterozoic Corunna Conglomerate. The surface thorium anomaly could be traced for 14 km along the Uno Range, following a 40 m thick horizon. Work included a ground radiometric survey, geological mapping, rock chip, stream, soil and lake bed geochemical sampling, trenching and sampling of radiometric anomalies, groundwater sampling and petrographic studies. Nissho-Iwai drilled 6 diamond holes to test the un-oxidised target beds at depth. Drilling intersected mineralised conglomerate and sandstone beds, which were between 2 m and 7 m thick. Downhole radiometric logs peaked at 21000 counts per minute.

In 1976-77, Nissho-Iwai explored for sedimentary uranium, mainly east of Lake Gilles, investigating a palaeochannel discovered by SA Department of Mines geophysical surveys in their former EL 145. Following a ground radiometric survey, Nissho-Iwai drilled 13 rotary holes (one in EL 3580) and 2 diamond drill holes, to test the palaeochannel sediments. Three holes intersected weak radiometric anomalies in weathered basement or overlying lake sediments. Nissho-Iwai attributed the radiometric anomalies to thorium.

Wyoming Mineral Corp. (Wyoming) and Esso explored for uranium near Lake Gilles from 1978 to 1980, targeting Alligator River style deposits associated with the unconformity contact between Palaeoproterozoic basement of the Cleve Metamorphics and Mesoproterozoic sandstones and conglomerates of the Corunna Conglomerate. Following an airborne magnetic survey made to elucidate structures in concealed basement, Wyoming conducted extensive regional RAB drilling (293 holes; 62 within EL 3580) to investigate basement, together with geological mapping and ground follow-up of radiometric and magnetic anomalies.

In 1979, Esso farmed into the Wyoming ground and assumed management of the project. Esso undertook a helicopter radiometric survey, various geochemical, petrological, thermoluminescence and lead isotope studies, then drilled 166 RAB holes to test the concealed basement. However, the uranium search provided no encouragement and Esso switched the focus to exploration for base metals (discussed previously).

In 1978-79, Pancontinental Mining Ltd (Pancontinental) managed a joint venture with Power Reactor and Nuclear Fuel Development Co., to explore for unconformity-vein style uranium mineralisation south of Nonning. The area covered included only the most southern part of EL 3580. Pancontinental conducted geological mapping, geochemical sampling and reconnaissance ground radiometric surveys. Investigations revealed the absence of the hoped-for Mesoproterozoic sandstones unconformably overlying the Palaeoproterozoic basement, which downgraded the potential for unconformity-related uranium deposits. Pancontinental attributed any uranium anomalies that had been detected to scavenging of uranium by iron or manganese.


Harris Bluff Project has potential for lead-zinc-precious metal deposits similar to those found in a similar geological setting at Menninnie Dam (30 km to the west) and epithermal gold-silver deposits similar to those found in a similar setting at Parkinson Dam (35 km to the east).

Harris Bluff Project lies on the southern margin of the Gawler Range Volcanics Domain, in a transitional area between the Central Gawler Gold Province to the west and the Olympic (IOCG) Domain to the east. Investigation of the lead-zinc, silver and gold deposits at Menninnie Dam, Telephone Dam and Weednanna Prospects, which lie immediately to the west, indicate that mineralisation is related to an unseen igneous intrusion called the Wilcherry Complex, the presence of which is interpreted from gravity and magnetic geophysical data. The intrusion is interpreted as part of the Mesoproterozoic Hiltaba Suite and the style of the mineralisation suggests it is IOCG-related. The location of the mineralisation on the margin of the Gawler Range Volcanics Domain, where a former sub-volcanic igneous environment is preserved, supports this interpretation.

At Parkinson Dam Prospect, Gawler Range Volcanics are intercalated with beds of the Corunna Conglomerate, which hosts epithermal vein mineralisation related to high-level sub-volcanic igneous activity. A similar geological setting may occur at Harris Bluff Project, where Corunna Conglomerate abuts the lower Gawler Range Volcanics. Other prospects in a similar setting include Triumph (Ag) and Wartaka (Pb-Zn-Ag).

Major faults trend north-west and north-east through the Palaeoproterozoic basement in the Project and can be traced extending beneath the Gawler Range Volcanics. These structures are also potential sites for deposition of structurally controlled precious metal deposits associated with high-level Hiltaba Suite magmatism. Crossing the northern part of the Project is a major east-west trending structure, the Uno Fault, which forms the southern margin of the Gawler Range Volcanic province. At Uno Prospect, located immediately west of Harris Bluff Project, anomalous gold and base metal concentrations have been found within the Uno Fault zone, in a setting consistent with epithermal vein style mineralisation.


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Research published by PIRSA indicates that both the Menninnie Dam and Parkinson Dam deposits lie within areas of anomalous groundwater geochemistry. This suggests there is an opportunity to further assess the potential of the Harris Bluff area by sampling groundwater from the several bores dotting the region.

An outlier of Corunna Conglomerate outcrops in the Harris Bluff Project. In the past, this Mesoproterozoic geological unit has been the target for uranium exploration, and it remains a target for current explorers.


After compilation of data from all previous exploration, Doray proposes to undertake programs of geological mapping and rock chip sampling, in search of epithermal gold or base metal mineralisation. This work will be accompanied by orientation geochemical surveys to determine the optimal sampling technique to evaluate the more prospective areas.

Under the terms of a farm-in agreement, Mega Uranium is earning a 51% interest in the uranium content in EL 3580, through expenditure on exploration up to June 2011. Proposed expenditure by joint venture partners Mega Uranium and Venture Minerals Ltd is $45, 000 per year for the first two years. This will meet the government expenditure commitments for EL 3580. Mega Uranium will explore for uranium mineralisation associated with the Corunna Conglomerate. The Company plans to interpret and conduct ground follow-up of an airborne electromagnetic survey (AEM). The work will also include field investigation and mapping, regional geochemical sampling, and drilling.

principal sources of informationThe sources of information for this report include published research papers, unpublished PIRSA open file reports, confidential company reports provided by Doray Minerals Limited, and my own professional experience working in the areas covered by the report. Selected published references are listed below.

selecteD puBlisheD referenceschen, x.y., lintern, m.J. and roach, i.c. (editors), 2002. Calcrete: characteristics, distribution and use in mineral exploration. Cooperative

Research Centre for Landscape Environments and Mineral Exploration.

cooper, B.J. and mcgeough, m.a. (eds), 2006. South Australia mineral explorers guide. Second edn. South Australia. Department of Primary Industries and Resources. Mineral Exploration Data Package, 11 (DVD).

cowley, W.m. (compiler), 2005. Solid geology of South Australia. South Australia. Department of Primary Industries and Resources. Mineral Exploration Data Package, 15.

Drexel, J.f., preiss, W.v., and parker, a.J., 1993. The geology of South Australia, Vol. 1, The Precambrian, South Australia. Department of Primary Industry and Resources. Geological Survey, Bulletin 54.

ferris, g.m., schwarz, m.p., and heithersay, p., 2002. The geological framework, distribution and controls of Fe-oxide and related alteration, and Cu–Au mineralisation in the Gawler Craton, South Australia: Part I: geological and tectonic framework. In: Porter, T.M., (Ed.), Hydrothermal iron oxide copper–gold and related deposits: a global perspective. Vol. 2. PGC Publishing, Adelaide.

ferris, g.m., and schwarz, m.p., 2003. Proterozoic gold province of the central Gawler Craton. South Australia. Department of Primary Industry and Resources. MESA Journal 30: 4-12.

geological survey of south australia, 2004. South Australia Geoscientific GIS Dataset, South Australia. Department of Primary Industry and Resources. December 2006 release CD.

gray, D.J., 2006. Data release: heliborne gravity survey, southern Stuart Shelf region. South Australia. Department of Primary Industry and Resources. MESA Journal 42: p. 41.

morris, B.J., 2008. Matching mineral discoveries to hydrogeochemistry: evidence from the 1979–80 state survey. MESA Journal 49:13-15.

reynolds, l.J., 2001. Geology of the Olympic Dam Cu-U-Au-Ag-REE deposit. MESA Journal 23:4-11.

skirrow, r.g., Bastrakov, e., Davidson, g., raymond, o.l., and heithersay, p., 2002. The geological framework, distribution and controls of Fe-oxide and related alteration, and Cu–Au mineralisation in the Gawler Craton, South Australia: Part II: alteration and mineralisation. In: Porter, T.M., (Ed.), Hydrothermal iron oxide copper–gold and related deposits: a global perspective. Vol. 2. PGC Publishing, Adelaide.

thomas, m., 2004. Central Gawler gold data catalogue. South Australia. Department of Primary Industry and Resources. Report Book 2004/4.

Wall, v.J., 2005. TAG: thermal aureole (pluton-related) gold systems. AIG News, 79.

youles, i.p., 1991. Review of Mineral Exploration, Tarcoola Region. South Australia. Department of Mines and Energy. Report Book, 1991/105.


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283 Rokeby Road, Subiaco Western Australia 6008 p: +61 (08) 9426 0666 f: +61 (08) 9481 1947 e: [email protected].

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8. material contractsSet out below are summaries of the contracts to which the Company is a party and which are or may be material in terms of the Offer or the operations of the Company or otherwise are or may be relevant to an investor who is contemplating the Offer.

To fully understand all rights and obligations in the material contracts it is necessary to read them in full. A copy of each of these contracts may be inspected during normal business hours at the registered office of the Company.

8.1 agreements affecting the tenements

A summary of each of the agreements affecting the Tenements, including but not limited to the agreements the Company has entered into to acquire the Tenements described in this Prospectus are summarised in Part II of the Solicitors Report on Tenements in Section 7 of this Prospectus.

8.2 sponsoring Broker agreement

By letter agreement dated 20 November 2009 from Shaw Stockbroking Limited (“shaw”) has agreed to act as sponsoring broker to the Offer and to use its reasonable endeavours to place Shares under this Prospectus.

The Company has agreed to pay Shaw a sponsoring broker fee of 5% and a management fee of 1% of the capital raised. The Company has also agreed to grant Shaw or its nominee the following Options:

• 1 million Options in the Company should Shaw raise $4,000,000 for the Company; or

• 2 million Options in the Company should Shaw raise $6,000,000 for the Company; or

• 3 million Options in the Company should Shaw raise $8,000,000 for the Company;

with an exercise price of $0.20 each exercisable at any time prior to 3 September 2014 and otherwise on the terms and conditions set out in Section 9.5(c) of this Prospectus.

Where the amount raised falls between the amounts raised for the Company the total number of Options issued will be calculated pro rata.

8.3 inDemnity, insurance anD access DeeD

The Company has entered an into Indemnity, Insurance and Access Deed with each Director.

Pursuant to the Deed:

The Director is indemnified by the Company against any liability incurred in that capacity as an officer of the Company to the maximum extent permitted by law subject to certain exclusions.

The Company must keep a complete set of company documents until the later of:

• the date which is seven years after the Director ceases to be an officer of the Company; and

• the date after a final judgment or order has been made in relation to any hearing, conference, dispute, enquiry or investigation in which the Director is involved as a party, witness or otherwise because the Director is or was an officer of the Company (“relevant proceedings”).

The Director has the right to inspect and/or copy a company document in connection with Relevant Proceedings during the period referred to above.

Subject to the next sentence, the Company must maintain an insurance policy insuring the Director against liability as a director and officer of the Company while the Director is an officer of the Company and until the later of:

• the date which is seven years after the Director ceases to be an officer of the Company; and

• the date any Relevant Proceedings commenced before the date referred to above have been finally resolved.

The Company may cease to maintain the insurance policy if the Company reasonably determines that the type of coverage is no longer available.

The Deed is governed by the laws of Western Australia.


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8.4 DeeD of employment With managing Director On 10 November 2009, the Company entered into a service agreement with Allan Kelly (service agreement) effective from the date of official quotation of the Shares on ASX. Under the Service Agreement, Mr Kelly is engaged by the Company to provide services to the Company in the capacity of Managing Director. Mr Kelly is to be paid an annual salary of $150,000 per annum plus superannuation. Mr Kelly will also be reimbursed reasonable expenses.

The Service Agreement continues for a period of 3 years, unless otherwise extended or terminated in accordance with its terms. Mr Kelly will have an annual pay review. If the service agreement is terminated by the Company Mr Kelly will be given 3 months notice of termination. If the Service Agreement is terminated due to specified misconduct, for reasons of bankruptcy, death or if otherwise removed from office under the Corporations Act or the Company’s Constitution, then Mr Kelly is only entitled to unpaid remuneration and entitlements.

8.5 service agreement With xgs exploration geochemistry servicesOn 10 November 2009, the Company entered into a service agreement with XGS Exploration Geochemistry Services (xgs), a company related to Mr Allan Kelly (service agreement) effective from the date of official quotation of the Shares on ASX. Under the Service Agreement, XGS is engaged by the Company to provide specialist exploration geochemical services. XGS will be paid $3,000 per month plus GST and will be reimbursed reasonable expenses.

The Service Agreement continues for a period of 3 years, unless otherwise extended or terminated in accordance with its terms. The Service Agreement can be terminated at 3 months notice by either party.

8.6 service agreement With neogolD enterprises pty ltD On 10 November 2009, the Company entered into a service agreement with Neogold Enterprises Pty Ltd (“neogold”), a company related to Mr Heath Hellewell (service agreement) effective from the date of official quotation of the Shares on ASX. Under the Service Agreement Neogold is engaged by the Company to provide services to the Company in the capacity of Technical Director. Neogold is to be paid a daily rate of $800 per day for a minimum of 100 days work per year and maximum of 200 days per year. Neogold will also be reimbursed reasonable expenses.

The Service Agreement continues for a period of 3 years, unless otherwise extended or terminated in accordance with its terms. The Service Agreement can be terminated at 3 months notice by either party.

8.7 service agreement With Wolfstar group pty ltDOn 12 August 2009, the Company engaged Wolfstar Group Pty Ltd (“Wolfstar group”) for the period of six months (or such longer period as the parties may agree) from 12 August 2009 to act as manager of its initial public offering, and to provide financial and corporate advice and assistance in connection with the Offer. Wolfstar Group is a related party of the Company by virtue of it being controlled by Brett Fraser and Jay Stephenson (both Directors of the Company).

In consideration for the services provided, Wolfstar Group is entitled to the following fees:

(a) a monthly retainer of $6,000 (plus GST) for a maximum of four months prior to the Offer;

(b) work fees of 1.5% of the total capital raised under the Offer payable on admission of the Company to the Official List; and

(c) ongoing Company Secretarial and accounting and financial support services fees of $7,500 per month for the first 12 months following the admission to the Official List.

The Company will reimburse Wolfstar Group for all reasonable out-of-pocket expenses incurred including, but not limited to, printing, courier, and travel, and of any other advisers and consultants which may be required.


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9 aDDitional information

9.1 tax status anD financial yearThe Company is taxed in Australia as a public company. The financial year of the Company ends on 30 June annually.

9.2 corporate governance The Board of Directors of Doray will be responsible for the corporate governance of the Company including its strategic development. The format of this Section is guided by the ASX Corporate Governance Council’s (“Council”) best practice recommendations (“Recommendations”). The Company’s corporate governance principles and policies are therefore structured as follows:

1. Lay solid foundations for management and oversight;

2. Structure the Board to add value;

3. Promote ethical and responsible decision-making;

4. Safeguard integrity in financial reporting;

5. Make timely and balanced disclosure;

6. Respect the rights of shareholders;

7. Recognise and manage risk;

8. Remunerate fairly and responsibly.

With the exception of the departures from the Recommendations in relation to the establishment of a nomination committee and that management report in writing to the Board regarding the integrity of the Company’s financial reports as detailed below, the corporate governance practices of Doray are compliant with the Council’s best practice recommendations.

9.2 (a) Board responsibilities

The Board will be accountable to the Shareholders for the performance of the Company and will have overall responsibility for its operations. Day to day management of the Company’s affairs, and the implementation of the corporate strategy and policy initiatives, will be formally managed by Mr Allan Kelly, Managing Director and Mr Brett Fraser, Chairman of the Board.

The key responsibilities of the Board will include:

• approving the strategic direction and related objectives of the Company and monitoring management performance in the achievement of these objectives;

• adopting budgets and monitoring the financial performance of the Company;

• overseeing the establishment and maintenance of adequate internal controls and effective monitoring systems;

• overseeing the implementation and management of effective safety and environmental performance systems;

• ensuring all major business risks are identified and effectively managed; and

• ensuring that the Company meets its legal and statutory obligations.

For the purposes of the proper performance of their duties, the Directors are entitled to seek independent professional advice at Doray’s expense, unless the Board determines otherwise. The Board schedules meetings on a regular basis and other meetings as and when required.

9.2 (b) size and composition of the Board

The Directors consider the size and composition of the Board is appropriate given the size and status of the Company. However, the composition of the Board will be subject to review in a number of ways.

• The Constitution provides that at every annual general meeting, one third of the Directors shall retire from office but may stand for re-election.

• Board composition will also be reviewed periodically either when a vacancy arises or if it is considered the Board would benefit from the services of a new Director, given the existing mix of skills and experience of the Board, which should match the strategic demands of the Company. Once it has been agreed that a new Director is to be appointed, a search will be undertaken, sometimes using the services of external consultants. Nominations would then be received and reviewed by the Board.


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9.2 (c) ethics and independence

The Board recognises the need for Directors and employees to observe the highest standards of behaviour and business ethics when engaging in corporate activity. Doray intends to maintain a reputation for integrity. The Company’s officers and employees are required to act in accordance with the law and with the highest ethical standards.

The Board is conscious of the need for independence and ensures that where a conflict of interest may arise, the relevant Director(s) leave the meeting to ensure a full and frank discussion of the matter(s) under consideration by the rest of the Board. Those Directors who have interests in specific transactions or potential transactions do not receive Board papers related to those transactions or potential transactions, do not participate in any part of a Directors’ meeting which considers those transactions or potential transactions, are not involved in the decision making process in respect of those transactions or potential transactions, and are asked not to discuss those transactions or potential transactions with other Directors.

Recommendation 2.1 requires a majority of the Board to be independent Directors. In addition, Recommendation 2.2 requires the chairperson of the Company to be independent. The Council defines independence as being free from any business or other relationship that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of unfettered and independent judgement. In accordance with this definition, Messrs Fraser and Stephenson are considered to be independent.

Doray considers industry experience and specific expertise to be important attributes of its Board members and therefore believes that the composition of the Board is appropriate given the size and development of the Company at the present time.

9.2 (d) Board committees

It is the role of the Board to oversee the management of the Company and it may establish appropriate committees to assist in this role. The composition of the committees shall be as follows:

• the majority of the members of each committee of the Board will be non-executive Directors;

• each committee will have a charter approved by the Board; and

• each committee will maintain minutes of each meeting of the committee, which will be circulated to all Directors.

The Board will initially establish an audit, risk and compliance committee. At the present time no other committees will be established because of the size of the Company and the involvement of the Board in the operations of the Company. The Board takes ultimate responsibility for the operations of the Company including remuneration of Directors and executives and nominations to the Board.

Audit, Risk and Compliance Committee

The audit committee will initially be comprised of Messrs Fraser and Stephenson each of whom is a non-executive Director and free from any relationships which might, in the opinion of the Board, be construed as a conflict of interest. The Board will annually confirm the membership of the committee.

As noted above, Messrs Fraser and Stephenson are considered as independent when applying the Council’s definition of independence.

The committee’s primary responsibilities are to:

• oversee the existence and maintenance of internal controls and accounting systems;

• oversee the management of risk within the Company;

• oversee the financial reporting process;

• review the annual and half-year financial reports and recommend them for approval by the Board of Directors;

• nominate external auditors;

• review the performance of the external auditors and existing audit arrangements; and

• ensure compliance with laws, regulations and other statutory or professional requirements, and the Company’s governance policies.

The size and nature of the activities of the Company does not presently require the services of a chief financial officer. It is proposed that the Company Secretary, Mr Jay Stephenson will initially provide accounting and financial support to the Company. Mr Stephenson will be required to state in writing to the Board that the Company’s financial reports present a true and fair view, in all material respects, of the Company’s financial condition and operational results are in accordance with relevant accounting standards. Included in this statement will be confirmation that the Company’s risk management and internal controls are operating efficiently and effectively.


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9.2 (e) shareholder communication

The Board strives to ensure that Shareholders are provided with sufficient information to assess the performance of the Company and its Directors and to make well-informed investment decisions. Information is communicated to Shareholders through:

• annual and half-yearly financial reports and quarterly reports;

• annual and other general meetings convened for Shareholder review and approval of Board proposals;

• continuous disclosure of material changes to ASX for open access to the public; and

• the Company maintains a website where all ASX announcements, notices and financial reports are published as soon as possible after release to ASX.

The auditor is invited to attend the annual general meeting of Shareholders. The Chairman will permit Shareholders to ask questions about the conduct of the audit and the preparation and content of the audit report.

9.2 (f) identification and management of Business risk

The Board has identified the significant areas of potential business and legal risk of Doray. The identification, monitoring and, where appropriate, the reduction of significant risk to Doray will be the responsibility of the Board.

The Board reviews and monitors the parameters under which such risks will be managed. Management accounts will be prepared and reviewed at subsequent Board meetings. Budgets are prepared and compared against actual results.

9.2 (g) remuneration

The Chairman and the non-executive Directors are entitled to draw Directors fees and receive reimbursement of reasonable expenses for attendance at meetings. The Company is required to disclose in its annual report details of remuneration to Directors. The maximum aggregate annual remuneration which may be paid to non-executive Directors is $250,000. This amount cannot be increased without the approval of the Company’s Shareholders. A detailed explanation of the basis and quantum of Directors remuneration is set out in Section 9.7 of this Prospectus.

9.2 (h) securities trading Disclosure

The Company has a formal policy for dealing in the Company’s securities by Directors, employees and contractors. This sets out their obligations regarding disclosure of dealing in the Company’s securities. The Constitution permits Directors to acquire securities in the Company, however Company policy prohibits Directors and senior management from dealing the Company’s securities at any time whilst in possession of price sensitive information and for 24 hours after:

• any major announcements;

• the release of the Company’s annual and half yearly financial results to the ASX; and

• the annual general meeting.

Directors must advise the Chairman of the Board before buying or selling securities in the Company. All such transactions are reported to the Board. In accordance with the provisions of the Corporations Act and the Listing Rules, the Company advises ASX of any transaction conducted by Directors in the securities of the Company.

9.3 litigationThe Directors are not aware of any legal proceedings which have been threatened or actually commenced against the Company.

9.4 rights attaching to sharesThe Shares to be issued under this Prospectus will rank equally with the issued fully paid ordinary Shares in the Company. The rights attaching to Shares are set out in the Company’s Constitution and, in certain circumstances, are regulated by the Corporations Act, the Listing Rules and general law.

The following is a summary of the more significant rights of the holders of Shares of the Company. This summary is not exhaustive nor does it constitute a definitive statement of the rights and liabilities of the Company’s members.

• General Meeting

Each member is entitled to receive notice of, and to attend and vote at, general meetings of the Company and to receive all notices, accounts and other documents required to be sent to members under the Company’s Constitution, the Corporations Act or the Listing Rules.


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• Voting

Subject to any rights or restrictions for the time being attached to any class or classes of Shares whether by the terms of their issue, the Constitution, the Corporations Act or the Listing Rules, at a general meeting of the Company every holder of fully paid ordinary Shares present in person or by a representative has one vote on a show of hands and every such holder present in person or by a representative, proxy or attorney has one vote per share on a poll. A person who holds an ordinary share which is not fully paid is entitled, on a poll, to a fraction of a vote equal to the proportion which the amount paid bears to the total issue price of the Share. A member is not entitled to vote unless all calls and other sums presently payable by the member in respect of Shares in the Company have been paid. Where there are two or more joint holders of the Share and more than one of them is present at a meeting and tenders a vote in respect of the Share (whether in person or by proxy or attorney), the Company will count only the vote cast by the member whose name appears before the other(s) in the Company’s register of members.

• Issues of Further Shares

The Directors may, on behalf of the Company, issue, grant options over or otherwise dispose of unissued Shares to any person on the terms, with the rights, and at the times that the Directors decide. However, the Directors must act in accordance with the restrictions imposed by the Company’s Constitution, the Listing Rules, the Corporations Act and any rights for the time being attached to the Shares in special classes of Shares.

• Variation of Rights

At present, the Company has on issue one class of Shares only, namely ordinary Shares. The rights attached to the Shares in any class may be altered only by a special resolution of the Company and a special resolution passed at a separate meeting of the holders of the issued Shares of the affected class, or with the written consent of the holders of at least three quarters of the issued Shares of the affected class.

• Transfer of Shares

Subject to the Company’s Constitution, the Corporations Act, the ASTC Settlement Rules and the Listing Rules, ordinary Shares are freely transferable.

The Shares may be transferred by a proper transfer effected in accordance with ASTC Settlement Rules, by any other method of transferring or dealing introduced by ASX and as otherwise permitted by the Corporations Act or by a written instrument of transfer in any usual form or in any other form approved by the Directors that is permitted by the Corporations Act. The Company may decline to register a transfer of Shares in the circumstances described in the Company’s Constitution and where permitted to do so under the Listing Rules. If the Company declines to register a transfer, the Company must, within five business days after the transfer is lodged with the Company, give the lodging party written notice of the refusal and the reasons for refusal. The Directors must decline to register a transfer of Shares when required by law, by the Listing Rules or by the ASTC Settlement Rules.

• Partly Paid Shares

The Directors may, subject to compliance with the Company’s Constitution, the Corporations Act and the Listing Rules, issue partly paid Shares upon which amounts are or may become payable at a future time(s) in satisfaction of all or part of the unpaid issue price.

• Dividends

The Company in general meeting may declare a dividend if the Directors have recommended a dividend, and a dividend shall not exceed the amount recommended by the Directors. The Directors may authorise the payment to the members of such interim dividends as appear to the Directors to be justified by the Company’s profits and for that purpose may declare such interim dividends.

Subject to the rights of members entitled to Shares with special rights as to dividend (if any), all dividends in respect of Shares (including ordinary Shares) are to be declared and paid proportionally to the amount paid up or credited as paid up on the Shares.

• Winding Up

Subject to the rights of holders of Shares with special rights in a winding up, if the Company is wound up, members (including holders of ordinary Shares) will be entitled to participate in any surplus assets of the Company in proportion to the Shares held by them respectively irrespective of the amount paid up or credited as paid up on the Shares.

• Dividend Plans

The Directors or the members of the Company, in general meeting, may establish and maintain dividend plans under which (among other things) a member may elect that dividends payable by the Company be reinvested by way of subscription for Shares in the Company or a member may elect to forego any dividends that may be payable on all


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or some of the Shares held by that member and to receive instead some other entitlement, including the issue of Shares.

• Directors

The Company’s Constitution states that the minimum number of Directors is three.

• Powers of the Board

The Directors have power to manage the business of the Company and may exercise that power to the exclusion of the members, except as otherwise required by the Corporations Act, any other law, the Listing Rules or the Company’s Constitution.

9.5 terms anD conDitions of options

9.5 (a) options to Directors

As at the date of this Prospectus, the Company has granted 8,250,000 Options to the Directors on the following terms and conditions:

• The options held by the Optionholder are exercisable in whole or in part on or before 3 September 2014 (“exercise period”). Options not exercised before the expiry of the Exercise Period will lapse.

• Options are exercisable by notice in writing to the Board delivered to the registered office of the Company and payment of the exercise price of $0.20 per option in cleared funds.

• The Company will not apply for official quotation on ASX of the Options. An application may be lodged at a later date to list the options in the sole discretion of the Board of the Company should the Board considers that there is sufficient spread of option holders to result in a market for the options on ASX.

• The Company will make application for official quotation on ASX of new shares allotted on exercise of the Options. Those Shares will participate equally in all respects with existing issued ordinary shares, and in particular new shares allotted on exercise of the options will qualify for dividends declared after the date of their allotment.

• Options are not transferable, except that if at any time before expiry of the Exercise Period the Optionholder dies, the legal personal representative of the deceased Optionholder may:

• elect to be registered as the new holder of the options,

• whether or not he becomes so registered, exercise those options in accordance with the terms and conditions on which they were granted, and

• if the deceased has already exercised options, pay the exercise price in respect of those options.

• An Optionholder may only participate in new issues of securities to holders of ordinary shares in the Company if the option has been exercised and shares allotted in respect of the option before the record date for determining entitlements to the issue.

• If there is a bonus issue to the holders of ordinary shares in the capital of the Company, the number of ordinary shares over which the option is exercisable will be increased by the number of ordinary shares which the holder of the option would have received if the option had been exercised before the record date for the bonus issue.

• If the Company makes a rights issue (other than a bonus issue), the exercise price of options on issue will not change.

• If, during the currency of the options the issued capital of the Company is reorganised, those options will be reorganised to the extent necessary to comply with ASX Listing Rules and the Corporations Act at the time of reorganisation.

9.5 (b) options to vendors

As at the date of this Prospectus, the Company has agreed to grant 3,500,000 Options to Vendors on the following terms and conditions:

• Murchison Resources Pty Ltd – 500,000 Options exercisable at $0.20 per Option expiring 2 years from date of quotation on the Australian Securities Exchange.

• JML Resources Pty Ltd – 3,000,000 Options exercisable at $0.20 per Option expiring 5 years from date of quotation on the Australian Securities Exchange.

These Options are to be otherwise granted on the terms and conditions as set out in Section 9.5(a).


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9.5 (c) options to sponsoring Broker

As at the date of this Prospectus, the Company has agreed to grant between 1,000,000 and 3,000,000 Options to Shaw (refer to Section 8.2 of the Prospectus for the terms of allotment) on terms and conditions as set out in Section 9.5(a) of this Prospectus.

9.5 (d) options to seed capitalists

As at the date of this Prospectus, the Company has granted 1,250,000 Options to seed capital investors exercisable in whole or in part on or before 3 September 2014 (“exercise period”).

All other terms and conditions are the same as set out in Section 9.5(a).

9.6 employee share option scheme

The Company has established an employee incentive Option scheme (“scheme”). The Scheme is designed to provide eligible participants with an ownership interest in the Company and to provide additional incentives for eligible participants to increase profitability and returns to Shareholders.

The summary of the Scheme is set out below for the information of potential investors in the Company. The detailed terms and conditions of the Scheme may be obtained free of charge by contacting the Company.

general

The Board may from time to time, in its absolute discretion, offer to grant options to eligible participants under the Scheme.

Each Option will be issued for no consideration and will carry the right in favour of the Optionholder to subscribe for one (1) Share in the capital of the Company.

The Board may determine the exercise price of the options in its absolute discretion provided the exercise price shall not be less than the weighted average of the last sale price of the Company’s Shares on ASX at the close of business on each of the five business days immediately preceding the date on which the Directors resolve to grant the options.

eligible participants

Full time employees, part time employees and consultants of the Company or an associated body corporate (the “group”) are eligible to participate in the Scheme.

lapse of options

Unless the Board in its absolute discretion determines otherwise, Options shall lapse immediately on:

(a) the expiry of the exercise period;

(b) the Optionholder ceasing to be within the category of eligible participant by reason of dismissal, resignation or termination of employment, office or services for any reason, except the Directors may resolve within 30 days of such dismissal, resignation or termination, that the Options shall lapse on other terms they consider appropriate;

(c) the expiry of 1 year after the Optionholder ceases to be within the category of eligible participant by reason of retirement; and

(d) a determination by the Directors that the Optionholder has acted fraudulently, dishonestly or in breach of his or her obligations to the Company or an associated body corporate.

participation in future issues

There are no participating rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 7 business days after the issue is announced. This will give optionholders the opportunity to exercise their options prior to the date for determining entitlements to participate in any such issue.

If the Company makes a pro rata issue of securities (except a bonus issue) to the holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) the exercise price of the Options shall be reduced in accordance with the formula in ASX Listing Rule 6.22.2.


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In the event of a bonus issue of Shares being made pro-rata to Shareholders (other than an issue in lieu of dividends), the number of Shares issued on exercise of each Option will include the number of bonus Shares that would have been issued if the Option had been exercised prior to the record date for the bonus issue. No adjustment will be made to the exercise price per Option.

reorganisation

The terms upon which Options will be granted will not prevent them being reorganised as required by the Listing Rules on the reorganisation of the capital of the Company.

trigger events

Upon the occurrence of certain trigger events (for example the receipt by the Company of a bidder’s statement in respect of the Company), the Directors may determine:

(a) that the Options may be exercised at any time from the date of such determination, and in any number until the date determined by the Directors acting bona fide so as to permit the Optionholder to participate in any change of control arising from a trigger event, provided that the Directors will forthwith advise in writing each holder of such determination. Thereafter, the Options shall lapse to the extent they have not been exercised; or

(b) to use their reasonable endeavours to procure that an offer is made to Optionholders on like terms (having regard to the nature and value of the Options) to the terms proposed under the trigger event in which case the Directors shall determine an appropriate period during which the Optionholder may elect to accept the offer and, if the Optionholder has not so elected at the end of that period, the Options shall immediately become exercisable and if not exercised within 10 days, shall lapse.

9.7 Directors’ interests Except as disclosed in this Prospectus, no Director (whether individually or in consequence of a Director’s association with any company or firm or in any material contract entered into by the Company) has now, or has had, in the 2 year period ending on the date of this Prospectus, any interest in:

• the formation or promotion of the Company; or

• property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer of the Shares; or

• the Offer of the Shares.

Except as disclosed in this Prospectus, no amounts of any kind (whether in cash, Shares, Options or otherwise) have been paid or given or agreed to be paid or given to any Director or to any company or firm with which a Director is associated to induce him or her to become, or to qualify as, a Director, or otherwise for services rendered by him or her or any company or firm with which the Director is associated in connection with:



(a) Remuneration of Directors

Each Director is entitled to such remuneration from the Company as the Directors decide, but the total amount provided to all non-executive Directors must not exceed in aggregate the amount fixed by the Company in a general meeting. The aggregate remuneration for all non-executive Directors has been set at an amount of $250,000 per annum. The Directors have resolved that non-executive directors’ fees will be $50,000 per annum for the Chairman and $40,000 per annum for other non-executive Directors.

Mr Kelly will received remuneration of $150,000 per annum plus superannuation as Managing Director on the terms summarised in Section 8.4 of this Prospectus.

(b) Director interests in contracts

• Brett Fraser and Jay Stephenson are the joint controllers of Wolfstar Group and accordingly have an interest in the Company’s agreement with Wolfstar Agreement described in Section 8.7 of this Prospectus. Pursuant to thhis agreement, the Company will pay fees to Wolfstar Group in respect of services provided to the Company (as described in Section 8.7).

• Mr Allan Kelly is the controller of Debnal Pty Ltd which has entered into agreements with the Company to transfer Debnal Pty Ltd’s tenement interests to the Company. These agreements are described in paragraphs C and D of Part II of the Solicitor’s Report on Tenements in Section 7 of this Prospectus. Pursuant to these agreements, Debnal Pty Ltd will receive consideration comprising a combination of Shares and Options (as described in the Solicitors Report on Tenements in Section 7 of this Prospectus).


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• Mr Allan Kelly is the controller of XGS Exploration Geochemistry Services (xgs). The Company has entered into a Service Agreement with XGS summarised in Section 8.5 of this Prospectus.

• Mr Heath Hellewell is the controller of Neogold Enterprises Pty Ltd (neogold). Neogold has entered into a Service Agreement with the Company. The terms of this agreement are summarised in Section 8.6 of this Prospectus.

(c) Directors’ Interests in the Company’s Securities

The direct and indirect interests of the Directors in the securities of the Company as at the date of this Prospectus are as follows:

Director shares options1

Direct indirect Direct indirect

Brett Fraser 1,000,000

Allan John Kelly 2 6,500,000 4 3,000,000

Heath Albert Hellewell 3 4,000,000 2,000,000

Jay Stephenson 1,000,000

Notes:

1. The terms and conditions of these Options are set out in Section 9.5(a) of this Prospectus. The Options are exercisable at $0.20 on or before 3 September 2014.

2. Allan Kelly has an indirect interest in these securities through the following entities Kelly Family Trust, Kelly Investment Trust and Debnal Pty Ltd. Each of these entities are controlled by Mr Kelly. Mr Kelly is the trustee to all trusts and a Director of the Company.

3. Heath Hellewell has an indirect interest in these securities as Mr Hellewell is the trustee for the Hellewell Family Trust.

4. Debnal Pty Ltd will receive 2,500,000 Shares and 1,250,000 Options upon the Company obtaining conditional approval for Quotation from ASX Limited pursuant to the sale of mining Tenements Agreement as outlined in Part II Material Contracts section of the Solicitors Report in Section 7.

(d) Shareholding Qualifications

The Directors are not required to hold any Shares under the Constitution of the Company.

(e) Indemnity, Insurance and Access

The Company has entered into an Indemnity, Insurance and Access Deed with each of the Directors as referred to in Section 8.3 of this Prospectus.

(f) Insurance

The Company maintains Directors’ and Officers’ Liability Insurance on behalf of the Directors and Officers of the Company.

9.8 interests of nameD personsExcept as disclosed in this Prospectus, no promoter, underwriter, expert or any other person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this Prospectus, nor any firm in which any of those persons is or was a partner nor any company in which any of those persons is or was associated with, has now, or has had, in the 2 year period ending on the date of this Prospectus, any interest in:


• property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer of the Shares; or


Except as disclosed in this Prospectus, no amounts of any kind (whether in cash, Shares, Options or otherwise) have been paid or given or agreed to be paid or given to any promoter, underwriter, expert or any other person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this Prospectus, or to any firm in which any of those persons is or was a partner or to any company in which any of those persons is or was associated with, for services rendered by that person in connection with the formation or promotion of the Company or the Offer under this Prospectus.

Pendragon Capital Limited (“pendragon”) has acted as the investigating accountant in relation to the Offer. As investigating accountant, Pendragon have been involved in undertaking due diligence in relation to financial and


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taxation matters and preparing pro-forma financial accounts, and has prepared the Investigating Accountant’s Report which has been included in this Prospectus. In respect of this work the Company has agreed to pay Pendragon a total of $7,500 (exclusive of GST) for these services.

Steinepreis Paganin Lawyers has acted as the solicitors to the Company in relation to the Offer, and in that capacity and otherwise assisting the Company with the preparation of this Prospectus, Steinepreis Paganin Lawyers has been involved in undertaking certain due diligence enquiries in relation to legal matters and providing legal advice to the Company in relation to the Offer and has prepared the Solicitor’s Report on Tenements which has been included in this Prospectus. In respect of this work, the Company has agreed to pay Steinepreis Paganin Lawyers $45,000 (exclusive of GST) for these services up to the date of this Prospectus. In addition, Steinepreis Paganin Lawyers has not received any professional fees from the Company to date.

David Tonkin and Associates will receive professional fees of $10,000 (exclusive of GST) for the provision of the Independent Geologist’s Report.

Malcolm Castle will receive professional fees of $10,000 (exclusive of GST) for the provision of services in relation to the Independent Geologist’s Report.

Wolfstar Group Pty Ltd has acted as Corporate Adviser to the Company in relation to this Prospectus. In respect of this work, Wolfstar Group Pty Ltd is estimated to receive fees of between $84,000 and $144,000 (exclusive of GST). Wolfstar Group Pty Ltd has received $18,000 from the Company to date.

Shaw Stockbroking Limited has agreed to act as sponsoring broker in respect of the Offer pursuant to the Sponsoring Broker Agreement. In respect of this work the Company has agreed to pay Shaw Stockbroking Limited the fees described in Section 8.2 of the Prospectus.

Computershare Investor Services Pty Ltd has agreed to provide share registry services to the Company in accordance with a detailed schedule of fees listed in its “Proposal to Doray Minerals Limited for Share Registry Services” dated 2 November 2009.

9.9 expenses of the offerThe estimated expenses (exclusive of GST) connected with the Offer which are payable by the Company, based on the full subscription of $6,000,000 and maximum subscription of $8,000,000 are as follows:

Based on full subscription $

Based on maximum subscription $

Brokerage fees 360,000 480,000

Investigating Accountants’ Report 7,500 7,500

Legal Expenses 45,000 45,000

Independent Geologist’s Report 20,000 20,000

ASX and ASIC fees 35,024 40,367

Corporate Adviser Fees 114,000 144,000

Printing, marketing and distribution 34,500 34,500

Consulting Fees 19,500 19,500

total 635,524 790,867

9.10 consentsEach of the parties referred to in this Section:

a) does not make, or purport to make, any statement in this Prospectus or on which a statement made in the Prospectus is based, other than as specified in this Section; and

b) to the maximum extent permitted by law, expressly disclaims and takes no responsibility for any part of this Prospectus other than a reference to its name and a statement included in this Prospectus with the consent of that party as specified in this Section.

Pendragon Capital Limited has given its written consent to the inclusion in Section 6 of this Prospectus of its Investigating Accountant’s Report in the form and context in which the report is included, and to being named as Investigating Accountant, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.


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Steinepreis Paganin Lawyers has given their written consent to the inclusion in Section 7 of this Prospectus of their Solicitor’s Report on Tenements and to all statements referring to that report in the form and context in which they are included in this Prospectus, and to being named as Solicitors to the Company, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.

Malcolm Castle has given his written consent to the inclusion in Section 5(a) of this Prospectus of his Independent Geologist’s Report in the form and context of which it is included, and to all statements referring to that report in the form and context in which they appear, and to being named as the Independent Geologist, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.

David Tonkin and Associates has given their written consent to the inclusion in Section 5(b) of this Prospectus of his Independent Geologist’s Report in the form and context of which it is included, and to all statements referring to that report in the form and context in which they appear, and to being named as the Independent Geologist, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.

Shaw Stockbroking Limited has given and as at the date hereof has not withdrawn its written consent before lodgement of this Prospectus with ASIC, to be named as the Sponsoring Broker to the Offer.

Wolfstar Group Pty Ltd has given and as at the date hereof has not withdrawn its written consent before lodgement of this Prospectus with ASIC, to be named in this Prospectus as the Corporate Adviser to the Company in the form and context in which it is named.

Computershare Investor Services Pty Ltd (“Computershare”) has given and, as at the date hereof, has not withdrawn its written consent to be named as Share Registrar in the form and context in which it is named. Computershare has had no involvement in the preparation of any part of this Prospectus other than being named as Share Registrar to the Company. Computershare has not authorised or caused the issue of any part of this Prospectus.

Copies of the consents to the issue of this Prospectus are available for inspection, without charge, at the registered office of the Company.

There are a number of other persons referred to in this Prospectus who are not experts and who have not made statements included in this Prospectus nor are there any statements made in this Prospectus on the basis of any statements made by those persons. These persons did not consent to being named in this Prospectus and did not authorise or cause this issue of the Prospectus.

9.11 electronic prospectusPursuant to Class Order 00/44, ASIC has exempted compliance with certain provisions of the Corporations Act to allow distribution of an electronic prospectus on the basis of a paper prospectus lodged with ASIC and the issue of securities in response to an electronic application form subject to compliance with certain provisions.

If a person has received this Prospectus as an electronic prospectus they should ensure that they have received the entire Prospectus accompanied by the Application Form. If they have not, they should email the Company at [email protected] and the Company will send to that person, for free, either a hard copy or a further electronic copy of this Prospectus or both.

The Company reserves the right not to accept an Application Form from a person if it has reason to believe that when that person was given access to the electronic Application Form, it was not provided together with this Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered. In such case, the Application Monies received will be dealt with in accordance with section 722 of the Corporations Act.

9.12 Documents availaBle for inspectionCopies of the following documents may be inspected free of charge at the registered office of the Company during normal business hours:

• the material contracts referred to in Section 8;

• the Constitution of the Company; and

• the consents referred to in Section 9.10.


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10. Directors’ consentsEach of the Directors has consented in writing to the lodgement of this Prospectus with ASIC and has not withdrawn that consent.

Dated: 20 November 2009

Signed for and on behalf of the Company

Mr Brett Fraser Chairman


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11. DefinitionsIn this Prospectus, unless the context otherwise requires:

“$a” and “$” means Australian dollars, unless otherwise stated.

“applicant” means a person who submits an Application Form under this Prospectus.

“application form” means the application form contained in this Prospectus or a copy of the application form contained in this Prospectus or a direct derivative of the application form which is contained in this Prospectus.

“application money” means 20 cents being the amount payable in respect of each Share under the Offer.

“application” means a valid application to subscribe for Shares.

“asic” means Australian Securities and Investments Commission.

“astc settlement rules” means the operating rules of the ASTC and, to the extent that they are applicable, the operating rules of ASX and the operating rules of Australian Clearing House Pty Ltd.

“astc” means ASX Settlement and Transfer Corporation Pty Ltd (ACN 008 504 532).

“asx” means ASX Limited (ACN 008 624 691).

“Board of Directors” and “Board” means the Board of Directors of the Company as constituted from time to time.

“Business Day” means a day on which the trading banks are open in Perth, Western Australia.

“chess” means ASX Clearing House Electronic Subregistry System.

“closing Date” means the date on which the Offer closes.

“company” means Doray Minerals Limited (ACN 138 978 631).

“completion of the offer” means the allotment of at least 20,000,000 Shares offered under this Prospectus.

“computershare” means Computershare Investor Services Pty Ltd (ACN 078 279 277).

“constitution” means the constitution of the Company.

“corporations act” means the Corporations Act 2001 of Australia.

“Directors” means the directors of the Company.

“Doray” or “Doray minerals” means the Company.

“el” and “exploration licence” means an area granted under the Mining Act in respect to mineral exploration.

“ela” and “application for exploration licence” means an Exploration Licence application.

“exposure period” means the period of seven days (or longer as ASIC may direct) from the date of lodgement of the Prospectus with ASIC.

“hin” means holder identification number.

“issue” means the issue of Shares pursuant to this Prospectus.

“issuer sponsored” means securities issued by an issuer that are held in uncertificated form without the holder entering into a sponsorship agreement with a broker or without the holder being admitted as an institutional participant in CHESS.


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“listing rules” means listing rules of the ASX.

“maximum subscription” means $6,000,000 or 30,000,000 Shares.

“mega hindmarsh pty ltd” is a subsidiary of Mega Uranium Ltd in respect of exploration for uranium on the Harns Bluff and Kingoonya Gawler Craton Projects.

“minimum subscription” means $4,000,000 or 20,000,000 Shares.

“mining act” means the Mining Act 1971 of South Australia and/or the Mining Act 1978 of Western Australia as applicable.

“offer period” means the period commencing on the Opening Date and ending on the Closing Date.

“offer price” means 20 cents being the amount payable in respect of each Share under the Offer.

“offer” means the invitation to apply for Shares pursuant to this Prospectus.

“official list” means the Official List of ASX.

“opening Date” means the date immediately following the expiry of the Exposure Period.

“option” means a right to subscribe for a Share.

“optionholder” means a holder of an Option.

“oversubscriptions” means a maximum of $2,000,000 or 10,000,000 Shares.

“prospectus” means this disclosure document.

“quotation” means quotation of the Shares on the Official List.

“share registrar” means Computershare Investor Services Pty Limited (ACN 078 279 277).

“share” means a fully paid ordinary share in the capital of the Company.

“shareholder” means a holder of Shares in the Company.

“tenement” means an EL, ELA or any other form of mineral licence or title held or applied for by the Company or in which the Company has an interest.

“uranium Joint venture” means the joint venture formed with Venture Minerals Limited and Mega Hindmarsh Pty Ltd.

“Wst” means Western Standard Time, Perth Western Australia.