hoba268aa delta bell bay report 43-101 final v2...compliant resource report. the bell bay quarry...

Bell Bay Quarry Project, Tasmania

43-101 Technical Report

Prepared by Coffey Mining Pty Ltd on behalf of:

Delta Materials Pty Ltd

Effective Date: 10th September 2010

Qualified Person: Troy Lowien – BappSc (Hons)

MINEHOBA00268AA

Coffey Mining Pty Ltd

DOCUMENT INFORMATION

Bell Bay Quarry Project, Tasmania – MINEHOBA00268AA 43-101 Technical Report – September 10th 2010

Author(s): Troy Lowien Associate Resource Geologist (MAusIMM)

Date: September 10th 2010

Project Number: MINEHOBA00268AA

Version / Status: v.01 / Final

Path & File Name: F:\mine\projects\delta\report\HOBA268AA_Delta_Bell_Bay_Report_43-101_final_v1.docx

Print Date: Tuesday, 9 November 2010

Copies: Delta Materials Pty Ltd (2)

Coffey Mining – Spring Hill (1)

Document Change Control

Version Description (section(s) amended) Author(s) D ate

01 Final Troy Lowien 23/09/2010

Document Review and Sign Off

Primary Author Troy Lowien

Supervising Principal Alex Virisheff



Table of Contents

1 Summary ............................................ ...........................................................................................1

2 Introduction ....................................... ...........................................................................................7

2.1 Scope of Work ...................................................................................................................7 2.2 Principal Sources of Information .......................................................................................8 2.3 Independence....................................................................................................................8 2.4 Terms of Reference...........................................................................................................9

2.4.1 Aggregate Specifications and Testing..................................................................... 9 2.4.2 Units of Measure and Reference........................................................................... 11

3 Reliance on Other Experts .......................... ..............................................................................12

4 Property Description and Location .................. ........................................................................13

4.1 Project Location...............................................................................................................13 4.2 Tenement Description .....................................................................................................13 4.3 Royalties..........................................................................................................................14

5 Accessibility, Climate, Local Resources, Infrastruc ture and Physiography .......................15

5.1 Project Access.................................................................................................................15 5.2 Climate ............................................................................................................................15 5.3 Physiography...................................................................................................................15 5.4 Local Resources and Infrastructure ................................................................................15

6 History ............................................ .............................................................................................17

7 Geological Setting................................. .....................................................................................18

7.1 Regional Geology............................................................................................................18 7.2 Local Geology..................................................................................................................20

7.2.1 Stratigraphy ........................................................................................................... 21 7.2.2 Structure................................................................................................................ 21 7.2.3 Alteration ............................................................................................................... 23 7.2.4 Weathering ............................................................................................................ 24 7.2.5 Petrology ............................................................................................................... 26 7.2.6 Rock Quality .......................................................................................................... 27

8 Deposit Types...................................... .......................................................................................29

9 Mineralization ..................................... ........................................................................................30

10 Exploration........................................ ..........................................................................................31

10.1 Introduction......................................................................................................................31 10.2 Chronological Exploration Overview ...............................................................................31 10.3 Geological Mapping Method............................................................................................33 10.4 Joint Mapping ..................................................................................................................34 10.5 Geophysics......................................................................................................................35



11 Drilling ........................................... ..............................................................................................37

11.1 Drilling Program...............................................................................................................37 11.2 Core Logging ...................................................................................................................38 11.3 Drill Summary and Interpretation.....................................................................................39

11.3.1 Central Resource .................................................................................................. 40 11.3.2 West Resource...................................................................................................... 40 11.3.3 East Resource....................................................................................................... 41 11.3.4 Drll Hole Summary ................................................................................................ 41

12 Sampling Method and Approach ....................... .......................................................................50

12.1 Quarry and Outcrop Sampling.........................................................................................50 12.2 Drill Core Sampling..........................................................................................................51

13 Sample Preparation, Analyses and Security.......... .................................................................56

13.1 Introduction......................................................................................................................56 13.2 Particle Density and Water Absorption for the Coarse Aggregate Test

Protocol ...........................................................................................................................56 13.3 Sodium Sulphate Soundness Test Protocol....................................................................56 13.4 Los Angeles Abrasion Test Protocol ...............................................................................56 13.5 Point Load Measurements ..............................................................................................57 13.6 Geochemical Analysis .....................................................................................................57 13.7 Results – Surface Samples .............................................................................................58 13.8 Results – Drill Core..........................................................................................................61

13.8.1 Dolerite Results from the East, Central, and West Resources.............................. 62 13.8.2 Dolerite and Weathered Dolerite Results from the East, Central, and

West Resources .................................................................................................... 64 13.8.3 Dolerite and Weathered Dolerite Results from the West Resource ...................... 66 13.8.4 Dolerite and Weathered Dolerite Results from the Central Resource................... 68 13.8.5 Geotechnical Results ............................................................................................ 70

13.9 Results - Geochemistry of Surface Samples and Drill Core Samples ............................71

14 Data Verification .................................. .......................................................................................75

15 Adjacent Properties ................................ ...................................................................................76

16 Mineral Processing and Metallurgical Testing....... .................................................................77

17 Mineral Resource and Mineral Reserve Estimates ..... ............................................................78

17.1 Mineral Resource Quality ................................................................................................78 17.2 Mineral Resource Quantity..............................................................................................80

17.2.1 Geological Modelling ............................................................................................. 80 17.2.2 Surface Topography.............................................................................................. 81 17.2.3 Resource Boundary............................................................................................... 82 17.2.4 Block Model Construction Parameters .................................................................. 83 17.2.5 Block Model Attributes........................................................................................... 83 17.2.6 Block model Validation .......................................................................................... 84



17.2.7 Bulk Density Assignment....................................................................................... 84 17.3 Mineral Resources Marketability .....................................................................................84 17.4 Mineral Resource Classification ......................................................................................85

17.4.1 Introduction............................................................................................................ 85 17.4.2 Criteria for Resource Categorisation ..................................................................... 85 17.4.3 Categorised Resources......................................................................................... 86

18 Other Relevant Data and Information................ .......................................................................88

19 Interpretation and Conclusions ..................... ...........................................................................89

20 Recommendations .................................... .................................................................................92

21 References ......................................... .........................................................................................93

22 Certificates....................................... ...........................................................................................95

23 Additional Requirements for Technical Reports on De velopment Properties and Production Properties .......................... ..............................................................................96



List of Tables

Table 1 – Bell Bay Quarry - Mineral Resources 5

Table 7.2.4_1 – Drilling Summary 25

Table 7.2.6_1 – Summary of Dolerite Quality Visual Estimates 28

Table 10.4_1 – Joint Trends 34

Table 12.1_1 – Tests Conducted on TasPort Quarry Grab Sample 50

Table 12.2_1 – Composite Sample Information 54

Table 12.2_2 – Tests Conducted on Composites 55

Table 13.7_1 – TasPort Quarry Sample Results 59

Table 13.8.1_1 – Fresh dolerite Sample Results – West, Central and East Resources 63

Table 13.8.2_1 – Fresh and weathered dolerite Sample Results – West, Central and East Resources 65

Table 13.8.3_1 – Fresh and weathered dolerite Sample Results – West Resource 67

Table 13.8.4_1 – Fresh and weathered dolerite Sample Results – Central Resource 69

Table 13.8.5_1 – Point Load Test Results 70

Table 13.8.5_2 – RQD and Joint Frequency – Diamond Drill Core 71

Table 13.9_1 – Geochemical Results – Surface Samples 72

Table 13.9_2 – Geochemical Results – Drill Core Samples 74

Table 17.1_1 – Summary of Key Quality Measurements 79

Table 17.2.4_1 – Block Model Dimensions 83

Table 17.2.5_1 – Block Model Attributes 83

Table 17.2.4_2 – Block Model Domain Coding 84

Table 17.4.3_1 – Mineral Resource Estimates 86

List of Figures

Figure 4.1_1 – Project Location 13

Figure 4.2_1 – Exploration Licence 14

Figure 5.4_1 – Local Infrastructure 16

Figure 7.1_1 – Variation in dolerite composition 19

Figure 7.2.2_1 – Fault Plan 22

Figure 10.5_1 – Gravity survey profiles 35

Figure 11.1_1 – Diamond Drill Rig 37



Figure 12.2_1 – Core Yard 52

Figure 12.2_2 – Core Saw 53

Figure 17.2.1_1 – Geological Models 80

Figure 17.2.1_2 – Base of Weathering Model 81

Figure 17.2.2_1 – Topographic Surface Model 81

Figure 17.2.3_1 – Resource Boundary 82

Figure 17.4.3_1 – Block Model Plan View 87

Figure 17.2.3_1 – Resource Boundary 87

List of Appendices

Appendix 1 – Geology – 1:25,000

Appendix 2 – Geological Mapping

Appendix 3 – Cross Sections

Appendix 4 –Drill Hole Logs

Appendix 5 – Drill Core Photos

Appendix 6 – Surface Mapping Tables

Appendix 7 – Geotechnical Review – Coffey Mining

Appendix 8 – Geophysical Survey Report – Atlas Geophysics

Appendix 9 – Drill Core Analytical Results – Review by CQT

Appendix 10 – Petrographic Studies

Appendix 11 – Drill Core Logging Procedures

Appendix 12 – Field Procedure Manual – Geotechnical Data Collection for Exploration Geologists.


Bell Bay Quarry Project, Tasmania – MINEHOBA00268AA Page: 1 43-101 Technical Report – September 10th 2010

1 SUMMARY

Delta Materials Pty. Ltd. (Delta), which is owned 100% by Delta Minerals Corporation (Delta Minerals)

commissioned Coffey Mining Pty. Ltd. (Coffey) to provide an independent, Qualified Person’s review

and resource estimate, and to prepare an NI 43-101 compliant report based upon results from the initial

(Phase 1) exploration program at the Bell Bay Quarry Project, Tasmania. Mr. Troy E Lowien,

MAusIMM, Associate Resource Geologist at Coffey, served as the Qualified Person responsible for the

preparation of the Technical Report to support disclosure of Mineral Resources as of the

10th September 2010. This report is to comply with disclosure and reporting requirements set forth in

the Toronto Stock Exchange Manual, National Instrument 43-101 Standards of Disclosure for Mineral

Project (“NI 43-101”), Companion Policy 43-101CP to NI 43-101, and Form 43-101F1 of NI 43-101. Mr

Lowien, in addition to supervising the preparation of the Technical Report, conducted the review of the

geological data and estimation of the Mineral Resource.

Delta has conducted an extensive study looking for potential crushed stone quarry sites along the coast

of Australia to supply the Sydney market with construction material. A potential dolerite quarry site in

the Bell Bay area of the Tamar estuary, Tasmania, was selected on the basis of the following criteria:

� good quality dolerite suitable for Sydney’s construction material requirements.

� closeness of the potential quarry to a protected deep water port.

� the potential quarry occurring within a designated industrial area.

� excellent infrastructure supporting the Rio Tinto Alcan aluminum smelter, BHP Billiton Temco

ferromanganese alloy smelter and other significant industrial operations.

� an experienced industrial work force to draw upon from the immediate area and nearby mining

operations.

Delta obtained a two part Exploration Licence, EL6/2009. The northern part of the licence covers the

proposed Bell Bay Quarry Project. The licence was granted by Mineral Resources Tasmania on

August 25, 2009 for a five year tenure ending August 24, 2014. Land title is partly private freehold,

owned by Rio Tinto Alcan, and partly State Forest, managed by Forestry Tasmania.

The ground covered by EL6/2009 was previously held by Tasmanian Hardrock Pty Ltd between 1990

and 1997 as part of a plan to develop a quarry for construction materials for the export market. No

physical work was conducted in the area and the tenure has been reduced to a Retention Licence

located to the south of Delta’s proposed quarry. The Retention Licence is currently held by Bell Bay

Bluestone Pty Ltd.

A small abandoned dolerite quarry is located on West Knob, 500m east of Lauriston Reservoir and

contiguous to EL6/2009. The quarry is owned by Tasmanian Ports Corporation Pty Ltd who hold tenure

to a 1 hectare Mining Lease, 1117P/M. It is believed that the physical and chemical characteristics of

the dolerite and the structural setting are representative of the dolerite within Delta’s area-of-interest. A

large composite grab sample was collected from the Tasmanian Ports Corporation Quarry. The



analytical results were encouraging and the large hills to the east of the quarry, which are now referred

to as the West, Central and East Resources are believed to be composed of similar dolerite.

An exploration program was conducted within the northern part of EL6/2009 from October 2009 to

May 2010. The program consisted of geological mapping, surface rock sampling, a geophysical gravity

and magnetic survey and a total of 2,460.9 metres of diamond drilling in 21 holes. The results from this

exploration program produced sufficient geological and rock quality information to facilitate a NI 43-101

compliant resource report.

The Bell Bay Quarry Project dolerite is a coarse to fine grained, ophitic textured sill with an apparent dip

of approximately 10° to 15° to the southwest. The dolerite sill is cut by steeply dipping NW-SE, E-W

and NE-SW trending faults which separate and bound the drill tested West, Central and East

Resources. In three-dimensional modelling, the dolerite-sedimentary contact appears to have an

elongated bowl like form striking approximately 300° - 120 °. The true thickness of the pre-eroded sill is

unknown, but exceeds 170 metres as defined by drilling.

Surface mapping and orientated core measurements indicate that there are five joint trends in the

project area. Three of the joint trends parallel NW-SE, E-W and NE-SW striking faults. The N-S

trending joints appear to be the dominant trend. The low angled E-W striking and south dipping joints

are widely spaced but they could potentially have an impact on mine planning as could the shallowly

southwest dipping dolerite-sedimentary contact.

The optimal blast hole pattern and explosive type will need to be determined in order to produce the

best combination of feed to the primary crusher, reduce costs associated with secondary breakage and

limit production fines. The relatively close spacing of the steeply dipping orthogonal joint sets may

cause elongation of the fine and coarse fragments. Designing the commercial crushers specifically for

the Bell Bay dolerite should maximise the production of cubic fragments..

The West and Central Resources are separated by the Central Fault Zone with the Central Resource is

bounded on the northeast side by the East Fault Zone. These two major NW-SE trending, steeply

dipping faults have been drill tested. Interpretation of drill core structures and aeromagnetic imagery

suggests an apparent dextral strike slip displacement of approximately 450 metres on the Central Fault.

The Central and East Fault Zones are approximately 80m wide and consist of weathered, sheared and

brecciated dolerite containing predominantly clays, limonite, zeolites, chlorite and carbonate secondary

minerals. The quality of the material within the fault zones does not normally meet the Australian

Standards Specification Limit requirements for the Coarse Fraction Particle Density and Water

Absorption, Sodium Sulphate Soundness Loss and Los Angeles Abrasion Loss tests and therefore the

fault zones have been classified as waste.

The representative composite core samples were classified into the following four categories:

1. Dolerite – this material occurs within the resource and is good quality dolerite without any

significant weathering or deleterious minerals.



2. Weathered Dolerite - this material occurs within the resource and represents the weathered

dolerite in the near surface portions of the drill holes and the more strongly jointed dolerite adjacent

to the fault zones. Four of the vertical holes within the West and Central Resources that

intersected weathered dolerite at surface were not sampled from surface to an arithmetic average

depth of 4.25m.

3. Fault Zone – this material is considered waste because it contains deleterious minerals. However,

there are weathered dolerite boulders and sections of good dolerite within the fault zone which

may be separated by dry screening and then utilized for crushed material or specialty stone.

4. Sediment - this material represents the Triassic age sediments underlying the dolerite and is

considered to be waste.

The Rock Quality Designation, Core Recovery and Point Load testing indicated that the Dolerite and

Weathered Dolerite results for the West, Central and East Resources were as follows:

� Core Recovery averaged 98%, indicating competent rock within the resources.

� RQD averages 63%, which yielded a rating of 13. Together with the other criteria (Intact Rock

Strength, Joint Spacing, Joint Condition and Groundwater) in the Rock Mass Rating Classification

System produced a rating of between 60 and 80 which is described as Good on a five division

scale ranging from Very Poor to Very Good.

� Point Load testing results indicate that 97% of the core tested has a strength classification of R4

(High) to R6 (Extremely High).

The following analytical tests were determined to be critical parameters for evaluating the suitability of

the composite drill core samples for construction material:

� Coarse Fraction Particle Density (>2.5t/m³) and Water Absorption (<2%)

� Sodium Sulphate Soundness Loss (≤6% for concrete exposure classification C and ≤9% for

concrete classification B1 and B2)

� Los Angeles Abrasion Loss (<30%).

The Bell Bay Quarry Project dolerite appears to have comparable properties to material being used in

the Sydney region. The length weighted averages for the Dolerite and Weathered Dolerite Results from

the West, Central and East Resources appear to be:

� Hard and strong (Wet Strength ~ 266kN).

� Dense and fine grained (Coarse Fraction Apparent Particle Density 2.93t/m³ and Water Absorption

1.13%).

� Sound crushed fines (Fine Fraction Apparent Particle Density 2.85t/m³ and Water Absorption

2.59%).

� Sound crushed fines (Fine Fraction Particle Density (SSD) 2.79t/m³ and Water Absorption 2.59%).



� Durable (Wet/Dry Variation 15.04%, Los Angeles Abrasion Loss 13.89%, Sodium Sulphate Loss

4.12%).

� Good resistance to polishing (Polished Aggregate Friction Value 48.50).

� Low Acid Soluble Chloride (<0.001%).

� Low Acid Soluble Sulphate (reported <0.01%).

� Low percentage of crushed fines (<75µm, 2.25%).

Dolerite, with the exception of one composite, yielded test results that exceed the Australian Standards

Specification Limit requirements for use in the concrete and road construction industries. The

composite exception, from BB10-20, was sampled from a zone of closely spaced joints adjacent to the

Central Fault Zone and contains weathering and alteration minerals.

Six composites within the West and Central Resources are classified as Weathered Dolerite.

Weathered Dolerite occurs close to the surface or in areas containing a higher frequency of closely

spaced joints.

� Three of the six composites were sampled from approximately the upper 30m of the drill core and

yielded results that did not meet Australian Standards Specification Limit requirements for at least

one of the critical parameters.

� One of the six composites was collected from a zone of closely spaced joints adjacent to the

Central Fault Zone. The composite contains weathering and alteration minerals and yielded

results that did not meet Australian Standards Specification Limit requirements for at least one of

the critical parameters.

� Two of the six composites exceeded the Australian Standards Specification Limit requirements for

the critical parameters.

Testing of the Dolerite and Weathered Dolerite from the West, Central and East Resources indicated

that the arithmetic and length weighted averages for all tests, with the exception of the Fine Fraction

Water Absorption, exceed the Australian Standards Limit requirements for construction material.

Design of a commercial processing plant will have wet classification to remove a large portion of the

<75µm material and it is hoped this will improve the water absorption result for the -4.75mm fraction.

Therefore, it is believed that the Dolerite and Weathered Dolerite can be blended during mining to

produce a product that would meet the requirements for construction material in the Sydney market.



The mineral resource estimate for the Bell Bay Quarry Project is based upon three components:

� Demonstration of physical and chemical property homogeneity ie Mineral Resource quality.

� Volume/tonnage estimate of material ie Mineral Resource quantity.

� Marketability of the Mineral Resource.

The volume and tonnage of the Bell Bay dolerite in the proposed quarry area were estimated from a

three-dimensional block model utilizing commercial mine planning software (Surpac) and confined by

topographical as well as interpreted lithological and structural constraints.

Delta has demonstrated through its studies to date that the Bell Bay dolerite has a reasonable potential

of being a commercial source of crushed rock for aggregate. Materials testing of drill core from the

West, Central and East Resource areas show that the dolerite has acceptable abrasion resistance,

sulphate soundness loss and water absorption values. Independent studies of the Sydney aggregate

market demonstrate that the area is permanently aggregate deficient and that marine imports or hauling

long distances by truck or train will be required to meet projected demands.

The resource categorisation has been based on the robustness of the various data sources available,

including:

� Geological knowledge and interpretation.

� Surface outcrop observations.

� Drillhole logging and measurements.

The estimated Measured, Indicated and Inferred Resources areas follows (Table 1):

Table 1

Delta Materials Pty Ltd Bell Bay Quarry Project

Mineral Resources – 10 th September 2010 Compiled using Surpac Mining Software

Mineral Resource Category Volume (Mm3)

Tonnes (Mt)

Measured 78.2 229 Indicated 34.6 101

Total - Measured and Indicated 112.9 331 Inferred 3.6 10

A budget estimated at $1.75M is proposed for the Phase 2 drilling program consisting of 40 angled

holes and one vertical hole totalling 5,359 metres. Angled holes are recommended because they will

yield a better understanding of the distribution and characteristics of the predominantly sub-vertical

jointing. Included in the total are three vertical water bore holes totalling 350 metres for hydrogeology

studies and the extension of two drill holes 20 metres into the sediments for geotechnical studies.



It is recommended that prior to the Phase 2 drilling program, a geophysical resistivity orientation survey

be conducted across BB10-12 and the Central Fault Zone. The purpose is to determine if the

weathered dolerite and the fault zone material has an anomalous conductive response due to clay

content. If successful, then it is recommended that the resources be surveyed by geophysical

resistivity. Defining the zones of deleterious material will improve drill hole planning and reduce drilling

costs.

The purpose of the exploration program is as follows:

� to determine the area of influence of weathered dolerite within the resources.

� to determine the area of influence of intensely jointed dolerite adjacent to the faults zones within

the resources.

� to increase the statistical database of composites to allow interpolation of quality parameters

and/or definition of sub-types of unsuitable materials with confidence in volume zones

representative of annual periods in a typical mining sequence.

� to acquire hydrogeological and geotechnical data for baseline studies and mine planning.



2 INTRODUCTION

2.1 Scope of Work

Delta Materials Pty. Ltd. (Delta), which is owned 100% by Delta Minerals Corporation (Delta

Minerals) commissioned Coffey Mining Pty. Ltd. (Coffey) to provide an independent, Qualified

Person’s review and resource estimate, and to prepare an NI 43-101 compliant report based

upon results from the initial (Phase 1) exploration program at the Bell Bay Quarry Project,

Tasmania. Mr. Troy E Lowien, MAusIMM, Associate Resource Geologist at Coffey, served as

the Qualified Person responsible for the preparation of the Technical Report to support

disclosure of Mineral Resources as of the 10th September 2010. This report is to comply with

disclosure and reporting requirements set forth in the Toronto Stock Exchange Manual,

National Instrument 43-101 Standards of Disclosure for Mineral Project (“NI 43-101”),

Companion Policy 43-101CP to NI 43-101, and Form 43-101F1 of NI 43-101. Mr Lowien, in

addition to supervising the preparation of the Technical Report, conducted the review of the

geological data and estimation of the Mineral Resource.

This report has been compiled to summarise the results of exploration, data collection,

database validation and resource estimation of the Bell Bay Quarry Project, using the

exploration data collected by Delta up to the end of August 2010.

Delta has conducted an extensive study looking for potential crushed stone quarry sites along

the coast of Australia to supply the Sydney market in New South Wales with construction

material. A potential dolerite quarry site in the Bell Bay area of the Tamar estuary in

Tasmania was selected on the basis of the following criteria:

� good quality dolerite suitable for Sydney’s construction material requirements.

� the potential quarry occurring within an industrial designated area.

� a protected deep-water harbour along the north coast of Tasmania.

� closeness of the quarry to a potential deep-sea port.

� excellent infrastructure supporting the Rio Tinto Alcan aluminum smelter, BHP Billiton

Temco ferromanganese alloy smelter and other significant industrial operations.

� an experienced industrial work force to draw upon from the immediate area and nearby

mining operations.

The proposed Quarry would be a conventional open pit style, utilising standard equipment and

machinery. Drilling and blasting will be required. Production capacity is estimated to be up to

5 million tonnes per year. Run of mine material would be hauled to a plant site for crushing,

washing and storage in stockpiles. The product would be conveyed via a high-speed

overland conveyor to a shiploader and directly into holds of large ships. These will discharge

their products in Sydney to supply its construction material markets.



Technical staff from Coffey reviewed plans for the Phase 1 drilling program and have visited

the project site to observe exploration drilling in progress. Coffey staff have also inspected

Delta’s core handling facility in Georgetown, Tasmania, to review core logging and processing

procedures. During all site visits, Coffey staff were accompanied by Delta geologist Mr Alex

Boronowski.

Mr Lowien visited the project site on the following dates:

• 12th of October 2009 - to discuss the project, review the Phase 1 drilling program and

inspect the proposed drilling sites.

• 22nd of March 2010 – to inspect Phase 1 diamond drilling activities and core handling and

logging procedures. Mr Lowien observed the drilling of diamond drill hole BB10-2 by

Edrill Pty. Ltd. He also inspected the core handling facilities in Georgetown, where the

first hole was laid out ready for logging. Discussion of composite sample interval

selection was also discussed at this time.

• 2nd of June 2010 – to inspect core after the completion of Phase 1 drilling and to discuss

project progress. Mr Lowien observed the collection of point load measurements from

diamond drill core samples.

2.2 Principal Sources of Information

Delta technical staff have provided data relating to geological information and interpretations,

the master drilling database and other relevant technical data. In summary, the following key

digital data relevant to the resource estimation study were provided:

� Drillhole database (Microsoft Excel spreadsheet format), including collar location and drill

hole information, downhole surveys, geological and geotechnical logging data, magnetic

susceptibility data, .

� Register of outcrop mapping (Microsoft Excel spreadsheet format).

� Point load measurement data.

� A geological report detailing the outcomes of the Phase 1 exploration program.

� A collection of plan maps and sections relating to drilling results and geological

interpretations.

� A detailed digital terrain model representing the topographic surface in the project area.

2.3 Independence

Coffey Mining is part of Coffey International Limited, a highly respected Australian-based

international consulting firm specialising in the areas of exploration, geology, mining,

metallurgy, geotechnical engineering, hydrogeology, hydrology, tailings disposal,

environmental science and social and physical infrastructure.



Neither Coffey Mining, nor the authors of this report, have or have had previously any material

interest in Delta or related entities or interests. Our relationship with Delta is solely one of

professional association between client and independent consultant. This report is prepared

in return for fees based upon agreed commercial rates and the payment of these fees is in no

way contingent on the results of the report.

2.4 Terms of Reference

2.4.1 Aggregate Specifications and Testing

The Australian Standards publish specification limits for crushed stone used in construction in

Australia. Australian Standards Specification Limit requirements vary depending on the area,

climate and desired use. Tests follow rigid protocols and include the following:

� Los Angeles Abrasion Loss Test: This is a standardized test in which crushed material is

subjected to impact and abrasion from steel balls in a mill for a set amount of time. The

amount of material lost to fines is measured. Most specifications for bituminous concrete

and Portland cement concrete require a loss of less than 30%.

� Sodium Sulphate Soundness Test: The resistance to drying and wetting cycles of sea

water or saturated air is measured by subjecting crushed materials to repeated cycles of

immersion and drying in sodium sulphate solution. The amount of fines produced in the

process is measured. Specifications for bituminous concrete and Portland cement

concrete require a loss of less than <6% for concrete with “concrete exposure

classification C” and <9% for “concrete exposure classification B1 and B2”, the most

common construction material uses.

� Gradation Test: The rock is crushed at variable starting sizes to determine the natural

gradation in grain sizes produced from each. Material with a uniform and wide range in

sizing (from coarse to fine) will be desirable for a product (such as foundation concrete)

different from one with a narrow range in grain sizes (such as drainage material).

Ranges allowable for each sieve size are relatively wide.

� Deleterious Materials: The amount of deleterious materials such as organic matter,

chert, clay, coal, coke, shale and soft particles are measured. No more than 0.25% clay

lumps, 2.0% soft fragments and 0.25% coal and lignite are allowed.

� Fines: A wash test is used to measure the amount of minus 75µm material naturally

present or produced in crushing. Excessive fine material will prevent the aggregate from

draining freely or may form an unwanted coating on coarse particles, which will require a

binder to be added to the mix. Fines are present due to natural clay content of the

material or the presence of clay-coated fracture planes in the rock. Tests should indicate

less than 4.0% excess fines.

� Fine fraction Particle Density (Specific Gravity) and Water Absorption Test: The particle

density and water absorption is measured by water immersion. The specific gravity is

used to determine the Portland cement or bitumen concrete mixture. The amount of



water absorption is necessary to determine the amount of water that must be added in

concrete mixes. Acceptable specific gravity specification is >2.5t/m³ and a water

absorption specification <2.5%.

� Coarse fraction Particle Density (Specific Gravity) and Water Absorption Test: The

particle density and water absorption is measured by water immersion. The specific

gravity is used to determine the Portland cement or bitumen concrete mixture. The

amount of water absorption is necessary to determine the amount of water that must be

added in concrete mixes. Acceptable specific gravity specification is >2.5t/m³ and <2.0%

for water absorption.

� Particle Shape 2:1 and 3:1: Crushed particles should be as cubic as possible with a

minimum of flat and elongated pieces. Metamorphic rocks or sheared rocks often have a

platy cleavage and produce an unacceptable amount of flat particles. Bituminous

concrete and Portland cement concrete specifications require <10% 3:1 and <35% 2:1

elongated particles. Note, that the P value is generally improved when designing the

production crusher.

� Wet/Dry Strength Variation (%): A durability test where for all cases the wet/dry strength

variation shall not exceed 25% as required for the highest level concrete exposure

classification.

� Wet Strength (kN): Refer to the above durability test. Specification limit >100kN

� Dry Strength (kN): Refer to the above durability test. Specification limit >150kN

� Chlorides: The chloride ion content of aggregates determined quantitatively shall be

reported if in excess of 0.033%

� Sulphates: The sulphate ion content of aggregates determined quantitatively shall be

reported if in excess of 0.01%.

� Polished Aggregate Friction Value (PAFV): a pendulum friction test that determines the

susceptibility to polishing expressed as the polished aggregate friction value (PAFV). A

PAVF of ≥44 is the acceptable limit.

Delta tested the Bell Bay dolerite using the above listed tests. These tests provide the most

important measures of suitability for crushed rock aggregate and are adequate at the present

stage of the project.



2.4.2 Units of Measure and Reference

Coordinate System: GDA 1994, MGA Zone 55

Projection: Transverse Mercator

Datum: GDA 1994

% = percent

° = degrees

°C = degrees Celsius

cm = centimetres

g = grams

g/cc = grams per cubic centimetre

ha = hectares (10,000 square metres)

kg = kilograms

km = kilometres

km² = square kilometres

kN = kiloNewtons

M = millions

m = metres

m³ = cubic metres

masl = metres above sea level

mm = millimetres

ppm = part per million

st = short ton

t = dry metric tonne

wt% = weight percent



3 RELIANCE ON OTHER EXPERTS

Coffey’s review and resource estimate of the Bell Bay Quarry Project has relied upon the

representations and judgements of the following parties in regards to description of mineral

leases, regional and local geology, material properties and marketability. Coffey used this

information under the assumption that each individual is a Qualified Person:-

� Mr Alex Boronowski and Mr Ken Morrison, geologists working for Delta Materials Pty Ltd,

prepared information relating to mineral leases, regional and local geology, deposit type,

exploration results and marketability.

� Mr Michael van Koeverden, Principal of Concrete Quarry Technical Services Pty. Ltd.,

Newcastle, NWS provided consultation to Delta regarding the test results for the Bell Bay

dolerite and compared the results with the various Australian Standards Specification

Limits as required by the Sydney construction material market.



4 PROPERTY DESCRIPTION AND LOCATION

4.1 Project Location

The Bell Bay Quarry Project is located in the Tippogoree Hills of the north-eastern Tamar

Valley, Tasmania, Australia (Figure 4.1_1). It is situated 200km north of the Tasmanian

capital Hobart, and 40km north of Launceston.

Figure 4.1_1


Project Location

4.2 Tenement Description

The Bell Bay Quarry Project is situated within Exploration Licence 6/2009. This licence is

broken up into northern and southern parts with a total area of 17km2 (Figure 4.2_1). The

licence (Category 3 – Construction Materials) was granted to Delta Materials Pty. Ltd. by

Mineral Resources Tasmania, on August 25, 2009, for a five year tenure ending on

August 24, 2014. A work commitment of $20,000 is required for the first two years of

exploration and a rent of $22.44 per square km is due annually on the August 25th anniversary

date.

The Bell Bay Quarry Project is entirely within the northern part of EL6/2009. Land title is

partly privately owned freehold and partly State Forest, managed by Forestry Tasmania. The

freehold land is owned by Rio Tinto Alcan, who operate the Bell Bay aluminium smelter



located approximately 3km to the west, and the State Forest portion falls within the

Tippogoree Hills Forest Reserve and is managed by Forestry Tasmania.

Exploration Licences issued by the State Government agency, Mineral Resources Tasmania,

empower the licence holder to explore on both private land and State Forest, following

guidelines set out in the Mineral Exploration Code of Practice (Bacon, 1999).

Figure 4.2_1


Exploration Licence

4.3 Royalties

Royalty in Tasmania is payable under Section 102 of the Mineral Resources Development Act

1995 (MRDA) in accordance with Part 3 of the Mineral Resources Regulations 2006 (MRR).

A royalty is payable on all minerals recovered under a mining lease. Royalty is payable to the

Minister in respect of any mineral recovered from Crown land, and in respect of any mineral

owned by the Crown which is recovered from private land.

The act levies royalty at a rate of AU$0.60 per tonne for stone (crushed and broken) as at the

1st of July 2010.



5 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTR UCTURE AND PHYSIOGRAPHY

5.1 Project Access

The project area has all year round vehicle access via a network of 4WD tracks linked to

bitumen main roads from the west (East Tamar Highway) and north (Bridport Road). The

East Tamar Highway connects the area to Launceston, with a population of 105,000, located

40km southeast of the project area. Daily flights from Launceston Airport connect to all major

Australian cities via Melbourne, Sydney or Brisbane.

5.2 Climate

The Bell Bay area has a cool to warm, temperate maritime climate, with a daily sea breeze

influence throughout the year. Climate data for the area are obtained from the closest

Commonwealth Bureau of Meteorology station located in Launceston. Mean minimum

temperature ranges from 2.60C in July to 11.50C in February, compared to mean maximum

temperatures ranging from 11.30C in July to 23.90C in February. Mean monthly rainfall ranges

from 40mm in January to 96.8mm in August and mean daily 3pm wind speed ranges from

11.6km/hr in June to 23.1km/hr in December.

5.3 Physiography

The physical geography of the area is dominated by the Tippogoree Hills, a northwest-

southeast trending strike range of dolerite capped hills extending for at least 8km and forming

the eastern margin of the Tamar Graben, a rift basin which contains the Tamar River. In the

resource area the dolerite hills range in elevation from approximately 50 to 250 metres above

sea level (masl) and the landscape is dissected by ephemeral creeks which drain in a

generally south westerly direction into Lauriston Reservoir, Howell Reservoir and the Tamar

River.

5.4 Local Resources and Infrastructure

The Bell Bay port, located 4 km west of the project area, on the eastern shore of the Tamar

River, is the major deep water industrial shipping port in Tasmania and handles 50,000 tonne,

Handimax-size cargo ships during bulk loading for the aluminium, manganese and wood

product industries located at Bell Bay (Figure 5.4_1). The service town for the Bell Bay

industrial complex is George Town, located 3 km northwest of Bell Bay. George Town has a

population of approximately 5,000 and an industrially based economy. All the normal retail

and engineering services required to support the current stage of the project are available in

the community.



Figure 5.4_1


Local Infrastructure Exploration Licence Boundaries, Drillhole Locations



6 HISTORY

No evidence of previous mineral exploration activities or results relating to the area covered

by EL 6/2009 are known to Delta. The ground was previously held under Exploration Licence

by another company, Tasmanian Hardrock Pty Ltd., between 1990 and 1997 as part of their

construction materials Exploration Licence 10/1990, but no exploration results for the area

exist in the Mineral Resources Tasmania archives. In 1997 two portions of the expired

EL10/1990 were converted to Retention Licences 2/1997 and 3/1997 and subsequently title to

RL 3/1997, located between north and south parts of Delta’s EL 6/2009, was transferred to B3

(Bell Bay Bluestone) Pty Ltd, which presently maintain a year by year tenure on RL 3/1997.

Tasmanian Ports Corporation Pty Ltd acquired a 100m by 100m, Mining Lease 1117P/M to

cover the West Knob dolerite (Figure 5.4_1). West Knob is located approximately 500 m east

of Lauriston Reservoir and adjacent to Delta’s EL 6/2009. The mining tenement was a source

of armour rock for the Bell Bay port development.



7 GEOLOGICAL SETTING

7.1 Regional Geology

Middle Jurassic dolerite, with K-Ar dates averaging 175+/- 8 Ma (Calver and Seymour, 1998),

outcrops over approximately 30,000km2 of central-southeastern Tasmania. About 15,000km3

of dolerite is estimated to have intruded into post orogenic, flat lying Carboniferous-Triassic

sedimentary rocks which comprise the Parmeener Super Group stratigraphy of the Tasmania

Basin (Banks et al, 1989). The Tasmanian dolerite represents a minor fraction of the total

magma volume injected into the upper crust as a precursor to the breakup of Gondwana

Land, including the separation of Tasmania from Antarctica, which JOIDES (Joint

Oceanographic Institutions for Deep Earth Sampling) deep sea drilling indicates was

completed during the Eocene.

Gondwana Mesozoic dolerites and extrusive equivalents have a tholeiitic continental

geochemical and isotopic signature and tectonic setting, comparable to major basaltic

provinces such as the Karoo of southern Africa and the Deccan Traps in India (Hergt and

McDougall (1989). In the Tasmania Basin, the large majority of dolerite occurs as stratiform

or slightly discordant sills and cone sheets, sometimes with stacked interstratified sills

connected by feeder dykes (Leaman, 2002). Only one occurrence of lava is recorded, near

Lune River in southern Tasmania, but it is likely that extrusive rocks have been eroded during

unroofing of the sills to create the current outcrop distribution (Sutherland, 1977). Leaman

(1975) and Leaman and Richardson (1981) studied feeder distribution from detailed gravity

surveys over two regions. They estimated that feeder spacing averaged 4-8 kilometres and

that feeder axial trends showed a strong approximately north-south alignment.

The whole rock chemistry of Tasmanian dolerites is very similar to the Ferrar Group in

Antarctica and on the basis of 87Sr/86Sr initial ratios and Hergt and Brauns (2001) conclude

that a common parental magma is likely. In general Tasmanian dolerites are higher in SiO2,

CaO and Al2O3 and lower in FeO, TiO2, Na2O, K2O and P2O5 than most Gondwana

continental tholeiites.

Typical dolerite away from chilled margin contacts has a medium grained ophitic texture

composed essentially of plagioclase feldspar (anorthite 60-70) and clinopyroxene (augite and

pigeonite) crystals with a glassy quartz and alkali feldspar rich mesostasis (very fine grained

quartz-feldspar matrix) infill. More detail regarding the mesostasis infill is contained in the

MRT petrographic studies (Appendix 10). Near basal sill contacts containing orthopyroxenes

may be the result from pigeonite inversion. The dolerites are oversaturated in silica and

uncommon highly fractionated facies of pegmatite and granophyre occur with modal quartz

crystals, and rarely, with iron olivine near the top of a sill. The general fractionation trend from

the base to the top of a sill is one of increasing Fe in pyroxene at the expense of Ca and Mg,

increasing alkali feldspars at the expense of Ca plagioclase, increasing modal quartz and an

increasing proportion of mesostasis relative to crystals. These trends provide opportunity for

thin section petrography to help in predicting nearness to a chilled margin contact.



Ilmenite and magnetite are the main accessory opaque minerals and result in the dolerite

being weakly to moderately magnetic relative to the host stratigraphy. Dolerite density varies

in a typical sill from 2.8-3.0 t/m3, in direct correlation with pyroxene content which ranges from

approximately 45% near the sill base, but above the chilled margin, down to 15% near the sill

top, but below the contact (Figure 7.1_1).

Figure 7.1_1


Vertical Variation in Composition and Density of Ju rassic Dolerite Through a Thick Sheet (McDougall 1958)

Regional metamorphism and cleavage-forming folding are absent in Tasmanian rocks

younger than Late Carboniferous (Williams, 1976), so the structural geology of the dolerite is

controlled by a combination of pre Jurassic major crustal fractures, magma cooling jointing

and post crystallization faulting, fracturing and veining. Post Jurassic deformation in

Tasmania, as it is currently understood, is entirely of an extensional rifting style, controlled by

continental break up and characterized by normal faulted graben structures and strike slip

shears (Morrison et al, 1989, Seymour and Calver, 1998). Apart from relatively minor Tertiary

syn-magmatic alteration at intrusion contacts, most thermal alteration of the dolerite appears

to be controlled by Tertiary faulting and burial depth at the time of structural dilation

(Sutherland, 1977).

Tasmanian Geological Survey regional mapping shows evidence of sub vertical cooling joints

with a spacing of a few centimeters close to dolerite contacts, in contrast to spacing of 3-5

metres more distant from contacts (Forsyth, 1984). Widely spaced more penetrative sub

horizontal sheet jointing parallel to contacts and joints and veins dipping at 40-60 degrees are



also mapped within the Tasmanian dolerites. Many of the non vertical joints and veins are

likely to be Tertiary tectonic structures, rather than cooling joints, and any associated vein or

secondary fracture fill mineralogy may be related to depth of burial, Tertiary volcanism and

associated hydrothermal events or low temperature weathering processes.

Landscape features important in mapping dolerite outcrop distribution include wedge shaped

aprons of talus at the base of flat topped cliffs or escarpments of outcrop. This morphology

ranges in scale from mountain size down to bench topped steep outcrop slopes of only a few

metres, but regardless of scale it is common for the talus at the foot of outcrop slopes to mask

basal sill contacts which are invariably much closer to the dolerite outcrop than is indicated by

mapping the talus. Detailed aeromagnetics in combination with field mapping and

topographic considerations can lead to an accurate pick for a dolerite contact covered by

dolerite talus.

The Tamar Graben is a good example of structural focusing of intrusions and resultant

landform scale fabric. The map in Appendix 1 shows the regional geology surrounding the

Bell Bay Quarry Project in the northeastern portion of the Tamar Valley. The dolerite on

Tippogoree Hills is broadly stratiform and appears to have intruded into a unit of Triassic

sandstone and micaceous mudstone, stratigraphically near the top of the Parmeener Super

Group rocks preserved in the region. The entire sequence of Permo-Triassic sediments and

Jurassic dolerite is structurally NW-SE aligned, conformable with the strike of the Tamar

Graben. Numerous small scale faults are mapped within the sedimentary units and implied

through the dolerite due to the fabric defined by airphoto lineaments. A major east-west

structure is apparent in the approximate position of Bridport Road but south of Bridport Road

the mapped faults show only minor local disruption to the stratigraphy. Several dip and strike

readings in Permian sedimentary rocks north of Tippogoree Hills consistently show a dip to

the southwest, towards the graben axis, at an average dip angle of 180. It is likely that the dip

of the dolerite and host sedimentary rocks is controlled by graben faulting and will be

conformable with the strike trend of the regional dolerite-Triassic sediment contact dipping

approximately 11° to the southwest.

7.2 Local Geology

The factual descriptions and interpretations in this section of the report are based on

information sourced from the following data:

� Delta Materials Geological Mapping (Appendix 2).

� Delta Materials Drill Logs-BB10-01 to BB10-21 (Appendix 4)

� Delta Materials Core Photos BB10-01 to BB10-21 (Appendix 5)

� Coffey Laboratory Drill Core Analytical Results and Review by CQT Services Pty Ltd

(Appendix 9)



� Mineral Resources Tasmania, Vancouver Petrographics Ltd., and AMEC Petrology

Reports and Geochemistry (Appendix 10)

� Atlas Geophysics Pty Ltd Gravity/Magnetics Survey and SMEG Report (Appendix 8)

� Tasmanian Geological Survey Digital Geology Atlas 1:25000 Scale Bell Bay Sheet 4844

(Appendix 1)

� AGSO P699 North Tasmania Aeromagnetics Survey, NGMA Project, 1999.

7.2.1 Stratigraphy

All 21 diamond drill holes in the Phase 1 drilling program intersected a basal

dolerite-sedimentary contact. In all instances the contact included a fine grained glassy

textured chilled margin within the dolerite, overlying a sedimentary sequence of dominantly

medium grained, trough cross bedded, quartz and quartz-mica sandstone, interbedded with

laminated mudstone and organic-rich siltstone. Fining-up cycles within the sediments are

common, with the basal unit to each cycle being either a thin mudstone pebble conglomerate

or a thin quartz granule wacke. The sedimentary rocks also outcrop near the northern and

southern margins of the dolerite deposit and in both locations columnar cooling joints in

hornfelsed sandstone indicate closeness to the contact and, in combination with the drill

intersections, demonstrate that the dolerite deposit is a stratiform sill.

The sequence of sedimentary rocks which underlay the dolerite also has been mapped,

mainly as subcrop, along the northeast contact with the Tippogoree Hills dolerite (Appendix 1)

and regionally the sediments are litho correlates of the lower Triassic fluviatile, quartz

sandstone dominant sub division of the Parmeener Supergroup within the Tasmania Basin

(Forsyth, 1989).

The dolerite sill shows a consistent internal stratigraphy expressed as a decrease in grain size

and change in texture from top to bottom. Drill core commonly shows a coarse grained, more

graphic textured dolerite at the top of the hole, grading down to medium grained ophitic

textured dolerite (the most common type overall), and with a fine grained, relatively thin chilled

margin above the basal contact. The chilled margin dolerite is darker in colour, finer grained

and has a slightly glassy and fine porphyritic texture compared to the overlying dolerite. It is

always more magnetic than the overlying dolerite. The fine grained chilled margin dolerite is

present in every hole, whereas the gradation from coarse grained down hole to medium

grained dolerite was not observed in every hole, but is sufficiently widespread to support the

interpretation that the deposit is a single sill

7.2.2 Structure

The currently identified deposit is closed at depth stratigraphically and is bound on four sides

and bisected into two fault blocks by a combination of proven and inferred faults

(Figure 7.2.2_1). Several cross sections looking north, show average apparent dips for the

basal dolerite contact ranging from 80 to 130 to the southwest (Appendix 3). The contact dip

tends to steepen close to the central fault and to the faults at the northern, eastern and



southern deposit boundaries. In three dimensional modelling, the contact surface appears to

have an elongated east-west trending bowl form, but overall plunging to the southwest and

remaining open to the southwest.

Figure 7.2.2_1


Proven an Inferred Fault locations

The NW-SE trending Central Fault and East Fault have been proven by 9 and 2 diamond drill

holes respectively; whereas the parallel West Fault is inferred from correlated anomalies on

modelled gravity profiles (refer to Section 10.5 for details regarding the gravity survey).

Drilling shows that the Central Fault and East Fault are broad zones, up to 80 metres wide, of

strained dolerite characterized by intervals of intense fracturing and brecciation, alternating

with intervals of relatively massive unstructured dolerite. The Central Fault is the best

understood fault structure within the deposit. Core logging indicates that the zone of

deformation is approximately 80 metres wide in the central part of the deposit and that the

structure has a near vertical dip, with measurements varying from >850 NE to >850 SW.

There is evidence of relatively late strike slip movement on the Central Fault, in the form of,

firstly, topographic and aeromagnetic imagery anomalies showing dextral offset and,

secondly, horizontal slickensides on zeolite minerals along joints/veins within core from

vertical drill holes. Inferred faults EW 1, EW 2 and EW 3 form the northern and southern

boundaries of the deposit. These structures are inferred from strong topographic / drainage

lineaments and aeromagnetic data discontinuities.

Two types of planar structures are recognised in outcrop and drill core; magmatic cooling

joints and less common post intrusion tectonic joints. First order cooling joints occur as near



vertical polygonal columns with a typical diameter of 2 to 3 metres. In plan view sets of

curvi-planar joints originate from the corners of the polygons and exhibit a fan-shaped form

with a closer spaced main set and a relatively open spaced orthogonal set. In outcrop

mapping these second order cooling joints are by far the most abundant structures exposed.

A stereographic projection of poles to cooling joints mapped across the deposit shows that

they are concentrated into separate steeply north-dipping and steeply east–dipping

populations. These data were used in combination with the obvious northwest-southeast

striking tectonic fabric, to design angled drill holes in the phase 1 program with 050° and 230°

grid azimuths. In drill core the cooling joints range from completely annealed faint traces with

a slightly wavy to stepped form to open fracture filled with secondary vein style alteration

minerals.

Low angle joints and fractures interpreted as having a tectonic origin are exposed in the Port

Authority quarry and in drill core, where they rarely show dilation and secondary vein

mineralization. In some outcrops a subtle inclined planar surface cutting through the columns

is probably the same structure. Sets of narrow wispy carbonate filled gash veinlets occur in

the chilled margin dolerites in some holes. The chilled margin dolerite and contact hornfels

are especially brittle, in contrast to the juxtaposed ductile sediments, the carbonate veinlets

are often accompanied by intense fine blocky fracturing. Fault, fracture and joint structuring

are a major controlling factor on the frequency and depth penetration of alteration and

weathering.

7.2.3 Alteration

Two styles of hydrothermal alteration consistently occur in the dolerite drilled to date.

Volumetrically the more important style is vein mineralization contained in steeply dipping

fractures, which appear in most cases to be tectonically dilated cooling joints, and as matrix

infill in the fault zone breccias described above. The highest concentration of alteration

occurs within the fault zone and drops off dramatically outwards into the more competent

dolerite contained within the Central and West Resources. This alteration is believed to be

due to fluids generated during graben style deformation which are temporally associated with

the Tertiary age basaltic event.

The mineralogy comprising these fracture-fill veins consists of varying proportions of white

crystalline zeolites and carbonates combined with various green, cream-brown, white and pink

earthy phyllosilicate minerals. Rare vein quartz is associated with calcite. The earthy

minerals often exhibit a waxy lustre, enhanced on slickensided surfaces, indicating some post

veining movement. In general appearance the suite of earthy minerals resemble serpentine

but the lack of any evidence during logging of the viscosity expected from talc, or of fibrous

amphibole minerals, combined with an absence of serpentinisation of the dolerite wall rocks,

indicates that the minerals are probably mixed layer clays in the chlorite-illite–smectite group.

The relative proportions of crystalline vein minerals relative to earthy clay minerals filling

fractures, increases down hole and in particular increases below the base of oxidation,

indicating that some of the clay minerals may be weathering products.



Apart from a narrow zone immediately beneath the basal dolerite contact, pervasive alteration

is absent in the sediments underlying the dolerite. The presence of pervasive iron oxide in

sandstone below the contact, with no visible destruction of the primary sandstone texture, and

regional evidence of springs transmitting ground water along dolerite-sandstone contacts

demonstrate that sufficient porosity and permeability exist in the Triassic sandstones to host

hydrothermal alteration if fluids from a Tertiary age volcanic source had reached the dolerite.

The most likely origin of this alteration style is from metasomatic alteration of the dolerite,

localised in fractures formed on pre existing cooling joint planes of weakness, during

Cenozoic graben forming deformation and unroofing of the dolerite.

Alteration around the dolerite-sedimentary rock contact is contact metamorphic in style and

includes a fine grained, glassy, dark coloured chilled margin in the dolerite and an oxidized

hornfelsed sandstone or mudstone zone in the sediments near the contact. The total interval

of visible alteration either side of the contact ranges from approximately 1-10 metres in the 21

intercepts seen to date and in some cases is quite narrow and weak in intensity (Appendix 4),

which probably reflects the general low water content of dolerite magmas. The contact

alteration zone in some holes shows evidence of a Redox reaction with chloritisation in the

dolerite and limonite / hematitic oxidation of the sediments. Post intrusion deformation has

focused on the brittle-ductile contrast at the contact, with intense fine fracturing and calcite

veining common in the chloritic chilled dolerite.

7.2.4 Weathering

Weathering overprint on both fresh and altered dolerite is estimated by the presence of

secondary yellow-brown limonite identified during logging. Secondary mineralisation logged

as limonite will most likely also include iron stained clays and a range of iron hydroxide and

manganese oxide minerals, but the main aim is to log the dolerite drill core which has been

detrimentally affected by reaction with oxide forming low temperature waters. Because the

dolerite sill has been essentially conformable with the land surface since crystallisation and

weathering that is an ongoing process today, weathering intensity and penetration in general

decrease with depth and in detail depend on the interplay of structure and topography. The

most intense and deepest penetrating weathering occurs in fault zones in flat lying locations

between hills, whereas the least weathering occurs on topographic highs underlain by

competent dolerite.

Table 7.2.4_1 shows that pervasive weathering of the entire rock mass reaches a maximum

vertical depth of >32 metres in BB10-9 which was drilled within the East Fault zone, in

contrast to BB10-4, a vertical hole located in the middle of the Central Resource block, which

shows no pervasive weathering but has structurally contained limonite down to 116 metres.

The deepest penetration of limonite weathering in open joint structures was recorded in

vertical hole BB10-13, at 154.2 metres, and the shallowest base of structurally controlled

weathering is in vertical hole BB10-7, at 35.5 metres. It is likely that in zones of intense

jointing that the weathering extends to the dolerite-sedimentary contact.



Table 7.2.4_1


Drilling Summary Phase 1

Drill Hole ID Easting Northing Elevation Azimuth Dip

Dolerite- Sediment contact

Hole Length

Fault Zone Start

Fault Zone End

Start of Pervasive Limonite

End of Pervasive Limonite

Piezometer

BB10-01 492243.00 5447514.00 45 -55 129.35 74.85 164.3 0.00 36.80 0.00 0.00

BB10-02 492239.00 5447507.00 Vertical 90 130.35 69.4 134.9 0.00 in fault 0.00 0.00 45.7-51.7

BB10-03 492243.00 5447515.00 222 -54 129.27 59.5 164.2 0.00 77.20 0.00 0.00

BB10-04 492688.00 5447208.00 Vertical 90 215.03 125.5 161.8 na na 0.00 0.00 41.8-47.8

BB10-05 492926.00 5447262.00 Vertical 90 193.78 74.2 83.3 na na 0.00 28.00

BB10-06 492678.00 5447490.00 Vertical 90 191.37 91.9 98.6 na na 0.00 0.00

BB10-07 492566.00 5447669.00 Vertical 90 155.33 47.7 59.2 na na 0.00 0.00

BB10-08 492924.00 5447521.00 50 -55 191.38 110.5 118.2 0.00 50.00 0.00 5.00

BB10-09 492929.00 5447521.00 230 -55 191.71 13.4 63.6 0.00 63.60 0.00 40.00

BB10-10 492347.00 5447220.00 54 -55 144.74 119.4 125.5 0.00 59.40 0.00 3.00

BB10-11 492345.00 5447220.00 234 -54 144.55 130.2 134.4 0.00 92.80 0.00 12.00

BB10-12 492145.00 5447247.00 Vertical 90 158.37 138.8 143.4 na na 0.00 2.70

BB10-13 491973.00 5447472.00 Vertical 90 189.28 173.3 173.9 na na 0.00 1.50

BB10-14 491739.00 5447414.00 Vertical 90 142.75 133.65 134.9 na na 0.00 8.70

BB10-15 491577.00 5447647.00 Vertical 90 129.25 88.1 90.8 39.40 65.90 0.00 4.00

BB10-16 491863.00 5447184.00 Vertical 90 115.15 119.7 122.9 na na 0.00 0.00 22.8-28.8

BB10-17 492327.00 5447011.00 Vertical 90 146.89 87.7 90.2 na na 0.00 0.00

BB10-18 492062.00 5447716.00 230 -55 118.96 82.4 86.2 0.00 33.20 0.00 30.00

BB10-19 492523.00 5446903.00 230 -55 143.09 72.6 74.8 0.00 29.50 0.00 12.50

BB10-20 492526.00 5446902.00 50 -55 143.23 117.6 121.2 0.00 93.50 0.00 0.00

BB10-21 492343.00 5447222.00 50 -65 144.39 113.2 114.6 0.00 87.40 0.00 0.00



7.2.5 Petrology

Various combinations of thin section petrography, XRD (X-ray diffraction) mineral identification

and whole rock and trace element chemical analyses by XRF (X-ray fluorescence) and

ICPMS (Inductively Coupled Plasma Mass Spectrometry) were carried out on three field

samples during the mapping stage and 10 core samples during the drilling program. Two of

the three field samples were halved and sent to two separate petrologists (Ralph Bottrill, MRT,

Hobart and John Payne, consultant, Vancouver) to check the consistency of results from

different laboratories and to select the appropriate laboratory for the drill core sampling to

follow. Sampling schedules and summary results are shown in Appendix 10 on the

Geological Report Petrology Table and the various petrology reports.

The petrology results have provided a more quantitative overview of the composition of, and

variation within, the fresh dolerite comprising the main part of the resource. In addition, the

nature of structurally hosted dolerite alteration and the basal sill dolerite-sedimentary rock

contact are now better understood and together the results will enable a refinement in visual

logging interpretations during the Phase 2 drilling program. The dolerite and hornfelsed

sandstone samples examined independently by MRT and John Payne produced very similar

results so the logistical advantages of using a local petrologist and laboratory controlled the

choice of MRT as the preferred laboratory for the Phase 1 drill core samples.

The modal composition of fresh dolerite is consistent throughout the surface and core

samples tested, consisting of two clinopyroxenes, plagioclase, rare quartz and mesostasis in

the matrix position composed of quartz, potassium feldspar, plagioclase and iron oxide

opaques. No olivine crystals occur in the 10 thin sections of fresh solid dolerite examined to

date and the proportion of quartz is considered too low to contribute a useful fine silica

component to the aggregate products. The photomicrographs in Appendix 10 confirm the

crystal grain size trend decreasing down hole in BB10-11.

Relative to the main medium grained ophitic dolerite, the basal chilled margin zone shows

slight depletion of Cr and Ni and slight enrichment in the trace elements Ba, Ce, Cu, La, Sr, Y

and Zr, which are often associated with late stage concentration of volatile rich fractionation

product in a cooling magma. The chilled margin dolerite also contains 2-3 times the

concentration of Fe2O3 found in the main body of fresh dolerite but there is no difference in the

total Fe content. This anomaly suggests that Fe is crystallizing in the pyroxene lattice in the

main body of dolerite but is partitioned into magnetite and ilmenite in the chilled margin

dolerite. Increased fine magnetite disseminated through the mesostasis of the chilled margin

dolerite could explain the darker colour and higher magnetic susceptibility of these rocks. The

common light brown clinopyroxenes under plane polarized light in the medium and medium-

coarse dolerites are almost certainly iron bearing augites

XRD mineral identification of the vein style and breccia matrix style alteration confirms the

visual logging results of a suite of mainly cream and green earthy and minor white crystalline

minerals consisting of; mixed layer clays, zeolites and calcite, with traces of quartz and

feldspar. The mixed layer clay peaks, as a group on XRD, have been called smectites to



distinguish them from kaolinites and they will include mainly montmorillonite and probably

some chlorite. Zeolite species stilbite and laurmontite are identified and at least one other

unidentified zeolite is suspected in lower concentrations. Calcite is the only carbonate

identified in the alteration and it was identified microscopically. A strong FeO-Fe2O3

partitioning trend exists between fresh unaltered dolerite and weathered or brecciated and

altered dolerite where the alteration minerals are dominantly smectite group clays and

chlorite. The decomposition of augite has released iron which reforms as hydrous Fe2O3 in

limonite and smectite.

Overall the alteration consists of a narrow range of minerals with a chemistry suggesting

metasomatic alteration of the parent dolerite during deformation as the most likely origin. This

interpretation is consistent with the observation that alteration appears restricted to structures

and there is no evidence of pervasive mineral variation due to alteration in the body of the

dolerite resource.

Although minor re-crystallisation of quartz grains in sandstone underlying the dolerite has

been demonstrated both in field exposures and under the microscope, the 21 holes logged to

date conclusively show that contact thermal metamorphism of the sediments is patchy in

distribution and thin where it does occur. Nowhere in the prospect drilled to date does the

hornfels impart significant strength to the rocks underlying the dolerite.

The potential for detrimental contamination of aggregate products from relative enrichment of

certain major and trace elements, particularly in the mineralogy of the abundant altered

material in the Central Fault Zone, is discussed below in Section 13.6 Geochemistry of

Surface and Drill Core.

7.2.6 Rock Quality

Quantitative analytical test results on core samples are discussed in a later section of this

report but it is apparent during geological logging that the interplay between structural

geology, alteration and weathering enable a useful estimation of rock quality to be made. The

end member domains of fresh massive crystalline dolerite on the one hand, and pervasively

weathered, soft limonitic dolerite on the other hand, are clear cut in terms of assigning

portions of the deposit to “ore” and “waste” but between these end members the variable

intensity of structuring, alteration and weathering will determine how the rocks are classified.

Below the base of pervasive oxidation there typically occurs an interval of dolerite core where

limonitic weathering overprints structurally contained vein mineralization, which in turn

typically overlies an interval of fresh, structurally contained vein mineral alteration.

A visual assessment of the rock quality during core logging is possible through the following

procedure (Appendix 11, Tables A and B). One visually estimates the percentage of “good

quality dolerite” contained within the composite interval (Appendix 11, Table A). This is most

easily accomplished by estimating the percentage of clean, non limonite / clay bearing dolerite

in each core box within the composite interval. Examining the wet core photos is the quickest



and most efficient way of conducting this visual estimate. One then calculates the average

visual percentage of acceptable dolerite for the composite interval.

Laboratory results were then compared with composite visual estimates. If a composite

exceeded the Australian Standards Specification Limit requirements for the Coarse Fraction

Particle Density (>2.5t/m³) and Water Absorption (<2%), Sodium Sulphate Soundness (<9%)

and LA Abrasion Values (<30%), then it was considered “acceptable dolerite” and if it failed

one of these tests then it was considered “unacceptable dolerite”. A total of 15 “unacceptable

dolerite” composites yielded visual estimates that range from 11% to 68%, an arithmetic

average of 37% and standard deviation of 19.8%. A total of 20 “acceptable dolerite”

composites yielded visual estimates that range from 26% to 99%, an arithmetic average of

78% and standard deviation of 19.7%.

If a composite visual estimate of acceptable dolerite is <57%, then the analytical result will not

likely meet the Australian Standard Specification Limit requirements for the Coarse Fraction


and LA Abrasion Values (<30%).

If a composite visual estimate of good dolerite is >57%, then the analytical result will likely

exceed the Australian Standard Specification Limit requirements for the Coarse Fraction


and LA Abrasion Values (<30%).

Detail regarding the arithmetic averages and the length weighted averages of acceptable

dolerite composites from Geological Domains and Resources is contained in Table 7.2.6_1

and Appendix 11. It is concluded that the West, Central and East Resources have a length

weighted average of between 75% and 84% acceptable dolerite. The length weighted

average of acceptable dolerite within the Fault Zones ranges from 10% to 28%.

Table7.2.6_1

Delta Materials pty ltd Bell Bay Quarry Project

Summary of Visual Estimate (%) of Acceptable Qualit y Dolerite within Geological Domains

Domain or Geological Resource Arithmetic Average (%)

Length Weight Average (%)

Dolerite & Weathered Dolerite – West, Central & East Resources 78% 81% Dolerite & Weathered Dolerite – West Resource 80% 83% Dolerite & Weathered Dolerite – Central Resource 75% 77% Dolerite & Weathered Dolerite – East Resource *84% *84% Central Fault Zone 28% 27% East Fault Zone 10% 19% Dolerite & Weathered Dolerite – West, Central & East Resources 78% 81% *one sample



8 DEPOSIT TYPES

The Bell Bay Quarry Project dolerite deposit is a Jurassic age, primary magmatic intrusive sill

of tholeiitic composition. The sill is hosted in a sequence of Triassic fluvial sandstones,

siltstones and mudstones of which only the basal sill contact is preserved. Geochemically the

deposit has affinities with the Continental Flood Basalt class of basaltic magmas and

tectonically its origin results from crustal extension, sagging and rifting of the Gondwana

continent. The current structural setting of the deposit mainly results from post continental

break up graben style faulting and extension, linked to the formation of continental shelves

around the island of Tasmania.

Dolerite is a rock being quarried and crushed to make construction material for the concrete

and road building industries. Commercial dolerite/gabbro quarries have supplied material to

the Sydney market.



9 MINERALIZATION

The mineralization of economic importance is fresh unaltered crystalline dolerite consisting

mainly of augite-pigeonite clinopyroxene, calcium rich plagioclase and a glassy mesostasis of

mixed feldspars and quartz. In general the rock is medium grained with an ophitic texture but

ranges from coarse grained graphic textured to fine grained and slightly porphyritic. Minor

fracture-contained vein style zeolite, carbonate, chlorite, clay alteration minerals and fracture-

contained limonitic weathering products are included in the resource mineralization.



10 EXPLORATION

10.1 Introduction

Delta developed an exploration program to define the continuity and physical and chemical

characteristics of the Bell Bay dolerite within the proposed quarry area. The exploration

program consisted of the following elements:

� Detailed mapping of outcrops.

� Materials testing of a composite grab sample from the TasPort quarry.

� Drilling 21 HQ3 and NQ2 sized diamond drill holes totalling 2,460.9 metres. The 10

inclined and 11 vertical diamond drill holes were drilled to the dolerite-sedimentary

contact.

� Detailed geological and geotechnical logging of core.

� Materials testing of composite representative core samples.

� Thin-section petrographic studies.

� Geochemical analysis of selected surface and core samples.

Pre-drilling exploration consisted of a program of outcrop mapping by Delta geologists, Alex

Boronowski, Ken Morrison and Ray Hazeldene, and a ground gravity / magnetics survey by

geophysical contractors, Atlas Geophysics Pty. Ltd. and Southern Mineral Exploration

Geophysics Pty. Ltd. (SMEG). Philip Muir, the principal of SMEG supervised the geophysical

survey.

10.2 Chronological Exploration Overview

Subsequent to Delta receiving EL6/2009, a large surface grab sample was collected from the

quarry owned by Tasmanian Ports Corporation (TasPort). The TasPort quarry is situated

immediately to the west of the West Fault and West Resource. The analytical results from the

composite sample were encouraging and the large hills to the east of the TasPort quarry,

which are now referred to as the West and Central Resources were believed to be composed

of similar dolerite. A brief examination westward of the TasPort quarry showed dolerite

outcropped to the railway line at approximately 25masl and then again outcropped at

tidewater. Therefore, it was assumed that the dolerite in the Central and West Resource

areas would extend to and possibly below sea level.

The first exploration program in October 2009 consisted of geological mapping. The mapping

indicated that dolerite outcropped along the ridges and the flanks of topographic highs.

During the initial period of mapping, the low areas were prospected but only dolerite float was

discovered. Therefore, it was hypothesized that the dolerite sill extended to sea level and

probably beyond. It was not until the discovery of sub-outcropping metamorphosed

sandstone (UTM 492450E, 5447400N) to the north of the proposed resource area that is



became apparent that the proposed quarry may contain sandstone believed to have similar

strike and dip to Triassic sediments along the Bridport Road (120°/15°SW). Based on these

observations it was decided to conduct a reconnaissance gravity/magnetics survey over the

area of interest to determine whether there was an indication of a large quantity of sediment at

depth. The gravity profiles suggested that the maximum thickness of the dolerite within the

resources is trending approximately east-west. It could not be determined whether a large

volume of sediment occurred above sea level in the area-of-interest.

The magnetics and drainage patterns suggests that the faults trend generally northwest-

southeast (dominant trend) and east-west (secondary trend). Southerly trending drainages

located to the south and east of the Central Resource changes direction abruptly to a west

trending drainage, which suggests faulting has diverted the course of the creeks. The

magnetic response suggests that the Central Fault has a dextral sense of motion with

displacement of approximately 450 metres.

There is no outcrop along the surface trace of the Central Fault, which follows the fire break

road nor is there outcrop along the trace of the East Fault which follows a creek bed. The

inferred East-West Faults 1 and 2 follow drainage trends.

The structural mapping recorded cooling and tectonic joints trending north-south, east-west,

northwest-southeast and northeast-southwest. The orthogonal joint sets and faults dip

steeply (-85°).

The first three drill holes were collared within the Central Fault Zone. Two angled holes

passed through the Central Fault into the adjacent Central and West Resources and the

vertical hole intersected the dolerite-sandstone contact at 70m depth. Two of the holes were

continued down to sea level in order to determine whether only one sill existed and to

determine the rock quality characteristics of the sediments. The fault zone is approximately

80m wide and contains relatively poor quality material, which is presently classified as waste.

The fault zone contains deleterious weathering materials such as limonite and iron oxides

clays and hydrothermal alteration minerals such as smectite, chlorite, zeolites and

carbonates. The vein style hydrothermal alteration minerals are believed to be related to

Tertiary age graben deformation in the Tamar Valley.

Subsequently, the drill moved to the centre of the Central Resource where the thickest section

of good quality dolerite was believed to occur. The dolerite-sedimentary contact was

intersected at 94masl. At this point, the drilling program was altered from a combination of

angled and vertical holes to mainly vertical holes in order to determine whether there was

sufficient tonnage and quality of dolerite to support an economic quarry.

Originally, the proposed quarry was expected to be contained within the Central Resource.

However, additional drilling indicated that the dolerite-sedimentary contact was well above sea

level and the thickness of dolerite averaged approximately 100 metres. Therefore, the

management team decided that the exploration program needed to be expanded westward to



incorporate the area now known as the West Resource. The Exploration Work Program was

amended to include a program consisting of excavating drill sites, roads/tracks and a drilling

program on the West Resource. Environmental and Archaeological surveys were conducted

as part of the permitting process.

It was important to understand more fully the trend and dip of the Central Fault since it would

form a waste barrier between the two resources. Therefore, a total of 8 angled holes were

collared in the fault zone and drilled into the adjoining resources. The contact between the

fault zone and adjoining dolerite is generally easily recognized in core and the quality of the

rock improves away from the fault into the adjoining resources. The intensity and spacing of

jointing drops off away from the fault, as observed in core photos and in the visual estimate of

acceptable quality dolerite within geological domains and resources. The fault is

approximately 80 metres wide, trends 330° and dips near vertically.

MRT approved the modified Exploration Work Program and drilling commenced on the West

Resource. Several widely spaced vertical holes determined that the tonnage and quality of

the dolerite in the West Resource was suitable for construction material.

The Phase 1 drilling program has demonstrated that the dolerite sill is bowl-like at the basal

contact with apparent dips ranging from 8°to 13° to the southwest. The dolerite is cut by the

northwest-southeast trending faults with a dextral strike slip displacement of approximately

450m and an apparent minor west side up displacement. It is not known whether this minor

displacement is due to the more important dextral motion or whether there is a small vertical

displacement.

The majority of the holes in the West and Central Resources are vertical holes. The vertically

dipping joint directions are north-south, east-west, northwest-southeast, and northeast-

southwest. All joint sets dip vertically. The vertically drilled holes intersected these joint sets.

Locally, the structures are open and contain unfavourable weathering products. It is

recommended that the proposed Phase 2 drilling program comprise mainly angled holes at

grid azimuth 050° and 230° in order to intersect the joint sets most effectively and to obtain a

better cross section of the resources and more representative samples for analytical testing.

10.3 Geological Mapping Method

The fire break road is the main access to the property. Numerous old, narrow tracks/roads

were utilized for access during the mapping program and then excavated for the Phase 1

drilling program.

Vegetation is relatively thin and outcrop exposure along ridges and the flanks of ridges ranges

from 50% to 70%. Few outcrop exposures occur along fault traces and areas of low relief.

The West Knob which contains the TasPort dolerite quarry is believed to be representative of

the quality of material and structural controls exhibited throughout the proposed Bell Bay



Quarry Project area. The TasPort quarry was mapped in detail to understand the deposit

type.

Delta geologists Alex Boronowski and Ken Morrison mapped the project between October 7

and 22, 2009. Geological and geotechnical features were mapped on outcrops and data were

collected at 214 sites.

Mapping was done on a 1:5,000 scale orthophotograph with 5m elevation contours. The

orthophotograph was produced by Eagle Mapping of Port Coquitlam from colour aerial

photography flown on February 14, 2006 at a photo scale of 1:24,000. Mapping locations

were determined with non-geodetic grade, hand-held Global Positioning Systems (GPS).

GPS accuracy is ±5 metres.

Outlines of outcrops were drawn on the orthophotograph during mapping. Geological and

geotechnical data were recorded directly on tabular data sheets or notebooks using the Knight

Piésold geotechnical manual, “Field Procedures Manual – Geotechnical Data Collection for

Exploration Geologists” (Appendix 12).

10.4 Joint Mapping

Jointing is the dominant rock quality feature observed in the dolerite. Delta measured Rock

Quality Designation (RQD) and joint orientations at all surface geological data points and

performed detailed logging of joint condition, number of joints and RQD measurements on drill

core.

The dolerite is a very competent rock with an average RQD measured from outcrop of

approximately 97%. The tectonic joints demonstrate more persistence than the

discontinuous, curved, cooling joints. The curved cooling joints dip steeply.

Five joint trends have been identified in the project area (Table 10.4_1)

Table10.4_1


Summary of Joint Trend Groups

Joint Trend Azimuth Dip

1 Approximately North-South 85° east and minor dips to the west 2 Approximately East-West 85° north and minor dips to the south 3 Approximately Northwest-Southeast 85° Northeast a nd Southwest 4 Approximately Northeast-Southwest 85° Northwest a nd Southeast 5 270° 15° to 45° South



The two orthogonal joint sets (north-south and east-west) and (northwest-southeast and

northeast-southwest) dip vertically. The joints show an average spacing in outcrop from 2cm

to 60cm. The joints range from being tight to slightly open.

The flat lying joints were mapped in the TasPort Quarry and recognized in the core. These

joints are widely spaced (5-10 m) and dip 15°- 47° south.

The relatively close spacing of the steeply dipping orthogonal joint sets may cause elongation

of the fine and coarse fragments. The optimal blast hole pattern and explosive type will need

to be determined in order to produce the best combination of feed to the primary crusher,

reduce costs associated with secondary breakage and limit production fines. Designing the

commercial crusher specifically for the Bell Bay dolerite should maximise the production of

cubic fragments.

10.5 Geophysics

A reconnaissance gravity-magnetics survey was conducted by Atlas Geophysics and

supervised by Philip Muir of SMEG to determine whether a significant quantity of sediment

occurs beneath the dolerite and above sea level. Figure 10.5_1 shows the geophysical

gravity survey profiles superimposed upon the aeromagnetics. The detailed Gravity Survey

Report by Philip Muir is contained in Appendix 8.

Figure 10.5_1


Gravity survey Profiles Superimposed on the Aeromag netics



The survey consisted of 4 lines orientated at 045° with 500 and 600 metre line separation and

gravity readings taken at nominal interval of 50m along the central two lines and 100m along

most of the outer two lines.

It was difficult to interpret the gravity profiles since the choice of density for the sandstone and

dolerite was assumed to be 2.4t/m3 and 2.9t/m3, respectively. Recently, the apparent particle

density for the coarse fraction sandstone was determined to be 2.5t/m³. This increase in

density for the sediment is believed to have the net effect of increasing the dolerite thickness

on the existing profiles by approximately 30%. This estimate is based on information from the

gravity survey which concluded that with “an increase of 0.1 tonnes/m³ in sandstone bulk

density (ie. a decrease in the density difference between dolerite and sandstone) an

approximate 30% increase in dolerite thickness was required to maintain a reasonable match

between observed and calculated gravity measurements”.

The original profiles suggested that there would be good potential for sediments occurring

above sea level within the area-of-interest, which was proven correct during the Phase 1

drilling program. However, the thickness of dolerite intersected did not normally match the

thickness of dolerite shown on the gravity profiles, which may in part be due to variations in

the density of the sediment.

The survey correctly determined that the apparent dip of the base-of-the dolerite was between

10° and 15° SW.

The magnetic data is very noisy and not considered useful for the purpose of interpreting

dolerite thickness.



11 DRILLING

11.1 Drilling Program

A program of 21 fully cored diamond drill holes was completed on the quarry project area

during an 11 week campaign from March-May, 2010. Delta contracted Edrill Pty Ltd, from

Somerset, Tasmania to drill the holes, using a track-mounted Sandvic UDR 200 rig

(Figure 11.1_1). The drill rig was supported by a tracked Marooka and 4WD utilities for

transporting drill pipe, fuel, drilling consumables and personnel. The drilling operation worked

in two 10 hour shifts per day and used a wheeled trailer style, generator powered lighting unit

for night shift. All holes were drilled on flat pads excavated into regolith materials, together

with in-ground drilling water sumps, prior to the arrival of the drill rig.

Figure 10.5_1

Delta Materials Bell Bay Quarry Project

Sandvic UDR 200 Diamond Drill Rig and Support Vehic le

The 21 drill holes (BB10-1 to BB10-21) totalled 2460.9 metres of HQ3 (61.1 mm diameter

core) and NQ2 (50.6 mm diameter core). All holes started with HQ3 (triple tube) until solid

and relatively fresh rock was encountered, then HWT casing was run in and the hole was

completed in NQ2. Core samples submitted for analytical testing were halved NQ2 and HQ3

samples.



The Phase 1 drilling program is summarized in Table 7.2.4_1. Drill core and magnetic

susceptibility logs are in Appendix 4. Eleven holes were drilled vertically and ten holes were

inclined (nine at a dip of -55 and one at -65). All 10 inclined holes were drilled from either the

Central or East Fault Zones into the Central, West and East Resources. Three of the vertical

holes (BB10-2, 10-4 and 10-16) were established as piezometer water bores with 50 mm ID

slotted PVC tubes.

The location of the drill hole collars was determined using a non-geodetic grade GPS. Drill

holes ranged in length from 59.2 m to 173.9 metres. A Reflex EZ shot survey instrument was

used for down-the-hole surveying. No significant deviations were noted.

Geological and geotechnical logging was performed by Alex Boronowski, Ken Morrison and

Ray Hazeldene. Logging was performed at the George Town, Thompson Avenue core shed;

where the core is being stored. Core recovery was generally good. The arithmetic average for

1,321 calculations is 94%.

11.2 Core Logging

Core was logged using the Knight Piésold geotechnical manual, “Field Procedures Manual-

Geotechnical Data. The following features were logged:

� drilled interval

� core recovery

� rock quality designation (RQD)

� geological description

� weathering

� hardness

� rock type

� colour

� texture

� alteration style

� alteration mineralization

� alteration strength

� structure type

� alpha angle

� beta angle

� structure filling



� comments

� geotechnical data

� structure type

� alpha angle

� beta angle

� aperture

� roughness

� infill material

� weathering

� comment

RQD values for the Dolerite and Weathered Dolerite of the East, Central and West Resources

indicate a rating of 13 out of 20. For all 25 composites from the 19 drill holes testing the

resources the RQD averages 63% with a standard deviation of 32%. The core recovery

averages 98% for the 25 composites measured.

Coffey Inspected drill core for holes BB10-1, BB10-2 and BB10-20 and BB10-21 during the

site visits in March and June of 2010. Coffey found the logging to be of high quality.

11.3 Drill Summary and Interpretation

The following section summarizes and interprets the Phase 1 drilling program. Detailed

analytical results are discussed in section 13.

The drilling results indicate that the slightly bowl shaped dolerite sill dips approximately 10° -

15° to the southwest. The dolerite sill has a maximum apparent thickness of 170 m (Sections

2000E and 1250S).

The Bell Bay Quarry Resources are bounded by the NW–SE trending East, Central and West

Faults, the E-W trending EW1 & 2 Faults and the NE–SW trending EW1 Fault. A total of 8

angled holes and 1 vertical hole have tested the Central Fault Zone and determined that the

fault zone dips vertically and has a slightly sinuous NW–SE trend. The Central Fault Zone

averages approximately 80 m wide. The material within the fault zone consists of weathered,

altered, sheared and brecciated dolerite. Weathering and alteration minerals within the fault

zone consist predominantly of clays, iron oxides and zeolites and lesser amounts of chlorite

and carbonate. The weathering and alteration is closely associated with the vertical joint sets

mapped on surface and observed in the drill core. The joints sets are filled predominantly with

clay, limonite and manganese oxide within the weathered zone and beneath the base of

oxidation, lesser amounts of smectite, zeolite, chlorite, carbonate and quartz. The East Fault



Zone has been tested by two drill holes and the apparent strike, width and mineralogy is

similar to the Central Fault Zone. The West Fault Zone has not been drilled.

The dolerite sill generally grades from coarse to fine grained towards the sedimentary contact.

The chilled dolerite contact when observed ranges from 0.3 m to 32 m.

A total of 43 composite samples were submitted for various tests to determine the suitability of

the dolerite for use as a construction material in concrete and bitumen. The test results

indicated the material within the fault zone did not normally meet Australian Standards

Specification Limit requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and

Water Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values

(<30%). However, approximately 27% of the fault zone material consists of relatively good

dolerite, which may be separated from the finer fault gouge material and used as construction

material or other industrial applications.

11.3.1 Central Resource

The Central Resource which is bounded by faults has been tested by 4 vertical holes within

the resource and by 4 angled holes drilled from the Central Fault Zone into the resource and

by 1 angled hole drilled from the East Fault Zone into the resource. Vertical hole BB10-5

located in the southeast corner of the resource yielded results for a weathered dolerite

composite from surface to 27.8 m that did not meet Australian Standards Specification Limit

(ASSL) requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and Water

Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30%).

However, the composite from 27.8 m to the sedimentary contact exceeded the ASSL

requirements for the above tests due to a significant decline in fracture density of the dolerite

below 27.8 m (core photos, Appendix 5). The extent of this pocket of poorer quality material

can only be determined by drilling and possibly by a geophysical resistivity survey. BB10-9

drilled from the East Fault Zone towards the Central Resource may not have intersected the

Central Resource. The material within the drill hole consisted of alternating sediments and

dolerite which is unsuitable for construction material and therefore was not submitted for

testing. BB10-20 drilled from the Central Fault Zone towards the Central Resource,

intersected dolerite in the resource that did not meet ASSL requirements for Water Absorption

(<2%) and Sodium Sulphate Soundness (<9%). The remainder of the angled holes and

vertical holes within the Central Resource produced composite test results that exceeded the

ASSL requirements for the above four important tests. There is the possibility that there will

be a margin of potentially poorer quality material adjacent to the bounding faults of the Central

Resource. This margin or sections of the margin with poorer quality material and surface

pockets of poorer quality material within the Central Resource will be defined during the

Phase 2 drilling and geophysics exploration program.

11.3.2 West Resource

The West Resource, which is bounded by faults, has been tested by 6 vertical holes within the

resource and by 4 angled holes drilled from the Central Fault Zone into the resource. Vertical



hole BB10-15, located in the northwest corner of the resource, yielded results from a

composite consisting of dolerite with weathered sections of dolerite from surface to 86.4 m

that did not meet the ASSL requirement for the Sodium Sulphate Soundness (<9%) test. The

10.8% Sodium Sulphate Soundness result is believed to be due to deleterious material within

a zone of closely spaced vertical joints. Vertical hole BB10-12, located in the centre of the

resource yielded results from a composite consisting of dolerite with weathered sections of

dolerite from surface to 28.8 m that did not meet the ASSL requirement for the Sodium

Sulphate Soundness (<9%) test. The 15.6% Sodium Sulphate Soundness result is believed

to be due to joints and veins containing chlorite, carbonate, clay, zeolite, limonite, manganese

and minor quartz. BB10-19, drilled from the Central Fault Zone towards the West Resource,

intersected dolerite in the resource that did not meet ASSL requirements for Water Absorption

(<2%). The Water Absorption value of 2.6% is probably due to excessive amounts of

sandstone, clays and alteration products in the fault zone interval from surface to 29.5 metres.

The composite submitted for testing may have had better analytical results for the portion of

the composite in the West Resource, if the composite had been split into two composites,

12.5 – 29.5 m for the fault zone and 29.5 – 72.6 m for the portion in the West Resource. The

remainder of the angled holes and vertical holes within the West Resource yielded composite

test results that exceeded the ASSL requirements for the above tests.

11.3.3 East Resource

The East Resource has been tested by one angled hole from the East Fault Zone. The

composite test results exceeded the Australian Standards Specification Limit requirements for

the Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption (<2%), Sodium

Sulphate Soundness (<9%) and LA Abrasion Values (<30%).

11.3.4 Drll Hole Summary

BB10-1

The hole is positioned in the Central Fault Zone at a collar elevation of 129 m and drilled -55°

towards 045°. Between 0 and 36.8 m the hole inters ected a fault zone consisting of

completely to moderately weathered and sheared dolerite. Alteration and weathering

minerals consist of clay, zeolite, chlorite and limonite. At 36.8 m the hole passed out of the

fault zone into relatively fresh, jointed dolerite of the Central Resource. The chilled dolerite

contact consisting of fine grained, magnetic, dark dolerite occurs between 74.6 m and 74.85

m (0.25 m). At 74.85 m sandstone and minor amounts of mudstone, siltstone and

conglomerate were intersected to the end of the hole at 164.3 metres.

The hole was drilled to sea level in order to determine whether more than one sill existed and

to determine the quality and characterization of the sediments. Only one dolerite sill was

intersected. The dolerite yielded analytical results exceeding the Australian Standards

Specification Limit (ASSL) requirements for the Coarse Fraction Particle Density (>2.5 T/m³)

and Water Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values

(<30%).



BB10-2

The vertical hole is positioned in the Central Fault Zone adjacent to BB10-1. The hole

intersected weathered and sheared dolerite from surface to 69.4 m and then intersected

sandstone and minor mudstone to the bottom of the hole at 134.9 metres. Alteration minerals

include clay, zeolite, chlorite and limonite formed by weathering and hydrothermal processes.

One composite (0-28 m) collected from the fault zone yielded analytical results exceeding

ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption

(<2%) and LA Abrasion Values (<30%). The other composite (28-69.4 m) yielded a value of

16.5% for the Sodium Sulphate Soundness (<9%) test, which does not meet the ASSL

requirement. The high value is probably due to alteration minerals within the fault zone.

BB10-3

The hole is positioned in the Central Fault Zone adjacent to drill holes BB10-1 & 2 and drilled -

54° towards 222°. Between 0 and 32.6 m the hole in tersected a fault zone consisting of

completely to moderately weathered and sheared dolerite. At 32.6 m the hole passed out of

the fault zone into relatively fresh, jointed dolerite of the West Resource. The chilled dolerite

contact consisting of fine grained, magnetic, dark dolerite occurs between 56 m and 59.9 m

(3.9 m). At 59.5 m sandstone and minor amounts of mudstone were intersected to the end of

the hole at 164.3 metres.

The dolerite intersection within the West Resource (32.6-59.5 m) yielded analytical results

exceeding ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and Water

Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30%)

(Tables 9&12).

The Central Fault Zone width as defined by the fault contacts in BB10-1 & 3 is approximately

80 m wide.

BB10-4

This vertical hole is positioned in the centre of the Central Resource at a collar elevation of

215 metres. The hole intersected from surface to 125.5 m, good quality dolerite exceeding

the ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and Water

Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30%)

(Tables 9&13). The chilled dolerite contact consisting of fine grained, magnetic, dark dolerite

occurs approximately between 124.6 m and 125.5 m (0.9 m). From 125.5 m to the bottom of

the hole at 161.8 m occurs siltstone and minor sandstone.

BB10-5

This vertical hole is positioned in the southeast corner of the Central Resource at a collar

elevation of 194 metres. The hole intersected weathered dolerite from surface to 27.8 m and

then good dolerite from 27.8 m to 74.1 m. The weathered dolerite represents a zone of

closely spaced vertical joints with significant amounts of infill weathering clays. Analytical



results for the weathered dolerite composite did not meet Australian ASSL requirements for

the Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption (<2%), Sodium

Sulphate Soundness (<9%) and LA Abrasion Values (<30%). The good dolerite from 27.8 m

to 74.1 m exceeded ASSL requirements for the coarse fraction Particle Density (>2.5 T/m³)

and Water Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values

(<30%). The chilled dolerite contact consisting of fine grained, magnetic, dark dolerite occurs

between 59.4 m and 74.1 m (14.7 m). From 74.1 m to the bottom of the hole at 83.3 m occurs

sandstone.

The good dolerite (27.8-74.1 m) exceeds significantly the ASSL requirements and therefore it

is believed that the vertical hole drilled down an open set of joints that contained clays in the

weathered dolerite portion of the hole (0 - 27.8 m).

BB10-6

This vertical hole is positioned in the east side of the Central Resource at a collar elevation of

191 metres. The hole intersected weathered dolerite from surface to 29.5 m and then good

dolerite from 29.5 m to 91.9 metres. Analytical results for the weathered dolerite and the good

dolerite composites exceed the ASSL requirements for the Coarse Fraction Particle Density

(>2.5 T/m³) and Water Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA

Abrasion Values (<30%). The chilled dolerite contact consisting of fine grained, magnetic,

dark dolerite occurs between 91.5 m and 91.9 m (0.4 m). From 91.9 m to the bottom of the

hole at 98.1 m occurs sandstone and minor rip up clasts of mudstone.

BB10-7

This vertical hole is positioned along the north edge of the Central Resource at a collar

elevation of 155 metres. The hole intersected weathered dolerite from surface to 20.9 m and

then good dolerite from 20.9 m to 40.7 m. Analytical results for the weathered dolerite and the

good dolerite composites exceed the ASSL requirements for the Coarse Fraction Particle

Density (>2.5 T/m³) and Water Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA

Abrasion Values (<30%). From 91.9 m to the bottom of the hole at 98.1 m occurs sandstone

and minor rip up clasts of mudstone. The chilled dolerite contact consisting of fine grained,

magnetic, dark dolerite occurs between 46 m and 47.7 m (1.7 m).

BB10-8

This hole is positioned in the East Fault Zone adjacent to drill holes BB10-9 at a collar

elevation of 191 m and drilled -55° towards 050°. Between surface and 50 m the hole

intersected a fault zone consisting of weathered and sheared dolerite. At 50 m the hole

passed out of the fault zone into relatively fresh, jointed dolerite of the East Resource. The

chilled dolerite contact consisting of fine grained, magnetic, dark dolerite occurs between

109.8 m and 110.5 m (0.7 m). At 110.5 m sandstone and minor amounts of siltstone were

intersected to the end of the hole at 118.2 metres.



The dolerite intersection within the East Resource (50 – 110.5 m) yielded analytical results

exceeding the ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and


(<30%).

BB10-9

The hole is positioned in the East Fault Zone adjacent to drill holes BB10-8 at a collar

elevation of 191 m and drilled -55° towards 230°. Between surface and the end of the hole at

63 m the hole intersected sheared and weathered dolerite, sediments and minor dark

aphanitic dolerite dyke or possible chilled contact dolerite, which suggests that several fault

panels were intersected within the fault zone. The hole was believed to have passed out of

the fault zone into the Central Resource; however, cross section 1750S indicates that the end

of the hole is approximately 12 m above the extrapolated dolerite-sedimentary contact and still

in sediments which suggests that the hole was still within the fault zone. No composites were

collected from the drill core because of the poor quality of the weathered and altered dolerite

and sediments within the fault zone and no significant continuous interval of dolerite. The

East Fault zone width as defined by the assumed fault contacts in BB10-8 & 9 is

approximately 80 m wide.

BB10-10

The hole is positioned in the Central Fault Zone at a collar elevation of 114 m, adjacent to drill

holes BB10-11 & 21 and drilled -55° towards 054°. Between 0 and 52.5 m the hole

intersected a fault zone consisting of weathered and sheared dolerite containing clays and

zeolites with horizontal slickensides supporting evidence of dextral strike slip fault movement.

At 52.5 m the hole passed out of the fault zone into relatively fresh, jointed dolerite of the

Central Resource. The chilled dolerite contact consisting of fine grained, magnetic, dark

dolerite occurs between 119.1 m and 119.4 m (0.3 m).

At 119.4 m sandstone and siltstone were intersected to the end of the hole at 125.5 metres.

The dolerite intersection (52.5 – 119.4 m) within the Central Resource yielded analytical

results exceeding the Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption

(<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30%).

BB10-11

The hole is positioned in the Central Fault Zone adjacent to drill holes BB10-10 & 21 and

drilled -55° towards 234°. Between 0 and 93 m the hole intersected a fault zone consisting of

weathered, sheared and brecciated, coarse grained dolerite containing clays and zeolites and

minor chlorite-carbonate alteration associated with the brecciated dolerite. At 93 m the hole

passed out of the fault zone into relatively fresh, fine to medium grained, jointed dolerite of the

West Resource. The chilled dolerite contact consisting of fine grained, magnetic, dark dolerite

occurs between 109 m and 130.2 m (21.2 m). At 130.2 m sandstone and mudstone were

intersected to the end of the hole at 134.4 metres.



The dolerite intersection (93 – 130.2 m) within the West Resource yielded analytical results

exceeding the ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and


(<30%).

The Central Fault Zone width as defined by the fault contacts in BB10-10, 11 & 21 is

approximately 90 m wide. The Central Fault is dipping >85° to the east and west as measured

on section and from drill core alpha angles, respectively.

BB10-12

The vertical hole is positioned in the centre of the West Resource at a collar elevation of 158

metres. The hole intersected weathered dolerite from surface to 28.8 m and then good

dolerite from 28.8 m to 138.8 m. The chilled dolerite contact consisting of fine grained,

magnetic, dark dolerite, occurs between 107 m and 138.8 m (31.8 m). From 138.8 m to the

bottom of the hole at 143.4 m occurs sandstone and mudstone. The sandstone contact is

oxidized suggesting the sandstone is a permeable water course.

Analytical results for the weathered dolerite composite (0 – 28.8 m) exceed the ASSL

requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption

(<2%) and LA Abrasion Values (<30%), but failed the limit requirement for the Sodium

Sulphate Soundness (<9%) by yielding a result of 15.6%. The poor Sodium Sulphate

Soundness result is believed to be due to joints and veins containing chlorite, carbonate, clay,

zeolite, limonite, manganese and minor quartz.

The dolerite composite (28.8 – 138.8 m) exceeded the ASSL requirements for all of the above

mentioned tests.

BB10-13

The vertical hole is positioned in the north-centre portion of the West Resource at a collar

elevation of 189 metres. The hole intersected good quality, solid, medium grained dolerite

from surface to 173.3 metres. Analytical results for the two dolerite composites exceed the

ASSL requirements for the Coarse and Fine Fractions Particle Density (>2.5 T/m³) and Water

Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30). From

173.3 m to the bottom of the hole at 173.9 m occurs sandstone.

BB10-14

This vertical hole is positioned to the west of BB10-13 close to the western limits of the West

Resource at a collar elevation of 143 metres. The hole intersected good quality, solid,

medium grained dolerite from surface to 133.65 metres. Minor clay and chlorite alteration is

associated with the vertical joints. Analytical results for the dolerite composite exceed the

ASSL requirements for the Coarse and Fine Fractions Particle Density (>2.5 T/m³) and Water

Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30). From




BB10-15

The vertical hole is positioned approximately 20 m outside the northwest corner of the West

Resource at a collar elevation of 129 metres. The hole intersected medium grained dolerite

and minor dolerite breccias from surface to 86.4 metres. Clay, zeolite and chlorite alteration is

associated with the vertical joints and brecciated dolerite. The chilled dolerite contact

consisting of fine grained, dark dolerite occurs between 86.4 m and 88.1 m (1.7 m). From


Analytical results for the dolerite composite exceeded the ASSL requirements for the Coarse

Fraction Particle Density (>2.5 T/m³) and Water Absorption (<2%), and LA Abrasion Values

(<30), but failed for Sodium Sulphate Soundness (<9%) by yielding a result of 10.8%, which is

probably a result of the hydrothermal alteration mineral assemblage.

BB10-16

This vertical hole is positioned in the west-central portion of the West Resource at a collar

elevation of 115 metres. The hole intersected coarse grained dolerite from surface to 34 m

and then medium grained dolerite to 119.87 metres. Minor amounts of clay and chlorite

alteration is associated with the vertical joints and minor brecciated dolerite. The chilled

dolerite contact consisting of fine grained, dark dolerite occurs between 117.3 m and 119.87

metres (2.57 m). From 119.87 m to the bottom of the hole at 122.9 m occurs mudstone and

sandstone.

Analytical results for the dolerite composite (0 – 119.87 m) exceeded the ASSL requirements

for the Coarse and Fine Fractions Particle Density (>2.5 T/m³) and Water Absorption (<2%),

Sodium Sulphate Soundness (<9%), and LA Abrasion Values (<30).

BB10-17

This vertical hole is positioned in the southeast corner of the West Resource at a collar

elevation of 147 metres. The hole intersected coarse grained dolerite from surface to 21.2 m

and then medium grained dolerite to the chilled contact adjacent the dolerite-sedimentary

contact at 87.7 metres. Minor amounts of clay and chlorite, hematite, zeolite alteration is

associated with the vertical joints. The chilled dolerite contact consisting of fine grained, dark

dolerite occurs between 85.4 m and 87.7 m (2.3 m). A 1 cm band of clay occurs immediately

below the chilled dolerite contact and the underlying sandstone demonstrating that the

dolerite-sedimentary contact is an aquifer horizon. From 87.71 m to the bottom of the hole at

90.2 m occurs sandstone.

Analytical results for the dolerite composite (0 – 87.7 m) exceeded the ASSL requirements for

the Coarse and Fine Fraction Particle Density (>2.5 T/m³) and Water Absorption (<2%),

Sodium Sulphate Soundness (<9%), and LA Abrasion Values (<30).



BB10-18

The hole is positioned in the Central Fault Zone along the northern boundaries of the Central

and West Resources. The hole is collared at 119 m and drilled -55° towards 230°. Between 0

and 33.2 m the hole intersected the fault zone consisting of weathered and sheared coarse

grained dolerite containing clays, zeolites and minor chlorite alteration associated with vertical

joints. At 33.2 m the hole passed out of the fault zone into medium grained, jointed dolerite

which becomes fresher and less jointed with depth into the West Resource. The chilled

dolerite contact consisting of fine grained, magnetic, dark dolerite occurs between 81.1 m and

82.4 metres (1.3 m). At 82.4 m sandstone and interbedded shales were intersected to the

end of the hole at 86.2 metres.

The dolerite intersection (33.2 -82.4 m) within the West Resource yielded analytical results

exceeding the ASSL requirements for the Coarse and Fine Fraction Particle Density (>2.5

T/m³) and Water Absorption (<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion

Values (<30%).

BB10-19

The hole is positioned in the Central Fault Zone adjacent to BB10-20 and along the southern

boundaries of the Central and West Resources. The hole is collared at 143 m and drilled -55°

towards 230°. Between 0 and 29.5m the hole interse cted the fault zone consisting of

weathered and sheared medium grained dolerite containing clays, zeolites and minor chlorite

alteration associated with vertical joints. At 29.5 m the hole passed out of the fault zone into

medium grained, jointed dolerite of the West Resource. This interval contained a 0.3 m wide

and a 0.2 m wide interbed of sandstone. At 72.6 m the hole intersected sandstone to the end

of the hole at 74.8 metres.

This is the only drill hole where thin beds of sediment were encountered within the dolerite.

The dolerite composite interval from 12.5 m to 72.6 m yielded analytical results exceeding the

ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³), Sodium Sulphate

Soundness (<9%) and LA Abrasion Values (<30%) but failed for the Water Absorption (<2%)

with a test result of 2.6%. The Water Absorption value of 2.6% is probably due to excessive

amounts of sandstone, clays and other alteration products in the fault zone interval from

surface to 29.5 metres. The composite submitted for testing may have had better analytical

results for the portion of the composite in the West Resource, if the composite had been split

into two composites, 12.5 – 29.5 m for the fault zone and 29.5 – 72.6 m for the portion of the

composite in the West Resource.

BB10-20

The hole is positioned in the Central Fault Zone adjacent to BB10-19 and along the southern

boundary of the Central and West Resources. The hole is collared at 143 m and drilled -55°

towards 050°. Between surface and 93.5m the hole i ntersected the fault zone consisting of

weathered, sheared and brecciated, coarse to medium grained dolerite containing zeolites,

carbonates and chlorite alteration associated with vertical joints. At 93.5 m the hole passed



out of the fault zone into medium to fine grained, jointed dolerite of the Central Resource. The

chilled dolerite contact consisting of fine grained, magnetic, dark dolerite is apparent at 104.7

m and continues to 117.6 metres (12.9 m). The dolerite from surface to the sedimentary

contact grades from coarse to fine grained. At 117.6 m the hole intersected sandstone with

sand beds fining upward. The hole was stopped at 121.2 metres.

The dolerite composite (93.5 – 117.6 m) from the Central Resource yielded analytical results

exceeding the ASSL requirements for the Coarse Fraction Particle Density (>2.5 T/m³), LA

Abrasion Values (<30%) but did not meet requirements for the Water Absorption (<2%) and

Sodium Sulphate Soundness (<9%) where results yielded 2.8% and 12.8%, respectively. The

high Water Absorption value of 2.8% and Sodium Sulphate Soundness value of 12.8% is

probably due to excessive amounts of clays and other alteration products within the joints

adjacent to the Central Fault. Jointing frequency decreases eastward away from the fault

zone contact.

BB10-21

The hole is positioned in the Central Fault Zone at a collar elevation of 144 m, adjacent to drill

holes BB10-10 & 11 and drilled -65° towards 050°. The purpose of this hole was to tag the

Central Fault contact approximately 30 m below the fault contact intersection in BB10-10.

The two relatively sharp fault contacts indicate a dip of 85° to the east and the contact alpha

angle measured in BB10-21 indicated 85° to the west . It is not unusual for vertical dipping

faults to meander slightly along strike and dip directions. An eastward dipping NW-SE Central

Fault Zone is compatible with the NW-SE and N-S joint sets which dip steeply to the east.

Another test was conducted to compare composites obtained from continuous sampling

versus individual representative samples combined to create a composite sample. This is

analogous to a continuous channel sample versus a non-continuous chip channel sample.

Refer to section 14.2 Drill core sampling for more detail regarding composite core sampling

procedure.

The entire core in BB10-21 was cut in half in order to obtain a continuous composite sample.

The two fault zone composites and the dolerite composite from BB10-21 were compared to

the fault zone composite and dolerite composite from BB10-10 since the holes are relatively

close together and therefore should be the best comparison available. There does not appear

to be any significant difference in results between sampling a continuous composite and

combining individual representative samples to produce a composite.

BB10-21 between surface and 87.5 m intersected the Central Fault zone which consists of

weathered, sheared and brecciated coarse to fine grained dolerite containing predominantly

clays and zeolites and lesser amounts of chlorite and carbonate hydrothermal alteration

minerals associated with vertical joint sets. The horizontal slickensides on the zeolite are

supporting evidence for the strike slip fault movement. At 87.5 m the hole passed out of the

Central Fault zone into relatively fresh, jointed, medium to fine grained dolerite of the Central

Resource. The dolerite grades from coarse at surface to fine at the sedimentary contact. The



chilled dolerite contact consisting of fine grained, magnetic, dark dolerite occurs between

112.5 m and 113.2 metres (0.7 m). At 113.2 m mudstone and sandstone were intersected to

the end of the hole at 114.6 metres.

The two continuous composites from BB10-21 and the composite from BB10-10, collected

from material within the Central Fault Zone, yielded results that did not meet for Water

Absorption (<2%) and Sodium Sulphate Soundness (<9%). BB10-21 yielded results of 6.2%

and 6.4% for Water Absorption and 17.9% and 23.4% for Sodium Sulphate Soundness.

BB10-10 yielded results of 4.0% for Water Absorption and 26.5% for Sodium Sulphate

Soundness. The results are similar for both sampling procedures.

The two continuous composites from BB10-21 and the composite from BB10-10, collected

from the dolerite within the Central Resource, yielded analytical results exceeding ASSL

requirements for the Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption

(<2%), Sodium Sulphate Soundness (<9%) and LA Abrasion Values (<30%).

BB10-21yielded an Apparent Particle Density of 2.84 T/m³, Water Absorption of 0.5%, Sodium

Sulphate Soundness of 3.7% and LA Abrasion Value of 15%. BB10-10 yielded an Apparent

Particle Density of 2.88 T/m³, Water Absorption of 1.6%, Sodium Sulphate Soundness of

4.6% and LA Abrasion Value of 13%. The Water Absorption and Sodium Sulphate

Soundness values are slightly higher in BB10-10 which can be attributed to more weathering

products since the intersection is closer to surface. Nevertheless, both composites exceed

ASSL requirements.



12 SAMPLING METHOD AND APPROACH

12.1 Quarry and Outcrop Sampling

Delta collected a >100 kg composite grab sample (Sample A) from the Tasmanian Ports

Corporation Pty Ltd (TasPort) quarry, which was the source of armour rock for their Bell Bay

port site. This is the only location on the property where relatively fresh dolerite could be

obtained for a suite of tests to determine the suitability of the material for the construction

industries.

Delta submitted the samples to Testrite Construction Materials Testing of Concord West,

NSW, which was subsequently purchased by Coffey Information of Warabrook, NWS.

Coffey/Testrite performed tests on Sample A as detailed in Table 12.1_1.

Table 12.1_1


Tests Conducted on TasPort Quaryy Grab Samle (Sampl e A)

Australian Standards Description Specification Lim its AS1141.11 Washed Grading

-20mm + 4.75 mm -4.75mm

AS1141.12 obtained from AS1141.11 Materials finer than 75µm (%)

<4%

AS1141.22 Wet/Dry Strength Wet Strength ≥100kN Dry Strength >150kN Wet/Dry Variation ≤25% AS1141.14 Particle Shape 2:1 and 3:1 ≤10% AS1141.23 LA Abrasion – K Grading ≤30% AS1141.24 Sodium Sulphate

Soundness ≤6%

AS1141.6.1 Coarse Aggregate Particle Density & Water Absorption

<3.2T/m3 & ≥2.1T/m3 ≤2%

AS1141.5 Fine Aggregate Particle Density & Water Absorption

<3.2T/m3 & ≥2.1T/m3 ≤2.5%

AS1141.26 Secondary mineral content ASTMC295 Petrographic Examination RTA T363 Alkali Reactivity <0.15 for fine

aggregate AS1141.41,41 PAFV 14mm ≥48 AS1289.3.1.1 Plasticity Index –liquid limit ≤20 AS1289.3.2.1 Plasticity Index –plastic limit ≤20 AS1289.3.3.1 Plasticity Index Non-plastic (RTA Spec

– manufactured sand AS1289.3.4.1 Linear Shrinkage 0= confirms clay

content negligible AS1141.50 Resistance to Stripping RTA <10% stripped Ok AS1012.2 Concrete Trial Mix Report



Table 12.1_1


Tests Conducted on TasPort Quaryy Grab Samle (Sampl e A)

Australian Standards Description Specification Lim its AS1012.9 Compressive strength

Report

AS1012.13 Drying Shrinkage Report AS1012.20 Acid Soluble Chloride

AS1379 <0.8kg/m3 chloride Cl

AS1012.20 Acid Soluble Sulphate

AS1379 <5% by wt of cement binder

NZS3111 Flow Cone and Voids Test Is a shape indicator not a compliance measure

Results are discussed in Section 13.

12.2 Drill Core Sampling

The drill core was delivered by the drillers upon completion of their shift to the core yard at

Delta’s storage facility at 23 Thompson Avenue, George Town (Figure 12.2_1). Upon arrival,

Michael Cook or Bruce Stark of Ron Gregory Prospecting Pty Ltd examined the core for core

presentation errors, marked the core intervals and labelled the core boxes. They then

calculated the core loss and RQD values, which were checked by the Delta geologists while

logging the core. The core was logged for geological and geotechnical defect information.

After logging the core the geologist would mark the sample intervals for each composite and

then the core was photographed dry and wet.

The location of sample intervals for each composite was determined by the following method.

The number of core boxes within the composite was determined and then a calculation was

made to determine the amount of half-core required from each box in order to obtain a

minimum composite weight of approximately 60 kilograms. The following is an example of the

method used to determine how much material was required to obtain a 60 kg of sample. If the

composite sample interval represented 20 NQ2 core boxes (NQ2 core measures 50.6 mm in

diameter), then one metre of core (SG 2.9) weighs approximately 5.9 kg. Therefore, 20

metres of half-core will be required from the 20 boxes to supply the minimum required 60 kg

composite. This equates to a minimum 1.0 metre representative half-core sample from each

of the 20 boxes.

Each representative interval making up the composite was marked and then cut in half with a

rock/core saw (Figure 12.2_2). One half was placed in a labeled sample bag and the other

half retained in the core box for reference. Each sample bag was weighed to ensure that a

minimum of >60 kg had been collected for the composite. More detail regarding the



procedure for determining and collecting composite samples from drill core can be obtained

from the sample data sheet within the master drill log (Appendix 4).

Figure 12.2_1


Delta Core Yard at GeorgeTown



Figure 12.2_2


Core Saw at Delta Core Yard, GeorgeTown

Tables 12.2_1 and 12.2_2 indicate the composite categories and tests conducted on the 43

composite samples.

The labelled bags containing the composites were double checked before shrink wrapping

and strapping of the pallets for shipment to the Coffey/Testrite Laboratory in Warabrook,

NSW. The drill core boxes are being stored at the locked storage facility at 23 Thompson

Avenue, George Town.

Coffey/Testrite performed the following tests (Table 12.2_2) on 39 of the 43 composite

samples. The remaining 4 composites were analyzed for the Polished Aggregate Friction

Value (PAFV).



Table 12.2_1


Summary of Composite Samples

Composite Category No. of

Composites collected

Description

1. Dolerite 19 good sound dolerite from within a resource area

2. Weathered Dolerite 6 usually from an upper portion of the drill core located within a resource area

3. Fault Zone 13 consisting of weathered, fault gouge and dolerite within the fault zone

4. Sediment 1 underlying the dolerite Special Composites

Fine grained representative material from BB10-4 and BB10-12

2 fine grained dolerite for Polished Aggregate Friction Value

Medium grained representative material from BB10-4 and BB10-12

2 medium grained dolerite for Polished Aggregate Friction Value

Comparing continuous sampling of a composite interval (BB10-21) to representative sampling of a composite interval (BB10-10), which is analogous to continuous channel sample versus a non-continuous chip channel

sample. BB10-21- Fault Zone, weathered material (included in

above) Continuous sampling of a composite interval is equivalent to a channel-type sample

BB10-21 - Fault Zone, dolerite (included in above)

Continuous sampling of a composite interval is equivalent to a channel-type sample

BB10-21 - Dolerite

(included in above)

Continuous sampling of a composite interval is equivalent to a channel-type sample

Total composites 43



Table 12.2_2


Tests Conducted on Composite Samples

Australian Standards Description Specification Lim its AS1141.11 Washed Grading

-20mm + 4.75 mm -4.75mm

AS1141.12 obtained from AS1141.11 Materials finer than 75µm (%) <4% AS1141.22 Wet/Dry Strength & Variation Wet Strength ≥100kN Dry Strength ≥150kN Wet/Dry Variation ≤25% AS1141.14 Particle Shape 2:1 ≤35% AS1141.23 LA Abrasion – K Grading ≤30% AS1141.24 Sodium Sulphate Soundness ≤6% for concrete exposure

class C ≤9% for concrete exposure class B1 & B2

AS1141.6.1 Coarse Aggregate Particle Density & Water Absorption

<3.2T/m3 & ≥2.1T/m3 ≤2%

AS1141.5 Fine Aggregate Particle Density & Water Absorption

<3.2T/m3 & ≥2.1T/m3 ≤2.5%

AS1012.20 Acid Soluble Chloride

AS1379 <0.8kg/m³ chloride Cl or <0.033%

AS1012.20 Acid Soluble Sulphate

AS1379 <5% by wt of cement binder in concrete

AS1141.42 Polished Aggregate Friction Value <44

The results for the above tests are discussed in Section 13.



13 SAMPLE PREPARATION, ANALYSES AND SECURITY

13.1 Introduction

Sample preparation protocols follow methods specified for the individual Australian Standards

tests as shown in Table 12.2_2. From these results three tests were considered most critical

for determining suitability of the dolerite for construction material. The three selected tests,

Particle Density and Water Absorption for Coarse Aggregate (AS1141.6.1), Sodium Sulphate

Soundness test (AS1141.24), and the Los Angeles Abrasion Resistance test (AS1141.23)

were selected as the critical economic parameters for defining the resource.

13.2 Particle Density and Water Absorption for the Coarse Aggregate Test Protocol

AS1141.6.1 test determines the absorption of water on coarse aggregate and the bulk specific

gravity. Bulk specific gravity is determined dry and “saturated-surface dry” (is an apparent

bulk specific gravity). Bulk Specific Gravity is the ratio of the mass of a unit volume of

aggregate to the mass of the same volume of water at a stated temperature. The saturated-

surface dry bulk specific gravity and absorption are determined after soaking the aggregate in

water for 24 hours. Absorption refers to the increase in weight of aggregate due to water in

the pores of the material, but not including water adhering to the outside surface of the

particles, and is expressed as a percentage of the dry weight of the aggregate sample. The

aggregate is considered dry when it has been maintained at a temperature of 110 ± 5°C for a

time sufficient to remove all uncombined water. A sample of the crushed aggregate is first

sieved to remove all material less than 4.75 mm. A 5 kg sample is required for 38 mm (1½ in)

aggregate. The sample is immersed in water at room temperature for 24 hours. The sample

is then removed from the water and rolled in an absorbent cloth to remove all surface water.

The dried sample is then weighted in air and then weighed in water. The sample is then dried

at 110 ± 5°C and re-weighed. Results are reported to the nearest 0.01% moisture.

13.3 Sodium Sulphate Soundness Test Protocol

Sodium Sulphate soundness tests on Bell Bay dolerite samples were performed on coarse

aggregate specimens. These are crushed rock from which sizes smaller than 4.75 mm have

been removed. Remaining coarse particles are split into varying mesh sizes.

These materials are subjected to saturation and drying in a supersaturated solution of sodium

sulphate for five cycles. The samples are then washed with a barium chloride solution and

dried to a consistent weight at 110°C. The dried s ample is sieved again and the loss

measured as the change in total weight of all sieve sizes combined relative to the original

weight.

13.4 Los Angeles Abrasion Test Protocol

The Los Angeles Abrasion test determines the resistance of crushed rock to production of

fines from abrasion and impact with steel balls. Sample preparation consists of crushing the

rock and splitting the sample to produce varying sieve sizes.



Samples meeting these specifications are placed in a cylindrical mill with twelve 46.8 mm

steel spheres and the mill turned 500 revolutions. The weight of minus 1.7 mm fines

produced in this process is then measured and reported as a percentage of the original mass.

13.5 Point Load Measurements

Delta measured the Point Load Strength Index of surface rock and diamond drill core samples

to determine the relative strengths of dolerite within the proposed quarry. Point Load Strength

Indices were calculated according to ASTM Designation D5731-95, “Standard Test Method

Determination of the Point Load Strength Index of Rock.” Delta used a Geotechnical Systems

Australia Point Load Test Apparatus, Load Cell: Cadeanco Serial Number 4508, Readout

System Cadeanco Serial Number 6500-0242, Loading System GSA P/L Serial Number 0242,

Range 0 to 50 kN from Coffey, who supplied an operations manual for the Point Load Test

Apparatus and macro spreadsheet for computing the Point Load Strength Index and

associated Strength Designation. The instrument has been calibrated and the next calibration

is recommended before 11th May 2012.

The point load testing procedure consists of placing a sample between two platen contact

points, measuring the distance between the platens and then applying a loading force via a

hydraulic jack to the contact points until the sample breaks. The breaking point (failure load)

is measured on a calibrated dial as, kilo-Newtons (kN). The measured platen separation (D)

and the failure load (P) are entered into the spreadsheet in order to compute the Point Load

Strength Index (Is) in MN/m² and the correlating Strength Designation increments between

Very Low (R1) and Extremely High (R6).

Delta tested drill core samples at regular intervals or when changes in rock type occurred. A

total of 900 core samples were tested from 393 HQ3 and 507 NQ2 core samples in BB10-1 to

BB10-21 having drill core diameters of 61.1 and 50.6 mm, respectively. Axial and diametrical

core tests were conducted on the core samples. The axial core test consists of placing the

ends of the core in contact with the platens. The length/diameter ratio should be between 0.3

and 1.0 for the axial test. The diametrical core test consists of placing the diameter of the

core in contact with the platens. The total length of the core sample should be longer than the

diameter of the core (L>0.5D), where L is half of the length of the core and D is the diameter

of the core. Delta tested rock surface samples from the Tasmanian Port Quarry where the

specimen size ratio of depth/width was between 0.3 and 1.0.

13.6 Geochemical Analysis

Delta submitted to Testrite Laboratory a >100kg composite grab sample from the TasPort

quarry for a suite of analytical tests (Table 13.7_1). Delta submitted five surface rock samples

for various chemical analyses including 38 element fusion Induced Coupled Plasma Atomic

Adsorption – Mass Spectrometer (ICP-MS), whole rock package – X-ray Fluorescence (XRF),

and X-ray Diffraction analysis (XRD). The surface samples submitted for geochemical

analyses were splits of rock samples sent to John G. Payne of Vancouver Petrographic

Laboratory and R.S. Bottrill of Mineral Resources Tasmania Laboratory.



13.7 Results – Surface Samples

A large >100 kg composite grab sample was collected from the TasPort Quarry prior to

commencing an exploration program to determine whether the dolerite underlying the

Exploration Licence was suitable as construction material for the Sydney market.

Table 13.7_1 demonstrates that the dolerite rock exceeds the Australian Standards

Specification Limit requirements for all of the analytical tests.

The dolerite produced very good results in the LA Abrasion test, with fines at 13%, which is

well below the specification limit of <30% and competitive for materials available in the

Sydney market.

The sodium sulphate soundness test produced 0.10% loss, which is significantly below the

specification limit of ≤6% for concrete exposure classification C or ≤9% for concrete exposure

classification B1 and B2. The rock is very stable in a sulphate rich environment.

Weight percent water absorption is 0.40% for the coarse aggregate fraction and 1.1% for the

fine aggregate fraction. The specification limit for water absorption for the coarse and fine

aggregate fraction is ≤2.0% and ≤2.5%, respectively. These results are indicative of fine

grained dolerite rock.

The Particle Density in SSD for the coarse fraction, which is utilized for concrete mix design,

is 2.96T/m³ which is within the specification limits of normal weight <3.2T/m³ and ≥2.1T/m³.

The Particle Density in SSD for the fine fraction is 2.92T/m³ which is within the specification

limits of normal weight <3.2T/m³ and ≥2.1T/m³. The two results are comparable to the central

coast basalts supplying the Sydney market.

Point load test results for three valid dolerite samples from the quarry and two valid dolerite

outcrop samples from the area-of-interest produced a total of two Extremely High rock

strengths and three Very High rock strengths. Three basalts from outside the property were

tested for comparison and the tests produced two Extremely High and one High rock strength.



Table 13.7_1


TasPort Quarry Sample Results (Page 1 of 2)



Table 13.7_1


TasPort Quarry Sample Results (Page 2 of 2)



13.8 Results – Drill Core

Table 12.2_2 lists the material test results for the drill core composite sampling of Dolerite,

Weathered Dolerite, Fault Zone and Sediment. Detail regarding the intervals sampled for

each composite is contained within the drill logs (Appendix 4).

The drill composites were classified into the following four categories:

Dolerite – this material occurs within the resource and is good quality dolerite without any

significant weathering or deleterious minerals.

Weathered Dolerite - this material occurs within the resource and represents the weathered

dolerite in the near surface portions of the drill holes and the more strongly jointed dolerite

adjacent to the fault zones.

Fault Zone – this material is considered waste because it contains deleterious minerals.

However, there are weathered dolerite lozenges and sections of good dolerite within the fault

zone which may be separated by dry sieving and then utilized for crushed material or

specialty stone.

Sediment - this material represents the Triassic age sediments underlying the dolerite. One

composite was collected from BB10-1 and analyzed to determine the rock quality.

In summary, the only test results that did not exceed the Australian Standards Specification

Limit (ASSL) requirements were the length weighted average water absorption of the fines for

combined fresh and weathered dolerite by yielding 2.59% and 2.54% for the Central Resource

and combined East, Central and West Resources respectively. It is believed that the Fine

Fraction Water Absorption values will improve and exceed specification limits during

production due to extracting deleterious materials in the processing of the fine fraction

material.

The length weighted average has been used to estimate the global average. All length

weighted average tests conducted on dolerite from the West and Central Resources

exceeded ASSL requirements. Poorer quality material when present in the West, Central,

and East Resources is associated with Weathered Dolerite and represents the weathered

dolerite in the near surface portions of the drill holes and the more strongly jointed dolerite

adjacent to the fault zones.

Material from the East and Central Fault Zones is considered to be waste.

It is believed that all of the material within the Central and West Resources can be mined and

processed to produce a construction material suitable for the Sydney concrete and road

building industries.



13.8.1 Dolerite Results from the East, Central, and West Resources

Table 13.8.1_1 shows drill core composite results for fresh dolerite from the areas-of-interest

being developed as economic resources.

The arithmetic average and length weighted average values for the Coarse and Fine fraction

Particle Density results exceed the ASSL requirements for use as concrete and road

construction material.

The arithmetic average value of 2.62% for the Fine Fraction Water Absorption test did not

meet the ASSL of <2.5%; however, the 2.34% length weighted average value, which is

believed to be more representative of the material being tested, did exceed the requirements.

It is believed that the Fine Fraction Water Absorption values will improve and exceed

specification limits during production due to improvements in the processing of the fine

fraction material. The arithmetic and length weighted averages for the Coarse Fraction Water

Absorption exceed the ASSL requirements.

The arithmetic average and length weighted average of 3.26% and 2.67%, respectively, for

the Sodium Sulphate Soundness results exceed the ASSL requirements of ≤6.0% for

concrete exposure classification C and ≤9.0% for concrete exposure classification B1 and B2.


the LA Abrasion Losses results exceed the ASSL requirements of <30%.



Table 13.8.1_1


Bell Bay Quarry Project - Summary of Fresh Dolerite Results for the West, Central and East Resources



13.8.2 Dolerite and Weathered Dolerite Results from the East, Central, and West Resources

Table 13.8.2_1 shows drill core composite results of fresh and weathered dolerite from the

areas-of-interest being developed as economic resources.

The arithmetic and length weighted average values for the Coarse and Fine Fraction Particle

Density results exceed the ASSL requirements for use as concrete and road construction

material.

The arithmetic average and length weighted average values of 2.98% and 2.59%,

respectively, for the Fine Fraction Water Absorption test do not meet the Australian AASL of

<2.5%. It is believed that the Fine Fraction Water Absorption values will improve and exceed

specification limits during production due to improvements in the crushing and processing of

the fine fraction material. The arithmetic average and length weighted average for the coarse

fraction exceed the Specification Limit requirement of <2%.


the Sodium Sulphate Soundness results exceed the ASSL requirements of ≤6.0% for

concrete exposure classification C and ≤9.0% for concrete exposure classification B1 and B2.


the LA Abrasion Losses results exceed the ASSL requirements of <30%.



Table 13.8.2_1


Bell Bay Quarry Project - Summary of Fresh and Weat hered Dolerite Results for the West, Central and Ea st Resources.



13.8.3 Dolerite and Weathered Dolerite Results from the West Resource


Western area-of-interest being developed as an economic resource.

All of the tests yielded arithmetic and length weighted average values that exceed the ASSL

requirements for use as concrete and road construction material.

To date, the West Resource appears to have better quality material than the Central or East

Resources.



Table 13.8.3_1


Bell Bay Quarry Project - Summary of Fresh and Weat hered Dolerite Results for the West Resource.



13.8.4 Dolerite and Weathered Dolerite Results from the Central Resource


Central area-of-interest being developed as an economic resource.

The arithmetic average and length weighted average values for the Coarse and Fine Fraction

Particle Density results exceed the ASSL requirements for use as concrete and road

construction material.

The arithmetic and weighted average values of 2.93% and 2.54%, respectively, for the Fine

Fraction Water Absorption results did not meet the ASSL of <2.5%. It is believed that the Fine

Fraction Water Absorption values will improve and exceed specification limits during

production due to improvements in the crushing and processing of the fine fraction material.

The arithmetic and length weighted averages 1.53% and 1.29%, respectively, for the Coarse

Fraction Water Absorption exceeds the ASSL requirements.

The arithmetic average of 6.85% for the Sodium Sulphate Soundness result does not meet

the ASSL requirements of ≤6.0% for concrete exposure classification C. However, the length

weighted average of 5.54% exceeds the ASSL requirements of ≤6.0% for concrete exposure

classification C and ≤9.0% for concrete exposure classification B1 and B2.

The arithmetic and length weighted averages of 14.56% and 13.89%, respectively, for the LA

Abrasion Loss results exceed the ASSL requirements of <30%.



Table 13.8.4_1


Bell Bay Quarry Project - Summary of Fresh and Weat hered Dolerite Results for the Central Resource.



13.8.5 Geotechnical Results

A Geotechnical Review by Don Miller of Coffey Mining and Delta’s point load testing results

are contained in Appendix 7.

Point load tests on 900 core samples produced the results shown in Table 13.8.5_1. Results

show that the Bell Bay dolerite dominantly has a Very High to Extremely High Strength Index.

Values from drill core are consistent with surface samples.

Table 13.8.5_1


Point Load Test Results holes BB10-1 to BB10-21

Description Strength Classification Number of Sampl es Percentage of Samples

HQ3 core R6-Extremely High 188 53.3%

HQ3 core R5-Very High 120 34.0%

HQ3 core R4-High 33 9.4%

HQ3 core R3-Medium 12 3.3%

HQ3 core R2-Low 0 0

HQ3 core R1-Very Low 0 0

NQ2 core R6-Extremely High 196 41.6%

NQ2 core R5-Very High 229 48.7%

NQ2 core R4-High 35 7.4%

NQ2 core R3-Medium 11 2.3%

NQ2 core R2-Low 0 0

NQ2 core R1-Very Low 0 0

57 samples 57 NA

19 invalid samples 19 NA (R3=1, R4=3, R5=13, R6=20)

The Rock Quality Designation, Core Recovery and Point Load testing indicated that the

Dolerite and Weathered Dolerite Results for the West, Central and East Resources were as

follows:


� RQD averages 63%, which yielded a rating of 13. Together with the other criteria (Intact

Rock Strength, Joint Spacing, Joint Condition and Groundwater) in the Rock Mass Rating

Classification System produced a rating of between 60 and 80 which is described as

Good on a five division scale ranging from Very Poor to Very Good.

� Point Load testing results indicate that 97% of the core tested has a strength

classification of R4 High to R6 Extremely High.



The average RQD and joint frequency (joints per metre) measured from drill core for the

West, Central and East Resources are listed in Table 13.8.5_2. The numbers of joints per

metre are underestimated.

Table 13.8.5_2


RQD and Joint Frequency – Diamond Drill Core

Drill Hole Average RQD Joints per metre BB10-1 58 1.7 BB10-3 23 0.7 BB10-4 56 1.0 BB10-5 48 0.5 BB10-6 68 0.5 BB10-7 58 0.5 BB10-8 60 0.4 BB10-10 53 0.5 BB10-11 93 0.8 BB10-12 63 0.6 BB10-13 81 0.5 BB10-14 62 0.5 BB10-15 59 0.5 BB10-16 80 0.5 BB10-17 68 0.5 BB10-18 82 0.5 BB10-19 51 0.7 BB10-20 59 0.7 BB10-21 68 0.5 BB10-1 58 1.7 BB10-3 23 0.7

13.9 Results - Geochemistry of Surface Samples and Drill Core Samples

Geochemical results from surface samples are shown in Table 13.9_1. Geochemical

analyses of surface samples show no elevated levels of elements that may be deleterious to

aggregate.



Table 13.9_1


Geochemical Results – Surface Samples

Wt.% BBR-001 BBR-002

Elements ppm

Det. limit

492480E 5447050N

BBR-001 BBR-002

SiO2 52.82 51.81 52.70 Ag <1 TiO2 0.5 0.38 0.47 As 3 3 bdl Al2O3 14.18 15.47 15.42 Ba 5 197 130 180 Fe2O3 8.94 1.23 0.87 Bi 1 1 bdl FeO 6.60 6.80 Ce 5 20 12 18 MnO 0.18 0.16 0.15 Co 2 47.9 40 42 MgO 8.81 8.58 8.07 Cr 1 220 195 190 CaO 11.23 12.20 11.68 Cs 3 0.65 3 bdl Na2O 1.41 1.46 1.52 Cu 2 64 56 58 K2O 0.62 0.47 0.62 Dy 3.18 P2O5 0.072 0.05 0.06 Er 2.11 SO3 0.04 0.04 Eu 0.72 Cr2O3 0.03 Ga 1 14 15 14 SrO 0.02 Gd 2.75 BaO 0.01 Hf 2 CO2 0.10 0.20 Ho 0.67 H2O+ 1.06 1.26 La 6 9.9 bdl 7 TOTAL 99.78 99.61 99.85 Lu 0.3 L.O.I. 0.96 0.43 0.70 Mo 1 <2 bdl bdl S 0.01 0.01 Nb 1 4.6 5 5 Cl 0.001 0.001 Nd 7 10.6 bdl 10 Ni 2 114 100 100 Pb 2 6 5 6 Pr 2.67 Rb 1 23.7 21 26 Sb 2 bdl bdl Sc 2 40 39 Sm 2.48 Sn 2 1 bdl bdl Sr 1 133 120 135 Ta 0.3 Tb 0.5 Th 2 2.36 2 3 Tl <0.5 Tm 0.3 U 1 0.64 bdl bdl V 2 263 210 220 W 2 2 1 2 Y 1 20.2 14 19 Yb 1.92 Zn 1 71 58 63 Zr 2 71 57 73



Tabl 13.9_2 shows that samples from the intensely weathered and brecciated parts of the

deposit, with clay mineral and zeolite alteration (P004, P009), are heavily depleted in calcium

and sodium and elevated in chloride by an order of magnitude relative to fresh unaltered and

undeformed dolerite. This is most likely due to the breakdown of plagioclase into mixed layer

clays with their high water and chloride fixing capacity and supports the visual logging

classification of these rocks as waste material.

In contrast the fracture fill zeolite-calcite vein style of alteration hosted in fresh solid dolerite

(P008) does not deviate significantly from the whole rock composition of totally unaltered

dolerite, supporting the view that moderate amounts fresh veining are acceptable in the

resource.

If the elevated chloride in samples P004 and P009 is representative of weathered and

structurally deformed dolerite across the deposit it is likely that a conductivity contrast with

fresh solid dolerite exists, and that a resistivity survey could potentially map the extent of the

weathered dolerite.

The trace element chemistry shows no elevated concentrations likely to be deleterious to

aggregate products.



Table 13.9_2


Geochemical Results – Drill Core Samples

Wt % P001 P002 P003 P004 P005 P006 P007 P008 P009 P010

SiO2 52.94 53.31 53.31 53.20 53.12 53.78 54.18 51.73 57.06 54.22 TiO2 0.45 0.51 0.50 0.48 0.51 0.55 0.61 0.49 0.36 0.61 Al2O3 14.04 14.87 15.13 12.15 14.07 14.78 14.62 13.61 15.56 14.69 Fe2O3 0.58 0.92 1.00 6.33 0.78 0.80 1.92 3.95 7.92 1.99 FeO 7.20 7.30 7.00 1.80 8.10 7.70 7.20 5.40 0.30 7.00 MnO 0.18 0.16 0.16 0.27 0.18 0.16 0.17 0.15 0.03 0.18 MgO 9.92 8.16 8.29 10.97 8.21 7.83 7.02 8.98 5.70 6.93 CaO 11.03 10.98 11.24 4.82 11.32 10.89 10.35 9.81 1.37 10.22 Na2O 1.41 1.68 1.60 0.43 1.67 1.70 1.96 1.25 0.47 1.71 K2O 0.62 0.68 0.66 0.65 0.68 0.74 0.88 0.56 0.55 0.80 P2O5 0.06 0.07 0.07 0.07 0.07 0.08 0.09 0.06 0.01 0.09 Cl (%) 0.003 0.003 0.002 0.016 0.002 0.002 0.002 0.003 0.040 0.006 CO2 0.20 0.10 0.10 1.10 0.10 0.10 0.20 <0.1 0.10 0.10 S <0.01 <0.01 <0.01 <0.01 <0.01 0.01 <0.01 <0.01 <0.01 <0.01 SO3 <0.02 <0.02 <0.02 <0.02 <0.02 0.02 <0.02 <0.02 <0.02 <0.02 H2O+ 0.95 0.88 0.95 7.68 1.27 1.06 1.00 3.99 10.32 1.40 SUM 99.58 99.62 100.01 99.95 100.08 100.19 100.20 99.98 99.75 99.94 L.O.I. 0.35 0.17 0.27 8.58 0.47 0.33 0.40 3.39 10.39 0.72 ppm As <3 <3 3 <3 <3 <3 <3 <3 <3 <3 Ba 155 175 170 125 175 210 240 150 86 220 Bi <1 1 1 1 1 1 1 2 <1 2 Ce 13 14 21 10 15 22 23 18 6 23 Co 44 42 42 59 42 42 43 46 26 43 Cr 350 240 250 320 48 190 135 370 305 120 Cs <3 3 4 <3 5 <3 7 8 4 <3 Cu 57 69 65 55 64 77 82 67 63 82 Ga 13 15 14 11 15 15 16 13 20 16 La <6 7 <6 <6 <6 <6 14 12 <6 8 Mo <1 <1 <1 <1 <1 <1 <1 <1 <1 <1 Nb 3 6 4 6 4 6 5 5 5 7 Nd 11 <7 <7 9 <7 8 15 9 <7 12 Ni 130 100 105 130 91 94 83 135 91 78 Pb 3 5 6 4 5 4 6 4 2 5 Rb 25 29 28 24 27 30 37 28 18 31 Sb <2 <2 <2 <2 <2 <2 2 <2 3 <2 Sc 42 42 40 45 45 42 43 45 44 43 Sn <2 <2 <2 2 <2 <2 2 <2 3 <2 Sr 95 110 110 78 115 125 180 130 31 145 Th <2 <2 2 <2 <2 <2 2 <2 <2 <2 U <1 2 1 <1 <1 <1 2 1 <1 2 V 230 240 220 150 260 230 250 210 91 250 W <2 <2 <2 2 <2 3 2 <2 <2 <2 Y 15 17 16 13 18 20 21 18 8 21 Zn 63 72 66 69 69 70 75 73 61 74 Zr 70 79 77 75 75 87 95 75 54 97



14 DATA VERIFICATION

The mapping, drilling logs, point load test results and magnetic susceptibility results were

checked by Alex Boronowski, who was on the project during most of the described exploration

programs. The work was done professionally and the results are believed to be accurate and

concise.

Coffey conducted independent site visits, inspected the core and reviewed the drill logs,

analytical and point load testing results for accuracy and completeness. Coffey considers the

mapping, logging and data collection performed by Delta staff to be of a high standard.



15 ADJACENT PROPERTIES

As stated in section 6, Tasmanian Hardrock Pty Ltd is presently maintaining their tenure

located between the northern and southern parts of EL 6/2009, by a year-to-year Retention

Licence. No work has been conducted on the Retention Licence.

Tasmanian Ports Corporation Pty Ltd acquired a 100 m x 100 m, Mining Tenement 1117P/M

to cover the West Knob dolerite. West Knob is located approximately 500 m east of Lauriston

Reservoir and contiguous with Delta’s EL 6/2009. The quarry was a source of armour rock for

the Bell Bay port development. Remediation of the quarry is expected to commence in the

near future.



16 MINERAL PROCESSING AND METALLURGICAL TESTING

There was no mineral processing and metallurgical testing conducted



17 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES

The mineral resource estimate for the Bell Bay Quarry Project is based upon three

components:

� Demonstration of physical and chemical property homogeneity, ie., Mineral Resource

quality

� Volume/tonnage estimate of material, ie., Mineral Resource quantity

� Marketability of the Mineral Resource

Consideration of these components are necessary in order to classify an aggregate Mineral

Resource and are consistent with the guidelines for the reporting of industrial minerals in the

CIM definitions referred to in National Instrument 43-101. Mineral Reserves have not been

declared. Until all economic, design and other modifying factors are applied to define

reserves, the mineral resources do not have a demonstration of economic viability. Studies

have been sufficient to demonstrate that mineral resources have reasonable expectations for

future economic extraction; therefore these materials meet the CIM definition of resources.

17.1 Mineral Resource Quality

Physical properties are examined in detail in sections 11 and 12 whereas chemical properties

are discussed in section 13. Mapping and the Phase 1 diamond drilling program has shown

that the resources are bounded by fault zones. Material within the fault zones is considered to

be waste. The dolerite rock within the resource demonstrates rock qualities meeting or

exceeding the Australian Standards Specification Limit requirements for use as construction

material in the concrete and road industries.

The orthogonal jointing system appears to be uniform within the resources from surface to the

sedimentary-dolerite contact. The rock has very high strength. The steeply dipping

orthogonal joint sets may produce elongated aggregate. The elongated characteristic will be

investigated during the design of the commercial crusher.

Results of key quality measurements used in assessing the aggregate resource gave

favourable results. These include Coarse Fraction Particle Density and Water Absorption,

Sodium Sulphate Soundness Loss, and Los Angeles Abrasion Loss. The drill core is less

affected by weathering than surface samples and therefore is a better estimate of the quality

characteristics of the Bell Bay Quarry Project dolerite. The length weighted drill core results

from the Dolerite and Weathered Dolerite of the West, Central and East Resources are shown

in Table 13.8.1_1, Table 13.8.2_1, Table 13.8.3_1 and Table 13.8.4_1. Table 17.1_1

summarises the results for the four tests that were determined most significant for a resource

modelling exercise. However, all of these length weighted averages exceed the Australian

Standards Specification Limit requirements and therefore it is assumed that none of these

critical parameters need to be modelled for the global resource estimation since it is expected

that multiple mining faces will produce a global average blended feed for the processing plant.



Table 17.1_1


Summary of Key Quality Measurements

Test Length Weighted Average Standard Deviation Fresh Dolerite – West, Central and Eastern Resource s

Coarse Fraction Apparent Particle Density (T/m³) 2.93 0.06 Coarse Fraction Water Absorption (%) 0.88 0.54 Sodium Sulphate Soundness Loss (%) 2.67 3.02 Los Angeles Abrasion Loss (%) 13.21 1.43

Fresh and Weathered Dolerite - West, Central and Ea stern Resources Coarse Fraction Apparent Particle Density (T/m³) 2.93 0.08 Coarse Fraction Water Absorption (%) 1.13 1.18 Sodium Sulphate Soundness Loss (%) 4.12 7.59 Los Angeles Abrasion Loss (%) 13.89 5.09

Fresh and Weathered Dolerite – West Resource Coarse Fraction Apparent Particle Density (T/m³) 2.94 0.05 Coarse Fraction Water Absorption (%) 1.04 0.06 Sodium Sulphate Soundness Loss (%) 3.44 4.75 Los Angeles Abrasion Loss (%) 13.60 1.44

Fresh and Weathered Dolerite – Central Resource Coarse Fraction Apparent Particle Density (T/m³) 2.91 0.1 Coarse Fraction Water Absorption (%) 1.29 1.61 Sodium Sulphate Soundness Loss (%) 5.54 9.94 Los Angeles Abrasion Loss (%) 14.77 7.24



17.2 Mineral Resource Quantity

The volume and tonnage of the Bell Bay dolerite in the proposed quarry area were estimated

from a 3-dimensional block model utilizing commercial mine planning software (Surpac).

17.2.1 Geological Modelling

Geological constraints for the mineral resource estimation were modelled by Coffey based

upon the lithological interpretations and the supplied drillhole database from Delta. Three

dimensional wireframe models representing the dolerite-sediment contact as well as fault

zones were constructed from digitised strings that were interpreted from drillhole sections

(Figure 17.2.1_1). A three dimensional wireframe model representing the base of pervasive

weathering was constructed from an interpolation of depth below surface values derived from

drill hole logs (Figure 17.2.1_2).

Figure 17.2.1_1


Geological model Wirerframes

Review and editing of the lithological and weathering domains were carried out using the

interactive modelling facilities in the Surpac software package. All modelling work was carried

out in UTM (MGA94, Zone 55) coordinates.



Figure 17.2.1_2


Base of Weathering Model Wirerframe

17.2.2 Surface Topography

A three dimensional wireframe model of the surface topography at the Bell Bay Project was

supplied by Delta (Figure 17.2.2_1). The wireframe is based on a 40m by 40m grid; with

closer spaced data points along significant breaks of slope e.g. ridge lines and gullies. The

wireframe model is in close agreement with the drill hole collar elevations.

Figure 17.2.2_1


Topographic Surface Model Wirerframe and Drillhole Collars – Oblique View Looking North



17.2.3 Resource Boundary

The surface project limits are the faults bounding the West, Central and East Resources as

well as drainage and visual considerations (Figure 17.2.3_1).

Figure 17.2.3_1


Resource Boundary (Red) and Bounding Faults (Blue)



17.2.4 Block Model Construction Parameters

Parent block dimensions were selected based mine planning considerations, and sub-block

dimensions were chosen to enable accurate reproduction of the volumes of the dolerite

domain. The coordinate extents of the block model and the dimensions are summarised in

Table 17.2.4_1.

Table 17.2.4_1


Block Model Dimensions

Block Size (m) Model Origin Coordinates

Extent (m)

Number of blocks Parent Sub-block

East 491500 1,800 72 25 6.25

North 5446500 1,350 54 25 6.25

Elevation -50 310 31 10* 2.5

17.2.5 Block Model Attributes

A series of attributes were incorporated into the block model for recording attributes assigned

throughout development of the block model. A list of the attributes is displayed in

Table 17.2.5_1. The domain coding was assigned on the basis of the various wireframe

constraints as displayed in Table 17.2.5_2.

Table 17.2.5_1


Block Model Attributes

Attribute Description

rock 1=dolerite, 2=sediments

resource 1=inside resource boundary

weathering 1=fresh, 2=weathered

fault_zone 1=fault zone

rescat Resource Category (Numeric) – 1=Measured, 2=Indicated, 3 = Inferred



Table 17.2.4_2


Block Model Domain Coding

Attrtibute Code Wireframes Description

1 sed_dol_conatct1, topo Above dolerite-sediment contact and below topographic surface rock

2 sed_dol_conatct1, Below dolerite-sediment contact

resource 1 resource_boundary1 Inside resource boundary

1 base_ox Below base of oxidation weathering

2 base_ox Above base of oxidation

fault_zone 1 fault_zones1 Inside fault zone solid wireframe

17.2.6 Block model Validation

The integrity of the resource block models were validated by means of detailed visual

comparison of the various wireframes against the colour coded block models. The block

model volume and volumes between wireframe surfaces were compared for the dolerite

horizon. The block models reproduced the wireframe volumes well and are considered a

robust representation of the interpreted dolerite resource.

17.2.7 Bulk Density Assignment

The average length weighted Coarse Fraction Apparent Particle density value for the twenty-

five composites contained in the “Dolerite and Weathered Dolerite results from the West,

Central and East Resources” is 2.93t/m³. Results are contained in Table 13.8.2_1.

17.3 Mineral Resources Marketability

Delta has demonstrated through its studies to date that the Bell Bay dolerite has a reasonable

potential of being a commercial source of crushed rock for aggregate. Materials testing of drill

core from the West, Central and East Resource areas show that the dolerite has acceptable

abrasion resistance, sulphate soundness loss and water absorption values. Independent

studies of the Sydney aggregate market demonstrate that the area is permanently aggregate

deficient and that marine imports or hauling long distances by truck or train will be required to

meet projected demands.



17.4 Mineral Resource Classification

17.4.1 Introduction

The resource categorisation of the Bell Bay Quarry Project was undertaken on the basis of

assessment criteria set out in the Canadian National Instrument 43-101, Standards of

Disclosure for Mineral Projects of February 2001 (“the Instrument”) and the classifications

adopted by CIM Council in August 2000. Measured, Indicated and Inferred Mineral

Resources have been defined using criteria selected during validation of the key rock quality

criteria, with detailed consideration of the Instrument categorisation guidelines.

The resource categorisation has been based on the robustness of the various data sources

available, including:

� Geological knowledge and interpretation.

� Surface outcrop observations.

� Drillhole logging and measurements.

17.4.2 Criteria for Resource Categorisation

The classification protocol consisted of two parts: defining limits at surface followed by a set of

rules for sub-surface projection. The dolerite within the topographic highs demonstrated good

continuity on surface, and measured rock quality characteristics allowed a high level of

confidence.

Measured Mineral Resources have been declared up to 150m laterally from a drill hole trace,

if supported in that particular area by dolerite with Good (60%) to Very Good (100%) RQD

values on surface, and not within the modelled weathered horizon.

Indicated Mineral Resources are those areas flanking the Measured Mineral Resource, and

within 150m of good RQD values on surface.

Inferred Resource is the remaining area within the bounds of the resource where dolerite

outcrop has been mapped and the RQD values are Good (>60%). Inferred Resources have

also been assigned to any dolerite within 50m of an interpreted fault.

Subsurface projection was set to the depth of the hole or to the dolerite-sedimentary contact.

The following numeric resource category codes were assigned into the block model, based on

the categorisation criteria listed above:

� Measured Resource: rescat = 1

� Indicated Resource: rescat = 2

� Inferred Resource: rescat = 3



17.4.3 Categorised Resources

The aggregate Resource Statement as of September 10th, 2010 is displayed below in

Table 17.4.3_1 and has been prepared and reported in accordance with the Canadian

National Instrument 43-101, Standards of Disclosure for Mineral Projects of December 2005

(“the Instrument”) and the classifications adopted by CIM Council in August 2000. The Coffey

resource estimate for the Bell Bay Quarry Project has been classified as an Measured,

Indicated and Inferred Mineral Resources based on the confidence level of the key criteria

that was considered during resource classification as presented in Section 17.4.2, and on the

bounding limits defined in Section 17.2.3.

The classifications are also shown in plan view in Figure 17.4.3_1 and in section view in

Figure 17.4.3_2.

Table 17.4.3_1


Mineral Resources as at 10 th September 2010 subdivided by Category

Category Volume (Mm 3) Tonnes (Mt) Measured Mineral Resource 78.2 229 Indicated Mineral Resource 34.6 101 Measured and Indicated mineral resource 112.9 331 Inferred Mineral Resource 3.6 10 Note: Average Length Weighted Coarse Fraction Apparent Particle Density = 2.93 t/m³; Mineral Resource calculated to dolerite-sedimentary contact and bounding faults



Figure 17.4.3_1


Block Model Plan View showing Resource Categories (Measured=yellow, Indicated=orange, Inferred=green )

Figure 17.2.3_1


Block Model Section View (5447210mN)showing Resourc e Categories (Measured=yellow, Indicated=orange, Inferred=green )



18 OTHER RELEVANT DATA AND INFORMATION

� The mine design and plan is being conducted internally in Delta by John Purkis. This

task will be awarded to an independent engineering firm upon completion of the Phase 2

drilling program.

� An independent 43-101 compliant report stating a Proven and Probable Reserve

acceptable to use in a Prefeasibility Study will be awarded to an independent engineering

firm upon start up of the Phase 2 drilling program.

� Coffey has conducted Hydrogeology and Hydrology Studies in preparation for an

Environmental Impact Assessment Report.

� North Barker Ecosystem Services has produced the Flora and Fauna Habitat

Assessment and Constraints Analysis for Coffey and is continuing data collection for the

Environmental Impact Assessment Report.

� Philip Milner consulting botanist has conducted flora surveys along proposed drill

roads/tracks and drill sites.

� Stuart Huys (CHMA archaeologist) and Vernon Graham (Aboriginal Heritage Officer) of

Cultural Heritage Management Australia is conducting the archaeological fieldwork for

Exploration Work Program and permitting purposes.

� The contract for Vibration Monitoring and Modelling is being tendered and monitoring is

expected to commence in 2010.



19 INTERPRETATION AND CONCLUSIONS

The following interpretations and conclusions may be drawn from review of the Exploration

Studies:

� The Bell Bay Quarry dolerite is a coarse to fine grained, ophitic textured sill with an

apparent dip of approximately 10° to 15° to the southwest. The dolerite sill is cut by

steeply dipping NW-SE, E-W and NE-SW trending faults which bound the drill tested

West, Central and East Resources. In three-dimensional modelling the dolerite-

sedimentary contact appears to have an elongated bowl like form striking approximately

300-120 degrees. The true thickness of the pre-eroded sill is unknown, but known to

exceed 170 m as defined by drill hole BB10-13.

� Surface mapping and orientated core measurements indicate that there are five joint

trends in the project area. Three of the joint trends parallel NW-SE, E-W and NE-SW

striking faults. The N-S trending joints, appear to be the dominant trend. The low angled

E-W striking and south dipping joints are widely spaced and potentially could have an

impact on mine planning.

� The optimal blast hole pattern and explosive type will need to be determined in order to

produce the best combination of feed to the primary crusher, reduce costs associated

with secondary breakage and limit production fines. The relatively close spacing of the

steeply dipping orthogonal joint sets may cause elongation of the fine and coarse

fragments. Designing the commercial crusher specifically for the Bell Bay dolerite should

maximize the production of cubic fragments.

� The Central and East Faults have been drill tested. These two faults strike NW-SE and

dip steeply to the east and west and the Central Fault has an apparent dextral strike slip

displacement of approximately 450 metres.

� The Central and East Fault zones consist of weathered, sheared and brecciated dolerite

containing predominantly clays, limonite, zeolites, chlorite and carbonate. The quality of

the material within the fault zones does not normally meet the Australian Standards

Specification Limit requirements for the Coarse Fraction Particle Density and Water

Absorption, Sodium Sulphate Soundness Loss and Los Angeles Abrasion Loss tests and

therefore the fault zones have been classified as waste.

� The representative composite samples were classified into the following four categories:

o Dolerite – this material occurs within the resource and is good quality dolerite without

any significant weathering or deleterious minerals.

o Weathered Dolerite - this material occurs within the resource and represents the

weathered dolerite in the near surface portions of the drill holes and the more strongly

jointed dolerite adjacent to the fault zones.



o Fault Zone – this material is considered waste because it contains deleterious minerals.

However, there are weathered dolerite boulders and sections of good dolerite within the

fault zone which may be separated by dry sieving and then utilized for crushed material

or specialty stone.

o Sediment - this material represents the Triassic age sediments underlying the dolerite

and is considered to be waste.

The Rock Quality Designation, Core Recovery and Point Load testing indicated that the

Dolerite and Weathered Dolerite Results for the West, Central and East Resources were as

follows:


� RQD averaged 63%, which yielded a rating of 13. Together with the other criteria (Intact

Rock Strength, Joint Spacing, Joint Condition and Groundwater) in the Rock Mass Rating

Classification System produced a rating of between 60 and 80 which is described as

Good on a five division scale ranging from Very Poor to Very Good.

� Point Load testing results indicate that 97% of the core tested has a strength

classification of R4 High to R6 Extremely High.

� The following analytical tests were determined to be critical parameters for evaluating the

suitability of the composite drill core samples for construction material:

� Coarse Fraction Particle Density (>2.5 T/m³) and Water Absorption (<2%)

� Sodium Sulphate Soundness Loss (≤6% for concrete exposure classification C and

≤9% for concrete classification B1 and B2)

� Los Angeles Abrasion Loss (<30%).

� Six composites within the West and Central Resources are classified as Weathered

Dolerite. Weathered Dolerite occurs close to the surface or in areas containing a higher

frequency of closely spaced joints.

� Three of the six composites are contained within the upper portions of the drill holes

and yield results that did not meet Australian Standards Specification Limit

requirements for at least one of the critical parameters.

� One of the six composites was collected from a zone of closely spaced joints

adjacent to the Central Fault. The composite contains weathering and alteration

minerals and yielded results that did not meet Australian Standards Specification

Limit requirements for at least one of the critical parameters.

� Two of the six composites exceeded the Australian Standards Specification Limit

requirements for the critical parameters

� Dolerite, with the exception of one composite, yielded test results that exceeded the

Australian Standards Specification Limit requirements for use in the concrete and road



construction industries. The composite exception, from BB10-20, was sampled from a

zone of closely spaced joints adjacent to the Central Fault and contains weathering and

alteration minerals, which yielded results that did not meet the Australian Standards

Specification Limits.

� Testing of the Dolerite and Weathered Dolerite from the West, Central and East

Resources indicated that the arithmetic and length weighted averages for all tests, with

the exception of the Fine Fraction Water Absorption, exceed the Australian Standards

Limit requirements for construction material. It is believed that the Fine Fraction Water

Absorption values will be improved during crushing and processing as a result of

designing the equipment specifically for the material being mined. Therefore, it is

believed that the Dolerite and Weathered Dolerite can be blended during mining to

produce a product that would meet the requirements for construction material in the

Sydney market.



20 RECOMMENDATIONS

The Phase 1 drilling program was modified during the program which resulted in more vertical

holes being drilled than originally designed. The consequence of this change was that the

vertical holes parallel the steeply dipping joint sets which contain weathering and alteration

products. The test results may not represent the area of influence around the drill hole

because the frequency and intensity of the joint sets away from the vertical hole is unknown.

Therefore, angled holes should yield a better understanding of the distribution and

characteristics of the jointing. A geophysical resistivity survey may be useful in defining

conductive clay within zones of weathered dolerite.

A budget estimated at $1.75M is proposed for a Phase 2 drilling program consisting of 40

angled holes and one vertical hole totalling 5,359 metres of HQ3 and NQ2. Included in the

total, are three, vertical water bore holes totalling 350 metres for hydrogeology studies and the

extension of two drill holes 20 metres into the sediments for geotechnical studies.

It is recommended that a geophysical resistivity orientation survey be conducted across

BB10-12 and the Central Fault Zone. The purpose is to determine if the weathered dolerite

and the fault zone material has an anomalous conductive response due to clay content. If

successful, then it is recommended that the resources be surveyed by geophysical resistivity.

Defining the zones of deleterious material will improve drill hole planning and reduce drilling

costs.

It is recommended that two track mounted diamond drills be utilized on a 24 hour per day and

7 day week schedule in order to produce a cost efficient and effective three month drill

program.

The purpose of the exploration program is as follows:

� to determine the area of influence of weathered dolerite within the resources.

� to determine the area of influence of intensely jointed dolerite adjacent to the faults zones

within the resources.

• to increase the statistical database of composites to allow interpolation of quality

parameters and/or definition of sub-types of unsuitable materials with confidence in

volume zones representative of annual periods in a typical mining sequence.

� to acquire hydrogeological and geotechnical data for baseline studies and mine planning.



21 REFERENCES

Bacon, C. A., 1999. Mineral Exploration Code of Practice Edition 4-March 1999, Mineral

Resources Tasmania publication.

Banks, M. R., Green, D. H., Hergt, J. M., McDougall, I., 1989. Jurassic dolerite in Geology

and Mineral Resources of Tasmania, Geol. Soc. Aus. Spec. Publ. 15, 375-378.

Forsyth, S. M., 1984. Oatlands, Tasmania. Tasm. Dep. Mines.Geol. Atlas 1:50,000 Series

Expl. Notes, Sheet 68 (8313S).

Forsyth, S. M., 1989. The Tamar Graben in Geology and Mineral Resources of Tasmania,

Geol. Soc. Aus. Spec. Publ. 15, 358-361.

Hergt, J. M. and Brauns, C. M., 2001. On the origin of Tasmanian dolerites. Aust. J. Earth

Sci., 48, 543-549.

Hergt, J. M. and McDougall, I., 1989. Petrography (Jurassic dolerite) in Geology and Mineral

Resources of Tasmania, Geol. Soc. Aus. Spec. Publ. 15, 378-381.

International Society for Rock Mechanics Commission on Testing Methods, Suggested

Method for determining Point Load Strength, Int. J. Rock Mech. Min. Sci & Geomech.

Abstr., Vol. 22, No. 2, pp.51-60, 1985.

Knight Piesold Consulting, 2004. Field Procedures Manual – Geotechnical Data Collection for

Exploration Geologists, www.knightpiesold.com.

Leaman, D. E., 1975. Form, mechanism and control of dolerite intrusion near Hobart,

Tasmania. J. Geol. Soc. Aust. 22: 175-186.

Leaman, D. E. and Richardson, R. G., 1981. Gravity survey of the east coast coalfields. Bull.

Geol. Surv. Tasm. 60.

Leaman, D., 2002. The Rock which makes Tasmania. Leaman Geophysics publication,

Hobart, Tasmania, Australia.

McDougall, I., 1958. A note 0n the Petrography of the Great Lake Sheet in Dolerite

Symposium, Univ. Tasm., 52-60.

Morrison, K. C., Baillie, P. W., Davidson, J. K. and Quilty, P. G., 1989. Tectonic and

Depositional Framework (Jurassic-Cainozoic) in Geology and Mineral Resources of

Tasmania, Geol. Soc. Aus. Spec. Publ. 15, 341-347.

Nordin, G., and Boronowski, A., 2002. Geological Report Alberni Aggregates Project, Alberni

Inlet, British Columbia. Prepared for Polaris Minerals Corporation and Eagle Rock

Materials Ltd.

Seymour, D. B. and Calver, C. R., 1998. Time-Space Diagram for Tasmania, NGMA TASGO

Project, Version 2 (31-3-1998).



Sloan, D.J., Some physical properties of dolerite, Tasmanian Department of Resources and

Energy, Division of Mines and Mineral Resources, Report – 1991/22

Smith, Larry, 2005. Eagle Rock Quarry Project, British Columbia, 43-101 Technical Report

and Qualified Persons Review. AMEC – Eagle Rock Materials Ltd.

Sutherland, F. L., 1977. Zeolite minerals in the Jurassic dolerites of Tasmania: their use as

possible indicators of burial depth. J. Geol. Soc. Aust. 24(3): 171-178.

Williams, E., 1976. Explanatory notes for the 1:500,000 structural map of pre-Carboniferous

Rocks of Tasmania: Tasman Fold Belt System in Tasmania. Tasm. Dep. Mines.



22 CERTIFICATES

Certificate of Qualified Person As a reviewer and author of the report entitled “Bell Bay Quarry Project, Tasmania” dated September 10th 2010, on the Bell Bay Quarry Project from Delta Materials (the “Study”), I hereby state:-

1. My name is Troy Edward Lowien, Associate Resource Geologist, with the firm of Coffey Mining Proprietary Limited of Level1, 15 Astor Terrace Spring Hill 4000, Australia.

2. I am a practising geologist and registered Member of the Australasian Institute of Mining and Metallurgy (No 112701).

3. I am a graduate of the Queensland University of Technology, Queensland, Australia with a BAppSc (Hons) Degree in Geology (1997). I have practiced my profession continuously since 1998.

4. I am a “Qualified Person” as that term is defined in National Instrument 43-101 (Standards of Disclosure for Mineral Projects) (the “Instrument”).

5. I have visited the Bell Bay Quarry Project. I have viewed core and reviewed files and data supplied by Delta Materials during October 2009 to September of 2010.

6. I am responsible for Section 17 of the study, and jointly responsible for the remaining sections.

7. As of the date of this certificate, to the best of my knowledge, information and belief this technical report contains all scientific and technical information that is required to be disclosed to make the technical report not misleading.

8. I am independent of Delta Materials pursuant to Section 1.4 of the Instrument.

9. I have read the National Instrument and Form 43-101F1 (the “Form”) and the Study has been prepared in compliance with the Instrument and the Form.

10. I do not have nor do I expect to receive a direct or indirect interest in the Bell Bay Project or Delta Materials, and I do not beneficially own, directly or indirectly, any securities of Delta Materials or any associate or affiliate of such company.

Dated at Brisbane, Queensland, on 10th September, 2010.

Troy Lowien Associate Resource Geologist

BAppSc (Hons) (Geology) MAusIMM



23 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT PROPERTIES AND PRODUCTION PROPERTIES

All relevant information has been presented in the preceding chapters.

Appendix 1 Geology 1:25,000

Appendix 2 Geological Mapping

Appendix 3 Cross Sections

Appendix 4 Drill Hole Logs

Appendix 5 Drill Core Photos

Appendix 6 Surface Mapping Tables

Appendix 7 Geotechnical Review – Coffey Mining

Appendix 8 Geophysical Survey Report – Atlas

Geophysics

Appendix 9 Drill Core Analytical Results – Review by

CQT

Appendix 10 Petrographic Studies

Appendix 11 Drill Core Logging Procedures

Appendix 12 Field Procedure Manual – Geotechnical Data

Collection for Exploration Geologists

hoba268aa delta bell bay report 43-101 final v2...compliant resource report. the bell bay quarry...

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