Alliance Resources Ltd.

Alliance has a 75% joint venture partner in the Arkaroola Project, Quasar Resources Pty Ltd.Alliance's core business is as a uranium, copper and gold explorer. Alliance operates the Maldon Gold Project in Victoria and has a 25% free carried interest (Quasar Resources Pty Ltd – 75%) in the Arkaroola Project in South Australia, where its joint venture partner Quasar is exploring for uranium, copper and gold. In 2005 Quasar discovered the Beverley 4 Mile uranium prospect on the JV tenements.

Arkaroola Copper-Gold-Uranium Project, South Australia (Alliance 25% Free Carried)

Alliance’s joint venture partner in the Arkaroola Project is Quasar Resources Pty Ltd (“Quasar”), an affiliate of Heathgate Resources Pty Ltd (“Heathgate”). Heathgate is the owner and operator of the Beverley Uranium Mine, immediately to the east of the Arkaroola tenement. Prospect locations, Arkaroola

Prospect locations, Arkaroola
(larger image available by clicking thumbnail image top right)


During April 2005, farm-in partner Quasar reported that reconnaissance drilling at the Beverley 4 Mile Prospect intercepted uranium equivalent mineralization.

The drilling targeted sands with potential to host uranium mineralisation within the ‘Paralana High Plains’, east of the Northern Flinders Ranges in an area 5 to10km west of the Beverley Uranium Mine (Figure 5A). It has been suggested that the uranium at the Beverley Uranium Mine was sourced from weathering of the Mt Painter highlands to the west. A total of 65 rotary mud drill holes totalling 4,857m have been completed, additionally two drill holes (AK002 and AK010) had 3m diamond core tails taken of basement volcanics.

All holes were logged using down hole geophysical probes including a gamma ray log which is used to calculate equivalent U3O8 grades and recently a Prompt Fission Neutron (PFN) tool has been used to verify the presence of uranium mineralisation in selected holes. All holes were drilled vertically to intersect carbonaceous units within the Tertiary sedimentary sequence unconformably overlying weathered Proterozoic basement.

Drilling to date has identified two distinct mineralised zones.

The highly encouraging uranium equivalent results included:

Western Zone
13.5 m @ 0.440 %e eU3O8(1) (including 5.0 m @ 0.801 % eU3O8(1))
3.5 m @ 0.562 % eU3O8(1)
4.5 m @ 0.405 % eU3O8(1)
6.0 m @ 0.230 % eU3O8(1)
8.0 m @ 0.137 % eU3O8(1)

Eastern Zone
5.5m @ 0.40 % eU3O8(1)
1.5m @ 0.26 % eU3O8(1)
1.0m @ 0.20 % eU3O8(1)
1.0m @ 0.16 % eU3O8(1)
5.0m @ 0.15 % eU3O8(1)

(1) - eU3O8 refers to equivalent grade U3O8 as estimated from a gamma-ray log

Follow-up geochemical analyses of two metre samples drilled in the mineralised holes were received in the second half of 2005. The results indicated anomalous uranium values (up to 2,550ppm in AK019) were generally coincident with the zones previously reported as containing anomalous radioactivity as measured by down hole gamma-ray logging. Thorium values throughout the mineralised zones reported at background or near background values (<30ppm Th). These analyses confirm the radioactivity as being due to uranium.

Coarse sands are widespread and thickly developed above a regional unconformity developed at the top of presumed Proterozoic basement rocks. These sands frequently show limonite staining suggestive of an oxidising event that may be related to roll front movement down-dip to the northeast. The geology of the Paralana High Plains differs from that encountered to the east at the Beverley Uranium Mine. Mineralisation at the Beverley 4 Mile Prospect is considered to occur at, or over a disconformity between, the early Cretaceous Bulldog Shale and the overlying Eocene Eyre Formation. Importantly, the Eyre Formation is the host to known uranium deposits such as Honeymoon and Gould’s Dam.

Drilling results in the western extension area continued to provide highly encouraging results with the majority of holes intersecting uranium mineralisation The known areal extent of the mineralisation is currently 1.6km by 1.2km, but the mineralised zone has not been closed off by drilling. The depth to basement is relatively uniform with depths commonly between 160m and 190m indicating that there are no major structural controls within this mineralised zone.

Quasar is planning an extensive drill campaign for 2006. Additional work to define groundwater quality, mineralogy and metallurgical characteristics will also be undertaken. Map showing recent drilling in Beverley 4-Mile outlined areas of mineralisation

Map showing recent drilling in Beverley 4-Mile outlined areas of mineralisation
(larger image available by clicking thumbnail image top right)


At the M2 target area adjoining the old Yudnamutana Mining Field in the south west of the tenement, 19 rock chip samples were collected over 5 of the initial geophysical targets. Assay results of rock chip samples returned anomalous gold and copper geochemistry (250 to 350 ppb gold and 1 to 20% copper) from three samples and one sample returned 10 ppm gold and 4% copper. Four sites were selected for the initial drill programme to test for IOCG (iron oxide-copper-gold) style copper gold mineralisation. Quasar has received a PACE grant (Plan for Accelerating Exploration) from the South Australian Government. This will fund a portion of the drilling costs on one of the base metal targets.

Quasar has reported that RC pre-collars were drilled, and diamond drilling has commenced at M2 target in January 2006.
Maldon Gold Project, Victoria (Alliance 100%)


The Maldon Goldfield is the next most productive reef goldfield in Victoria after Bendigo, Stawell and Ballarat. From 1854 to 1926, records indicate total primary production of 1.75 million ounces of gold at an average recovered grade of 28 g/t.

Alliance listed on the ASX as Alliance Gold Mines NL in 1994 after it purchased the Maldon Gold Project from Triad Minerals, including a fully permitted and an operational gold treatment plant, 3km northeast of Maldon. From 1988, the previous owner produced over 55,000 ounces of gold from the Union Hill open pit. Between 1994 and 1998 considerable drilling was undertaken, mainly along the Eaglehawk Reef and mining continued in the open pit. A decline was commenced from within the open pit to explore Eaglehawk and Linscotts reefs, and then head south to access other reefs adjacent to the town of Maldon. The decline was suspended in 1997 in a climate of falling gold prices. Scalping and limited surface mining operations were conducted in the open pit in 1998/99.

In October 2003, Alliance attracted a new major investor and Alliance underwent changes to its Board, changed its name to Alliance Resources Ltd and $2.45 million was raised in funding via a non-renounceable entitlement issue to re-invigorate the Maldon Gold Project.

Geological Review

A geological review of the Maldon Goldfield commenced in December 2003 and was completed during June 2004. The review focussed on a 3km by 1km corridor hosting the majority of Maldon's historic gold production. The resulting database was used to produce digital model of historical mines, major quartz reefs and associated ore shoots. This work relied heavily on geological mapping by 19th century government geologist R.A. Moon and mine managers’ reports in the local newspaper. Further research on the position of quartz reefs and ore shoots from mine managers’ reports in the local newspaper was then added to the database. The review and subsequent digital modelling showed the five major reefs to have good structural continuity. It identified 10 target areas, including possible extensions to the known reefs and possible new ore shoots.

The review has highlighted structural continuity within five major reef lines and Alliance has identified 10 target areas to date, including possible extensions to existing reefs as well as possible new ore shoots.

Targets are high-grade gold lodes of plus 30,000 ounces, which are relatively short in strike length but persistent down plunge.
Maldon Goldfield showing major reef lines
(larger image available by clicking thumbnail image top right)


Since 2004, Alliance has undertaken diamond drilling of targets generated by the geological review of the Maldon Goldfield. Exploration to date has identified potentially mineable mineralisation in Eaglehawk Reef at Alliance South Prospect.
The first drill holes at Alliance South Prospect (Figure 2) confirmed the structure as predicted by the geological model and produced several encouraging intercepts. Step-out and in-fill drilling that has now tested the reef with 32 holes for a total 8,487 m.

Long section of Eaglehawk Reef, Maldon
(larger image available by clicking thumbnail image top right)

Several mineralised zones associated with Eaglehawk Reef have been identified at Alliance South, however the dominant mineralised structure occurs along the western margin of the main lode, close to the west bounding fault or “wall”. The gold mineralisation is associated with two moderately south-plunging flexures in the reef. The upper flexure mineralisation displays continuity over plus 350m down plunge and both flexures remain open along plunge.

Alliance South prospect gram-metre contours, looking west
(larger image available by clicking thumbnail image top right)

A typical cross section showing several drill holes at Alliance South Prospect is presented here.

Alliance South cross-section 5901300mN
(larger image available by clicking thumbnail image top right)

Proposed Exploration and Mining

Alliance is now investigating an exploration decline to permit extraction of a bulk sample for grade determination through Alliance's treatment plant. If the results are positive, the Company will be well placed for underground development. Underground development will also provide access to some targets currently unable to be drilled from surface at a reasonable cost.

In the longer term, Alliance plans to test the numerous remaining targets generated by the geological review.


The treatment plant is currently on care-and-maintenance. Monitoring of the rehabilitation areas at Maldon is ongoing.
Warrina Copper-Gold Project, South Australia (Alliance 100%)

Alliance has an exploration licence application in the Warrina area of the northern Gawler Craton, South Australia (Figure 6). The project is prospective for breccia-hosted iron oxide copper-gold-uranium mineralisation.

The most encouraging prospect is the Big North East Prospect (Big NE), comprising a near coincident magnetic/gravity anomaly complex in the Proterozoic basement covered by approximately 300m of younger sediments. This discrete magnetic high at Big NE trends northeast over 10km while a significant gravity anomaly occurs, offset to the strongest part of the magnetic high. This association has similarities to the geophysical signature of the Prominent Hill copper-gold deposit.

In 2003, two holes targeting the gravity anomaly intersected variably altered haematite-carbonate-amphibole-sulphide metasediments, supporting the concept that the positive gravity anomaly is a response to iron oxide alteration and provides encouragement for testing the magnetic anomaly. The presence of more haematite and elevated metal values in the second hole (ABNE02) indicates potential for a nearby source with greater concentrations of sulphide mineralisation, perhaps associated with the more magnetic parts of the geological sequence. Further drilling is planned for 2006.
Map showing recent drilling in Beverley 4-Mile outlined areas of mineralisation