DRAGON ENERGY LTD - ASX: DLE

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Description

Dragon Energy Limited (“Dragon”) was incorporated in June 2006 and in February 2009 was admitted to the Official List of ASX. The Company’s listing on the ASX was facilitated by cornerstone investor the China-based Shandong Taishan Sunlight Group Company Limited (“Shandong Group”), which controls 1.5 billion tonnes of coal and 100 million tonnes of iron ore resources in China as well as engaging (in a lesser capacity) in steel making and power generation. It has also facilitated many large commercial mining transactions in the Chinese resources sector. Shandong Group is a private enterprise and provides Dragon with direct and indirect financial capacity, wide industry connections, and mining know how, to underpin Dragon’s growth and pursuit of mineral projects.

Dragon's flagship projects are the Rocklea and Nameless Iron projects in the Pilbara region with a sizeable JORC resource defined at Rocklea and significant CID exploration targets at Nameless. Dragon Energy's portfolio of tenements has numerous multi-commodity targets, including Fe, Mn, Au and U in Western Australia and coal interests in Queensland.

Rocklea Project, Western Australia

Rocklea(E47/1024-I) - Located 33km southwest of the mining town of Tom Price, and immediately north of Murchison Metals’ RockleaCID project in the Pilbara Region. The Rocklea Project is located on the eastern side of the Rocklea dome where Archaean age Fortescue Group Formations dip to the east and are overlain by Tertiary age CID and other Cainozoic deposits of sand and gravels. The Rocklea CID comprises goethitic and hematitic detrital deposits of the Tertiary Robe Pisolites.

In the 1970s Hamersley Exploration Pty Ltd outlined a small resource, which has been enhanced and expanded upon by AusQuest. Drilling from 2005-2009, outlined an Inferred Resource, which was reported on 17 August 2009 by AusQuest as; 63.1Mt @ 53.4% Fe (60.4% caFe), including a higher grade component of 28.2Mt @ 55.6% Fe (62.7% ca Fe).

This resource is open to the south and east, and outcropping CID in the NE corner of the tenement has not been drill tested. An assessment of the project will be carried out with the aim of undertaking a step-out and exploratory drilling programme targeted to expand the resource, followed by a scoping study.

Nameless Project, Western Australia

Nameless(E47/1485-I & M47/1452) - Located 10km NW of Tom Price in the Pilbara Region. The project is situated along the south-dipping northern limb of the Mt Turner Syncline within the South Pilbara Basin of the Hamersley Basin. Bedrock lithologies comprise volcano-sedimentary rocks from the Fortescue and Hamersley Groups, with the Marra Mamba Iron Formation paralleling the southern boundary of the tenement. Cainozoic cover sequences include the Robe Pisolite Formation.

Mapping by AusQuest delineated 15km strike of a prospective 200-600m wide palaeochannel, of which 12.5km was drill tested by AusQuest on 400m to 1200m spaced drilling traverses. A total of 89 holes for 3,044m on 400-1200m spaced traverses were drilled in 2006 and 2008. CID mineralisation is up to 24m in thickness and infill drilling is required to define its continuity. Dragon will undertake an assessment of the project with the aim of planning infill and step-out drilling programmes in order to define a mineral resource.

Lee Steere Project, Western Australia

Lee Steere (E69/2126, E69/2377)-The Lee Steere project is located some 200km NE of Wiluna,and 70km east of Giralia’s Earaheedy advanced iron project. Previous exploration activities in the 1970s identified enriched hematite mineralisation of BIFs and Superior-type iron within the Frere Formation; rock chips of up to 66.1% Fe were reported. The project contains 48km strike of the prospective Frere Formation, as identified from magnetics and outcrop. Dragon’s exploration focus will be on supergene enriched hematite/goethite and manganese mineralisation.

Mt Gibson Project, Western Australia

Mt Gibson(E59/1637-38, 1686-87) -These tenements lie 80km NE of Wubin, 7-32km south and east of the Extension Hill Hematite/Magnetite Project, and partly hosts the Mt Gibson Gold Operation. The project is situated in the Midwest Region of the Yilgarn Craton. A 7km outcrop of magnetite (hematite)-amphibole-quartz BIF has previously been mapped on E59/1638 within the southern Ninghan Belt. A similar prominent magnetic feature to the NW of the tenement may also represent BIF units. There is no record of exploration for iron ore in the area.

E59/1686 incorporates a couple of open pits from the Mount Gibson Gold Operation (868,400oz mined), within the southern Retaliation Belt, which hosts the Mt Gibson iron deposits to the north.Regional magnetics indicates that similar geological and structural features extend within E59/1686 and E59/1637, together with higher intensity BIF/ultramafic magnetic characteristics. An investigation of gold will be undertaken in conjunction with iron.

Carters Well Project, Western Australia

Carters Well (E59/1639)- Located 31km south of Mt Magnet, adjacent to the Great Northern Highway, and 9km from rail. The tenement overlies the Coolaloo Dome, a granite batholith having a prominently magnetic margin which may reflect the presence of a hematite-magnetite-quartz shear (BIF) adjacent to the contact. BIF has been mapped within the western granitoids, and the Magnet-Wydgee Fold Belt greenstones on the eastern margin. The structure outcrops poorly but is well defined on aeromagnetic data beneath shallow soil cover.

Milly Milly Project, Western Australia

Milly Milly (E09/1811)- The Milly Milly project is located 196km west of Meekatharra, 58km east of Jack Hills. The project has potential to host Jack Hills style, high quality magnetite deposits. BMR regional magnetic surveys indicate favourable host rocks of 42km strike within the tenement. GSWA mapping indicates 26km strike of BIF (quartz-magnetite) outcrop, with exploration to date returning rock chip results of 30-40% Fe with peak value of 44% Fe. A chromite rich magnetite layer with an interpreted strike length of 1.6km provides an alternative exploration target.

Ashburton Project, Western Australia

Ashburton (E08/2209-2211, E47/2417)- Ashburton project is 10-40km from rail and other infrastructure associated with the Paraburdoo operations of Rio Tinto Iron Ore. Approximately 50% of the project area has a Cainozoic cover which potentially conceals channel iron deposits (CID) within the braided drainages of Turee and Seven Mile Creeks, which drain the ranges of the Brockman Iron Formation near Paraburdoo. CIDs represent a priority target, potentially producing ahigh grade direct shipping ore product.

PROJECTS - QUEENSLAND (Dragon Earning 85%)

A Joint Venture agreement with Altera Resources Ltd on 13 Exploration Permits for Coal commenced 1st July 2010. They total a significant 4,558km2 in area. Dragon will be earning an 85% interest upon meeting agreed expenditure goals.

The Moranbah Project is located in the productive Bowen Basin. The Boonah Project is within the Surat Basin, while the remaining Permits are located in the Clarence Moreton Basin on the NSW border. The primary exploration targets are coking and thermal grade coal.

Mine For

iron ore, manganese, gold, uranium, coal

Location of operation(s)

Queensland, Western Australia

Australian Basins

Bowen, Clarence Moreton, Surat

Address

Se 8, 1297 Hay St
WEST PERTH, WA, Australia

Phone

(61 8) 9322 6009

Email

Website

http://www.dragonenergyltd.com.au

Last Updated

5/5/2011