Minneritchie Well Project

(E09/1197) - Encounter 80%, Avoca 20%

Extensive historical exploration conducted within the Gascoyne complex in the 1970s identified numerous surfical and basement uranium occurrences, but little focused follow up work was completed.

Regional exploration in the late 1970s identified high grade uranium mineralisation in surface samples at Minneritchie Well. Assay results of >5kg/t U 3O 8 were collected from an area of intense radiometric anomalism. Although recommended, the area was never drill tested. Several additional radiometric anomalies within the project area were not visited in the initial evaluation of the area but will be included in Encounter's regional assessment program.

A program of rock chip sampling was completed during a reconnaissance field trip to the Minneritchie Well project. Sampling was focused in two areas of radiometric anomalism located in the southern half of the tenement. Eleven samples were taken of various outcropping lithologies. At both locations the most intense radiometric area corresponded with narrow zones of outcropping haematite altered metasediment. Sampling of the metasediment returned assays of up to 165ppm uranium with a broad zone of shearing and alteration.

Southwest WA Projects

(E70/2956 - 2958) - Encounter 80%, Avoca 20%

The Wongan Hills and Shackleton projects were granted during the quarter. These projects were secured in March 2006 following the release of the CRC-LEME laterite dataset for the South West Yilgarn. These two projects cover the standout laterite geochemical uranium sample clusters within this extensive dataset. Regional (9km spaced) laterite samples collected as part of the CRC-LEME sampling program have returned results of up to 50ppm U 3O 8. The Wongan Hills, Shackleton and Talbot targets show coincident anomalism in uranium, vanadium, phosphorous oxide (P 2O 5) and arsenic. Initial field visits were conducted during the quarter confirming uranium enrichment in the laterite at both projects.

Work has commenced on an infill laterite sampling program to delineate the areas of strong uranium geochemical anomalism. The sample clusters that are covered by the Wongan Hills and Shackleton tenements are highly anomalous. Infill laterite sampling will be completed at 1km spacing down existing roads and tracks in order to define the areas of highest uranium anomalism and provide focus for follow up geochemical and geophysical programs.