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Impact Minerals Quarterly Report for the period ending December 2009



Market Cap
A$27 M ($0.23 p/s)
Issued Capital
117,403,328
Directors
Peter Unsworth
Chairman
Dr Mike Jones
Managing Director
Dr Rodney Fripp
Executive Director
Paul Ingram
Non-Executive Director
Mark Pitts
Company Secretary
www.impactminerals.com.au
309 Newcastle Street
Northbridge
Western Australia 6003
tel +61 (8) 6454 6666
fax +61 (8) 6454 6667
email

ASX ANNOUNCEMENT
ASX: IPT
Date: 22 January 2009
Number: 133/220110
DECEMBER 2009 QUARTERLY REPORT
SUMMARY
Uranium
• Botswana (Africa, Impact 100%): Soil sampling completed at the
Sua prospect and results recieved for the Lekobolo Prospect.

At
Lekobolo 25 RC drill holes completed, and a further 37 holes planned
for late January.

Down-hole surveys of first 25 holes commenced.
• Quinns Lake (WA, Impact 100%) and Yarrabubba (Impact 20%)
Projects: Discussions are in progress to consider possible
metallurgical studies of the Nowthanna mineralisation.
PGE - Nickel
• Strategic Alliance with Impala Platinum Limited: A significant
target identified and field results indicate further work warranted.
• Yarrabubba Nickel JV Project (WA, Impact 20%): Detailed infill
and step-out soil sampling programmes at 11 targets, comprising
1,700 samples, completed.

Results due in March;.
Gold
• Drummond Basin Projects (QLD, Impact 100%): Follow-up field
checking and soil geochemistry completed at 16 targets.

700 soil and
rock samples sent for assay, results due mid-next Quarter .

Further
reconnaissance work planned.
• Compilation of previous exploration work initiated on recently
granted tenements at the Killarney Project near Mackay and the Moly
King Project near Stanthorpe, both prospective for large gold-copper
deposits.
• Impact is currently assessing options to maximise shareholder value
from these highly prospective gold-copper assets, including a possible
separate ASX-listed company spin-out in 2010.
Corporate and Business Development
• 24 million new ordinary shares to raise $5 million were placed during
and subsequent to the end of the Quarter.

Following these placements
the Company has total shares on issue of 117,403,328.
• Cash position as at December 31st was $5.9 million.

Receipt of the
second tranche of the capital raising in early January brings the total
cash to about $8 million.
1.

Botswana Uranium Project (Impact 100%)
During the previous quarter Impact commenced a significant exploration programme for
uranium on its extensive areas of Prospecting Licences in Botswana.

These total 27,000
square kilometres in extent.
These Licences cover 350 km of the strike extensions of rocks that host many significant
uranium deposits throughout southern Africa, including the adjacent uranium deposits
owned by A-Cap Resources Limited at the Letlhakane Project near Serule (Figure 1).
Here A-Cap has reported a combined Indicated and Inferred Resource of 158 Mlb of
uranium oxide at an average grade of 154 ppm at a cut-off grade of 100 ppm, in deposits
hosted both by near-surface calcrete and by Karoo Group sedimentary rocks.

A bankable
feasibility study on the Letlhakane Project is in progress.
China Growth Minerals Limited, Impact"s largest shareholder, also has about a 16%
shareholding in A-Cap.
Impact"s licences are prospective for three types of uranium deposits:
• deposits hosted by Karoo sedimentary rocks, which host a number of large uranium
deposits throughout southern Africa, including at Letlhakane;
• uranium hosted by calcrete in Cainozoic palaeochannels, a style of mineralisation well
known in Australia and Namibia; and
• deposits within playa (salt) lakes which, in Australia and elsewhere in Africa, are
known to host significant uranium deposits.
Impact has identified 18 such target areas with a combined strike length of more than 400
km within its licences (Figure 1).

These generally comprise elongate zones within which there
are variably exposed calcretes and/or prospective Karoo sedimentary rocks.

Many have
elevated surface uranium responses in the regional airborne radiometric data and in ground
spectrometer readings.
Five of these target areas have been prioritised for follow-up work on the basis of the
widespread surface uranium anomalism in calcretes and sandstones, backed by regional
mapping, ground reconnaissance work and sampling.

These are called Lekolobo, Kodibeleng,
Sua, Ikongwe and Shoshong.
During the previous Quarter regional 1,000 m by 500 m spaced soil sampling programmes
were completed at the Lekobolo and Kodibeleng targets and commenced at the Sua area.
Lekobolo: Drilling in Progress
At the Lekobolo Prospect, which is about 20 km south west of A-Cap"s Letlhakane Project,
the analytical results for the Lekobolo soil geochemistry programme were received during the
December Quarter.

These licences cover the interpreted south western extension of the rocks
that host uranium mineralisation at Letlhakane.
The survey covered an area of about 470 square kilometres and comprised 945 samples
collected on a 1,000 m by 500 m grid.

The results of this survey defined an area of about
140 square kilometres of anomalous values, within which there are numerous zones of more
elevated values, each of which warrants drill testing.
During the December Quarter a reconnaissance drill programme commenced and 25 holes
were drilled to depths ranging from 30 to 70 metres, at variable spacings of between 400 m
and 1,000 metres.
Drilling stopped for the Botswana holiday period and recommenced in mid-January.

A
down-hole radiometric survey to measure uranium in the completed drill holes has
commenced.

Figure 2.

Geology of the Lekobolo Target
Kodibeleng - Ikongwe - Shoshong: 80 km of calcrete palaeochannels
These three target areas are each at least 20 km long and interpreted as Kalahari
palaeochannels containing calcrete (Figure 3).

They are buried by up to five metres of sand
and soil and are prospective for calcrete-hosted uranium deposits such as the Yeelirrie
deposit in Western Australia and Langer Heinrich in Namibia.
The headwaters of all three channels drain from Archaean, Proterozoic and Karoo-aged
rocks that all contain elevated uranium values of up to 80 ppm eU* (measured with a
portable spectrometer).

Such uranium-enriched rocks comprise a fertile source for uranium
that may deposit in the younger channels.
At one locality in the Kodibeleng palaeochannel the calcrete has been eroded to reveal up to
3 m of calcreted Kalahari sandstones and conglomerates which, at the base, contain up to 35
ppm eU* (measured with a portable spectrometer), that is, a ten times greater response than
at surface.
Figure 3.

Radiometric image of the Kodibeleng, Ikongwe and Shoshong channels.
2.

Quinns Lake (Impact 100%) and Yarrabubba (Impact 20%)
Uranium and Nickel Projects, Western Australia
The Quinns Lake (E51/1075) and Yarrabubba Projects (E51/1072-1073, E20/563-567) are
located 70 km south east of Meekatharra in Western Australia and comprise adjacent
tenement holdings with different ownership structures and with common exploration
potential for deposits of calcrete-hosted uranium oxide and Sudbury-style World Class
nickel-copper-PGE deposits.

The Nowthanna calcrete-hosted uranium deposit occurs in part
in both the Quinns Lake Project and in the Yarrabubba Project which is in Joint Venture with
CITIC Nickel Australia Pty Ltd, part of the CITIC Group (60%), as well as a syndicate of
investors (20%).
Impact Minerals owns approximately 40% of the Inferred Resource of uranium oxide within
the Nowthanna deposit (JORC 2004).

At a cut-off grade of 200 ppm uranium oxide
Impact"s 40% share of the deposit is about 3.92 Mt at an average grade of 450 ppm, for a
contained 1,800 t or 4 million pounds of uranium oxide.
The Quinns Lake-Yarrabubba area has most of the geological characteristics of the World
Class Sudbury nickel mining camp in Canada.

An extremely large sub-circular magnetic low
in regional magnetic data and outcrops with distinctive geological structures are interpreted
to be the signature of a structure caused by a major meteorite impact.

It is generally accepted
Kodibeleng
Ikongwe
Shoshong
that such an impact occurred at Sudbury and that this gave rise to the many large nickelcopper-
PGM deposits in that area.
Uranium Exploration
During the Quarter Impact continued to review the project with a view to progressing a
possible consolidation of the ownership of the Nowthanna deposit, together with possible
metallurgical studies.
Nickel Exploration on the Yarrabubba Project (Impact 20%)
Detailed MMI Soil Geochemistry Surveys
During the previous quarter field checking of areas of interest identified in the regional MMI
soil sampling programme confirmed that more detailed infill and step-out soil sample
programmes are required over the 11 higher priority targets.

During the December Quarter
about 1,700 soil samples were collected at these 11 areas and these have been submitted for
analysis.

Results are expected mid-next Quarter.
3.

Strategic Alliance with Impala Platinum Limited to Explore for and
Develop PGE Deposits in Southern Africa
In mid-2008 the Company entered into a Strategic Alliance to explore for and develop
deposits containing platinum group metals (PGM"s) in southern Africa with Impala Platinum
Limited, the World"s second largest platinum producer.
The Alliance will operate for a minimum period of two years and Impala Platinum will fund
project generation work done by Impact up to US$400,000 per year and in return will have
the first right to earn equity in any projects identified.

Projects in which Impala Platinum
elects to earn an interest will require a minimum expenditure by Impala of US$1 million
before withdrawal, and a further US$1 million expenditure to earn 50%.

Any projects which
Impala Platinum does not elect to progress with can be retained by Impact.
During the Quarter some particularly prospective areas have been identified and a
preliminary reconnaissance field programme completed.

The results indicate that further
work is warranted.
Project generation work in a number of countries is on-going.
4.

Gold Exploration in Queensland (Impact 100%)
Impact owns 100% of eight exploration licences in the Drummond Basin called Drummond
East (EPMs 14927-929), Drummond West (EPMs 14932-934) and Clermont (EPMs 14116-
117), with a total area of about 6,000 square kilometres (Figure 4).

The Drummond Basin is
one of Australia"s most prospective areas for significant epithermal vein and stockwork style
gold deposits and for bulk-tonnage disseminated gold and gold-copper-molybdenum
deposits.

It contains the four million ounce Vera-Nancy-Pajingo active mining centre as well
as dormant mines at Twin Hills, Yandan, Mt.

Coolon and Wirralie.

At the Anthony
Prospect, Zamia Gold Mines Limited has intersected visible porphyry-hosted mineralisation
in 14 diamond drill holes and is continuing to drill.
Impact has completed major target generation exercises over the project areas and more than
60 targets have been identified, of which 18 are ranked as high priority and 25 are for
porphyry style deposits.
Follow-up ground
exploration work
commenced on the higher
priority areas in October.
At the Drummond West
Project, 100 km south of
Charters Towers,
reconnaissance soil
geochemistry surveys
and/or field checking
have been completed over
16 targets identified in the
airborne geophysical data
and the previous
exploration data.
About 700 soil and rock
chip samples have been
collected and assay
results are due in early
February.

Further
reconnaissance work will
continue as soon as
possible in 2010, subject
to weather conditions.
Also in Queensland,
compilation of previous
exploration work has
commenced on recently
granted tenements at
Impact"s two other gold
and gold-copper projects:
the Killarney Project near
Mackay and the Moly
King Project near
Stanthorpe.
Impact is currently
assessing options to
maximise shareholder
value from these highly
prospective gold-copper
assets, including a
possible separate ASXlisted
company spin-out
in 2010.
Figure 4.

Impact"s tenements in the Drummond Basin, Central Queensland.
5.

Corporate and Business Development
Capital Raising
On 2nd December 2009 Impact announced its intention to raise $5 million through a nonunderwritten
placement of 24 million ordinary shares at 21 cents per share.

Hartleys Limited
was the Broker to the Offer.
Following the end of the quarter the Company completed the second tranche of the
placement and received approval from shareholders at a General Meeting held on 7th
January 2010.

The Company now has 117,403,328 shares on issue.
Including the funds received from the second placement in January 2010 the Company has a
current cash position of approximately $8 million.
The funds raised from the placement will be applied mainly to accelerate exploration on
Impact"s large Botswana uranium project where drilling commenced in early December, to
test several uranium targets at the Lekobolo Prospect.
The Company will also be able to increase its focus on its search for more advanced projects
in Africa and Australia, and give further focus to its PGE generative programme in southern
Africa, the Impala Platinum Strategic Alliance.

This Alliance is funded by Impala Platinum
Limited.
Further, the Company is now able to advance its very prospective Queensland gold-copper
projects, and is currently assessing options to maximise shareholder value from these,
including a possible separate ASX-listed company spin-out in 2010.
Dr Michael G Jones
Managing Director
* eU is the equivalent uranium content of materials calculated from both airborne radiometric
data and measurements taken with an industry-standard portable spectrometer.
The review of exploration activities and results contained in this report is based on information
compiled by Dr Mike Jones, a Member of the Australian Institute of Geoscientists.

He is a director of
the company and works full time for Impact Minerals Limited.

He has sufficient experience which is
relevant to the style of mineralisation and types of deposits under consideration and to the activity
which he is undertaking to qualify as a Competent Person as defined in the December 2004 edition of
the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves (the
JORC Code).

Mike Jones has consented to the inclusion in the report of the matters based on his
information in the form and context in which it appears.

 




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