TENNANT CREEK IOCGU PROJECT

PROJECT OVERVIEW

On 7 June 2007, the Company announced the intention to purchase a large tenement package in the Tennant Creek Goldfield, Northern Territory. The tenements are highly prospective for the delineation of iron oxide-copper-gold 'IOCG' deposits.

Figure 1 below: Tennant Creek Geology & Historical Production

Figure 2 below: Tennant Creek Gravity & Targets

The purchase of unlisted entity Bungarra Resources Pty Ltd, which contains title to two groups of Exploration Licenses, comprising 13 Exploration Licences totalling in excess of 220 square kilometre in the Tennant Creek Goldfield of the Northern Territory. The Tennant Creek Goldfield has produced approximately 5 million ounces of gold and 345,000 tonnes of copper over an 80 year mining history.

The first group contains EL 23846 and EL 24158 totalling 40 graticular blocks (129.30 square kilometres) within the Tennant Creek Goldfield in the Northern Territory as shown on Figure 1. The two tenements lie on the Philip Creek Station which is held under Perpetual Pastoral Lease 946 and therefore not affected by Aboriginal Land Rights or Native title issues.

The two Exploration Licences are located between four (Warrego, White Devil, Orlando and Gecko) of the nine largest producing mines which have produced gold, copper and bismuth valued at over $6.5 billion at today's metal prices. Bungarra has recently carried out close spaced gravity surveys across 50% of its tenements. This survey has identified 24 targets of which 7 have geophysical signatures similar to Warrego and White Devil and 5 have geophysical signatures similar to Nobles Nob. There are plans to complete close space gravity surveying across the remainder of its tenements within the coming months.

The second group of tenements contains 11 Exploration Licenses comprising 91 km². Geologically only 6 of the Exploration Licenses have been prospected and have exploration targets. The remaining 5 blocks will require gravity surveying to enhance their prospectivity and to define drilling targets.

One of these tenements, EL 23828 covers 8.8 km² and is held freehold. This is the most prospective EL in this suite of tenements and contains several significant magnetic anomalies of similar size to Juno. The EL is considered to have high potential for mineralization akin to Juno which produced 863,000 ounces of gold at an average grade of 59 g/t gold, almost two ounces per tonne.(See figure. 4)

The historical mined grades were rich in both gold and copper as shown in the following table.

Source: Gold Deposits of the Northern Territory, Report 11, NTGS, Department of Mines and Energy, pg.47

Gold and copper mineralisation is associated with hydrothermal replacement bodies closely associated with ironstone lenses composed of magnetite, quartz, chlorite and haematite, commonly known as Iron Oxide Copper Gold ('IOCG') deposits. Past exploration has relied heavily upon magnetics for detecting magnetic ironstone bodies, whereas gravity is now being used successfully to detect non-magnetic mineralised ironstone deposits.

New advanced exploration techniques and advances understanding IOCG mineralisation now provide the Company with an opportunity to test the prospectivity and significance of these projects for the delineation of large scale economic mineralisation.

With close proximity to the Warrego mill and the historical Warrego, Orlando, White Devil, Peko, Nobles Nob and Juno mines and a recent renewed focus on base metals in the Tennant Creek district, the prospectivity for these tenements is promising.

Exploration undertaken at the Tennant Creek Project during the past quarter has focused on completing the close-spaced gravity surveys across the iron oxide copper gold 'IOCG' project area. Interpretation of the initial results has identified several potential drill-targets where gravity anomalies are coincident with more subtle magnetic anomalies. The most obvious of these anomalies has been further investigated using EM methods which successfully identified a large, chargeable metallic body at shallow levels that is coincident with both the gravity and magnetic anomalies and forms an excellent priority drill target at the Great Western Prospect (Figure 3).

The data collation process is ongoing for the Tennant Creek Project area and is due for completion by March, 2008, at which point a major target generation exercise will be undertaken to identify and rank priority drill targets as a precursor to aggressive exploration drilling that is expected to commence in April/May 2008.

Interpretation of the recently completed close spaced gravity programme covering the remaining tenements not previously surveyed at the beginning of last year is ongoing by Southern Geoscience Consultants. New target generation will occur this coming quarter with recommendations for follow up EM or IP surveys.