ADMIRALTY RESOURCES NL. — Capital/Financing Update 2007

Oct 9, 2007

ASX Company Announcement

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Admiralty Resources NL ACN 010 195 972

Level 14, 200 Queen Street Melbourne VIC 3000

[t] +61-3-96701838 [f] +61-3-9670 1898 [w] www.ady.com.au

10 October 2007 Company Announcements Office ASX Limited 20 Bridge Street SYDNEY NSW 2000

JAPONESITA TENEMENT RESOURCE UPGRADE 47.0 MILLION TONNES AT 21.6% Fe

Headline Summary

• Japonesita Indicated and Inferred Resource Estimation increased by 5.0 million tonnes to 47.0 million tonnes at 21.6% Fe;

• The mine is beneficiating ore as low as 9%, providing a potential indicated and inferred resource of 66.2 million tonnes at 18.8% Fe.

• Environmental permitting for Japonesita/Japonesa/Mirador will enable expansion of production to 3.9 million tonnes p.a.

• At a seven to one ratio using 18.8% iron ore, the mine is capable of producing 9.45 million tonnes of final product, giving this area at 2.0m tonnes per annum nearly five years mine life and US$434m at 2007 benchmark prices.

The board of directors are pleased to advise that we have received the attached letter from SRK, our Geological consultants in Chile, indicating a reserve upgrade at the JORC inferred and indicated level for the tenement adjacent to our existing mine pit, Japonesita as follows:

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Tenement Map of Japonesita

At a 15% Fe cut-off grade their indicated and inferred resources total 47.0 million tonnes at an average grade of 21.6% Fe. However, the mine is currently operating with a cut-off grade as low as 9% Fe, providing a potential total indicated and inferred resource of 66.2 million tonnes at 18.8% Fe as highlighted in the table above.

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This resource calculation is an excellent result for Cia Minera Santa Barbara of which Admiralty Resources holds a 60% interest. The Japonesa-Japonesita-Mirador area has an environmental permit of 3.9m tonnes per annum of production.

Santa Barbara Japonesa/Japonesita Mine Background

The Japonesa mine is one of ten existing mines operated in the 1960’s situated at Vallenar in Chile and has a total tenement area of 7,421 hectares. The production from this mine is expected to be at least one million, two hundred thousand tonnes of iron ore per annum after the plant is completed in March 2008 and has reached full capacity.

The iron ore mines owned by our joint venture company, Sociedad Contractual Minera Santa Barbara, contain alluvial, stockwork (vein type mineralisation) and hard rock (kiruna type) deposits and stockpiled iron ore fines (from the 1960’s). The Japonesa mine area covers 32 hectares. Sociedad Contractual Minera Santa Barbara has continued with rock sampling and geomagnetic work at two new mining tenements situated near Vallenar at Pampa Tololo and Serro Varilla, adjacent to the Los Colorados mine, one of the largest iron ore mines in Chile..

Full details of the final report will be released immediately they are received from SRK.

Yours sincerely,

Per Robert Michael Clarke Managing Director [e] mclarke@ady.com.au

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SRK Consulting (Chile) S.A. Matilde Salamanca 736 – Piso 6º Providencia - Santiago Chile santiago@srk.cl www.srk.cl Tel: +(56-2) 2690353 Fax: +(56-2) 2690322

Let 754/07 01-2109-03 October 1, 2007

IRON MINERAL RESOURCE AT THE JAPONESITA DEPOSIT, CHILE

Minera Santa Bárbara S.A. (Santa Bárbara) commissioned SRK Consulting, Chile (SRK), to carry out a mineral resource estimation on their Japonesita early-stage iron mineral project in Chile’s IV Region. This statement is an update of one made on August 24, 2007. The reason for this update is new information regarding the calculation of iron ore densities based on ore grade.

This letter forms part of a more complete report that will detail the procedures and methodology used in estimating and classifying the mineral resources at the Japonesita deposit. In summary, Santa Bárbara has drilled to date 31 reverse circulation holes on the project totalling 4,136 metres, of which 29 holes (3,866 metres) were used to construct the geologic model and estimate the mineral resource. Samples were analysed in the Minera Santa Bárbara Laboratory in Vallenar, Chile.

Table 1 below, shows the stated classified iron mineral resources at Japonesita. These resources are considered to be Indicated Mineral Resources according to the definition in the 2004 edition of the Australasian Code for Reporting of Exploration Results (JORC). Inferred resources are shown separately.

Table 1. Mineral Resource Statement (JORC)* for the Japonesita Iron Project, Region IV, Chile, SRK Consulting (Chile) S.A., October 1, 2007.

	Total Iron	Resource
Resource Classification	Tonnage	Iron Grade
	(Kilotonnes)	(Percent)
Measured	-	-
Indicated	25,139.5	19.4
Total Measured and Indicated	25,139.5	19.4
Inferred	21,888	24.1

• Reported at a cut-off of 15% percent Total Iron.

The following two tables show the sensitivity of the total iron resources to the cut-off grade.

Table 2. Japonesita Total Iron Resources by Grade Group and by Cut-Off Grade.

Group Offices: Africa Asia Australia Europe North America South America

Let-754-07-Japonesita Resource_Rev2-011007

SRK Consulting

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	Fe 0-20% UG1	Fe 0-20% UG1	UG2 Fe 20-30%	UG2 Fe 20-30%	UG3 Fe 30-40%	UG3 Fe 30-40%	Fe >40% UG4	Fe >40% UG4	TOTAL	TOTAL
Cut-off	Tonnage	Fe	Tonnage	Fe	Tonnage	Fe	Tonnage	Fe	Tonnage	Fe
Grade	T x 1000	%	T x 1000	%	T x 1000	%	T x 1000	%	T x 1000	%
40	0.0	0.0	12.4	43.0	344.9	43.7	285.4	44.8	642.7	44.2
30	47.1	31.9	1063.6	32.4	2391.7	35.0	802.1	39.1	4304.5	35.1
20	12188.7	22.0	7381.2	26.5	3748.9	31.9	821.3	38.9	24140.0	25.5
15	35025.7	19.1	7408.2	26.5	3769.8	31.9	823.8	38.8	47027.5	21.6
9	54211.1	16.5	7410.9	26.5	3770.2	31.9	824.5	38.8	66216.8	18.8
5	75323.6	13.9	7410.9	26.5	3770.2	31.9	824.5	38.8	87329.3	15.9
0	91188.0	12.0	7410.9	26.5	3770.2	31.9	824.5	38.8	103193.6	14.0
Total	91188.0	12.0	7410.9	26.5	3770.2	31.9	824.5	38.8	103193.6	14.0

Table 3. Japonesita Total Iron Resources by Resource Category and by Cut-Off Grade

	INDICATED	INDICATED	INFERRED	INFERRED	TOTAL	TOTAL
Cut-off Grade Fe %
	Tonnage	Fe	Tonnage	Fe	Tonnage	Fe
	T x 1000	%	T x 1000	%	T x 1000	%
40	135.3	45.5	507.4	43.9	642.7	44.2
30	567.0	36.6	3737.5	34.8	4304.5	35.1
20	8744.6	23.3	15395.4	26.8	24140.0	25.5
15	25139.5	19.4	21888.0	24.1	47027.5	21.6
9	42933.9	16.3	23282.8	23.4	66216.8	18.8
5	62508.8	13.4	24820.4	22.4	87329.3	15.9
0	78199.0	11.4	24994.6	22.3	103193.6	14.0
Total	78199.0	11.4	24994.6	22.3	103193.6	14.0

The geologic model was constructed by Santa Bárbara and reviewed and modified by SRK. This model consists of 8 vertical cross-sections oriented NW-SE, which are at a spacing of approximately 50 metres and 21 horizontal sections, with a 10 meter spacing. The current model was based on a total of 29 RC holes totalling 3,541 metres. Resources were estimated using the inverse distance squared methodology employing GEMCOM software.

The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled and reviewed by George G. Even, Principal Geologist of SRK Consulting, Chile (SRK), in Santiago, who is a member of the AusIMM (overseas branch). Mr. Even has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr. Even consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Mr. Ernesto Jaramillo, Senior Resource Geologist of SRK Consulting, Chile, performed the review and modification of the geologic model supplied by Santa Bárbara, as well as the estimation and classification of the mineral resources.

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George G. Even Principal Geologist SRK Consulting, Chile MAusIMM, MAIG

Let-754-07-Japonesita Resource_Rev2-011007