ARCHER MATERIALS LIMITED — AGM Information 2011

Nov 24, 2011

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Archer Exploration Limited

2011 Annual General Meeting

25[th] November 2011

Gerard Anderson Managing Director

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Disclaimer

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Competent persons statement

The exploration results reported herein, insofar as they relate to mineralisation, are based on information compiled by Mr. Wade Bollenhagen, Exploration Manager of Archer Exploration Limited. Mr. Bollenhagen is a Member of the Australasian Institute of Mining and Metallurgy who has more than sixteen years experience in the field of activity being reported. Mr. Bollenhagen consents to the inclusion in the report of matters based on his information in the form and context in which it appears.

Forward looking statements

The information in this presentation is published to inform you about Archer Exploration Limited and its activities. Some statements in this presentation regarding estimates or future events are forward looking statements.

Although Archer Exploration Limited believes that its expectations reflected in these forwardlooking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results and outcomes will be consistent with these forwardlooking statements.

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Presentation Outline

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• Corporate Overview

• Company Assets

• Project Pipeline

• 2011 Highlights

• Graphite

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• Magnesite

• West Roxby Uranium and IOCG Targets

• Manganese

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Corporate Overview

ASX Code : AXE

Archer Exploration

Shares on Issue 67,142,763 Unlisted Options on Issue 6,270,000 Share price at 21/11/2011 $0.16 Market Capitalisation A$11.7 million Cash at Bank as at 31/10/2011 ≈A$2.1million

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Directors

Chairman

Directors

Senior Staff

Greg English

Gerard Anderson Tom Phillips AM Alice McCleary Hon. John Dawkins AO Peter Meers

Wade Bollenhagen Claude Walter

		Mineral	Exposure
	•	Graphite	•Uranium
	•	Magnesite/magnesia	•Iron Ore
	•	Manganese REE	•Phosphate
	•	Gold	•Coal CSG
	•	Copper IOCG	•Barite

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The limited number of shares on issue and commodity exposure offers shareholders considerable leverage as exploration advances and deposits mature.

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Company Assets

Exploration Tenements

• 19 granted mineral tenements covering portions of Eyre Peninsula, Leigh Creek, West Roxby, Burra and World’s End areas.

• 3 ELA’s.

• 100% of mineral rights other than uranium on Wildhorse Plain

Graphite

• 100% owned Sugarloaf deposit has Exploration Target of 24 – 37Mt grading 10-12% total carbon*

• 100% of several other higher metamorphic grade flake graphite occurrences in “graphite province”.

*The potential quantities and grades presented are conceptual in nature, there has been insufficient exploration to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource

Magnesite

JORC Measured, Indicated and Inferred Resources at Leigh Creek of 413Mt grading 40.3% MgO. (Source MDL 2001 Report)

Manganese

Seven manganese prospects including Ketchowla and Salt Creek. Mn & Fe JV with OMM Holdings over EL3711 Jamieson Tank.

IOCG

Iron oxide copper gold and uranium targets - West Roxby.

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Archer’s tenement status as at 25[th] November 2011

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Large portfolio of prospective tenements hosting at least two very promising mineral deposits

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Project Pipeline ≈ 100%
Reserve
Mt Hutton
Archer is an exploration company. The Pug Hill
principal assets of the Company are its Resource Termination Hill 4 ≈ 70% Probability of
significant mineral tenements and mineral
Development at T0
deposits. Mt Playfair Witchelina
≈ 30% where To = Nov 2011
Advanced Exploration Project 2
Shareholder value is increased by;
Sugarloaf Graphite
- moving projects up the
Ketchowla Mn / REE ≈ 10% * SAMAG reports
development pyramid,
- discovering new deposits, Cost Mineralised Project WHP Graphite 7
- joint ventures, WHP Fe Salt Ck Mn
WHP Cu
- project acquisition,
Bender Au/Cu Napoleon’s Hat Au
- asset sale. Watervale Au
Actual # of Projects
Geophysical / Geochemical Anomaly Apollo U 6
Island Lagoon IOCG
Pindari Ni / REE World’s End Cu
Evelyn Dam IOCG
WHP - Au
Tenement / Geological Target 23
3 ELA’s (Phosphate & Barite, REE, Coal)
19 Granted Tenements
100% of non uranium mineral rights on WHP
Concept / Project Review 4
Commodity Reviews
Industrial Minerals –
Strategic Minerals REE West Roxby IOCG Magnesite, Graphite,
Phosphate, Barite
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Probability of Success

Archer has an several mineral projects at various stages of evaluation

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2011 Highlights

Graphite

Sugarloaf

• Exploration Target defined.

• Petrology indicating fine graphite averaging 100µm in size.

Regional

• Large flake graphite identified at several locations - Campoona, Campoona South , Council Pit.

• Airborne EM survey highlighted strike and depth continuity to Campoona , Campoona South and Grid 2.

• Drilling at Campoona South and Grid 2.

Metallurgy

• Critical scoping flotation tests underway on RC hammer samples. First progress results for Sugarloaf have

• given 50% C in first rougher concentrate indicating >80% C concentrate likely. Other samples sent to China and Germany for liberation tests.

Magnesite

• Flotation tests continuing - best result to date reducing SiO2 to 1.9%. Target is <1.5% SiO2.

• Further tests on crushing and tumbling to abrade fine talc rims on magnesite.

• Success would unlock significant value for shareholders.

West Roxby

• Good progress with NTMA.

Manganese

• Ketchowla dense media separation produced DSO quality product.

• Salt Creek drilling intersected wide low grade manganese.

Copper

• Low grade copper intersected at Emu Plains in footwall to predicted lode.

Coal/CTL

• Ediacara ELA granted.

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Graphite

Graphite Properties:

Metallic properties:

• Excellent conductor of heat and electricity

• Highest natural strength and stiffness of any material

Nonmetallic properties:

• High natural lubricity

• Maintains strength and stability to temperatures in excess of 3,600[o] C

• One of the lightest reinforcing agents

• Highly resistant to chemical attack

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Graphite Market

Photomicrograph - Growth spirals in graphite crystal

Amorphous Graphite

Microcrystalline graphite ≈70% of world production and consumption. Graphite content ranges from 15% to 99% C. Widely used in industrial applications for its high melting point, resistance to thermal shock and lubrication .

Crystalline Flake Graphite

Flake graphite occurs only in a few locations around the world usually as flat platy crystals disseminated in metamorphic rocks. Total carbon grades are generally low ranging mostly from 2-6% C and rarely >10% C.

Flake graphite is classified and marketed based on the size of the graphite crystals (flake size) and by the carbon content (generally >94%C). Strong growth from high tech uses. Three main flake sizes:

Fine flake (-100 mesh or <149µm)

Medium flake (+100 -80 mesh or 149–177µm) Large flake (+80 mesh or >177µm)

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Substitution of graphite by other minerals is highly unlikely as there is simply no other mineral so versatile and with such unique physical and chemical properties.

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Uses for Graphite

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Carbon steel forging

Electric motor brushes

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Graphite crucibles
Refractory bricks to line blast furnaces
Pencils
Valves
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Dry cell batteries Graphite brake pads

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Emerging New Technology Uses for Graphite

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Construction of a high temperature PEMFC: Bipolar plate as electrode with in-milled gas channel structure, fabricated from conductive composites (enhanced with graphite, carbon black, carbon fiber, and/or carbon nanotubes for more conductivity);[[5]] Porous carbon papers; reactive layer, usually on the polymer membrane applied; polymer membrane

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Ceramics

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Ceramic fibres

Graphite stripes are deposited onto silicon with industry-

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Zero EV motor cycles

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EVs & HEVs - Tesla’s Roadster and the Tesla S

Super high strength composites

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Graphene - the New Super Material

Graphene is a unique atom-thick carbon-based material derived from graphite that has exceptional physical and chemical properties. Applications are continually being generated as research unlocks its unique attributes:

• Superior composite materials that have high-specific stiffness and strength.

• Nano-electronics for logic, memory and interconnects.

• Transparent and electrically conductive films for image display and solar photovoltaic

• devices.

• Energy storage devices such as batteries and ultra-capacitors.

• Thermal management.

Nearly 200 companies, including Intel and IBM, are currently involved in graphene research.

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Super fast graphene computer chips

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Graphene molecular structure
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Film of graphene an atom thick
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Graphite Supply* – China first, then daylight….

Country	Mine Production 2009 (kt)	Mine Production 2010e (kt)	Reserves (kt)
Unites States	-	-	-
Brazil	76	76	360
Canada	25	25	(4)
China	800	800	55,000
India	130	130	5,200
North Korea	30	30	(4)
Madagascar	5	5	940
Mexico	5	5	3,100
Norway	2	2	(4)
Sri Lanka	11	11	(4)
Ukraine	6	6	(4)
Other Countries	3	3	6,400
World Total (rounded)	1,100	1,100	71,000

*** Source - USGS**

China produces around 75% of the world’s graphite. Quality is declining and supply suffers from the seasonal closure of mines in northern China over winter. Several SOE operations have been closed to preserve resources. China has imposed a 20% export duty plus a 17% VAT and has instituted an export licensing system to ensure supply to its domestic economy.

The dominance of China as a producer coupled with measures introduced by the Chinese government are creating supply concerns for the rest of the world. Supply issues are exacerbated by the lack of exploration and new mine development.

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Graphite Prices

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Graphite Prices Rising on Strong Demand:

Graphite has a posted price however prices are negotiated between the buyer and seller based on graphite crystal size and the carbon content with settled prices generally around the posted price level.

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Graphite Product	Carbon Content (%)	Graphite Size (µm)	Price (US$/t)
Large Flake	94-97%	>177µm	$2,500 - $3,000
Medium Flake	94-97%	149µm - 177µm	$2,200 - $2,500
Fine Flake	94-97%	<149µm	$2,000 - $2,400
Amorphous	80-85%	≈ >37µm	$850

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Graphite Demand Trends

• Traditional Uses : Steelmaking, refractories, auto parts, gaskets, composites, batteries, semiconductors, carbon

• brushes and oils and greases is increasing with increasing industrial output.

• Emerging Uses : Growth in the flake market from increased demand from high value strategic applications in

• electronics and computers and high tech uses constantly being identified.

1. Lithium-ion battery market : Having a significant impact on the graphite market especially for the prized flake graphite as the demand for mobile energy storage systems increases. Lithium-ion batteries for EV and HEVs - USA has 200,000,000 of the estimated 750,000,000 cars in the world. UCLA research predicts that by 2030, 64% of all US made cars will be electric. US government has provided billions of dollars in loans, grants, and tax incentives for research in support of US auto industry and battery manufacture.

• ( Each HEV requires ≈ 11kgs spherical graphite. Up to 70% of flake is destroyed making spherical graphite)

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BMW i8 Hybrid Electric Vehicle (HEV)

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Porsche HEV 918 Spyder 718 horsepower, mid-engine V-8 and two electric motors. Claim 78.4 mpg.

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Audi e-Tron concept car Electric Vehicle (EV)

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EVs and HEVs predicted to dominate future vehicle market

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Graphite Demand Trends

Growth in the flake market also coming from green energy initiatives including fuel cells and new generation nuclear power and from the evolving applications for graphene.

2. Green energy initiatives : especially fuel cells and solar electricity applications. Governments worldwide are backing green energy initiatives in response to the threat of climate change. Fuel cell technology is seen as the future for sustainable, portable, self- contained energy solutions.

3. Pebble bed nuclear reactors (PBNR) : offer a solution for safe nuclear power. In PBNRs the fuel is embedded in graphite balls . PBNRs are cheaper to build and operate than conventional reactors, use inert gases as coolants rather than complex water cooling systems and cool naturally when shut down. They operate at higher temperatures giving more fuel efficiency and they can directly heat fluids for low pressure gas turbines.

4. Graphene : is set to have a profound impact on the future development of mankind. Potential applications include replacement of silicon in semi-conductors; replacing of carbon fibers in composite materials to enable lighter and stronger aircraft; an additive or coating to plastics to enable them to conduct electricity; increasing the efficiency of electric batteries; transparent conductive coatings for solar cells etc. The list is expanding all the time.

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Graphite and graphene are very much minerals of the “new age” offering a growing array of opportunities in the worldwide push for green energy solutions.

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Graphite Market Trends

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Graphite is facing increasing demand worldwide from growing traditional uses and rapidly emerging new technological applications.

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Archer likens the emerging importance of graphite to that of the recent history of Rare Earth Elements (“REE”) and lithium. Few people realized how quickly REE and lithium would increase in importance as more and more advanced applications were discovered. Fewer understood the strategic importance of REEs and lithium. The Company with its extensive landholding hosting a large number of “high grade” outcropping graphite occurrences (including rare and prized large flake graphite) is in a strong position to rapidly advance exploration and capitalize on the surging demand .

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Anyone can have 20:20 vision in hindsight.

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Significant Land Position

Flake potential – Campoona, Campoona South - Grid 2, Mt Shannan, Wilklow & Others

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Archer has a substantial land position in “graphite province”

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Sugarloaf Graphite

• Sugarloaf area first explored for gold, base metals and uranium.

• Goldstream then Helix identified a coincident gold and copper soil anomaly. The two companies drilled a total of 41 drill holes across Sugarloaf. Best intercept was 3m @ 1g/t Au in a laminated quartz vein.

• 23 of the 41 drill holes recorded wide intervals of graphite however no assaying for carbon was undertaken. Historic samples were not retained.

• In 2008 Archer drilled 5 RC holes to further test the gold and copper potential. The northernmost drill line including CHRC010 was assayed for carbon.

• In 2010 Archer negotiated a farm-in agreement on the neighbouring Wildhorse Plain primarily to explore for manganese, copper and iron ore. A review of the exploration literature on Wildhorse Plain identified widespread graphite occurrences. This review highlighted the potential of the area for graphite.

• In 2011 Archer drilled 4 holes essentially twinning historic drill holes to assess the accuracy of reported graphite intervals. This results of this work was the start of Archer’s foray into graphite.

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Numerous drill holes drilled to test gold-copper soil anomalism recorded significant graphite intercepts over a >2km strike

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Graphite recorded over wide drill intercepts in numerous holes

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Sugarloaf Graphite

2011 Drilling

• Drilling in March – April 2011 confirmed overall strike extent of the highly graphitic schist.

• A number of samples from varying depths were collected for detailed petrology.

Hold ID	From (m)	To (m)	Interval (m)	Total Carbon (%)
SLRC11 _001	60	82	22	12.31%
	96	139	43	10.43%
	139	144	5	6.50%
SLRC11_002	0	9	9	8.77%
	9	20	11	5.78%
	28	38	10	13.05%
	47	63	16	11.08%
	64	75	11	7.05%
	75	93	18	10.77%
SLRC11_003	47	53	6	9.90%
SLRC11_004	81	90	9	6.60%
	90	103	13	15.00%
	106	113	7	10.10%
	124	140	16	12.80%
	140	148	8	8.00%
	148	151	3	17.00%

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Location of 2011 drill holes

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Whilst at an early stage of evaluation, Sugarloaf has excellent potential

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Sugarloaf Graphite

Summary

• 100% owned Sugarloaf deposit has Exploration Potential of 24 – 37Mt grading 10-12% total

• carbon*. The estimate is for the western graphite limb only.

• *The potential quantities and grades presented are conceptual in nature, there has been insufficient exploration to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource

• Petrology indicates deposit consists of fine graphite with average size of 100µm which is likely to provide largely amorphous product.

• Deposit outcrops, is sub-vertically dipping and has a consistent aggregate true width of 40 metres.

• Open along strike to the north and at depth.

• Trenching and aircore / diamond drilling planned for January – March 2012 to provide appropriate samples for graphite characterisation tests.

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Sugarloaf Exploration Potential very likely to increase

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Wildhorse Plain Graphite

Significant regional potential – Campoona

In the mid 1980s airborne electro-magnetic surveys were conducted as part of exploration focused on base metals. A highly conductive graphitic schist over 6km long was identified adjacent to the Lower Middleback Jaspilite at Campoona Hill . A historic shaft (circa 1915) exists on the graphitic schist.

Other elongate EM conductors, which are parallel to the graphitic schist were drilled by ESSO at High Bluff and were confirmed as graphitic in origin.

A 1991 petrology report identified the graphite ranging in size 0.1mm to 0.3mm with an average flake size of 0.2mm.

Two samples were collected in June 2011 and submitted for petrological examination by Pontifex and Associates in Adelaide. Results confirm the 1991 observations. Graphite content was reported as 25-30%. Size ranged mostly 10 µm-50 µm (width) x 250 µm (length).

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Close up photo of Campoona Shaft spoil showing large flake

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Photomicrograph - reflected light, graphite is the white mineral, scale is 100µm (0.1mm)

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Flake graphite at Campoona with >6km strike extent

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Wildhorse Plain Graphite

Significant potential – Campoona South

At the southern end of the Campoona EM anomalies lies a graphite outcrop that assayed 25.4% C .

Hand specimens had visible large flake graphite to 1,000µm (1mm).

Petrological examination reported graphite content at 15-20%. Overall graphite size ranged from 5µm to 80µm (width) x 300µm (length) with an average size estimated at 50µm x 250µm (large flake).

Graphite occurs within “heterogeneous, fine layered quartz-feldspar microgneiss, together with quartz-graphite schist”.

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Photomicrograph - reflected light, graphite clots are the white aggregates, scale is 200µm (0.2mm)

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Prominent outcrop at Campoona South.

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Hand specimen from Campoona South showing large graphite flakes up to 1mm

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Flake graphite identified in several locations on Wildhorse Plain associated with high grade metamorphic rocks

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Wildhorse Plain Graphite

Significant potential – Council Pit

The Council Pit is a disused historic borrow pit.

The graphite content was reported between 15-20%. The overall size of graphite ranges from 2µm to 50µm (width) x 1,000µm (length) with the average 20µm x 300µm (large flake). The range in length to 1,000µm is classified in the graphite market as Super Large graphite.

The graphite occurs within “schistose micro-gneiss, with thin intricately intercalated schistose layers of quartz-feldspar-graphite and scattered amphiboles”.

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Photomicrograph - reflected light photograph, graphite is white to light yellowish, scale is 50µm

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Flake graphite identified in several locations on Wildhorse Plain associated with high grade metamorphic rocks

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Some Other Wildhorse Plain Graphite Targets

A405

Graphite was reported in drill holes as a part of uranium exploration in 1968 by Kerr McGee.

Hole A405/2 graphite flakes were reported from 32 to 56 metres, within altered dolomites. Hole A405/3 medium crystalline graphite was reported over a few metres.

Hole A405/3A common graphite flakes were reported from 28 to 41m downhole. Hole A 405/3B trace graphite flake from 41 to 52m (EOH)

Wilklow

Graphite was reported during exploration for uranium. Historically a sample of graphitic schist was taken from the surface that “ yielded 4.25% of flake graphite which assayed 39.25% carbon.

Two holes were drilled in 1952, both intersected graphite within clay-rich weathered quartzite.

A 1991 drill hole testing a IP/resistivity anomaly intersected high grade metamorphic rocks with graphite. The IP anomaly was attributed to the graphite. A sample submitted for petrology reported “moderate amounts of graphite forming well developed flakes up to 0.5mm in length.” The metamorphic grade of these rocks is conducive to graphite flake development.

Calkookra

Calkookra was a historic underground copper mine. In 1968 exploration for uranium identified graphite in an exploration drill hole. Although no qualitative work was performed on the graphite, the metamorphic grade of the surrounding rocks (mylonite and amphibolite) is encouraging for large flake development. A copper enriched sample was submitted for petrology in 1983, it was reported as having 5% graphite with flakes of approximately 0.3mm in length.

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Literature searches reveal further flake graphite locations on Wildhorse Plain

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Archer Graphite Summary

Deposit Comparison

Company	Deposit	Lower Cut-off Grade (%C)	Resourc e (t)	Resource Grade (%C)	Graphite Size (µm)
Archer Exploration	Sugarloaf	1%C	40Mt*	11.7%C*	Fine/Amorphous
Northern Graphite	Bissett Creek	1%C	20Mt	1.97%C	Large
		2%C	8.8Mt	2.58%	Large
		3%C	1.3Mt	3.27%	Large
SER – Mega Graphite	Uley Main **Road1 **	3.8%C	6.6Mt	8.7%C	Medium and Large

*The potential quantities and grades presented are conceptual in nature, there has been insufficient exploration to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource

1 Uley Exploration Potential 25-150Mt (Recent sale/demerger with Mega Graphite values Uley at >AUD$70 million). Historically Uley has produced high quality flake graphite.

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Archer Graphite – Summary

Known Knowns

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• Exploration is in the formative stages having started in April 2011.

• Large prospective land bank >900km[2] .

• Exploration has consisted of rock chip sampling, RC drilling and detailed petrology.

• Through literature searches Archer identified numerous graphite prospects – Sugarloaf, Campoona – Campoona South, Grid 2, A405, Mt Shannan, Council Pit, Wilklow, Miltalie, Calkookra, Ben Buy and others.

• Metamorphic grade is important for flake size – weathered gneisses and marbles appear most prospective.

• Sugarloaf Exploration Target of 24-37Mt grading 10-12% C is contained within the western limb which is open along strike to the north. Deposit outcrops and averages 40m in true thickness. Graphite mostly fine averaging around 100µm. Exploration Target likely to increase with further exploration via strike extensions and the inclusion of the eastern limb.

• Petrology identified flake graphite at Campoona -Campoona South (avg 250-300µm), and Council Pit (avg 300µm). Historic exploration pre-Archer records large flake graphite at Calkookra and Wilklow. Other graphite bodies reported graphite in drilling but were not assayed or assessed.

• EM offers an excellent exploration tool.

• The limited drilling to date has been via RC hammer drilling which has led to breakage of graphite.

• Sugarloaf flotation tests in progress - first tests showing ≈ 50% C in first rougher concentrate indicating potential for >80%C concentrate following multiple cleaning stages.

Known Unknowns

• Metallurgical test work has commenced to determine the graphite products that can be produced. Samples from

• Sugarloaf, Campoona South, Campoona and Grid 2 being evaluated in overseas graphite facilities.

• There is a high likelihood that more graphite prospects will be discovered in this emerging “graphite province ”.

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Archer’s graphite projects are quickly taking shape

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What is Magnesite and Magnesia?

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Magnesium carbonate (MgCO3) was deposited as a chemical precipitate in shallow, marginal marine lagoons and mudflats, and occurs predominantly as cryptocrystalline particles 1–5 µm in size. 86 separate magnesite interbeds within the Skillogalee Dolomite have been recorded at Leigh Creek.

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Magnesia (MgO) is produced by heating magnesite typically above 1000[o] C. Magnesia occurs in three forms:

1. Caustic Calcined Magnesia (CCM) is formed by heating magnesite to temperatures up to 1,000[o] C. It is reactive and that reactivity is important for construction materials, industrial applications, in fertilizers and as a soil conditioning agent in agriculture, for water purification and waste water treatment and in the paper and rubber industries.

2. Deadburn magnesia (DBM) is produced by heating CCM to temperatures of 2,300[o] C to produce inert magnesia used for the production of refractory bricks.

3. Electrofused magnesia (EM) is produced by melting CCM to 2,800 - 3,000[o] C to produce crystalline magnesia used primarily in arduous steelmaking applications.

Magnesite / magnesia products are widely used across a number of high growth industries and widely used in high technology consumer goods

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Magnesia Market Growth

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MgO growth closely mirrors that of the steel industry

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MgO Refractory Bricks
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• Industrial applications - concrete

• Building products – Mg board

• Fertilizers and soil conditioners – strong local market

• Water purification

• Waste water treatment

• Acid mine water and acid tailings neutralisation

• Consumer electronics - Mobile phones, laptops,cameras, iPods, PDAs

• High tech alloys – AM-lite

• Magnesium batteries which hold twice the energy of lithium-ion cells likely to be used to power electric cars

• Liquid magnesium battery offers promising solar energy storage technique

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MgO Market grows at ≈330ktpa. 63% of market in refractories; 23% in chemicals and 14% into magnesium metal

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Archer’s Leigh Creek Magnesite Deposits

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Mt Playfair
Mt Hutton
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• High quality (>42% MgO)

• Consistent chemical composition over 80 kms strike

• $millions spent on BFS for Mg metal production

“World Class” is often self-bestowed but rarely deserved – Leigh Creek is an exception

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Leigh Creek 1999 JORC Resources

Area	Measured (Mt)*	Indicated (Mt)*	Inferred (Mt)*	MgO1
Mt Hutton	18.3	42	53	42.9%
Mt Playfair		11	23	42.5%
Pug Hill		10	10	42.7%
Termination Hill	4	5	20	42.8%
Witchelina	23.7	94	99	40.0%
Total	46	162	205

*Source: Reproduced from MDL Report “Economic Evaluation of the Pug Hill Magnesite Deposit, North Flinders Ranges, South Australia. 2001. Note full BFS completed and JORC resources for 5 deposits and JORC reserve for Mt Hutton calculated. The independent resource estimates were completed by Mr. Colin Arthur (BSc, MSc, FGS, MAusIMM, CGeol, CEng) Manager, Micromine Resource Centre, August 1999. The estimates were based on 69 fully cored DDHs and all other attendant studies required to support resource and reserve estimation.

1 Pure magnesite is 47.8% MgO

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413Mt JORC Measured, Indicated and Inferred Resource

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Magnesite / Magnesia Business Model Crushing Plant
Mine
ROM MgCO3
Crushed MgCO3
Flotation? &
Rail to Spencer Gulf
Calcination Crushed MgCO3
Caustic Calcined (>$600/t)
DSO magnesite
Steadily Growing
Market
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Focus is on producing either DSO magnesite or high value intermediate products

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Leigh Creek Development Options

Key Attributes

• High grade magnesite deposits

• Huge JORC Resource can support large scale operation for

• many hundreds of years

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• Low capital entry

• Good supply chain logistics

• Proximal to Leigh Creek

Funding Options

Archer has 100% ownership of the magnesite deposits on Termination Hill and Witchelina ELs.

Will consider joint venture options to co-develop the deposits.

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Leigh Creek magnesite supply chain logistics
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100% ownership affords Archer flexibility in project development

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Leigh Creek Magnesite

Calcining Test Work

• Calcining tests to 1000[o] C on run-of-mine magnesite produced magnesia grading: > 92% MgO

≈ 4.5% SiO2

≈ 0.3% Al2O3 ≈ 0.6% CaO ≈ 0.4% Fe O 2 3

• To maximise the marketability of magnesia produced the SiO2 level needs to be reduced to ≤3.0% (ideally ≤1.5%) and the magnesia (MgO) increased to ≥95% MgO.

• Talc - hydrated magnesium silicate H2Mg3(SiO3)4 or Mg3Si4O10(OH)2 accounts for much of the SiO . 2

• Further test work being undertaken to determine the optimum process flow sheet.

• Latest flotation tests have reduced pre-calcination SiO2 levels to 1.9% which would translate into a ≈3.6% SiO2 CCM product.

Archer does not underestimate the barriers to entry that exist for new entrants into the extremely competitive magnesia “industrial minerals” market. However, the Company believes that the comparatively modest expenditure needed to attempt to identify the optimum process flow sheet is well worth the risk. Archer is confident that, should this be achievable, considerable value would be unlocked through the ownership of such World Class magnesite resources.

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Further test work being scoped to increase product capability

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West Roxby Project - Uranium (Apollo) & IOCG (Island Lagoon and Evelyn Dam)

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Residual Gravity and Magnetic
image with Cariewerloo Basin
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Substantial exploration targets now a step closer to evaluation

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Olympic Dam Province - Apollo Target

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Apollo Gravity Apollo Magnetics 8mgal low

Apollo Topography 20-30m topographic low

Deposit style : Rabbit Lake Uranium Mine Nth Saskatchewan Canada

Discovered 1965 First Production 1975 2008 Production CAMECO 3.6m pounds

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Apollo has compelling exploration vectors

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West Roxby – Apollo Unconformity Uranium Target Model

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Athabasca Style

Magnetic and Gravity Lows Surface Depression – Rabbit Lake Pandurra redbed lithologies

Unconformity

Reduced crystalline basement intruded by A type granites. (Olympic Dam)

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NTMA signed by main Claimant representatives. Planning for site Clearance Survey Q1 2012.

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Archer Manganese

Ketchowla – DSO quality manganese

• 5 main manganese deposits with ≈28kms strike potential.

• Medium grade (≈ 20% Mn Ni, Co, Cu & Zn, REE).

• Dense media separation and gravity concentration upgraded K1 drill cuttings from 17.47% Mn to ≈38% Mn at

• a 23% recovery. Ni, Co, Cu, Zn and Y also upgraded:

• Ni (0.258% to 0.412%);

• Co (0.175% to 0.296%);

• Cu (0.226% to 0.377%);

• Zn (0.164% to 0.277%);

• Yttrium 113.2ppm to 204ppm.

• 90% – 95% recovery of Mn, Ni, Co, Cu & Zn in

• agitated acid leach tests.

• Peak assays of 0.47% REE (from rock chip samples) and

• 0.36% REE in drill cuttings at K1, K2, K3 and K9 deposits.

• Elevated REEs at K9 not related to manganese and occur within a weathered intrusive?

• Manganese deposits open at depth and along strike.

• Recently completed ground gravity survey has identified drill targets extending under surficial cover.

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Ketchowla one of several Archer manganese projects

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Archer Manganese

Salt Creek manganese

• Drilling highlighted that manganese occurs in three different rock units:

• High iron manganese associated with banded iron formation.

• Fine manganese in weathered pelitic sediments (clays & schists).

• 5mm fine manganese nodules within transported silica-rich sand.

• The manganese units comprise two limbs of an overturned syncline with a western limb consisting of outcrops of high-iron manganese and an eastern limb of manganese and silica-rich manganese adjacent to quartzite/leached BIF.

• +0.5mm grades 20-25% MnO with recoveries to 30%.

• Strike length consists of 4kms (confirmed) and up to 10kms based on regional historic sampling.

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A plan view of the trace of the fold structures, with regional rock chip results

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Salt Creek – significant undrilled resource potential

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Thank You

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If you would like additional information please contact:

Gerard Anderson Managing Director Archer Exploration Limited ganderson@archerexploration.com.au

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