ARCHER MATERIALS LIMITED - Annual Report 2013

Archer Exploration Limited Annual Report 2013

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Contents
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	Highlights and Achievements	1
	Letter from Chairman Review of Projects Tenement map. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Archer’s Graphite: the big picture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Archer’s Graphite Projects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Magnesite . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Copper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manganese . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Nickel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Industrial minerals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Coal ± Gasif cation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Director’s Report Auditor’s Independence Declaration	5 8 9 10 28 32 34 41 45 46 48 50 59
	Corporate Goverance Statement	61
	Financial Information	64
	Directors’ Declaration	91
	Independent Audit Report	92
	Additional Information	95
	Corporate Directory	97

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Competent persons statement
Forward looking statements
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Highlights and Achievements
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Archer made substantial progress in the evaluation of the 100% owned Campoona graphite deposit during 2013. Exploration and development activities included exploration drilling, estimation of a Maiden JORC Resource, rigorous metallurgical bench-scale test work and a detailed market assessment for the graphite products.

Archer’s ultra-pure natural graphite has the potential to out-perform synthetic graphite.

Resource drilling was completed at the Campoona Shaft graphite deposit with RC drilling on a 50m x 20m grid spacing supported by six (6) diamond drill holes. Resource drilling at Central Campoona, situated 2kms southwest of Campoona Shaft, was also completed on a 50m x 20m grid spacing, however no diamond drilling was undertaken. The Phase 1 Maiden JORC Resource is shown below.

Campoona: Maiden JORC Resource (2%TGC)

	*Project* *Resource* *Tonnes* *Graphite* *Contained* *Category* *(Mt)* *(Mt)* *(tonnes)*
	Campoona Shaft Measured 0.339 14.8 50,200 Indicated 1.059 12.7 134,500 Inferred 3.475 5.0 173,800 Central Campoona Inferred 0.397 10.1 40,100 Total 5.270 7.6 398,600*

Table 1: Campoona JORC Resource - 2%TGC (Total Graphitic Carbon) lower cut-off grade.

Campoona: Maiden JORC Resource (5%TGC)

	*Project* *Resource* *Tonnes* *Graphite* *Contained* *Category* *(Mt)* *(Mt)* *(tonnes)*
	Campoona Shaft Measured 0.339 14.8 50,200 Indicated 1.056 12.7 134,100 Inferred 0.837 10.7 89,600 Central Campoona Inferred 0.295 12.5 36,900 Total 2.527 12.3 310,800*

Table 2: Campoona JORC Resource - 5%TGC (Total Graphitic Carbon) lower cut-off grade.

* Central Campoona

Resource estimation is

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confi ned to 200m of known strike of 1,400m.

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Highlights and Achievements
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Estimation of a Phase 2 combined JORC Resource for Campoona Shaft and Central Campoona will be completed in September 2013.

Regional exploration in the Cleve area identifi ed three further bodies of highly graphitic schist similar to the graphite deposits at Campoona Shaft and Central Campoona. These bodies are thought to be faulted offsets and possibly fold repetitions of the same geologic horizon.

Archer’s plan has been to produce graphite concentrates that match the world’s highest quality natural graphite concentrates.

No further Resource drilling is planned for the greater Campoona graphite deposits as the Maiden Phase 1 JORC Resource alone could support a long-life mining operation.

Since October 2012 the Company has undertaken rigorous metallurgical bench-scale testing of representative diamond drill core samples of Campoona graphite. From that testing the Company has gained invaluable knowledge on optimising the fl otation of graphite and on the suppression and removal of gangue minerals. A total of 35 fl otation tests were completed for samples across the length, breadth and depth of the Campoona Shaft deposit.

From the outset Archer’s plan has been to produce graphite concentrates that match the world’s highest quality natural graphite concentrates. Several successive tests delivered -75 micron graphite concentrates grading 96% - ≥99% carbon.

Archer engaged the services of Tech Minerals Consulting Group which includes senior global industrial minerals experts who have worked extensively with major graphite suppliers and purchasers to assess the results and make comment on the likely markets and prices for such concentrates.

Tech Minerals Consulting Group reported that ‘the mechanical cell fl otation results presented by Archer Exploration have been assessed by the Tech Minerals Consulting Group and they consider the results largely unheard of in the natural fl ake graphite arena with the exception of vein graphite.’

Tech Minerals Consulting Group further advised that ‘…if Archer is capable of replicating these results consistently, then the company will have a unique product in the natural graphite space’. In assessing the potential markets for this graphite Tech Minerals Consulting Group stated that ‘such a product, properly introduced, is likely to be highly sought after by specialist manufacturers and end-users to include battery, polymers, ceramics, and high tech lubricants’.

Tech Minerals Consulting Group stated that ‘prices for fl ake graphite of 99.0% and higher in particle size ranges from 5 micron to -100 Mesh will command between A$2,500 to A$5,000 per metric tonne’.

Archer’s aim is to produce a range of graphite products all in the high grade to ultra-pure grade ranges required by several high tech industry sectors.

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Highlights and Achievements
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Simple metallurgical processing means that Campoona graphite can be prepared from mechanical fl oat cells typically at ≥97% carbon (TGA) with limited benefi ciation to deliver in excess of 99% carbon.

The campaign of metallurgical bench fl otation trials demonstrates that the combination of a high-performing, ultrafi ne graphite fl otation followed by acid treatment to remove trace contaminants is able to produce a graphite concentrate product that reports in the 99+% range. Such purities are exceptional in the natural graphite industry.

Synthetic graphite is expensive to produce and typically trades at prices greater than US$7,000/t.

The results achieved show that Archer can focus on the production of ultra-pure graphite that may rival synthetic graphite in purity but is likely to out-perform synthetic graphite due to its crystallinity. Synthetic graphite is expensive to produce and typically trades at prices greater than US$7,000/t.

Campoona can deliver very high quality natural graphite powders from a low cost, high yielding extractive process. As such Campoona is a very rare project indeed. This means Archer is very likely to enter the higher value end of the graphite market where unit margins are likely to give the project robustness in almost any price regime.

The Company’s Campoona and Sugarloaf graphite deposits occur on freehold private land. The most favourable outcome for the Company is to own the land needed for mining and processing as ownership provides maximum fl exibility for the proposed operations. Land in the Cleve area is tightly held and rarely changes hands. Fortuitously a large parcel of land covering the bulk of the Company’s Sugarloaf Graphite deposit was put up for sale. Archer acquired 1,403 acres of land known as the Sugarloaf Property that hosts most of the Company’s Sugarloaf graphite deposit that has an Exploration Target* of 37-70Mt grading 10-12% C.

Campoona and Sugarloaf In addition to the Sugarloaf Property purchase, the Company signed a graphite deposits occur on Heads of Agreement on 1 July 2013 covering the purchase of 120 acres of freehold private land. land at Campoona Shaft. Final payment for the Campoona Shaft Land will occur on subdivision of the land.

Archer now has the land needed to commence mining and mineral processing of the Campoona Shaft and Sugarloaf deposits.

In preparation for a future Mine Lease Proposal planned for mid-2014, the Company completed Spring baseline ecological surveys over the Campoona area.

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* 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.

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Highlights and Achievements
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The Company engaged the services of magnesite/magnesia experts to assist with the completion of an Information Memorandum covering the Company’s Leigh Creek Magnesite Deposits. As at 1 July 2013, the Information Memorandum was substantially completed. Completion has been delayed pending the outcome of a dispute relating to the ownership of the Mt Hutton portion of the greater Leigh Creek deposits. Archer’s Leigh Creek magnesite deposits are by far the World’s largest cryptocrystalline magnesite deposits with JORC Resources of 453Mt grading 41.4% MgO. The plan once the dispute is resolved is to put the asset up for sale.

Archer’s Leigh Creek magnesite deposits are by far the World’s largest cryptocrystalline magnesite deposits.

During 2013 the Company also completed short exploration programmes at the Epithermal gold prospect on Wildhorse Plain, at the Salt Creek manganese prospect and at the Robertstown copper prospect.

Detailed mapping at the Epithermal gold prospect at Wildhorse Plain has identifi ed a > 6km zone of epithermal alteration (potassic + argillic alteration accompanied by fl uorite + amethyst + free gold + antinomy). Mapping also identifi ed two areas of extensive brecciation and silicifi cation that carry widespread anomalous gold. A rock chip sample sent for petrological examination recorded free gold associated with antinomy.

The widespread alteration geochemistry suggests the Epithermal prospect to be a low sulphidation hydrothermal (epithermal) alteration system. The area of known alteration is very large (>6 kms) and is perhaps much larger as it is seen to extend under cover. Enriched gold tenor was demonstrated in 2012 when drilling recorded a 29m intercept grading 0.57g/t Au.

Low sulphidation epithermal alteration systems often record strong vertical mineral zonation and can host bonanza grade gold veins. In such systems gold is often concentrated through a combination of ground preparation (permeability) and rheological contrast.

A limited drilling campaign at Robertstown returned low grade copper anomalism. The results, whilst low grade, were encouraging

The Company is in a very strong fi nancial position and capable of fully funding a PEPR/Mining Lease Proposal …

A short drilling programme at Salt Creek tested the theory that enriched manganese might occur within a plunging synclinal keel located west of the main manganese body. No economic manganese was intersected.

With $8.56 million in cash at 30 June 2013, the Company is in a very strong fi nancial position and capable of fully funding a PEPR/Mining Lease Proposal for Campoona during 2014.

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Letter from Chairman
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Greg English Chairman

Dear Shareholder,

It is with a sense of both satisfaction and great anticipation that I present Archer’s 2013 Annual Report and my Chairman’s Letter.

Despite a terrible year for junior explorers on the Australian share markets, Archer has enjoyed much success during the year. Our achievements are matched by the opportunities with which we are now presented as we move ahead with development of the Campoona Graphite Project and continue what is shaping up as Australia’s and one of the World’s high grade graphite projects.

Archer’s initial Campoona drill program commenced in October 2011 at Central Campoona and by the fi rst quarter of 2012 the Company had announced a signifi cant discovery at Campoona Shaft. We have since delineated a total strike length of 3km and 300,000 tonnes of contained carbon which is suffi cient to sustain a plus 15 year mine life. This resource has been the subject of a Scoping Study, which the Company expects to release to ASX in late 2013 or early 2014, aimed at enabling Archer to join the ranks of graphite producer over the next 2 to 3 years.

The scope and economic potential of the Campoona Project will take more precise shape as we fi nalise metallurgical test work and undertake feasibility studies. However, initial indications are that the current resources will support an open pit mining operation with the capacity to produce up to 10,000 tonnes per annum of high purity graphite over a mine life of 15+ years. At current graphite prices, that should yield signifi cant value for shareholders.

From a standing start, we have delineated a substantial inventory of high-grade graphite resources at Campoona Shaft in a little over 15 months and have purchased all of the land required for the Campoona Shaft mining operations and the Sugarloaf graphite processing facility. This is a remarkable result. A full outline of the more detailed aspects of the Campoona Project is contained elsewhere in this report. However, I would like to take this opportunity to assure you that the Company’s Directors are committed to realising the full potential of the Campoona Project and of our broader +1,000km2 land-holding in this region.

We have explored only a select part of our tenements. Our current search is focused on the highly prospective Campoona Shaft and Campoona Central areas and depth extensions to both of these deposits. We will also increasingly turn our attention elsewhere within our tenement holding and to the Sugarloaf Project where we have identifi ed a large exploration target.

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Letter from Chairman
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The Company remains well-funded with cash of approximately $8 million at the time of writing this report, thanks to a well-timed sale of the West Roxby Tenements in early 2012 and careful and prudent managements of the Company’s funds. Moving forward, we have many funding options available to us, both to continue our exploration and resource development programs, and to develop a world-class mining operation at Campoona.

The Company’s ability to drive the Campoona Project forward was recently strengthened with the extension of our Managing Director’s employment for a further 3 years. Archer is well advanced when compared to our peers and our achievements in understanding the metallurgy of the graphite and our ability to constantly recover a pure grade graphite product has been remarkable.

In conclusion, I would like to take this opportunity to thank my fellow Directors and to also thank shareholders who have supported the Company. I would also like to express my thanks to the many people within the broader Archer organisation who have worked to deliver this fantastic result and propel the Company toward the development of the Campoona Project.

I have no doubt our Company is well positioned to build on the solid foundations laid over the past year and to move forward with great strength and confi dence.

I wish you all the best for the year and look forward to updating you on our progress.

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Greg English Chairman

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Review of Projects

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Archer’s tenements

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Exploration Licence (EL) Leigh Creek South Australia
Magnesite Project
Licence Application (ELA)
Port Augusta
JV with UraniumSA (EL)
Olympic Dam Mine
Hignways & major roads
Leigh Creek
Railways Ediacara
0 50 100km
Carrapateena Prospect
Port Augusta
Spring Creek
Whyalla
Napoleon’s Hat
Carappee Hill Mt Messenger Port Pirie North Burra
Cleve West North Cowell Burra
Wildhorse Plain
Worlds End
Port Lincoln Australia Plains
Adelaide
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REVIEW OF PROJECTS

Archer’s Graphite: the big picture

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Graphite presents a signifi cant opportunity for Archer and the Company has made excellent progress in the evaluation of the Campoona Graphite Deposit during 2013.

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Graphite due to its rarity, its unique physical and chemical properties and its growing importance in high technology applications and green energy initiatives has been declared a strategic mineral by both the USA and the European Union.

Gerard Anderson Managing Director

The strategic mineral status also acknowledges the dominance of China in having huge reserves and substantial production capacity. China produces around 80 per of the world’s graphite. Chinese graphite is declining in quality as easily mined surface oxide deposits are being depleted. Costs of production are increasing as mines become deeper. Costs are also under considerable pressure from tightening labor and environmental standards. Many Chinese graphite mines are small and operate seasonally. During 2013 reports stated that up to 200 graphite mines were closed in the Hunan Province in favour of a small number of higher output mines. Commentators have attributed the closures to a combination of environmental, resource preservation and output control measures. China has a 20% export duty on graphite, as well as a 17% VAT, and has instituted an export licensing system to ensure supply to its domestic economy including its steel industry which internally consumes a great deal of graphite.

No mineral is so versatile and with such unique and important physical and chemical properties.

China’s dominance in graphite and its ability to restrict or advance output has created supply concerns for the rest of the world.

The USA has no crystalline fl ake graphite production. Several potential mines in Canada have been in the planning stages in some cases for many years and production capacity still appears some way off.

Recent graphite exploration in Africa has identifi ed some large fl ake deposits that are in the formative stages of exploration. Such projects have the potential to supply graphite in the medium-term.

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

China’s dominance in graphite and its ability to restrict or advance output has created supply concerns.

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REVIEW OF PROJECTS

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Archer’s Graphite Projects

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The principal area of focus is the Cleve upland which is located on the Eyre Peninsula, South Australia. Archer has three tenements (EL4861 Carappee Hill and EL4893 Cleve West) and has earned the right to 100% of all minerals other than uranium on EL4693 Wildhorse Plain. The tenement package covers 1,100km[2] of highly prospective ground with several known occurrences of graphite. In the past year an additional tenement application was made for ELA 304/2012 (Mt Messenger).

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Railway W hyall a
South Australia
Kimba
Major road
Cowell
Cleve
Wallaroo
Port Spencer
(development)
Port Lincoln
0 25 50km
Power line
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Carappee Hill
EL 4861
Sugarloaf
North Pindari
Mt Messenger
ELA 304/2012
Sugarloaf
Campoona North
Graphite reported
in drill hole
Campoona Shaft
Wilklow
Campoona Central Wildhorse Plain
A403 EL 4693
Grid 2
Campoona South Council pits: Graphite in benches North Cow ell
Cleve West EL 4277
EL 4893
Grid 4 Mt Shannon Yalpoudnie
North Cowell
EL 4277
Cowell
Cleve
0 5 10 Km
Figure 1: Archer’s graphite prospects and tenements
Drilled graphite targets AXE Licence (EL)
Un-tested graphite targets AXE Joint Venture (EL)
Town AXE Licence Application (ELA)
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The Campoona Region

Over 6,000m were drilled in the period for graphite on the Campoona trend and local regional targets (Table 1).

Signifi cant advancement was made in the year with:

Maiden JORC Resource for the Campoona Shaft and Central Campoona and the completion of infi ll resource drilling at Central Campoona.

The tenements cover 1,100km[2] of highly prospective ground.

Perfecting graphitic fl otation and recovery to produce high-grade to ultra-pure concentrates.

	*Location* *Number of* *Method* *Number of* *holes* *metres drilled*
	Campoona Shaft 6 Diamond 516.9 Campoona Central 42 RC 2004 Graphite Regional 59 RC 3656

Table 1: Breakdown of metres drilled for graphite in 2013 reporting period.

Campoona

The Campoona graphite deposit is located approximately 12km north of the township of Cleve on Eyre Peninsula, South Australia (Figure 2).

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Campoona Shaft
resource drilling
Campoona Central
resource drilling
0 1 2km
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Upper claystone exposed in sump excavated for diamond drilling.

Figure 2: Location of all drilling at Campoona

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Campoona Shaft - 2013 Drilling

Six diamond holes were drilled to recover graphite ore for metallurgical test work. Table 2 presents a summary of the main graphitic intervals.

	Campoona Shaft Drilling: Carbon assay results from metallurgical Diamond drilling.
	*Hole ID* *From* To *Interval* *Assay* *Lithology* *(m)* *(m)* *(m)* *%TGC*
	CSDD12_001 16 47 31 14.7 Graphitic schist CSDD12_002 11 88 77 17.2 Graphitic schist CSDD12_003 24 106.4 82.4 15.9 Graphitic schist 24 89 65 14.7 to EOH 90 106.4 16.4 21.3 CSDD12_004 17 115 98 13.3 CSDD12_005 28 74 46 12.6 Graphitic schist 32 51 19 16.1 & gneiss 59 73 14 14.8

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Table 2: Carbon assay results from metallurgical diamond drilling at Campoona Shaft

The metallurgical diamond holes were located spatially along the deposit so that the ore body could be tested along its entire strike and vertically throughout the profi le. Figure 3 below shows the location of the diamond holes in relation to the other resource holes drilled with

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Diamond Holes drilled
RC holes drilled
2013 RC holes drilled
S urface projection of total orebody
0 100 200m
CS DD12_001
CS DD12_002
CS DD12_003
CS DD12_004
CS DD12_005
CS DD12_006
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Figure 3: Location of drill holes at the Shaft area with a surface projection of the ore body.

conventional Reverse Circulation (RC) methods.

Due to the softness of the graphitic ore the diamond holes were all drilled with a method known as ‘triple tube’ which permits the recovered core to be extracted from the core barrel intact.

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Triple tube cores from CSDD12_002.

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The fi gures 4 – 8 show each of the diamond holes in their corresponding section where the relationship to the RC holes can be seen to be very consistent. The steep dip on some of the holes permitted long graphitic intervals to be drilled maximising the volume of material recovered and providing greater representation of the weathering profi le.

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CS DD12_001 is
located 25m off
of s ection
TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 25 50m
CS R C12_047CS R C12_040CS DD12_001
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Figure 4: Section CSDD12_001

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TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 30 60m
CS R C 12_041CS R C 12_010 CS DD12_003 CS R C 12_009CS R C 12_008
38m@ 8.79%C
73m@ 9.33%C
48m@ 12.48%C
67m@ 11.36%C
88m@ 15.08%C
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Figure 6: Section CSDD12_003

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TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 25 50m
Figure 5: Section CSDD12_002
TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 20 40m
CS R C12_058CS R C12_048CSDD12_002
CS R C12_049
CS R C 12_012CS R C 12_011
CS R C 12_042CS R C 12_013CS DD12_004
Amphibolite Intrus ive
----- End of picture text -----

Figure 7: Section CSDD12_004

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TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15% 0 25 50
CS R C 12_062
CS R C 12-053
CS R C 12_061
CS R C 12_052CS DD12_005
----- End of picture text -----

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Figure 8: Section CSDD12_005

Central Campoona - 2013 Drilling

A programme of 50m x 20m spaced RC drilling was completed over most of Central Campoona during 2013. A total of 42 holes for 2004 metres were drilled with RC. The most signifi cant results from the drilling are presented in Table 3.

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2012 drill holes
2013 drill holes
S urface projection of
graphite orebody
0 200 400m
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Figure 9: Locations of holes drilled at Central Campoona.

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Drilling at Central Campoona.

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Central Campoona Drilling: Carbon assay results from metallurgical RC drilling.

	Hole ID Depth from Depth To Interval %TGC (m) (m) (m)
	CSRC13_001 42 52 10 8.3 CSRC13_002 19 53 34 10.7 CSRC13_003 24 50 25 12.6 CSRC13_004 48 66 17 17.4 CSRC13_006 28 39 11 12.4 CSRC13_007 53 61 7 4.0 CSRC13_013 10 31 21 3.5 CSRC13_014 24 31 7 7.1 CSRC13_017 22 29 7 5.5 CSRC13_018 62 72 10 3.7 CSRC13_020 0 10 10 2.5 CSRC13_024 9 24 15 13.3 CSRC13_025 27 43 16 15.2 CSRC13_026 12 37 25 12.8 CSRC13_027 15 23 8 10.3 CSRC13_029 10 21 11 8.0 CSRC13_0301 0 52 52 13.6 CSRC13_031 13 15 2 7.7 CSRC13_032 18 42 24 16.4 CSRC13_033 4 10 6 8.4 CSRC13_039 3 8 5 8.5 CSRC13_0422 41 55 14 19.2

Hole ID
Depth from
Depth To
Interval
%TGC
(m)
(m)
(m)

CSRC13_001
42
52
10
8.3
CSRC13_002
19
53
34
10.7
CSRC13_003
24
50
25
12.6
CSRC13_004
48
66
17
17.4
CSRC13_006
28
39
11
12.4
CSRC13_007
53
61
7
4.0
CSRC13_013
10
31
21
3.5
CSRC13_014
24
31
7
7.1
CSRC13_017
22
29
7
5.5
CSRC13_018
62
72
10
3.7
CSRC13_020
0
10
10
2.5
CSRC13_024
9
24
15
13.3
CSRC13_025
27
43
16
15.2
CSRC13_026
12
37
25
12.8
CSRC13_027
15
23
8
10.3
CSRC13_029
10
21
11
8.0
CSRC13_0301
0
52
52
13.6
CSRC13_031
13
15
2
7.7
CSRC13_032
18
42
24
16.4
CSRC13_033
4
10
6
8.4
CSRC13_039
3
8
5
8.5
CSRC13_0422
41
55
14
19.2

Table 3: Signifi cant intervals from 2013 drilling at Central Campoona.

1 CSRC13_030 was drilled down the dip of the graphite to collect metallurgical samples representing the weathering changes of the orebody.

2 CSRC13_042 ended in mineralisation.

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TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 15 30m
0.48
0.29
0.22
0.19
0.07
0.24
4.57
2.16
0.59
0.71
4.34
6.74
5.32
0.52
0.26
0.16
0.30.38
0.77
0.88
0.77
0.41
0.28
0.40.36
0.35
0.34
0.27
0.24
0.40.39
0.49
0.78
0.22
2.38
22.5
22.9
18.2
19.9
18.318.45
16.418.85
19.05
21.3
20.8
18.4
14.5
0.590.590.590.430.430.430.431.241.241.241.2416.521.519.5519.2516.2517.814.18.6113.2515.415.66.0714.1518.418.2516.5511.0514.916.33.963.594.667.712.493.63 0.450.450.450.450.280.280.280.280.250.250.250.250.260.260.260.260.380.380.380.380.360.360.360.360.20.20.20.20.70.70.7
CS R C13_042CS R C13_026 CS R C13_022
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Figure 10: Most Northern Line (L1)

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TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 10 20m
CS R C13_025 CS R C13_024 CS R C13_023
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Figure 12: (L3)

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TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 15 30m
Figure 11: (L2)
TGC >1% and <5%
TGC >5% and <10%
TGC >10% and <15%
TGC >15%
0 20 40m
CS R C13_002 CS R C12_028CS R C13_030 CS R C12_027 CS R C12_026
CS R C13_005 CS R C13_004 CS R C13_003CS R C13_029
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Figure 13: (L5)

It is anticipated that a Phase 2 Resource estimate will be completed in Q3-Q4 of 2013. The Phase 2 Resource will be used for mining studies with a view to reporting the fi rst Reserve for Campoona.

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Campoona Geology

At Campoona the graphite occurs as highly graphitic schist within a low grade graphitic protogneiss. The original sediments were clastic psammitic and pelitic marine sediments and are of Palaeoproterozoic age. Diagenesis and metamorphism to upper amphibolites facies has converted carbon present in the sediments to crystalline graphite.

The Campoona Shaft deposit consists of a main northeast striking, steep northwest dipping 20m - 50m thick main highly graphitic schist with narrower discontinuous graphitic horizons footwall to the main graphitic schist.

In outcrop the immediate footwall to the Campoona graphite deposits is marked by a 2m wide hematite-rich horizon. This hematite horizon is probably related to the oxidation of sulphides rather than being described as a banded iron formation.

The primary mineralogy of the highly graphitic schist is quartz + graphite + feldspar + muscovite + garnet + tourmaline + cordierite + sillimanite. Pegmatite sills and dykes occur within the sequence. Conformable and cross cutting late-stage amphibolite dykes intrude the sequence.

The graphitic host rocks have been subjected to intense weathering. The base of complete oxidation occurs at a vertical depth of 60m - 70m with strong oxidation persisting to the depth of drilling – approximately 100m.

The graphite at Campoona Shaft subcrops or lies beneath a thin veneer (<2m) of soil cover. The uppermost 5m of the

graphite occurs as kaolinite + quartz + graphite + garnet + tourmaline + muscovite. This horizon has been named the Upper Claystone.

Below the Upper Claystone the graphitic schist occurs as highly weathered, porous quartz + graphite + kaolin + garnet + tourmaline ± iron oxides (goethite & hematite) rock. All feldspar has been converted to kaolin with most of the kaolin removed by percolating meteroric water. Quartz occurs as disaggregated often rounded free grains. Discrete thin clay-rich zones occur more as cavity fi ll than discrete horizons. This horizon has been termed the Upper BOCO (where BOCO is an acronym for Base of Complete Oxidation).

Below 60m – 70m vertical depth the graphitic schist becomes more competent although strong weathering persists to at least 100m depth. Feldspars have been converted to illite ± kaolin ± smectite. Sulphides in the form of pyrite occur irregularly in trace quantities.

Both Central Campoona and Campoona Shaft occur within a regional shear zone here termed the Campoona Shear. The Campoona Shear, which is up to 16km in length, hosts at least three additional known ‘pods’ of highly graphitic schist with characteristics similar to Campoona Shaft and Central Campoona. Late stage NW trending cross faulting often with attendant amphibolites intrusives has segmented the graphite pods.

Campoona Shaft Schematic Long Section

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NORTH SOUTH
Complete Clay
Alteration Graphite Schist
0 100 Gniess and Chlorite rich
Deposit open at depth beyond 120m of surface Schist cross cutting
metres Amphibolite
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Figure 14: Schematic long section of Campoona Shaft showing main geologic horizons based on the degree of weathering of the host rock unit.

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Central Campoona occurs as a regularly steep dipping almost tabular body that varies in thickness from 10 -15m. Campoona Shaft on the other hand varies from 10 – 40m in true thickness due to pinching and swelling along strike and down dip within the shear. Rafts of low grade (<5%TGC) graphitic gneiss occur within the shear.

form crystal aggregates. Flake size and crystallinity of the graphite are by-products of metamorphism. The presence of sillimanite indicates high metamorphic temperatures but graphite crystal size points to likely variable pressures.

Prolonged weathering of the host units has lead to strong natural liberation of the graphite from the gangue minerals.

The graphite at Campoona varies in crystal size from 30300µm and averages around 150µm. The average fl ake size is classifi ed as fi ne and medium fl ake. The fl akes generally

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Schematic Geology of Campoona
Campoona Shaft
Known Graphite at
surface
Suspected Graphite
Campoona Central from EM (to be tested)
iron rich units indicating
shear zones
Faults
Chlorite Amphibolite
Gniess & Pegmatite
Schist & Minor Gniess
Banded iron formation
Campoona South Dolomite
0 2 4 km
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Figure 15: Schematic interpretation of the geology for Campoona

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Campoona JORC Resource

A Maiden Phase 1 JORC Resource estimate was conducted by MiningPlus, an independent expert resource consultancy with offi ces in Australia, Canada and South America. Information used in the Resource estimate included fi ve (5) diamond drill holes and thirty seven (37) Reverse Circulation (RC) drill holes. The JORC Resource for Campoona is shown in Tables below.

	Campoona: Maiden JORC Resource (2%TGC)
	*Project* *Resource* *Tonnes* *Graphite* *Contained* *Category* *(Mt)* *(Mt)* *(tonnes)*
	Campoona Shaft Measured 0.339 14.8 50,200 Indicated 1.059 12.7 134,500 Inferred 3.475 5.0 173,800 Central Campoona Inferred 0.397 10.1 40,100 Total 5.270 7.6 398,600*

Table 4: Campoona JORC Resource - 2%TGC (Total Graphitic Carbon) lower cut-off grade.

	Campoona: Maiden JORC Resource (5%TGC)
	*Project* *Resource* *Tonnes* *Graphite* *Contained* *Category* *(Mt)* *(Mt)* *(tonnes)*
	Campoona Shaft Measured 0.339 14.8 50,200 Indicated 1.056 12.7 134,100 Inferred 0.837 10.7 89,600 Central Campoona Inferred 0.295 12.5 36,900 Total 2.527 12.3 310,800*

*Central Campoona Resource estimation is confined to 200m of known strike of 1,400m

Table 5: Campoona JORC Resource - 5%TGC (Total Graphitic Carbon) lower cut-off grade.

The Phase 1 JORC Resource Central Campoona, located just 2km south of Campoona Shaft, was drilled on a 200m spacing with on-section drill spacings from 20-40m. Central Campoona has a known strike of 1,400m. Drill density over a length of 200m of the known strike was deemed suffi cient to support an Inferred Resource of 0.295Mt grading 12.5%TGC.

A second programme of resource drilling at Central Campoona was completed in February 2013 and resulted in a 50m x 20m drill spacing. A Phase 2 JORC Resource is expected to be completed during September 2013.

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Campoona Metallurgy

Since October 2012 the Company has undertaken rigorous metallurgical bench-scale testing of representative samples of Campoona graphite. A total of 35 individual benchscale tests have been completed testing samples across the length, breadth and depth of the Campoona Shaft deposit. The bench-scale assessment testing of the Campoona Shaft ore body is now complete.

The testing was carried out on graphite ore provided by three diamond drill holes evenly spaced along the length of the elongate deposit and intersecting the full depth of the ore body down to approximately 120 metres depth. Quarter-core composites were assembled to represent two ore types, the Upper BOCO extending down to approximately 60 metres depth, and a lower zone of fresher graphitic schist (Lower BOCO) further extending down to 120 metres depth. In addition, samples from the Upper Claystone representing the uppermost kaolin-rich horizon of the deposit were taken from sumps dug for the metallurgical diamond drill holes. These samples provided a comprehensive representation of the ore for metallurgical testing.

Mechanical cell fl otation was selected as the most effective method for graphite extraction and concentration. This is a long-established technique widely used in the graphite industry providing a simple but robust processing method. Although a strict methodology was applied for ore processing in the bench-scale testing, variations in grinding methods for clay removal and for cell operation has allowed each ore type to be processed uniquely. The weathered nature of much of the ore (Upper Claystone and Upper BOCO) meant that primary ball mill grinding was minimal.

Campoona graphite ores host both large and medium sized fl ake. Staged wet-grinding released graphite fl ake however the percentages of market grade fl ake (94 – 97% C) were low. Much of the larger fl ake is primarily composed of fi ner fl akes of graphite held together by quartz as an intercalated veneer.

The testing showed that Campoona ores across all three geologic horizons delivered high quality ultrafi ne concentrate at -75µm sizing from simple mechanical cell fl otation to levels in excess of 99%C. Such grades for -75µm graphite are rare, if not unique, to the graphite industry. .

Figure 4 below summarises the metallurgical testing. All three geologic horizons give >95% – >99% C concentrates using only cell fl otation and all three horizons have overall recoveries >90%. Further improvements in grade and recovery are expected to give concentrates consistently into the realm of >98% – 799.5% C prior to fi nal cleaning.

Following bench-scale testing Archer moved to important bulk fl otation testing during July 2013 on larger ore samples. The bulk fl otation testing has delivered ultra pure concentrates grading 99.4% C. These results are considered as outstanding. Further grade improvements are expected once these concentrates are lightly acid cleaned and these results will be reported when they come to hand.

It is expected that during August/September several kilograms of >99% C concentrates will be produced which will then be introduced to specifi c market segments for their assessment. It is expected that the marketing efforts will result in pre-commitments from prospective buyers.

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Campoona Shaft metallurgy update for -75 m
Upper Clay Horizon 97% - >99%C concentrates t solely from mechanical cell flotation l
>90% Recovery
NORT H SOUTH
Upper BOCO
95% - 97%C
90% Recovery
Lower BOCO
96% - 97%C
90-95% Recovery
Complete Clay
Alteration Graphite Schist
0 100 Gniess and Chlorite rich
Deposit open at depth beyond 120m of surface Schist cross cutting
metres Amphibolite
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Figure 16: Summary of Campoona Bench-scale tests by geologic horizon.

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The fact that ultra pure 99.4% C concentrates can be produced solely by bulk mechanical cell fl otation is exceptionally rare by world standards. Achieving grades of >99% C at recoveries of around 90% solely using mechanical cell fl otation makes Campoona a truly unique graphite deposit.

It is usual when moving from bench-scale to bulk fl otation that there is a drop-off in performance both in terms of the grade of the concentrates and the recovery of graphite. This has not been the case with Campoona ores. The outstanding bulk fl otation results achieved highlights the exceptional natural liberation of Campoona graphite ores.

The metallurgical testing demonstrates that ultra pure fi ne graphite concentrates can be readily produced from the all three geologic horizons using traditional and simple processing methods. The same processing method (and equipment) applies to all zones in the ore body. The ore is easily crushed with early and low-cost liberation of graphite. Exceptionally high purity levels can be achieved for the graphite product – levels which come with higher market pricing.

The campaign of metallurgical bench fl otation trials demonstrates that the combination of a high-performing fi ne graphite fl otation. Simple acid treatment to remove trace contaminants can be reasonably expected to deliver graphite concentrates reporting >99.5% C and perhaps as high as 99.9%C.

At grades over 99% both LECO and TGA lack accuracy and formal reporting limits these values to +/-1%. Archer is continuing to develop an analytical technique for trace element contents that can properly refl ect the high purity of the fi ne graphite concentrates.

The testing points to a clear, low-risk, early-entry option producing high value graphite.

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Exceptionally pure bulk fl otation concentrates

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100 microns
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Morphology typical of the ultrafi ne highly crystalline graphite concentrate (-75 micron) showing very pure crystalline fi ne graphite fl ake. Such concentrate is easily reprocessed to remove trace contaminants to achieve grades >99%C.

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Campoona Graphite Marketing

From the outset Archer’s plan was to produce graphite concentrates that matched the world’s highest quality natural graphite concentrates. Rigorous testing has delivered -75 micron graphite concentrates consistently grading 97% - >99% C with graphite recoveries averaging 85 – 95% using just mechanical cell fl otation. Bulk fl otation has delivered concentrates grading to 99.4% C. Post recovery light acid treatment will likely lift grades into the 99.5% - 99.9% C range.

The Company can match the world’s highest quality fi ne natural graphite concentrates.

Tech Minerals Consulting Group further advised that ‘...if Archer is capable of replicating these results consistently, then ‘the company will have a unique product in the natural graphite space’. Archer’s rigorous bench-scale

and bulk fl otation testing has clearly demonstrated the reproducibility of results across the length, breadth and depth of the deposit.

In assessing the potential markets for this graphite Tech Minerals Consulting Group stated that ‘such a product, properly introduced, is likely to be highly sought after by specialist manufacturers and end-users to include battery, polymers, ceramics, and high tech lubricants’.

Tech Minerals Consulting Group stated that ‘prices for fl ake graphite of 99.0% and higher in particle size ranges from 5 micron to -100 Mesh will command between A$2,500 to A$5,000 per metric tonne’.

The results achieved show that Archer can focus on the production of ultra-pure graphite that is likely to rival synthetic graphite in purity as well as likely to out-perform synthetic graphite due to its far superior crystallinity. Synthetic graphite is expensive to produce and typically trades at prices greater than US$7,000/t.

Campoona can deliver very high quality natural graphite from a low cost, high yielding extractive process. As such Campoona is a very rare project indeed. This means Archer is very likely to enter the higher value end of the graphite market (see graph below) where unit margins are likely to give the project robustness in almost any price regime.

What sets Campoona apart from almost all other graphite deposits in the world is its ability to deliver ultra pure, high value, highly crystalline fi ne graphite using conventional

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Stylized Graphic Price (US$/t) Vs Grade Curve
----- End of picture text -----

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$35,000
$30,000
Price
$25,000
$20,000
$15,000
$10,000
$5000
80% 85% 90% 95% 98% 99% 99.5% 99.95%
Grade %TGC (Total Graphitic Carbon)
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Figure 17: Illustrates how the price goes up signifi cantly when the purity of the grade reaches +99%TGC.

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Land Acquistion

Archer purchased the Sugarloaf Property in May 2013. The property is located approximately 35km north of the township of Cleve and lies within the Company’s Carappee Hill tenement EL4861. EL4861 contains the Sugarloaf graphite deposit which has an identifi ed Exploration Target of 40-70Mt at 10-12%C*.

The Sugarloaf Property consists of 568 hectares (1,404.3 acres) of land with 503 hectares arable and used for winter cropping. The Company has leased the Property which will continue to operate as a cropping enterprise.

The acquisition of the landholding gives the Company fl exibility in conducting ongoing exploration and far greater fl exibility for the planned future mining operations.

In June 2013 Archer executed a legally binding Heads of Agreement which covers the sale and purchase of land at Campoona (“Campoona Property”) located approximately 15km north of the township of Cleve on South Australia’s Eyre Peninsula. The land comprising the Campoona Property is to be excised from the existing pastoral property and settlement of the sale and purchase will occur once the requisite government approvals are received for the sub-division of the land.

The Campoona Property which lies within Wildhorse Plain EL 4693 hosts the Company’s Campoona Shaft graphite deposit.

The Campoona Property consists of 120 acres of land (the approximate area purchased shown on Figure 8). The land acquired is suffi cient, based on the current resource, to accommodate the full mining of the Campoona Shaft graphite resource.

The acquisition of the Campoona and Sugarloaf Properties gives the Company all of the land needed to support the planned future mining and processing operations for the Campoona Shaft and Sugarloaf deposits. Both Campoona Shaft and Sugarloaf occur on freehold pastoral land. The simplest form of transaction given the freehold status is to own the land on which the future operations will be based. Ownership of the land will provide the Company with operational fl exibility as well as providing greater certainty in the upcoming government approvals process for the establishment of mine and processing operations.

The purchase of the two properties represents another step toward the Company’s plans to further develop its graphite projects on the Eyre Peninsula.

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Figure 18: The Sugarloaf Property.

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Figure 19: Location of Archer’s Campoona and Sugarloaf Graphite Deposits.

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Figure 20: Campoona land being purchased.

* The potential quantities and grades presented as the Exploration Target 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).

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Mining Lease Proposal and PEPR

Archer has initiated key activities as part of a Scoping Study to assess potential mine development options for the Campoona Project and commenced the project approvals process.

Baseline fl ora and fauna studies for the Campoona Graphite Project were completed by the independent expert consultancy Golder Associates Pty Ltd. These studies are an important element for any future Program for Environmental Protection and Rehabilitation (PEPR) as required by the Department of Manufacturing, Innovation, Trade, Resources and Energy (DMITRE) prior to the grant of a Mining Lease.

Desktop studies commenced in September 2012 and fi eld surveys completed during November 2012. The timing of the studies ensured data is collected during the Spring period.

Golder Associates was also appointed to manage all studies needed to support a Mining Lease Proposal and a Programme of Environmental Protection and Rehabilitation. The current schedule aims to have those documents to Government for approval in mid calendar 2014.

Campoona Regional 2103 Exploration

During late 2012 a large aerial electro-magnetic (EM) survey was commissioned by the Company to identify prospective areas within the Campoona trend for additional drilling in 2013. The EM data provided signatures for drill testing to the north of the Campoona Shaft and to the south of Campoona Central.

A total of 59 holes for 3,656m were completed to test regional EM signatures. The drilling successfully identifi ed three new graphitic schist horizons similar to the Campoona Shaft and Campoona Central deposits.

In addition to the high grade graphite intercepts, holes CSRC13_009; CSRC13_026; CSRC13_028; CSRC13_031; CSRC13_039; CSRC13_040 and CSRC13_041 (fi gures 22& 23, below) all reported graphite intervals of less than 5% TGC. All of these areas will require follow up to determine the potential for Campoona-style graphite mineralisation.

	*Hole ID* *Depth from Depth to Interval* *%TGC* *Host* *Location*
	*(m)* *(m)* *(m)*
	CWHPRC13_002 39 45 6 12.6 Graphitic schist Camp _south WHPRC13_003 0 6 6 7.8 Graphitic schist Camp _south WHPRC13_024 8 17 9 8.1 Graphitic schist Camp_east WHPRC13_032 30 38 8 10.9 Graphitic schist Camp_north

Table 6: Signifi cant Regional graphite intercepts

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0 5 10km
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Figure 21: EM image for area surveyed in 2012.

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----- Start of picture text -----

WHPR C13_002
WHPRC13_002
WHPR C13_003 WHPRC13_003
WHPRC13_024
WHPRC13_026 WHPR C13_024
WHPR C13_026
WHPR C13_028
WHPRC13_028
0 1 2km
WHPRC13_031
----- End of picture text -----

Figure 23: Campoona South drill holes with EM background.

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Graphite at the Council Pit.

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Council Pit close up.

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0 0.5 1km
WHPRC13_032
WHPRC13_040
WHPRC13_041
WHPRC13_012
----- End of picture text -----

Figure 24: Campoona North drill holes with EM background.

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Diamond drilling at Sugarloaf Hill.

Sugarloaf Deposit

In 2008 graphite was reported by Archer in the regional drilling of EL 3711. A number of drill intervals were assayed to identify economic intervals of graphite. Values of up to

Following this, in 2010 the fl ake graphite was identifi ed through petrology of a sample taken at the crest of a historical graphite shaft. Detailed petrology of this sample has revealed the presence of fi ne, medium and coarse fl ake sized graphite. The presence of fl ake graphite greatly increases both the marketability and price of graphite. This initial work has identifi ed an average of 100µm sized fl akes, with a range from 20µm to 200µm in length. Most fl akes are independently arranged in the matrix. Some graphite fl akes are arranged in ‘booklets’ up to 50µm in width.

Whilst the Sugarloaf graphite is at a relatively early stage in terms of exploration, graphite characterization and metallurgical extraction, the deposit could develop rapidly into a signifi cant project.

Geology and exploration Summary

In 2010 the Company revisited Sugarloaf following substantial increases in the market price for graphite. Archer reviewed the historic drill logs of previous explorers in the area noting that graphitic intervals were recorded in 23 of the 41 historic holes drilled on and around Sugarloaf Hill. Geological logs from these historic drill holes recorded intervals of graphite varying from 4 metres to 61 metres. The locations of the holes indicated the potential for signifi cant graphite over a strike length of at least 2 kilometres.

Sugarloaf Metallurgical Diamond Drilling

A graphite concentrate grade of 82%TGC has been achieved using conventional fl otation techniques and standard reagents based on RC drilling.

The Company considered that better quality samples were needed to further metallurgical characterisation of Sugarloaf. Two shallow holes were drilled at Sugarloaf Hill during September 2012 to recover core material for metallurgical test work to determine the processing options to recover graphitic products. The two holes were drilled close to historic mine shafts (circa 1915) on Sugarloaf Hill. The holes (SLDD12_001 and SLDD12_002) were drilled to intersect both weathered and intermediate material for product recovery.

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SLRC12_003
SLDD12 001 & 002
SLRC12_002
2008 holes
2011 holes
2012 holes
Graphite shafts
SLRC12_001
2.1 km
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Figure 25: Location of 2012 diamond drill holes (SLDD12_001 and SLDD12_002) with other AXE drilling.

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Signifi cant Sugarloaf diamond drill assays include:

	*Diamond* *From* *ToInterval* *Assay* *Lithology* *Hole ID* *(m)* *(m)* *(m)* *%TGC*
	SLDD12_001 0 6 6 9.3 and 19 48.5 29.5 11.01 Soft porous graphite to EOH SLDD12_002 0 18 18 5.9 and 24.5 34 9.5 15.4 including 28 34 6 20.4 Terminated in graphite

Table 7: Sugarloaf metallurgical diamond drill results.

SLDD12_001 was collared 10m north of the Eastern shaft and intersected completely oxidised graphite as mined in the adjacent shaft. The graphite zone from 19m down hole is a second graphite horizon. The hole was abandoned at 48.5m due to circulation losses attributable to the highly weathered nature of the graphite body.

SLDD12_002 was drilled to intersect graphite exposed at the surface of the Eastern Shaft and to intersect the graphite seen in the Western shaft material at depth. The fi nal 6m of SLDD12_002 reported over 20%TGC in line with grades recorded from the shafts. Drilling was stopped because suffi cient sample had been collected for the metallurgical test work.

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SLDD12-001 core from surface to 4.9m, averaging 9.2%TGC.

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SLDD12-001 core from 35 to 38.3m, averaging 14.1%TGC.

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SLDD12_002 oxidised graphite representing the Eastern shaft, averaging 20.9%TGC.

REVIEW OF PROJECTS

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Magnesite

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Throughout the 1990s and early 2000s, Magnesium Developments Limited (‘MDL’) and associated companies spent many millions of dollars in exploration and study costs to support a bankable feasibility study aimed at establishing a 50,000tpa magnesium metal plant based on extensive magnesite deposits at Leigh Creek. The plan was not realised primarily due to falling magnesium metals prices and high capital and operating costs. MDL elected to relinquish its exploration licences but retained ownership over the small Myrtle Springs magnesite mine.

During 2010 Archer through its wholly owned subsidiary, Leigh Creek Magnesite Pty Ltd, identifi ed that the ground formerly owned by MDL had become available for mining and immediately applied for and was eventually granted two exploration licences over the southern portion of MDL’s magnesite deposits.

Archer’s philosophy in applying for the tenements was threefold:

The deposits were known to be World Class both in terms of tonnage and grade having JORC Measured, Indicated and Inferred Resources of 453Mt grading 41.4% MgO.
The belief that a project based on the production of Caustic Calcined Magnesia (“CCM”) or Dead-burned Magnesia (‘DBM’), which would negate the high capital costs commanded by a magnesium metal plant, might present a very long-term profi table business case.
Previous exploration was suffi cient to support the estimation of JORC Measured, Indicated and Inferred Resources and in the case of Mt Hutton JORC Reserves as well as other attendant studies needed to support a Mining Lease Application. In essence much of the work needed to develop an operation had already been completed albeit the information was somewhat dated and would require updating.

It is rare that a Company is able to acquire such potentially signifi cant resources for the price equivalent to the application costs for two Exploration Licences.

In late June 2013 Archer became aware that MDL Pty Ltd had applied for an Extractive Mineral Licence for two Mineral Claims that had been held by MDL prior to being granted a Mining Lease ML6092 in 2001. MDL relinquished that Mining Lease in 2009. Archer has written to MDL Pty Ltd and to the Department of Manufacturing, Innovation, Trade, Resources and Energy (DMITRE) seeking to stop the granting of any licence to MDL. Depending on the responses receive Archer may seek legal remedy to the potential dispute over ownership of that portion of the Mt Hutton magnesite deposit covered by the formerly expunged Mineral Claims.

During 2013 Archer materially completed an Information Memorandum and had commenced the process of seeking a joint venture partner or buyer for the project. That process has been put on hold pending the outcome of matters with DMITRE but will be reinitiated as soon as any potential disputation is resolved.

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Archer’s magnesite from drilling results

The world’s largest cryptocrystalline magnesite deposit with JORC Measured, Indicated and Inferred Resources of 453Mt grading 41.4% MgO.

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Figure 1: Interbedded magnesite (white) & dolomite at the nearby Myrtle Springs mine.

Introduction

Archer’s 100% owned Leigh Creek magnesite deposits located at Leigh Creek in South Australia form an advanced project with a JORC Measured, Indicated and Inferred resource of 453 million tonnes grading 41.4% MgO. The former owner completed comprehensive mining plans and environmental base line studies and other attendant studies needed to support a full feasibility study into the manufacture of magnesium metal.

The large outcropping deposits can be exploited with low cost open pit mining. There is existing standard gauge rail 20km to the southeast of the deposits that connects the Leigh Creek Coalfi eld to Port Augusta. Leigh Creek, a well established township lies 25 km from the deposits.

Development options for the advanced project include direct shipping the low impurity magnesite ore through one of the Spencer Gulf ports, utilizing local natural gas to produce caustic calcined magnesia or deadburn magnesia and with potential for magnesium metals production at later stage.

The magnesite deposits are located immediately northwest of the Leigh Creek Coal Mine 220km north of Port Augusta. (Figure 2).

Leigh Creek is a coal mining town with a population of approximately 700. The mine supplies approximately 2.5Mtpa of coal to the Port Augusta Power station 250km south by standard gauge rail. Leigh Creek is connected to Port Augusta by an all weather sealed bitumen road.

Tenements

Archer through it 100% subsidiary Leigh Creek Magnesite Pty Ltd was granted Exploration Licence (EL) 4567 on 20th September 2010 for an initial period of 2 years. EL4567 has a total area of 540 km[2] and covers the Mt Hutton,

Mt Playfair, Termination Hill and Pug Hill magnesite resources. On the 2nd June 2010 Leigh Creek Magnesite made application for ELA 173/10 covering 452 km[2] and the Witchelina magnesite resource. This ELA was approved by the Government of South Australia on 5th December 2010 and was granted to Archer as Exploration Licence EL4729 on 2nd May 2011.

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Figure 2. Leigh Creek Project Location.

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History

The fi rst documented mining of magnesite in the Leigh Creek region was in 1919. Prior to 1984, F.H.Fauldings Co Ltd mined small quantities of magnesite for pharmaceutical and chemical use. In 1984-85 Commercial Minerals mined 30,000 tonnes for use in water fi ltration by Queensland Alumina Ltd. The weekly production grades were consistent and varied from 42.9% to 45.9% MgO and averaged 44.7% MgO; 2.4% CaO; 4.2% SiO2; 0.13% Al2O3 and 0.16% Fe2O3.

In 1999 SAMAG Ltd announced plans to open a major magnesite mine at Mt Hutton northwest of Leigh Creek to supply a magnesium metal plant to be built at Port Pirie on Spencer Gulf (fi gure 1). SAMAG undertook a comprehensive independently audited study of the Leigh Creek magnesite deposits that included JORC Resources and Reserves, comprehensive mineralogical studies, chemical analyses and an Environmental Impact Study with a baselinemonitoring and environmental management plan (EMMP). SAMAG undertook benefi ciation and mine planning studies and negotiated access agreements with traditional land owners and station owners.

The project was abandoned in 2003-04 when SAMAG failed to raise the necessary capital to develop the magnesium metal plant.

Geology, Mineralogy and Trace Element Chemistry

Magnesite chemical sediments occur in the Neoproterozoic Skillogalee Dolomite and in the Leigh Creek region these interbeds are extensively developed over 120km extending NW from Leigh Creek (Figure 3). Magnesite beds were formed by almost pure magnesite precipitation in ancient, shallow marginal marine lagoons and mud fl ats. The magnesite beds have been reworked in-part by storm and tidal activity to produce conglomerates with variable magnesite clast size (1-100mm) and minor and trace amounts of detrital silt and dolomite.

Each magnesite bed has unique chemical and mineralogical characteristics making beds easily identifi able in outcrop or core over several kilometres. The repetitive magnesite beds up to 8m thick are interbedded with dolomite beds (fi gure 1).

The Mt Hutton deposit is typical of the Pug Hill, Termination Hill and Mt Playfair Deposits. It is structurally simple with a continuous, moderately dipping sequence of magnesite and dolomite interbeds over 24.5km of strike. A total of 86 magnesite beds were intersected during evaluation of Mt Hutton. 76 of these beds are continuous over the entire length of the deposit with 10 being lensoidal.

An average of 1.2m of alluvium covers the Mt Hutton Deposit, but much of the deposit is outcropping (fi gure 4).

Minor weathering of magnesite on joints and cracks can be distinguished to a maximum depth of 20 vertical metres.

Mineral resources

In 1998 and 1999 SAMAG carried out 8,093m of diamond drilling at Pug Hill, Termination Hill, Mt Playfair, Witchelina, Mt Hutton and Mt Hutton South, where 61 holes were completed.

All drill holes were fully cored with NQ2 double tube barrels and all drill core was orientated. Holes were surveyed with an Eastman single shot camera at 15m, 50m and end of hole. Core was assayed at AMDEL laboratories in Adelaide, South Australia, a NATA registered laboratory.

In August 1999, Colin Arthur of the Mineral Resource Centre, undertook an independent resource estimate of the Leigh Creek Magnesite Deposits. Magnesite beds from drill traverses and outcrop were geologically interpreted and digitized. An inverse-distance method was used to estimate tonnes and grade into 10m north by 0.5m east and 1.0m RL tabular blocks for Measured category blocks and a simple volumetric estimate for Indicated and Inferred resources. A minimum magnesite bed mining width of 0.5m was used (Table 2).

Magnesite has a theoretical maximum magnesia (MgO) content of 47.8%. The resource estimate extended to 60m vertical depth.

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Figure 3: Geology Leigh Creek Magnesite Deposits. Archer’s deposits are Mt Hutton, Mt Playfair, Pug Hill, Termination Hill and Wichelina.

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	*Regional Historic Resources* *Area* *Measured (mt)* *Indicated (Mt)* *Inferred (mt)* *MgO*
	Pug Hill - 10 10 42.7% Termination Hill 4.0 5 20 42.8% Mt Hutton 18.3 42 53 42.9% Mt Hutton South - 30 - 42.0% Mt Playfair - 21 23 42.5% Witchelina 23.7 94 99 40.0% Total 46 202 205 41.4%

Table 2: SAMAG 1999 JORC Resource Estimate.

Beneficiation

A series of laboratory-scale calcining tests were carried out to establish the magnesia products that could be obtained by calcining at differing temperatures. Testing in 2012 using high pressure grinding rolls (HPGRs) produced magnesia grading >95% MgO and 2.5% SiO2. This material is considered to be well suited in the burgeoning hydrometallurgical magnesia market.

Logistics

Archer’s Leigh Creek magnesite deposits lie just 20 km northwest of the privately owned Leigh Creek to Port Augusta rail line. The rail owner has previously indicated that third party access is possible subject to agreeing terms and conditions.

Leigh Creek is a fully serviced mining town. The population of Leigh Creek has reduced over the last few years in response to the limiting of electricity generation at the Playford power station in Port Augusta. Leigh Creek has the capacity to absorb and house any workforce needed for the intended mining operation.

Conclusion

The Leigh Creek Magnesite Project is an advanced project. The scale, grade and quality of the magnesite is world class and the outcropping deposits can be exploited with low cost open pit mining. Their location close to rail and infrastructure has the potential to minimise mine capital expenditure.

Development options include direct shipping the low impurity magnesite ore through either Port Pirie or Port Adelaide or more practically to utilize local natural gas to produce caustic calcined magnesia or deadburn magnesia.

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Figure 4: Outcropping Magnesite Mt Hutton.

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Figure 5: Cleared Mt Hutton Mine Site.

The scale, grade and quality of the magnesite is world class and the outcropping deposits can be exploited with low cost open pit mining.

REVIEW OF PROJECTS

Gold

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Carappee Hill Mt Messenger Port Pirie
Cleve West North Cowell
Wildhorse Plain
Port Lincoln
Adelaide
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During 2013 low level exploration advanced the Bartel Epithermal gold prospect on Eyre Peninsula and the Napoleons Hat prospect at North Burra.

Wildhorse Plain

Three holes were drilled at the Bartel Epithermal prospect during the year for a total of 187m. The holes were designed to test for depth extensions to mineralisation intersected during 2012. No signifi cant gold assays were recorded however alteration seen previously in association with anomalous gold, such as stylolitic veins and brecciation, were recorded. The alteration chemistry comprises Thorium (Th), Manganese (Mn), Arsenic (As), and Silver (Ag).

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Samples from rock chips and previous drilling (2012) were submitted for petrological examination to confi rm the epithermal alteration of the rocks adjacent to Bartel. One petrological sample showed free gold encased by a grey mineral (possibly antinomy) within a silicifi ed dolomitic rock unit, plate 1.

Future work will consist of mapping and rock chip sampling along strike of this alteration feature with a view of defi ning a footprint for the mineralisation for future drill testing.

Plate 1: Carbonate breccia largely replaced by quartz, carrying a one grain of free gold associated with an equally fine soft grey metallic mineral which is possibly antimony.

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2013 drill holes
2102 drill holes
Gold reported in thin section
0 200 400m
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Figure 1: Location of 2013 RC drill holes at Epithermal.

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Watervale and Wonna Gold (El 4230 / EL 4668)

In previous years (2010 and 2011) Archer identifi ed gold along strike of historical workings at both the Wonna and Watervale. The style of gold mineralisation is similar to many others in the district in that is a consequence of the weathering of sulphides over time (arsenopyrite).

Hydrothermal fl uids carrying gold in solution require changes in either pressure or temperature or both to enable gold to precipitate out of solution. Structural fl exures like the one that exists on EL 4668 (fi gure 2) are potentially large ‘openings’ and may provide the important depositional environment needed to precipitate gold.

Gold in the district is reported to have a very high nugget variance making sampling for gold a “hit-and-miss” proposition. Archer’s intention is to test for primary gold at depth. Underground lodes in the district were documented by government mine inspectors in the early 1900’s as appearing to be associated with strong sulphide alteration and +1oz gold grades. At the time the miners could not extract the gold associated with sulphides and this form of mineralisation was not mined.

Archer completed an electro-magnetic survey over parts of the gold mineralisation with the expectation of identifying discrete conductive (EM) anomalies. This expectation was achieved at the Wonna (fi gure 3) with 2 anomalous signatures identifi ed at depths greater than 100m.

A less intensive EM signature was identifi ed at the Watervale prospect. Two other buried anomalies reside adjacent to cross cutting structures. It is these cross cutting structures that are modelled as the host sites for potential sulphide mineralisation associated with gold.

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Napoleon’s Hat
Port Pirie
Wonna North Burra
Watervale Burra
Worlds End
Australia Plain s
Adelaid e
E L 4668
Potential
Gold
Identified Gold
Wonna
Potential
Watervale Identified
Gold
Gold
Potential
E L 4230
0 0.5 1km
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Figure 3: EM targets at the Wonna and Watervale, with untested potential targets.

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E L 4668
Identified
Gold Wonna Potential
Identified
E L 4230 Watervale Gold
Potential
Potential
0 0.5 1km
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Figure 2: The local geology of EL 4668 and EL 4230, showing the fl exure in the rocks.

REVIEW OF PROJECTS

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Copper

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Copper occurs naturally in the Earth’s crust in a variety of forms. It can be found in sulfi de deposits (as chalcopyrite, bornite), in carbonate deposits (as azurite and malachite), in silicate deposits (as chrysocolla and dioptase) and under supergene weathering conditions can occur as transition sulphides (chalcocite, covellite) passing into cuprite and ‘native’ copper then into the carbonates and/or silicate minerals.

Copper is usually found in nature in association with sulfur. Pure copper metal is generally produced from a multistage process, beginning with the mining and concentrating of low-grade ores containing copper sulfi de minerals and followed by smelting and electrolytic refi ning to produce pure copper cathode. An increasing share of copper is produced from acid leaching of oxidized ores.

Copper is one of the oldest metals ever used and has been one of the important materials in the development of civilization. Because of its properties, singularly or in combination, of high ductility, malleability, and thermal and electrical conductivity, and its resistance to corrosion, copper has become a major industrial metal, ranking third after iron and aluminum in terms of quantities consumed.

Electrical uses of copper, including power transmission and generation, building wiring, electrical and electronic products and telecommunications account for about 75%

of total copper use. Building construction is the single largest market, followed by electronics and electronic products, transportation, industrial machinery, and consumer and general products. Copper byproducts from manufacturing and obsolete copper products are readily recycled and contribute signifi cantly to supply.

Aluminum substitutes for copper in power cables, electrical equipment, automobile radiators, and cooling and refrigeration tube; titanium and steel are used in heat exchangers; optical fi ber substitutes for copper in telecommunications applications; and plastics substitute for copper in water pipe, drain pipe, and plumbing fi xtures. However the unique properties of copper mean that it remains the preferred metal in power transmission and generation, building wiring, telecommunication, and electrical and electronic products.

Copper is one of the most recycled of all metals and can be recycled over and over again without losing its special properties. Recycled copper (known as secondary copper) cannot be distinguished from primary copper.

The global demand for copper continues to grow: world refi ned usage has surged by around 300% in the last 50 years due to expansion in industries such as electrical and electronic products, building construction, industrial machinery and equipment, transportation equipment, and consumer and general products.

The price of copper is volatile as demand and supply are not overly sensitive to price changes in the short run.

Archer has a large and varied copper prospect portfolio including breccia hosted copper, lode copper, and structurally emplaced copper targets that present the Company with exciting exploration targets.

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Drilling at the Robertstown prospects.

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Worlds End (EL 4230)

Worlds End has two potentially signifi cant copper targets; Robertstown and Mimic. Late in 2012 an aerial survey was completed over these two target areas, with the intention of indentifying a conductive body for copper mineralisation.

Robertstown

The historic Robertstown Copper mine which ceased production in 1912 due to water infl ows has been documented as being a signifi cant but underdeveloped copper mine in the Burra region. Mine infrastructure has long been removed.

No remnants of mining infrastructure have been identifi ed however, an old pit has been identifi ed which carries minor cupriet.

8 RC holes totaling 592m were completed during Q2 of 2013 on three targets:

The malachite pit (which carries nodular malachite in clay) thought to represent mining spoil from the historic 230 feet deep shaft (2 holes).
A Copper gossan over a low EM response (4 holes).
Quartz (± arsenopyrite) vein over an EM response (2 holes).

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Napoleon’s Hat
Port Pirie
North Burra
Burra
Worlds End
Australia Plain s
Adelaid e
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The drilling reported minor but uneconomic copper mineralisation.

No formal records exist with the government covering work performed on EL 4230 prior to 1900, however, records do exist with information about the occurrences and mining of copper and base metals back to the 1860’s. These records do not provide exact co-ordinates for the various workings. The 2013 drilling demonstrated that the malachite pit was not spoil from the historic shaft and therefore the historic co-ordinates ascribed in government records for the main shaft are in error.

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Burra B urra
E L 4230
Worlds E nd
Copper
Copper / Gold
Silver
Lead / Silver / Copper / Gold
Magnesite
0 5 10 km
R oberts town
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Figure 1: Location of EM surveys on EL 4230 and local historical mines over a magnetic image.

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Landscape of the Robertstown prospects.

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Drilling hole number 7, with gossan ridge to the RHS of the rig.

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Powerline Road
Archer 2013 drill holes
DMITRE located copper
DMITRE located Pb, Zn, Ag, Cu & Au Mine
0 250 500m
Archer 2013 drill holes
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Figure 2: Location of the drill holes at Robertstown.

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Style of intense folding within the rocks at Robertstown.

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Mimic

The Mimic Prospect is centered on an untested lithological and structural target that has compelling affi nities with the Monster Mine which located 23km WNW of the Mimic target.

It was stated by Drexel (2009) ‘the entire outcrop length of the ≈150m thick Kooringa Member holds potential for copper mineralisation’.

The Mimic target is compelling due to the listed similar features to the Burra Monster Mine;

Antiformal structure

Presence of Kooringa Member
Presence of cross cutting and oblique structures
Elevated potassium at surface
Presence of surface ferruginisation
Presence of distal copper mineralisation with cuprite,
south of target, similar to the Princess Royal mine.

As a part of continued exploration for copper during the year, an electro-magnetic survey was fl own over the Mimic area to identify buried anomalies that could correspond with copper sulphides. A possible target has been identifi ed which cross cuts the geology.

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Historical silver
Historical phosphate
0 1 2km
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Figure 3: EM signature of the Mimic.

North Cowell (EL 4277)

The tenement was applied for due to the proximity of the Polda Lineament (EW), the Kalinjala Shear (NNE) and the Eyre Peninsula Conductivity Anomaly (NS), all of which are deep crustal structures forming boundaries to the tenement areas. These structures may have acted as a focus for hydrothermal fl uid fl ow – a precursor to the formation of mineral deposits. The tenement also contains numerous NNW structures which have been highlighted as signifi cant controls on mineralizing fl uids for the Eyre Peninsula.

The area has been explored for in the past for Broken Hill style mineralisation with limited success. The limited success may be attributable to the area undergoing considerable alteration due to the later stage intrusion of felsic rocks. The fl uids associated with the intrusion could have remobilized base metal deposits into pre-existing structures. Rock chip assays of over 10% lead have been collected by Archer.

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4.6% average
2.3% average
3.8% average
6.8% average 0.19% average
0 0.5 1km
0.37% average
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Figure 4: Morrowie Copper (%) from rock chip sampling.

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The possibility also exists for an IOCGU deposit, as the Hiltaba granite has been mapped by PIRSA 20km to the east of the tenement and appears to have the correct plumbing to connect the area. As a side note the area has been commented on before as containing vein style uranium, which could support this notion. All copper occurrences are carbonates (malachite and azurite) and have been reported to “pinch out” at depth, which is expected to occur where fl uids have exploited pre-existing structures. Any economic mineralisation for copper is expected to be greater than 100m below the surface and structurally controlled.

Work to date has been limited to reconnaissance rock chip sampling around areas of known mineralization. Samples with peak values of 15.1% Cu form a prominent ridge at Morrowie (fi gure 4).

During 2012 an airborne EM survey was conducted to identify possible conductive bodies as sources to the surface mineralisation north of the Morrowie copper anomaly.

A subtle response is observed below the copper anomalism within the Morrowie area. This anomaly has been earmarked for future drill testing. Additionally, to the east of Morrowie is an EM signature that cross cuts the general geology of the area which indicates the potential for a late stage intrusive.

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Copper
Copper [+] /- lead, silver, uranium
Silver, lead
Other deposits, graphite, iron, manganese
0 2 4km
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Figure 5: EM response from survey North of Morrowie (Cu).

Future exploration work will focus around the north striking ridge with a view to developing drill targets.

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Copper
Copper [+] /- lead, silver, uranium
Silver, lead
Other deposits, graphite, iron, manganese
0 0.5 1km
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Figure 6: EM signature east of Morrowie.

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Emu Plain

Emu Plain is located on EL4693 near Cleve on Eyre Peninsula, South Australia, no work was performed on the location in the reporting year.. The area hosts the historic Emu Plain copper mine that was fi rst developed in the early 1900s and last re-developed in the 1950s. No production records have been located.

Early regional reconnaissance undertaken around the Emu Plain copper shaft identifi ed iron oxide ‘blebs’ that were interpreted to represent oxidised expressions of an unknown primary sulphide. Petrological examination confi rmed the oxide blebs were most likely highly weathered chalcopyrite.

In 2011 Archer conducted a three hole RC drill program to test in the vicinity of the historic shaft. The drilling intersected large intervals of mainly muscovite-rich schists. In some intervals considerable oxidation of sulphides had occurred resulting in the development of minor hematite. In other intervals (as shallow as 20m below the surface) chalcopyrite was observed in trace to minor amounts.

The style of the alteration to the rocks and the low levels of copper suggest that the drill holes may have intersected part of a much greater mineralisation system. The size and nature of the system is unknown at this time.

Hole EPRC11_003 was designed to miss the stope fi ll recorded in hole 2 and intersected dominant muscovite and biotite and accessory limonite, hematite and chalcopyrite. The interval 27 to 35m which was dominated by muscovite, limonite and chalcopyrite reported 8m @ 0.7% Cu, 7g/t Ag and 450ppm Mo. The highest grade in this interval was 1m @2.18% Cu from 29m.

The interval 65 - 99m had muscovite and biotite changing as the dominant mineral with higher copper grades being associated with the muscovite dominant mineralogy. This interval recorded 34m @ 0.15% Cu, 2g/t Ag and 81ppm Mo. The highest grade in this interval was 1m @1.5% Cu from 93m.

The Emu Plain prospect requires additional drilling along strike to determine the copper potential.

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200µm
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Spring Creek

No ground work was performed during the year.

Copper was historically mined at the Spring Creek mine until early in the 20th Century when water infl ows caused the cessation of the mining operations.

Copper mineralisation at Spring Creek occurs at the surface as oxides and carbonates. Deeper sources (sulphide) have not been explored but it is logical to conclude that the defi nitive structural setting may have sulphide roots.

The Spring Creek Copper Mine occurs within an east-west striking breccia. Copper mineralisation is dominated by copper carbonates, typically malachite. Copper carbonates exist on the surface above the mine and within the backs and walls of the historic drives. Two drives were mined down to a fi nal level of 30m with approximately 20m between the drives. The overall width of the mineralisation appears to be approximately 10m wide at the surface and at least 120m in strike.

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E L 4249
Spring Creek copper mine
Brighton limestone
0 5 10 km
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Figure 8: Magnetic image of Spring Creek area, note NNW structure north of Spring Creek Mine. Blue lines indicate location of Brighton limestone.

Figure 7: Polished section (PS), (x50). Gossanous/goethite box-work with a fine trellis texture interpreted to represent original chalcopyrite now completely oxidised and leached.

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Spring Creek

No ground work was performed during the year.

Copper was historically mined at the Spring Creek mine until early in the 20th Century when water infl ows caused the cessation of the mining operations.

There are two exploration targets:

The breccia - its location is approximately 2.5km from a large regional fault. Insuffi cient work has been performed to determine the relationship of the fault to the sub-parallel breccia. The total vertical extent of the breccia is unknown and may be of considerable volume, fi gures 3 and 4.
Potential skarn - fl uids associated with the breccia may have developed a skarn deposit at depth when exposed to the Brighton Limestone.

DDH 1/29, intersected copper carbonates some 60m below the base of historical workings returning an assay of 1.8% Cu over a 21m interval (Figure 10).

It is believed that DDH1/29 did not intersect the Brighton Limestone contact which is highly prospective for high grade metasomatic skarn copper mineralisation.

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Underground workings
Cu mineralised breccia
Historic Diamond drill hole
0 25 50m
DDH 1/29
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Figure 9: Aerial view of Spring Creek with location of historical underground workings.

Figure 10: Cross section of drill hole DDH1/29.

REVIEW OF PROJECTS

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Manganese

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Manganese is the fourth most used metal in terms of tonnage, being ranked behind iron, aluminum and copper, with in the order of 40 million tonnes of ore being mined annually. The main manganese minerals are pyrolusite (MnO2), rhodochrosite (MnCO3), manganite (MnO(OH)) and psilomelane (Ba,H2O)2Mn5O10.

The major deposits of manganese include;

Chemical sedimentary - Clastic sediments of varying composition to iron formations and carbonate rocks in either a geosynclinal or stable platform structural setting.
Surfi cial/residual - Formed near the surface by the supergene processes of leaching and residual enrichment of either existing manganese deposits or low-grade manganese-bearing protore.
Hydrothermal - Emplaced by rising thermal waters.
Metamorphosed - Thermal and/or dynamic metamorphism.

Manganese also occurs abundantly on the ocean fl oor in the form of nodules which usually also contain cobalt, nickel, copper, and iron. It is estimated that up to 1.5 trillion metric tonnes of manganese nodules may occur on the world’s ocean fl oors. Currently, there is no profi table method for removing these ores.

The bulk of globally traded manganese ore is in the high grade range (≥40% Mn). Few deposits can be mined at these grades and many operations such as the Australian mining operations at Woodie Woodie and Bootu Creek mine lower grade ore (≤20% Mn) and benefi ciate to produce saleable product.

Archer has 100% interest seven manganese deposits and prospects (Ketchowla, Stone Hut, Kanyaka and Neale’s Flat in the Adelaidean; Jamieson Tank, Salt Creek and North Cowell on Eyre Peninsula).

The current more advanced Archer manganese prospects (Ketchowla, Salt Creek and Jamieson Tank) have grades ranging from 15% - 20% Mn. Benefi ciation tests on Ketchowla K1 ore indicates that saleable manganese grading ≈40% Mn (Ni 0.4%; Co 0.3%; Cu 0.3%; Zn 0.25% and high REE content including ≈400ppm Yt) can be recovered at an excellent recovery of 23%. Salt Creek also has manganese that can be benefi ciated but at a lower head grade of around 30% Mn but is associated with high iron content. Jamieson Tank is more clay rich manganese ore.

The aggregate Exploration Potential of Ketchowla, Salt

Creek and Jamieson Tank deposits is considered to be signifi cant enough to warrant continued expenditure to determine resource size.

Archer also has early exploration manganese targets (Stone Hut, Neale’s Flat, Kanyaka and North Cowell) that need assessment.

Archer’s Advanced Manganese Projects

This summary covers the Ketchowla and Salt Creek deposits which are the most advanced in terms of exploration.

Ketchowla Manganese Projects

The area has been explored for copper and molybdenum mineralisation historically. Most exploration was focused on the eastern side of the tenement where extensive shallow drilling has been performed. This exploration for copper and molybdenum did not identify signifi cant targets. The drilling did however report widespread manganese to less than 1% over vast areas of the tenement.

Many small quartz blows exist throughout the tenement which are mineralised with both gold and copper to low levels (0.1g/t and 0.1% respectively) and minor amounts of manganese which appears as veins.

The Ketchowla Hill Manganese Mine (Figure 1) was last worked in 1941 when it produced 358 tons of ore. Little other information exists on historic production. Site investigations outlined a 320m strike length of manganese oxide outcrop centred on a small, shallow open pit.

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EL 4266
K1
4m @ 17.5% Mn K2
8m @ 15.6% Mn
1m @ 33.6% Mn
K6 1m @ 31.7% Mn
K10
K8
2m @ 18.9% Mn
2m @ 17.5% Mn 2m @ 18.8% Mn
4m @ 29.3% Mn
3m @ 19% Mn
0 2.5 5 km
K9
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Figure 1: RC drill hole locations and manganese intersections from 2010 drilling. Host rock in black.

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In February 2010 Archer completed its maiden drill program at the Ketchowla Manganese Project. Many of the holes intersected intervals of mineralisation exceeding 5% manganese (fi gure 2). Preliminary metallurgical recovery testwork was performed on some of these samples to determine if a saleable product could be achieved. Results from this work indicated that a saleable Mn product could be recovered. Test work using density separation and gravity concentration successfully upgraded the 17.5% Mn sample to >35% Mn (23.2% recovery). The test work also demonstrated upgrading of the Ni (0.26% to 0.41%); Co (0.17% to 0.30%); Cu (0.23% to 0.38%) and Zn (0.16% to 0.28%).

Ketchowla Manganese Prospects

In February 2010 Archer completed its maiden drill program at the Ketchowla Manganese Project which centered on drilling the sampled manganese outcrops (fi gure 1). Since that time Archer has been experimenting with a low cost method of determining the presence of manganese under cover using gravity surveys (2012) and electro-magnetic surveys (2013).

From Figure 1 it can be seen that vast areas exist between the outcrops which provides the potential for mineralization to continue under cover as seen at other manganese mines in Australia.

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Mn 27.7% EL 4266
Ni 0.41%
Co 0.46%
Cu 0.24%
Zn 0.36%
Mn 28.1%
K1
Ni 0.18%
Co 0.4%
Cu 0.22%
Zn 0.13%
Mn 34.2%
Ni 0.38%
Mn 26.7% Co 0.47%
Ni 0.53% Cu 0.13%
Co 0.21% Zn 0.47%
Cu 0.25%
Zn 0.26%
Mn 32.5%
Mn 32.8% Ni 0.11%
Ni 0.35% Co 0.21%
Co 0.22% K2 Cu 0.14%
Cu 0.38% Zn 0.16%
Zn 0.26%
Drill hole highlights
K1RC001
8m @ 15.6% Mn Interpreted host
0.15%Ni, 0.14% Co0.21% Cu, 0.15% Zn rock contact, Drill hole highlights
buried by cover.
K2RC002
K1RC004
1m @ 33.6% Mn
4m @ 17.5% Mn
0.11% Co
0.15% Ni, 0.11% Co
0.34% Cu, 0.15% Zn
K2RC003
1m @ 31.7% Mn
0.11% Co
0 1 2 Km
Rock Chip Manganese Legend
30% to 50% Mn 10% to 20% Mn Manganese Host Rock
Nuccaleena Formation
20% to 30% Mn 0 to 10% Mn
(Dolomite host rock)
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Figure 2: Rock chip grades and drill hole results K1 and K2 Ketchowla.

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K1
K8
2010 drill holes
2013 EM survey area
Host rock K9
0 2.5 5 km
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Figure 3: Location of EM survey areas and outcropping host units.

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Target under cover
0 250 500m
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Figure 5: K9 surface, showing target under cover.

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0 250 500m
0 250 500
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Figure 4: EM response for K9.

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Looking South of Ketchowla Manganese Workings.

Ketchowla Geophysical Surveys

Three areas were fl own by TDEM (Time Domain Electro Magnetics) in late 2012 (fi gure 4) to determine if an EM signature could be used to detect the presence of Mn occurrences under cover.

Figures 4 and 5 clearly show EM anomalies in areas of alluvial cover that will require drill testing. Processing of this data is still ongoing as other channels of data are being modeled to determine their ability to predict buried manganese at Ketchowla.

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K9
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Looking from K8 to K9

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Salt Creek Manganese Project

Background

Manganese mineralisation on the Eyre Peninsula is associated with the Lower Middleback Jaspilite and appears to be enriched at the surface.

A fi rst pass 19 hole RC drill program to determine mineralisation extents and develop a model for the mineralisation was completed in April 2011. The program was only focused on the western limb of the mineralisation, subsequent to the drilling a synclinal model has been developed for mineralisation. Figure 6 shows the location of the drill holes, with the theoretical fold limbs being tested by 2013 drilling.

Three holes drilled in 2013 to test the synclinal deposition model did not intersect enriched manganese instead intersecting sheared quartzites and amphibolites. The model for the mineralisation has been revised to a faulted repetition of the limb rather than a fold repetition.

EM data has highlighted prominent signatures to the west of the 2011 drill holes (fi gure 7). Future exploration will be focused on testing the EM data and its ability to predict buried Mn.

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2011 drill holes 2011 drill holes
2013 drill holes 2013 drill holes
Proposed syncline
Future Mn targets
Proposed anticline
0 500 1km 0 500 1km
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Fig 6: A plan view of the previously interpreted fold structures, with 2013 drill holes.

Figure 7: 40m depth slice for EM data at Salt Creek.

REVIEW OF PROJECTS

Nickel

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In the mid 1980’s part of the prominent Pindari regional magnetic anomaly was explored for metals and diamonds (fi gure 1). Archer recovered core that was drilled in 1987 for diamonds and submitted intervals for assay to better understand the geochemistry of the material drilled. Petrological examination was also conducted on a number of intervals.

Archer’s early exploration work identifi ed that primary nickel sulphides (violarite and pendlandite) and primary copper (chalcopyrite) was present in the drill core. Elevated nickel and chromium was reported in the weathered part of the core.

In 2010 seven Reverse Circulation (RC) holes were drilled to test for shallow nickel mineralisation. The average drill

hole depth was 45m. Six of the seven holes intersected ultramafi c host rocks with pyroxene, olivine and pyrrhotite. Other host rocks intersected were highly altered sediments providing support for a layered complex. Figure 2 shows the spatial relationship of the RC holes and rock types overlaying a processed EM image.

The Pindari anomaly has a strongly concentric ring structure with the centre consisting of altered and unaltered ultramafi c rocks. The second and most prominent (complete) ring appears to be comprised of altered sediments with a graphitic component that generates the EM signature. Figure 3, is a magnetic image showing the scale of the circular outer feature being some 3 to 4km in diameter.

The initial geological model of a layered igneous complex intruded by later felsic rocks is still thought to be the case at Pindari. The later stage felsic rocks may have disturbed pre-existing sulphides and possibly resulted in a disseminated Ni- Cu sulphide system. Future drilling is planned to test the anomaly at depths greater than 100m vertically.

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Pindari anomaly
0 10 20km
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Figure 1: Regional magnetic image for Central Eyre Peninsula, with the Pindari anomaly highlighted.

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EM signature possibly due
Ultramafi c to pyrrhotite altered rocks
underlain by
meta seds and
some igneous
meta sediments
norite/pyroxenite
mafi c/ultramafi c EM signature possibly due
to Ni sulphides at depth
amph ibolite
pyrox enite
pyroxenite
0 250 500m EM signature possibly due to
graphite in metasediments
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Figure 2: EM Depth slice from 185m showing segregated nature of the Pindari anomaly.

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0 0.5 1km
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Figure 3: Magnetic image for Pindari, demonstrating the magnitude of the circular structures.

REVIEW OF PROJECTS

Industrial Minerals

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Barite and phosphate have an unique range of

properties and a wide range of applications for all sorts of industrial needs.

Phosphate

Worlds End (EL 4230)

Historic phosphate mines exist on both the Worlds End (EL4230) and Australia Plain (EL 4482) tenements.

Mines Department records indicate that production from these areas was limited and operations ceased before 1920.

Phosphate and Barite

Archer has four tenements covering prospective phosphate and barite prospects.

Reconnaissance level exploration including literature searches and rock chip sampling has been conducted for phosphate. Exploration for barite evolved from its potential as a standalone project to a possible indicator of carbonatite intrusives. Carbonatite intrusive may be enriched in Rare Earth Elements (REE).

Primary focus has been on the tenements Worlds End (EL 4230) and Australia Plains (EL 4482). One additional tenement EL 4840 (Eudunda) is located near to Australia Plains, fi gure 1. Another tenement EL 4869 (Ediacara) is located south east of Leigh Creek also has a history of small scale barite mining.

Reconnaissance exploration has consisted of soil sampling and selected rock chip sampling. The Fairview phosphatic unit was reported to have a width that varied from 60m to 120m and extended to a depth of 22m (fi gure 2).

Historic records indicate that the phosphatic units occur over a strike length of approximately 12kms stretching approximately 6km to both the north and south of the Fairview workings.

Future work will focus on rock chip sampling and to see if the phosphatic units can be traced using available radiometric data. Once the strike is known and further rock chip sampling is conducted across and along strike to confi rm likely phosphate grades, it should be possible to determine the probability of identifying an economic deposit prior to committing funds for drilling.

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Phosphate prospect
Barite prospect
0 10 20 km
E L 4230
E L 4482
E L 4840
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Figure 1: Locality of phosphate and barite prospects.

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Rock Chip Sample
19.93% P205 +0.5% P Soil Sample
+0.2% P Soil Sample
+0.1% P Soil Sample
+0.05% P Soil Sample
0 250 500 m
4.92% P205
10% P205
5.16% P205
4.08% P205
10.93% P205
7.45% P205
5.17% P205 4.65% P205
5.02% P205
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Figure 2: Phosphate work to date at Fairview, EL 4230.

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Australia Plains (EL 4482)

Phosphate was reported in 1909 at the Rices Mine, where a 50ft shaft was sunk. The occurrence was noted to be ill-defi ned. Iron ore fl ux was once sourced from this occurrence. To the north (1.2km) along strike is another mine working, the Eime Phosphate Mine. No production records could be found for this mine (fi gure 3).

Barite

No work has been performed on tenements EL 4840 (Eudunda), EL 4482 (Australia Plains) and EL 4869 (Ediacara) for the barite potential. Both tenements remain prospective for barite deposits.

Future exploration will include literature searches, rock chip and soil sampling to determine the size and tenor of the barite occurrences.

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E L 4840
Phosphate prospect
Barite prospect
0 2.5 5 km
E L 4482
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Figure 4: Location of barite prospect shown in green on Eudunda and Australia Plain.

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E L 4482
Elme Phoshate Mine
Rice Phoshate Mine
Dutton Barite Mine
0 1 2 km
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Figure 3: Location of Phosphate on Australia Plains (EL 4482).

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E L 4869
Barite occurrences
0 5 10 km
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Figure 5: Location of barite occurrences on EL 4869 (Ediacara).

REVIEW OF PROJECTS

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Coal ± Gasifi cation

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During 2011 Archer applied for an Exploration Licence covering 885km[2] to the southwest of Leigh Creek and stretching to the east of Lake Gairdner. The application was accepted as EL 4869.

exploring for northern and southern extensions to lead and copper mineralisation found within the reserve, intersected lignite-rich material in three holes; CT1 (located in the north of the ELA); and CT2 and CT3 (located some 8km inside the SW boundary), fi gure 2. Other holes that have historically intersected lignite are also shown on fi gure 2.

Hole CT1 intersected sandy lignite and lignite from 256m to 289m below competent and fi rm transported clay.

EL 4869 excludes all ground associated with the Ediacara Fossil Reserve. The tenement was initially applied for to cover areas where historic exploration was focused on base metals, industrial minerals and coal. As a consequence of reviewing historical work performed under the EL a PELA (PELA 567, fi gure 1) was made.

Hole CT2 intersected sandy lignite and lignite from 254m to 290m below competent and fi rm transported clay.

Hole CT3 intersected sandy lignite and coal fragments from 234m to 244m below competent and fi rm transported clay and recorded two wide intervals of lignite and coal:

264 to 276 sandy lignite

The historic work revealed that in 1983 the Commonwealth Aluminum Company (Comalco) whilst

298 310m (EOH) clay with sub bituminous coal

All the CT holes were drilled on the western side of the Ediacara Range (Ediacara Fault) in a separate sub basin. Another smaller and shallower sub basin occurs to the east of the range (PC holes). The consistency of lignite intercepts from the CT holes in terms of depth and thickness strongly suggest the lignite and coal intercepts represent one depositional event.

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CT1
T3
T1 B 1
PC6
PC5
CT2
PC8
CT3
A3
0 5 10 km
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Since applying for the PELA the greater surrounding area has been taken up by explorers looking for unconventional shale gas. The Tindelpina Shale Member (which underlies the PELA) has hydrocarbon potential based upon a drill hole drilled some 90km to the SE of the tenement into this unit. This hole reported the Tindelpina Shale with a Total Organic Content (TOC) of 1.1%.

Figure 1: PELA 567, showing the excluded Ediacara Fossil Reserve.

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CT1
T3
T1 B 1
PC6
CT2 PC5
CT3
PC8
A3
0 5 10 km
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Recent work by Geoscience Australia (2012) further highlighted the petroleum potential (particularly for unconventional gas) of the Arrowie Basin in which PELA 567 resides. Geoscience Australia reported (Report REC2012_36) that both the Tindelpina and Oraparinna Shale Members contained a minor component of organic material which when combined with a favourable geological history indicates the potential for petroleum products to be preserved.

Figure 2: PELA 567 with drill holes reporting lignite.

Directors’ ReportDirectors’ Report

Your Directors present this report on Archer Exploration Limited and its consolidated entities (‘Group’), for the year ended 30 June 2011.

A detailed description of the Group’s operations and fi nancial position is set out elsewhere in this Annual Report.

Signifi cant Changes in State of Affairs

Directors

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The names of Directors in offi ce at the date of The Directors are not aware of any signifi cant changes
this Report: in the state of affairs of the Group occurring during the
fi nancial year, other than as disclosed in this Annual
Greg English
Report.
Tom Phillips AM
Alice McCleary Matters Subsequent to the End of the
Gerard Anderson Financial Year
John Dawkins AO
Peter Meers No other matters or circumstances haven arisen since
the end of fi nancial year which have signifi cantly
The above named Directors held offi ce during and since
affected or may signifi cantly affect the operations of the
the end of the fi nancial year, except for Mr Peter Meers
Group, the results of those operations, or the state of
who was appointed a Director of the Company on 12
affairs of the Group in future fi nancial years.
November 2010.
Future Developments, Prospects and
No Directors resigned during or subsequent to the
Business Strategies
end of the fi nancial year. A biography and statutory
disclosures regarding each director and the Since listing on the ASX in August 2007, the Company
Company Secretary are provided elsewhere in this has developed a long pipeline of projects. During
Directors’ Report. fi nancial year the Company prioritised its exploration
and development focus towards two principal strategic
Principal Activities
commodities; graphite and magnesite. This push will
The principal activity of the Group during the course continue throughout 2012.
of the fi nancial year was the exploration for minerals
Archer’s graphite interests grew rapidly during 2011
on the Group’s exploration licenses in South Australia.
to compliment the Company’s 100% owned Carappee
There has been no change to these activities during the
Hill EL3711 that hosts the Sugarloaf graphite deposit.
fi nancial year.
Archer, by meeting its expenditure obligations under a
Operating Results farm-in agreement with Gingertom Pty Ltd (a wholly
owned subsidiary of Uranium SA), earned to the right
The loss of the Group was $976,877 after receiving a
to all minerals other than uranium on Gingertom’s
research and development concessional grant of $9,757.
EL4693 Wildhorse Plains. In addition Archer applied for
Dividends and was granted ELA148/11 covering 54km [2] of ground
highly prospective for extensions to and or repetitions
No dividends were declared or paid during the fi nancial
of graphitic horizons identifi ed on Carappee Hill and
year. No recommendation for payment of dividends has
Wildhorse Plains. Graphite is a highly prized strategic
been made.
mineral critical in the worldwide push to fi nd ‘green
Review of Operations energy’ solutions. The area controlled by the Company
has several occurrences of coarse fl ake graphite which
During the year Archer employees conducted technical
is critical in the development of spherical graphite for
evaluations of all of the Group’s owned Exploration use in fuel cells and lithium-ion batteries. Demand for
Licences. Field work including geophysical surveys,
graphite is experiencing unprecedented growth and the
geological mapping, soil sampling, rock chip sampling
outlook given the automotive industry’s push towards
and drilling was conducted on several of the Company’s
electric vehicles, looks set to continue.
tenements. In addition, Archer conducted exploration
activities on one third party tenement as part of a farm-
in agreement.
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ANNUAL REPORT 2013
ARCHER EXPLORATION LIMITED
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Directors’ Report

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Your Directors present this report on Archer Exploration Limited and its consolidated entities (‘Group’ or ‘Archer’), for the year ended 30 June 2013.

Directors

The names of Directors in offi ce at the date of this Report:

Greg English
Tom Phillips AM
Alice McCleary Gerard Anderson

A biography and statutory disclosure regarding each Director and the Company Secretary are provided elsewhere in this Directors’ Report.

Principal Activities

The principal activity of the Group during the course of the fi nancial year was the exploration for minerals on the Group’s exploration licenses in South Australia. There has been no change to these activities during the fi nancial year.

Operating Results

The loss of the Group was $359,581 after receiving a research and development concession of $322,594 resulting in a net tax benefi t for the year of $322,594.

Dividends

No dividends were declared or paid during the fi nancial year. No recommendation for payment of dividends has been made to the date of this report.

Operating and Financial Review

Archer’s business is mineral exploration. The Company has 13 granted Exploration Licences all in the state of South Australia covering a wide range of mineral commodities.

Over the last two years the Company has largely focused on the evaluation of its graphite projects located near Cleve on Eyre Peninsula and in particular the graphite deposits that make up the Campoona graphite deposit.

During 2013 Archer made substantial progress in the evaluation of the 100% owned Campoona graphite deposit including:

Resource drilling at Campoona Shaft and Central Campoona.
Regional exploration drilling identifi ed three further bodies of highly graphitic schist.
Estimation of a Maiden JORC Resource.
A detailed market assessment for Campoona’s graphite products indicated that Campoona’s concentrates would most likely be highly sought after by specialist manufacturers and end-users for use in batteries, polymers, ceramics, and high tech lubricants.
Baseline Spring Ecological surveys.
Purchased the 1,403 acre Sugarloaf property that hosts the bulk of the Company’s Sugarloaf graphite deposit. The property is also the preferred site for any future processing facility.
Entered into a binging Heads of Agreement to purchase 120 acres of land at Campoona Shaft which when completed on land subdivision, will ensure Archer has all of the land needed to commence operations.

The 2014 business plan for Campoona is to complete the studies needed to support a Mining Lease Proposal and Programme for Environmental Protection and Rehabilitation and to lodge those documents to the regulatory authorities for approval in mid calendar 2014. The work has been tendered and Golder Associates selected to undertake the studies based on a combination of technical expertise, knowledge of the Cleve environment, scheduling and price.

The most important factor infl uencing the size of the development proposed for Campoona is securing marketofftake. Bulk fl otation tests currently in progress will produce several kilograms of fi nal product that will be sent to selected end-users for evaluation in Q4 calendar 2013. That marketing campaign will determine the size of project at start-up.

With a cash balance of $8.56 million the Company can fully fund the expected $700,000 needed to complete the Mining Lease Proposal.

The Company is mindful of the diffi culty of raising capital in this market and expects those adverse market conditions to continue for much of 2014. To that end the Company is looking at the ability to enter the market in 2015 in a small but meaningful way via a high margin, low capital cost option. Such an entry would enable Campoona products to gain a market reputation which can be used for future expansion of production capacity.

Archer would consider taking on a joint venture partner to help co-develop the Campoona project but would only contemplate such an action if that partner could lead to a stronger, de-risked (capital and marketing) project.

Rigorous bench-scale metallurgical test work showed Campoona can deliver very high grade and ultra-pure -75 micron graphite concentrates grading 97 % - >99% C.

Directors’ Report

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During 2013 the Company also completed short exploration programmes at the Epithermal gold prospect on Wildhorse Plain, at the Salt Creek manganese prospect and at the Robertstown copper prospect.

The Epithermal gold prospect at Wildhorse Plain has a +6km zone of epithermal alteration and two areas of extensive brecciation and silicifi cation that carry widespread anomalous gold. Drilling in 2012 demonstrated the area’s potential to host economic gold mineralisation when it returned an intercept of 29m grading 0.57g/t Au.

A limited drilling campaign at Robertstown returned low grade copper anomalism.

A short drilling programme at Salt Creek tested for enriched manganese within the synclinal keel located west of the main manganese body. No economic manganese was intersected.

The Company has two projects that are considered as assets best developed by other parties. The fi rst of these potential divestment projects is the Leigh Creek magnesite deposit. An Information Memorandum covering the Company’s Leigh Creek Magnesite Deposits has been materially completed. Completion has been delayed pending the outcome of a dispute relating to the ownership of the Mt Hutton portion of the greater Leigh Creek deposits. Archer’s Leigh Creek magnesite deposits are by far the World’s largest cryptocrystalline magnesite deposits with JORC Resources of 453Mt grading 41.4% MgO. On 27 June Archer received notifi cation from Magnesium Developments Limited (MDL) that they were the registered holder of two Mineral Claims over the Mt Hutton portion of the Leigh Creek magnesite deposits. Archer has challenged the validity of MDLs Mineral Claims and that challenge may include legal proceedings. The plan once the dispute is resolved is to put the asset up for sale.

The second potential divestment opportunity is the Company’s manganese projects at Ketchowla, Salt Creek and Jamieson Tank either separately or as a package.

In addition to the principal activity of developing a mine at Campoona Archer will continue to prioritise exploration on emerging exploration projects outside of graphite including the Epithermal gold project at Wildhorse Plain, gold targets at Wonna and Watervale and copper projects at Spring Creek, North Cowell and Robertstown.

A detailed description of the Group’s operations and fi nancial position is set out elsewhere in this Annual Report.

Signifi cant Changes in State of Affairs

In April Archer acquired 1,403 acres of land known as the Sugarloaf Property that hosts most of the Company’s Sugarloaf graphite deposit. This land acquisition is a signifi cant milestone in the ongoing process of preparing a Mining Lease Proposal. The Directors are not aware of any other signifi cant changes in the state of affairs of the Group occurring during the fi nancial year, other than as disclosed in this Annual Report.

Matters Subsequent to the End of the Financial Year

In addition to the Sugarloaf Property purchase, the Company signed a Heads of Agreement on 1 July 2013 covering the purchase of 120 acres of land at Campoona Shaft. Final payment for the Campoona Shaft Land will occur on subdivision of the land. Archer now has the land needed to commence mining and mineral processing of the Campoona Shaft and Sugarloaf deposits.

Other than as detailed above, no other matters or circumstances have arisen since the end of the fi nancial year which have signifi cantly or may signifi cantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future fi nancial years.

Future Developments, Prospects and Business Strategies

The primary business objective for 2014 is to undertake those studies needed to support a Mining Lease Proposal and Programme for Environmental Protection and Rehabilitation (PEPR) covering the mining of the Campoona graphite deposits and the subsequent mineral processing operations. It is expected that the studies will be mostly complete by 30 June 2014 allowing for government approval of the project late in calendar 2014. Archer has the cash at bank to fully fund those studies.

Exploration activities for 2014 will concentrate mostly on the Company’s copper and gold prospects.

Archer intends to put the Company’s magnesite interests up for either joint venture or sale during 2014. The Leigh Creek magnesite deposit with JORC Measured, Indicated and Inferred JORC Resources of 453Mt grading 41.4% MgO, is the World’s largest cryptocrystalline magnesite deposit. Subject to any legal proceedings relating to the Mt Hutton portion of the JORC Resource, Archer will complete the Information Memorandum and commence the joint venture or sale process.

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Directors’ Report

Environmental Issues

The Group’s operations are subject to signifi cant environmental regulations under the laws of the Commonwealth and/or State. No notice of any breach has been received and to the best of the Directors’ knowledge no breach of any environmental regulations has occurred during the fi nancial year or up to the date of this Annual Report.

Remuneration Report (Audited)

This report details the nature and amount of remuneration for each director of Archer Exploration Limited and for the Key Management Personnel.

Remuneration Policy

The Board acts as the remuneration committee as a consequence of the size of the Board and the Group. The Board believes that individual salary negotiation is more appropriate than formal remuneration policies and external advice and market comparisons are sought where necessary. The Group discloses the fees and remuneration paid to all Directors as required by the Corporations Act 2001. The Board recognises that the attraction of high calibre executives is critical to generating shareholder value.

The directors and executives receive a superannuation guarantee contribution required by the government which increased from 9% for the 2013 year to 9.25% from 1 July 2013 (Managing Director contribution is 10%), and do not receive any other retirement benefi ts. Some individuals, however, have chosen to sacrifi ce part of their salary to increase payments towards superannuation and/or elected to increase superannuation contributions a part of their salary package.

The Board policy is to remunerate non-executive directors at the market rates for time, commitment and responsibilities. The Board determines payments to non-directors and reviews their remuneration annually, based on market price, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees that can be paid to non-executive directors is $500,000 per annum which has not changed since Archer listed on the ASX in August 2007. These amounts are not linked to the fi nancial performance of the consolidated Group. However, to align director’s interests with shareholder interests, the directors are encouraged to hold shares in Archer.

Each member of the executive team has signed a formal contract at the time of their appointment covering a range of matters including their duties, rights, responsibilities and any entitlements on terminations. The standard contract sets out the specifi c formal job description.

Voting and comments made at the Company’s 2012 Annual General Meeting

The Company received more than 97% of ‘yes’ votes on its remuneration report for the 2012 fi nancial year. The Company did not receive any specifi c feedback at the AGM or throughout the year on its remuneration practices.

All remuneration paid to Directors and executives is valued at the cost to the Group. The Group has established a Share Option Plan for the benefi t of Directors, offi cers, senior executives and consultants. Shares issued to Directors and executives are valued at the difference between the market price of those shares and the amount paid by the director or executive. Options are valued using the Black-Scholes valuation methodology and recognised as remuneration in accordance with the attached vesting conditions.

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Directors’ Report Information on Directors’ and Management

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Greg English LLB, BE (Mining) Chairman

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Gerard Anderson Assoc. Applied Geology, Grad Dip Bus, MSc Managing Director

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Tom Phillips AM MBA FAICD Director (Non-Executive)

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Alice McCleary Craig Gooden DUniv, BEc FCA FTIA FAICD CA Director (Non-Executive) Company Secretary

Greg English is a qualifi ed mining engineer and lawyer. He is a partner of Piper Alderman Lawyers. He specialises in mining, commercial and securities law. He is also a qualifi ed mining engineer, with experience on a wide variety of mining projects. Greg is Chairman of ASX listed Core Exploration Ltd, a Director of West African Gold Limited and was a previous director of ASX listed Gawler Resources Ltd.

Greg’s experience in the mining industry, particularly in capital raising, tenement acquisition, project management and business development, and his industry knowledge and business relationships, enables Archer Exploration to manage and develop its existing tenement portfolio and to identify and secure other high quality exploration assets.

Special Responsibilities - Chairman

Gerard Anderson is a geologist with 39 years of experience including over 21 years in senior exploration and mine management roles including Exploration Superintendent at the Boddington Gold Mine for Worsley Alumina, Chief Geologist at Kalgoorlie Consolidated Mines, General Manager of Golden Grove zinc/copper/ lead operations for Normandy and Newmont. He was also General Manager Joint Ventures for Newmont, Managing Director of Croesus Mining NL and Managing Director of Centrex Metals Ltd (both ASX listed).

Alice McCleary is a Chartered Accountant. She is Chairman of UraniumSA Limited (ASX listed), a director of Benefund Ltd, Forestry Corporation of South Australia and Adelaide Community Healthcare Alliance Inc (ACHA), She is a Councillor of the South Australian Chamber of Mines and Energy (SACOME), a member of the International Ethics Standards Board for Accountants, and a member of the Corporations and Markets Advisory Committee (CAMAC).

Previous leadership roles include Deputy Chancellor of the University of South Australia and National President of the Taxation Institute of Australia. Alice’s professional interests include fi nancial management and corporate governance.

Special Responsibilities - Chair Audit & Risk Committee.

Craig Gooden was appointed Company Secretary on 16 February 2007 and performs the fi nancial/ accounting role in the Company as well as the secretarial duties. He has been a member of the Institute of Chartered Accountants in Australia since 1967 and has over 40 years experience in the resources industry.

Special Responsibilities - Managing Director. Member, Audit & Risk Committee.

Tom Phillips holds board positions with several not-forprofi t Organisations. Tom Chairs the Southern Adelaide Development Board and Flinders Partners Pty Ltd. He’s a former director of Australia Post.

Tom’s extensive experience in Australian industry and his knowledge of international business is a signifi cant asset to the Company.

Special Responsibilities - Member, Audit & Risk Committee.

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Directors’ Report

Service Agreements

The elements of the Directors and Group’s executives’ remuneration are set out in employment contracts as follows:

Gerard Anderson, Managing Director/CEO,

Archer Exploration Limited

Mr Anderson was appointed a non-executive Director of Archer in July 2008 and was appointed as Managing Director and Chief Executive Offi cer on 25 October 2010, on the following terms.

Contract term; Three years but may be terminated early by either party giving minimum 3 months notice.
Remuneration; $300,000 per annum plus 10% superannuation.
Bonuses; Discretionary up to 30% of salary each year and is determined with reference to key performance indictors as set by the Board annually. The 2013 Key Performance Indicators (KPI’s) include OH&S, project management, share price, investor relations and business development.
Termination payments; Calculated based on reason for termination, and limited to 3 months salary plus leave entitlements.

A new contract has been negotiated and commenced on 1 July 2013:

Contract term; Three years but may be terminated early by either party giving minimum 3 months notice.
Remuneration; $450,000 per annum plus 10% superannuation.
Short-term incentive bonus; Discretionary up to 20% of salary each year and is determined with reference to KPI’s as set by the Board annually.

Greg English, Chairman, Non-Executive DIrector

Archer Exploration Limited

Base remuneration.

Tom Phillips AM, Non-Executive Director, Archer Exploration Limited

Base remuneration.

Alice McCleary, Non-Executive Director, Archer Exploration Limited Base remuneration.

Wade Bollenhagen, Exploration Manager

Archer Exploration Limited

[• ][Contract Term; Permanent employee,]
Remuneration $170,000 per annum plus 9.25% superannuation and a discretionary bonus as approved by the Board.
Termination payments; Calculated based on reasons for termination from 4 weeks plus leave entitlements and up to 12 months salary plus leave entitlements if 50% of the Board resign or are replaced and the employee is directed to move permanently interstate and elects to terminate instead of moving.

David Lock PhD, Metallurgy Manager Archer Exploration Limited

[• ][Contract Term; Permanent employee,]
Remuneration; $170,000 per annum plus 9.25% superannuation and a discretionary bonus as approved by the Board. 75,000 share options issued on 2 Januray 2013.
Termination payments; Calculated based on reasons for termination from 4 weeks plus leave entitlements.
Long-term incentive bonus; Discretionary up to 15% of base salary per year payable in Company shares subject to shareholder approval and KPI’s including Company share price performance compared with the ASX Small Resources Index.
Termination payments; Calculated based on reason for termination, and limited to 3 months salary plus leave entitlements.

Directors’ Report

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Details of Key Management Personnel Remuneration for year ended 30 June 2013

The following table outlines persons who are key management personnel of the Company and the nature and amount of the elements of the remuneration of those persons.

*2013*	*Fixed Based Remuneration*	*Performance*	*Based*	*Remuneration*
			STI-Cash	Share based
Directors	Salary and commissions	Superannuation	bonus	payments - Options	Total
	$	$	$	$	$
Greg English*	68,807	6,193	-	-	75,000
Tom PhillipsAM	45,872	4,128	-	-	50,000
Alice McCleary	45,872	4,128	-	-	50,000
Gerard Anderson	300,000	38,100	81,000	17,982	437,082
Subtotal	460,551	52,549	81,000	17,982	612,082
Key Management Personnel
Craig Gooden	78,952	-	-	-	78,952
Wade Bollenhagen	170,000	16,667	15,300	-	201,967
David LockPhD	176,000	15,300	-	3,432	194,732
Total	885,503	84,516	96,300	21,414	1,087,733

In addition, Norman Waterhouse Lawyers were paid $23,325 (2012: 13,242) during the year for services rendered

to the Company. Mr English was a partner of Norman Waterhouse Lawyers until 1 July 2013. The fees were at normal commercial rates and negotiated at arms length.

The fair value of the options issued to key management personnel has been determined using an approved valuation methodology. Refer Note 20.

The percentage of remuneration received as share based payments were: Gerard Anderson 4.1%

David Lock 1.7%

Details of Key Management Personnel Remuneration for year ended 30 June 2012

The following table outlines persons who are key management personnel of the Company and the nature and amount of the elements of the remuneration of those persons.

*2012*	*Fixed Based Remuneration*	*Performance*	*Based*	*Remuneration*
			STI-Cash	Share	based
Directors	Salary and commissions	Superannuation	bonus	payments - Options		Total
	$	$	$		$	$
Greg English*	60,398	5,436	-		-	65,834
Tom PhillipsAM	37,462	3,372	-		-	40,834
Alice McCleary	37,462	3,372	-		-	40,834
Gerard Anderson	300,000	34,745	47,444	42,725		424,914
John DawkinsAO**	33,639	3,027	-		-	36,666
Peter Meers**	33,639	3,027	-		-	36,666
Subtotal	502,600	52,979	47,444	42,725		645,748
Key Management Personnel
Craig Gooden	75,037	-	-		-	75,037
David LockPhD	6,538	588	-		-	7,126
Wade Bollenhagen	170,000	15,300	11,697		-	196,997
Total	754,175	68,867	59,141	42,725		924,908

In addition, Norman Waterhouse Lawyers were paid $13,242 (2011: $24,318) during the year for services rendered

to the Company. Mr English is a partner of Norman Waterhouse Lawyers during the year. The fees were at normal commercial rates and negotiated at arms length.

** John Dawkins AO and Peter Meers resigned on 31 May 2012 and 25 May 2012 respectively.

The percentage of remuneration received as share based payments were: Mr Gerard Anderson 10.1%

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Directors’ Report

Key Management Personnel Compensation

Options Granted as Compensation

75,000 options were granted during the year as compensation; (2012: Nil). The amounts expensed during the year reflect the vesting conditions of prior option issues. No options were exercised during the year which were granted as compensation in prior periods. (2012: 140,000).

Options issued as part of Remuneration to Directors or Key Management Personnel for the year ended 30 June 2013

75,000 options were issued during the year. (2012: Nil).

The 75,000 options issued to an employee on 2 January 2013 had an exercise price of 28 cents and expiry date of 2 January 2015. The fair value of these options was $4,275.

The inputs utilised in determining the fair value of options is outlined in Note 21 to the Financial Statements. No options previously granted as compensation in prior periods have been exercised.

Shares issued as part of Remuneration to Directors or Key Management Personnel for the year ended 30 June 2013

No shares were issued to Directors or Key Management Personnel as part of their remuneration during the year.

Number of Unlisted Options held by Directors and Key Management Personnel

Key Management	Balance	Granted as	Options	Net other	Balance	Total	Total	Total
Personnel	1/07/12	Compensation	Exercised	Changes	30/06/13	vested	exercisable	unexercisable
Gerard Anderson	5,000,000	-	-	-	5,000,000	4,000,000	4,000,000	1,000,000
David LockPhD	-	75,000	-	-	75,000	25,000	25,000	50,000
Total	5,000,000	75,000	-	-	5,075,000	4,025,000	4,025,000	1,050,000

Shareholdings - Number of shares held by Directors and Key Management Personnel

Key Management	Balance on	Received as	Options	Net Other	Balance
Person	1/7/12	Compensation	Exercised	Change	30/06/13
Greg English	11,951,644	-	-	(3,000,000)	8,951,644
Tom PhillipsAM	1,110,346	-	-	-	1,110,346
Alice McCleary	2,073,264	-	-	-	2,073,264
Gerard Anderson	50,000	-	-	-	50,000
Craig Gooden	985,346	-	-	-	985,346
Wade Bollenhagen	240,000	-	-	-	240,000
David LockPhD	-	-	-	-	-
Total	16,410,600	-	-	(3,000,000)	13,410,600

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Directors’ Report

Employment contract of the

Managing Director, Exploration Manager and Manager Metallurgy

Name	Position	Duration of	Period of	Termination Payment
		Contract	Termination	provided for under
			Notice	the contract
Gerard Anderson	MD/CEO	36 Months (1)	Immediate (4)	3 months
Wade Bollenhagen	Exploration Manager	No f xed term (2)	Immediate (4)	4 weeks
David LockPhD	Manager Metallurgy	No f xed term (3)	Immediate (4)	4 weeks

Note 1) Contract commenced 1 July 2013

2) Contracted permanent employee with no fi xed term.
3) Contracted permanent employee with no fi xed term.

4) For termination with good cause.

Meetings of Directors

During the fi nancial year, 10 meetings of the Board of Directors were held. Attendances by each Director were as follows:

Name	Number of Directors	Number of Directors
	meetings whilst a Director
	Held	Attended
Greg English	10	10
Tom PhillipsAM	10	10
Alice McCleary	10	10
Gerard Anderson	10	10

Two meetings of the Audit & Risk Committee were held during the year. The members being Alice McCleary as Chair, Gerard Anderson and Tom Phillips all attended both meetings. In addition, Directors Greg English also attended one meeting by invitation. The Company has not formed a Remuneration Committee, or a Corporate Governance Committee. The Board as a whole considers these matters. The Board considers this appropriate given the size and nature of the Company at this time.

Indemnifying Offi cers or Auditor

The Company’s Constitution provides that the Company indemnifi es, on a full indemnity basis and to the full extent permitted by law, offi cers of the Company for all losses or liabilities incurred by the person as an offi cer of the Company or a related body corporate. In conformity with the Constitution, the Company is party to Deeds of Indemnity in favour of each of the Directors referred to in this report who held offi ce during the year.

The Company has paid premiums to insure each of the directors, offi cers and consultants against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity of director or executive of the company, other than conduct involving wilful breach of duty or a lack of good faith in relation to the company. The policy does not specify the individual premium for each offi cer covered and the amount paid is confi dential. Since the end of the year the Company has paid, or agreed to pay, premiums in respect of such contracts for the year ending 30 June 2014.

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Directors’ Report

Options

The following options are unexercised at the date of

this Annual Report:

Grant Date	Option Type	Number of shares	Exercise Price	Expiry Date
		subject to Options
3 December 2010	Unlisted	5,000,000	$0.20	30 November 2013
30 October 2012	Unlisted	1,500,0000	$0.40	1 April 2014
19 December 2012	Unlisted	1,500,000	$0.40	1 April 2014
2 January 2013	Unlisted	75,000	$0.28	2 January 2015

No person entitled to exercise an employee option had or has any right by virtue of the option to participate in any share issue of any other body corporate.

Proceedings on Behalf of Company

As far as the Directors’ are aware, no person has applied to the Court for leave to bring proceedings on behalf of the Company or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year.

Non-Audit Services

The Board of Directors is satisfi ed that the provision of the non audit services during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfi ed that the services disclosed below did not compromise the external auditor’s independence for the following reasons:

Auditor’s Independence Declaration

The lead auditor’s independence for the year ended 30 June 2013 has been received and can be found on page 59 of the Financial Report.

Signed in accordance with a resolution of the Board of Directors

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Greg English Chairman

Adelaide

Dated this 10[th] day of September 2013

all non-audit services are reviewed and approved by the board prior to commencement to ensure they do not adversely affect the integrity and objectivity of the auditor; and
the nature of the services provided do not compromise the general principles relating to auditor independence in accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.

The following fees for non-audit services were paid to the external auditors during the year ended 30 June 2013:

Taxation services $12,400

Auditor’s Independence Declaration

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Level 1, 67 Greenhill Rd Wayville SA 5034 GPO Box 1270 Adelaide SA 5001 T 61 8 8372 6666 F 61 8 8372 6677 E [email protected] W www.grantthornton.com.au

AUDITOR’S INDEPENDENCE DECLARATION TO THE DIRECTORS OF ARCHER EXPLORATION LIMITED

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Archer Exploration Limited for the year ended 30 June 2013, I declare that, to the best of my knowledge and belief, there have been:

a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
b no contraventions of any applicable code of professional conduct in relation to the audit.

GRANT THORNTON AUDIT PTY LTD Chartered Accountants

S J Gray Director – Audit & Assurance

Adelaide, 10 September 2013

Grant Thornton Audit Pty Ltd ACN 130 913 594

a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

Our Ref: Archer Exploration Limited_Jun 13.Docx

5 9

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Corporate Goverance Statement

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Corporate Goverance Statement

A copy of the Company’s Corporate Governance Manual and its Code of Conduct and Ethics may be found on the company’s website, at:

www.archerexploration.com.au

These documents set out the principles of corporate governance which the Board, and all employees, are obliged to comply with:

Principle 1: Laying Solid Foundations for management and oversight

The Company’s Corporate Governance Manual sets out the matters reserved for the Board’s decision.

The board has established delegations to senior executives so that their authority and duties are clear. These relate to expenditure approvals, day-to-day decision-making, routine ASX disclosures, review of potential projects, OH&S, staffi ng, promotion of the Company and Board reporting. Details are set out in the Company’s Corporate Governance Manual.

We also advise that a formal performance appraisal of the Chairman was carried out by the Board in accordance with our published policy. In addition, the Chairman reviewed the performance of the Board and other key executives in accordance with the policy.

Principle 2: Structuring the board to add value

The skills, experience and expertise relevant to the position of each director who is in offi ce at the date of the annual report, and their term of offi ce, are detailed in the directors’ report.

A majority of the non-executive directors of the company are independent:

Tom Phillips AM

The Corporate Governance Manual sets out the process for evaluating the effectiveness of the Board. The Board has followed this process in the 2013 year.

Board members are permitted to obtain independent professional advice at the expense of the Company, as set out in the Corporate Governance Manual.

Principle 3: Promote ethical and responsible decision-making

The company’s Code of Conduct and Ethics establishes the practices directors and staff must follow to comply with the law, meet stakeholder expectations, maintain confi dence in the Company’s integrity and report unethical practices.

The Company has not established a specifi c policy on diversity due to the current size of the Company and its operations. Directors and Management are selected based on skills, experience and expertise relevant to the required position. At 30 June 2013, the Company reports that 25% of the Board were women.

Principle 4: Safeguarding integrity in fi nancial reporting

An Audit and Risk Committee was established in 2011 and a formal charter has been approved. The Chair of the committee is director Alice McCleary with directors Tom Phillips and Gerard Anderson as members. All directors are given notice of meetings and are free to attend.

The Company selects its external auditor on a merit basis and is currently satisfi ed with the audit services being provided. Given the short period of the Company’s existence, it has not yet had cause to consider auditor rotation or re-selection processes, but will base any such decisions on competency, independence and value for money.

Alice McCleary

Each holds less than 5% of the issued capital of the Company, and has no current or recent material business relationship with the Company other than as a director. The Chairman of the Company, Mr. Greg English, is a substantial shareholder and holds more than 5% of the issued capital of the Company.

The Company does not have a separate Nomination Committee. However, the Board considers the composition, size and skills of the Board as part of its Board evaluation process, when selecting and appointing new directors, and at other relevant times, and considers that it does not presently require a Nomination Committee given the present size of both the Company and the Board.

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Corporate Goverance Statement

Principle 5: Making timely and balanced disclosure

The Company’s procedures for ensuring timely ASX disclosure are set out in the Corporate Governance Manual. The CEO and Company Secretary have day-to-day responsibility for compliance with ASX Listing Rules. All strategic disclosures to the ASX are approved by the Board. The functions of Competent Person for the purposes of the JORC code are performed by the Exploration Manager, Mr Wade Bollenhagen.

Principle 6: Respecting the rights of shareholders

The Company’s shareholder communication policy is set out in the Corporate Governance Manual. The Company relies principally on ASX disclosure and AGM meeting notices to communicate with shareholders which are considered adequate at this of the Company’s development. The Company uses electronic communications effectively.

Principle 7: Recognising and managing risk

The Company’s risk management polices are outlined in the Corporate Governance Manual. The Company has comprehensive policies in place to manage fi nancial and operational risk, and these are being further developed and expanded as the Company’s operations expand. The effectiveness of management of these risks is reported upon to the Board each month. Broader corporate risks are reviewed by the Board as a whole on an ongoing basis, and risk minimization strategies such as insurance are in place. The Board has conducted a formal risk assessment of its activities.

Principle 8: Remunerate fairly and responsibly

The Company does not have a separate remuneration committee due to the current size of the company and its operations. The Board as a whole has responsibility for the functions of a remuneration committee, including the performance evaluation and remuneration of the Managing

The amount of remuneration for all directors and executives, including all monetary and non-monetary components, is detailed in the directors’ report. All remuneration is valued in accordance with accounting standards to the Company and expensed. There are no schemes for retirement benefi ts for non-executive directors other than statutory superannuation.

The Company seeks to remunerate employees fairly in accordance with industry benchmarks and individual performance. Contracts of employment with senior executives may include base salary, superannuation and provision of a motor vehicle. The contracts allow for annual performance and remuneration reviews. All employees are also entitled to participate in the Company’s employee share option plan. Employees are not permitted to use margin lending or similar facilities in relation to their shares in the Company.

In relation to fi nancial risks, the Company has internal controls in place and these are audited as part of the external audit function. The Company also received formal assurances from the Managing Director and Company Secretary as to the effectiveness of the Company’s risk management and internal control environment, as required by s295A of the Corporations Act.

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Financial Information

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STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 30 JUNE 2013

The accompanying notes form part of the f nancial statements. *FOR THE YEAR ENDED 30 JUNE 2013* Notes Revenues from ordinary activities 2 Gain on sale of West Roxby 2 Depreciation and amortisation expenses Impairment-exploration assets Employee benefits expense Finance costs Occupancy expense Consultants expense ASX listing and registry expense Other corporate expenses from ordinary activities Profit/(loss) before income tax Income tax benefit 3 Profit/(loss) for year Profit/(loss) attributable to members of the parent entity Other comprehensive income Total comprehensive income for the year Total comprehensive income for the year attributable to members of the parent entity Earnings per Share Basic profit/(loss) per share 6 Diluted profit/(loss) per share 6	Consolidated Group 2013 2012 $ $	Consolidated Group 2013 2012 $ $
	2013 $
	546,583 - (14,926) 1,624 (675,707) - (48,200) (93,741) (63,731) (334,077)	161,044 4,403,877 (17,479) (191,338) (575,618) (45) (27,544) (86,629) (85,283) (235,333) 3,345,652 41,626 3,387,278 3,387,278 - 3,387,278 3,387,278 Cents 4.8 4.8
	(682,175) 322,594
	(359,581)
	(359,581)
	-
	(359,581)
	(359,581)
	Cents
	(0.4) (0.4)

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STATEMENT of FINANCIAL POSITION

AS AT 30 JUNE 2013

The accompanying notes form part of the f nancial statements. Notes ASSETS CURRENT ASSETS Cash and cash equivalents 7 Trade and other receivables 8 Total Current Assets NON-CURRENT ASSETS Property, plant and equipment 10 Exploration and evaluation expenditure 11 Total Non-current Assets TOTAL ASSETS CURRENT LIABILITIES Trade and other payables 12 Short-term provisions 13 TOTAL CURRENT LIABILITIES NON CURRENT LIABILITIES Long-term provisions 13 TOTAL NON CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital 14 Reserves 15 Retained earnings TOTAL EQUITY	Consolidated Group Parent Entity 2013 2012 $ $ $ $	Consolidated Group Parent Entity 2013 2012 $ $ $ $
	2013 $
	8,555,649 90,705	12,752,896 319,189 13,072,085 123,196 3,501,119 3,624,315 16,696,400 339,591 106,237 445,828 22,225 22,225 468,053 16,228,347 15,528,408 238,787 461,152 16,228,347
	8,646,354
	1,365,787 6,421,739
	7,787,526
	16,433,880
	304,937 160,129
	465,066
	29,134
	29,134
	494,200
	15,939,680
	15,456,408 381,701 101,571
	15,939,680

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STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2013

Consolidated Group Balance at 1 July 2011 Fair value of options issued Shares issued net of cost and tax Listed shares options exercised Total comprehensive income for year Balance at 30 June 2012 Shares issued net of cost and tax Fair value of options issued Total comprehensive income for year Balance at 30 June 2013	Issued Retained Share Option Capital Earnings Reserve $ $ $ 10,699,698 (2,926,126) 196,062 - - 42,725 4,808,910 - - 19,800 - - - 3,387,278 -	Issued Retained Share Option Capital Earnings Reserve $ $ $	Total $
			7,969,634 42,725 4,808,910 19,800 3,387,278 16,228,347 (72,000) 142,914 (359,581) 15,939,680
	15,528,408 461,152 238,787
	(72,000) - - - - 142,914 - (359,581) -
	15,456,408 101,571 381,701

The accompanying notes form part of the fi nancial statements.

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STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 30 JUNE 2013

The accompanying notes form part of the f nancial statements. Consolidated Group 2013 2012 Notes $ $ $ CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees (1,133,242) (956,086) Interest received 555,968 151,659 Research & Development concessional tax refund 322,594 112,808 Finance costs - (45) NET CASH (USED IN) OPERATING ACTIVITIES 19 (254,680) (691,664) CASH FLOWS FROM INVESTING ACTIVITIES Payments for exploration expenditure (2,678,661) (1,633,744) Receipts from sale of West Roxby - 8,000,000 Payments for land & buildings (1,227,473) - Payments for plant and equipment (36,433) (51,707) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (3,942,567) 6,314,549) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the issues of ordinary shares - 4,694,800 Costs of share capital raising - (237,275) Repayment of borrowings - (1,690) NET CASH PROVIDED BY FINANCING ACTIVITIES - 4,455,835 Net (decrease)/increase in cash held (4,197,247) 10,078,720 Cash at the beginning of the financial year 12,752,896 2,674,176 Cash at the end of the financial year 7 8,555,64912,752,896	The accompanying notes form part of the f nancial statements. Consolidated Group 2013 2012 Notes $ $ $ CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees (1,133,242) (956,086) Interest received 555,968 151,659 Research & Development concessional tax refund 322,594 112,808 Finance costs - (45) NET CASH (USED IN) OPERATING ACTIVITIES 19 (254,680) (691,664) CASH FLOWS FROM INVESTING ACTIVITIES Payments for exploration expenditure (2,678,661) (1,633,744) Receipts from sale of West Roxby - 8,000,000 Payments for land & buildings (1,227,473) - Payments for plant and equipment (36,433) (51,707) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (3,942,567) 6,314,549) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the issues of ordinary shares - 4,694,800 Costs of share capital raising - (237,275) Repayment of borrowings - (1,690) NET CASH PROVIDED BY FINANCING ACTIVITIES - 4,455,835 Net (decrease)/increase in cash held (4,197,247) 10,078,720 Cash at the beginning of the financial year 12,752,896 2,674,176 Cash at the end of the financial year 7 8,555,64912,752,896	The accompanying notes form part of the f nancial statements. Consolidated Group 2013 2012 Notes $ $ $ CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees (1,133,242) (956,086) Interest received 555,968 151,659 Research & Development concessional tax refund 322,594 112,808 Finance costs - (45) NET CASH (USED IN) OPERATING ACTIVITIES 19 (254,680) (691,664) CASH FLOWS FROM INVESTING ACTIVITIES Payments for exploration expenditure (2,678,661) (1,633,744) Receipts from sale of West Roxby - 8,000,000 Payments for land & buildings (1,227,473) - Payments for plant and equipment (36,433) (51,707) NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (3,942,567) 6,314,549) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the issues of ordinary shares - 4,694,800 Costs of share capital raising - (237,275) Repayment of borrowings - (1,690) NET CASH PROVIDED BY FINANCING ACTIVITIES - 4,455,835 Net (decrease)/increase in cash held (4,197,247) 10,078,720 Cash at the beginning of the financial year 12,752,896 2,674,176 Cash at the end of the financial year 7 8,555,64912,752,896

	2013 $
	(1,133,242) 555,968 322,594 -	(956,086) 151,659 112,808 (45) (691,664) (1,633,744) 8,000,000 - (51,707) 6,314,549) 4,694,800 (237,275) (1,690) 4,455,835 10,078,720 2,674,176 12,752,896
	(254,680)
	(2,678,661) - (1,227,473) (36,433)
	(3,942,567)
	- - -
	-
	(4,197,247)
	12,752,896
	8,555,649

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NOTE 1 – STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The financial report includes the consolidated financial statements and notes of Archer Exploration Limited and controlled entities (‘Consolidated’ or ‘Group’).

Basis of Preparation

The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the Corporations Act 2001.

Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions to which they apply. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below. They have been consistently applied unless otherwise stated.

The financial report has been prepared on an accruals basis and is based on historical costs modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

a) Principles of Consolidation

A controlled entity is any entity over which Archer Exploration Limited has the power to govern the financial and operating policies so as to obtain benefits from its activities. In assessing the power to govern, the existence and effect of holdings of actual and potential voting rights are considered.

A list of controlled entities is contained in Note 9 to the financial statements.

As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial statements as well as their results for the year then ended. Where controlled entities have entered (left) the consolidated group during the year, their operating results have been included/(excluded) from the date control was obtained/(ceased).

All inter-group balances and transactions between entities in the consolidated group, including any recognised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed, where necessary, to ensure consistency with those adopted by the parent entity.

Business Combinations

Business combinations occur where control over another business is obtained and results in the consolidation of its assets and liabilities. All business combinations, including those involving entities under common control, are accounted for by applying the purchase method.

The acquisition method requires an acquirer of the business to be identified and for the cost of the acquisition and fair values of identifiable assets, liabilities and contingent liabilities to be determined at acquisition date, being the date that control is obtained. Cost is determined as the aggregate of fair values of assets given, equity issued and liabilities assumed in exchange for control together with costs directly attributable to the business combination. Any deferred consideration payable is discounted to present value using the equity’s incremental borrowing rate.

Goodwill is recognised initially at the excess of cost over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. If the fair value of the acquirer’s interest is greater than cost, the surplus is immediately recognised in profit or loss.

b) Income Tax

The income tax expense/(revenue) for the year comprises current income tax expense/(income) and deferred tax expense/(income).

Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as at reporting date. Current tax liabilities/(assets) aretherefore measured at the amounts expected to be paid to/(recovered from) the relevant taxation authority.

Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well as unused tax losses. Current and deferred income tax expense/(income) is charged or credited directly to equity instead of the profit or loss when the tax relates to items that are credited or charged directly to equity.

Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.

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NOTE 1 – STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued

Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset recognised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability.

Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised.

Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.

Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.

Tax Consolidation

Archer Exploration Limited and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under tax consolidation legislation. The Group notified the Australian Tax Office that it had formed an income tax consolidated group to apply from 1 July 2007. The tax consolidated group has entered a tax funding arrangement whereby each company in the group contributed to the income tax payable by the group in proportion to their contribution to the Group’s taxable income. Differences between the amounts of net tax assets and liabilities recognised and the net amounts recognised pursuant to the funding arrangement are recognised as either a contribution by, or distribution to the head entity.

c) Property, Plant and Equipment

Property, plant and equipment is carried at cost less where applicable, any accumulated depreciation and impairment losses.

The carrying amount of property, plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the assets employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the Statement of Profit or Loss and Other Comprehensive Income during the financial period in which are they are incurred.

Depreciation

The depreciable amount of all fixed assets are depreciated on a straight-line basis over their useful lives to the consolidated entity commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements. The depreciation rates used for each class of depreciable assets are:

Class of Non Current Asset	Depreciation Rate	Basis of Depreciation Straight Line Straight Line
Plant and Equipment Buildings	10 – 33% 2%

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the Statement of Profit or Loss and Other Comprehensive Income.

d) Exploration and Evaluation Expenditure

Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.

Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the decision to abandon the area is made.

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NOTE 1 – STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued

Where a decision is made to proceed with development the accumulated costs for the relevant area of interest will be amortised over the life of the area according to the rate of depletion of the economically recoverable reserves. A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest.

Costs of site restoration are provided over the life of the facility from when exploration commences and are included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant, equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of the mining permits. Such costs have been determined using estimates of future costs, current legal requirements and technology on an undiscounted basis.

Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations and future legislation. Accordingly the costs have been determined on the basis that the restoration will be completed within one year of abandoning the site.

e) Leases

Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but not the legal ownership that are transferred to entities in the consolidated Group, are classified as finance leases.

Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of the leased property or the present value of the minimum lease payments, including any guaranteed residual values. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.

Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives the lease term. Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses in the periods in which they are incurred.

a party to the contractual provisions of the instrument. Trade date accounting is adopted for financial assets that are delivered within timeframes established by marketplace convention.

Financial instruments are initially measured at fair value plus transactions costs where the instrument is not classified as at fair value through profit or loss. Transactions costs related instruments classified as at fair value through profit or loss are expensed to profit or loss immediately. Financial instruments are classified and measured as set out below.

Derecognition

Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire. The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

Classification and Subsequent Measurement

i) Financial assets at fair value through profit or loss

Financial assets are classified at fair value through profit or loss when they are held for trading for the purpose of short term profit taking, where they are derivatives not held for hedging purposes, or designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Realised and unrealised gains and losses arising from changes in fair value are included in profit or loss in the period in which they arise.

ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost using the effective interest rate method.

iii) Held-to-maturity investments

Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over the life of the lease term.

f) Financial Instruments

Recognition and Initial Measurement

Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the Group’s intention to hold these investments to maturity. They are subsequently measured at amortised cost using the effective interest rate method.

Financial instruments, incorporating financial assets and financial liabilities, are recognised when the entity becomes

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NOTE 1 – STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued

iv) Available-for-sale financial assets

Available-for-sale financial assets are non-derivative financial assets that are either designated as such or that are not classified in any of the other categories. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed determinable payments.

v) Financial liabilities

Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost using the effective interest rate method.

g) Impairment of Assets

At each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the Statement of Profit or Loss and Other Comprehensive Income.

Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

h) Interests in Joint Venture

The Consolidated Group’s share of assets, liabilities, revenue and expenses of the joint venture operations are included in the appropriate items of the Consolidated Financial Statements. Details of the Consolidated Group’s interest is shown in Note 16.

element over the exercise price of the employees services rendered in exchange for the grant of shares and options is recognised as an expense in the Statement of Profit or Loss and Other Comprehensive Income. The total amount to be expensed over the vesting period is determined by reference to the fair value of the shares or the option granted.

j) Provisions

Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

k) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the Statement of Financial Position.

l) Revenue

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

Revenue from the rendering of a service is recognised upon the delivery of the service to the customers. All revenue is stated net of the amount of goods and services tax (GST).

m) Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in income in the period in which they are incurred.

l) Employee Benefits

n) Goods and Services Tax (GST)

Provision is made for the company’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for these benefits. Those cashflows are discounted using market yields on national government bonds with terms to maturity that match the expected timing of cashflows.

Equity - Settled Compensation

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST.

Cash flows are presented in the Statement of Cash Flows on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

The Group has an employee share option plan. The bonus

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NOTE 1 – STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued

o) Comparative Figures

When required by accounting standards, comparative figures have been adjusted to conform to changes in presentation of the current financial year.

p) Critical Accounting Estimates and Judgments

The Directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data obtained both externally and within the Group.

Key estimates

Impairment

The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value–in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates.

Impairment was recognised in respect of non-current assets for the year ended 30 June 2013 $1,624 recovered (2012: $191,388).

Exploration and evaluation

The consolidated entity’s policy for exploration and evaluation is discussed at note 1(d). The application of this policy requires the directors to make certain estimates and assumptions as to future events and circumstances. Any such estimates and assumptions may change as new information becomes available. If, after having capitalised exploration and evaluation expenditure, the directors conclude that the capitalised expenditure is unlikely to be recovered by future sale or exploitation, then the relevant capitalised amount will be written off though the Statement of Profit or Loss and Other Comprehensive Income.

q) Carbon tax

At the date of this report the Carbon Tax legislation has passed through parliament, and the commencement date for the scheme was 1 July 2012. As the Group does not fall within the ‘Top 500 Australian Polluters’, the impact of the Carbon Scheme will be through indirect effects of increased prices on many production inputs and general business expenses as suppliers subject to the carbon pricing mechanism are likely to pass on their carbon price burden to their customers in the form of increased prices. Directors expect that this will not have a significant

impact upon the operating costs within the business, and therefore will not have an impact upon the valuation of assets and/or going concern of the business.

r) Adoption of New and Revised Accounting Standards

During the current year the Group adopted all of the new and revised Australia Accounting Standards and Interpretations applicable to its operations which became mandatory.

Standards, amendments and interpretations to existing standards that are not yet effective and have not been adopted early by the Group:

At the date of authorisation of these financial statements, certain new standards, amendments and interpretations to existing standards have been published but are not yet effective, and have not been adopted early by the Group.

Management anticipates that all of the relevant pronouncements will be adopted in the Group’s accounting policies for the first period beginning after the effective date of the pronouncement. Information on new standards, amendments and interpretations that are expected to be relevant to the Group’s financial statements is provided below.

Certain other new standards and interpretations have been issued but are not expected to have a material impact on the Group’s financial statements.

Changes in accounting policies

New and amended standards adopted by the Group

AASB 2010-8 Amendments to Australian Accounting Standard – Deferred Tax: Recovery of Underlying Assets (Applies to annual reporting periods beginning on or after 1 January 2012)

AASB 2010-8 provides clarification on the determination of deferred tax assets and deferred tax liabilities when investment properties are measured using the fair value model in AASB 140 Investment Properties . It introduces a rebuttable presumption that an investment property is recovered entirely through sale. This presumption is rebutted if the investment property is held within a business model where the objective is to consume substantially all of the economic benefits embodied in the investment property over time, rather than through sale.

AASB 2010-8 also includes the requirement that the measurement of deferred tax assets and deferred tax liabilities on non-depreciable assets measured using the revaluation model in AASB 116 Property, Plant and Equipment should always be based on recovery through sale.

These amendments have had no impact on the Group.

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NOTE 1 – STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued

AASB 2011-9 Amendments to Australian Accounting Standards – Presentation of Items of Other Comprehensive Income (Applies annual reporting periods beginning on or after 1 July 2012)

AASB 2011-9 requires entities to group items presented in Other Comprehensive Income on the basis of whether they are potentially re-classifiable to profit or loss subsequently, and changes the title of ‘statement of comprehensive income’ to ‘statement of profit or loss and other comprehensive income’.

The adoption of the new and revised Australian Accounting Standards and Interpretations has had no significant impact on the Group accounting policies or the amounts reported during the current half-year period. The adoption of AASB 2011-9 has resulted in changes to the Group presentation of its financial statements.

Accounting standards issued but not yet effective and not been adopted early by the Group

The Group notes the following Accounting Standards which have been issued but are not yet effective at 30 June 2013. These standards have not been adopted early by the Group. The Group assessment of the impact of these new standards and interpretations is set out below:

(i) AASB 9 Financial Instruments, AASB 2009-11 Amendments to Australian Accounting Standards arising from AASB 9, AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) and AASB 2012-6 Amendments to Australian Accounting Standards – Mandatory Effective Date of AASB 9 and Transition Disclosures (effective from 1 January 2015)

AASB 9 introduces new requirements for the classification and measurement of financial assets and liabilities.

These requirements improve and simplify the approach for classification and measurement of financial assets compared with the requirements of AASB 139. The main changes are:

Financial assets that are debt instruments will be classified based on (1) the objective of the entity’s business model for managing the financial assets; and (2) the characteristics of the contractual cash flows.
Allows an irrevocable election on initial recognition to present gains and losses on investments in equity instruments that are not held for trading in other comprehensive income (instead of in profit or loss).
Dividends in respect of these investments that are a return on investment can be recognised in profit or loss and there is no impairment or recycling on disposal of the instrument.
Financial assets can be designated and measured at fair value through profit or loss at initial recognition if doing so eliminates or significantly reduces a measurement or recognition inconsistency that would arise from measuring assets or liabilities, or recognising the gains and losses on them, on different bases.
Where the fair value option is used for financial liabilities the change in fair value is to be accounted for as follows;
The change attributable to changes in credit risk are presented in other comprehensive income (OCI) and;
The remaining change is presented in profit or loss.

There will be no impact on the Group accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at fair value through profit or loss and the Group does not have any such liabilities. The de-recognition rules have been transferred from AASB 139 Financial Instruments: Recognition and Measurement and have not been changed. The Group has not yet decided when to adopt AASB 9.

(ii) AASB 10 Consolidated Financial Statements, AASB 11 Joint Arrangements, AASB 12 Disclosure of Interests in Other Entities, revised AASB 127 Separate Financial Statements, AASB 128 Investments in Associates and Joint Ventures, AASB 2011-7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards and AASB 2012-10 Amendments to Australian Accounting Standards – Transition Guidance and Other Amendments (effective 1 January 2013)
AASB 10 replaces all of the guidance on control and consolidation in AASB 127 Consolidated and Separate Financial Statements, and Interpretation 12 Consolidation – Special Purpose Entities.
The core principle that a consolidated entity presents a parent and its subsidiaries as if they are a single economic entity remains unchanged, as do the mechanics of consolidation. However, the standard introduces a single definition of control that applies to all entities. It focuses on the need to have both power and rights or exposure to variable returns. Power is the current ability to direct the activities that significantly influence returns. Returns must vary and can be positive, negative or both. Control exists when the investor can use its power to affect the amount of its returns.

When this standard is first adopted for the year ended 30 June 2014, there will be no impact on the transactions and balances recognised in the financial statements.

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NOTE 1 – STATEMENT OF SIGNIFICANT

ACCOUNTING POLICIES continued

AASB 11 replaces AASB 131 Interests in Joint Ventures and AASB Interpretation 113 Jointly-controlled Entities – Non-monetary Contributions by Ventures. AASB 11 uses the principle of control in AASB 10 to define joint control, and therefore the determination of whether joint control exists may change.
In addition, AASB 11 removes the option to account for jointly-controlled entities using proportionate consolidation. Instead, accounting for a joint arrangement is dependent on the nature of the rights and obligations arising from the arrangement. Joint operations that give the venturers a right to the underlying assets and obligations for liabilities are accounted for by recognising the share of those assets and liabilities. Joint ventures that give the venturers a right to the net assets are accounted for using the equity method.

When this standard is first adopted for the year ended 30 June 2014, there will be no impact on transactions and balances recognised in the financial statements because the Group has not entered into any joint arrangements.

AASB 12 sets out the required disclosures for entities reporting under the two new standards, AASB 10 and AASB 11, and replaces the disclosure requirements currently found in AASB 127 and AASB 128. Application of this standard by the Group will not affect any of the amounts recognised in the financial statements, but will impact the type of information disclosed in relation to the Group investments.
Amendments to AASB 128 provide clarification that an entity continues to apply the equity method and does not remeasure its retained interest as part of ownership changes where a joint venture becomes an associate, and vice versa. The amendments also introduce a “partial disposal” concept.

When this standard is first adopted for the year ended 30 June 2014, there will be no impact on the transactions and balances recognised in the financial statements.

(iii) AASB 13 Fair Value Measurement and AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13 (effective 1 January 2013)

AASB 13 explains how to measure fair value and aims to enhance fair value disclosures. Application of the new

standard will impact the type of information disclosed in the notes to the financial statements.

The Group is yet to undertake a detailed analysis of the differences between the current fair valuation methodologies used and those required by AASB 13. However, when this standard is adopted for the first time for the year ended 30 June 2014, there will be no impact on the financial statements because the revised fair value measurement requirements apply prospectively from 1 January 2013.

(iv) Revised AASB 119 Employee Benefits and AASB 2011-10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011)

The AASB released a revised standard on accounting for employee benefits. It requires the recognition of all re-measurements of defined benefit liabilities/assets immediately in other comprehensive income (removal of the so-called ‘corridor’ method), the immediate recognition of all past service cost in profit or loss and the calculation of a net interest expense or income by applying the discount rate to the net defined benefit liability or asset. This replaces the expected return on plan assets that is currently included in profit or loss. The standard also introduces a number of additional disclosures for defined benefit liabilities/assets and could affect the timing of the recognition of termination benefits. The amendments will have to be implemented retrospectively.

The Group does not have any defined benefit plans. Therefore, these amendments will have no impact on the Group/Company/Scheme.

(v) AASB Interpretation 20 Stripping Costs in the Production Phase of Surface Mining

This interpretation clarifies that costs of removing mine waste materials (overburden) to gain access to mineral ore deposits during the production phase of a mine must be capitalised as inventories under AASB 102 Inventories, if the benefits from stripping activity is realised in the form of inventory produced. Otherwise, if stripping activity provides improved access to the ore, stripping costs must be capitalised as a non-current, (if certain recognition criteria are met, as an addition to, or enhancement of, an existing asset).

The Group does not operate a surface mine. Therefore, there will be no impact on the financial statements when this interpretation is first adopted for reporting periods commencing from 1 January 2013.

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(vi) AASB 2011-4 Amendments to Australian Accounting Standards to Remove Individual Key Management Personnel Disclosure Requirements

The Standard amends AASB 124 Related Party Disclosures to remove the individual key management personnel (KMP) disclosures required by Australian specific paragraphs. This amendment reflects the AASB’s view that these disclosures are more in the nature of governance disclosures that are better dealt within the legislation, rather than by the accounting standards.

When these amendments are first adopted for the year ending 30 June 2014, they are unlikely to have any significant impact on the Group.

(vii) AASB 2012-2 Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial Liabilities

This Standard amends the required disclosures in AASB 7 to include information that will enable users of an entity’s financial statements to evaluate the effect or potential effect of netting arrangements, including rights of set-off associated with the entity’s recognised financial assets and recognised financial liabilities, on the entity’s financial position.

This Standard also amends AASB 132 to refer to the additional disclosures added to AASB 7 by this Standard.

When this AASB 2012-2 is first adopted for the year ended 30 June 2014, there will be no impact on the Group/ Company/Scheme as the Group does not have any netting arrangements in place.

(viii) AASB 2012-3 Amendments to Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities

AASB 2012-3 adds application guidance to AASB 132 to address inconsistencies identified in applying some of the offsetting criteria of AASB 132, including clarifying the meaning of “currently has a legally enforceable right of set-off” and that some gross settlement systems may be considered equivalent to net settlement.

When these amendments are adopted for the first time on 1 January 2014, they are unlikely to have any significant impact on the Group given that they are largely of the nature of clarification of existing requirements.

(x) IFRIC Interpretation 21 Levies

IFRIC 21 addressed how an entity should account for liabilities to pay levies imposed by governments, other than income taxes, in its financial statements (in particular, when the entity should recognise a liability to pay a levy).

IFRIC 21 is an interpretation of IAS 37 Provisions, Contingent Liabilities and Contingent Assets. IAS 37 sets out criteria for the recognition of a liability, one of which is the requirement for the entity to have a present obligation as a result of a past event (known as an obligating event). The Interpretation clarifies that the obligating event that gives rise to a liability to pay a levy is the activity described in the relevant legislation that triggers the payment of the levy. For example, if the activity that triggers the payment of the levy is the generation of revenue in the current period and the calculation of that levy is based on the revenue that was generated in a previous period, the obligating event for that levy is the generation of revenue in the current period. The generation of revenue in the previous period is necessary, but not sufficient, to create a present obligation.

When this interpretation is adopted for the first time on 1 January 2014, there will be no significant impact on the financial statements as the Group is not subject any levies addressed by this interpretation.

There are no other standards that are not yet effective and that are expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions.

The financial report was authorised for issue on 10[th] September 2013 by the Board of Directors.

When AASB 2012-3 is first adopted for the year ended 30 June 2015, there will be no impact on the Group as this standard merely clarifies existing requirements in AASB 132.

(ix) Recoverable Amount Disclosures for Non-Financial Assets (Amendments to IAS 36)

These narrow-scope amendments address disclosure of information about the recoverable amount of impaired assets if that amount is based on fair value less costs of disposal.

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NOTE 2 – REVENUE Operating activities - Interest received Total Revenue Gain on sale of West Roxby prospect On 30 April 2012 the Group announced the sale of five tenements (West Roxby) to a subsidiary of BHP Billiton. The consideration for the sale was $8,000,000 and was received on 27 June 2012. The carrying value of the tenements was $3,596,123 resulting in the $4,403,877 gain on disposal. NOTE 3 – INCOME TAX BENEFIT a) The components of income tax benefit comprise: Current tax Deferred tax b) The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows 30% (2012 : 30%): Net profit/(loss) Prima facie tax benefit on loss from ordinary activities before income tax at 30% Add/(less): Tax effect of: - other non allowable Research and development tax concession Deferred tax assets assocaited with capital raising costs recognised direct to equity but not meeting the recognition criteria Tax effect of temporary differences not brought to account as they do not meet the recognition criteria Utilisation of previously unrecognised tax losses Income Tax attributable to operating loss c) Unused tax losses for which no deferred tax asset has been recognised at 30%		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $ 546,583 161,044 546,583 161,044 - 4,403,877 322,594 41,626 - - 322,594 41,626 (682,175) 3,345,652 (204,653) 1,003,696 - 12,818 (204,653) 1,016,514 322,594 112,808 - (71,182) 204,653 581,357 - (1,597,870) 322,594 41,626 1,447,202 566,338

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NOTE 4 – KEY MANAGEMENT PERSONNEL COMPENSATION

a) Names and positions held of consolidated entity key management personnel in office at any time during the financial year are:

Mr Greg English Chairman – Non-executive appointed 9 May 2007 Mr Tom Phillips AM Director – Non-executive appointed 16 February 2007 Ms Alice McCleary Director – Non-executive appointed 16 February 2007 Mr Gerard Anderson Director – Executive appointed 14 July 2008 Mr Craig Gooden Company Secretary appointed 16 February 2007 Mr Wade Bollenhagen Exploration Manager appointed 26 March 2008 Mr David Lock PhD Metallurgy Manager appointed 18 June 2012

Other than those employees of the company listed above there are no additional management personnel.

b) Key Management Personnel Compensation

Refer to the Remuneration Report contained in the Report of Director’s for details of the remuneration paid or payable to each member of the Group’s key management personnel (KMP) for the year ended 30 June 2013.

The total of remuneration paid to KMP of the Group during the year are as follows:

	2013	2012
Short term benefits	981,603	813,316
Post employment benefit	84,516	68,867
Share - based payments	21,414	42,275
	1,087,733	924,458

c) Options Granted as Compensation

75,000 options (2012: $Nil) were granted during the year to key management as compensation. The fair value of 2013 options was $4,275 (2012: Nil).

3,000,000 options (2012: Nil) were granted to contact consultants during the year with a fair value of $121,500 (2012: Nil)

No options were exercised during the year which were granted as compensation in prior periods and 1,000,000 options expired unexercised.

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NOTE 4 – KEY MANAGEMENT PERSONNEL COMPENSATION continued

d) Option Holdings Number of options held by Key Management Personnel

2013
Key Management	Balance	Granted as	Options	Options	Net other	Balance	Total	Total	Total
Personnel	1.07.12	compensation	exercised	expired	changes	30.06.13	Vested	Exercisable	Unexercisable
Mr Greg English	-	-	-	-	-	-	-	-	-
Mr Tom PhillipsAM	-	-	-	-	-	-	-	-	-
Ms Alice McCleary	-	-	-	-	-	-	-	-	-
Mr Gerard Anderson	5,000,000	-	-	-	-	5,000,000	4,000,000	4,000,000	1,000,000
Mr Craig Gooden	-	-	-	-	-	-	-	-	-
Mr Wade Bollenhagen	-	-	-	-	-	-	-	-	-
Mr David LockPhD	-	75,000	-	-	-	75,000	25,000	25,000	50,000
Total	5,000,000	75,000	-	-	-	5,075,000	4,025,000	4,025,000	1,050,000
2012
Key Management	Balance	Granted as	Options	Options	Net other	Balance	Total	Total	Total
Personnel	1.07.11	compensation	exercised	expired	changes	30.06.12	Vested	Exercisable	Unexercisable
Mr Greg English	-	-	-	-	-	-	-	-	-
Mr Tom PhillipsAM	-	-	-	-	-	-	-	-	-
Ms Alice McCleary	-	-	-	-	-	-	-	-	-
Mr Gerard Anderson	5,250,000	-	-	(250,000)	-	5,000,000	3,000,000	3,000,000	2,000,000
Mr Craig Gooden	-	-	-	-	-	-	-	-	-
Mr Wade Bollenhagen	140,000	-	(140,000)	-	-	-	-	-	-
Mr David LockPhD	-	-	-	-	-	-	-	-	-
Total	5,390,000	-	(140,000)	(250,000)	-	5,000,000	3,000,000	3,000,000	2,000,000

John Dawkins AO and Peter Meers resigned 31 May 2012 and 25 May 2012 respectively.

e) Shareholdings

Number of shares held by Key Management Personnel

2013

*2013*
Key Management	Balance	Received as	Options	Net Other	Balance
Personnel	1.7.12	Compensation	Exercised	Change	30.6.13
Mr Greg English	11,951,644	-	-	(3,000,000)	8,951,644
Mr Tom Phillips AM	1,110,346	-	-	-	1,110,346
Ms Alice McCleary	2,073,264	-	-	-	2,073,264
Mr Gerard Anderson	50,000	-	-	-	50,000
Mr Craig Gooden	985,346	-	-	-	985,346
Mr Wade Bollenhagen	240,000	-	-	-	240,000
Mr David LockPhD	-	-	-	-	-
Total	16,410,600	-	-	(3,000,000)	13,410,600

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NOTE 4 – KEY MANAGEMENT PERSONNEL COMPENSATION continued

e) Shareholdings continued

Number of shares held by Key Management Personnel

*2012* Key Management Personnel Mr Greg English Mr Tom PhillipsAM Ms Alice McCleary Mr Gerard Anderson Mr John DawkinsAO Mr Peter Meers Mr Craig Gooden Mr Wade Bollenhagen Mr David LockPhD Total	Balance 1.7.11 11,916,298 1,075,000 2,027,917 50,000 - - 950,000 175,000 - 16,194,215	Received as Compensation - - - - - - - - - -	Options Exercised - - - - - - - 140,000 - 140,000	Net Other Change 35,346 35,346 45,347 - - - 35,346 (75,000) - 76,385	Balance 30.6.12 11,951,644 1,110,346 2,073,264 50,000 - - 985,346 240,000 - 16,410,600

John Dawkins AO and Peter Meers resigned 31 May 2012 and 25 May 2012 respectively.

NOTE 5 – AUDITORS’ REMUNERATION Remuneration of the auditor for: - auditing or review of the financial report - other services provided by the practice of the auditor NOTE 6 – EARNINGS PER SHARE Reconciliation of earnings to Profit or Loss Profit/(loss) for year used to calculate basic EPS a) Weighted average number of ordinary shares outstanding during the year used in calculation of basic EPS b) Weighted average number of securities outstanding during the year used in the calculation of the diluted EPS		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $
		25,750 25,000 12,400 11,160 38,150 36,160 (359,581) 3,387,278 Number Number 82,362,763 70,160,223 89,685,263 70,344,854

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2008 $ NOTE 7 – CASH AND CASH EQUIVALENTS Short term deposits Cash at bank and on hand Total Cash at bank and on hand The effective interest rate on short term bank deposits was 4.59%. These deposits have an average maturity of 139 days. The Group’s exposure to interest rate risk is summarised at Note 24. NOTE 8 – TRADE AND OTHER RECEIVABLES CURRENT Prepayments Other receivables At 30 June 2013 the consolidated entity did not have any receivables which were outside normal trading terms (past due but not impaired).		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $ 8,537,389 12,728,479 18,260 24,417 8,555,649 12,752,896 10,921 224,279 79,784 94,910 90,705 319,189

NOTE 9 – INVESTMENTS IN CONTROLLED

ENTITIES		Percentage Owned
	Country of	2013	2012
	Incorporation	%	%
Parent Entity
- Archer Exploration Limited	Australia	-	-
Subsidiaries of Archer Exploration Limited:
- Pirie Resources Pty Ltd	Australia	100	100
- Archer Pastoral Company Pty Ltd*	Australia	100	100
- Leigh Creek Magnesite Pty Ltd	Australia	100	100
- Archer Energy & Resources Pty Ltd	Australia	100	100
- SA Exploration Pty Ltd	Australia	100	100

Formerly Kensington Exploration Pty Ltd

NOTE 10 – PROPERTY, PLANT AND EQUIPMENT

– , Q Plant and Equipment at cost Accumulated depreciation a) Movements in carrying amounts: Balance at the beginning of the year Additions Depreciation Balance at 30 June	269,687 233,254 (141,707) (110,058) 127,980 123,196 123,196 105,525 44,644 51,707 (39,860) (34,036) 127,980 123,196

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2008 $ NOTE 10 – PROPERTY, PLANT AND EQUIPMENT continued b) Land at cost Movements in carrying amounts: Balance at the beginning of the year Additions land Balance at 30 June c) Buildings at cost Depreciation Balance at 30 June Movements in carrying amounts: Balance at the beginning of the year Additions buildings Depreciation Balance at 30 June Total property, plant and equipment NOTE 11 – EXPLORATION AND EVALUATION EXPENDITURE Costs carried forward in respect of areas of interest in: Exploration and evaluation phase at cost a) Movements in carrying amounts: Exploration and evaluation Balance at the beginning of the year Cost of exploration licenses sold Amounts capitalised during the year Impairment recovered/(expense) during the year Balance at 30 June During the year $29,553 (2012: $16,557) of equipment depreciation was included in the amount capitalised as exploration and evaluation. A summary by tenement is included at_Note 16._		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $ 1,038,474 - - - 1,038,474 - 1,038,474 - 200,000 - (667) - 199,333 - - - 200,000 (667) - 199,333 - 1,365,787 123,196 6,421,739 3,501,119 6,421,739 3,501,119 3,501,119 5,688,265 - (3,596,123) 2,918,996 1,600,315 1,624 (191,338) 6,421,739 3,501,119

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2008 $ NOTE 12 – TRADE AND OTHER PAYABLES CURRENT Unsecured liabilities: Trade payables Other creditors and accruals $1,661 (2012: $Nil) is owed to Norman Waterhouse Lawyers for legal services. Mr G English was a partner of Norman Waterhouse Lawyers until 1 July 2013. NOTE 13 – SHORT-TERM PROVISIONS CURRENT Employee entitlements Provision for remuneration bonus NON-CURRENT Employee entitlements During the year a remuneration bonus provision of $104,850 (2012: $76,500) has been provided for in accordance with employment agreements. The bonus remains payable at the discretion of the board. NOTE 14 - ISSUED CAPITAL 82,362,763 (2012: 82,362,763) fully paid ordinary shares a) Ordinary Shares At 1 July 2011 Shares issued during the year Total shares issued at 30 June 2012 Shares issued during the year Total shares issued at 30 June 2013		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $ 205,859 197,233 99,078 142,358 304,937 359,591 55,279 29,737 104,850 76,500 160,129 106,237 29,134 22,225 $ $ $ $ $ 15,456,408 15,528,408 Number Number Number 64,428,477 17,934,286 82,362,763 - 82,362,763

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2008 $ NOTE 14 - ISSUED CAPITALcontinued b) Issued Capital At 1 July 2011 Shares issued Total shares issued at 30 June 2012 Cost of shares issued from prior period Total shares issued at 30 June 2013 Ordinary shares participate in dividends and the proceeds on winding of the parent entity in proportion to the number of shares held. At shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands. c) Options on issue Details of the share options outstanding as at the end of the year are set out below: Grant date Expiry date Exercise price $ 3 September 2009 Unlisted employee options 31 Dec 2012 0.20 3 December 2010 Unlisted employee options 30 Nov 2013 0.20 30 October 2012 Unlisted consultant options 1 April 2014 0.40 21 December 2012 Unlisted consultant options 1 April 2014 0.40 2 January 2013 Unlisted employee options 2 January 2015 0.28		Consolidated Group Parent Entity 2013 2010 2009 2008 $ $ $ $
		10,699,698 - 4,838,710 - 15,528,408 - (72,000) - - - 15,456,408 - 2013 2012 Number Number - 1,000,000 5,000,000 5,000,000 1,500,000 - 1,500,000 - 75,000 - 8,075,000 6,000,000

d) Capital management

Management controls the capital of the Group in order to maintain a good debt equity ratio, provide the shareholders with adequate returns and ensure that the Group can fund its operations and continue as a going concern.

The Group’s debt and capital includes ordinary share capital and financial liabilities, supported by financial assets. There are no externally imposed capital requirements.

Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of debt levels, distributions to shareholders and share issues.

There have been no changes in the strategy adopted by management to control the capital of the Group since the prior year. The strategy is to ensure that the Group’s gearing ratio remains minimal. At 30 June 2013 the Company had debt of $Nil (2012: Nil).

NOTE 15 - RESERVES

Share option reserve

The share option reserve records items recognised as an expense on valuation of employee share options.

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NOTE 16 – TENEMENTS The Company’s interest in tenements are as follows: All tenements are within South Australia Project Tenement Commodity Worlds End EL 4230 Base Metals Carappee Hill EL 4862 Graphite North Burra EL 4266 Base Metals North Cowell EL 4277 Base Metals Australia Plains EL 4482 Base Metals Wildhorse Plain EL 4694* Graphite Napoleans Hat EL 4668 Gold Mt Shannon EL 4673 Graphite Eudunda EL 4840 Industrial Minerals Cleve West EL 4893 Graphite Ediacara EL 4869 Barite Ediacara PELA 567 Coal to Liquid Wichelina EL 4729 Magnesite Termination Hill EL 4567 Magnesite Spring Creek EL4249 Baae Metals Robertstown ELA 109/2013 Base Metals Mt Messenger ELA 304/2012 Base Metals Carrying value of exploration costs		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $
		Carrying value Carrying value $ $ 436,958 261,635 1,081,022 1,012,368 477,573 390,518 315,707 129,306 57,921 49,910 3,567,536 1,386,980 51,871 18,531 15,233 1,532 4,648 2,700 52,260 1,987 19,863 8,913 3,634 3,634 57,945 14,827 271,989 218,278 6,332 - 675 - 572 - 6,421,739 3,501,119 -

All tenements are owned 100% other than those marked * which are joint ventures to earn 100% of any minerals excluding Uranium.

NOTE 17 - CAPITAL AND OTHER

EXPENDITURE COMMITMENTS

Capital commitments relating to tenements

The Consolidated Group is required to meet minimum expenditure requirements of various Australian Government bodies. These obligations are subject to re-negotiation, may be farmed out or may be relinquished and have not been provided for in the financial statements.

Exploration expenditure commitments

loration expenditure commitments - due within one year - due over 5 years	755,259 781,732 - 300,000 - 755,259 1,081,732 - -

Operating Lease commitments

Commitments for minimum lease payments in relation to non-cancellable operating leases not provided for in the financial statements.

Lease expenditure commitments - due within one year - due within 1-5 years - due over 5 years	4,888 - - - - - 4,888 -

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NOTE 17 - CAPITAL AND OTHER EXPENDITURE COMMITMENTScontinued Employment and consultant commitments Commitments for the payment of salaries and other remuneration pursuant to an employment contracts not provided for in the financial statements Expenditure commitments - due within one year - due within 1-5 years - due within 6-10 years Details relating to the employment contracts are set out in the Remuneration Report. Property commitments - due within one year - due within 1-5 years - due within 6-10 years		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $
		96,164 557,490 - 96,164 - - - - 96,164 653,654 390,000 - - - - - - - 390,000 -

NOTE 18 - OPERATING SEGMENTS

Segment Information

Identification of reportable segments

The Group has identified its operating segments based on the internal reports that are reviewed and used by the board of directors (chief operating decision makers) in assessing performance and determining the allocation of rescources.

The Group is managed primarily on the basis of commodities and exploration licence cost centres as each cost centre has different cash requirements. Operating segments are therefore determined on the same basis.

Reportable segments disclosed are based on aggregating operating segments where the segments are considered to have similar economic characteristics and are also similar with respect to the following:

Leigh Creek magnesite project
Graphite and manganese projects
Other exploration areas in South Australia

Types of products and services by segment

Revenue

The Group has no revenue from mining at this time.

Accounting policies adopted

Unless stated otherwise, all amounts reported to the Board of Directors as the chief decision maker with respect to

operating segments are determined in accordance with accounting policies that are consistent to those adopted in the annual financial statements of the Group.

Inter-segment transactions

An internally determined transfer price is set for all inter-entity management fees. This price is based on cost plus an overhead factor. No other administration costs are charged to the two identified segments. All such transactions are eliminated on consolidation of the Groups financial statements.

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NOTE 18 - OPERATING SEGMENTS continued

Segment Assets

Where an asset is used across multiple segments, the asset is allocated to the segment that receives the majority of economic value from the asset. In the majority of instance, segment assets are clearly identifiable on the basis of the nature and physical location.

Unless indicated otherwise in the segment assets note, investments in financial assets and deferred tax have not been allocated to operating segments.

Segment liabilities

Liabilities are allocated to segments where there is direct nexus between the incurrence of the liability and the operations of the segment. Borrowings and liabilities are generally considered to relate to the Group as a whole and are not allocated. Segment liabilities include trade and other payables and certain direct borrowings.

Unallocated items

The following items of revenue, expense, assets and liabilities are not allocated to operating segments as they are not considered part of the core operations of any segment. Borrowings and liabilities are generally considered to relate to the Group as a whole and are not allocated. Segment liabilities include trade and other payables and certain direct borrowings:

interest received;
net gains on disposal of assets;
impairment of assets, other than exploration, and other non-recurring item of revenue or expense;

Segment Performance Segment results before income tax Reconciliation of segment results to Group net loss before tax Unallocated income and expenses Interest and other income Depreciation Corporate overheads Prof t/(Loss) before tax Segment assets as at 30 June 2013 Segment asset increase for the year - exploration expenditure capitalised - expensed during the year Total corporate and unallocated assets Total Group assets Segment liabilities at 30 June 2013 Total corporate and unallocated liabilities Total Group Liabilities	Exploration
	Leigh Creek Graphite / Magnesite Manganese Other	Total
	30-Jun 30-Jun 30-Jun 30-Jun 30-Jun 30-Jun 2013 2012 2013 2012 2013 2012 $ $ $ $ $ $ - - - - 1,624 4,212,539	30-Jun 30-Jun 2013 2012 $ $ 1,624 4,212,539
	- - - - 1,624 4,212,539	1,624 4,212,539
	329,934 233,105 6,405,682 2,376,546 923,929 891,468 96,829 109,544 4,029,136 1,757,813 32,641 272,541 - - - - 1,624 (191,338) 18,150 1,253 175,233 209,452 8,425 4,501	546,583 161,044 (14,926) (17,479) (1,215,456) (1,010,452)
		(682,175) 3,345,652
		7,659,545 3,501,119 8,774,335 13,195,281
		16,433,880 16,696,400
		201,808 215,206 292,392 252,847
		494,200 468,053

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NOTE 19 - CASH FLOW INFORMATION a) Reconciliation of cash flows from operations with Profit/(Loss) from ordinary activities after income tax Profit/(Loss) from ordinary activities after income tax Depreciation (net of capatialised depreciation) Share option expense Gain on sale of assets (Recovery)/Write down of assets Tax expenses on capital raising costs Changes in assets and liabilities; - (Increase)/Decrease in trade and other receivables - Increase/(Decrease) in trade and other payables - Increase in provisions Net cash provided by operating activities		Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $
		(359,581) 3,387,278 6,627 17,479 70,914 42,725 - (4,403,827) (1,624) 191,338 - 71,183 16,626 (65,335) (48,442) 52,448 60,800 15,047 (254,680) (691,664)

b) Non Cash Financing and Investing Activities

There were no non cash financing and investing activities in 2013 or 2012.

c) Business Combinations

There were no non cash business combinations in 2013 or 2012.

NOTE 20 - SHARE BASED PAYMENTS

The company established the Archer Exploration Limited Employee Share Option Plan in order to reward employees for services rendered. All employees are entitled to participate in the plan if in the employment of the consolidated Group. Employees are entitled to acquire vested ordinary shares at an agreed price. When issued, the shares carry full dividend and voting rights.

During the year 3,075,000 (2012: Nil) share options were issued.

All options granted to are over ordinary shares in Archer Exploration Limited, which confer a right of one ordinary share.

Outstanding at the beginning of the year Granted Forfeited Exercised Expired Outstanding at year-end Unexercisable at year-end		Consolidated Group 2013 2012 Number of Weighted Number of Weighted Options Average Options Average Exercise Exercise Price $ Price $ 6,000,000 0.20 6,520,000 0.194 3,075,000 - - - - - - - - - (220,000) - (1,000,000) 0.20 (300,000) 0.187 8,075,000 0.275 6,000,000 0.20 1,050,000 0.35 2000,000 0.20

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NOTE 20 - SHARE BASED PAYMENTS continued

The options outstanding at 30 June 2013 had a weighted average exercise price of $0.275 and a weighted average remaining contractual life of 0.53 years.

The fair value of options issued during 2013 as remuneration, were calculated by using a Black-Scholes option pricing model applying the following inputs:

Weighted average exercise price Weighted average life of the option da Underlying share price Expected share price volatility Risk free interest rate	2013 2012	2013 2012
	Employee $ 0.28 ys 730 $ 0.19 % 74 % 2.65	Consultant Advisors Employee 0.40 0.40 - 520 467 - 0.19 0.19 - 97 85 - 2.72 2.65 -

Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is indicative of future tender, which may not eventuate.

The life of the options is based on the historical exercise patterns, which may not eventuate in the future.

Included under employee benefits expense in the Statement of Comprehensive Income is $21,414 (2011: $42,725), which relates in full, to equity settled share-based payment transactions.

NOTE 21 - EVENTS AFTER THE BALANCE SHEET DATE

On 1[st] July 2013 the Company entered into a legally binding Heads of Agreement to acquire land at the Campoona Graphite project. A deposit has been paid the balance of the acquisition price will be paid in two instalments as contract conditions are completed. Other than as disclosed, there have been no material events after balance date.

NOTE 22 - RELATED PARTY TRANSACTIONS

a) Subsidiaries

Interests in subsidiaries are disclosed in Note 9.

b) Key Management Personnel

Disclosures relating to Key Management personnel are set out in Note 4.

c) Other translations with related parties

Norman Waterhouse Lawyers were paid a total of $23,325 (2012: $13,242) for legal services.

Mr Greg English was a partner of Norman Waterhouse Lawyers until 1 July 2013.

NOTE 23 - FINANCIAL INSTRUMENTS

a) Financial Risk Management Policies

The Group’s financial instruments consist mainly of deposits with banks, short-term investments, accounts receivable and payables.

i) Treasury Risk Management

The Board meets on a regular basis to analyse financial risk exposure and to evaluate treasury management strategies in the context of the most recent economic conditions and forecasts.

The Board’s overall risk management strategy seeks to assist the consolidated Group in meeting its financial targets, whilst minimising potential adverse effects on financial performance.

ii) Financial Risk Exposure and Management

The main risk the Group is exposed to through its financial instruments is interest rate risk.

Interest Rate Risk

Interest rate risk is managed with a mixture of fixed and floating rate cash deposits. At 30 June 2013

approximately 96% of Group deposits are fixed. It is the policy of the Group to keep between 90% and 100% of surplus cash in high yielding deposits.

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NOTE 23 - FINANCIAL INSTRUMENTS continued

Weighted Average Effective Interest Rate 2013 2012 % % Financial Assets Cash at bank 0.30% 0.30% Deposits 5.00% 5.49% Receivables - - Total Financial Assets Financial liabilities Payables - - Financial liabilities - - Total Financial Liabilities Total Net Financial Assets/ (Liabilities)	Weighted Average Effective Interest Rate 2013 2012 % %	Effective Interest Rate Non Interest Bearing Total 2013 2012 2013 2012 2013 2012 $ $ $ $ $ $
		18,260 24,417 - - 18,260 24,417 8,537,389 12,728,479 - - 8,537,389 12,728,479 - - 90,705 319,189 90,705 319,189 8,555,649 12,752,896 90,705 319,189 8,646,354 13,072,085 - - (304,937) (339,591) (304,937) (339,591) - - - - - - - - (304,937) (339,591) (304,937) (339,591) 8,555,649 12,752,896 214,232) (20,402) 8,341,417 12,732,494

b) Sensitivity Analysis

Interest Rate and Price Risk

The Group has performed a sensitivity analysis relating to its exposure to interest rate risk at balance date. This sensitivity analysis demonstrates the effect on the current year results and equity which could result from a change in these risks.

Interest Rate Sensitivity Analysis

At 30 June 2013, the effect on loss and equity as a result of changes in the interest rate, with all other variables remaining constant would be as follows:

Change in loss - Increase in interest rates by 2% - Decrease in interest rates by 2% Change in equity - Increase in interest rates by 2% - Decrease in interest rates by 2%	Consolidated Group Parent Entity 2013 2012 2009 2008 $ $ $ $
	109,000 36,000 (109,000) (36,000) 109,000 36,000 (109,000) (36,000)

c) Net Fair Value of Financial Assets and Liabilities

The net fair value of cash and cash equivalent and non interest bearing monetary financial assets and financial liabilities of the consolidated entity approximate their carrying value.

The net fair value of other monetary financial assets and financial liabilities is based on discounting future cash flows by the current interest rates for assets and liabilities with similar risk profiles. The balances are not materially different from those disclosed in the Statement of Financial Position of the consolidated entity.

d) Credit Risk

The maximum exposure to credit risk, excluding the value of ant collateral or other security, at balance date to recognised financial assets, is the carrying amount, net of any provisions for doubtful debts of those assets, as disclosed in the Statement of Financial Position and notes to the financial statements.

The consolidated entity does not have any material credit risk exposure to any single debtor or group of debtors under financial instruments entered into by the consolidated entity.

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	Parent Entity	Parent Entity	Parent Entity
	2013	2012	2009	2008
	$	$	$	$
NOTE 24 - ARCHER EXPLORATION LIMITED
PARENT COMPANY INFORMATION
Parent Entity
Assets
Current Assets	7,526,217	10,280,659
Non-current assets
- Loans to subsidiaries	1,719,918	-
- Investments in subsidiaries	26,623	26,623
Other non-current assets	127,980	123,196
Total assets	9,400,738	10,430,478
Liabilities
Current Liabilities	233,220	232,808
Loans from subsidiaries	-	691,746
Non current Liabilities	21,167	16,188
Total Liabilities	254,387	940,742
Equity
Issued Capital	15,456,406	15,528,406
Reserves	381,701	238,787
Retained Earnings	(6,691,756)	(6,277,457)
Total Equity	9,146,351	9,489,736
Financial Performance
Loss for the year	(414,299)	(3,254,340)
Other comprehensive income	-	-
Total comprehensive income	(414,299)	(3,254,340)
Guarantees in relation to relation to the debts
of subsidiaries
Archer Exploration Limited has not entered into a deed
of cross guarantee with its wholly-owned subsidiaries
Pirie Resources Pty Ltd, Archer Pastoral Company Pty
Ltd, Leigh Creek Magnesite Pty Ltd, Archer Energy &
Resources Pty Ltd and SA Exploration Pty Ltd.
Contingent Liabilities & Commitments
Lease expenditure commitments	4,888	-
Employment and consultant commitments	96,164	653,654
Contractual Commitments
There are no contractual capital commitments for the
acquisition of property, plant or equipment

Directors’ Declaration

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The Directors of the Company declare that:

1 the Financial Statements and Notes as set out on pages 64 to 90 are in accordance with the Corporations Act 2001 and:
a) comply with Australian Accounting Standards and International Financial Reporting Standards as
- disclosed in Note 1; and
b) give a true and fair view of the fi nancial position as at 30 June 2013 and of the performance for the
- year ended on that date of the Company and Consolidated Group;
2
a) the fi nancial records of the Company for the year ended have been properly maintained in accordance with section 286 of the Corporations Act 2001;
b) the fi nancial statements and notes for the fi nancial year comply with the Accounting Standards; and
c) the fi nancial statements and notes give a true and fair view;
3 in the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors.

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Greg English Chairman

Adelaide

Dated this 10[th] September 2013

Independent Audit Report

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Level 1, 67 Greenhill Rd Wayville SA 5034 GPO Box 1270 Adelaide SA 5001 T 61 8 8372 6666 F 61 8 8372 6677 E [email protected] W www.grantthornton.com.au

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ARCHER EXPLORATION LIMITED REPORT ON THE FINANCIAL REPORT

We have audited the accompanying financial report of Archer Exploration Limited (the “Company”), which comprises the consolidated statement of financial position as at 30 June 2013, the consolidated statement of profit or loss statement and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information and the directors’ declaration of the consolidated entity comprising the Company and the entities it controlled at the year’s end or from time to time during the financial year.

Directors’ responsibility for the financial report

The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 The Directors’ responsibility also includes such internal control as the Directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. The Directors also state, in the notes to the financial report, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, the financial statements comply with International Financial Reporting Standards.

Auditor’s responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require us to comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

Grant Thornton Audit Pty Ltd ACN 130 913 594

a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

Independent Audit Report

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An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.

Auditor’s opinion

In our opinion:

a the financial report of Archer Exploration Limited is in accordance with the Corporations Act 2001, including:
i giving a true and fair view of the consolidated entity’s financial position as at 30 June 2013 and of its performance for the year ended on that date; and
ii complying with Australian Accounting Standards and the Corporations Regulations 2001; and
b the financial report also complies with International Financial Reporting Standards as disclosed in the notes to the financial statements.

Report on the remuneration report

We have audited the remuneration report included the directors report for the year ended 30 June 2013. The Directors of the Company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.

9 3

Independent Audit Report

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Auditor’s opinion on the remuneration report

In our opinion, the remuneration report of Archer Exploration Limited for the year ended 30 June 2013, complies with section 300A of the Corporations Act 2001.

GRANT THORNTON AUDIT PTY LTD Chartered Accountants

S J Gray Director – Audit & Assurance Adelaide, 10 September 2013

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Additional Information

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Compiled as at 6 September 2013

Additional information required by the ASX Listing Rules and not disclosed elsewhere in this report is set out below.

Audit Committee

Details of the Company’s Audit and Risk Committee are contained within the Director’s Report.

Corporate Governance Practices

A statement disclosing the extent to which the Company has followed the best practice recommendations set by the Australian Securities Exchange Corporate Governance Council during the reporting period immediately follows the Director’s Report.

Substantial Shareholders

The names of the substantial shareholders in the Company, the number of equity securities to which each substantial shareholder and substantial holder’s associates have a relevant interest, as disclosed in substantial holding notices given to the Company:

Name	No. of Ordinary Share	%
GDE Exploration (SA) Pty Ltd (Dragon Mining Investments A/C)	7,534,798	9.15

Distribution of equity by security holders

Ordinary Shares

Holdings	Shares	Options
1 – 1,000	51	-
1,001 - 5,000	226	-
5,001 – 10,000	280	-
10,001 – 100,000	809	1
100,001 and over	116	3
Total	1,482	4
Unmarketable Parcels		Minimum parcel size	Holders	Units
Minimum $500.00 parcel at $0.165 per unit		3,031	142	221,777

Voting Rights

At meeting of members or classes of members:

Ordinary shares

On a show of hands, every person present who is a member or proxy, attorney or representative of a member has one vote.

Options

No voting rights.

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Additional Information

Twenty largest holders of each class of quoted equity security

Ordinary Shares

Rank	Name	Units	% Issued capital
1	GDE Exploration (SA) Pty Ltd	7,534,798	9.15
2	JP Morgan Nominees Australia Limited	3,420,441	4.15
3	Mr Peter Irwin	2,200,000	2.67
4	Victor M Lewis	1,965,351	2.39
5	Ms Alice McCleary + Mr Brian John McCleary	1,928,264	2.34
6	Deborah Annette Rossiter	1,883,679	2.29
7	Mr Heung Ming Lam	1,557,775	1.89
8	EAP Nominees Pty Ltd	1,110,346	1.35
9	Mr Craig Gooden + Mrs Virginia Gooden	985,347	1.20
10	Dr Gregory Philip Corboy	942,582	1.14
11	Clockwell Pty Ltd	870,351	1.06
12	Mr Robert John Muffet	800,000	0.97
13	Navigator Australia Ltd	701,087	0.85
14	Mr David Duvdevani	641,834	0.78
15	Mrs Kristina Muffet	600,000	0.73
16	Mr Sheldon Finn + Mrs Rochelle Finn	556,451	0.68
17	Mr Harold Duerden + Mrs Natalina Duerden	553,693	0.67
18	Campbell Kitchener Hume & Associates Pty Ltd	535,351	0.65
19	GDE Exploration (SA) Pty Ltd	500,000	0.61
20	Mr Richard Lawrie Seifert	500,000	0.61
Total		29,787,350	36.18

Use of Cash

During the fi nancial year, the Company used the cash and assets in a form readily convertible to cash in a manner that was consistent with its business objectives.

Stock Exchange on which the Company’s Securities are quoted

The Company’s listed equity securities are quoted on the Australian Securities Exchange.

On Market Buy-back

There is currently no on-market buy-back.

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Corporate Directory

Archer Exploration Limited

ABN 64 123 993 233

Directors

Greg English Chairman

Gerard Anderson Managing Director

Tom Phillips AM Director (Non-Executive)

Alice McCleary Director (Non-Executive)

Company Secretary

Craig Gooden

Registered Offi ce

Level 1, 28 Greenhill Road Wayville SA 5034 Telephone +61 8 8272 3288 Facsimile +61 8 8272 3888 www.archerexploration.com.au

Share Registry

Computershare Investor Services Pty Ltd Level 5, 115 Grenfell Street Adelaide SA 5000 GPO Box 1903 Adelaide SA 5001 Investor Enquiries (within Australia): 1300 556 161 Facsimile +61 8 8236 2305

Auditors

Grant Thornton South Australian Partnership Level 1, 67 Greenhill Road Wayville SA 5034

Solicitors

Piper Alderman Level 16, 70 Franklin Street Adelaide SA 5000

Bankers

Bank of Queensland 151 Pirie Street Adelaide SA 5000

Australian Securities Exchange: ASX code : AXE

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AI assistant

ARCHER MATERIALS LIMITED — Annual Report 2013

64478_rns_2013-09-09_add22e45-8f3b-4657-b34a-9423aeadd9b4.pdf

Campoona: Maiden JORC Resource (2%TGC)

Campoona: Maiden JORC Resource (5%TGC)

Dear Shareholder,

Archer’s tenements

Archer’s Graphite Projects

The Campoona Region

Campoona

Campoona Shaft - 2013 Drilling

Central Campoona - 2013 Drilling

Campoona Geology

~~Campoona Shaft Schematic Long Section~~

Campoona JORC Resource

Campoona Metallurgy

Campoona Graphite Marketing

Land Acquistion

Mining Lease Proposal and PEPR

Campoona Regional 2103 Exploration

Sugarloaf Deposit

Geology and exploration Summary

Sugarloaf Metallurgical Diamond Drilling

Magnesite

Introduction

Tenements

History

Geology, Mineralogy and Trace Element Chemistry

Mineral resources

Beneficiation

Logistics

Conclusion

Wildhorse Plain

Watervale and Wonna Gold (El 4230 / EL 4668)

Copper

Worlds End (EL 4230)

Robertstown

Mimic

North Cowell (EL 4277)

Emu Plain

Spring Creek

Spring Creek

Manganese

Archer’s Advanced Manganese Projects

Ketchowla Manganese Projects

Ketchowla Manganese Prospects

Ketchowla Geophysical Surveys

Salt Creek Manganese Project

Background

Phosphate

Worlds End (EL 4230)

Phosphate and Barite

Australia Plains (EL 4482)

Barite

Coal ± Gasifi cation

Directors’ ReportDirectors’ Report

Signifi cant Changes in State of Affairs

Directors

Directors

Principal Activities

Operating Results

Dividends

Operating and Financial Review

Signifi cant Changes in State of Affairs

Matters Subsequent to the End of the Financial Year

Future Developments, Prospects and Business Strategies

Directors’ Report

Environmental Issues

Remuneration Report (Audited)

Remuneration Policy

Voting and comments made at the Company’s 2012 Annual General Meeting

Directors’ Report Information on Directors’ and Management

Directors’ Report

Service Agreements

Gerard Anderson, Managing Director/CEO,

Archer Exploration Limited

Greg English, Chairman, Non-Executive DIrector

Archer Exploration Limited

Tom Phillips AM, Non-Executive Director, Archer Exploration Limited

Alice McCleary, Non-Executive Director, Archer Exploration Limited Base remuneration.

ARCHER MATERIALS LIMITED Annual Report 2013

Campoona Shaft Schematic Long Section