COKAL LIMITED - Capital/Financing Update 2007

ALTERA CAPITAL LIMITED ABN 55 082 541 437

PROPOSED TO BE RENAMED ALTERA RESOURCES LIMITED

PROSPECTUS

For an offer of 12,500,000 Shares at 20 cents each to raise $2,500,000

LEAD MANAGER Patersons Securities Limited ABN 69 008 896 311

The securities being offered by this Prospectus should be considered speculative. This document is important and should be read in its entirety. You may wish to consult your stockbroker, solicitor, accountant or other financial adviser about its contents.

Corporate Directory

DIRECTORS

Godfrey Rule Chairman & Executive Director

Harjinder Kehal Executive Director

SHARE REGISTRY

Advanced Share Registry Services 110 Stirling Highway NEDLANDS WA 6009 Telephone: (+618) 9389 8033

AUDITORS

Bradley G.J Abbott Non Executive Director

Jeremy Shervington Non Executive Director

COMPANY SECRETARY

Bradley Abbott

REGISTERED OFFICE

813 Wellington Street WEST PERTH WA 6000 Telephone: (+618) 9225 5750

Email: [email protected]

LEAD MANAGER

Patersons Securities Limited Level 23 Exchange Plaza 2 The Esplanade PERTH WA 6000 Telephone: (+618) 9263 1111

HOME EXCHANGE

Stantons International Level 1, 1 Havelock street West Perth 94813188

SOLICITOR TO THE ISSUE

Jeremy Shervington 52 Ord Street WEST PERTH WA 6005 Telephone: (+618) 9481 8760

INDEPENDENT GEOLOGIST

Agricola Mining Consultants Pty Ltd PO Box 473 SOUTH PERTH WA 6951 Telephone: (+618) 9368 4923

SOLICITOR REPORTING ON MINING INTERESTS

Jeremy Shervington 52 Ord Street WEST PERTH WA 6005 Telephone: (+618) 9481 8760

Australian Securities Exchange Perth Western Australia

ASX CODE

AEA

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Investment Highlights

Advanced base metals exploration project

Broken Hill SEDEX type sulphide mineralisation.
Previous exploration has confirmed and outlined coincident geochemical/thumbprint magnetic targets.
The Company has entered into the Farmin Agreement under which it has the right to earn a 65% interest in the Gascoyne Base Metals Project, 250 km east of Carnarvon in Western Australia.

Other opportunities

The Company will also seek to pursue complementary opportunities with the potential to add value.

Experienced board and management

Experienced board with appropriate mix of skills.
Management has strong expertise in the resources industry.

Key Investment Risks

The Company is an exploration stage single project company.
No resources have yet been established.
The Company’s ability to develop the Project and pursue complementary opportunities will be dependent on the Company’s ability to obtain further funding.
The commencement of any development on the Project will be subject to obtaining the grant of various approvals and permits, and the Company’s operations will be adversely affected in the event there are delays in obtaining such approvals and permits, or if such approvals and permits cannot be obtained.

Refer to Section 7 for a description of the risk factors that could affect the Company. Prospective applicants should read the entire Prospectus before applying for Shares.

Key Offer Statistics

Offer price per Share

20 cents

• Shares to be offered under this Prospectus¹ 12.5 million • Amount to be raised under the Offer¹ $2.5 million • Existing Shares¹ 7,703,348

• Earn In Shares 250,000

Shares on issue following the Offer¹ 20,453,348

• Options on issue following the Offer¹ ² 6,100,000

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Market capitalisation at the Offer price
$4,090,670
(1) Subject to the passing of the Resolutions at the General Meeting, the Company’s Shares will be reduced from 142,018,213 Shares to 7,703,348 Shares.
(2) Includes 2,100,000 Existing Options (subject to the passing of the Resolutions at the General Meeting, the Existing Options will be reduced from 52,500,000 Options to 2,100,000 Options) and there will be 4,000,000 Director Options. The terms and conditions of the Existing Options are described in Section 8.6 and the terms and conditions of the Director Options are described in Section 8.7.

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Section 1 OVERVIEW OF THE COMPANY Section 2 DETAILS OF THE OFFER Section 3 DIRECTORS AND MANAGEMENT Section 4 INDEPENDENT GEOLOGIST’S REPORT Section 5 INVESTIGATING ACCOUNTANT’S REPORT Section 6 SOLICITOR’S REPORT ON MINING INTERESTS Section 7 RISK FACTORS Section 8 ADDITIONAL INFORMATION Section 9 DIRECTOR’S RESPONSIBILITY STATEMENT AND CONSENT Section 10 GLOSSARY OF TERMS APPLICATION FORMS

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Letter from the Chairman

30 October 2007

Dear Investor,

The Board of Altera Capital Limited (proposed to renamed as Altera Resources Limited) is pleased to offer you this opportunity to become a shareholder in the Company.

In June 2003 the Company was suspended from trading on the ASX. The current Board were appointed in August 2006 and since that time they have reviewed a number of commercial opportunities with a view to enhancing shareholder value, raising additional capital and to seek reinstatement of its shares on the ASX.

The Board has now identified an opportunity for the Company to earn an interest in a base metals exploration project in the Gascoyne region of Western Australia. The terms under which the Company can farm in to this Project are set out in this Prospectus and will be subject to the approval of shareholders for the issue of 0.25 million shares to the registered owners of the Project at a general meeting to be held on the 26[th] of November 2007.

At that meeting shareholders will also be asked to approve a capital reconstruction of the Company’s issued capital and to approve the issue of 12.5 million shares at $0.20 each, the subject of this Prospectus, to raise $2.5 million to enable its shares to be reinstated on the ASX. Shareholders will also be asked to approve the change the name of the Company to Altera Resources Limited.

The Board believes the Project is located in a very prospective area for the discovery of base metal deposits. The Project is discussed in more detail in Section 1.3 of this Prospectus.

The Company’s strategy will be to enhance shareholder value by the discovery and development of base metal deposits within the Project as rapidly as possible using the exploration program outlined in this Prospectus. The Board will also consider other opportunities in the resources sector as and when they arise.

The information set out in this Prospectus is important and we recommend you study this document with care. An investment in the Company is considered to be speculative and if necessary you should seek independent professional advice.

The Board of the Company looks forward to your investment pursuant to this offer and to welcome you as a shareholder of the Company.

On behalf of the Board A G Rule

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Capital Structure

After completion of the Offer made pursuant to this Prospectus, the capital structure of the Company will be as follows:

Shares
Existing Shares¹	7,703,348
Earn In Shares	250,000
Shares to be offered pursuant to the Prospectus	12,500,000
Maximum Total Shares on issue	20,453,348
Options²
Existing Options¹	2,100,000
Director Options	4,000,000
Maximum Total Options on issue	6,100,000
New funds raised by the Offer	$2,500,000
Estimated costs of the Offer	$239,910

Note 1: Subject to the passing of the Resolutions at the General Meeting, the Company’s Shares will be reduced from 142,018,213 Shares to 7,703,348 Shares, and the Company’s Existing Options will be reduced from 52,500,000 Options to 2,100,000 Options .
Note 2: The rights attaching to the Shares offered pursuant of this Prospectus are described in Section 8.5. The rights attaching to the Existing Options are described in Section 8.6 and the rights attaching to the Director Options are described in Section 8.7.

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Important Notice

This Prospectus is dated 30 October 2007 and a copy of this Prospectus was lodged with the ASIC on that date. ASIC takes no responsibility for the contents of this Prospectus. No Shares will be allotted or issued on the basis of this Prospectus later than the expiry date of this Prospectus being the date which is 13 months after the date of this Prospectus. Shares allotted or issued pursuant to this Prospectus will be allotted or issued on the terms and conditions set out in this Prospectus.

Before deciding to invest in the Company, potential investors should read the entire Prospectus and, in particular, in considering the prospects for the Company, investors should consider the risk factors that could affect the financial performance of the Company. Investors should carefully consider these factors in light of personal circumstances (including financial and taxation issues). The Company is undertaking exploration and mining development and the risks are therefore significant. The securities offered by this Prospectus should be considered speculative. Refer to Section 7 for details relating to risk factors. Investors should seek professional advice from an accountant, stockbroker, lawyer or other professional adviser before deciding whether to invest.

No person is authorised to give any information or to make any representation in connection with the Offer described in this Prospectus which is not contained in this Prospectus. Any information or representation not so contained may not be relied upon as having been authorised by the Company in connection with the Offer.

This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.

No action has been taken to register or qualify the Shares or the Offer, or otherwise to permit a public offering of the Shares, in any jurisdiction outside Australia.

In accordance with Chapter 6D of the Corporations Act this Prospectus is subject to an Exposure Period of seven days from the date of lodgement with the ASIC. This period may be extended by the ASIC for a further period of up to seven days. The purpose of the Exposure Period is to enable this Prospectus to be examined by market participants prior to the raising of funds. If this Prospectus is found to be deficient, Applications received during the Exposure Period will be dealt with in accordance with section 724 of the Corporations Act. Applications received prior to the expiration of the Exposure Period will not be processed until after the expiry of the Exposure Period. No preference will be conferred on Applications received during the Exposure Period and all Applications received during the Exposure Period will be treated as if they were simultaneously received on the Opening Date.

This Prospectus will be issued in paper form and as an Electronic Prospectus, which may be viewed online at www.alteracapital.com.au or at www.psl.com.au . The Offer is available to persons receiving an electronic version of this Prospectus in Australia. The Corporations Act prohibits any person from passing onto another person the Application Form unless it is attached to or accompanied by a complete and unaltered version of this Prospectus. During the Offer Period, any person may obtain a hard copy of this Prospectus by contacting the Company directly by telephone on 08 9321 2642 or by email at [email protected] or the Lead Manager on 08 9263 1111 or by email at [email protected].

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Short Form Prospectus

This Prospectus is a short form prospectus issued in accordance with section 712 of the Corporations Act. This means this Prospectus alone does not contain all information that is generally required to satisfy the disclosure requirements of the Corporations Act. Rather, it incorporates all other necessary information by reference to the Corporate Governance Statement by the Company contained in the Company’s Annual Report 2007 (“Corporate Governance Statement”) lodged with ASIC on 28 September 2007.

In referring to the Corporate Governance Statement, the Company:

(a) identifies the Corporate Governance Statement as being relevant to the Offer of a Share under this Prospectus and containing information that will provide investors and their professional advisers with information to assist them in making an informed assessment of:
(i) the rights and liabilities attaching to the Shares;
(ii) the capacity of the Company to issue the Shares; and
(iii) the assets and liabilities, financial position and performance, profits and losses and prospects of the Company;
(b) refers investors and their professional advisers to Section 3.2 of this Prospectus which summarises the information in the Corporate Governance Statement deemed to be incorporated in this Prospectus;
(c) informs investors and their professional advisers that they are able to obtain, free of charge, a copy of the Corporate Governance Statement by contacting the Company directly by telephone on 08 9321 2642 or by email at [email protected]; and
(d) advises that the information in the Corporate Governance Statement will be primarily of interest to investors and their professional advisers or analysts.

Privacy Disclosure

The Company collects information about each Applicant provided on the Application Form for the purposes of processing the Application, and, if the Applicant is successful, to administer the Applicant’s security holding in the Company.

By submitting an Application Form, each Applicant agrees that the Company may use the information provided on the Application Form for the purposes set out in this privacy disclosure statement and may disclose it for those purposes to the Company's share registry, the Company’s related bodies corporate, agents, contractors and third party service providers, including mailing houses and professional advisers, and to ASX and regulatory authorities.

The Corporations Act requires the Company to include information about security holders (including name, address and details of the securities held) in its Register. The information contained in the Company’s public register must remain there even if that person ceases to be a security holder of the Company. Information contained in the Company’s register is also used to facilitate distribution payments and corporate communications (including the Company’s financial results, annual reports and other information that the Company may wish to communicate to its security holders) and compliance by the Company with legal and regulatory requirements.

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If you do not provide the information required on the Application Form, the Company may not be able to accept or process your Application.

An Applicant has a right to gain access to the information that the Company holds about that person subject to certain exemptions under law. A fee may be charged for access. Access requests must be made in writing to the Company’s registered office.

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Section 1 Overview of the Company

1.1 Company History

The Company is presently listed on ASX but it’s Shares have been suspended from quotation since 13 June 2003.

The current Board was appointed on 8 August 2006 in conjunction with a capital raising of $240,000 by the Company to provide it with working capital to fund the search for suitable projects to achieve reinstatement of the Company’s Shares to quotation on ASX.

1.2 Company Overview and Objectives

The Company has entered into the Farmin Agreement under which it has the right to acquire a 65% interest in the Gascoyne Base Metals Project from ABM Resources NL and Rare Resources NL by issuing ABM Resources the Earn in Shares (comprising 250,000 Shares) and sole funding exploration on the tenements that comprise the Project to a total of $1 million by 14 September 2010. Completion under the Farmin Agreement is conditional on the Company completing the Capital Raising and its Shares being released from suspension from trading on the Official List.

The purpose of the Capital Raising is to raise the funds necessary to carry out the exploration and drilling at the Gascoyne Base Metals Project. Further information in relation to the Gascoyne Base Metals Project and the Company’s objectives is set out in Section 1.3 and in the Independent Geologist’s Report which is included in Section 4 of this Prospectus.

1.3 Gascoyne Base Metals Project

The Directors believe the Gascoyne Base Metals Project to be prospective for the discovery of new base metal deposits in the Gascoyne Province based on the delineation of coincident geochemical/thumbprint magnetic targets by exploration completed to date. The Project is located approximately 250 km to the east of Carnarvon in the Gascoyne region and comprises of three tenements, covering an area of approximately 370 km[2] .

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Figure 1: Location of Gascoyne Base Metals Project tenements

The Directors and their technical team have a track record of successful discoveries in the exploration industry and will focus on maximising value for the exploration drilling dollars. The Company has the ability to engage both reverse circulation and diamond drill rigs for early drill testing of the targets outlined within the Project area.

Project Overview

Target is Broken Hill SEDEX sulphide deposit

According to data provided by ABM Resources, previous exploration work during 2003-2004 in the central part of the Project, identified and recovered numerous gahnite grains in the heavy mineral fraction from stream and colluvial/alluvial sampling programs.

Gahnite is a zinc-aluminium oxide similar in form to magnetite, which is an iron spinel; it is resistant to weathering and hence is usually found in stream heavy mineral concentrates. It is notable that gahnite occurs in the mineralized horizon some significant distance from the sulphide body in SEDEX deposits such as at Broken Hill, Cannington and Mt Isa. Gahnite is also found in high grade metamorphics and previous exploration on the Project suggests such an environment exists within the Gascoyne Base Metals Project area.

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Fifteen rock chip samples taken from the Project were assayed for a suite of elements including Cu-Pb-Zn-Co-Ag-Au-Mn-Ni. Of these, two samples some 8km apart returned anomalous levels of Co-Cu-Zn; one sample, in the centre of the Project area had a concentration of 953ppm Pb.

Follow-up exploration has included the collection of 17 soil samples along station tracks in the vicinity of higher rock chip samples, which were again assayed for Cu-Pb-Zn-Co-Ag-Mn-Ni. Of the soil geochemical samples, three showed elevated Pb-Zn values of which one contained 408ppm Pb and 156ppm Zn.

A detailed airborne magnetic survey over the Project area was completed in 2007 by ABM Resources. A reinterpretation of the geology based on the aeromagnetic data has highlighted a west northwest striking (290 ° ) domal feature. The southern margin of the antiform has been transected by a west northwest striking shear, whilst the western part of the dome has undergone a later stage folding regime and the intrusion of a granitoid. The lithologies are probably silicieous, clastic sediments.

First-vertical derivative magnetic imagery shows the dome to be cut by several north-north east trending faults and mafic dykes whilst the north western area, (the region of possible intrusion and complex folding) is separated by northwest striking faults. On the northern flank of the dome, in the area of magnetic quiescence, subtle parallel (stratigraphic) linear anomalies have been outlined. Periodically, along some of these “strata” are weak but definite magnetic anomalies (“blobs”). A total of 8 magnetic anomalies have been outlined in the Project area. Interestingly, rock chip GG5312 returned values of 953ppm Pb, 487ppm Zn, 319ppm Cu and 394ppm Co and other anomalous samples, derive from one such stratum.

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Figure 2: Geological interpretation from aeromagnetic data

In summary, the important features of the Gascoyne Base Metals Project are:

A sequence of folded Proterozoic, silicieous, clastic sediments; probable late-stage granitoid intrusions.
A series of, apparent stratigraphic, magnetic anomalies.
Gahnite in heavy mineral concentrations from this region; source not determined.
Anomalous Pb-Zn-Cu values in rock chip and soil samples, some of which appear to be at the same stratigraphic level as the “thumbprint” magnetic anomalies.

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Competent Person’s Statement

Information in this section that relates to Exploration Results or Mineral Resources is based on information compiled by Mr Harjinder Kehal who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Kehal has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Kehal consents to the inclusion in this Prospectus of the statements based on his information in the form and context in which it appears.

1.4 The Offer

Pursuant to this Prospectus, the Company is making an Offer to public investors of 12,500,000 Shares at a price of 20 cents each to raise $2,500,000. All Shares offered under this Prospectus will rank equally with existing Shares.

The issue of Shares pursuant to this Prospectus and Completion under the Farmin Agreement are subject to and conditional upon Shareholders approving the Resolutions being put at a General Meeting of Shareholders to be held on the 26[th] November 2007.

Applications must be made on the Application Form enclosed with this Prospectus.

1.5 The Purpose of the Offer

The purpose of the Offer is to raise $2,500,000 to:

provide funding to commence exploration of the Gascoyne Base Metals Project and to complete related test work and studies, including, geological mapping, sampling and drilling;
provide funds for the administration of the Company; and
meet the expenses of the Offer of approximately $239,910 .

The issue of the Prospectus and the Capital Raising will also enable the Company to apply to ASX for the reinstatement to quotation of its Shares to the Official List.

Further details of the Offer are set out in Section 2.

1.6 Minimum Subscription and Oversubscriptions

The minimum subscription pursuant to this Prospectus is $2,500,000. No oversubscriptions will be accepted.

1.7 Expenditure Plans

The funds raised from the Offer will be broadly applied over the two years following listing as follows:

Use of Funds	$
Explorationbudget	1,300,000
Working capitalandAdministration	1,012,698

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Expenses ofthe Capital Raising	239,910

Made up of:
Existing cashassets	52,608
NewfundsfromCapital Raising	2,500,000

Further details of the activities on which the funds will be spent are set out above in Section 1.3.

The actual expenditures may vary from the above estimates and the Board reserves the right to appropriately vary the expenditure dependent on circumstances and other opportunities.

Please refer to the Independent Geologist’s Report in Section 4 of this Prospectus for a further breakdown of the proposed expenditure programme of the Company.

1.8 Working Capital

On completion of the Offer, the Directors believe that the Company will have sufficient working capital to carry out its stated objectives.

1.9 Investment Risks

Investors should be aware that there are risks associated with any investment in the stock market. In addition, there are a number of risk factors specific to investing in the Company, the resource, mining and exploration industry in which the Company operates and the general business environment.

Key risks associated with the Company’s business include that:

the Company is an explorations stage single project company;
no resources have yet been established;
the Company’s ability to develop the Project and pursue complementary opportunities will be dependent on the Company’s ability to obtain further funding; and
the commencement of any development on the Project will be subject to obtaining the grant of various approvals and permits, and the Company’s operations will be adversely affected in the event there are delays in obtaining such approvals and permits, or if such approvals and permits cannot be obtained.

Refer to Section 7 for a description of the risk factors that could affect the Company. Prospective applicants should read the entire Prospectus before applying for Shares.

1.10 Dividend Policy

The Company anticipates that significant expenditure will be incurred in the evaluation and development of the Project. The capacity to pay dividends will depend on a number of factors including future earnings, capital expenditure requirements and the financial position of the Company. The Directors do not expect to declare any dividends during the two year period following the issue of this Prospectus and are unable, at this time, to suggest when a dividend may be declared.

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1.11 Financial Forecasts

The Directors have considered the matters set out in ASIC Policy Statement 170 and believe that they do not have a reasonable basis to forecast future earnings on the basis that the proposed operations of the Company being mineral exploration are inherently uncertain. Accordingly, any forecast or projected information would contain such a broad range of potential outcomes and possibilities that it is not possible to prepare a reliable forecast or projection.

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SECTION 2 Details of the Offer

2.1 Description of the Offer

Pursuant to this Prospectus, the Company invites public investors to subscribe for a minimum of 12,500,000 Shares at an issue price of 20 cents each to raise $2,500,000 before the costs of the Offer.

Members of the public who wish to subscribe for Shares pursuant to the Offer must make an Application on the Application Form enclosed with this Prospectus.

The Directors may reject any Application made under the Offer or allocate fewer Shares than the number of Shares applied for.

From their date of issue the Shares offered by this Prospectus will rank equally with Existing Shares. The rights attaching to the Shares offered by this Prospectus are summarised in Section 8.5.

2.2 Indicative Dates

Prospectus lodged with the ASIC	30 October 2007
Applications open	7 November 2007
General Meeting to consider Resolutions	26 November 2007
Applications close	10 December 2007
Allotment of Shares under this Prospectus	14 December 2007
Expected date of commencement of trading of Shares on ASX	18 December 2007

These dates are indicative only and may vary. The Company reserves the right to vary the opening and closing dates of the Offer without prior notice. Applicants are encouraged to apply as soon as possible after the Offer opens as the Offer may close earlier than the date specified above. The Company also reserves the right not to continue with the Offer at any time before the allotment of Shares and Options to successful Applicants.

2.4 Applications

Investors who wish to apply for Shares in the Offer, should complete the Application Form attached to this Prospectus.

The Offer is for 12,500,000 Shares.

Applicants may apply for a minimum parcel of 10,000 Shares representing a minimum investment of $2,000. Applicants requiring additional Shares must apply for Shares in multiples of 500 Shares (equivalent to $100) thereafter.

To apply for Shares offered pursuant to the Offer made under this Prospectus, the Application Form accompanying this Prospectus must be completed in accordance with the instructions accompanying it and lodged at the following address, on or before the Closing Date:

Patersons Securities Limited Level 23, Exchange Plaza

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2 The Esplanade Perth WA 6000 AUSTRALIA

or

Patersons Securities Limited GPO Box W2024 Perth WA 6846 AUSTRALIA

Applications must be accompanied by payment in full in Australian currency of 20 cents for each Share applied for. Payment must be by way of cheque or bank draft drawn on and payable on an Australian bank and should be made payable to " Altera Capital Limited – Share Issue Account " and crossed 'Not Negotiable'.

No brokerage or stamp duty is payable by Applicants in respect of their Applications for Shares under this Prospectus. The amount payable on Application will not vary during the period of the Offer and no further amount is payable on allotment.

Applicants under the Offer must apply for a minimum of 10,000 Shares representing a minimum investment of $2,000. Applicants requiring additional Shares must apply for additional Shares in multiples of 500 thereafter.

A duly completed and lodged Application Form will constitute an offer by the Applicant to subscribe for the number of Shares applied for pursuant to the Application Form as the case may be.

Application Forms must not be circulated to prospective investors unless accompanied by a copy of this Prospectus.

2.5 Minimum Subscription

The minimum subscription to be raised pursuant to this Prospectus is $2,500,000. No Shares will be issued under this Prospectus unless the minimum subscription is reached by 4 January 2008 (or such later date as agreed between the Company, ABM Resources and Rare Resources provided that the date is no longer than 4 months after the date of this Prospectus). Interest will not be paid on Application monies refunded.

2.6 Allotment of Shares

The acceptance of Applications and the allocation of Shares are at the discretion of the Directors of the Company. The Company reserves the right to allot to an Applicant a lesser number of Shares than the number for which the Applicant applies or to reject an Application. If the number of Shares allotted is fewer than the number applied for, surplus Application money will be refunded without interest.

Application money will be held in trust in a subscription account until allotment or, where applicable, it is repaid to the Applicants. The subscription account will be established and kept by the Company on behalf of the Applicants.

All interest earned on all Application moneys (including those which do not result in allotment of Shares) will be retained by the Company.

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2.7 Lead Manager

Patersons Securities Limited has agreed to be the Lead Manager for the Offer. Patersons Securities Limited will receive a lead manager fee of $50,000 and a placement fee of five percent of the total amount raised under the Offer. Further details of the fees to be paid to Patersons Securities Limited and the terms upon which they have agreed to act as Lead Manager are summarised in Section 8.4.

The Offer is not underwritten.

2.8 ASX Quotation

Application will be made by the Company to the ASX, within seven days after the date of this Prospectus, for the Shares offered to be granted official quotation by the ASX.

If the Shares offered pursuant to the Offer are not admitted to quotation by ASX within three months after the date of this Prospectus all Application moneys will be refunded without interest and no Shares will be issued pursuant to this Prospectus.

The fact that ASX may grant quotation of the Company's Shares is not to be taken in any way as an indication of the merits of the Company or the Shares offered pursuant to this Prospectus.

2.9 Restricted Securities

The ASX may, as a condition of granting the Company’s application for official quotation of its Shares, classify certain Shares of the Company as restricted securities. If so, prior to official quotation of the Company’s Shares, the holders of the Shares that are to be classified as restricted securities will be required to enter into appropriate restriction agreements with the Company and an escrow agent.

It is anticipated that the Existing Shares (other than Existing Shares held by Directors), and all Shares to be issued under this Prospectus shall be free of escrow. It is anticipated that the Earn In Shares and some Existing Shares held by Directors (details of which are described in Section 8.8 of this Prospectus) may be subject to escrow.

2.10 Conditions Precedent to the Offer

The Offer of Shares pursuant to this Prospectus is subject to:

(a) the passage of the Resolutions at the General Meeting;
(b) the raising of the minimum subscription of $2,500,000; and
(c) Completion occurring.

No Shares will be issued under this Prospectus unless the above conditions are fulfilled.

If the conditions are not satisfied by 14 January 2008 (or such other date not exceeding 4 months after the date of this Prospectus as is agreed between the Company, ABM Resources and Rare Resources) then the Directors will return all Application moneys to Applicants without interest.

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2.11 CHESS

The Company will apply to ASX to participate in CHESS, operated by ASTC, a wholly owned subsidiary of ASX, in accordance with the Listing Rules and ASTC Settlement Rules.

Under this system, the Company will not issue certificates to investors. Instead, shareholders will receive a statement of their holdings in the Company. If an investor is broker-sponsored, the ASTC will send them a CHESS statement.

The CHESS statement will set out the number of securities allotted to each holder under the Prospectus, give details of the shareholder's holder identification number and give the participant identification number of the sponsor.

If you are registered on the Issuer Sponsored Subregister, your statement will be dispatched by the share registry and will contain the number of securities allotted under the Prospectus and the shareholder's security holder reference number.

A CHESS statement or Issuer Sponsored Statement will routinely be sent to shareholders at the end of any calendar month during which the balance of their holding changes. A shareholder may request a statement at any other time, however a charge may be made for additional statements.

2.11 Overseas Investors

No action has been taken to register or qualify the Shares, the Options or the Offer, or otherwise to permit a public offering of the Shares or Options, in any jurisdiction outside Australia.

The Offer pursuant to an Electronic Prospectus is only available to persons receiving an electronic version of this Prospectus within Australia.

2.12 Enquiries in Relation to the Offer

This Prospectus provides information for potential investors in the Company, and should be read in its entirety. If after reading this Prospectus, you have any questions about any aspect of an investment in the Company, please contact your stockbroker, accountant or independent financial adviser.

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Section 3 Directors and Management

3.1 Directors and Management

Chairman & Executive Director

Mr Godfrey Rule B.Com MICD

Mr Rule with a Bachelor of Commerce from the University of Western Australia has over 30 years experience in the merchant banking and resource industries in Australia and overseas. He has been a founding director of a number of ASX listed resource companies including Gloucester Coal Limited and AMX Resources Limited. Until recently he was chairman of MMC Asset Management and a director of Western Pacific, Symetry and Select Asset Management. Until early 2005, Mr Rule was a director of Orient Resources Holdings Pty Ltd with projects in China. He is currently the chairman of Hub Resources Pty Ltd and a director Mogul Resources Ltd.

Executive Director

Mr Harjinder Kehal B.Sc (Hons). MMEE. MAusIMM. MAIG

Mr Kehal with a Bachelor of Science (Hons) from the University of Western Australia and a Master of Mineral and Energy Economics from Macquarie University, is a geologist with over 20 years experience in precious, base and industrial metals within Australia, India, Vietnam and China. He has extensive experience in project evaluation, feasibility studies, joint venture negotiations and statutory reporting. He was instrumental in the discovery of the one million ounce Golden Cities gold deposit near Kalgoorlie, Western Australia in 1998 in his capacity as Exploration Manager with AMX Resources. Until early 2006 he was the Chief Operating Officer of AXG Mining Ltd. Currently he is managing director of Hub Resources Pty Ltd and a director of Mogul Resources Ltd.

Non Executive Director and Company Secretary

Mr Bradley G. J. Abbott B.Bus. AFCA.

Mr Abbott is the founding director of Abbott’s Pty Ltd, a Chartered Accounting Practice based in Perth, Western Australia. He has been in public accounting since 1975 with main areas of specialty of small business, agriculture, mining and estate planning. Mr Abbott holds a Bachelor of Business degree from Curtin University, is a fellow of the Taxation Institute of Australia and the Institute of Chartered Accountants and is a registered company auditor. Mr Abbott is a director of Pamlteq Limited.

Non Executive Director

Mr Jeremy David Shervington B.Juris, LLB

Mr Shervington operates a legal practice in Western Australia. He specialises in the laws regulating companies and the securities industry in Australia. Mr Shervington has more than 25 years experience as a lawyer, gained since his admission as a Barrister and Solicitor of the Supreme Court of Western Australia. Mr Shervington has since 1985 served as a director of

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various ASX listed companies as well as a number of unlisted public and private companies. Mr Shervington is currently a director of the following ASX listed companies: Prairie Downs Metals Limited, Australian Zircon NL, Emerald Oil & Gas NL, Industrial Minerals Corporation Limited, Western Uranium Limited and Colonial Resources Limited.

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3.2 Short Form Prospectus - Corporate Governance Statement

This Prospectus is a short form prospectus issued in accordance with section 712 of the Corporations Act. This means that this Prospectus does not of itself contain all the information that is generally required to be set out in a document of this type, however, it incorporates by reference, information contained in the Corporate Governance Statement included in the Company’s Annual Report 2007 that was lodged with the ASIC on 28 September 2007.

The information to be incorporated by reference into this Prospectus is the Company’s corporate governance statement, including the extent to which the Company has followed the ASX Corporate Governance Council’s 10 principles of good corporate governance and best practice recommendations. This information will primarily be of interest to investors and their professional advisers or analysts.

Investors and their professional advisers are able to obtain a copy of the Corporate Governance Statement included in the Company’s Annual Report 2007 free of charge by contacting the Company directly by telephone on 08 9321 2642 or by email at [email protected]. The Annual Report 2007 is also available by searching the ASIC’s records in relation to the Company’s website, www.alteracapital.com.au.

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Section 4 Independent Geologist’s Report

Malcolm Castle

Consulting Geologist Agricola Mining Consultants Pty Ltd P.O. Box 473, South Perth, WA 6951 Phone: 08 9368 4923 Fax: 08 9368 4932 Mobile: 04 1234 7511 Email: [email protected] ABN: 84 274 218 871

25 October 2007

The Directors Altera Capital Ltd 813 Wellington Street West Perth WA 6005

Dear Sirs,

Re:

INDEPENDENT GEOLOGIST’S REPORT ON THE

MINERAL PROJECTS in WESTERN AUSTRALIA

I have been commissioned by Altera Capital Limited (ACN 082 541 437) (proposed to be renamed Altera Resources Limited )(“ Altera Resources”) to provide an independent technical report on the company’s projects in Western Australia. This report is to be included in a Prospectus to be lodged by Altera Resources with the Australian Securities and Investments Commission (“ASIC”), offering for subscription a maximum of 12.5million Shares at an issue price of $0.20 per Share (the Prospectus), to raise up to a maximum of $2.5 million (before costs associated with the issue) on or about 5 December 2007. The funds raised will be used for the purpose of exploration and evaluation of the mineral properties held by Altera Resources.

Independent Geologist’s Report – Altera Capital Ltd – Page 1

This is not an independent evaluation report, and as such, serves only to comment on the geological setting and proposed exploration programs on the properties, I have not been asked to comment on the potential economic value or financial considerations pertaining to the value of Shares or assets held by Altera Resources in relation to these properties.

Altera Resources is focusing on the search for Broken Hill type silver‐lead‐zinc mineralisation within E09/1074 in the Gascoyne Province of northwest Western Australia. The proposed exploration and development programs are consistent with good industry and technical practice for the evaluation of the mineral potential of the areas.

Details in respect to the legal status and tenure of the tenements comprising the Projects have not been considered in this report.

DECLARATIONS

Relevant codes and guidelines

This report has been prepared in accordance with the rules and guidelines issued by such bodies as the ASIC and ASX Limited (“ASX”), which pertain to Independent Expert Reports. Where mineral resources have been referred to in this Report, the classifications are consistent with the Australasian Code for Reporting of Mineral Resources and Ore Reserves (“JORC Code”), prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, the Australian Institute of Geoscientists and the Minerals Council of Australia, effective December 2004. The report complies with section 716(2) of the Corporations Act 2001 where consent is required if unpublished statements have been attributed to third parties.

Under the definition provided by the ASX and in the JORC Code, these properties are classified as ‘exploration projects’, which are inherently speculative in nature. The properties are considered to be sufficiently prospective, subject to varying degrees of risk, to warrant further exploration and development of their economic potential, consistent with the programs proposed by Altera Resources.

Sources of Information

The statements and opinion contained in this report are given in good faith and this review is based on information provided by the title holders, along with technical reports by consultants, previous tenements holders and other relevant published and unpublished data for the area. I have endeavoured, by making all reasonable enquiries, to confirm the authenticity, accuracy and completeness of the technical data upon

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which this report is based. A final draft of this report was provided to Altera Resources, along with a written request to identify any material errors or omissions prior to lodgement.

The independent technical report has been compiled based on information available up to and including the date of this report. Consent has been given for the distribution of this report in the form and context in which it appears. I have no reason to doubt the authenticity or substance of the information provided.

Qualifications and Experience

The person responsible for the preparation of this report is:

Malcolm Castle, B.Sc.(Hons), GCertAppFin (Sec Inst), MAusIMM, MSME

Malcolm Castle has over 40 years experience in exploration geology and property evaluation, working for major companies for 20 years as an exploration geologist. He established a consulting company 20 years ago and specializes in exploration management, technical audit, due diligence and property valuation at all stages of development. He has wide experience in a number of commodities including gold, base metals, iron ore and mineral sands. He has been responsible for project discovery through to feasibility study in Australia, Fiji, Southern Africa and Indonesia and technical Audits in many countries.

Mr Castle completed studies in Applied Geology with the University of New South Wales in 1965 and has been awarded a B.Sc.(Hons) degree. He has completed postgraduate studies with the Securities Institute of Australia in 2001 and has been awarded a Graduate Certificate in Applied Finance and Investment in 2004.

Mr Castle is a Member of the Australasian Institute of Mining and Metallurgy (“AusIMM”) and has the appropriate relevant qualifications, experience, competence and independence to be considered as an “Expert” and “Competent Person” under the Australian Valmin and JORC Codes respectively.

Independence

I am not, nor intend to be a director, officer or other direct employee of Altera Resources and have no material interest in the Projects or Altera Resources. The relationship with Altera Resources is solely one of professional association between client and independent consultant. The review work and this report are prepared in

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return for professional fees based upon agreed commercial rates and the payment of these fees is in no way contingent on the results of this Report.

Yours faithfully

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Malcolm Castle

B.Sc.(Hons) MAusIMM, MSME GCertAppFin (Sec Inst)

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TABLE OF CONTENTS Malcolm Castle ............................................................................................................... 1 GASCOYNE PROJECT ........................................................................................................... 6 Broken Hill Type Mineralisation...................................................................................... 6 Geology ....................................................................................................................... 6 SEDEX mineralisation.................................................................................................. 7 Metamorphic overprints............................................................................................. 7 Metasomatism............................................................................................................ 8 LOCATION and TENURE .................................................................................................. 8 REGIONAL SETTING......................................................................................................... 9 LOCAL GEOLOGY OF THE PROJECT AREA...................................................................... 12 Previous Exploration..................................................................................................... 13 Tantalum/Niobium.................................................................................................... 13 Gahnite Sampling...................................................................................................... 13 Reconnaissance Geochemistry ................................................................................. 14 Gravity Survey........................................................................................................... 15 Recent Exploration.................................................................................................... 16 Exploration Potential .................................................................................................... 17 Exploration Budget ....................................................................................................... 18 REFERENCES...................................................................................................................... 19 GLOSSARY OF TECHNICAL TERMS..................................................................................... 20

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GASCOYNE PROJECT

Earlier exploration has assessed the Gascoyne Province to be prospective for Broken Hill Type Ag‐Pb‐Zn (BHT) mineralisation. This work was generally focussed on the eastern and southern portions of the Province.

According to data provided by ABM in relation to previous exploration a study of Zn‐ bearing spinels (gahnites) in the late 1990s highlighted the potential of the Gascoyne Province for this style of mineralisation. The presence of gahnites is interpreted to be related to Proterozoic BHT mineralisation, although the provenance of the minerals was not clear.

According to the same data provided by ABM, a gahnite study and a review of the BHT Ag‐Pb‐Zn potential of the Gascoyne Province was undertaken in 2003. This study highlighted the prospectivity of the Proterozoic Morrissey Metamorphic Suite in the northwest of the Province.

A detailed airborne magnetometric survey by ABM indicated the structure of the area was followed by a west northwest striking domal feature and the lithologies are probably siliceous, clastic sediments. The southern margin of the antiform has been transected by a west northwest striking shear, whilst the western part of the dome has undergone a later stage folding regime and the intrusion of a granitoid. BHT mineralisation is predominantly hosted at a major stratigraphic break, and remobilised or offset into both the hangingwall and footwall.

BROKEN HILL TYPE MINERALISATION

GEOLOGY

The Broken Hill ore body in far western New South Wales is hosted within the gneisses of the Willyama Supergroup, a mesoproterozoic sequence of quartz‐rich feldspathic gneisses of interpreted sandstone protolith, and micaceous gneisses of siltstone protolith. The Broken Hill ore deposit is considered to be roughly 1,800 million years old.

The simplified geology of the Broken Hill ore body is a series of boomerang‐shaped, highly sheared and disrupted ribbon‐like and poddy massive sulfide lenses which outcropped in the central section (the old "Broken Hills" gossan hills) and plunge steeply north and moderately south.

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The ore consists of massive, recrystallised sphalerite‐rich, galena‐sphalerite and galena‐ rich sulfide lenses often consisting of up to 100% lead‐zinc sulfides, with little or no pyrite, chalcopyrite or gangue sulfides. The ore is hosted within a unit of gneiss known as the Potosi Gneiss.

The footwall to the mineralization is a psammopelite gneiss, consisting of feldspar, quartz, garnet, biotite and amphibole, with a pelite gneiss on the hanging wall. The footwall gneiss contains anomalous mineral chemistries including a rare lead‐rich feldspar and manganese‐rich garnet chemistries.

Ore is predominantly hosted at this stratigraphic break, but much of the ore body is structurally remobilised or offset into both the hangingwall and footwall, and the geometry of the ore deposit is particularly complex on the local scale.

SEDEX MINERALISATION

Broken Hill is widely considered to be a sedimentary exhalative (SEDEX) deposit which has been extensively reworked and modified by metamorphism and shearing. Key evidence for this over‐arching theory includes the association of silver, lead and zinc, which is found in many other SEDEX deposits worldwide and the position of the bulk of mineralization at a key stratigraphic contact between psammite and psammopelite gneisses.

The Potosi Gneiss, and the manganiferous garnet horizon, are considered key indicators of original bedding orientation (S0) and are thus key exploration targets, as there is a proven association of anomalous lead and zinc within the gneissic stratigraphy with these horizons on a regional basis.

METAMORPHIC OVERPRINTS

The Broken Hill ore deposit is hosted within the Proterozoic gneisses of the Broken Hill Block, adjacent to the Curnamona Craton in South Australia. The terrane in which Broken Hill is hosted has undergone a series of several metamorphic deformations at amphibolite facies. This has resulted in the 'squeezing of the lead and zinc sulfides into the current basic boomerang shape, and resulted in the separation of the ore body into zinc‐rich and lead‐rich lodes and domains.

The lodes themselves show various structural facies, and show variable responses to shearing, though mostly in a ductile fashion. Many lodes, particularly the lead lodes, have sharp contacts with gneissic host rocks, indicating they have become structurally

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relocated during peak metamorphism. Similarly, it is conjectured that the current position of the zinc and lead lodes at Broken Hill may not necessarily be related to their original position along the bedding planes, or vertically within the stratigraphic section.

METASOMATISM

The lower part of the Willyama Supergroup has undergone intense sodium alteration, particularly the Broken Hill Block and subdomain. This has resulted in pervasive albite alteration particularly in the Olary domain adjacent to Broken Hill.

The influence of high‐temperature metamorphic fluids on the ore deposit cannot be discounted, although it is considered less central to genetic factors than previous theories of hydrothermal origins for the deposits. The current consensus view is that metasomatic overprints are present as a result of the focusing of flow through the zones of weakness around the massive sulfides, which are ductile failure loci in themselves.

Metasomatic effects include re‐equilibrating isotopic systematics of the lead‐zinc sulfides and wall‐rocks, and introduction of rare elements into the sulfide bodies to form one of the most diverse mineralogical assemblages in the Earth's crust, with 1500 or more mineral species recognized at Broken Hill, including several dozen not reported elsewhere.

The association of the Broken Hill line of lode with a horizon of manganiferous garnets is considered to be partly a function of a potential protolith of exhalative manganiferous chert, metamorphically upgraded to a garnetiferous gneiss, and perhaps some reconsititution of that protolith by metasomatism associated with the nearby massive sulfides.

LOCATION AND TENURE

The Gascoyne project is located approximately 100km north of the township of Gascoyne Junction and 250 km to the east Carnarvon, Western Australia. It comprises of tenements Exploration Licence 09/1074, Exploration Licence 09/1266 and Mining Licence 09/62 (Figure 1). The project covers an area of approximately 370 km[2] in the region west of the Lockyer Range.

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Figure 1 – Location of Tenements

REGIONAL SETTING

The Gascoyne Project lies within the Gascoyne Province which is the deformed and high‐ grade metamorphic core zone of the early Proterozioc Capricorn Orogen. The province comprises of voluminous

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Figure 2 – Geological Framework and Project Location

granitoid intrusions, mantled‐gneiss domes, metamorphosed and partly melted sedimentary rocks, and remobilized Archaean basement gneiss. It lies between the Pilbara Craton and Yilgarn Block and tectonic trends within the Gascoyne Province wrap around the margins of these relatively stable cratons (Figure 2)

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A group of ensialic, geosynclinal shelf and trough sedimentary rocks named the Morrissey Metamorphic Suite extends throughout the Province and was probably deposited on Archaean continental crust. The Archean basement is extensively remobilized and this, together with repeated deformation and amphibolite‐facies metamorphism of the Morrissey Metamorphic Suite, is largely attributed to the emplacement of mantled‐gneiss domes and granitoid batholiths (Figure 3).

The key aspects of the geology of the Gascoyne Province include the following aspects.

There are 3 main zones of supracrustal rocks defined within the Gascoyne Province referred to as the Northern, Central and Southern zones.
There are complex fold patterns with variable plunges; however there is a dominant west northwest grain to the country and widespread granite gneisses formed before or during the first episode of deformation
The Morrissey Metamorphic Suite comprises a range of lithologies, including pelitic gneisses and schists, quartzo‐feldspathic gneisses‐schists, quartzite, meta‐ arkoses with lesser calc‐silicate gneiss‐granofels, marble, amphibolite, and minor BIF.
Amphibolites occur mostly as narrow units concordant to gneissic banding. Overall they form a minor component of the Morrissey Metamorphic Suite. The only area with large bodies of amphibolite occurs between the Nardoo and Injinu Belts, where the amphibolite is intercalated with pelitic schist.
Possible Broken Hill Type mineralisation source rocks such as meta‐arkoses are widespread in the northern zone and the Gascoyne Province contains numerous epigenetic Ag‐Pb‐Zn occurrences.

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Figure 3 – Regional Geology of the Gascoyne Province

LOCAL GEOLOGY OF THE PROJECT AREA

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The Morrissey Metamorphic Suite within the Project area consists of four main units. The dominant unit is a quartz‐microcline‐oligoclase‐biotite‐muscovite paragneiss and schist (interpreted protolith is an arkose). This unit is widespread within the Mt Phillips 1:250,000 sheet area. Forming a subordinate unit is a quartz‐biotite‐muscovite‐feldspar‐ garnet paragneiss‐schist with intercalated quartzite and micaceous quartzite. A large oval body of migmatite and gneissic granodiorite occurs within the eastern portion of the Project area, which coincides with a distinctive magnetic ovoid.

A large area of Permian sediments (glacigene sandstone, siltstone and tillite) runs north‐ south across the western portions of the Project area. The thicknesses of these units are unknown.

Pegmatite veins in this region tend to be quartz rich and are intimately associated with the northwest trending shears. Quartz veins or lenses occur as sinuous outcrops parallel to the regional strike or as en echelon sets almost orthogonal to the shear. The veins at Nardoo Hill Well are of the second type and are less than 100m in length and 1‐8m in thickness.

There are no known base or precious metal occurrences within the project area.

PREVIOUS EXPLORATION

TANTALUM/NIOBIUM

The project area hosts numerous pegmatite occurrences of varying sizes. Arthur River mining lease 09/62 has been targeted for the exploration and extraction of columbite/tanatalite from alluvial/eluvial and primary sources for the last 40 years. It appears from data provided by ABM that some high grade columbite samples and production has been won from this area by prospecting syndicates and junior companies using a small plant with trommel and jig apparatus type setup. The high grade columbite concentrate produced from Arthur River contained 67% Nb2O5 and has favourable smelting characteristics for the production of ferro‐niobium. It is difficult to establish the total material mined for the extraction of tantalite and columbite from Arthur River however the majority of open file reports contain proposals to undertake exploration programs and bulk sampling programs to establish sizeable resources that could then be mined to produce columbite and tantalite. Heightened interest in this area has usually coincided with rise in the price of tantalum and niobium prices.

GAHNITE SAMPLING

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According to previous exploration data provided by ABM a study of heavy mineral samples collected from earlier diamond exploration was undertaken to identify anomalous gahnite‐bearing samples possibly related to BHT mineralisation . Gahnites are not widespread across the Gascoyne Province, despite quite detailed heavy minerals sampling.

Gahnite (zinc aluminium oxide) is one of the rarer members of the spinel group of minerals, an important group of oxides. Gahnite forms in some granitic pegmatites, zinc deposits and in skarns, a type of contact metamorphic rock

The gahnites identified in the northwest of the Province are interpreted to be shedding from the Proterozoic Morrissey Metamorphic Suite, which is considered prospective for BHT mineralisation.

RECONNAISSANCE GEOCHEMISTRY

Much of the Gascoyne Province is covered by semi‐regional stream sediment sampling collected by the Geological Survey of Western Australia (GSWA). The GSWA sampling covers both the Mount Phillips and Robinson Range sheets. Sample density averaged 1 sample per 16 km[2] and at each site 1.5 kg was sieved to between 0.45mm and 2.0mm and analysed.

Within the Gascoyne Project area, the GSWA sampling highlights a cluster of samples with elevated silver, lead and palladium which are coincident with the prospective gahnite samples.

According to information provided by ABM an initial field reconnaissance in the NW corner of the Gascoyne Province, completed in 2003 , consisted of soil sampling, rock sampling and geological traversing, including the collection of 17 soil and 15 rock samples within the project area.

This reconnaissance work defined a 6 km long Pb‐Zn‐Cu soil anomaly coincident with gahnite‐bearing and Pb‐anomalous drainages. The soil anomalies are coincident with weathered manganiferous and garnetiferous schists/gneisses that have returned up to 990 ppm Pb, as well as gossanous float with up to 0.14% Zn. In order to adequately test the soil and rock anomalism, a ground geophysical survey was planned to delineate targets for further exploration.

The data provided by ABM on a regional diamond‐search program in 2003 reported numerous alluvial/colluvial bulk samples were collected in a locality in the western part of the area. Numerous granite grains were recovered in the heavy mineral fraction. This

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mineral, together with fundamental geology (age and lithology) were reminiscent of the Broken Hill SEDEX massive sulphide mineralizing environment and reconnaissance exploration for that model was initiated. Fifteen rock chip samples taken from the licence were assayed for a suite of elements including Cu, Pb, Zn, Co, Ag, Au, Mn and Ni. Of theses, two samples 8km apart, returned anomalous levels of Co, Cu and Zn whilst the former, in the centre of the licence area had a concentration of 953ppm lead.

Follow‐up exploration included the collection of 17 soil samples along station tracks in the vicinity of the anomalous samples, which were re‐assayed for. Of the follow up samples, three showed elevated Pb‐Zn values and one contained 408ppm Pb and 156ppm Zn.

GRAVITY SURVEY

Data provided by ABM shows that approximately 2500 gravity stations were collected in 2004 over prospective Morrissey Metamorphic Suite stratigraphy. In the west of the survey area, the contact of Proterozoic granitic and gneissic rocks with Lyons Formation (sandstones and siltstones) to the west is clearly defined. A northwest‐trending band of Proterozoic biotitic and granodioritic gneisses transects the survey area. This broad gravity high is associated with strongly magnetic stratigraphy.

Although the gravity survey did not define any clearly anomalous features, six smaller, low priority anomalies were identified that were interpreted as possible deep BHT targets. Two of these six targets are within E09/1074. The gravity targets were modelled with densities of 3.4 g/cc (to approximate BHT mineralisation) against a background of 2.67 g/cc.

The first target in the project area is a 0.25 mGal feature on the edge of the main granodiorite belt. While the mass could be ascribed to a near‐outcropping mass of granodiorite, the magnetics suggests a different composition to the main belt of material.

The second target was selected because of its unusual relationship to the topography. While the gravity high/low of this target is probably an uncorrected topographic effect, the feature may also be indicative of localised alteration and was considered worthy of ground follow‐up.

This survey, whilst covering the area of the soil geochemical anomalism in the west of the project, did not cover the rock chip anomalism in the centre of the tenement.

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Field work indicated that both of the anomalies had extensive outcrop. At the first anomaly weathered laterite, silicified in places, contained weathered fragments of metasedimentary rock and pods of amphibolite. At the second location partially weathered granitic gneiss outcrops with amphibolite pods. The presence of amphibolite rocks was considered sufficient to explain the gravity feature at that time. The analytical results received from the rock chips collected at the areas were not considered to indicate any geochemical anomalism by previous explorers.

RECENT EXPLORATION

A detailed (100m line spacing) airborne magnetic survey was carried out in 2007 by ABM over the northern half of the E09/1074. A reinterpretation of the geology indicated the structure of the area was followed by a west northwest striking (290°) domal feature and the lithologies are probably siliceous, clastic sediments. The southern margin of the antiform has been transected by a west northwest striking shear, whilst the western part of the dome has undergone a later stage folding regime and the intrusion of a granitoid (Figure 4).

Magnetic imagery shows the dome to be cut by several north‐north east trending faults and mafic dykes whilst the north western area (the region of possible intrusion and complex folding) is separated by northwest striking faults. On the northern flank of the dome, in the area of magnetic quiescence, subtle parallel (stratigraphic) linear anomalies can be discerned. Periodically, along some of these linear features are weak but definite “thumbprint” magnetic anomalies. The earlier geochemical sampling was carried out in zones of relative magnetic quiescence to the north and northwest of the dome.

The derivation of the geochemical anomalies in the northwest of the licence area has not been clarified.

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Figure 4 – Geological Interpretation from aeromagnetic data

EXPLORATION POTENTIAL

The Gascoyne Province is considered prospective for BHT mineralisation similar to Cannington and Broken Hill. At this stage stratiform‐stratabound Ag‐Pb‐Zn occurrences have not been discovered, which is typical of other BHT terranes.

The key criteria for BHT ore deposits are;

Association with major sedimentary packages of sandstone protoliths underlying siltstone protolith sequences in highly disturbed metamorphic terranes
A Proterozoic age is considered important, as no other major SEDEX lead‐zinc deposits of this style are known from the Phanerozoic or Archaean
Association with manganiferous garnets.

Reconnaissance sampling data provided by ABM has identified an area of anomalous geochemistry associated with poorly exposed Morrissey Metamorphic Suite stratigraphy considered to be prospective for BHT mineralisation. A ground gravity survey identified 2 low priority targets within the project area, which were followed up with a ground inspection and further geochemistry.

The important features of the Gascoyne Project indicated by earlier work and interpretation are:

A sequence of folded Proterozoic, silicieous, clastic sediments; probable late‐ stage granitoid intrusions.
A series of, apparent stratigraphic, magnetic anomalies.
Granite in heavy mineral concentrations from this region; source not determined.

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Anomalous Pb‐Zn‐Cu‐ values in rock chip and soil samples, some of which appear to be at the same stratigraphic level as magnetic anomalies.
The presence of manganiferous and garnetiferous schists/gneisses.
Zinc spinel (gahnite) minerals interpreted to be shedding from the Proterozoic Morrissey Metamorphic Suite

The gravity survey needs to be reassessed and compared, spatially, with the detailed magnetometric and geochemistry.

EXPLORATION BUDGET

Exploration proposed by Altera will include detailed regolith and geological mapping and systematic surface geochemistry. A review of the aeromagnetic and gravity data and additional geophysical surveys comprising of ground magnetics and EM will be undertaken. This exploration work will define a programme of early drill testing using RC and diamond drilling. Altera proposes to expend, over a period of two years, a total of $1,300,000.

Activity	Year 1	Year 2	Total
Regolith/Geological mapping	10,000		10,000
Soil/rock chip geochemistry	30,000		30,000
Geophysics	100,000	50,000	150,000
RC drilling	160,000	120,000	280,000
Diamond drilling	220,000	250,000	470,000
Geological personnel and technical	140,000	140,000	280,000
support
Administration and overheads	40,000	40,000	80,000
Total	$700,000	600,000	1,300,000

Altera’s proposed expenditure for the Gascoyne Project is warranted and realistic in the context of the equity being raised by the company. The proposed exploration programs may change from that currently stated depending on the results from the Year 1 program. However, it should be possible to fully evaluate the base metal potential of the main target areas within the 2 year period.

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REFERENCES

Muhling, P. 1990. Final Report to the Mines Department on the Mt Clere Property (E52/152 and E52/159‐E52/161). Gascoyne Province, Western Australia. CR 6783.

Nag, S., 2005, “Exploration Licence E09/1074, Gascoyne, Western Australia. Final Joint Venture Report for the Period 28 November 2003 to 30 June 2005.”, unpublished BHP Billiton Minerals Pty Ltd (as provided by ABM).

Rees, B., “Gascoyne Rare Metal Project M09/75 Annual Report to the period tp 27 February 2004”, unpublished, Rare Resources NL

Stewart, L. 1988. Gascoyne Exploration Licences E09/114‐116. Gascoyne Mineral Field, Western Australia. Final Report.

Walters, S.G. 1984. Reconnaissance for Broken Hill Type Mineralisation. Gascoyne Province, Western Australia. CR 4485.

Walters, S.G. 1998. Development of Improved Resistate Indicator Mineral (RIM) Exploration Techniques for Base Metal Deposits. BHP Company Report 8621.

Williams, S.J. 1986. Geology of the Gascoyne Province Western Australia. Geological Survey of Western Australia. Report 15.

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GLOSSARY OF TECHNICAL TERMS

aeolian	Formed or deposited by wind.
aerial photography	Photographs of the earths surface taken from an aircraft.
aeromagnetic	A survey undertaken by helicopter or fixed‐wing aircraft for the
	purpose of recording magnetic characteristics of rocks by measuring
	deviations of the earths magnetic field.
airborne geophysical data	Data pertaining to the physical properties of the earths crust at or near
	surface and collected from an aircraft.
aircore	Drilling method employing a drill bit that yields sample material which
	is delivered to the surface inside the rod string by compressed air.
alluvial	Pertaining to silt, sand and gravel material, transported and deposited
	by a river.
alluvium	Clay silt, sand, gravel, or other rock materials transported by flowing
	water and deposited in comparatively recent geologic time as sorted or
	semi‐sorted sediments in riverbeds, estuaries, and flood plains, on
	lakes, shores and in fans at the base of mountain slopes and estuaries.
alteration	The change in the mineral composition of a rock, commonly due to
	hydrothermal activity.
amphibolite facies	An assemblage of minerals formed at moderate to high temperatures
	(450�C to 700�C) during regional metamorphism.
andesite	An intermediate volcanic rock composed of andesine and one or more
	mafic minerals.
anomalies	An area where exploration has revealed results higher than the local
	background level.
anticline	A fold in the rocks in which strata dip in opposite directions away from
	the central axis.
antiformal	An anticline‐like structure.
Archaean	The oldest rocks of the Precambrian era, older than about 2,500 million
	years.
assayed	The testing and quantification metals of interest within a sample.
Au	Chemical symbol for gold.
auger sampling	A drill sampling method using an auger to penetrate upper horizons
	and obtain a sample from lower in the hole.
axial plane	The plane that intersects the crest or trough of a fold, about which the
	limbs are more or less symmetrically arranged.
basalts	A volcanic rock of low silica (<55%) and high iron and magnesium
	composition, composed primarily of plagioclase and pyroxene.
polymetallics	A non‐precious metal, usually referring to copper, lead and zinc.
bedrock	Any solid rock underlying unconsolidated material.
BIF	A rock consisting essentially of iron oxides and cherty silica, and
	possessing a marked banded appearance.

Independent Geologist’s Report – Altera Capital Ltd – Page 20

BLEG sampling	Bulk leach extractable gold analysis; an analytical method for
	accurately determining low levels of gold.
brittle	Rock deformation characterised by brittle fracturing and brecciation.
Cainozoic	An era of geological time spanning the period from 65 million years ago
	to the present.
carbonate	Rock of sedimentary or hydrothermal origin, composed primarily of
	calcium, magnesium or iron and CO3. Essential component of
	limestones and marbles.
chert	Fine grained sedimentary rock composed of cryptocrystalline silica.
chlorite	A green coloured hydrated aluminium‐iron‐magnesium silicate mineral
	(mica) common in metamorphic rocks.
clastic	Pertaining to a rock made up of fragments or pebbles (clasts).
clays	A fine‐grained, natural, earthy material composed primarily of hydrous
	aluminium silicates.
colluvium	A loose, heterogeneous and incoherent mass of soil material deposited
	by slope processes.
conduits	The main pathways that facilitate the movement of hydrothermal
	fluids.
conglomerate	A rock type composed predominantly of rounded pebbles, cobbles or
	boulders deposited by the action of water.
copper	A reddish metallic element, used as an electrical conductor an the basis
	of brass and bronze.
dacite	An extrusive rock composed mainly of plagioclase, quartz and
	pyroxene or hornblende or both.
depletion	The lack of gold in the near‐surface environment due to leaching
	processes during weathering.
diamond drill hole	Mineral exploration hole completed using a diamond set or diamond
	impregnated bit for retrieving a cylindrical core of rock.
dilational	Open space within a rock mass commonly produced in response to
	folding or faulting.
dolerite	A medium grained mafic intrusive rock composed mostly of pyroxenes
	and sodium‐calcium feldspar.
DoIR	Department of Industry and Resources, WA.
ductile	Deformation of rocks or rock structures involving stretching or bending
	in a plastic manner without breaking.
dykes	A tabular body of intrusive igneous rock, crosscutting the host strata at
	a high angle.
en‐echelon	Repeating parallel, but offset, occurrences of lenticular bodies such as
	ore veins.
erosional	The group of physical and chemical processes by which earth or rock
	material is loosened or dissolved and removed from any part of the
	earths surface.
fault zone	A wide zone of structural dislocation and faulting.
feldspar	A group of rock forming minerals.
felsic	An adjective indicating that a rock contains abundant feldspar and
	silica.
folding	A term applied to the bending of strata or a planar feature about an
	axis.

Independent Geologist’s Report – Altera Capital Ltd – Page 21

foliated	Banded rocks, usually due to crystal differentiation as a result of
	metamorphic processes.
follow‐up	A term used to describe more detailed exploration work over targets
	generated by regional exploration.
g/t	Grams per tonne, a standard volumetric unit for demonstrating the
	concentration of precious metals in a rock.
gabbro	A fine to coarse grained, dark coloured, igneous rock composed mainly
	of calcic plagioclase, clinopyroxene and sometimes olivine.
geochemical	Pertains to the concentration of an element.
geophysical	Pertains to the physical properties of a rock mass.
GIS database	A system devised to present partial data in a series of compatible and
	interactive layers.
gneissic	Coarse grained metamorphic rocks characterised by mineral banding of
	the light and dark coloured constituent minerals.
granite	A coarse‐grained igneous rock containing mainly quartz and feldspar
	minerals and subordinate micas.
granoblastic	A term describing the texture of a metamorphic rock in which the
	crystals are of equal size.
granodiorite	A coarse grained igneous rock composed of quartz, feldspar and
	hornblende and/or biotite.
greenschist	A metamorphosed basic igneous rock which owes its colour and
	schistosity to abundant chlorite.
greenstone belt	A broad term used to describe an elongate belt of rocks that have
	undergone regional metamorphism to greenschist facies.
greywackes	A sandstone like rock, with grains derived from a dominantly volcanic
	origin.
GSWA	Geological Survey of Western Australia.
gypsum	Mineral of hydrated, or water‐containing, calcium sulphate.
halite	Impure salt deposit formed by evaporation.
hangingwall	The mass of rock above a fault, vein or zone of mineralization.
hematite	Iron oxide mineral, Fe2O3.
hinge zone	A zone along a fold where the curvature is at a maximum.
hydrothermal fluids	Pertaining to hot aqueous solutions, usually of magmatic origin, which
	may transport metals and minerals in solution.
igneous	Rocks that have solidified from a magma.
infill	Refers to sampling or drilling undertaken between pre‐existing sample
	points.
insitu	In the natural or original position.
interflow	Refers to the occurrence of other rock types between individual lava
	flows within a stratigraphic sequence.
intermediate	A rock unit which contains a mix of felsic and mafic minerals.
intrusions	A body of igneous rock which has forced itself into pre‐existing rocks.
intrusive contact	The zone around the margins of an intrusive rock.
ironstone	A rock formed by cemented iron oxides.
isoclinal	A series of folds that dip in the same direction at the same angle.
joint venture	A business agreement between two or more commercial entities.
komatiitic	Magnesium‐rich mafic to ultramafic extrusive rock.

Independent Geologist’s Report – Altera Capital Ltd – Page 22

laterite	A cemented residuum of weathering, generally leached in silica with a
	high alumina and/or iron content.
lead	A metallic element, the heaviest and softest of the common metals.
lineament	A significant linear feature of the earth’s crust, usually equating a
	major fault or shear structure.
lithological contacts	The contacts between different rock types.
lithotypes	Rock types.
magnetite	A mineral comprising iron and oxygen which commonly exhibits
	magnetic properties.
metamorphic	A rock that has been altered by physical and chemical processes
	involving heat, pressure and derived fluids.
metasedimentary	A rock formed by metamorphism of sedimentary rocks.
MMI	The collection of soil samples and their analysis, using weak extractive
	reagents, to determine the relative abundance of loosely attached
	trace elemental ions, which frequently define the position of primary
	mineralization.
monzogranite	A granular plutonic rock containing approximately equal amounts of
	orthoclase and plagioclase feldspar, but usually with a low quartz
	content.
Moz	Millions of ounces.
Mt	Million Tonnes.
mylonite	A hard compact rock with a streaky or banded structure produced by
	extreme granulation of the original rock mass in a fault or thrust zone.
nickel	Silvery‐white metal used in alloys.
nickel laterite	Nickel ore hosted within the laterite profile, usually derived from the
	weathering of olivine‐rich ultramafic rocks.
open pit	A mine working or excavation open to the surface.
Orthoimage	A geographically located composite plan using aerial photography as a
	base.
outcrops	Surface expression of underlying rocks.
palaeochannels	An ancient preserved stream or river.
pegmatite	A very coarse grained intrusive igneous rock which commonly occurs in
	dyke‐like bodies containing lithium‐boron‐fluorine‐rare earth bearing
	minerals.
pisolitic	Describes the prevalence of rounded manganese, iron or alumina‐rich
	chemical concretions, frequently comprising the upper portions of a
	laterite profile.
playa lake	Broad shallow lakes that quickly fill with water and quickly evaporate,
	characteristic of deserts.
polymictic	Referring to coarse sedimentary rocks, typically conglomerate,
	containing clasts of many different rock types.
porphyries	Felsic intrusive or sub‐volcanic rock with larger crystals set in a fine
	groundmass.
ppb	Parts per billion; a measure of low level concentration.
Proterozoic	An era of geological time spanning the period from 2,500 million years
	to 570 million years before present.
pyroxenite	A coarse grained igneous intrusive rock dominated by the mineral
	pyroxene.

Independent Geologist’s Report – Altera Capital Ltd – Page 23

quartz reefs	Old mining term used to describe large quartz veins.
quartzofeldspathic	Compositional term relating to rocks containing abundant quartz and
	feldspar, commonly applied to metamorphic and sedimentary rocks.
quartzose	Quartz‐rich, usually relating to clastic sedimentary rocks.
RAB drilling	A relatively inexpensive and less accurate drilling technique involving
	the collection of sample returned by compressed air from outside the
	drill rods.
rafts	A relatively large block of foreign rock incorporated into an intrusive
	magma.
RC drilling	A drilling method in which the fragmented sample is brought to the
	surface inside the drill rods, thereby reducing contamination.
regolith	The layer of unconsolidated material which overlies or covers insitu
	basement rock.
residual	Soil and regolith which has not been transported from its point or
	origin.
resources	Insitu mineral occurrence from which valuable or useful minerals may
	be recovered.
rhyolite	Fine‐grained felsic igneous rock containing high proportion of silica and
	felspar.
rock chip sampling	The collection of rock specimens for mineral analysis.
saline	Salty
saprock	Zone of weathered rock preserved within the weathered profile.
saprolite	Disintegrated, in‐situ rock, partially decomposed by the chemical and
	physical processes of oxidation and weathering.
satellite imagery	The images produced by photography of the earth’s surface from
	satellites.
schist	A crystalline metamorphic rock having a foliated or parallel structure
	due to the recrystallisation of the constituent minerals.
scree	The rubble composed of rocks that have formed down the slope of a
	hill or mountain by physical erosion.
sedimentary	A term describing a rock formed from sediment.
sericite	A white or pale apple green potassium mica, very common as an
	alteration product in metamorphic and hydrothermally altered rocks.
shale	A fine grained, laminated sedimentary rock formed from clay, mud and
	silt.
sheared	A zone in which rocks have been deformed primarily in a ductile
	manner in response to applied stress.
sheet wash	Referring to sediment, usually sand size, deposited over broad areas
	characterised by sheet flood during storm or rain events. Superficial
	deposit formed by low temperature chemical processes associated
	with ground waters, and composed of fine grained, water‐bearing
	minerals of silica.
silcrete	Superficial deposit formed by low temperature chemical processes
	associated with ground waters, and composed of fine grained, water‐
	bearing minerals of silica.
silica	Dioxide of silicon, SiO2, usually found as the various forms of quartz.
sills	Sheets of igneous rock which is flat lying or has intruded parallel to
	stratigraphy.

Independent Geologist’s Report – Altera Capital Ltd – Page 24

silts	Fine‐grained sediments, with a grain size between those of sand and
	clay.
soil sampling	The collection of soil specimens for mineral analysis.
stocks	A small intrusive mass of igneous rock, usually possessing a circular or
	elliptical shape in plan view.
strata	Sedimentary rock layers.
stratigraphic	Composition, sequence and correlation of stratified rocks.
stream sediment sampling The collection of samples of stream sediment with the intention of
	analysing them for trace elements.
strike	Horizontal direction or trend of a geological structure.
subcrop	Poorly exposed bedrock.
sulphide	A general term to cover minerals containing sulphur and commonly
	associated with mineralization.
supergene	Process of mineral enrichment produced by the chemical
	remobilisation of metals in an oxidised or transitional environment.
syenite	An intrusive igneous rock composed essentially of alkali feldspar and
	little or no quartz and ferromagnesian minerals.
syncline	A fold in rocks in which the strata dip inward from both sides towards
	the axis.
talc	A hydrous magnesium silicate, usually formed due to weathering of
	magnesium silicate rocks.
tectonic	Pertaining to the forces involved in or the resulting structures of
	movement in the earth’s crust.
tholeiitic	A descriptive term for a basalt with little or no olivine.
thrust fault	A reverse fault or shear that has a low angle inclination to the
	horizontal.
tremolite	A grey or white metamorphic mica of the amphibole group, usually
	occurring as bladed crystals or fibrous aggregates.
ultramafic	Igneous rocks consisting essentially of ferromagnesian minerals with
	trace quartz and feldspar.
veins	A thin infill of a fissure or crack, commonly bearing quartz.
volcaniclastics	Pertaining to clastic rock containing volcanic material.
volcanics	Formed or derived from a volcano.
zinc	A lustrous, blueish‐white metallic element used in many alloys
	including brass and bronze.

Independent Geologist’s Report – Altera Capital Ltd – Page 25

Section 5 Financial Information

Pro Forma Statement of Financial Position

Set out below, for the purposes of illustration only, is an unaudited pro forma consolidated balance sheet of the Company as at 30 June 2007 taking account the effect of the Offer made pursuant to this Prospectus and assuming Completion has occurred. The pro forma consolidated balance sheet illustrates the effect of the Offer as if the issue of securities under this Prospectus had occurred on 30 June 2007 (based on the assumptions below).

The pro forma consolidated balance sheet presented in this Section should be read in conjunction with Section 7 (Risk Factors) and other information contained in this Prospectus.

The financial information is presented in abbreviated form and does not contain all the disclosures that are usually provided in an annual report prepared in accordance with the Corporations Act.

ALTERA CAPITAL LIMITED CURRENT ASSETS Cash Receivables NON CURRENT ASSETS Interest under Farmin Agreement TOTAL ASSETS CURRENT LIABILITIES Payables (including Capital Raising and requotation costs) TOTAL LIABILITIES NET ASSETS SHAREHOLDERS’ EQUITY Share capital Capital raising expenses Accumulated losses TOTAL SHAREHOLDERS’ EQUITY	30 June 2007 $A 2,602,947 1,741
	2,604,688 50,000
	50,000
	2,654,688
	246,155
	246,155
	246,155
	2,408,533
	4,110,984 (239,910) (1,462,541)
	2,408,533

The pro forma consolidated balance sheet assumes:

(a) completion of the Consolidation;

(b) completion of the Capital Raising of 12,500,000 Shares at an issue price of 20 cents each to raise a total of $2,500,000;

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(b) the issue and allotment by the Company of the Earn In Shares comprising 250,000 Shares to ABM Resources NL;
(c) none of the Existing Options have been exercised; and
(d) the payment of all transaction costs (Lead Manager fees, ASX fees and other expenses totaling $239,910).

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Section 6 Solicitor’s Report on Mining Interests

Jeremy Shervington BARRISTER & SOLICITOR 52 ORD STREET WEST PERTH WA 6005 Telephone: (08) 9481 8760 Facsimile: (08) 9481 5142 E-mail: [email protected]

Our Ref: JDS:20050552

29 October 2007

The Directors Altera Capital Limited 813 Wellington Street WEST PERTH WA 6005

Dear Sirs,

SOLICITORS’ REPORT ON TENEMENTS

1. INTRODUCTION

This report has been prepared for inclusion in the prospectus (“ Prospectus ”) to be issued by Altera Capital Limited (proposed to be renamed Altera Resources Limited) (“ Company ”) for the issue of up to 12,500,000 ordinary fully paid shares at $0.20 per share to raise $2,500,000.

The report relates to mining tenements (“ Tenements ”) held in Western Australia as listed below:

listed below:
Tenement No and Type	Holder and No of Shares Held	Area	Status	Grant Date	Expiry Date
E09/1074	Rare Resources NL	60 blocks	Live	18/08/2004	17/08/2009
E09/1266	ABM Resources NL	70 blocks	Live	02/11/2006	01/11/2011
M09/62	Rare Resources NL	148.05 HA	Live	14/10/1992	13/10/2013

The report considers:

the interests the Company has in the Tenements, including the contracts that materially affect the Tenements, and which are summarised in the Schedule to this report; and
the general native title and indigenous cultural heritage issues that are relevant to the Tenements; and

It is noted that the Tenements are not currently held by the Company but that the Company will acquire an interest in the Tenements under the farm in joint venture agreement which is described in the Schedule to this report.

2. SEARCHES

2.1 Tenement Searches

On 18 October 2007 we conducted searches of the Tenements in the public registers maintained by the Western Australian Department of Industry and Resources (“ DOIR ”). We have not conducted any search of any files or other information relating to the Tenements that may be held by DOIR.

2.2 Native Title Searches

On 18 October 2007 we conducted searches of the National Native Title Tribunal (“ NNTT ”) registers and schedule to determine if any native title applications, native title determinations or Indigenous Land Use Agreements (“ ILUA ”) exist in relation to land the subject of the Tenements.

2.3 Aboriginal Heritage Searches

On 18 October 2007 we conducted an search of the Western Australian Register of Aboriginal Sites through the Aboriginal Heritage Inquiry System for the purpose of identifying any particular Aboriginal cultural heritage issues that may affect the Tenements.

2.4 Land Tenure

We are not instructed to conduct any investigations in relation to the tenure history of the land the subject of the Tenements for the purpose of identifying land in relation to which native title may be extinguished.

2.5 Searches

The information contained within this report relating to the particulars of the Tenements and native title reflects the information contained within the above registers as at the above dates.

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3. OPINION

3.1 As a result of the above searches and our examination of the Material Contracts, we confirm (subject to our comments in this report) that:
(1) The Tenements are in good standing.
(2) The Company’s interest in the Tenements arises pursuant to the farm in joint venture agreement summarised in the Material Contracts summary set out in the Schedule to this report (“ Material Contracts ”). The Material Contracts establish contractual rights to acquire an interest in the Tenements which interest may subsequently be registered on the Tenements.
(3) The Company’s interest in the Tenements is protected by consent caveats lodged with the Department of Industry and Resources pursuant to Section 122A(2) of the Mining Act 1978 (WA) (“Mining Act”) on 22 October 2007.
3.2 A transfer of an interest in the Tenements to the Company will depend on the Company and other parties complying with the applicable terms of the relevant Material Contracts and on the Western Australian Minister for State Development (“ Minister ”) consenting, where required, to the transfer of the relevant interest in the Tenements concerned to the Company. It is noted that the Company’s right to acquire an interest in the Tenements is also subject to the condition that the Company completes a capital raising of at least $2.5 million and its shares be released from suspension from trading on the official list of ASX Limited by 14 January 2008 (“ Listing Condition ”).
3.3 We express no opinion as to whether the Minister will consent to the transfer of the relevant interest in the Tenements, or on whether the Company will ultimately acquire any interest in the Tenements. We also express no opinion on the prospects of the Company fulfilling the Listing Condition.

4. MINING ACT 1978 (WESTERN AUSTRALIA)

The Tenements comprise two exploration licences and a mining lease granted under the Mining Act.

4.1 Rights Conferred by an Exploration Licence

The holder of an exploration licence is authorised to carry out exploratory operations of a kind set out in the Mining Act, subject to the conditions on which the exploration licence is granted, in respect of any minerals except iron ore (unless expressly authorised by the Minister). An exploration licence granted or applied for before 10 February 2006 remains in force for a period of 5 years from the date of grant and may, in certain circumstances, be extended for a further period of 4 years, after which one or more extensions of 1 year are available in exceptional circumstances. An exploration licence applied for on or after 10 February 2006 will remain in force for 5 years from the date of grant and may be renewed by the Minister for 5 years (plus a further 2 years if prescribed grounds exist).

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Exploration licences are described in graticular blocks, which range in area from approximately 2.8 km²to 3.3 km² depending on where the block is located in the State.

4.2 Conversion of Exploration Licence to Mining Lease

Subject to the Mining Act and the conditions of the exploration licence, the holder of an exploration licence generally has the right to apply for and have granted one or more mining leases over the area of land within the area of the exploration licence. If the exploration licence was applied for on or after 10 February 2006, the licensee will need to show both the existence of significant mineralisation in relation to the area to which the mining lease application relates and that the resource will be exploited.

4.3 Rights Conferred by a Mining Lease

Subject to the provisions of the Mining Act, the holder of a mining lease is entitled to work and mine the land, take and remove any minerals (except iron or, unless expressly authorized by the Minister), take and divert water subject to the Rights in Water and Irrigation Act 1914 (WA) and do all things necessary to effectually carry out mining operations in, on or under the land. However, the grant of a mining lease does not in itself confer authority to produce minerals. Further approvals are generally required before production may comment, including environmental approvals.

The holder of a mining lease owns all minerals lawfully mined from the land in accordance with the mining lease. However, a royalty is payable to the Crown in respect of all minerals recovered from a mining lease at the rate prescribed for the relevant commodity in the Mining Act and the Mining Regulations 1981 (WA).

Based on the current provisions of the Mining Act, a mining lease will remain in force for an initial term of 21 years and may be renewed for a further term of 21 years as of right. The Minister may further renew the term of a minng lease for successive periods of 21 years each. A mining lease applied for or granted before 10 February 2006 may have an area not exceeding 10 square kilometers. In respect of mining leases applied for on or after 10 February 2006, the Minister has discretion to grant the mining lease over an area considered appropriate (and including sufficient land to encompass the resource and required infrastructure).

4.4 Section 119(2) – Mining Act / Regulation 110 of Mining Regulations

Section 119(2) of the Mining Act provides that a legal or equitable interest in or affecting a mining tenement is not capable of being created, assigned, affected or dealt with, whether directly or indirectly, except by an instrument in writing signed by the person creating, assigning or otherwise dealing with the interest.

Regulation 110(3) of the Mining Regulations 1981 (WA) provides that “No dealings shall be effectual to pass any estate or interest in a mining tenement or in any way to charge or encumber a mining tenement unless registered in accordance with sub-regulation (2).”

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5. NATIVE TITLE

5.1 Background to native title and the Native Title Act 1993 (Cth)

As a result of the decision handed down in June 1992 by the High Court of Australia in Mabo & Ors v The State of Queensland (No 2) (1992) 175 CLR 1 (“ Mabo” ), Australian common law recognises a form of communal native title rights to land and waters where:

(a) Aboriginal claimants can prove a continuous and substantial connection with the land or waters in accordance with the Aboriginal group's traditional laws and customs; and
(b) the native title rights have not been lawfully extinguished by inconsistent government legislation or executive action.

The content of the native title rights held by an Aboriginal group in relation to particular land or waters depends upon the traditional laws acknowledged by, and the traditional customs observed by, that group. Where native title rights exist in relation to particular land or waters, inconsistent rights and titles (including mining tenements) which have been granted to others in respect of the land or waters, may be invalid.

As a result of Mabo and the operation of the Racial Discrimination Act 1975 (Cth) ( “RDA” ), the validity of mining tenements granted after 31 October 1975 (the date of commencement of the RDA) was rendered uncertain.

In response to this uncertainty, the Federal, State and Territory Governments have enacted legislation which has validated titles (including mining tenements) granted prior to 1 January 1994, which would otherwise have been invalid because of the existence of native title. The Federal Government enacted the Native Title Act 1993 (Cth) ( “NTA” ) and the Western Australian Government enacted the Titles (Validation) and Native Title (Effect of Past Acts) Act 1995 WA ( “Validation Act” ). Consequently, titles (including mining tenements) granted after 31 October 1975 but prior to 1 January 1994 over land or waters in Western Australia in which native title rights may exist have been validated to the extent that they affect existing native title rights. Depending on the type of title involved, validation may have extinguished any existing native title rights.

The validity of the NTA and the fact that it overrides the Land (Titles and Traditional Usage) Act 1993 (WA) ( “Usage Act” ) was determined by the High Court of Australia in March 1995. The determination that the Usage Act is invalid has caused considerable uncertainty as to the validity of titles issued in Western Australia pursuant to the Usage Act in the period 1 January 1994 to 16 March 1995.

The NTA was substantially amended by the Native Title Amendment Act 1998 (Cth) ( “Amendment Act” ) which generally came into effect on 30 September 1998. Both the Amendment Act and the Validation Act ensure the validity of certain "intermediate period" titles granted between 1 January 1994 and 23 December 1996 where native title may have existed.

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The Amendment Act allows States and Territories to enact their own legislation for the performance of certain functions and the exercise of certain powers under the NTA by State and Territory bodies. The Western Australian government has so far failed in its attempts to pass such legislation in various forms.

5.2 Summary of NTA

In summary, the NTA:

(1) provides for the recognition and protection of native title;
(2) establishes mechanisms for determining claims for native title;
(3) makes valid Commonwealth past acts, intermediate period acts and previous exclusive possession acts that might otherwise be invalid because of native title and enables States and Territories to validate these types of acts where they are attributable to a State or Territory;
(4) establishes ways in which future acts may proceed by the provision of procedural rights to native title holders and claimants, including rights to compensation; and
(5) establishes a right to negotiate procedure that provides negotiation and consultation rights for native title holders and claimants in relation to certain future acts such the grant of mining tenements.

The NTA is complicated and much native title law is still uncertain and subject to litigation in the Federal and High Courts.

The NTA only applies to land and waters in respect of which native title rights and interests have not been extinguished by previous extinguishing acts, for example, most grants of freehold title, lands that are appropriated or dedicated for public works, and lands and waters covered by any of the types of interests listed in Part 4 of Schedule 1 to the NTA.

5.3 “Future acts” and the “right to negotiate”

Under the NTA, the grant of a mining tenement on or after 1 January 1994 is a "future act" if native title rights exist in relation to the land and the grant of the tenement would affect the native title rights by extinguishing them, or by being wholly or partially inconsistent with their continued existence, exercise or enjoyment.

The grant or renewal of a tenement for mining purposes over land or waters within the limits of a State or Territory will be a "permissible future act" if it has undergone the “right to negotiate” ( “RTN” ) procedures prescribed in the NTA.

These procedures involve negotiation in “good faith” by mining tenement applicants and the State with the registered native title claimants with a view to obtaining the claimants’ consent to the grant of tenements. Any future act which fails to comply with the procedure will be invalid to the extent that it affects native title. It is possible

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to avoid some of the delay necessitated by the procedure if agreement can be reached with the relevant native title claimants for their consent to the grant of the tenements.

5.4 Registration Test

In order to access the procedural rights under the future act regime, native title claimants must endeavour to have their claim registered. The registration process requires claimant applications to pass the registration test which comprises certain procedural and substantial tests intended to establish a prima facie case for the existence of native title to particular land or waters.

If the registration test is satisfied the claimant application will be entered on the Register of Native Title Claims administered by the NNTT. The claimants will have the status of “registered native title claimants” and will obtain certain negotiation and procedural rights.

Claims which fail to meet the registration test are recorded on the Schedule of Applications Received by the NNTT. Such claims may be entered on the Register at a later date if additional information is provided by the claimant that satisfies the registration test. Claims which are deregistered will lose the right to negotiate from the date of deregistration but will still remain on foot in the Federal Court until such time as they are determined by the Court.

5.5 RTN Procedures

An outline of the procedure is as follows:

The State must give written notice to the public and to the relevant native title parties of its intention to grant the mining tenement ( “Section 29 Notice” ). Any registered native title claimants in relation to the area covered by the proposed tenement must be notified.
Parties affected by the proposed "future act" who have not already made a native title claim over the relevant area have up to 4 months in which to register a new claim in respect of the area and/or to object to the use of the expedited procedure. Any person who becomes a new registered native title claimant within the 4 month period will also be entitled to participate in the process.
The State, the mining tenement applicant and the native title claimants must negotiate in “good faith” with a view to agreeing to the grant of the tenement and applicable terms and conditions of the grant. The parties may also request the National Native Title Tribunal ( “NNTT” ) to mediate.
If the parties fail to reach agreement within 6 months, any party may apply to the NNTT to determine whether the grant should be made and if so, on what terms. The NNTT will have 6 months in which to make its decision. Those “terms” can include the payment of monies to native title groups.

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It is open to the Commonwealth Minister to overrule any determination which the NNTT may make if he or she considers it is in the interests of Australia or the relevant State to do so.
As noted further below, the State may seek to invoke the expedited procedure provided by the NTA.

These procedures may include negotiations about the grant or renewal with native title claimants or holders in relation to the particular land or waters. It is possible that a grant or renewal may be denied if it is vigorously opposed in circumstances where the grant of the tenement would adversely affect native title. It is also possible that compensation may be payable by the Company to the native title holders or claimants (to be held on trust, pending a determination as to the actual existence of native title) as a precondition to the grant or renewal being accepted.

The NTA also provides a fast-tracking process known as the expedited procedure ( “EP” ) for the grant of lower-impact future acts to which the RTN applies. The EP is activated at the discretion of the Government in relation to future acts that it considers are not likely to interfere with any native title claimants’ or holders’ community or social activities, or Aboriginal sites, or involve major disturbance to land or waters. If asserted by the Government, the EP operates during the beginning of the TRN process. To date, the Government has not sought to apply the EP in relation to the grant of any form of mining tenement and consequently, no low-impact grant regime is available for such applications. However, the EP has been successfully applied to exploration licences and prospecting licences.

5.6 West Australian Government Policy in relation to Exploration Licenses, Aboriginal Heritage and Native Title

As discussed, under the NTA certain native title parties must be notified of the intended grant of exploration and prospecting licences. If the Government, as the grantor of the licences, states that the EP applies to the grants in order to try to expedite the grant process, native title parties can object to the application of the EP by lodging an objection with the NNTT.

On 30 October 2003, the Western Australian Government announced that Western Australia’s mining industry, native title claimants and the Government have reached agreement in relation to an Aboriginal Heritage Protection template that will speed up land access for developers. A variation of these Heritage Protection templates are to be used all over the State.

The Government announced that the key elements of the agreement include:

A commitment to co-operate to ensure the ongoing protection of Aboriginal heritage;
An obligation to take into account activities that could significantly affect cultural heritage values. Parties must discuss proposed activities and conduct heritage

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surveys where appropriate. This joint decision must take into account whether there have been previous surveys or an area has been previously disturbed;

Capped daily rates for survey cots, agreed by both parties. Rates are region specific and administration fees are capped;
Certainty for exploration and prospecting companies and individuals in undertaking activities for the life of the tenement;
Information to be entered by the Department of Indigenous Affairs ( “DIA” ) into a heritage survey database to assist miners when seeking access to land; and
Once-only execution of agreements for multiple exploration and prospecting licences within a claim area.

The new policy means that applicants for exploration licences must sign a Heritage Protection Agreement (either the template prepared by the Government or an alternative agreement that satisfies the Government’s requirements) before the Government will invoke the EP in relation to the tenement applications. If the prospector or developer will not enter into such an agreement, then the tenement application will have to be processed in accordance with the RTN procedure.

The practical effect of the negotiated Heritage Protection template is that if an explorer or prospector signs the template agreement (or a similar agreement) with the relevant native title parties, the Government will state that the EP should apply to that licence, and the native title parties for the area affected by the licence will agree not to make an objection, or to withdraw any objection they have lodged, against the licence. This in turn facilitates the rapid grant of the licence.

The incentive for the native title parties to agree the Heritage Protection Agreement template is that the indigenous heritage issues which concern them and that can arise as a result of the potential impact of the licences on land and waters can be negotiated and resolved up front. The benefit for prospectors and explorers is the certainty that those heritage issues have been dealt with, that there will be no objections to the grant, and that they will obtain their licences rapidly without getting bogged down in technical issues.

5.7 Validity

Where the RTN applies, the applicant of the relevant future act and the State must fully comply with the NTA procedural requirements, in order to ensure that the grant of the future act is valid with respect to native title.

5.8 Compensation

Where a future act has occurred and the NTA, if relevant, has been complied with, a right of compensation may exist for the impact of the future act upon native title.

Under section 125 of the Mining Act the applicant for a mining tenement or the holder of a mining tenement is liable to pay compensation to any native title holders for or in

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respect of the grant of the tenement and its impairment or extinguishment of native title rights and interests. If at the time the compensation payment is to be made the tenement has expired, been forfeited or surrendered, the holder of the mining tenement immediately before its surrender, forfeiture or expiry is liable to pay compensation to pay native title holders. Under section 8 of the Mining Act the term mining tenement is defined to mean a prospecting licence, an exploration licence, a retention licence, a mining lease, a general purpose lease or a miscellaneous licence granted or acquired under that Act, or by virtue of the Mining Act 1904 (WA).

It is not currently possible to assess the likelihood or quantum of a determination that compensation is payable to native title holders in relation to the Tenements.

5.9 Native Title Claims

Native title claims may be initiated in the Supreme Courts of the States and Territories, and in the Federal and High Courts, or may be made to the NNTT.

We have reviewed information obtained from the NNTT regarding native title claims which affect the Tenements, and details of the one native title determination application overlapping all three Tenements are set out below in Section 6.

The following qualifications apply to our review of native title claims affecting the Tenements:

(a) the records held at the NNTT and available to be searched are not necessarily complete or up to date; and
(b) it is always possible that further claims for native title rights may be made in the future in respect of the area covered by the Tenements. We have not undertaken the legal, historical, anthropological and ethnographic research that would be necessary to form an opinion as to whether or not such claims, if made, would succeed and, if they did succeed, what the implications would be for the Company.

In respect of any of the Tenements which is or could be the subject of native title applications, it is impossible at this stage to state what, if any, effect a finding of native title could have on the Company's interests since this would depend, amongst other things, on the nature of the rights exercisable by the native title holders over the area the subject of the relevant tenements.

Under the Mining Act, the holder of a mining tenement is liable to compensate any native title claimants who are subsequently determined to be holders of native title, for impairment to their native title rights and interests as a result of the grant of a mining tenement (s.125A Mining Act). The obligation to pay compensation will arise if and when native title over the area of the tenement(s) is determined to exist.

If native title is found to exist over the Tenements and compensation is payable in respect of the grant of the Tenements the Company will be liable to pay compensation to any native title holders but the extent of that compensation is difficult to assess at

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this stage. There have been no determinations of compensation payable to holders of native title over the Tenements to date.

5.10 Validity of Tenements and Future Renewals or Extensions

M09/62 was granted before 1 January 1994 and after 31 October 1975. Consequently, M09/62 has been validated to the extent that the grant may have affected existing native title rights.

E09/1704 and E09/1266 were each granted after 23 December 1996.

As the grant of E09/1704 and E09/1266 were required to follow the future act procedures in the NTA outlined above we are of the opinion that each grant was a valid future act.

Section 26D(1) of the NTA allows the doing of an act consisting of the creation of a right to mine (which includes exploration) where the area to which the earlier right relates is not extended, the term of the right is not longer than the term of the earlier right, and no rights are created in connection with that right that were not created in connection with the earlier right.

There is a risk that any renewal or extension of E09/1704 and E09/1266 (which were granted after 23 December 1996) will attract the right to negotiate procedure because section 26D(1) of the NTA only applies to a right to mine (which includes exploration) which was granted prior to 23 December 1996.

6. THE TENEMENTS AND NATIVE TITLE

6.1 NNTT search results

The search results provided by the NNTT show that one native title determination application overlaps all three Tenements as follows:

Native Title Determination	Native Title Claim(s)	Registered ILUA
Nil	WC97/28 (Federal Court Number WAD6161/98) (“Gnulli”) Status = registered native title claim	Nil

6.2 Interpretation of NNTT search results

One native title claim exists in respect of the area covered by the Tenements. The consequences of this are dealt with in Section 5.9 above.

We have not been instructed to undertake the considerable legal, historical, anthropological and ethnographic investigations which would be necessary to form an opinion as to the merits or otherwise of any existing or future claim for native title in

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respect of the land the subject of the Tenements or the implications for the Company’s interests and operations in the event of a determination of native title in any of the area covered by the Tenements. It is possible that additional native title claims may be made in the future over areas where native title has yet to be determined, or that an application to vary or revoke a native title determination may be made to the Federal Court in respect of areas where a determination has been made.

6.3 Aboriginal Heritage Protection Agreements

The Tenements are currently not the subject of any Aboriginal Heritage Protection Agreement.

7. HERITAGE & OTHER LEGISLATION

7.1 Aboriginal Heritage Act 1974 (WA)

Significant Aboriginal sites and objects are protected by the provisions of the Western Australian Aboriginal Heritage Act 1972 (“ AHA” ).

The AHA protects sites and areas of significance to Aboriginal persons. Where any use of the land is likely to result in damage to or destruction of an Aboriginal site or any objects on or under that site, or any person assuming the possession, custody or control of such object, the consent of the relevant Minister is required.

The AHA allows the Governor in Council to declare an Aboriginal site to be a protected area and make regulations prohibiting or imposing conditions on activities within the area or on people entering the area.

A Register of Aboriginal Sites is maintained by the Department of Indigenous Affairs. A search of the register with respect to each of the Tenements was conducted on 18 October 2007. Those searches indicated that there are no registered Aboriginal sites located on the Tenements.

The Department of Indigenous Affairs search results warn that:

“Sites may exist that are not yet entered into the Register system, or are on the Register and no longer exist. The Aboriginal Heritage Act 1972 protects all Aboriginal sites in Western Australia whether they are known to the Department of Indigenous Affairs / Aboriginal Culture Material Committee or not. On-going consultation with relevant Aboriginal communities is required to identify any additional sites that may exist.

DOIR advises all tenement holders that it expects them to abide by the provisions of AHA. This approach complements the Government’s new policy with respect to mandatory usage of Aboriginal Heritage Protection Agreements if explorers and prospectors wish to use the expedited procedure to have their licences granted quickly.

It should be noted that the AHA applies to all Aboriginal sites and objects whether or not they are registered under the Act.

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It should also be noted that Aboriginal sites can be found anywhere and are protected on both freehold and Crown lands and waters.

7.2 Aboriginal and Torres Strait Islander Heritage Protection Act 1984 (Cth)

The Aboriginal and Torres Strait Islander Heritage Protection Act 1984 (Cth) ( HPA ) establishes the Commonwealth’s Aboriginal heritage regime. It allows declarations to be made which protect or preserve objects or areas which are of significance to Aboriginals, whether situated on private or Crown land.

Two types of declarations may be made in relation to significant Aboriginal objects or Aboriginal areas (being objects or areas of significance to Aboriginals in accordance with Aboriginal tradition) under the HPA:

(i) emergency declarations of preservation (which remain in force for a maximum of 60 days); and
(ii) declarations of preservation (which remain in force for the terms specified in the declarations).

Before making a permanent declaration in relation to an area, the Minister for Aboriginal Affairs must commission a report on the area which addresses specific matters such as the significance of the area, the extent of the area to be protected and the effects of the declaration on any non-Aboriginal interests in the land. Compensation is payable by the Minister for Aboriginal Affairs to a person who is, or is likely to be, affected by a permanent declaration of preservation.

It is an offence to contravene a declaration made under the HPA.

No information has been received by us to indicate whether or not any part of the areas of the Tenements is the subject of any such declarations and we have not conducted any searches in this regard.

8. ENVIRONMENT & REHABILITATION OF LAND

8.1 Statutory requirements in Western Australia require mining tenement lands to be protected and rehabilitated ensuring that environmental damage is avoided or minimal (where authorised). Environmental risks associated with undertaking petroleum operations are an inherent part of the industry and the Company will have to ensure that they are vigilant in relation to all operations conducted on the tenement lands.
8.2 Generally, State and Territory legislation and associated regulations make general provision for the regulation of activities on mining tenement lands. These provisions may require approvals and consents to be obtained before certain lands may be accessed and explored. Government ministers responsible for the Tenements may direct the tenement holders to take specified action to prevent or minimise environmental damage, and direct the licensee or former licensee to rehabilitate the land.

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8.3 In addition, each State and Territory Government may impose a wide range of obligations on tenement holders and operators of mining operations generally to ensure compliance with various environmental standards and requirements.

9. SCOPE OF OPINION

This Report:

(a) relates only to the laws of the State of Western Australia and the federal laws of the Commonwealth of Australia in force at the date of this Report; and
(b) is strictly limited to the matters it deals with and does not extend, by implication or otherwise, to any other matter.

10. ASSUMPTIONS

For the purpose of giving this Report, we have assumed:

(a) that the information provided to us by DOIR is correct and up to date as at 18 October 2007;
(b) that the information provided to us by DIA is correct and up to date as at 18 October 2007;
(c) that the Tenements have been validly granted and (where applicable) renewed by the relevant Minister. The good standing of the Tenements and the holders’ interests in the Tenements are both subject to the holders continuing to comply with the terms and conditions of the Tenements under the provisions of the Mining Act and any regulations made pursuant to the Mining Act;
(d) that the relevant Ministers responsible for administering the Mining Act (“ Ministers” ) and each of the Ministers’ delegates have been validly appointed and have acted within the scope of their respective powers, authorities and discretions in granting the Tenements and in registering, authorising, approving or granting any permission or consent in relation to any dealing or proposed dealing affecting the Tenements;
(e) the accuracy and completeness of any instructions and information we have received from the Company and any of its directors, officers, employees, agents or representatives; and
(f) that the Compny has complied fully with all applicable provisions of the Mining Act and any regulations made pursuant to the Mining Act, and all other relevant legislation, regulations and guidelines relating to the Tenements.

The making of the above assumptions indicates that we have assumed that each matter the subject of those assumptions is true, correct and complete in every particular. That we have made an assumption in this Report does not imply that we have made any enquiry to verify that assumption or that we are not aware of any circumstances which might affect the correctness of the assumption. No assumption specified is limited by reference to any other assumption.

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11. QUALIFICATIONS

This Report is subject to the following qualifications:

(a) we have only made the enquiries described in Section 2 above;
(b) in respect of the Tenements, we have not made any enquiries as to whether the relevant Minister has complied with the notice and other procedures under the NTA before granting the Tenements;
(c) the nature and enforcement of obligations under the contracts referred to in this Report may be affected by the discretion of courts to grant or withhold relief by way of injunction, specific performance or other equitable remedy, by statute of limitation, by estoppel and similar principles, by laws concerning insolvency, bankruptcy, liquidation, receivership, administration or reorganisation, and by other laws affecting creditors’ rights generally;
(d) we have relied on the accuracy and completeness of DOIR searches and on the assumption that they remain current. We note that the records disclosed by those searches may not be up to date and, in particular, documents affecting the Tenements may not have been filed with DOIR immediately or, even if filed, may not have been available for immediate inspection at the time the searches were conducted;
(e) to the extent that any opinion or conclusion is based on the searches referred to in (d) above, that opinion or conclusion is given as at the date of the relevant search. The searches were conducted on 18 October 2007;
(f) there may be equitable or other interests in existence affecting the Tenements which for various reasons are not discoverable by search or enquiry but which may be enforceable against a holder of any interest in the Tenements;
(g) we do not express any opinion as to, and have made no investigation of, the laws of any jurisdiction other than Western Australia and the Commonwealth of Australia; and
(h) the Mining Act stipulates that further Ministerial or other approvals are required before activities can be carried out in relation to a mining tenement on certain types of land. We express no opinion as to whether the Company’s activities are likely to require such approvals or, if they do, whether the approvals will be forthcoming.

12. DISCLOSURE OF INTEREST

12.1 Jeremy Shervington is an existing director of the Company and as at the date of this report, has accrued no monetary remuneration in respect of that position. It is proposed that as from the requotation of the Company’s securities on the Australian Stock Exchange, the directors of the Company will receive directors fees at market levels as disclosed elsewhere in the Prospectus.

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12.2 Jeremy Shervington holds relevant interests in the securities of the Company as at the date of this Prospectus as disclosed elsewhere in the Prospectus.
12.3 Jeremy Shervington has advised the Company concerning the Prospectus, and will be paid usual professional fees for that work of approximately $25,000. The firm of which he is a director will also receive legal fees of approximately $20,000 in connection with the provision of legal services in connection with advice provided in respect of the farm in joint venture agreement and the General Meeting, and other general advice. In addition, in the 2 years before the date of this Prospectus, the firm has received legal fees of $20,325 in connection with the provision of general legal services to the Company. Jeremy Shervington may receive fees for other legal services provided to the Company from time to time, which will be charged at commercial rates.
12.4 Jeremy Shervington has been instructed by the Company to prepare this Report, and will be paid $5,000 for work performed in relation to this Report.

13. RESPONSIBILITY STATEMENT AND CONSENT

In accordance with section 716 of the Corporations Act, Jeremy Shervington has given and has not, before the lodgement of the Prospectus with the Australian Securities and Investments Commission, withdrawn his consent to the issue of the Prospectus with this Report included in the form and context in which it is included.

Yours faithfully

____ JEREMY SHERVINGTON

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SCHEDULE

SUMMARY OF MATERIAL CONTRACTS AFFECTING TENEMENTS

Set out below is a summary of contracts which have been entered into by the Company which may be material and relevant to the Tenements. To fully understand all rights and obligations of a material contract it would be necessary to review it in full and the following summarise should be read in that light.

FARM IN JOINT VENTURE AGREEMENT

Pursuant to an a farm in joint venture agreement executed on 14 September 2007 between the Company, ABM Resources NL and Rare Resources NL (a subsidiary of ABM Resources NL), the Company has acquired the right to acquire a 65% interest in the Gascoyne Base Metals Project. A summary of the material terms of the farm in joint venture agreement is as follows:

(i) by expending no less than $1 million on exploration by January 2011 and by issuing 250,000 Shares to ABM Resources the Company can earn a 65% interest in the Gascoyne Base Metals Project;
(ii) a joint venture with ABM Resources will be formed if and when the Company earns its 65% interest in the Gascoyne Base Metals Project;
(iii) the initial joint venture interests will be:
(1) the Company – 65%;
(2) ABM Resources – 35% comprising:
- A. ABM’s Free Carried Interest; and
- B. ABM’s Remaining Participating Interest

where:

“ABM’s Free Carried Interest” means a 10% Participating Interest owned by ABM Resources in respect of which:

(a) subject to paragraph (b), the holder will not be required to make any contributions to Joint Venture Costs;
(b) no entitlement to any proceeds of Joint Venture Activities will arise unless and until the Payback Amount has been received by Altera;

And which will otherwise have the same attributes, on a pro-rata basis, as the remaining 90% Participating Interests; and

“ABM’s Remaining Participating Interest” means any Participating Interest owned from time to time by ABM Resources other than ABM’s Free Carried Interest; and

“Pay Back Amount” means the amount of all Joint Venture Costs borne by Altera from the Final Decision being made in respect of ABM’s Free Carried Interest which the Parties agree will, in priority to any claims by ABM Resources, be recouped by Altera out of the proceeds of Joint Venture Activities to which ABM Resources would otherwise be entitled; and

“Final Decision” means a decision to proceed with a Bankable Feasibility Study in respect of a Mining Tenement or part of a Mining Tenement;

(iv) the dilution provisions of the joint venture are as follows:
“3.4 Subject to clause 3.5, if a Party ( “Diluting Party” ) does not wish to contribute to the Joint Venture Costs in accordance with its Participating Interest (save for in relation to ABM’s Free Carried Interest) then the Participating Interest of the Diluting Party shall dilute so that its Participating Interest from time to time shall be calculated in accordance with the following formula (and the Participating Interests of the other Party ( “Non-Diluting Party” ) shall increase accordingly:

RE = AC/TC X 100

where:

“RE” is the Participating Interest of the Diluting Party calculated following the application of this formula. In the case of ABM Resources, RE is ABM’S Remaining Participating Interest and will be the amount arrived at as RE by the application of this formula minus 10;
“AC” is the total actual Joint Venture Costs incurred by the Diluting Party between the time the Final Decision is made and the date of calculation adjusted, in the case of ABM, by increasing the actual Joint Venture Costs by 10% of Total Joint Venture Costs and, in the case of Altera Capital, by decreasing actual Joint Venture Costs, plus the Deemed Contribution of the Diluting Party; and
“TC” is the Exploration Costs contributed by all Parties from the Execution Date to the date of making the Final Decision plus Total Joint Venture Costs.

“Total Joint Venture Costs” means total Joint Venture Costs of the Parties incurred between the time of the Final Decision and the date of calculation.

For the purposes of the above formula, the Deemed Contributions of the Parties will be:

Altera Capital:

65% of total Exploration Costs incurred by both Parties as at the time of the Final Decision

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ABM Resources 35% of total Exploration Costs incurred by both Parties as at the time of the Final Decision.

3.5 (a) In the event that ABM’s Participating Interest would otherwise become less than 10% in accordance with clause 3.4 then it will be deemed thereafter to retain a Participating Interest of 10% which will, subject to clause 3.5(b), be “free carried” in respect of any Joint Venture Costs which relate to the period after the date of the election which gives rise to the relevant dilution.
(b) Altera shall be able to recoup the additional Joint Venture Costs it has borne as a result of ABM’s Participating Interest becoming “free carried” pursuant to clause 3.5(a) ( “Free Carry Costs” ) from the proceeds of production from mining on the Mining Tenements ( “Production Proceeds” ). These Free Carry Costs shall be deducted from all Production Proceeds ABM would otherwise be entitled to receive until Altera has recouped all Free Carry Costs.”

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Section 7 Risk Factors

7.1 Introduction

This Section identifies the areas the Directors regard as the major risks associated with an investment in the Company and a summary of the key risks is set out in Section 1.9. Investors should be aware that an investment in the Company involves many risks, which may be higher than the risks associated with an investment in other companies. Intending investors should read the whole of this Prospectus in order to fully appreciate such matters and the manner in which the Company intends to operate before any decision is made to apply for Shares.

There are numerous widespread risks associated with investing in any form of business and with investing in the share market generally. There is also a range of specific risks associated with the Company's business and its involvement in the exploration and mining industry. These risk factors are largely beyond the control of the Company and its Directors because of the nature of the proposed business of the Company. The following summary, which is not exhaustive, represents some of the major risk factors which potential investors need to be aware of.

7.2 General Investment Risk Factors

Factors such as inflation, currency fluctuation, interest rates, market sentiment and commodity prices may have a significant impact on the Company's future revenues. The impact of those factors on the Company's future profitability is to a large extent beyond the control of the Company.

7.3 General Economic Risk

Changes in the general economic climate in which the Company operates may adversely affect the financial performance of the Company. Factors which contribute to that general economic climate include:

contractions in the world economy or increases in the rate of inflation resulting from domestic or international conditions (including movements in domestic interest rates and reduced economic activity);
the level of direct or indirect competition against the Company;
international currency fluctuations;
new or increased government taxes or duties or changes in taxation laws; and
changes in government regulatory policy affecting the industry in which the Company operates and further regulation of the industry generally.

7.4 General Exploration and Development Risks

The future viability and profitability of the Company as an exploration and mining company will be dependent on a number of factors, including, but not limited to, the following:

commodity prices and exchange rates and in particular the price of base metals;
risks inherent in exploration and mining including, among other things, successful exploration and identification of ore reserves, satisfactory performance of mining operations and competent management;
a number of assumptions have been used by the Independent Geologist in the Independent Geologist’s Report. If any of these assumptions are incorrect, whether positive or negative, this will have an effect on any estimates which have been made. Investors must read these assumptions in detail in order to fully understand the manner in which the estimates have been arrived at;
risks associated with obtaining the grant of any mining tenements which are applications or renewal of tenements upon expiry of their current term;
risks associated with not being able to agree on the terms of appropriate land access arrangements, land owners thereby jeopardising the grant of a mining lease over existing exploration tenements;
the risk of material adverse changes in government policies or legislation affecting the level of mining and exploration activities, in particular the transitional requirements to bring the land holding under the new mining legislation and the introduction of State imposed royalties;
environmental management issues with which the Company may be required to comply from time to time;
poor weather conditions over a prolonged period which might adversely affect mining and exploration activities and the timing of earning revenues;
unforseen major failures, breakdowns or repairs required to key items of mining plant and equipment or mine structure resulting in significant delays, notwithstanding regular programs of repair, maintenance and upkeep;
risks associated with projected continuity of an ore deposit, fluctuations in grades and values of the product being mined, and unforeseen operational and technical problems;
risks associated with the grant of approvals required to commence a mining operation, including environmental approvals and the grant of suitable water licences, which may be secured outside anticipated time frames or not at all;
accuracy of capital estimates in the current environment have proven in many cases to be understated. In addition the escalating cost of plant and equipment may make the projects uneconomic; and
operating costs may increase for both materials and labour due to shortages. Rising costs may make the projects uneconomic.

If exploration or mining programmes prove to be unsuccessful, this could result in a diminution of the value of the tenements which could have a negative impact on the Company’s share price. In the event that programmes yield negative results, mining interests may be relinquished either in total or in part thereof and/or the Company may cease funding, even though a viable mineral deposit may be present, but undiscovered.

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7.5 Native Title

Each of the tenements which comprise the Project have been validly granted to the registered holder. However, there can be no guarantee that some of those mining interests will not be challenged or impaired, or that claims for compensation will not be made under the Native Title Act 1993 (Cth) . While the tenements E09/1074 and E09/1266 which comprise part of the Project relate to land which is currently the subject of a native title claims, the Board considers that the clearances, consents and approvals that may be required by the Company in relation to native title, heritage, environmental and related matters are not materially different to those confronting any entity conducting exploration in similar parts of Western Australia.

7.6 Exploration Results

The exploration to date on the Project has generated results from various sampling programmes and surveys allow for preliminary observations about the prospectivity potential of the relevant ground. This may change significantly when new information becomes available as a result of drilling and exploration work. No resources have yet been established.

7.7 Environmental risks

The Company will be subject to environmental regulations. Non-compliance with these could result in a cessation of production and in substantial liabilities.

7.8 Share market conditions

The price of the Company’s Shares when quoted on ASX, will be influenced by international and domestic factors. Should these produce a negative effect on the price, this may also affect the Company’s ability to raise development capital.

In addition, there is no guarantee that ASX will exercise its discretion to lift the suspension of the Company’s Existing Shares and grant quotation of the Shares offered under this Prospectus.

7.9 Acts of terrorism and outbreak of international hostilities

Acts of terrorism or an outbreak of international hostilities may adversely affect the operations of the Company or more generally the operation of global markets, including the stock market.

7.10 Commodity prices

Commodity prices, including the market price of base metals, may substantially impact on the economics of mining projects and hence on exploration and development programs, and consequently on the value of the Company's Share price. Commodity prices react to the economic climate, market forces of supply and demand and other factors beyond the Company's control.

7.11 Financial risks

The Company has limited financial resources. Further development of the Project will be dependant on the Company’s ability to obtain future funding. There can be no assurance that such funding required by the Company will be made available to it and, if such funding is available, that it will be offered on reasonable terms.

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7.12 Government

The impact of actions by the Federal and State governments in Australia may affect the Company's operations, including matters such as land access, compliance with environmental regulation, taxation and royalties. Mining industry activities are subject to discretionary regulations, and approvals and permits required to commence mining operations may not be obtained, or delays may occur in obtaining the grant of such approvals and permits, both of which would have an adverse affect on the Company’s operations. The introduction of any new legislation or regulations could have an adverse affect on the Company's operations.

7.13 Insurance risk

The Company as a participant in exploration programs may become subject to liability for hazards which cannot be insured against or against which it may elect not to be insured because of high premium costs or other reasons. The Company may incur liabilities to third parties (in excess of any insurance cover) arising from pollution or other damage or injury.

7.14 Personnel

The success of the Company's proposed operations depends to some extent on the ability of the Company to attract and retain qualified and capable staff and consultants to perform geological, exploration, analytical, geotechnical, engineering, metallurgical and mining work. In the current tight worldwide conditions for mining personnel, attracting and retaining appropriately experienced staff is particularly difficult.

7.15 Uncertainties of nature

The Company's activities are subject to uncertainties of nature including natural disasters and extreme weather conditions.

7.16 Litigation

Legal proceedings may arise from time to time in the course of the Company's business and, depending on the outcome of such proceedings, the Company may be exposed to liabilities.

7.17 Other risks

The future viability and profitability of the Company is also dependent on a number of other factors affecting performance of all industries and not just the exploration and mining industries, including, but not limited to, the following:

financial failure or default by a participant in any contractual relationships to which the Company is, or may become, a party;
insolvency or other managerial failure by any of the contractors used by the Company in its activities; and
industrial disputation in Australia and overseas.

7.18 Speculative nature of investment

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company or by investors in the Company. The above factors, and others not specifically

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referred to above, may in the future materially affect the financial performance of the Company and the value of the Shares offered under this Prospectus.

Therefore, the Shares to be issued pursuant to this Prospectus carry no guarantee with respect to the payment of dividends, returns of capital or the market value of those.

Potential investors should consider that an investment in the Company is speculative and should consult their professional advisers before deciding whether to apply for Shares in the Company.

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Section 8 Additional Information

8.1 Incorporation

The Company was incorporated on 18 May 1998.

8.2 Company Tax Status and Financial Year

The Company is taxed in Australia as a public company.

The financial year of the Company ends on 30 June annually.

8.3 Legal Proceedings

The Directors are not aware of any litigation of a material nature pending or threatened which may significantly affect the Company.

8.4 Material Contracts

Set out below is a brief summary of certain contracts which have been entered into by the Company and which have been identified as material and relevant to potential investors. To fully understand all rights and obligations of a material contract it would be necessary to review each contract in full and these summaries should be read in that light.

(a) Farmin Agreement

A summary of the Farmin Agreement is set out in schedule to the Solicitor’s Report on Mining Interests in Section 6.

(b) Mandate Letter

Pursuant to a letter from Patersons Securities Limited (“ Patersons” ) accepted by the Company on 23 October 2007 (“ Mandate” ), Patersons has been engaged to act as the Lead Manager to the Offer.

The Lead Manager’s obligations are conditional on (amongst other conditions):

Patersons reviewing and being satisfied with the due diligence process undertaken by the Company;
the Company finalising its capital structure, pricing for the Offer and timing parameters to Paterson's satisfaction; and
compliance of the Offer and the Prospectus with the Listing Rules, the Constitution and the Corporations Act;

The Lead Manager is entitled to receive from the Company a Lead Manager fee of $50,000, and a placement fee of 5% on the total funds raised under the Offer. Patersons is also entitled to be reimbursed for all reasonable out of pocket expenses incurred in carrying out its engagement.

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It is a condition of Patersons’ participation in the engagement that the Company has agreed to indemnify and keep indemnified the Lead Manager, its associates and related companies, its directors, agents and staff against all liabilities, losses, demands, damages, penalties, proceedings, judgements, costs, fees or expenses which may be incurred, suffered, paid or liable to be paid in any jurisdiction directly or indirectly arising out of or in respect of the Mandate, the Offer or any matter or activity referred to or contemplated by the Mandate.

Patersons may terminate the Mandate if (amongst other conditions):

A. the Australian equity market conditions or ASX trading conditions are such that in the bona fide judgement of Patersons they are not conducive to the completion of the Offer or events beyond the control of either the Company or Patersons are so material or adverse so as to make it impracticable or inadvisable to proceed with the Offer;
B. there is a material adverse change in the assets, liabilities or financial position of the Company;
C. default by the Company under the terms of the Mandate;
D. a Director of the Company is charged with an indictable offence or is disqualified from acting as a director of a corporation; or
E. any government agency (including ASIC) commences any public action, hearing or investigation against the Company or any of its directors in their capacity as a director of the Company or announces that it intends to take such action.

The Company has also provided standard representations and warranties to Patersons.

Pursuant to the Mandate, the Company has agreed not to offer, sell or market, contract to sell, otherwise dispose of or announce the sale, directly or indirectly, of any shares in the Company or other securities which are convertible into or exchangeable or contain the right to acquire shares in the Company, without the prior written consent of Patersons for a period of 12 months commencing on the closing date of the Offer. This limitation also applies to any transaction having the economic effect of a sale.

8.5 Rights Attaching to Shares

There is only one class of share on issue in the Company being fully paid ordinary shares. The rights attaching to Shares in the Company are:

(a) set out in the Constitution, a copy of which is available for inspection at the registered office of the Company during normal business hours; and
(b) in certain circumstances, regulated by the Corporations Act, the Listing Rules, the SCH Business Rules and the general law.

The following is a summary of the principal rights of the holders of Shares in the Company.

Voting

Every holder of shares present in person or by proxy, attorney or representative at a meeting of shareholders has one vote on a vote taken by a show of hands, and, on a poll every holder of

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shares who is present in person or by proxy, attorney or representative has one vote for every fully paid share held by him or her, and a proportionate vote for every partly paid share, registered in such shareholder's name on the Company's share register.

A poll may be demanded by the Chairman of the meeting, by any five shareholders entitled to vote on the resolution, or by any one or more shareholders with at least five percent of the votes that may be cast on the resolution on a poll, or by any one or more shareholders who are together entitled to not less than five percent of the total voting rights of, or paid up value of, the shares of all those shareholders having the right to vote at that meeting.

Dividends

Dividends are payable out of the Company's profits and may be declared by the Directors.

Transfer of Shares

A shareholder may transfer shares by a market transfer in accordance with any computerised or electronic system established or recognised by ASX or the Corporations Act for the purpose of facilitating transfers in shares or by an instrument in writing in a form approved by ASX or in any other usual form or in any form approved by the Directors.

The Directors of the Company may refuse to register any transfer of shares, other than a proper SCH transfer (as defined in the Corporations Act), where permitted by the Listing Rules. The Company must not refuse to register or give effect to or delay or in any way interfere with a proper SCH transfer of shares or other securities.

Meetings and Notice

Each shareholder is entitled to receive notice of and to attend general meetings of the Company and to receive all notices, accounts and other documents required to be sent to shareholders under the constitution of the Company, the Corporations Act or the Listing Rules.

Liquidation Rights

The Company will have only one class of shares on issue, which all rank equally in the event of liquidation. Once all the liabilities of the Company are satisfied, a liquidator may, with the authority of a special resolution of shareholders divide the whole or any part of the remaining assets of the Company. The liquidator can with the sanction of a special resolution of the Company’s shareholders vest the whole or any part of the assets in trust for the benefit of shareholders as the liquidator thinks fit, but no shareholder of the Company can be compelled to accept any shares or other securities in respect of which there is any liability.

Shareholder Liability

As the Shares under Offer pursuant to the Prospectus are fully paid shares, they are not subject to any calls for money by the Directors and will therefore not become liable for forfeiture.

Alteration to the Constitution

The Constitution can only be amended by a special resolution passed by at least three quarters of shareholders present and voting at the general meeting. At least 28 days written notice specifying the intention to propose the resolution as a special resolution must be given.

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ASX Listing Rules

Despite anything in the Constitution, if the Listing Rules prohibit an act being done, the act must not be done. Nothing in the Constitution prevents an act being done that the Listing Rules require to be done. If the Listing Rules require an act to be done or not to be done, authority is given for that act to be done or not to be done (as the case may be). If the Listing Rules require the Constitution to contain a provision or not to contain a provision the Constitution is deemed to contain that provision or not to contain that provision (as the case may be). If a provision of the Constitution is or becomes inconsistent with the Listing Rules, the Constitution is deemed not to contain that provision to the extent of the inconsistency.

8.6 Rights Attaching to Existing Options

The Existing Options entitle the holder to subscribe for Shares on the following terms:

(a) Each Option is exercisable on or before 5.00pm Perth time on 8 August 2011
(b) The exercise price of each Option is $0.10 in cash (subject to the passing of the Resolutions at the General Meeting);
(c) The Options held by each holder can be exercised in whole or in part;
(d) The Options can be transferred;
(e) The Options do not confer on the holder any right to participate in dividends until Shares are allotted pursuant to the exercise of the Options;
(f) There will be no participating rights or entitlements inherent in the Options and the holders will not be entitled to participate in new issues of capital which may be offered to Shareholders during the currency of the Options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 7 business days after the issue is announced. This will give Option holders the opportunity (where available) to exercise their Options prior to the date for determining entitlements to participate in any such issue;
(g) In the event of a reorganisation of the issued capital of the Company prior to the expiry of the Options all rights of the Option holder in relation to the Options will be changed to preserve the pre-construction entitlement created by the Options, subject to compliance with the Listing Rules (if applicable);
(g) The number of Shares to be issued pursuant to the exercise of Options will be adjusted for bonus issues made prior to exercise of the Options so that, upon exercise of the Options the number of bonus Shares received by the Option holder will include the number of bonus Shares that would have been issued if the Options had been exercised prior to the record date for the bonus issues. The exercise price of the Options shall not change as a result of any such bonus issue;
(h) In the event of a pro-rata issue to Shareholders (except a bonus issue), the exercise price of the Options will be reduced in accordance with the formula set out in Listing Rule 6.22.2 or as otherwise permitted by the Listing Rules at the time of the pro-rata issue.
(i) Application will not be made for the Options to be granted quotation by ASX;

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8.7 Rights Attaching to Director Options

The Director Options entitle the holder to subscribe for Shares on the following terms:

(a) each Option is exercisable on or before 5.00 pm Perth time on 31 December 2012;
(b) the Options held by each holder can be exercised in whole or in part, and if exercised in part multiples of 10,000 must be exercised on each occasion;
(c) the exercise price of each Option is $0.20;
(d) the Optionholder will be permitted to participate in any new pro-rata issue of securities of the Company on prior exercise of the Options in which case the Optionholder will be afforded the period of at least 9 Business Days prior to and inclusive of the record date to determine entitlements to the issue to exercise the Options;
(e) the Options do not confer on the holder any right to participate in dividends until Shares are allotted pursuant to the exercise of the Options;
(f) in the event of a reorganisation of the issued capital of the Company, the Options will be reorganised in accordance with the Listing Rules (if applicable) and in any case in a manner which will not result in any benefits being conferred on Optionholders which are not conferred on Shareholders;
(g) the number of Shares to be issued pursuant to the exercise of Options will be adjusted for bonus issues made prior to exercise of the Options so that, upon exercise of the Options the number of Shares received by the Optionholder will include the number of bonus Shares that would have been issued if the Options had been exercised prior to the record date for the bonus issues. The exercise price of the Options shall not change as a result of any such bonus issues;
(h) Application will not be made for the Options to be granted quotation by ASX;
(i) subject to paragraph (vii) above the Options do not confer on the holder any right to a change in the exercise price of the Options or a change to the number of underlying securities over which the Options can be exercised.

8.8 Director's Interests

Except as disclosed in this Prospectus, no Director holds, or during the last two years has held, any interest in:

(a) the formation or promotion of the Company;
(b) property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer; or
(c) the Offer;

and no amounts of any kind (whether in cash, Shares or otherwise) have been paid or agreed to be paid to any Director to induce him or her to become, or to qualify as, a director, or

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otherwise for services rendered by him or her in connection with the formation or promotion of the Company or the Offer.

Shareholding Qualifications

The Directors are not required to hold any shares in the Company under the Constitution of the Company, unless a share qualification has been fixed by the Company in general meeting. The Company in general meeting has not made such a determination.

Directors' Holdings

Set out in the table below are details of each of the Directors' relevant interests in the securities of the Company as at the date of this Prospectus:

Director	Relevant Interest in Existing Shares¹	Relevant Interest in Existing Options¹	Relevant Interest in Director Options
GodfreyRule	265,685	525,000	1,000,000
Harjinder Kehal	265,685	525,000	1,000,000
BradleyAbbott	265,685	525,000	1,000,000
Jeremy Shervington	1,505,551	525,000	1,000,000

(1) Subject to the passing of the Resolutions at the General Meeting.

Directors may subscribe for Shares under this Prospectus.

Remuneration of Directors

The Constitution provides that the non-executive directors of the Company may collectively be paid as remuneration for their services a fixed sum not exceeding the aggregate maximum sum per annum from time to time determined by the Company in general meeting. The Company in general meeting last fixed a sum on 29 November 2002 of $55,000 and it is proposed approval will be sought at the Company’s first general meeting following Completion for the remuneration of Directors to be fixed at current market levels.

The Constitution provides that the remuneration of the Managing Director of the Company is to be fixed by the Directors. The Company presently does not have a Managing Director.

A Director may be paid fees or other amounts as the Directors determine where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director. A Director may also be reimbursed for out of pocket expenses incurred as a result of their directorship or any special duties.

The Board has determined that, subject to approval by the Company in general meeting, the remuneration of Directors which will be payable on and from Completion are as follows:

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Director	Base Fee $
GodfreyRule	60,000
Harjinder Kehal	40,000
BradleyAbbott	40,000
Jeremy Shervington	40,000

Related party Transactions

The following related party transaction has taken place.

A legal firm of which Mr Shervington is a director will receive legal fees of approximately $25,000 in connection with the Offer. The firm will also receive legal fees of approximately $20,000 in connection with the provision of legal services in connection with advice provided in respect of the Farmin Agreement and the General Meeting, and other general advice. In addition, in the 2 years before the date of this Prospectus, the firm has received legal fees of $20,325 in connection with the provision of general legal services to the Company. The firm may receive fees for other legal services provided to the Company from time to time which will be rendered under normal terms and conditions and at normal commercial rates. No fee is payable to the firm which is contingent upon the outcome of the Prospectus.

A legal firm of which Mr Shervington is a director has prepared the Solicitor’s Report on Mining Interests included in Section 6 of this Prospectus. In respect of this work the Company has agreed to pay approximately $5,000 for these services.

Abbott’s Pty Ltd which is a company controlled by Mr Abbott will on Completion be paid professional fees of approximately $10,000 in respect of administrative, accounting and secretarial services provided in connection with the Offer. In addition, in the 2 years before the date of this Prospectus, Abbott’s Pty Ltd has received professional fees of $53,565 in connection with the provision of administrative, accounting and secretarial services to the Company. Abbott’s Pty Ltd may receive fees for other administrative, accounting and secretarial services provided to the Company from time to time which will be rendered under normal terms and conditions and at normal commercial rates. No fee is payable to Abbott’s Pty Ltd which is contingent upon the outcome of the Prospectus.

Mr Kehal may receive fees for geological consulting services provided to the Company from time to time which will be rendered under normal terms and conditions and at normal commercial rates. In the 2 years before the date of this Prospectus, Mr Kehal has received consulting fees of $2,436 in connection with the provision of geological consulting services to the Company. No fee is payable to Mr Kehal which is contingent upon the outcome of the Prospectus.

Mr Rule may receives fees for project consulting services provided to the Company from time to time which will be rendered under normal terms and conditions and at normal commercial rates. In the 2 years before the date of this Prospectus, Mr Rule has received consulting fees of $3,250 in connection with the provision of project consulting services to the Company. No fee is payable to Mr Rule which is contingent upon the outcome of the Prospectus.

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8.9 Issue of Earn In Shares

This Prospectus also relates to the issue of a total of 250,000 Shares to ABM Resources NL which on Completion will confer on ABM Resources NL a 1.22% relevant interest in the Company’s Shares.

A summary of the terms of the Farmin Agreement is set out in the schedule to the Solicitor’s Report in Section 6.

8.10 Interests of Named Persons

Except as disclosed in this Prospectus, no promoter or other person named in this Prospectus as performing a function in a professional, advisory or other capacity in connection with the preparation or distribution of this Prospectus holds, or during the last two years has held, any interest in:

(a) the formation or promotion of the Company; or
(b) property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer; or
(c) the Offer;

and no amounts of any kind (whether in cash, Shares or otherwise) have been paid or agreed to be paid to a promoter or any person named in this Prospectus as performing a function in a professional, advisory or other capacity in connection with the preparation or distribution of this Prospectus for services rendered by that person in connection with the formation or promotion of the Company or the Offer.

Patersons Securities Limited has acted as Lead Manager in relation to the Offer. For these services, the Company will pay a Lead Manager Fee of $50,000 and a placement fee of five percent of the amount raised under the Offer by Patersons Securities Limited.

Agricola Mining Consultants Pty Ltd has prepared the Independent Geologist’s Report included in Section 4 of this Prospectus. In respect of this work the Company has agreed to pay approximately $6,000 for these services.

A legal firm of which Mr Shervington is a director has acted as solicitors to the Offer and in that capacity has been involved in undertaking due diligence enquiries in relation to the Prospectus, legal documentation, and providing legal advice to the Company in relation to the Offer. The Company will pay approximately $25,000 to that firm for these services.

The amounts disclosed above are exclusive of any amount of goods and services tax payable by the Company in respect of those amounts.

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8.11 Consents

Each of the parties referred to in this Section:

(a) does not make, or purport to make, any statement in this Prospectus or on which a statement made in the Prospectus is based other than as specified in this Section;
(b) to the maximum extent permitted by law, expressly disclaims and takes no responsibility for any part of this Prospectus other than a reference to its name and a statement included in this Prospectus with the consent of that party as specified in this Section; and
(c) has not authorised or caused the issue of this Prospectus.

Agricola Mining Consultants Pty Ltd has given its written consent to the inclusion in this Prospectus of its Independent Geologist’s Report and all statements referring to it and to the report in the form and context in which they are included and has not withdrawn such consent before lodgement of this Prospectus with the ASIC.

Each of ABM Resources NL and Rare Resources NL has given its written consent to the references to them in Section 1.3 and in the Independent Geologist’s Report in the form and context in which they are named, and the inclusion in Section 1.3 and in the Independent Geologist’s Report of all statements by them or said to be based on statements by them, including references to previous exploration results obtained from work carried out under a previous joint venture of which they were a joint venture party, in the form and context in which they are included in the Prospectus and the Independent Geologist’s Report and has not withdrawn such consent before lodgement of this Prospectus with the ASIC.

Jeremy Shervington has given its written consent to the inclusion in this Prospectus of its Solicitor’s Report on Mining Interests and all statements referring to them and to that report in the form and context in which they are included and has not withdrawn such consent before lodgement of this Prospectus with the ASIC.

Jeremy Shervington has consented in writing to the references to them as Solicitors to the Issue in this Prospectus in the form and context in which they appear.

Mr Kehal has given and, at the time of lodgement of this Prospectus, has not withdrawn, his consent to be named as a competent person (within the meaning of the JORC Code) who contributed to the information relating to the exploration results contained in this Prospectus and the inclusion of the references to him and to that information in the form and context in which they appear.

Stantons International have consented in writing to the references to them as auditors of the Company in the form and context in which they appear.

Each of the following has consented to being named in the Prospectus in the capacity as noted below and to the references to them in this Prospectus in the form and context in which they appear and have not withdrawn such consent prior to the lodgement of this Prospectus with the ASIC:

(i) Advanced Share Registry Services as share registry for the Company; and
(ii) Patersons Securities Limited as Lead Manager.

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There are a number of persons referred to elsewhere in this Prospectus who are not experts and who have not made statements included in this Prospectus. There are no statements made in this Prospectus on the basis of any statements made by those persons. These persons did not consent to being named in the Prospectus and did not authorise or cause the issue of the Prospectus.

8.12 Costs of the Offer

Assuming the Offer made pursuant to this Prospectus is fully subscribed, the total estimated costs of the Offer, including legal fees incurred, registration fees, fees for other advisers, Prospectus design, printing and advertising expenses and other miscellaneous expenses, will be approximately $239,910(exclusive of any goods and services tax which may be payable on that amount) comprising the following:

	$
Lead Manager Fee	50,000
Placement Fee	125,000
Independent Geologist’s Report	6,000
Legal and related costs	30,000
Accounting	14,000
Lodgement and Listing Fees	9,910
Printing and postage	5,000
Total Cost Estimate	239,910

8.12 Electronic Prospectus

Pursuant to Class Order 00/44 the ASIC has exempted compliance with certain provisions of the Corporations Act to allow distribution of an electronic prospectus on the basis of a paper prospectus lodged with the ASIC and the issue of shares in response to an electronic Application Form, subject to compliance with certain provisions.

If you have received this Prospectus as an Electronic Prospectus please ensure that you have received the entire Prospectus accompanied by the Application Form. If you have not, please contact the Company at email at [email protected] or telephone +618 9321 2642 and the Company will send to you free, either a hard copy or a further electronic copy of the Prospectus or both.

The Company reserves the right not to accept an Application Form from a person if it has reason to believe that when that person was given access to the electronic Application Form, it was not provided together with the Electronic Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered. In such a case, the Application monies received will be dealt with in accordance with section 722 of the Corporations Act.

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Section 9 Directors’ Responsibility Statement And Consent

The Directors state that they have made all reasonable enquiries and on that basis have reasonable grounds to believe that no statements made by the Directors in this Prospectus are misleading or deceptive and that in respect of any other statements made in this Prospectus by persons other than Directors, the Directors have made reasonable enquiries and on that basis have reasonable grounds to believe that persons making the statement or statements were competent to make such statements, those persons have given their consent to the statements being included in this Prospectus in the form and context in which they are included and have not withdrawn that consent before lodgement of this Prospectus with the ASIC.

The Prospectus is prepared on the basis that certain matters may be reasonably expected to be known to likely investors or their professional advisers.

Each Director has consented to the lodgement of this Prospectus with the ASIC and has not withdrawn that consent.

Dated this 30[th] day of October 2007

Signed for and on behalf of Altera Capital Limited by Jeremy David Shervington Director

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Section 10 Glossary of Terms

The following terms and abbreviations used in this Prospectus have the following meanings:

ABM Resources

Ag Applicant(s)

Application

Application Form

ASIC

ASTC

ASX

Board Business Day Capital Raising

CHESS Closing Date Co Company or Altera Completion

Consolidation

Constitution

Corporate Governance Statement

Corporations Act

Directors

ABM Resources NL ACN 009 127 020.

Chemical symbol for silver.

Person(s) who submit a valid Application Form pursuant to this Prospectus.

A valid application made to subscribe for a specified number of Shares and Options pursuant to this Prospectus.

Application Form accompanying this Prospectus. Australian Securities and Investments Commission. ASX Settlement and Transfer Corporation Pty Ltd. ASX Limited ACN 008 624 691. Chemical symbol for gold. The board of Directors.

A day on which ASX is open for trading.

Means the proposed issue of 12.5 million to raise $2.5 million under this Prospectus.

Clearing House Electronic Subregister System.

5.00 pm WST on 15 January 2006. Chemical symbol for cobalt. Altera Capital Limited ACN 082 541 437.

The simultaneous occurrence of the events that are required to occur to enable the Capital Raising Shares to be issued and the Shares to be granted quotation by ASX.

A selective reduction of the paid up capital of the Company pursuant to which the paid up capital of the Company will be reduced to approximately $1,540,670 and the number of Shares on issue will be reduced to approximately 7,703,346 Shares.

The constitution of the Company.

The Company’s Corporate Governance Statement contained in the Company’s Annual Report 2007 lodged with ASIC on 28 September 2007.

Corporations Act 2001 (Cth).

Chemical symbol for copper.

The Directors of the Company.

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Director Options 4,000,000 Options to acquire Shares with an expiry date of 31 December 2012 and an exercise price of 20 cents each issued on the terms and conditions set out in Section 8.7.

Electronic Prospectus An electronic version of this Prospectus. Earn In Shares The 250,000 Shares to be issued to ABM Resources under the Farm In Agreement. The Earn In Shares will rank equally with the Existing Shares. Existing Options 2,100,000 Options to acquire Shares with an expiry date of 8 August 2011 and an exercise price of 10 cents each issued on the terms and conditions set out in Section 8.6 (subject to the passage of the Resolutions.

Existing Shares The 7,703,348 Shares on issue following the Capital Reduction.

Exposure Period The period of seven days after lodgement of this Prospectus which may be extended by the ASIC by not more than seven days pursuant to section 727(3) of the Corporations Act.

Farmin Agreement

A farm in joint venture agreement executed on 14 September 2007 between the Company, ABM Resources and Rare Resources, a summary of the terms of which is set out in the schedule to the Solicitor’s Report on Mining Interests in Section 6

Gascoyne Base Metals The project comprising mining tenements M09/62, E09/1074 Project and E09/1266 and described in section 1.3 General Meeting A general meeting of Shareholders to be held on 26 November 2007.

Independent Geologist

Agricola Mining Consultants Pty Ltd.

Independent Geologist’s Means the Report contained in Section 4. Report Inferred Mineral Defined by the JORC Code as “that part of a Mineral Resource Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality or reliability.”

Issue The issue of Shares pursuant to this Prospectus. JORC The Australasian Code for Reporting of Mineral Resources and Ore Reserves of the Australasian Institute of Mining and Metallurgy. Lead Manager Patersons Securities Limited ABN 69 008 896 311. Listing Rules The official listing rules of ASX. Mn Chemical symbol for manganese. Ni Chemical symbol for nickel.

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Offer

Offer The invitation to the public made in this Prospectus to subscribe for Shares. Official List The official list of ASX. Option An option to subscribe for a Share. Pb Chemical symbol for lead ppm Parts per million; a measure of concentration. Project The Gascoyne Base Metals Project Prospectus This Prospectus and includes the Electronic Prospectus. Rare Resources Rare Resources NL ACN 009 260 566, a wholly owned subsidiary of ABM Resources.

Resolutions

The resolutions to be put to Shareholders at the General Meeting including:

(a) the Consolidation;
(b) the issue of the Earn in Shares;
(c) the issue of the 12,500,000 Shares pursuant to this Prospectus;
(d) the issue of the Director Options; and
(e) the change of name of the Company to Altera Resources Limited.

SCH Business Rules

The SCH Business Rules as referred to in the Company's Constitution and which are now known as the ASTC Settlement Rules.

Section A section of this Prospectus.

Share(s) Fully paid ordinary share(s) in the Company. WST Western standard daylight saving time. Zn Chemical symbol for zinc.

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AI assistant

COKAL LIMITED — Capital/Financing Update 2007

64656_rns_2007-10-29_acdcaab2-ede6-459d-84a3-1776ad8696e2.pdf

PROPOSED TO BE RENAMED ALTERA RESOURCES LIMITED

PROSPECTUS

Corporate Directory

DIRECTORS

SHARE REGISTRY

AUDITORS

COMPANY SECRETARY

REGISTERED OFFICE

LEAD MANAGER

HOME EXCHANGE

SOLICITOR TO THE ISSUE

INDEPENDENT GEOLOGIST

SOLICITOR REPORTING ON MINING INTERESTS

ASX CODE

Investment Highlights

Advanced base metals exploration project

Other opportunities

Experienced board and management

Key Investment Risks

Key Offer Statistics

Table of Contents

Letter from the Chairman

Capital Structure

Important Notice

Short Form Prospectus

Privacy Disclosure

Section 1

Overview of the Company

1.1 Company History

1.2

Company Overview and Objectives

1.3

Gascoyne Base Metals Project

Project Overview

Target is Broken Hill SEDEX sulphide deposit

Competent Person’s Statement

1.4 The Offer

1.5

The Purpose of the Offer

1.6

Minimum Subscription and Oversubscriptions

1.7

Expenditure Plans

1.8 Working Capital

1.9

Investment Risks

1.10 Dividend Policy

1.11 Financial Forecasts

SECTION 2

Details of the Offer

2.1 Description of the Offer

2.2 Indicative Dates

2.4

Applications

or

2.5

Minimum Subscription

2.6

Allotment of Shares

2.7 Lead Manager

2.8

ASX Quotation

2.9

Restricted Securities

2.10 Conditions Precedent to the Offer

2.11 CHESS

2.11 Overseas Investors

2.12 Enquiries in Relation to the Offer

Section 3

Directors and Management

3.1 Directors and Management

Chairman & Executive Director

Mr Godfrey Rule B.Com MICD

Executive Director

Mr Harjinder Kehal B.Sc (Hons). MMEE. MAusIMM. MAIG

Non Executive Director and Company Secretary

Mr Bradley G. J. Abbott B.Bus. AFCA.

COKAL LIMITED Capital/Financing Update 2007