DREADNOUGHT RESOURCES LTD - Annual Report 2008

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EROMANGA URANIUM
ANNUAL REPORT 2008
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eromanga uranium limiteD ACN 119 031 864

Highlights	1
Chairman’s Report	2
Managing Director’s Report	4
Project Reviews	6
Tenement Schedule	15
Tenement Locations	16
Financial Report	17
Corporate Governance Statement	18
Directors Report	22
Auditor’s Independence Declaration	27
Income Statement	28
Balance Sheet	29
Statement of Changes in Equity	30
Cash Flow Statement	31
Notes to the Financial Statements	32
Directors Declaration	44
Independent Audit Report	45
ASX Additional Information	48

asX coDe - ero

CORPORATE DiRECTORy

Directors

Robert Michael Kennedy (Chairman) Kevin James Lines (Managing Director) Kevin John Anson Wills (Non Executive Director) Ewan John Vickery (Non Executive Director) Adam Bannister (Alternate for E J Vickery)

company secretary

Richard Willson

registereD anD principal office

62 Beulah Road Norwood South Australia 5067

Telephone	+61 8 8132 7970
Facsimile	+61 8 8132 7999
solicitor
DMAW Lawyers
Level 3 80 King William Street
Adelaide South Australia 5000
Telephone	+61 8 8210 2222
Facsimile	+61 8 8210 2233
share registry
Computer Share Registry Services
Level 5 115 Grenfell Street
Adelaide South Australia 5000
Telephone	+61 8 8236 2300
Facsimile	+61 8 8236 2305

auDitor

Grant Thornton 67 Greenhill Road Wayville South Australia 5034

Banker

National Australia Bank Kent town South Australia 5067

WeBsite

www.eromangauranium.com

The website includes information about the Company, its strategies, projects, reports and ASX announcements.

HIGHLIGHTS

Exciting results from only the second hole drilled at the Welbourn Hill project. Over 350m of alteration and mineralisation including 18m at 0.1% Cu.
Recognition of the potential for Welbourn Hill to host unconformity-related uranium mineralisation.
First drilling program completed at the Abminga project confirming all the critical elements are present for sandstone-hosted uranium deposition. Anomalous uranium values returned from multiple holes.
Northern Territory portion of Abminga Project identified from airborne EM as priority target of 2008-09 drill testing.
Important new project acquired at Suplejack in the Tanami region of the Northern Territory. Excellent potential for uranium and gold.
Eromanga retains strong cash reserves enabling active exploration and project acquisition to continue throughout 2009.

2 CHAIRMAN’S REPORT

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Robert Kennedy
Chairman
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Dear Fellow Shareholders

it is my great pleasure to present to you the 2008 annual report of Eromanga Uranium Limited. i write this report at a time of significant turmoil throughout the global financial markets. The resultant uncertainties are presenting the Company with new challenges, and i believe new opportunities, in the year ahead. it is pleasing therefore that Eromanga is positioned, at this point in time, with a strong balance sheet enabling our Company to benefit from the opportunities that will undoubtedly arise.

The Company remains strongly committed to the uranium sector. During the year the underlying fundamentals of the nuclear Energy Sector have continued to strengthen on the back of growing global concerns over energy security and the impacts of carbon based energy systems on climate change. increasingly countries throughout both the developed and emerging economies have reinforced their commitment to nuclear energy as a critical component in meeting their rapidly growing energy demands. Eromanga believes that these fundamental drivers will remain largely unchanged over the medium term and will underpin uranium prices at levels that will support ongoing discovery and development of new uranium deposits.

Over the course of 2008 our Company has continued to actively explore our portfolio of exploration properties whilst strengthening our prospects for discovery success through the addition of exciting new exploration initiatives. The Company now has a dual exploration focus with simultaneous drill-based exploration programs targeting both iron oxide, copper, gold, uranium mineralisation (iOCGU) in the northern Gawler Craton and sandstonehosted uranium systems around the margins of the Eromanga Basin.

at the Welbourn hill iOCGU Project the Company achieved highly encouraging results with only its second drill-hole into this previously untested gravity/ magnetic anomaly. The intersection of over 350 metres of highly altered and brecciated basement gniesses with associated copper mineralisation highlights the prospectivity of this area of the Gawler Craton. The recognition by Company geologists that the project area also has the potential to host unconformity-related uranium mineralisation has been an exciting development for Eromanga.

in our search for sandstone-hosted uranium deposits the Company has built off the investment we made in 2007 in acquiring full airborne Em coverage of all our major projects. Whilst maximising the information contained within these massive data sets has at times been very challenging for our staff the Company is now at the forefront of this important exploration technique. Our primary exploration focus has been directed at the abminga Project, in the far north of South australia, where our initial drilling campaigns have been completed and have confirmed that all the critical elements for the formation of significant uranium deposits are present in our project area. The Company is very confident that this project area will rapidly evolve in 2008 with the potential for important discovery success.

Eromanga continually monitors the broader australian uranium exploration sector for opportunities to acquire interests in emerging exploration projects. The recent political changes in Western australia have resulted in a more favourable climate for uranium exploration in that state and the Company is actively reviewing a number of uranium exploration opportunities. We have also been successful, against strong competition, in securing our application for an exploration licence over the Suplejack Project in the Tanami region of the northern Territory. This exciting project offers the opportunity for the discovery of not only uranium but gold/uranium and gold only deposits.

The ongoing management and growth of an exploration company requires the diligence and professionalism of many people. i take this opportunity to express my thanks to all those who have contributed in such a committed fashion to our Company over the last twelve months. Similarly, my thanks go to the Executive and Directors of the Company for their continuing support. most importantly i would like to recognise our loyal shareholders who have supported the Company during a difficult year and who hopefully will benefit from our combined endeavours in the year ahead.

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Robert Kennedy Chairman October 2008

4 MANAGING DIRECTOR’S REPORT

During a year which has presented significant challenges to the uranium exploration sector in australia, Eromanga Uranium has continued to strengthen its exploration portfolio and maintained its focus on actively drill testing our priority targets. The Company identified the potential for the northern Gawler Craton to host iron oxide, copper, gold and uranium mineralisation (iOCGU) and was able to secure strategic tenure over two significant gravity anomalies in the region. This iOCGU initiative, centred on the marla region of northern South australia, has allowed the Company to pursue a dual exploration focus targeting both large iOCGU systems at depth within the basement rocks whilst continuing to test for shallower sandstonehosted uranium mineralisation around the margins of the Eromanga Basin.

at the Welbourn hill iOCGU Project the Company completed two deep diamond drill holes, EWhDD01 and 02, testing a large coincident gravity/magnetic anomaly. hole EWhDD02 was successful in intersecting over 350m of intensely altered, variably brecciated and mineralised basement gneisses. Whilst the copper grades returned from this broad intersection were sub-economic, with a best intersection of 18m at 0.1% Cu, the result confirmed the presence of significant volumes of iOCGU type mineralising fluids in the project area and has given strong impetus for further exploration. The second leg of the Company’s iOCGU initiative was focussed on the nicholson Project where a single 800m deep diamond drill hole, EnDDh01, was completed. The drill hole failed to intersect iOCGU mineralisation but only partially explains the very large gravity anomaly in the project area and the project is under review before further exploration is undertaken.

The primary focus of the Company’s sandstone-hosted, or roll-front style, uranium exploration has been on our expansive tenement holdings in the abminga and abminga East project areas. The results of airborne Em surveys completed over the entire project area indicated the development of extensive palaeo-drainage systems in the atlas/Baco area to the north of the township of marla. an initial rotary-mud drilling program was completed in this area and involved 23 drillholes for a total of 4,444m. This drilling program confirmed that the palaeo-drainages, as interpreted from the airborne Em, were developed in shallow Tertiary sediments that are largely oxidised and not considered prospective for the development of significant uranium mineralisation. however, the drilling also confirmed that the Company’s primary target in the deeper mesozoic age algebuckina Sandstone remains highly prospective with the drilling returning multiple anomalous gamma responses. Following this initial drill testing, exploration has been directed at better defining the deeper palaeo-drainages using an integrated approach that combines the airborne Em, magnetic and microgravity surveys. This approach has been very successful and will allow greater control of drilling during our subsequent drill campaigns.

at the Kingoonya and Billa Kalina Projects the company completed airborne Em surveys, utilising the rEPTEm system, over the entire tenement holdings. Detailed computer processing and analysis of the data from these surveys has been very encouraging and has generated multiple drill targets for testing when all access requirements are finalised.

at the marree Project the results of the first round of rotary-mud drilling has focussed the company’s exploration efforts on the more easterly sector of our tenement holdings where higher uranium contents in the local source rocks give greater chances of exploration success.

MANAGING DIRECTOR’S REPORT

Eromanga Uranium was successful in its application for new exploration tenure at the Suplejack Project in the Tanami region of the northern Territory. This area is highly prospective for unconformity-related uranium mineralisation as well as hosting excellent gold potential. negotiations to finalise an access agreement with the Traditional Owners are underway.

The Company remains well positioned to maintain very active exploration programs over the coming year. Whilst stock market conditions have been difficult over the last twelve months the underlying fundamentals for the global energy sector and the uranium industry in particular continue to be very healthy. This positive outlook for uranium underpins the company’s commitment to ongoing uranium exploration across our extensive project portfolio in australia.

at the abminga and abminga East Projects drill based exploration programs will continue on a campaign basis throughout 2008-09. it is anticipated that access agreements with the Traditional Owners will be finalised in the second quarter of the year allowing exploration to commence on the highly prospective portion of the project area located in the northern Territory.

at the Welbourn hill and nicholson Projects the Company will continue to advance its iOCGU initiative over the northern Gawler Craton. a detailed review of all exploration results received to-date is currently underway and will form the basis for decisions on the location of future drilling campaigns.

The second round of drilling is scheduled to commence at the marree Project early in the second quarter of 2008-09 and initial drill testing at the Kingoonya Project is anticipated to be underway early in the 2009 calendar year.

at the Suplejack Project, in the Tanami region of the northern Territory, the company is hopeful that all prerequisite agreements with the Traditional Owners can be in place by the third quarter of the year allowing onground exploration to commence immediately following the end of the wet season.

Eromanga Uranium Ltd maintains an active project review and project generation function with a strong focus on assessing acquisition and/or farm-in opportunities over more advanced uranium properties within australia. The Company retains a healthy balance sheet and is very well positioned to be an active participant in the growth of the uranium exploration and mining sector in the coming years.

The Company has had a very active year with many of our personnel working in remote and often challenging environments. i would take this opportunity to thanks all those who have performed so professionally and with great loyalty. Eromanga retains an excellent team who are very strongly committed to our goals and at all times are focussed on ensuring exploration success.

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Location of Eromanga project areas. ��

PROJECT REVIEWS

IRON OXIDE, COPPER, GOLD, URANIUM (IOCGU)

WELbOURN HILL

(Eromanga Uranium 100% in EL 4020)

The Welbourn hill Project is located approximately 45km east of the township of marla in far northern South australia (Figure 1) and forms part of the Company’s northern Gawler Craton initiative. The primary target in the project area is a coincident high order gravity and magnetic anomaly considered to be prospective for iron oxide-copper-gold-uranium mineralisation similar to that at the Olympic Dam, Prominent hill and Carrapateena deposits to the south-east.

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Granite Downs Lambina EL4001
- 27º
EL4019 Todmorden
Mintabie Marla
EL4050
Welbourn Hill
Wallatina
0 40 km
EL4020
Nicholson Mt Gordon
Welbourn Hill Todmorden
134º 135º
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Figure 1 Location of Welbourn Hill tenements.

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During the year the Company has successfully secured EL 4020 and completed the drilling of two deep diamond drill holes, EWhD01 and EWhD02, over the central portions of the major gravity anomaly at Welbourn hill (Figure 2). The first of these holes was completed at a depth of 831.17m, intersecting the targeted crystalline basement at a depth of 701.1m after passing through a sequence of fine to coarse grained hematitic sediments (Figure 3). The gneissic basement, whilst strongly altered and deformed, did not intersect any significant mineralisation. The second drill hole in the program, EWhD02, was sited approximately 2.1km to the northwest of EWhD01 and approximately 2km to the south of the interpreted position of the major bounding fault structure (Figure 2). This second hole was completed at a depth of 806.53m having intersected a zone of over 350 metres (from 450 to 806.53m) of strongly altered and locally intensely brecciated basement gneisses. This extensive basement intersection contains abundant hydrothermal magnetite with associated pyrite, chalcopyrite and minor bornite mineralisation disseminated throughout. The bottom of hole remained in altered and mineralised gneisses.

assay results from EWhD02 confirm the presence of anomalous copper mineralisation with a best intersection of 18m at 0.1% Cu over the interval from 640-658 metres*. These results, whilst sub-economic, are considered to be highly significant as they confirm for the first time that the northern limits of the Gawler Craton have been host to large volumes of the same type

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EL4020 EL4050
Nicholson-2
-27º20'
Open
Open
A EWHD02EWHD02EWHD02EWHD02
Target Body EWHD01EWHD01EWHD01EWHD01
B
WHD-2
Open
Magnetic body as modelled at 1350m depth
-27º25'
Comalco drilhole - 1981
Newcrest drillhole - 1992
0 2 km
Current Eromanga drillholes - 2008
@
Fault
134º 134º05'
@
@
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Figure 2 Welbourn Hill magnetics with gravity contours.

PROJECT REVIEWS

of fluids that have been responsible for the formation of other iOCGU systems on the Gawler Craton. The Company believes that these results, achieved with only the second drill hole in a new terrain, provide very strong support for our iOCGU initiative in the northern Gawler Craton.

The Company believes that the highly elevated magnetite content within the basement gneisses can adequately explain the observed magnetic anomaly at Welbourn hill, however the current understanding of the overall geology of the project area does not fully accommodate the significant gravity anomaly. as a consequence the large coincident gravity/magnetic anomaly at Welbourn hill remains open to the north, south and west (Figure 2). The results from EWhD01 and EWhD02 show a pronounced increase in alteration intensity, brecciation and sulphide mineralisation within the western portion of the overall anomaly indicating that significant potential remains to the west of EWhD02 (Figure 3). This potential is further enhanced by the much shallower depths to basement in EWhD02 (450m in EWhD02 vs 701m in EWhD01). Similarly, significant potential also exists to the north between EWhD02 and an interpreted major bounding fault, a distance of over 2km (Figure 2).

The drilling at Welbourn hill has also identified the potential for the project to host unconformity-related uranium mineralisation similar in style to that in the alligator rivers region of the northern Territory and the athabasca Basin in Canada. These deposits are

hosted within major structures in the Palaeoproterozoic basement rocks at, or close to, the unconformity with a thick sequence of overlying hematitic sediments. This style of uranium mineralisation contains many of the highest grade uranium deposits globally with mines planned or operating at depths in excess of 400m. all of the critical controls necessary for the development of this type of deposit have been identified in the Company’s drilling at Welbourn hill. This is an exciting new development for Eromanga Uranium and it is our intention to integrate exploration for unconformity-related uranium mineralisation into our ongoing iOCGU programs at Welbourn hill.

The Company is completing a review of exploration results received to-date at Welbourn hill and is considering a number of options for future exploration, including limited geophysical surveys, with the objective of optimising the location of future drilling at Welbourn hill. On completion of this review it is our intention that the second phase of exploration will commence in late 2008 or early 2009.

*(All sampling was undertaken over 1m intervals with half-core sent for analysis at the laboratories of ALS in Perth. Samples were dried, crushed, riffle split to 1kg and pulverised such that 85% passed a nominal 75 microns. After aqua-regia digest the copper assays were determined using ICPAES. The interval has been calculated using a 250ppm Cu lower cut-off. No significant gold or uranium assay values have been received from the hole to-date.)

Figure 3 Welbourn Hill schematic long-section.

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8 PROJECT REVIEWS

NICHOLSON PROjECt

(Eromanga Uranium 100% in EL 4019)

The nicholson Project is located approximately 30km to the north-east of Welbourn hill and 65km from the township of marla (Figure 4). The project is defined by a significant 10mgal gravity anomaly centred over a large elliptical magnetic feature that has been interpreted as a volcanic complex within older basement rocks. The Company is exploring for hematite hosted iOCGU mineralisation.

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NIDH 1NIDH 1NIDH 1NIDH 1
Coongra 1
Nicholson 1 Nicholson TargetNicholson TargetNicholson TargetNicholson Target
EOB 2
EL4019
EL4020
Nicholson 2
-27º20'
EWHD 2EWHD 2EWHD 2EWHD 2 EL4050
EWHD 1EWHD 1EWHD 1EWHD 1
WHD 2
Welbourn HillWelbourn HillWelbourn Hi lWelbourn Hi l Diamond Drillhole
Historic Drillhole
TargetTargetTargetTarget
Fault
0 5 km
Gravity Contour
134º 134º20'
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Figure 4 Gravity contours over a magnetic image.

During the year the Company secured title to EL 4019 and completed the drilling of the first hole, EnDDh01, to a total depth of 793.47m. The drillhole intersected a thin cover sequence of approximately 50m of mesozoic sediments before drilling through a very thick assemblage of dolomitic mudstones and minor inter-bedded sandstones, with the sandstone content increasing towards the base of the hole. The hole was terminated at 793m as the Company believes that any mineralisation intersected beyond this depth would be unlikely to be of economic significance. The thick sedimentary succession intersected in EnDDh01 is interpreted by the Company to be neoproterozoic rocks that overlie the older basement considered favourable for hosting iOCGU mineralisation. The gravity anomaly remains only partially explained but is thought to be due, at least in part, to the presence of relatively dense dolomitic mudstones overlying lighter basement assemblages.

in combination with the Welbourn hill review the Company is now analysing the exploration results from the nicholson Project. This process will ensure that the Company can best prioritise its future exploration for iOCGU systems in the region before committing to further significant expenditures.

tODMORDEN PROjECt

(Eromanga earning 80% in EL 4001 from InterMet Resources)

During the year the Company entered onto a Joint Venture with intermet resources over EL 4001 at Todmorden with the area considered to be prospective for iOCGU mineralisation. The project area is positioned over the northern margins of the Gawler Craton approximately 90km north-east of the township of marla in northern Sa.

as the first phase of our exploration at the Todmorden Project, Eromanga Uranium has completed a ground gravity survey over an area of coincident elevated magnetic and gravity response in the broad spaced regional data sets. This survey was completed at 500m station spacing on two east-west lines (2km separation) and two north-south lines (8km separation) (Figure 5). modelling of the data from this survey confirms a broad gravity feature (6 mGals) combined with a smaller 2 mGal anomaly.

The Company interprets these results to reflect the response from deep basement (plus 800m) with only very limited opportunity for the presence of a significant body of iOCGU style mineralisation.

The geology of the project area is extremely complex and retains significant exploration potential and the Company is currently undertaking a review of the known geology of the area to help direct future exploration.

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0 10 km Gravity survey lines
EL4001
-27º
134º40'
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Figure 5 Todmorden gravity contours over a magnetic image.

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PROJECT REVIEWS 9

SANDStONE-HOStED URANIUM

AbMINGA PROjECt

(InCOrpOratInG abmInGa East)

(Eromanga 100% in ELs 3982, 3964 and ELA 594/07; Eromanga earning 70% under the Eromanga Basin JV Agreement with Maximus Resources Ltd in ELs 3575, 3599, 3600, 3601, 3602, 25163 and 25166. Eromanga earning 100% of the uranium rights from Caldera Resources on EL 3186)

The abminga Project is the largest of Eromanga Uranium Limited’s major projects and covers an area exceeding 9,000 sq km. Eromanga has the right under the terms of the Eromanga Basin Joint Venture to earn a 70% interest from maximus resources in seven granted exploration licences (five in Sa and two in nT) covering a total 6,914 sq km. Eromanga also has the opportunity to secure 100% of the uranium rights in EL 3186 (74 sq km) from Caldera resources. The remainder of the tenement holding at abminga is held 100% by Eromanga (Figure 6). The entire area is considered to be highly prospective for sandstone-hosted (roll-front) style uranium mineralisation.

During the year the initial focus of exploration was directed at the interpretation of the data acquired

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Lilla Creek
Finke
Umbeara
EL25166
Kulgera
Northern Territory EL25163
-26º
South Australia
EL3602
Tieyon EL3982
Eringa
EL3601
Mount Irwin
Agn es Creek EL3186
EL3964
EL4094
EL3599
Lambina
Granite Downs
-27 º
EL3600
Todmorden
Mintabie
Marla
Welbourn Hill
Wallatinna
EL3575
20 km
Exploration Licence
134º
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from the expansive airborne Em survey completed by Eromanga in 2007. This survey involved the completion of over 9,000 line/km of data collection utilising the rEPTEm helicopter mounted airborne Em system. The data processing, analysis and interpretation of the Em

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Figure 6 Location of tenure in the Abminga area held 100% by Eromanga Uranium.

10 PROJECT REVIEWS

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EL3602
Mount Anthony EL3982
Mount Treloar
Miller
Eromanga Uranium 100%
Gassendi
Maximus Resources JV
Caldera Resources JV
EL3186
Warrataddy Hill Delambre
-26º30'
Rotary Mud Drillhole
Palaeochannel
EL3601
Black Hill Dam 0 10 km
EL3964
Enungarenna Hill
EL4094 Lambina
Kepler
Baco
Julius
Lambert
Euler
Franklin
Capella
Zeno
Atlas
Halley
Isidorus
134º 134º30'
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Figure 7 Atlas and Baco palaeochannels showing location of rotary mud drillholes, Abminga East.

data identified 14 new palaeo-drainages in the immediate environs of the atlas/Baco systems (Figure 7). This palaeo-drainage network totalled in excess of 250km of interpreted drainage available for testing.

The first phase of exploration drilling at abminga East was completed during the year with rotary-mud drilling of 23 holes for a total of 4,444 metres. The program was designed to provide two drill traverses across the interpreted positions of the atlas and Baco palaeodrainages, one essentially parallel to the basin margin and the other in a north-east/south-west orientation (Figure 7).

results from this initial drilling program indicate that the interpreted palaeo-drainages are not within the targeted mesozoic sandstones but are developed within the younger, overlying Tertiary sediments. These Tertiary cover sediments, whilst more extensive than previously

recognised, are rarely greater than 50 metres in thickness and are completely oxidised. as such they do not represent a viable target for the development of roll-front style uranium mineralisation.

however, the drilling program has identified that the underlying mesozoic algebuckina Sandstone remains highly prospective with the drilling returning a number of intersections containing zones, to 10 metres, with anomalous gamma response in reduced pyritic/ carbonaceous sandstones. Estimations of the equivalent uranium values from the zones of elevated gamma response returned a peak value 60ppm eU3O8 and subsequent analysis from sampling of the rotary-mud drill cuttings returned a best value of 30ppm U. These results, whilst only moderately anomalous, are considered by the Company to be encouraging as they confirm that

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PROJECT REVIEWS 11

the conditions within the algebuckina Sandstone are conducive to the deposition of uranium in a roll-front setting.

The Company does not believe that the drilling to-date, within the algebuckina Sandstone, has tested the most favourable geologic settings and has embarked on a program of re-interpretation of the airborne Em data, in conjunction with the magnetics, to produce a composite image that defines mesozoic palaeo-drainages incised into the basement rocks. The work completed to-date has been very promising and will provide the control for the second phase of drill testing in the abminga region. These new interpretations will be further validated by the completion of selected ground based microgravity surveys designed to map in detail the basement morphology. Whilst the interpretation of the airborne Em data sets has presented the Company with significant challenges we strongly believe that the exploration potential within the abminga Project area remains excellent.

The Company has also identified four major new target areas in the portion of the abminga tenement holding located within the northern Territory (Figure 8). These interpreted drainage positions are considered particularly attractive as they source uranium from both the uranium enriched Kulgera Granites and basal sediments of the arunta terrain immediately to the west of Eromanga’s tenement holdings. This area will be a priority target for the Company early in the 2009 calendar year after finalisation of agreements with the Traditional Owners.

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-25º30'
EL25166
- 26º Northern Territory EL25163
South Australia
0 10 km
REPTEM Palaeochannel Target
�
� �
134º
134º30'
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Figure 8 Location of four new target areas in the Northern Territory.

bILLA KALINA

(Eromanga Uranium earning 50% under the terms of the Billa Kalina JV from Maximus Resources Ltd in ELs 3526, 3525, 3170, 3337 and 3338)

The Billa Kalina Project is located 70km north-north-west of the Olympic Dam copper-gold-uranium (iOCGU) mine, and 45km east of the more recent discovery and mine development at Prominent hill, South australia (Figure 9). Eromanga is exploring for iOCGU deposits in the deeper

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Anna Creek
20 km William Creek
EL3526
EL3525
E Prominent Hill
EL3170
Mount Eba EL3338
Bon Bon Olympic Dam E
Roxby Downs
Exploration Licence E Major mineral deposit
Figure 9 Location of Billa Kalina Project tenements.
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12 PROJECT REVIEWS

basements rocks and for sandstone-hosted uranium mineralisation in the shallower sedimentary cover sequences.

During the year exploration at the Billa Kalina Project has been directed at the shallower sandstone-hosted uranium potential via interpretation of the airborne Em data collected in 2007-08. This work has highlighted a discrete sub-basin within the north-eastern portion of EL 3526. The basin, named the Sunshine Dam Project, is defined by a coincident Em anomaly and gravity low that is interpreted to represent a thickening of the mesozoic cover sediments within the basin (Figure 10). The Company believed that this sub-basin was a favourable site for the development of sandstone-hosted, or rollfront, style uranium mineralisation around the basin margins. a short drilling program of three rotary-mud drill holes has been recently completed over the long axis of the Sunshine Dam sub-basin and has shown that the Em anomaly is due to the presence of a slightly thicker, and more reduced, layer of Bulldog Shale that caps the small sub-basin. The anomalous gravity low appears to be due to the localised presence of the more sand-rich Permian Toondina Formation that underlies the mesozoic algebuckina Sandstone. The Toondina Formation is well developed to the west of our Billa Kalina tenement holdings but within the immediate environs of the project is restricted to the small Sunshine Dam sub-basin.

no further exploration of this target is planned at this point in time.

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Coincident gravity low/REPTEM highCoincident gravity low/REPTEM highCoincident gravity low/REPTEM highCoincident gravity low/REPTEM highCoincident gravity low/REPTEM high lll l
-29º
Map area
Billa Kalina
Exploration
Licences
-29º10'
0 5 km
EL3526
136º10'
136º
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MARREE PROjECt

(Eromanga earning 70% under the Eromanga Basin JV Agreement with Maximus Resources Limited in ELs 3574, 3577, 3578 and 3579. Eromanga 100% of ELs 3962 and 3963)

The marree Project is located 40km east of the township of marree in northern South australia (Figure 11) and consists of six granted exploration licences covering 5,779km[2] . Eromanga’s primary exploration target at the marree Project is sandstone-hosted uranium deposits similar to those at the Beverley and Four mile discoveries.

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Lake
Clayton
Blanche
EL3963
EL3962
Murnpeowie
Marree
20 km
EL3574 EL3579
EL3578
- 30 ° EL3577
Four Mile
FFFF
Mt Gee E FFFF
Lyndhurst Beverley
Lake Leigh Creek Lake
Torrens Frome
Exploration Licence E Hard rock uranium deposit
FFFF Sedimentary uranium deposit
138 ° 139 °
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Figure 11 Location of Marree Project tenements.

Whilst the major focus of exploration by the Company in 2008 has been directed at the iOCGU and sandstonehosted uranium targets in the marla region work programs at marree have been restricted to field testing of a number of small radiometric anomalies within the western ELs 3962 and 3963 held 100% by Eromanga Uranium. Sampling of these anomalies confirms that they are of only limited extent and are localised at the basal contact of thin Tertiary cover sediments in the area. The Company considers that these two tenements offer restricted exploration potential and has surrendered this portion of the marree Project landholding.

Future exploration at marree will be directed at the eastern end of our tenement holding where the Company believes we have the greatest potential for the discovery of sandstone-hosted or roll-front style uranium mineralisation. a micro-gravity traverse and follow-up rotary-mud drilling program, sited over drainages sourced from the northern end of the uranium enriched Paralana inlier, is scheduled for late in the second quarter of the 2008-09 financial year.

Figure 10 Billa Kalina gravity contours over a magnetic image.

PROJECT REVIEWS 13

KINGOONyA PROjECt

(Eromanga Uranium earning 70% under the terms of the Eromanga Basin JV from Maximus Resources in ELs 3573, 3576, 3590, 3591 and 3613)

The Kingoonya Project is located approximately midway between the townships of Glendambo and Coober Pedy, South australia and consists of five granted exploration licences covering 4,060km[2] . The company’s main exploration targets at Kingoonya are sandstone-hosted uranium and unconformity-related uranium deposits (Figure 12).

no ground-based exploration was undertaken at the Kingoonya Project during the year. Work has focussed on interpretation of the airborne Em survey completed last year and the completion of all the necessary access permits from the Defence Department over the Woomera Prohibited area (WPa) and from the Traditional Owners. it is intended that targets identified at the Kingoonya Project will be tested as part of the Company’s 2008-09 exploration programs.

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

Ingomar Prominent Hill
EL3613 E
The Twins
-30º EL3591
E L3590
Mount Eba
EL3573
EL35 7 6 Bon Bon
Whymlet
Tarcoola
Kingoo n ya
Glendambo
-31º 20 km
Exploration Licence E Major mineral deposit
135º
----- End of picture text -----

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Figure 12 Location of Kingoonya Project tenements.

14 PROJECT REVIEWS

NEW PROjECtS

SUPLEjACK PROjECt

(Eromanga Uranium 100% in EL 26625)

The Suplejack Project is located in the Tanami region of the northern Territory approximately 600km northwest of alice Springs and covers an area of 168 square kilometres. The Company considers this tenement to be prospective for both high-grade, unconformity related uranium mineralisation and for gold deposits of the Coronation hill and Groundrush styles.

The Company is now in receipt of the formal right to negotiate with the Traditional Owners and is expediting this process with the view to having completed all the necessary permitting and clearance surveys early in calendar 2009. Exploration in the wider region, by previous gold explorers, has confirmed the presence of Gardiner Sandstone and antrim Plateau Basalts which unconformably overlie highly reactive Palaeo-proterozoic basement sediments. The tenement area is also traversed by the Suplejack Shear, a major north-south crustal scale structure, known to be a critical element in the formation of gold deposits in the region (Figure 13). This geological environment is considered to be ideal for the formation of unconformity-related uranium mineralisation (similar to the ranger and Jabiluka deposits), gold-uranium mineralisation (similar to Coronation hill) and gold only deposits similar to the Groundrush deposit to the immediate north of the project area.

Exploration of this exciting new area will commence immediately all of the pre-requisite permits are in place.

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EL26625
-19º55'
-20º
0 2 km
FAULT
FAULT
130º05'
SUPLEJACK SHEAR ZONE
----- End of picture text -----

Figure 13 Location of Suplejack Project with grey scale magnetic image.

The Company is also actively reviewing a number of uranium and gold opportunities throughout australia. The current global financial environment is placing pressure on the ability of Junior Explorers to raise fresh capital and as a result the number and quality of new acquisition or joint venture opportunities is rapidly increasing. Eromanga Uranium is well placed, given its relatively strong cash position, to be an active player in acquiring exploration projects that offer the potential to significantly increase our chances of exploration success.

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Mr Kevin Lines manaGinG DirECTOr October 2008

TENEMENT SCHEDULE

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Tenement / Tenement Name Date Granted / Expiry Date Area Registered Holder / Applicant Related Agreement
Appl’n Number Applied For sq km
South Australia
Billa Kalina Project
EL 3526 Francis 23/02/06 22/02/08 Extn pending 734 Flinders Diamonds Limited Maximus BK Agreement
EL 3525 Margaret 23/02/06 22/02/08 Extn pending 771 Flinders Diamonds Limited Maximus BK Agreement
EL 3170 Billa Kalina 25/02/04 24/02/08 Extn pending 1,435 Flinders Diamonds Limited Maximus BK Agreement
EL 3337 Welcome Creek 19/05/05 18/05/08 Extn pending 373 Flinders Diamonds Limited Maximus BK Agreement
EL 3338 Millers Creek 19/05/05 18/05/08 Extn pending 771 Flinders Diamonds Limited Maximus BK Agreement
Marree Project
EL 3579 Calcutta 21/06/06 20/06/08 984 Maximus Resources Limited Maximus EB Agreement
EL 3578 Dalarinna Hill 21/06/06 20/06/08 1000 Maximus Resources Limited Maximus EB Agreement
EL 3577 Wilpoorina 21/06/06 20/06/08 962 Maximus Resources Limited Maximus EB Agreement
EL 3574 Mundowdna 21/06/06 20/06/08 963 Maximus Resources Limited Maximus EB Agreement
EL 3962 Callanna 22/10/07 21/10/08 875 Eromanga Uranium Limited
EL 3963 Marree 22/10/07 21/10/08 995 Eromanga Uranium Limited
Abminga Project
20/06/2008 Extn
EL 3575 Marla 21/06/06 pending 988 Maximus Resources Limited Maximus EB Agreement
EL 3599 Alberga River 17/07/06 16/07/08 903 Maximus Resources Limited Maximus EB Agreement
EL 3600 Mt Weir 17/07/06 16/07/08 959 Maximus Resources Limited Maximus EB Agreement
EL 3601 Black Hill Dam 17/07/06 16/07/08 963 Maximus Resources Limited Maximus EB Agreement
EL 3602 Mt Anthony 17/07/06 16/07/08 966 Maximus Resources Limited Maximus EB Agreement
EL3964 Enungarenna Hill 22/10/07 21/10/08 877 Eromanga Uranium Limited
EL 3982 Mount Treloar 19/11/07 18/11/08 990 Eromanga Uranium Limited
EL 3186 Warrataddy Hill 17/03/04 16/03/09 74 Caldera Resources Pty Ltd Caldera Agreement
EL 4019 Nicholson Hill 15/01/08 14/01/09 725 Eromanga Uranium Limited
EL 4020 Welbourn Hill 15/01/08 14/01/09 289 Eromanga Uranium Limited
EL 4050 Mount Gordon 25/02/08 24/02/09 292 Eromanga Uranium Limited
EL 4094 Lambina 12/03/08 11/03/09 505 Eromanga Uranium Limited
ELA166/08 Hamilton 14/04/08 650 Eromanga Uranium Limited
Kingoonya project
EL 3576 Whymlet 21/06/06 20/06/09 973 Maximus Resources Limited Maximus EB Agreement
EL 3573 Haggard Hill 21/06/06 20/06/09 859 Maximus Resources Limited Maximus EB Agreement
EL 3590 Bon Bon 22/06/06 21/06/09 667 Maximus Resources Limited Maximus EB Agreement
EL 3591 McDouall Peak 22/06/06 21/06/09 980 Maximus Resources Limited Maximus EB Agreement
EL 3613 Phar Lap 15/08/06 14/08/08 581 Maximus Resources Limited Maximus EB Agreement
Todmorden project
EL 4001 Todmorden 16/12/08 15/12/09 983 International Metals Pty Ltd
Northern Territory
Illogwa Creek
EL 25161 Illogwa Creek 1/24/2006 In 5 year moratorium 1117 Maximus Resources Limited Maximus EB Agreement
EL 25162 Numery 11/16/2006 11/15/2012 216 Maximus Resources Limited Maximus EB Agreement
Abminga
EL 25163 Mt Peterswald 11/16/2006 11/15/2012 1130 Maximus Resources Limited Maximus EB Agreement
EL 25166 Jenkins Bluff 11/16/2006 11/15/2012 1005 Maximus Resources Limited Maximus EB Agreement
Suplejack Project
EL 26625 Suplejack 2/4/2008 168 Eromanga Uranium Limited
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16 TENEMENT LOCATIONS

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

E Groundrush Tennant Creek
-20 ° Tanami E Suplejack
Ca l lie E E The Granites
N O R T H E R N T E R R I T O R Y
Q U E E N S L A N D
Alice Springs
Illogwa Creek
-2 5 °
Kulgera
A b minga
S O U T H A U S T R A L I A
Billa
Coober Pedy
Kalina
Prominent Hill Marree
Marree
E
Challen ger E Four Mile
-30 °
Ki ng oony a E Olympic Dam Mt Gee E FFFFFFFF Beverley
Roxby Downs
Glendambo
E Carra p ateena
E Punt Hill
Ce duna
P ort Augusta
0 100 km
Exploration Licence
Exploration Licence Application
E Major mineral deposit A d e laid e
-35 ° FFFF Sedimentary uranium deposit
0 °
4
135 ° 1
130 °
----- End of picture text -----

EROMANGA URANIUM LIMITED ACN 119 031 864

Financial RepoRt

For the year ended 30 June 2008

INDEX

Corporate Governance Statement	18
Directors Report	22
Auditors Independence Declaration	27
Income Statement	28
Balance Sheet	29
Statement of Changes in Equity	30
Cash Flow Statement	31
Notes to the Financial Statements	32
Directors Declaration	44
Independent Audit Report	45
ASX Additional Information	48

EROMANGA URANIUM LIMITED ACN 119 031 864

coRpoRate GoVeRnance StateMent

The Board of Directors of Eromanga Uranium Limited has established corporate governance policies and procedures, where practicable, consistent with the revised Corporate Governance Principles and Recommendations issued by the ASX Corporate Governance Council (“ASX Recommendations”).

The following statement sets out a summary of the Company’s corporate governance practices that were in place during the financial year and how those practices relate to the revised Corporate Governance Principles and Recommendations issued by the Australian Stock Exchange Corporate Governance Council (“ASX Recommendations”). The Company has elected to undergo an early transition to the revised Principles and Recommendations and as such has reported against these for the financial year ending 30 June 2008.

These recommendations are not intended to be prescriptions to be followed by all ASX listed companies, but rather guidelines designed to produce an effective, quality and integrity outcome. The Corporate Governance Council has recognised that a “one size fits all” approach to Corporate Governance is not required. Instead, it states aspirations of best practice for optimising corporate performance and accountability in the interests of shareholders and the broader economy. A company may consider that a recommendation is inappropriate to its particular circumstances and has flexibility not to adopt it and explain why.

The Board has included in its corporate governance policies those matters contained in the ASX Recommendations where applicable. However, the Board also recognises that full adoption of the above ASX Recommendations may not be practical nor provide the optimal result given the particular circumstances and structure of the Company. The Board is, nevertheless, committed to ensuring that appropriate Corporate Governance practices are in place for the proper direction and management of the Company. This statement outlines the main Corporate Governance practices of the Company.

PrinciPle 1 – lay solid foundations for management and oversight

Recommendation 1.1 – Recommendation followed

The Board is governed by the Corporations Act 2001, ASX Listing Rules and a formal constitution adopted by the Company in 2006.

The role of the Board is to provide leadership and direction to management and to agree with management the aims, strategies and policies of the Company for the protection and enhancement of long-term shareholder value.

The Board takes responsibility for the overall Corporate Governance of the Company including its strategic direction, management goal setting and monitoring, internal control, risk management and financial reporting.

The Board has an established framework for the management of the entity including a system of internal control, a business risk management process and appropriate ethical standards. In fulfilling its responsibilities, the Board is supported by an Audit Committee to deal with internal control, ethical standards and financial reporting.

implementation of risk management, internal control and regulatory compliance policies and procedures, recommending strategic direction and planning for the operations of the business and the provision of relevant information to the Board.

The Board has not adopted a formal statement of matters reserved to it or a formal board charter that details its functions and responsibilities nor a formal statement of the areas of authority delegated to senior executives.

Recommendation 1.2 – Recommendation followed

The Board takes responsibility for monitoring the composition of the Board and reviewing the performance and compensation of the Company’s Executive Directors and senior management with the overall objective of motivating and appropriately rewarding performance.

The Board considers the Company’s present circumstances and goals ensure maximum shareholder benefits from the attraction and retention of a high quality Board and senior management team. The Board on a regular basis reviews the performance of and remuneration for Executive Director’s and senior management including any equity participation by such Executive Directors and senior management. The Board evaluates the performance of the Managing Director and Company Secretary on a regular basis and encourages continuing professional development.

Recommendation 1.3 – Recommendation followed

During the period the Board undertook a performance evaluation of the Managing Director, Company Secretary and senior management. The evaluation was in accordance with the Company’s process for evaluation of senior executives.

PrinciPle 2 – structure the board to add value

Recommendation 2.1 – Recommendation followed

The composition of the Board consists of four directors of whom three, including the Chairman, are Independent Directors.

The Audit Committee currently consists of two Independent directors.

Recommendation 2.2 – Recommendation followed

The Chairman, Mr Kennedy is an Independent Director

Recommendation 2.3 – Recommendation followed

Mr Kennedy’s role as Chairman of the Board is separate from that of the Managing Director, Mr Lines who is responsible for the day to day management of the Company and is in compliance with the ASX Recommendation that these roles not be exercised by the same individual.

Recommendation 2.4 – Recommendation not followed

The Board believes that given the size of the Company and the stage of the entity’s life as a publicly listed junior exploration company that the cost of establishing a Nomination Committee in line with ASX Recommendation 2.4 and establishing a formal charter as recommended by ASX Recommendation 2.4 cannot be justified by the perceived benefits of so doing.

The Board appoints a Managing Director responsible for the day to day management of the Company including management of financial, physical and human resources, development and

EROMANGA URANIUM LIMITED ACN 119 031 864

coRpoRate GoVeRnance StateMent

Recommendation 2.5 – Recommendation not followed

The Board recognises that as a result of the Company’s size and the stage of the entity’s life as a publicly listed junior exploration company, the assessment of the Board’s overall performance and its own succession plan is conducted on an informal basis. Whilst this is at variance with the ASX Recommendation 2.5, the Directors consider that at the date of this report an appropriate and adequate process for the evaluation of Directors is in place.

Recommendation 2.6 – Recommendation followed

The names of the directors of the Company and terms in office at the date of this Statement together with their skills, experience, expertise and financial interests in the Company are set out in the Directors’ Report section of this report.

Messrs Kennedy, Vickery and Wills are considered to be independent.

The Company has no relationships with any of the independent directors which the Company believes would compromise the independence of these directors.

All directors are entitled to take such legal advice as they require at any time and from time to time on any matter concerning or in relation to their rights, duties and obligations as directors in relation to the affairs of the Company at the expense of the Company upon seeking permission, and being granted it, by the Chairman.

The Company’s constitution specifies the number of directors must be at least three and at most ten. The Board may at any time appoint a director to fill a casual vacancy. Directors appointed by the Board are subject to election by shareholders at the following annual general meeting and thereafter directors (other than the Managing Director) are subject to re-election at least every three years. The tenure for executive directors is linked to their holding of executive office.

As the board does not have a Nomination Committee, the functions of this Committee in its absence are dealt with by the Board as a whole.

An assessment of the Board’s overall performance and its own succession plan is conducted on an informal basis and was done so during the year by the Chairman.

PrinciPle 3 – comPanies should actively Promote ethical and resPonsible decision making

Recommendation 3.1 – Recommendation not followed

While the Company does not have a formal code of conduct, as the Board believes that given the size of the Company and the stage of the entity’s life as a publicly listed junior exploration company that the cost of establishing and managing a formal code of conduct cannot be justified, the Company requires all its directors and employees to abide by the standards of behaviour, and business ethics in accordance with the law. In discharging their duties, Directors of the Company are required to:

act in good faith and in the best interests of the Company;
exercise care and diligence that a reasonable person in that role would exercise;
exercise their powers in good faith for a proper purpose and in the best interests of the Company;
not improperly use their position or information obtained through their position to gain a personal advantage or for the advantage of another person to the detriment of the Company;
disclose material personal interests and avoid actual or potential conflicts of interests;
keep themselves informed of relevant Company matters;
keep confidential the business of all directors meetings; and
observe and support the Board’s Corporate Governance practices and procedures.

Directors are also required to provide the Company with details of all securities registered in the director’s name or an entity in which the director has a relevant interest within the meaning of section 9 of the Corporations Act 2001 and details of all contracts, other than contracts to which the Company is a party to which the director is a party or under which the director is entitled to a benefit, and that confer a right to call for or deliver shares in the Company and the nature of the director’s interest under the contract.

Directors are required to disclose to the Board any material contract in which they may have an interest. In accordance with Section 195 of the Corporations Act 2001, a director having a material personal interest in any matter to be dealt with by the Board, will not be present (unless requested by the Board to be present) when that matter is considered by the Board and will not vote on that matter.

Recommendation 3.2 – Recommendation followed

Directors, officers and employees are not permitted to trade in securities of the Company at any time whilst in possession of price sensitive information not readily available to the market. Section 1043A of the Corporations Act 2001 also prohibits the acquisition and disposal of securities where a person possesses information that is not generally available and which may reasonably be expected to have a material effect on the price of the securities if the information was generally available. This securities trading policy has been established by the Board and all employees and Directors are obliged to comply.

All directors have signed agreements with the Company which require them to provide the Company with details of all securities registered in the director’s name or an entity in which the director has a relevant interest within the meaning of section 9 of the Corporations Act 2001 and details of all contracts, other than contracts to which the Company is a party to which the director is a party or under which the director is entitled to a benefit, and that confer a right to call for or deliver shares in the Company and the nature of the director’s interest under the contract.

Recommendation 3.3 – Recommendation followed

The Company’s Trading Policy can be found at www. eromangauranium.com/governance

EROMANGA URANIUM LIMITED ACN 119 031 864

20 coRpoRate GoVeRnance StateMent

PrinciPle 4 – safeguard integrity in financial rePorting

Recommendation 4.1 – Recommendation followed

The Company was not a company required by ASX Listing Rule 12.7 to have an Audit Committee during the year although it is an ASX Recommendation. Notwithstanding the Listing Rule requirement, an Audit Committee has been established to oversee corporate governance over internal controls, ethical standards, financial reporting, and external accounting and compliance procedures.

The main responsibilities of the Audit Committee include:

reviewing, assessing and making recommendations to the Board on the annual and half year financial reports and all other financial information published or released to the market by the Company;
overseeing establishment, maintenance and reviewing the effectiveness of the Company’s internal controls and ensuring efficacy and efficiency of operations, reliability of financial reporting and compliance with applicable Accounting Standards and ASX Listing Rules;
liaising with and reviewing reports of the external auditor; and
reviewing performance and independence of the external auditor and where necessary making recommendations for appointment and removal of the Company’s auditor.

Recommendation 4.2 – Recommendation not followed

The Audit Committee consists of two non-executive, independent Board directors, Messrs Vickery and Kennedy, and is chaired by Mr Vickery.

The Board believes that given the size of the Company and the stage of the entity’s life as a publicly listed junior exploration company that the cost of establishing an audit committee with at least three members in line with ASX Recommendation 4.2 cannot be justified by the perceived benefits of so doing. The existing composition of the Audit Committee is such that review and authorisation of the integrity of the Company’s financial reporting and the independence of the external auditor is via the exercise of independent and informed judgement.

Recommendation 4.3 – Recommendation not followed

The Board believes that given the size of the Company and the stage of the entity’s life as a publicly listed junior exploration company that the cost of establishing a formal audit committee charter in line with ASX Recommendation 4.3 cannot be justified by the perceived benefits of so doing.

Recommendation 4.4 – Recommendation followed

Mr Kennedy is a qualified Chartered Accountant. Details of the Audit Committee member’s qualifications and attendance at meetings are set out in the Directors’ Report section of this report.

The Committee meets at least twice per annum and reports to the Board. The Managing Director, Company Secretary and external auditor may by invitation attend meetings at the discretion of the Committee.

PrinciPle 5 – make timely and balanced disclosure Recommendation 5.1 and 5.2 – Recommendations not followed

The Company operates under the continuous disclosure requirements of the ASX Listing Rules and ensures that all information which may be expected to affect the value of the Company’s securities or influence investment decisions is released to the market in order that all investors have equal and timely access to material information concerning the Company. The information is made publicly available on the Company’s website following release to the ASX.

Due to the size of the Company and the stage of life of the entity as a publicly listed junior exploration company, the Board does not believe a formal policy for continuous disclosure is required. However, the above policy describing how the Company will ensure its compliance with continuous disclosure requirements is posted on the Company’s web-site, www.eromangauranium.com/governance.

PrinciPle 6 – resPect the rights of shareholders

Recommendation 6.1 and 6.2 – Recommendations not followed

The Board aims to ensure that shareholders are informed of all major developments affecting the Company’s state of affairs. In accordance with the ASX Recommendations, information is communicated to shareholders as follows:

the annual financial report which includes relevant information about the operations of the Company during the year, changes in the state of affairs of the entity and details of future developments, in addition to the other disclosures required by the Corporations Act 2001;
the half yearly financial report lodged with the Australian Stock Exchange and Australian Securities and Investments Commission and sent to all shareholders who request it;
notifications relating to any proposed major changes in the Company which may impact on share ownership rights that are submitted to a vote of shareholders;
notices of all meetings of shareholders;
publicly released documents including full text of notices ofmeetings and explanatory material made available on the Company’s web-site; and
disclosure of the Company’s Corporate Governance practices and communications strategy on the entity’s web-site.

The Board encourages full participation of shareholders at the Annual General Meeting to ensure a high level of accountability and identification with the Company’s strategy and goals. Important issues are presented to the shareholders as single resolutions. The external auditor of the Company is also invited to the Annual General Meeting of shareholders and is available to answer any questions concerning the conduct, preparation and content of the auditor’s report. Pursuant to section 249K of the Corporations Act 2001 the external auditor is provided with a copy of the notice of meeting and related communications received by shareholders.

Due to the size of the Company and the stage of life of the entity as a publicly listed junior exploration company, the Board does not believe a formal policy for shareholder communication

EROMANGA URANIUM LIMITED ACN 119 031 864

coRpoRate GoVeRnance StateMent

is required. However, this policy describing how the Company will communicate with its shareholders is posted on the Company’s web-site, www.eromangauranium.com/governance.

PrinciPle 7 – recognise and manage risk

Recommendation 7.1, 7.2 and 7.4 – Recommendations not followed

The Board recognises that there are inherent risks associated with the Company’s operations including mineral exploration and mining, environmental, title and native title, legal and other operational risks. The Board endeavours to mitigate such risks by continually reviewing the activities of the Company in order to identify key business and operational risks and ensuring that they are appropriately assessed and managed. No formal report in relation to the Company’s management of its material business risk is presented to the Board.

Due to the size of the Company and the stage of life of the entity as a publicly listed junior exploration company, and the inherent risks associated with the industry it operates in, the Board does not believe formal policies for oversight and management of risk is required nor a mechanism for formal review be established. The policy describing how the Company manages risk by procedures established at Board and executive level can be found posted on the Company’s web-site, www.eromangauranium.com/governance.

Recommendation 7.3 – Recommendation followed

In accordance with ASX Recommendation 7.3 the Managing Director and Chief Financial Officer have provided assurances that the written declarations under s295A of the Corporations Act are founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks. Both the Managing Director and Chief Financial Officer provided said assurances at the time the s295A declarations were provided to the Board.

PrinciPle 8 – remunerate fairly and resPonsibly Recommendation 8.1 – Recommendation not followed

The Board believes that given the size of the Company and the stage of the entity’s life as a publicly listed junior exploration company that the cost of establishing a formal remuneration committee in line with ASX Recommendation 8.1 cannot be justified by the perceived benefits of so doing.

The Board takes responsibility for monitoring the composition of the Board and reviewing the compensation of the Company’s Executive Directors and senior management with the overall objective of motivating and appropriately rewarding performance.

Recommendation 8.2 and 8.3 – Recommendations followed

In accordance with ASX Recommendation 8.2 the Company’s remuneration practices are set out as follows.

The Company’s Constitution specifies that the total amount of remuneration of non-executive directors shall be fixed from time to time by a general meeting. The current maximum aggregate remuneration of non-executive directors has been set at $300,000 per annum. Directors may apportion any amount up to this maximum amount amongst the nonexecutive directors as they determine. Directors are also

entitled to be paid reasonable travelling, accommodation and other expenses incurred in performing their duties as directors.

Non-executive director remuneration is by way of fees and statutory superannuation contributions. Non-executive directors do not participate in schemes designed for remuneration of executives nor do they receive options or bonus payments and are not provided with retirement benefits other than salary sacrifice and statutory superannuation.

The remuneration of the Managing Director is determined by the Board as part of the terms and conditions of his employment which are subject to review from time to time. The remuneration of employees is determined by the Managing Director subject to the approval of the Board.

The Company’s remuneration structure is based on a number of factors including the particular experience and performance of the individual in meeting key objectives of the Company. The Board is responsible for assessing relevant employment market conditions and achieving the overall, long term objective of maximising shareholder benefits, through the retention of high quality personnel.

The Company does not presently emphasise payment for results through the provision of cash bonus schemes or other incentive payments based on key performance indicators of the Company given the nature of the Company’s business as a recently listed junior mineral exploration entity and the current status of its activities. However the Board may approve the payment of cash bonuses from time to time in order to reward individual executive performance in achieving key objectives as considered appropriate by the Board.

The Company also has an Employee Share Option Plan approved by shareholders that enables the Board to offer eligible employees options to ordinary fully paid shares in the Company. Under the terms of the Plan, options to ordinary fully paid shares may be offered to the Company’s eligible employees at no cost in accordance with the terms and conditions of the Plan. The objective of the Plan is to align the interests of employees and shareholders by providing employees of the Company with the opportunity to participate in the equity of the Company as an incentive to achieve greater success and profitability for the Company and to maximise the long term performance of the Company. The non-executive directors are not eligible to participate in the Plan.

The employment conditions of the Managing Director are formalised in a contract of employment. The Managing Director’s contract may be terminated at any time by mutual agreement or without notice in serious instances of misconduct.

Further details of director’s remuneration, superannuation and retirement payments are set out in the Remuneration Report section of the Directors’ Report.

These Corporate Governance Policies can be found at www. eromangauranium.com/governance

EROMANGA URANIUM LIMITED ACN 119 031 864

DiRectoRS RepoRt

Your directors present their report on the company and its controlled entities for the financial year ended 30 June 2008.

DIREcTORs

The names of directors in office at any time during or since the end of the year are: Robert Michael Kennedy Kevin James Lines Kevin John Anson Wills Ewan John Vickery Adam Bannister (alternate for E J Vickery)

The directors have been in office since the start of the financial year to the date of this report unless otherwise stated.

cOMpANy sEcRETARy

The following person held the position of company secretary at the end of the financial year:

Richard Walter Cumming Willson B.Ac., CPA, GAICD

Bachelor of Accounting, CPA, Graduate Member of the Australian Institute of Company Directors. Mr Willson has had more than 14 years experience. He has worked in public practice and in various financial management and company secretarial roles within the Provimi Australia group, BHP Billiton and the Jumbuck Pastoral group. He has been the Company Secretary since 29 March 2006 and to the date of this report.

pRINcIpAL AcTIvITIEs

The principal activity of the Company during the financial year was uranium exploration.

OpERATING REsULTs

The consolidated net result of operations for the financial year was a profit of $85,834.

DIvIDENDs

There were no dividends declared or paid during the period.

REvIEw Of OpERATIONs

During a year which has presented significant challenges to the uranium exploration sector in Australia, Eromanga Uranium has continued to strengthen its exploration portfolio and maintained its focus on actively drill testing our priority targets. The company identified the potential for the Northern Gawler Craton to host iron oxide, copper, gold and uranium mineralisation (IOCGU) and was able to secure strategic tenure over two significant gravity anomalies in the region. This IOCGU Initiative, centred on the Marla region of northern South Australia, has allowed the company to pursue a dual exploration focus targeting both large IOCGU systems at depth within the basement rocks whilst continuing to test for shallower sandstone-hosted uranium mineralisation around the margins of the Eromanga Basin.

At the Welbourn Hill IOCGU Project the company completed two deep diamond drill holes, EWHDD01 & 02, testing a large coincident gravity/magnetic anomaly. Hole EWHDD02 was successful in intersecting over 350m of intensely altered, variably brecciated and mineralised basement gneisses. Whilst the copper grades returned from this broad intersection were sub-economic, with a best intersection of 18m at 0.1% Cu, the result confirmed the presence of significant volumes of IOCGU type mineralising fluids in the project area and has given strong impetus for further exploration. The second leg of the company’s IOCGU Initiative was focussed on the Nicholson Project where a single 800m deep diamond drill hole, ENDDH01, was completed. The drill hole failed to intersect IOCGU mineralisation but only partially explains the very large gravity anomaly in the project area and the project is under review before further exploration is undertaken.

The primary focus of the company’s sandstone-hosted, or rollfront style, uranium exploration has been on our expansive tenement holdings in the Abminga and Abminga East project areas. The results of airborne EM surveys completed over the entire project area indicated the development of extensive palaeo-drainage systems in the Atlas/Baco area to the north of the township of Marla. An initial rotary-mud drilling program was completed in this area and involved 23 drill-holes for a total of 4,444m. This drilling program confirmed that the palaeodrainages, as interpreted from the airborne EM, were developed in shallow Tertiary sediments that are largely oxidised and not considered prospective for the development of significant uranium mineralisation. However, the drilling also confirmed that the company’s primary target in the deeper Mesozoic age Algebuckina Sandstone remains highly prospective with the drilling returning multiple anomalous gamma responses. Following this initial drill testing, exploration has been directed at better defining the deeper palaeo-drainages using an integrated approach that combines the airborne EM, magnetic and micro-gravity surveys. This approach has been very successful and will allow greater control of drilling during our subsequent drill campaigns.

At the Kingoonya and Billa Kalina Projects the company completed airborne EM surveys, utilising the REPTEM system, over the entire tenement holdings. Detailed computer processing and analysis of the data from these surveys has been very encouraging and has generated multiple drill targets for testing when all access requirements are finalised.

At the Marree Project the results of the first round of rotarymud drilling has focussed the company’s exploration efforts on the more easterly sector of our tenement holdings where higher uranium contents in the local source rocks give greater chances of exploration success.

Eromanga Uranium was successful in its application for new exploration tenure at the Suplejack Project in the Tanami region of the Northern Territory. This area is highly prospective for unconformity-related uranium mineralisation as well as hosting excellent gold potential. Negotiations to finalise an access agreement with the Traditional Owners are underway.

EROMANGA URANIUM LIMITED ACN 119 031 864

DiRectoRS RepoRt

fINANcIAL pOsITION

The net assets of the company have increased by $192,886 during the financial year from $23,533,791 at 30 June 2007 to $23,726,677 at 30 June 2008. The company has been actively undertaking exploration activities and has capitalised $5,931,752 in exploration expenditure during the financial year.

The directors believe the Company is in a strong and stable

financial position to continue its exploration activities.

sIGNIfIcANT cHANGEs IN sTATE Of AffAIRs

There were no significant changes in state of affairs during the financial year.

AfTER BALANcE DATE EvENTs

No circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the consolidated group, the results of those operations, or the state of affairs of the consolidated group in future financial years.

fUTURE DEvELOpMENTs, pROspEcTs AND BUsINEss sTRATEGIEs

At the Abminga and Abminga East Projects drill based exploration programs will continue on a campaign basis throughout 2008-09. It is anticipated that access agreements with the Traditional Owners will be finalised in the second quarter of the year allowing exploration to commence on the highly prospective portion of the project area located in the Northern Territory.

At the Welbourn Hill and Nicholson Projects the company will continue to advance its IOCGU Initiative over the Northern Gawler Craton. A detailed review of all exploration results received to-date is currently underway and will form the basis for decisions on the location of future drilling campaigns.

The second round of drilling is scheduled to commence at the Marree Project early in the second quarter of 2008-09 and initial drill testing at the Kingoonya Project is anticipated to be underway early in the 2009 calendar year.

At the Suplejack Project, in the Tanami region of the Northern Territory, the company is hopeful that all pre-requisite agreements with the Traditional Owners can be in place by the third quarter of the year allowing on-ground exploration to commence immediately following the end of the wet season.

Eromanga Uranium Ltd maintains an active project review and project generation function with a strong focus on assessing acquisition and/or farm-in opportunities over more advanced

uranium properties within Australia. The Company retains a healthy balance sheet and is very well positioned to be an active participant in the growth of the uranium exploration and mining sector in the coming years.

ENvIRONMENTAL IssUEs

The consolidated group’s operations are subject to significant environmental regulation under both Commonwealth and relevant State legislation in relation to discharge of hazardous waste and materials arising from any exploration or mining activities and development conducted by the group on any of its tenements. The group believes it is not in breach of any environmental obligation.

INfORMATION ON DIREcTORs

Robert Michael Kennedy

Non-Executive Chairman - ASAIT, Grad, Dip (Systems Analysis), FCA, ACIS, Life Member AIM, FAICD

A Chartered Accountant and a consultant to Kennedy & Co, Chartered Accountants, a firm he founded. Mr Kennedy has been a director since incorporation 29 March 2006. Mr Kennedy is the Chairman of Beach Petroleum Limited (Director since 1991, Chairman since 1995), Flinders Diamonds Limited (since 2001), Maximus Resources Limited (since 2004), Monax Mining Limited (since 2004), Marmota Energy Limited (since 2006) and Ramelius Resources Limited (since 2004).

Mr Kennedy brings to the Board his expertise in finance and management consultancy and extensive experience as chairman and non-executive director of a range of listed public companies. Mr Kennedy is a member of the Audit Committee.

Kevin James Lines

Managing Director - B.Sc.(Geology), MAusIMM

A director since incorporation 29 March 2006. Mr Lines has over 25 years experience in mineral exploration and mining for gold, copper, lead/zinc and tin. He has held senior geological and management positions within Newmont Australia Limited, Normandy Mining Limited and the CRA group of companies. He was the foundation Chief Geologist at Kalgoorlie Consolidated Gold Mines where he led the team that developed the ore-body models and geological systems for the Super-Pit Operations in Kalgoorlie. He has managed the Eastern Australian Exploration Division of Newmont Australia that included responsibility for the expansive tenement holdings of the Tanami region.

Mr Lines has extensive experience in the assessment and evaluation of exploration projects, development properties and mining operations globally. During the last decade he has completed assignments in China, South America, North America, West Africa, Indonesia, and multiple regions of the Former Soviet Union. Most recently he has acted as Consulting Geologist-Newmont Australia with responsibility for the Western Pacific Region. He is a Member of the Australasian Institute of Mining and Metallurgy.

Mr Lines is a director of Ramelius Resources Limited (since 2008).

EROMANGA URANIUM LIMITED ACN 119 031 864

24 DiRectoRS RepoRt

Kevin John Anson wills

Non-Executive Director - ARSM, PhD, FAusIMM

A director since incorporation 29 March 2006. Dr Kevin Wills is a geologist with 31 years experience in multi commodity mineral exploration including uranium exploration, feasibility studies and mine operations in Australasia. Dr Wills spent seven years with CRA Exploration Pty Ltd, the highlight of which was involvement with the location and evaluation of the Argyle Diamond Deposit. Later, with Penarroya Australia Pty Ltd, his work led to an expansion of reserves at Thalanga and the discovery of the Waterloo base metals deposit.

In the late 1980s, Dr Wills was exploration manager with Metana Minerals NL. He built up a successful exploration team which extended known gold ore bodies and made new discoveries. In the early 1990s, Dr Wills was regional exploration manager with Dominion Mining Ltd, based in Adelaide. His work on the Gawler Craton led to the development of a calcrete sampling technique which, later on, was instrumental in the Challenger gold discovery.

Dr Wills is currently managing director of Flinders Diamonds Limited (since 2000) and Maximus Resources Limited (since 2004). He is a past chairman of the Adelaide Branch of the AusIMM and the Exploration Committee at the South Australian Chamber of Mines and Energy.

Ewan John vickery

Non-Executive Director – L.LB

A director since incorporation 29 March 2006. Mr Vickery is a corporate and business lawyer with over 30 years experience in private practice in Adelaide. He has acted as an advisor to companies on a variety of corporate and business issues including capital and corporate restructuring, native title and land access issues, and as lead native title advisor and negotiator for numerous mining and petroleum companies.

Mr Vickery is a Director of Flinders Diamonds Limited (since 2001), Maximus Resources Limited (since 2004) and member of the Exploration Committee of the South Australian Chamber of Mines and Energy Inc, the International Bar Association Energy and Resources Law Section, the Australian Institute of Company Directors and is a past national president of Australian Mining and Petroleum Law Association (AMPLA Limited).

Mr Vickery is the Chairman of the audit committee.

Adam Bannister

Alternate for E J Vickery (Non Executive) – L.LB

Alternate Director since 22 May 2006. Mr Bannister is a lawyer who has specialised in commercial litigation for 20 years. He is the Lead litigation lawyer for the Adelaide and Darwin partnership of Minter Ellison and sits on the Firm’s Board.

Mr Bannister has successfully prosecuted and defended claims on behalf of public and private organisations across every industry sector. He has a special interest in competition law, regulatory matters and complex large scale litigation chiefly in the areas of building and construction and technology and information law.

REMUNERATION REpORT (AUDITED)

Remuneration of Directors and key management personnel

This report details the nature and amount of remuneration for each key management person of the Company and for the executives receiving the highest remuneration.

(a) Directors and key management personnel

The names and positions held by Directors and key management personnel of the Company during the financial year are:

Name position

Mr R M Kennedy Chairman - Non-executive Mr E J Vickery Director - Non-executive Dr K J A Wills Director - Non-executive Mr K J Lines Managing Director - Executive Mr A Bannister Alternate Director Mr R W C Willson Chief Financial Officer / Company Secretary

(b) Directors and key management personnel Remuneration

2008 Primary Benefits	2008 Primary Benefits	2008 Primary Benefits	2008 Primary Benefits	2008 Primary Benefits	2008 Primary Benefits	2008 Primary Benefits	2008 Primary Benefits
Directors	Directors fees	Salary	Non cash items	Cash bonus	Super contri- butions	Options	Total
	$	$	$	$	$	$	$
Mr R M Kennedy 77,981 - - - 7,019 - 85,000 Mr E J Vickery 50,000 - - - - - 50,000 Dr K J A Wills 45,872 - - - 4,128 - 50,000 Mr K J Lines - 248,463 - - 20,642 - 269,105 Mr A Bannister - - - - - - - Mr R W C Willson* - 197,432 - - 16,325 8,910 222,667
173,853 445,895 - - 48,114 8,910 676,772

2007 Primary Benefits	2007 Primary Benefits	2007 Primary Benefits	2007 Primary Benefits	2007 Primary Benefits	2007 Primary Benefits	2007 Primary Benefits	2007 Primary Benefits
Directors	Directors fees	Salary	Non cash items	Cash bonus	Super contri- butions	Options	Total
	$	$	$	$	$	$	$
Mr R M Kennedy 48,930 - - - 4,404 - 53,334 Mr E J Vickery 30,000 - - - - - 30,000 Dr K J A Wills 27,523 - - - 2477 - 30,000 Mr K J Lines - 188,837 - - 16,994 - 205,832 Mr A Bannister - - - - - - - Mr R W C Willson* - 155,768 - - 14,019 8,800 178,587
106,453 344,605 - - 37,895 8,800 497,753

Director’s fees for Mr Vickery are paid to a related entity of the Director
** Mr Willson is employed by FME Exploration Services Pty Ltd. His services are provided as part of the services agreement in place between FME Exploration Services Pty Ltd and Eromanga Uranium Ltd. The management fees paid by Eromanga Uranium Ltd are outlined in Note 23. This agreement was formalised 3 August 2006.

The Directors conclude that there are no other executives requiring disclosure other than those listed.

EROMANGA URANIUM LIMITED ACN 119 031 864

DiRectoRS RepoRt

(c) service agreements

During the financial year, the Company reviewed the employment agreement of Mr Lines in respect of his services as Managing Director. The salary was set at $250,000 per annum inclusive of superannuation guarantee contributions to be reviewed periodically. There were neither post employment retirement benefits previously approved by members of the Company in a general meeting nor any paid to Directors of the Company. There were no post employment retirement benefits paid or payable to key management personnel.

Employee share Option plan

The Company has an Employee Share Option Plan approved by shareholders that enables the Board to offer eligible employees options to acquire ordinary fully paid shares in the Company. Under the terms of the Plan, options to acquire ordinary fully paid shares may be offered to the Company’s eligible employees at no cost unless otherwise determined by the Board in accordance with the terms and conditions of the Plan. During the year 860,500 options with a fair value of $107,052 were issued to employees at no cost. No employee share options were issued to the Directors during the year.

REMUNERATION pRAcTIcEs

The Company’s policy for determining the nature and amounts of emoluments of board members and senior executive officers of the Company is as follows.

The Company’s Constitution specifies that the total amount of remuneration of Non-executive Directors shall be fixed from time to time by a general meeting. The current maximum aggregate remuneration of Non-executive Directors has been set at $300,000 per annum. Directors may apportion any amount up to this maximum amount amongst the Nonexecutive Directors as they determine. Directors are also entitled to be paid reasonable travelling, accommodation and other expenses incurred in performing their duties as Directors. The remuneration of the Managing Director is determined by the Non-executive Directors on the Board as part of the terms and conditions of his employment which are subject to review from time to time. The remuneration of other executive officers and employees is determined by the Managing Director subject to the approval of the Board.

Non-executive Director remuneration is by way of fees and statutory superannuation contributions. Non-executive Directors do not participate in schemes designed for remuneration of executives nor do they receive options or bonus payments and are not provided with retirement benefits other than salary sacrifice and statutory superannuation.

The Company does not presently emphasize payment for results through the provision of cash bonus schemes or other incentive payments based on key performance indicators of the Company given the nature of the Company’s business as a recently listed junior mineral exploration entity and the current status of its activities. However the Board may approve the payment of cash bonuses from time to time in order to reward individual executive performance in achieving key objectives as considered appropriate by the Board.

The Company also has an Employee Share Option Plan approved by shareholders that enables the Board to offer eligible employees options to acquire ordinary fully paid shares in the Company. Under the terms of the Plan, options for ordinary fully paid shares may be offered to the Company’s eligible employees at no cost unless otherwise determined by the Board in accordance with the terms and conditions of the Plan. The objective of the Plan is to align the interests of employees and shareholders by providing employees of the Company with the opportunity to participate in the equity of the Company as an incentive to achieve greater success and profitability for the Company and to maximise the long term performance of the Company.

The employment conditions of the Managing Director, Mr Lines are formalised in a contract of employment. The base salary as set out in the employment contract is reviewed annually. The Managing Directors’ contract may be terminated at any time by mutual agreement. The Company may terminate this contract without notice in serious instances of misconduct.

OpTIONs GRANTED As REMUNERATION

Apart from the options granted under the Company’s Employee Share Option Plan as detailed above, no other options were granted to Directors or key management personnel of the Company during the financial year.

sHAREs IssUED ON EXERcIsE Of REMUNERATION OpTIONs

No shares were issued to Directors as a result of the exercise of remuneration options during the financial year.

DIREcTORs’ INTEREsTs IN sHAREs AND OpTIONs

Directors’ relevant interests in shares and options of the Company are disclosed in note 5 to the accounts.

EROMANGA URANIUM LIMITED ACN 119 031 864

MEETINGs Of DIREcTORs

During the financial year, 14 meetings of directors (including committees of directors) were held. Attendances by each director during the year were as follows:

	Directors meetings	Directors meetings	Audit Committee meeting	Audit Committee meeting
	Number eligible to attend	Number attended	Number eligible to attend	Number attended
R M Kennedy 12 12 2 2 K J Lines 12 12 1 1 K J A Wills 12 12 1 1 E J Vickery 12 12 2 2 A Bannister - - - -

INDEMNIfIcATION AND INsURANcE Of OffIcERs

Indemnification

The Company is required to indemnify the Directors and other officers of the company against any liabilities incurred by the Directors and officers that may arise from their position as Directors and officers of the Company. No costs were incurred during the year pursuant to this indemnity.

The Company has entered into deeds of indemnity with each Director whereby, to the extent permitted by the Corporations Act 2001, the Company agreed to indemnify each Director against all loss and liability incurred as an officer of the Company, including all liability in defending any relevant proceedings.

Insurance premiums

Since the end of the previous year the Company has paid insurance premiums in respect of Directors’ and officers’ liability and legal expenses’ insurance contracts.

OpTIONs

Since the end of the financial year no shares were issued as a result of the exercise of options as follows. There were no amounts unpaid on shares issued.

pROcEEDINGs ON BEHALf Of cOMpANy

No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings.

The Company was not a party to any such proceedings during the financial year.

NON-AUDIT sERvIcEs

The Board of directors, in accordance with advice from the audit committee, is satisfied that the provision of non-audit services during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the services disclosed below did not compromise the external auditor’s independence for the following reasons:

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

There were no fees for non-audit services paid/payable to the external auditors during the year ended 30 June 2008.

AUDITOR’s INDEpENDENcE DEcLARATION

The lead auditor’s independence declaration for the year ended 30 June 2008 has been received and can be found on page 27 of the directors’ report.

Dated at Adelaide this 24th day of September 2008 and signed in accordance with a resolution of the directors.

At the date of this report, the unissued ordinary shares of Eromanga Uranium Limited under option are as follows:

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Grant date Date of expiry Exercise price Number under
Option
4 April 2006 30 June 2011 $0.30 17,500,000
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Robert M Kennedy Chairman

20 June 2006	30 June 2011	$0.30	1,250,000
26 October 2006	30 June 2011	$0.30	8,035,714
10 April 2007	20 March 2012	$0.22	283,000
16 November 2007	19 November 2012	$0.22	225,000
5 March 2008	5 March 2013	$0.165	635,500
			27,929,214

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

EROMANGA URANIUM LIMITED ACN 119 031 864

auDitoRS inDepenDence DeclaRation

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EROMANGA URANIUM LIMITED ACN 119 031 864

incoMe StateMent

For the year ended 30 June 2008

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Note Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
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	2008 $ 2007 $ 2008 $ 2007 $
Revenue 2 Marketing expenses 3 Administrative expense 3 Exploration expense Finance costs Other expenses Profit / (loss) before income tax Income tax expense 4 Profit / (loss) for the period attributable to shareholders of the company Basic earnings / (loss) per share (cents) 7 Diluted earnings / (loss) per share (cents) 7	647,964 621,256 647,964 621,256 48,572 240,403 48,572 240,403 338,741 739,132 338,741 739,132 173,740 67,076 173,740 67,076 374 1,411 374 1,411 703 3,278 703 3,278
	85,834 (430,044) 85,834 (430,044) - 287,601 - 287,601
	85,834 (717,645) 85,834 (717,645)
	0.07 (0.79) 0.07 (0.79)

The accompanying notes form part of these financial statements.

EROMANGA URANIUM LIMITED ACN 119 031 864

As at 30 June 2008

Balance Sheet

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Note Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
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CURRENT ASSETS Cash and cash equivalents 8 Trade and other receivables 9 TOTAL CURRENT ASSETS NON-CURRENT ASSETS Trade and other receivables 9 Plant and equipment 14 Investments accounted for using the equity method 10 Financial assets 12 Exploration and evaluation expenditure 15 TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables 16 Short-term provisions 17 TOTAL CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital 18 Reserves 19 Retained earnings TOTAL EQUITY	6,539,055 12,041,138 6,539,055 12,041,138 469,263 425,740 469,263 425,740
	7,008,318 12,466,878 7,008,318 12,466,878
	- - 7,232,906 1,301,154 397,927 360,234 397,927 360,234 1 1 1 1 - - 9,626,536 9,626,536 16,859,442 10,927,690 - -
	17,257,370 11,287,925 17,257,370 11,287,925
	24,265,688 23,754,803 24,265,688 23,754,803
	514,818 208,654 514,818 208,654 24,193 12,358 24,193 12,358
	539,011 221,012 539,011 221,012
	539,011 221,012 539,011 221,012

	23,726,677 23,533,791 23,726,677 23,533,791
	23,543,734 23,543,734 23,543,734 23,543,734 847,332 740,280 847,332 740,280 (664,389) (750,223) (664,389) (750,223)
	23,726,677 23,533,791 23,726,677 23,533,791

The accompanying notes form part of these financial statements.

EROMANGA URANIUM LIMITED ACN 119 031 864

StateMent oF chanGeS in equity

For the year ended 30 June 2008

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Issued Capital Share Option Retained Total
Reserve Earnings
$ $ $ $
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CONSOLIDATED GROUP Balance at 1 July 2006 Profit / (loss) for the period Shares issued during the period Options issued during the period Transaction costs (net of tax) Balance at 30 June 2007 Profit / (loss) for the period Shares issued during the period Options issued during the period Transaction costs (net of tax) Balance at 30 June 2008 PARENT ENTITY Balance at 1 July 2006 Profit / (loss) for the period Shares issued during the period Options issued during the period Transaction costs (net of tax) Balance at 30 June 2007 Profit / (loss) for the period Shares issued during the period Options issued during the period Transaction costs (net of tax) Balance at 30 June 2008	581,503 - (32,578) 548,925 - - (717,645) (717,645) 23,638,300 - - 23,638,300 - 740,280 - 740,280 (676,069) - - (676,069)
	23,543,734 740,280 (750,223) 23,533,791
	- - 85,834 85,834 - - - - - 107,052 - 107,052 - - - -
	23,543,734 847,332 (664,389) 23,726,677
	581,503 - (32,578) 548,925 - - (717,645) (717,645) 23,638,300 - - 23,638,300 - 740,280 - 740,280 (676,069) - - (676,069)
	23,543,734 740,280 (750,223) 23,533,791
	- - 85,834 85,834 - - - - - 107,052 - 107,052 - - - -
	23,543,734 847,332 (664,389) 23,726,677

The accompanying notes form part of these financial statements.

EROMANGA URANIUM LIMITED ACN 119 031 864

For the year ended 30 June 2008

caSh Flow StateMent

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Note Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
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CASH FLOWS FROM OPERATING ACTIVITIES Interest received Payments to suppliers and employees Net cash provided by (used in) operating activities 21 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of plant and equipment Purchase of subsidiaries Payment for exploration activities Loans to related entities Net cash provided by (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares Capital raising costs Net cash provided by (used in) financing activities Net increase (decrease) in cash held Cash at beginning of financial year Cash at end of financial year 8	852,810 318,403 852,810 318,403 (197,229) (993,141) (197,229) (993,141)
	655,581 (674,738) 655,581 (674,738)
	(93,602) (376,510) (93,602) (376,510) - - - (66,537) (5,931,752) (1,265,327) - - (132,310) - (6,064,062) (1,198,790)
	(6,157,664) (1,641,837) (6,157,664) (1,641,837)
	- 14,758,300 - 14,758,300 - (911,687) - (911,687)
	- 13,846,613 - 13,846,613
	(5,502,083) 11,530,038 (5,502,083) 11,530,038
	12,041,138 511,100 12,041,138 511,100
	6,539,055 12,041,138 6,539,055 12,041,138

The accompanying notes form part of these financial statements.

EROMANGA URANIUM LIMITED ACN 119 031 864

noteS to the Financial StateMentS

For the year ended 30 June 2008

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial report includes separate financial statements for Eromanga Uranium Limited as an individual entity and the consolidated entity consisting of Eromanga Uranium Limited and its subsidiaries.

Basis of preparation

This general purpose financial report has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting standards board, Urgent Issues group Interpretations and corporations Act 2001.

Compliance with IFRS

Australian Accounting Standards include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report of Eromanga Uranium Limited complies with International Financial Reporting Standards. (IFRS).

Historical cost convention

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

Accounting policies

a) Principles of consolidation

A controlled entity is any entity Eromanga Uranium Limited has the power to control the financial and operating policies of so as to obtain benefits from its activities.

A list of controlled entities is contained in Note 13 to the financial statements. All controlled entities have a June financial year-end.

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

Where controlled entities have entered or left the consolidated group during the year, their operating results have been included/excluded from the date control was obtained or until the date control ceased.

b) Income tax

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

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

Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well unused tax losses.

Current and deferred income tax expense (income) is charged or credited directly to equity instead of the profit or loss when the tax relates to items that are credited or charged directly to equity.

Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been fully expensed but future tax deductions are

available. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.

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

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

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

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

c) Plant and equipment

Each class of plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment losses.

Plant and equipment

Plant and equipment are measured on the cost basis.

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

Subsequent costs are included in the assets’ carrying amount or recognised as separate assets, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which are they are incurred.

Depreciation

The depreciable amount of all fixed assets is depreciated on a straight-line basis over their useful lives to the consolidated group commencing from the time the asset is held ready for use.

The depreciation rates used for each class of depreciable assets are:

Class of non current asset	Depreciation rate	Basis of depreciation
Plant and equipment 12.5–40% Straight line

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

EROMANGA URANIUM LIMITED ACN 119 031 864

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An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined in comparing proceeds with the carrying amount. These gains and losses are included in the income statement. When re-valued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.

d) Exploration expenditure

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

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

When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the economically recoverable reserves.

A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest.

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

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

e) Financial instruments

Recognition and initial measurement

Financial instruments, incorporation financial assets and financial liabilities, are recognised when the entity becomes a party to the contractual provisions of the instrument. Trade date accounting is adopted for financial assets that are delivered within timeframes established by marketplace convention.

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

Derecognition

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

Classification and subsequent measurement

(i) Loans and receivables

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

(ii) Available-for-sale financial assets

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

Fair value

Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.

Impairment

At each reporting date, the group assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen. Impairment losses are recognised in the income statement.

f) Impairment of assets

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

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

g) Investments in associates

Investments in associate companies are recognised in the financial statements by applying the equity method of accounting. The equity method of accounting recognised the group’s share of post-acquisition reserves of its associates.

h) Interests in joint ventures

The consolidated group’s share of the assets, liabilities, revenue and expenses of joint venture operations are included in the appropriate items of the consolidated financial statements. Details of the consolidated group’s interests are shown at Note 11.

The consolidated group’s interests in joint venture entities are brought to account using the equity method of accounting in the consolidated financial statements. The parent entity’s interests in joint venture entities are brought to account using the cost method.

i) Employee benefits

Provision is made for the group’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits.

EROMANGA URANIUM LIMITED ACN 119 031 864

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Equity-settled compensation

The cost of equity-settled transactions is measured by the fair value at the date at which the equity instruments are granted. The fair value is determined using the Black-Scholes pricing model. The cost is recognised as an expense in the income statement with a corresponding increase in the share option reserve or issued capital when the options or shares are issued.

j) Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts.

k) Revenue

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

l) Goods and Services Tax (GST)

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

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

m) Comparative figures

When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

Critical accounting estimates and judgments

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

Key estimates — impairment

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

NOTE 2. REVENUE

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Operating activities Interest received from other persons NOTE 3. PROFIT/(LOSS) FOR THE YEAR	647,964 621,256 647,964 621,256
	Consolidated Group		Parent Entity
	2008 $	2007 $	2008 $	2007 $
Marketing expenses Company promotion Corporate consulting Public relations Subscriptions Conferences Other Administration expenses Accounting ASX fees Audit Depreciation Depreciation capitalised - exploration and evaluation Insurance Legal fees Management services Employee benefits expense Share registry Other	1,983 141,229 1,983 141,229 24,694 41,560 24,694 41,560 516 13,983 516 13,983 10,349 24,840 10,349 24,840 6,115 15,994 6,115 15,994 4,915 2,797 4,915 2,797
	48,572 240,403 48,572 240,403
	1,770 6,842 1,770 6,842 7,478 54,275 7,478 54,275 21,000 23,929 21,000 23,929 697 16,276 697 16,276 – (5,551) – (5,551) 13,694 25,895 13,694 25,895 – 21,917 – 21,917 97,308 135,331 97,308 135,331 114,621 309,154 114,621 309,154 10,657 45,930 10,657 45,930 78,206 141,084 78,206 141,084
	338,741 739,132 338,741 739,132

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 4. INCOME TAX EXPENSE

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Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
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a.	The components of tax expense comprise:
	Current tax	-	287,601	-	287,601
	Deferred tax	-	-	-	-
		-	287,601	-	287,601
b.	The prima facie tax on profit from ordinary	activities before	income tax is reconciled to the income tax
	as follows:
	Profit/(loss) for the year before income tax	25,750	(1,471)	25,750	(1,471)
	Tax effect of:
	Add
	- Non-allowable items	12,335	66,424	12,335	66,424
	- Share options expensed during the year	32,116	13,584	32,116	13,584
	- Share placement issue costs	-	287,601	-	287,601
	Recoupement of prior year tax losses not brought to
	account	(70,201)	(78,537)	(70,201)	(78,537)
		-	287,601	-	287,601

Deferred tax assets on the timing differences have not been recognised as they do not meet the recognition criteria as outlined in Note 1(b) in the financial statements.

NOTE 5. KEY MANAGEMENT PERSONNEL COMPENSATION

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

Key management person	Position
R M Kennedy	Non-Executive Chairman
K J Lines	Managing Director
E J Vickery	Non-Executive Director
K J A Wills	Non-Executive Director
R W C Willson	Chief Financial Officer & Company Secretary
A Bannister	Alternate Director for E J Vickery

Key management personnel renumeration has been included in the Remuneration Report section of the Directors Report.

b. Options and Rights Holdings
Number of options held by key management personnel.

	Balance 1.7.2007	Issued as remuneration	Net change other	Balance 30.6.2008	Total vested 30.6.2008	Total exercisable 30.6.2008	Total unexercisable 30.6.2008
R M Kennedy() K J Lines() K J A Wills E J Vickery() R W C Willson() A Bannister	3,500,000 - - 3,500,000 3,500,000 3,500,000 - 4,375,000 - - 4,375,000 4,375,000 4,375,000 - 3,500,000 - - 3,500,000 3,500,000 3,500,000 - 3,500,000 - (3,272,875) 227,125 227,125 227,125 - 305,000 77,000 382,000 382,000 382,000 - - - - - - -
	15,180,000 77,000 (3,272,875) 11,984,125 11,984,125 11,984,125 -

c. Share Holdings

Number of shares held by key management personnel.

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Balance Received as Net change other Balance
1.7.2007 compensation 30.6.2008
R M Kennedy [()] 3,640,001 - 65,999 3,706,000
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K J Lines() K J A Wills E J Vickery() R W C Willson(*) A Bannister	4,475,001 - - 4,475,001 3,500,000 - - 3,500,000 4,050,001 - (3,693,674) 356,327 200,000 - - 200,000 - - - -
	15,865,003 - (3,627,675) 12,237,328

(*) Held by Directors and entities in which Directors have a relevant interest.

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 6. AUDITORS REMUNERATION

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Remuneration of the auditor of the company for: - Auditing or reviewing the financial report - Independent Report for Prospectus NOTE 7. EARNINGS PER SHARE	21,000 23,929 21,000 23,929 - 10,000 - 10,000
	21,000 33,929 21,000 33,929

			2008	2007
Earnings used to calculate basic and dilutive EPS $85,834 ($717,645) Weighted average number of ordinary shares outstanding during the year used to calculate basic EPS 125,442,346 91,185,178 Weighted average number of options outstanding during the year used to calculate dilutive EPS - Weighted average number of ordinary shares outstanding during the year used to calculate dilutive EPS 125,442,346 91,185,178

The weighted average number of options on issue at 30 June 2008 was 27,411,737 (2007: 24,136,714). Options have an anti dilutive effect and therefore have not been included in the calculation of earnings per share.

NOTE 8. CASH AND CASH EQUIVALENTS

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Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
Cash at bank and in hand 439,055 1,141,138 439,055 1,141,138
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Short-term bank deposits The effective interest rate on short-term bank deposits was 7.9% (2007 - 6.5%) These deposits have an average maturity of 83 days. Reconciliation of cash Cash at the end of the financial year as shown in the cash flow statement is reconciled to items in the balance sheet as follows: Cash and cash equivalents	6,100,000 10,900,000 6,100,000 10,900,000
	6,539,055 12,041,138 6,539,055 12,041,138

	6,539,055 12,041,138 6,539,055 12,041,138

NOTE 9. TRADE AND OTHER RECEIVABLES

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Note Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
Current
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Interest receivable Receivable from FME Exploration Services Pty Ltd 9a Other receivable Non Current Receivable from Eromanga Uranium Resources Pty Ltd 9b	98,008 302,854 98,008 302,854 250,000 117,690 250,000 117,690 121,255 5,196 121,255 5,196
	469,263 425,740 469,263 425,740
	- - 7,232,906 1,301,154
	- - 7,232,906 1,301,154

9a The entity advanced this amount to assist in the funding of working capital. The entity provides support to the associated company to ensure it can pay its debts as and when they fall due and payable.

This receivable from the associated company is repayable at call and interest at market rates can be charged at the discretion of the Directors of Eromanga. The entity will not seek repayment where such repayments would prejudice the associated company’s ability to meet any obligations as and when they fall due.

9b The parent entity advanced this amount to assist in the funding of working capital. The parent entity provides support to the subsidiary to ensure it can pay its debts as and when they fall due and payable.

This receivable from the subsidiary has no fixed date for repayment and is non interest bearing. The parent entity will not seek repayment where such repayments would prejudice the subsidary’s ability to meet any obligations as and when they fall due.

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 10. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Interests are held in the following associated companies.

Name	Principal activities	Country of incorporation	Shares	Ownership interest	Ownership interest	Carrying amount of investment	Carrying amount of investment
				2008 %	2007 %	2008 $	2007 $
Unlisted: FME Exploration Services Pty Ltd Administration Services Australia Ord 33.3 33.3 1 1

a. Summarised presentation of aggregate assets, liabilities and performance of associate.

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Current assets Non current assets Total assets Current liabilities Total liabilities Net assets Share of associate’s profit after tax	366,430 114,142 366,430 114,142 478,183 321,184 478,183 321,184
	844,613 435,326 844,613 435,326
	844,610 435,323 844,610 435,323
	844,610 435,323 844,610 435,323
	3 3 3 3
	- - - -

NOTE 11. JOINT VENTURES

The Consolidated group has the following interests in Joint Ventures:

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No. State Agreement Name Parties Summary
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1	SA & NT	Eromanga Basin	Eromanga Uranium Ltd	ERO can earn a 70% interest in MXR’s Eromanga Basin project
		Joint Venture	(ERO)_and_Maximus	tenements in SA and the NT by spending $7 000 000 on the
			Resources Ltd (MXR)	tenements within 6 years
2	SA	Billa Kalina Joint	ERO_and_MXR	ERO can earn a 50% interest in the non-diamond mineral rights of
		Venture		MXR’s Billa Kalina project tenements by spending $3 000 000 on
				the tenements within 6 years
3	SA	Abminga Project	ERO_and_Caldera	ERO has earned 100% of the uranium rights in EL 3186 for a cash
		– Letter of Offer –	Resources Pty Ltd_and_	payment of $20 000 and a commitment to undertake an airborne
		EL 3186	Ellendale Resources NL	EM survey over the project area within 12 months and to maintain
				the tenement in good standing
4	SA	Todmorden Project	ERO_and_International	ERO may earn a 60% interest in the JV by spending $250 000 on
			Metals Ltd	EL4001 within a maximum 2 year period and a further 20% by
				spending an additional $250 000 within a further maximum 2 year
				period

NOTE 12 FINANCIAL ASSETS

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Available for sale financial assets Available for sale financial assets comprise Unlisted investments at cost - Shares in controlled entities Total available for sale financial assets	- - 9,626,536 9,626,536
	- - 9,626,536 9,626,536
	- - 9,626,536 9,626,536

Available for sale financial assets comprise investments in the ordinary issued capital of Eromanga Uranium Resources Pty Ltd. There are no fixed returns or fixed maturity date attached to this investment. The fair value of unlisted available for sale financial assets cannot be readily measured as variability in the range of reasonable fair value estimates is significant. As a result, all unlisted investments are reflected at cost.

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 13. CONTROLLED ENTITIES

Controlled Entities Consolidated

	Country of Incorporation	Percentage Owned (%)	Percentage Owned (%)
		2008	2007
Parent Entity Eromanga Uranium Limited Australia Subsidiaries of Eromanga Uranium Limited Eromanga Uranium Resources Pty Ltd Australia 100 100

NOTE 14. PLANT AND EQUIPMENT

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Plant and equipment at cost Accumulated depreciation Total plant and equipment	470,112 376,510 470,112 376,510 (72,185) (16,276) (72,185) (16,276)
	397,927 360,234 397,927 360,234

Movements in carrying amounts:

Movements in the carrying amounts for each class of plant and equipment between the beginning and the end of the current financial year.

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Consolidated Group Parent Entity
Plant and Total Plant and Total
equipment equipment
- - - -
Balance at 1 July 2006
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Additions Disposals Depreciation Balance at 30 June 2007 Additions Disposals Depreciation Balance at 30 June 2008	376,510 376,510 376,510 376,510 - - - - (16,276) (16,276) (16,276) (16,276)
	360,234 360,234 360,234 360,234
	93,602 93,602 93,602 93,602 - - - - (55,909) (55,909) (55,909) (55,909)
	397,927 397,927 397,927 397,927

NOTE 15. CAPITALISED EXPLORATION AND EVALUATION EXPENDITURE

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Consolidated Group Parent Entity
2008 2007 2008 2007
$ $ $ $
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Exploration and evaluation phases - Joint Ventures Total exploration and evaluation expenditure Movements in carrying amounts: Exploration and evaluation Balance at the beginning of the year Amounts capitalised during the year Recognised through acquisition of subsidiary Carrying amount at the end of year	16,859,442 10,927,690 - -
	16,859,442 10,927,690 - -
	10,927,690 - - - 5,931,752 1,301,154 - - - 9,626,536 - -
	16,859,442 10,927,690 - -

The ultimate recoupment of costs carried forward for exploration phase is dependent on the successful development and commercial exploitation or sale of the respective areas.

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 16. TRADE AND OTHER PAYABLES

	Consolidated Group	Parent Entity
	2008 $ 2007 $ 2008 $ 2007 $ 461,267 135,584 461,267 135,584 15,000 52,186 15,000 52,186 38,551 20,884 38,551 20,884
Unsecured Trade payables Sundry payables and accrued expenses Amounts payable to associated companies for management services
	514,818 208,654 514,818 208,654

NOTE 17. SHORT-TERM PROVISIONS

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Employee entitlements Opening balance at 1 July 2007 Additional provisions Amounts used Balance at 30 June 2008 NOTE 18. ISSUED CAPITAL	24,193 12,358 24,193 12,358
	12,358 - 12,358 - 57,510 25,419 57,510 25,419 (45,675) (13,061) (45,675) (13,061)
	24,193 12,358 24,193 12,358

	Consolidated Group		Parent Entity
	2008 $	2007 $	2008 $	2007 $
125,442,346 (2007: 125,442,346) fully paid ordinary shares	23,543,734 23,543,734 23,543,734 23,543,734

	Number	Number	Number	Number
Ordinary Shares At the beginning of the reporting period Shares issued during the year 16/10/2006 26/10/2006 31/10/2006	125,442,346 21,972,003 125,442,346 21,972,003 80,000 80,000 44,357,143 44,357,143 59,033,200 59,033,200
	125,442,346 125,442,346 125,442,346 125,442,346

Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of shares held. At shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.

At the date of this report there were 62,107,143 shares under escrow until 31 October 2008.

Options

For information relating to options issued as part consideration of the purchase of Eromanga Uranium Resources Pty Ltd refer to Note 22 Share Based Payments.

For information relating to the Eromanga Uranium Limited Employee option plan including details of options issued and exercised during the finacial year and the options outstanding at year end refer to Note 22 Share Based Payments.

NOTE 19. RESERVES

Share Option Reserve

The Share Option Reserve records items recognised as expenses on valuation of employee options and options issued to external parties in consideration for goods and services rendered.

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 20. COMMITMENTS FOR EXPENDITURE

Exploration Licences

In order to maintain current rights of tenure to exploration tenements the group will be required to outlay in the year ending 30 June 2009 amounts of approximately $3,500,000 in respect of tenement lease rentals and to meet minimum expenditure requirements pursuant to various joint venture requirements.

NOTE 21. CASH FLOW INFORMATION

Reconciliation of cash flow from operations with loss after income tax.

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Consolidated Group Parent Entity
2008 2007 2008 2007
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Profit (Loss) after tax Non-cash flows in loss Depreciation Issue of options to employees Deferred tax asset written off Changes in operating assets and liabilities Decrease/(Increase) in trade and other receivables Decrease/(Increase) in other assets Increase/(Decrease) in trade and other payables Increase/(Decrease) in provisions Net cash used in operating activities	85,834 (717,645) 85,834 (717,645) 55,909 16,276 55,909 16,276 107,052 45,280 107,052 45,280 - 287,601 - 287,601 88,787 (417,727) 88,787 (417,727) - 79,399 - 79,399 307,242 19,720 307,242 19,720 10,757 12,358 10,757 12,358
	655,581 (674,738) 655,581 (674,738)

NOTE 22. SHARE-BASED PAYMENTS

The following share-based payment arrangement existed at 30 June 2008:

On 4 April 2006 17,500,000 options were issued to the Directors and promoters of the Company upon incorporation. The options are exercisable at 30 cents on or before 30 June 2011. The options hold no voting or dividend rights. On 20 June 2006 1,250,000 options were issued to the Company Secretary and the Company’s Corporate Advisors. The options are exercisable at 30 cents on or before 30 June 2011. The options hold no voting or dividend rights.

On 26 October 2006 8,035,714 options were issued as part consideration for the purchase of Eromanga Uranium Resources Pty Ltd. The options are exercisable at 30 cents on or before 30 June 2011. The options hold no voting or dividend rights.

On 10 April 2007 283,000 options were issued to employees under the Company’s employee option plan. The options are exercisable at 22 cents on or before 20 March 2012. The options hold no voting or dividend rights. On 16 November 2007 225,000 options were issued to employees under the Company’s employee option plan. The options are exercisable at 22 cents on or before 19 November 2012. The options hold no voting or dividend rights.

On 5 March 2008 635,500 options were issued to employees under the Company’s employee option plan. The options are exercisable at 16.5 cents on or before 5 March 2013. The options hold no voting or dividend rights.

	Consolidated Group	Consolidated Group	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity	Parent Entity	Parent Entity
	2008		2007		2008		2007
	Number of Options	Weighted average Exercise Price $	Number of Options	Weighted average Exercise Price $	Number of Options	Weighted average Exercise Price $	Number of Options	Weighted average Exercise Price $
Outstanding at the beginning of the year Granted Outstanding at the end of the year Exercisable at year end	27,068,714 0.299 18,750,000 0.300 27,068,714 0.299 18,750,000 0.300 860,500 0.179 8,318,714 0.297 860,500 0.179 8,318,714 0.297
	27,929,214 0.295 27,068,714 0.299 27,929,214 0.295 27,068,714 0.299

	27,929,214 0.295 27,068,714 0.299 27,929,214 0.295 27,068,714 0.299

EROMANGA URANIUM LIMITED ACN 119 031 864

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NOTE 22. SHARE-BASED PAYMENTS continued

The options outstanding at 30 June 2008 had a weighted average exercise price of $0.295 and a weighted average remaining contractual life of 3 years. Exercise prices range from $0.165 to $0.30 in respect of options outstanding at 30 June 2008.

The weighted average fair value of the options granted during the year was $0.124.

This price was calculated by using a Black Scholes option pricing model applying the following inputs: Weighted average exercise price $0.179 Weighted average life of the option 5.0 years Underlying share price $0.16 Expected share price volatility 104.9% Risk free interest rate 6.87%

Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is indicative of future trends, which may not eventuate. The life of the options is based on the historical exercise patterns, which may not eventuate in the future. Included under “Administrative Expense” in the income statement is $107,052 (2007: $45,280) which relates to share-based payments in accordance with the Company’s Share Option Plan. An amount of $690,000 (2007: $690,000) is included in the Investment in Eromanga Uranium Resources Pty Ltd representing the value of the options given as part consideration of the acquisition of Eromanga Uranium Resources Pty Ltd.

NOTE 23. EVENTS AFTER THE BALANCE SHEET DATE

NOTE 24. RELATED PARTY TRANSACTIONS

Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

Associated companies

Administrative services were provided by FME Exploration Services Pty Ltd to Eromanga Uranium Limited for $393,763.
Eromanga Uranium Limited advanced FME Exploration Services Pty Ltd $132,310 to fund working capital.

Other related parties

Payments during the period to Flinders Diamonds Limited for expenses incurred on behalf of Eromanga Uranium Limited totalled $1,748.
Payments during the period to Maximus Resources Limited for expenses incurred on behalf of Eromanga Uranium Limited totalled $452.

NOTE 25. SEGMENT INFORMATION

The entity operates predominately in the mining industry, in Australia and as such has no material reportable segments.

EROMANGA URANIUM LIMITED ACN 119 031 864

42 noteS to the Financial StateMentS continueD

NOTE 26. FINANCIAL INSTRUMENTS

a. Financial risk management

The group’s financial instruments consist mainly of deposits with banks, accounts receivable and payable, and loans to subsidiaries.

i Treasury risk management

The senior executives of the group regularly analyse interest rate exposure and evaluate treasury management strategies in the context of the most recent economic conditions and forecasts.

ii Financial risks

The main risk the group is exposed to through its financial instruments is liquidity risk.

Liquidity risk

The group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate funds are available to meet the cash demands.

b. Financial instruments

i) Interest rate risk

The consolidated group’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of changes in market interest rates and the effective weighted average interest rates on classes of financial assets and financial liabilities, is as follows:

2008	2008
	Weighted average effective interest rate	Floating interest rate	Non-interest bearing	Total
Financial assets: Cash and cash equivalents 7.9% Receivables - Total financial assets Financial liabilities: Payables - Total financial liabilities Net financial assets		6,539,055 - 6,539,055 - 469,263 469,263
		6,539,055 469,263 7,008,318
		- 514,818 514,818
		- 514,818 514,818
		6,539,055 (45,555) 6,493,500

2007
	Weighted average effective interest rate	Floating interest rate	Non-interest bearing	Total
Financial assets: Cash and cash equivalents 6.5 Receivables - Total financial assets Financial liabilities: Payables - Total financial liabilities Net financial assets		12,041,138 - 12,041,138 - 425,740 425,740
		12,041,138 425,740 12,466,878
		- 208,654 208,654
		- 208,654 208,654
		12,041,138 217,086 12,258,224

EROMANGA URANIUM LIMITED ACN 119 031 864

noteS to the Financial StateMentS continueD

NOTE 26. FINANCIAL INSTRUMENTS continued

ii) Net fair values

The company’s financial assets and liabilities are included in the balance sheet at amounts that approximate net fair value.

iii) Sensitivity analysis

Interest rate risk

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

Interest rate sensitivity analysis

At 30 June 2008, the effect on profit and equity as a result of changes in the interest rate, with all other variables remaining constant would be as follows:

	Consolidated Group	Consolidated Group	Parent Entity	Parent Entity
	2008 $	2007 $	2008 $	2007 $
Change in profit Increase in interest rate by 2% 130,781 240,822 130,781 240,822 Decrease in interest rate by 2% (130,781) (240,822) (130,781) (240,822) Change in equity Increase in interest rate by 2% 130,781 240,822 130,781 240,822 Decrease in interest rate by 2% (130,781) (240,822) (130,781) (240,822)

NOTE 27. NEW ACCOUNTING STANDARDS AND INTERPRETATIONS

The following Australian Accounting Standards have been issued or amended and are applicable to the parent and consolidated group but are not yet effective. They have not been adopted in the preparation of the financial statements at reporting date.

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AASB Amendment Standards Affected Outline of Amendment Application Application
Date of Date for Group
Standard
AASB 2007–3 AASB 6 Exploration for and The disclosure requirements of AASB 114: Segment
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AASB Amendment AASB 2007–3	Stan AASB 6	dards Affected Exploration for and	Outline of Amendment The disclosure requirements of AASB 114: Segment	Application Date of Standard	Application Date for Group
Amendments to		Evaluation of Mineral	Reporting have been replaced due to the issuing of
Australian Accounting	AASB 107	Cash Flow Statements	AASB 8: Operating Segments in February 2007. These
Standards	AASB 119 AASB 127 AASB 134	Employee Benefits Consolidated and Separate Financial Statements Interim Financial	amendments will involve changes to segment reporting disclosures within the financial report. However, it is anticipated there will be no direct impact on recognition and measurement criteria amounts included in the financial report	1.1.2009	1.7.2009
		Reporting
	AASB 136	Impairment of Assets
AASB 8 Operating	AASB 114	Segment Reporting	As above	1.1.2009	1.7.2009
Segments
AASB 2007–6	AASB 101	Presentation of Financial	The revised AASB 123: Borrowing Costs issued in June
Amendments to		Statements	2007 has removed the option to expense all borrowing
Australian Accounting	AASB 107	Cash Flow Statements	costs. This amendment will require the capitalisation
Standards	AASB 116	Property, Plant and Equipment	of all borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset. However, there will be no direct impact to the	1.1.2009	1.1.2009
			amounts included in the financial group as they already
			capitalise borrowingcosts related toqualifyingassets.
AASB 2007–8	AASB 101	Presentation of Financial	The revised AASB 101: Presentation of Financial	1.1.2009	1.7.2009
Amendments to		Statements	Statements issued in September 2007 requires the
Australian Accounting			presentation of a statement of comprehensive income.
Standards
AASB 101	AASB 101	Presentation of Financial	As above	1.1.2009	1.7.2009
		Statements

NOTE 28. COMPANY DETAILS

The principal place of business and registered office is:

Eromanga Uranium Limited 62 Beulah Road

Norwood South Australia 5067

EROMANGA URANIUM LIMITED ACN 119 031 864

DiRectoRS DeclaRation

The directors of the company declare that :

1 the financial statements and notes, as set out on pages 28 to 44 are in accordance with the Corporation Act 2001 and:
a comply with Accounting Standards and the Corporations Regulations 2001; and
b give a true and fair view of the financial position as at 30 June 2008 and of the performance for the year ended on that date of the company and consolidated group;
2 the Managing Director and Chief Finance Officer have each declared that:
a the financial records of the company for the financial year have been properly maintained in accordance with section 286 of the Corporations Act 2001;
b the financial statements and notes for the financial year comply with the Accounting Standards; and
c the financial statements and notes for the financial year give a true and fair view;
3 in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

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

Robert M Kennedy Director

Dated this 24th day of September 2008

EROMANGA URANIUM LIMITED ACN 119 031 864

inDepenDent auDit RepoRt

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Grant Thornton South Australian
Partnership
ABN 27 244 906 724
Level 1,
67 Greenhill Rd
Wayville SA 5034
GPO Box 1270
Adelaide SA 5001
DX 275 Adelaide
T 61 8 8372 6666
F 61 8 8372 6677
E [email protected]
W www.grantthornton.com.au
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EROMANGA URANIUM LIMITED ACN 119 031 864

46 inDepenDent auDit RepoRt







        

 

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 

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 
   
  
 



    

EROMANGA URANIUM LIMITED ACN 119 031 864

 

  

     [] 

EROMANGA URANIUM LIMITED ACN 119 031 864

aSX aDDitional inFoRMation

Additional information required by the Australian Stock Exchange and not shown elsewhere in this report is as follows.

The information is current as of 15 October 2008.

DIsTRIBUTION Of EqUITy sEcURITIEs

Ordinary share capital

Fully paid ordinary shares are held by 2,285 individual shareholders. All issued ordinary shares carry one vote per share.

Restricted securities

There are 62,187,143 shares and 26,535,714 options held in escrow until 31 October 2008.

Options

Options are held by 26 individual option holders.

The number of shareholders, by size of holding, in each class are:

==> picture [212 x 28] intentionally omitted <==

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

Fully paid Options
ordinary shares
----- End of picture text -----

1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and over Holdings of less than a marketable parcel	35 - 313 1 827 1 1,017 12 93 12
	2,285 26
	1,188 -

sUBsTANTIAL sHAREHOLDERs

Fully paid ordinary shares	Number	%
Maximus Resources Limited 44,357,143 35.36

TwENTy LARGEsT sHAREHOLDERs

==> picture [256 x 20] intentionally omitted <==

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

Fully paid ordinary shares Number %
----- End of picture text -----

1 Maximus Resources Limited 2 Senil Pty Ltd 3 Chaffey Consulting Pty Ltd 4 Triple Eight Gold Pty Ltd 5 Mr Kevin John Anson Wills 6 Mr Gary Eric Maddocks + Mrs Paula Maddocks 7 ANZ Nominees Limited 8 Mr Michael Dilettoso + Mr Vincent Dilettoso 9 Merrill Lynch (Australia) Nominees Pty Limited 10 Mrs Yan Zhang 11 Austpec Pty Ltd 12 Mr Michael Nicholas Lucas 13 Mr Edward Sarnicki 14 Mittenwald Nominees Pty Ltd 15 Hobbs Management Pty Ltd 16 Copulos Superannuation Pty Ltd 17 FGC Developments Pty Ltd 18 Mr Henry Szalacki 19 Citicorp Nominees Pty Limited 20 Scott Raymond Sheard	44,357,143 35.36 4,475,001 3.57 3,736,000 2.98 3,506,000 2.79 3,500,000 2.79 2,625,000 2.09 2,470,453 1.97 1,000,000 0.80 705,000 0.56 632,000 0.50 468,158 0.37 457,500 0.36 440,000 0.35 404,500 0.32 400,301 0.32 400,000 0.32 400,000 0.32 400,000 0.32 389,082 0.31 353,333 0.28
	71,119,471 56.68

1
Maximus Resources Limited
2
Senil Pty Ltd
3
Chaffey Consulting Pty Ltd
4
Triple Eight Gold Pty Ltd
5
Mr Kevin John Anson Wills
6
Mr Gary Eric Maddocks + Mrs Paula Maddocks
7
ANZ Nominees Limited
8
Mr Michael Dilettoso + Mr Vincent Dilettoso
9
Merrill Lynch (Australia) Nominees Pty Limited
10
Mrs Yan Zhang
11
Austpec Pty Ltd
12
Mr Michael Nicholas Lucas
13
Mr Edward Sarnicki
14
Mittenwald Nominees Pty Ltd
15
Hobbs Management Pty Ltd
16
Copulos Superannuation Pty Ltd
17
FGC Developments Pty Ltd
18
Mr Henry Szalacki
19
Citicorp Nominees Pty Limited
20
Scott Raymond Sheard

44,357,143
35.36
4,475,001
3.57
3,736,000
2.98
3,506,000
2.79
3,500,000
2.79
2,625,000
2.09
2,470,453
1.97
1,000,000
0.80
705,000
0.56
632,000
0.50
468,158
0.37
457,500
0.36
440,000
0.35
404,500
0.32
400,301
0.32
400,000
0.32
400,000
0.32
400,000
0.32
389,082
0.31
353,333
0.28

71,119,471
56.68

TwENTy LARGEsT OpTIONHOLDERs

	Options	Number	%
1 Maximus Resources Limited 2 Senil Pty Ltd 3 Chaffey Consulting Pty Ltd 4 Triple Eight Gold Pty Ltd 5 K J A Wills 6 G E & P Maddocks 7 Nick Smart 8 Adelaide Equity Partners 9 R W C Willson 10 Rod Evans 11 Steve Hogan 12 Chris Johnson 13 Warwick Newton 14 Stephen Abbott 15 David Wilson 16 Ray Young 17 Daniel Woolford 18 Andrew Bonner 19 Owen Smith 20 Joanne Conner		8,035,714 28.77 4,375,000 15.66 3,500,000 12.53 3,500,000 12.53 3,500,000 12.53 2,625,000 9.40 500,000 1.79 500,000 1.79 382,000 1.37 275,000 0.98 240,000 0.86 70,000 0.25 57,000 0.20 50,000 0.18 50,000 0.18 43,000 0.15 40,000 0.14 36,000 0.13 32,000 0.11 30,000 0.11
		27,840,714 99.68

AI assistant

DREADNOUGHT RESOURCES LTD — Annual Report 2008

64785_rns_2008-10-23_c6958691-f00a-4853-953e-0c1fc0a242a5.pdf

CONTENTs

asX coDe - ero

CORPORATE DiRECTORy

Directors

company secretary

registereD anD principal office

auDitor

Banker

WeBsite

HIGHLIGHTS

Dear Fellow Shareholders

PROJECT REVIEWS

IRON OXIDE, COPPER, GOLD, URANIUM (IOCGU)

WELbOURN HILL

NICHOLSON PROjECt

(Eromanga Uranium 100% in EL 4019)

tODMORDEN PROjECt

(Eromanga earning 80% in EL 4001 from InterMet Resources)

SANDStONE-HOStED URANIUM

AbMINGA PROjECt

bILLA KALINA

MARREE PROjECt

KINGOONyA PROjECt

NEW PROjECtS

SUPLEjACK PROjECt

16 TENEMENT LOCATIONS

Financial RepoRt

INDEX

coRpoRate GoVeRnance StateMent

PrinciPle 1 – lay solid foundations for management and oversight

Recommendation 1.1 – Recommendation followed

Recommendation 1.2 – Recommendation followed

Recommendation 1.3 – Recommendation followed

PrinciPle 2 – structure the board to add value

Recommendation 2.1 – Recommendation followed

Recommendation 2.2 – Recommendation followed

Recommendation 2.3 – Recommendation followed

Recommendation 2.4 – Recommendation not followed

Recommendation 2.5 – Recommendation not followed

Recommendation 2.6 – Recommendation followed

PrinciPle 3 – comPanies should actively Promote ethical and resPonsible decision making

Recommendation 3.1 – Recommendation not followed

Recommendation 3.2 – Recommendation followed

Recommendation 3.3 – Recommendation followed

PrinciPle 4 – safeguard integrity in financial rePorting

Recommendation 4.1 – Recommendation followed

Recommendation 4.2 – Recommendation not followed

Recommendation 4.3 – Recommendation not followed

Recommendation 4.4 – Recommendation followed

PrinciPle 5 – make timely and balanced disclosure Recommendation 5.1 and 5.2 – Recommendations not followed

PrinciPle 6 – resPect the rights of shareholders

Recommendation 6.1 and 6.2 – Recommendations not followed

PrinciPle 7 – recognise and manage risk

Recommendation 7.1, 7.2 and 7.4 – Recommendations not followed

Recommendation 7.3 – Recommendation followed

PrinciPle 8 – remunerate fairly and resPonsibly Recommendation 8.1 – Recommendation not followed

Recommendation 8.2 and 8.3 – Recommendations followed

DiRectoRS RepoRt

DIREcTORs

cOMpANy sEcRETARy

pRINcIpAL AcTIvITIEs

OpERATING REsULTs

DIvIDENDs

REvIEw Of OpERATIONs

fINANcIAL pOsITION

sIGNIfIcANT cHANGEs IN sTATE Of AffAIRs

AfTER BALANcE DATE EvENTs

fUTURE DEvELOpMENTs, pROspEcTs AND BUsINEss sTRATEGIEs

ENvIRONMENTAL IssUEs

INfORMATION ON DIREcTORs

Robert Michael Kennedy

Kevin James Lines

Kevin John Anson wills

Non-Executive Director - ARSM, PhD, FAusIMM

Ewan John vickery

Non-Executive Director – L.LB

Adam Bannister

DREADNOUGHT RESOURCES LTD Annual Report 2008