DREADNOUGHT RESOURCES LTD — Investor Presentation 2010

Nov 4, 2010

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An Exploration Company with Emerging Development Opportunity

Shane Gale Director – South East Energy Ltd Neville Alley Director – South East Energy Ltd

Slide 1

Presentation oN tes

DISCLAIMER This presentation contains forward looking statements that are subject to risk factors associated with the exploration and mining industry. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a variety of variables which could cause actual results or trends to differ materially.

COMPETENT PERSON

The following statements apply in respect of the information in this report that relates to Exploration Results, Exploration Targets and Mineral Resources: The information is based on, and accurately reflects i n orma f ti on rev ewe i d b y M r y e awyer, w Ll l S h o s a i M em b er o f A us ra t li an ns I tit u e o t f G eosc en i ti s s. t

Mr Sawyer is a geologist employed by Geos Mining, whom are independent consultants to South East Energy Limited. He has the relevant experience in relation to the uranium and lithium mineralisation being reported on to qualify as a Competent Person as defined in the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Identified Mineral Resources and Ore Reserves. Mr Sawyer has consented in writing to the inclusion in this report of the matters based on the information in the form and context in which it appears.

EXPLORATION TARGETS

Exploration Targets are reported according to Clause 18 of the JORC Code. This means that the potential quantity and grade is conceptual in nature and that considerable further exploration is necessary before any identified Mineral Resource can be reported. It is uncertain if further exploration will lead to a larger, smaller or any Mineral Resource.

Slide 2

ERO Mining Limited and South East Energy Limited

 South East Energy Limited (“South East”) is an unlisted South Australian mineral explorer formed in 2007, that has compiled a package of highly prospective exp oral tion acreage at Lake Frome, Lake Torrens and via its Padthaway projects in the South East of South Australia

• ERO Mining Limited (“ERO” or the “Company”) to acquire 100% of the issued capital of South East

 Creation of a significant lithium, uranium and gold company with active exploration and future development opportunities providing potential pathways to production

Slide 3

Transaction verv ewO i

 ERO to acquire 100% of the issued capital of South East for the issue of 152,325,014 ordinary shares and 191,250,000 options in the Company

• ERO to acquire 2 ELAs (proposal to grant) & 10 ELs covering 7,012 km²

• World class lithium exploration target at Lake Frome

• ERO focus lithium exp oral tion, secondary ocus - uran um f i and gold

• ERO will undertake a rev ew oi f all ts and di f pro ecj spose o

• any non core assets

Slide 4

New apC ital Structure

As consideration for the acquisition of South East, ERO will issue:  4.5 new ERO shares for every existing South East share; and  4.5 new ERO options exercisable at 5 cents each on or before 31 October 2011 for every existing South East option

	4.5 new ERO options exercisable at 5 cents each on or before 31 October 2011 for every existing South East option	4.5 new ERO options exercisable at 5 cents each on or before 31 October 2011 for every existing South East option	4.5 new ERO options exercisable at 5 cents each on or before 31 October 2011 for every existing South East option
	Capital Structure Number of Shares Number of Options ExistingCapital Structure 160,175,576 28,870,880
	Capital Structure	Number of Shares	Number of Options
	ExistingCapital Structure	160,175,576	28,870,880
	Sh d O ti I d t S th E t ares an p ons ssue o ou as	152 325 014 , ,	191 250 000 , ,
	Post Transaction Total	312,500,590	220,120,880

Slide 5

ERO Sh P i G h are r ce rap

Announcement of South East cqu s t onA i i i

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7
6 . 5
6
5.5
5
4.5
Cents per Share
4
3.5 Day High
3
2.5 Day Close
2
1.5
1
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 Post transaction market cap of approx $15.9M[1]

1 Based on ERO share price of 5.1 cents at close of trade on 13 Oct 2010

Slide 6

New Highly xper enceE i d Board

The successful completion of the transaction will result in a new highly qualified Board and management team with extensive top management experience in Australian companies and specific expertise in uranium, exploration, o p erations, business g rowth and p olitical arenas  Mr Robert Kennedy – Non-Executive Chairman  Mr Shane a eG l – CEO  Dr Neville Alley – Executive Director  Mr Hector Gordon – Non-Executive Director

Slide 7

The ew N ERO

Focused on exploration and resource development throughout Australia

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Slide 8

Why Lithium ?

Total Lithium Carbonate Demand

Average annual prices for lithium carbonate

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Tonnes
300,000
250,000
200,000
150,000
100,000
50,000
02 04 06 08 10 12 14 16 18 20
YEAR
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Source: TRU Group – Lithium Supply and Markets Conference, Chile Source: Roskill - The lithium market: 2009 review and outlook

Slide 9

Why Lithium ?

 The most economical and significant method is by evaporation processes of lithium containing brines

• Sediments have been formed over millions of years in highland bowls or depositional sinks, after rivers and hot springs washed over lithium-laden rocks and leached the mineral from them

 Producers drill wells and pump the brine into evaporation ponds

 With the removal of water, the lithium content in the brine increases to a level where it can be collected and shipped to a chemical plant for processing

ESTIMATED COSTS EX-LABOR, LITHIUM PRODUCTION FROM VARIOUS SOURCES (BYRON CAPITAL MARKETS)

	Type	Brine(Mg:Li of 1:1)	Spodumene	Clay
	Variable Cost(tonne LCE)	$1,200	$3,120	$2,262
	Fully amortized Cost - (tonne LCE)	$2 267 ,	$6 453 ,	$3 262 ,

Slide 10

Why SA Salt Lakes for Lithium?

• M d tres a or epocenj

• • Large salt lakes with brines

• ular inflow from

• Reg adjacent uplands

• Source of lithium

• • Low rainfall, high evaporation

• • Right geology underlying lakes

• Right palaeoclimatic history

• Previous exploration results

• Close to infrastructure

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Lake
Lake
Frome
Torrens
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SEZ Tenements

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Lake Torrens ELs Lithium and uranium potential

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Lake Frome ELAs Our core lithium project with high uranium potential

P a dth away EL s Uranium and HMS potential

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Slide 12

? Why is Lake Frome our Key Project

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Favourable levels of Li are present

	Depth (Metres)	CF1 (ppm)	CF2 (ppm)
	10	100	250
	20	100	30
	30	150	100
	40	150	200
	50	150	100
	60	100	250
	70		250
	80		200
	Comalco Drillholes CF3 to CF9 showed 10 to 70 ppm.

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What is the Source of the Lithium?

Rock sources: granites, volcanics and pegmatites in the adjacent ranges. Erosion during the geological past has transported lithium and uranium into Lake Frome lowland.

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Radiometric image shows likely pathway for lithium and uranium

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300-800 ppm Li
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Target Horizons

Lake Frome a depositional sink (everything ends up here).

Formations are thickened under Lake Frome

Priority 1: Namba Formation and younger horizons. Priority 2: Eyre Formation.

Pr ori ity : 3 Older sediments.

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Slide 15

Our Immediate Exploration Plans

on our Proposed exploration program focusing priority Lake Frome project.

• Fi rs t quar t er 2011 • Landholder access discussions and presentations to the wider community;

• .

• Aboriginal heritage clearance for drillhole program near CF 1 and CF 2

Second and third quarters 2011

• Drill fully cored reference holes to base of the Eyre Formation at CF 1 and CF 2, commencing onshore near drillhole CF1 where access is easier, to test chemistry of all brines and sediments and flow volumes;

• -

• Twenty five close spaced drillholes (500 m spacing) and four one kilometre spaced drillholes to test sediments, local, shallow and deeper brines for lithium and associated chemicals and flow rates;

• Test for uranium concurrently.

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Proposed drillholes Lake Frome

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Previous drillholes

Proposed fully cored holes to 150 m depth. Proposed 25X 500 m-spaced drillholes and 4X1 - km . spaced drillholes

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Lake Frome Objectives

1. Focus on near surface resources of south-western Lake Frome and explore for potential development of those first

2. Predictions of economic outcomes on processing routes contingent on lithium and brine probable reserves

3. Follow the same assessment approach as for South American Salars (Atacama or Hombre Muerto) modified for different chemistry and geology

4. Br nes are pumpei d to evaporation ponds (10 000 t, pa LCE ponds ~$75m), and precipitate lithium concentration to approx 5% to 10% and is then further processed to lithium carbonate

5. 10,000 tonne lithium carbonate equivalent per annum production (10,000 tpa LCE Processing Plant ~$160m > overseas?)

Slide 18

Developing a Lithium from Brine Pro ect j

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10 , 000T LCE f or 10 Y ears = 100 , 000 t LCE R esource
1.Exploration Results
MINERAL RESOURCES ORE RESERVES
4.Probable
2.Indicated
Lithium Evaporation
Pilot Brine
P on d s
Ponds
Concentrate
LCE
3.Measured
5. Proved
Assessments
$ cost to convert
Modelling
Resources into
Reserves
Modifying Factors > Chemistry, Brine Flow, Extraction, Precipitation, Sustainability
nfidence
o
dge and c
e
l of knowl
e
easing lev
Incr
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Slide 19

S ummary

 Acquisition of South East

 Sale of Georgetown

 Exploration program Lake Frome

 Review all tenements to retain the best

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S ummary

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Looking west from the south eastern shore west across Lake Frome salt pan and mud flat (Image CSIRO)

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S ummary

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Aerial view of brine evaporation ponds (Chile - Salar de Atacama)

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S ummary

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SQM production acf ilities

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ASX Issuer Code: ERO Internet Address: http://www.erom n ng.comi i Registered Office Address: 62 Beulah Road, Norwood, SA, 5067 Head Office Telephone: (08) 8132 7970 Fax (08) 8132 7999 Share Registry: Computershare Investor services Pty Limited, Level 5, 115 Grenfell Street, Adelaide, SA, 5000 Share Registry Telephone: 1300 787 272

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