FORTUNA METALS LTD — Capital/Financing Update 2007

Oct 2, 2007

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ADDRESS PHONE EMAIL PO Box 7996 +61 (07) 5592 2274 info@frontierresources.com.au Gold Coast Mail Centre FAX WEBSITE Qld 9726 Australia +61 (07) 5592 2275 www.frontierresources.com.au

ABN 96 095 684 389

3rd October 2007

ASX Limited Company Announcements Office

Announcement

AMENDED EXPLORATION UPDATE (NOTES ON COPPER EQUIVALENT AMENDED)

This announcement has been re-released at the request of ASX Limited to amend the copper equivalent calculation originally shown on page 4. This information is now shown in full under the Notes section on page 6 of this release.

Yours faithfully

FRONTIER RESOURCES LTD

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P.A.McNeil, M.Sc. MANAGING DIRECTOR

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ADDRESS PHONE EMAIL PO Box 7996 +61 (07) 5592 2274 info@frontierresources.com.au Gold Coast Mail Centre FAX WEBSITE Qld 9726 Australia +61 (07) 5592 2275 www.frontierresources.com.au

ABN 96 095 684 389

3rd October 2007

ASX Limited Company Announcements Office

Announcement

AMENDED EXPLORATION UPDATE

• Kodu Deposit (Mt Bini - EL1348, PNG)

• The Conceptual Mining Study (CMS) is proceeding smoothly; the site evaluation has been completed, a new radar based digital elevation model flown and more than a tonne of various representative samples are undergoing metallurgical and optimisation testwork at Amdel Laboratories in Perth, WA.

Swain Associates Pty Ltd commenced the study a month ago, after completing a CMS for Marengo Mining on their Yandera Deposit in PNG. Mr. Swain brings substantial porphyry copper–gold Mining Engineering experience from Bougainville and other mines. It is anticipated that the CMS on the Kodu Deposit will be completed and announced in early November.

• The Indicated and Inferred Resource estimation (being undertaken by Geostat Services Pty Ltd) is progressing well, with the geological model and physical parameters better constrained than previously. It is expected that the resource estimation will be completed and reported mid to later October.

It is anticipated that a significant amount of the present Inferred Resource will be converted to Indicated status, as determined by variography (the analysis of the statistical attributes relating to the mineralisation, its location and consistency etc).

The global tonnage at Kodu is not likely to be significantly increased by this estimation iteration because the margins of the orebody have been smoothed out resulting in some tonnage loss and several of the additional holes included this time were just not significantly mineralised. In addition, the interpolation/extrapolation methodology generally utilised in resource estimations had already accounted for tonnage from the remaining holes (i.e. the few holes not previously included in the Inferred Resources had tonnage and grade previously already interpolated for them due to their location within or outside the orebody). Hole KFD014 should, however, add additional tonnage to the deposit at depth, due to the change in dip of the mineralisation to the east.

• Komsen Prospect (Andewa - EL1345, PNG)

• Assay results for holes 1 and 2 are expected to be reported early next week.

• Ten diamond core holes (total of 965.8m) have been drilled to intersect the main vein at increasing depths downhole. The holes were drilled on 3 fences from the one pad at various inclinations (see Figures 1 and 2, plus Table 1).

• Hole AFD011 is planned to assess the depth potential of this gold system, by targeting the depth extension to the surface trench result that graded 8m of 11.7 g/t gold. The mineralised structure is expected to be intersected at a depth of about 250m vertically below the collars of the existing holes, either proving or disproving

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significant vertical mineralised extent and associated tonnage potential. Drilling will commence mid next week following an onerous, totally ‘manual’ rig shift.

• A ground magnetic survey was commenced to assist in defining the location and extent of the mineralised structures.

• A Company owned bulldozer will be barged to a nearby coastal site mid next week to commence cutting access to the prospect, then likely undertake a trenching program to better evaluate the regions’ ultimate gold mineralisation potential.

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Figure 1 is a cross section at the Komsen Prospect (EL 1345), showing the traces of recently completed holes AFD001 –AFD005 in the subsurface, with visually altered and mineralised intervals (observed in core) highlighted in pink. This mineralised structure shows very good vertical continuity and consistency, to a currently known vertical depth of about 130m. It also highlights that there are many other nearby structures /veins to be assessed.

Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect	Table 1. Maximum Mineralised Intersections in Drill Hole - Komsen Prospect
Hole ID	From	To	Apparent Width	True Width	Azimuth	Incl.	EOH Depth	Easting	Northing	RL
AFD001	21.3	24.5	3.2	3.1	14	-45	198.0	713543.5	9383647	374m
AFD002	34.6	40.1	5.5	3.4	14	-55	55.6	713543.5	9383647	374m
AFD003	60.2	67.8	7.6	2.8	14	-65	81.2	713543.5	9383647	374m
AFD004	76.8	84.3	7.5	2.8	14	-70	97.8	713543.5	9383647	374m
AFD005*	111.3	129.0	17.7	5.8	14	-75	153.4	713543.5	9383647	374m
AFD006	26.1	34.8	8.7	4.5	60	-45	56.9	713543.5	9383647	374m
AFD007	31.4	40.3	8.9	3.6	60	-55	49.5	713543.5	9383647	374m
AFD008	67.2	74.9	7.7	2.2	60	-65	82.4	713543.5	9383647	374m
AFD009	48.6	65.0	16.4	8.5	328	-45	82.3	713543.5	9383647	374m
AFD010*	96.0	105.0	9.0	3.4	328	-55	108.7	713543.5	9383647	374m
	Total Andewa Drilling to Date =				965.8 m

NB: AFD005 and AFD010 intersections are in 2 closely separated intervals

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Figure 2. Plan of part of the Komsen Prospect showing surface traces of holes drilled to date, the approximate true width of hand trenched gold mineralised intervals and their locations and the traces of /spatial relationships between the gold mineralised structures.

A series of photos are appended to show interested shareholders (who have enquired) various aspects of the Andewa area, exploration camp and drilling operation.

� Elo Prospect (Mt Bini - EL1348, PNG)

• Assay results from hole 2 are expected to be returned / announced in 2 to 3 weeks.

• Access track cutting to Elo (by a Company owned bulldozer) is proceeding smoothly along a major ridgeline, with approx. 9km of logging tracks cleaned up, approx. 2 km of new cutting completed and approx. 7km of track cutting remaining. This will enable a cost effective rig shift, plus exploration and trenching of the large gold in soil anomaly on the south slope of Elo Hill.

• An additional long hole is contemplated to test deeper in the core of the system for potentially economic grades and widths of copper –gold- molybdenum mineralisation. This could commence in about a month, after completion of track access to the site.

• Narrawa, Stormont and Wart Hill Prospects (RL3/2006, RL4/2006 and EL 20/96, Tasmania)

• Geostat and Frontier have commenced data compilation and the physical parameter testwork required to complete resource estimations for each of the above prospects. This work is anticipated to be completed by the end of the year.

• Narrawa/Higgs contains gold-silver-zinc-lead mineralisation, Stormont contains goldbismuth mineralisation (both are skarn related and a few kilometres apart) and Wart Hill contains zinc-lead-silver-gold mineralisation (massive sulphides in the Tasmania’s Mount Read Volcanics). Each deposit is relatively small but all have good continuing exploration and possible development potential, as they all occur from surface.

• Encouraging results from the resource estimations would likely see the commencement of a Conceptual Mining Study on Narrawa and Stormont, to evaluate

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possible development opportunities and costs, including centrally located/shared processing facilities or toll milling.

• Planning is well advanced for the proposed exploration program to define additional drilling targets at the NE Osmund Prospect (airborne electromagnetic anomaly) in the SMRV Project. Drilling is planned to commence at the Wart Hill Prospect in early/mid January 2008.

For additional information relating to the Company and its projects please visit our website at www.frontierresources.com.au or feel free call me on +61 (0) 8 9295 0388.

FRONTIER RESOURCES LTD

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P.A.McNeil, M.Sc. MANAGING DIRECTOR

The information in this report that relates to Exploration Results or Mineral Resources is based on information compiled by, or compiled under the supervision of Peter A. McNeil - Member of the Aust. Inst. of Geoscientists and Robert D. McNeil - Fellow of the Aust I.M.M. Peter McNeil and Robert McNeil are Managing Director and Chairman of Frontier Resources, respectively and neither is a full time employee of Frontier. Peter McNeil and Robert McNeil, have collectively sufficient experience which is relevant to the type of mineralisation and type of deposit under consideration to qualify as Competent Person as defined in the 2004 Edition of the Australasian Code of Reporting Exploration Results, Mineral Resources and Ore Reserves. Peter McNeil and Robert McNeil consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.

About Frontier Resources

• Frontier is focused on exploring the highly mineralised Pacific ‘Rim of Fire’, Papua New Guinea and the major Kodu copper – gold – molybdenum Deposit. The Company is also exploring the Andewa gold Project, Elo and Bukuam porphyries, plus the SMRV zinc - lead – silver - gold Project in Tasmania.

• Frontier’s objective is to advance the Kodu Deposit rapidly and cost effectively. A Conceptual Mining Study (CMS) is being undertaken to evaluate various parameters associated with possible development paths forward for the deposit and its further exploration.

• The Company has a 100% interest in 3 Exploration Licences (Kodu, Likuruanga and Andewa) covering approx. 804 km[2] of quality copper and gold properties in PNG and 5 Exploration Licences + 2 Retention Licences covering 211 km[2] in Tasmania.

• The portfolio offers excellent mineral deposit potential. Primary targets are World Class copper-goldmolybdenum porphyry, gold/silver epithermal and polymetallic (zinc/lead/silver/gold) VHMS deposits.

• The projects all have high-grade exploration results in rock, trenches and/or drill hole and are in the same or similar geological terranes as existing World Class and/or major mines.

• The global Inferred Resource at the Kodu Deposit contains 945,000 tonnes of copper equivalent* grading 0.47%, within 203 million tonnes grading 0.28% copper + 0.32g/t gold + 73ppm molybdenum + 1.8g/t silver. It contains 570,000 tonnes of copper, 65 tonnes of gold, 15,000 tonnes of molybdenum and 365 tonnes of silver (or 1.25 billion pounds of copper, 2.1 million ounces of gold, 33 million pounds molybdenum and 12 million ounces of silver).

• A higher grade core appears to run the length of the deposit and could provide the basis for a ‘Starter Pit’. The CMS and additional drilling will clarify this.

• Frontier’s Directors /management have more than 200 years combined experience in PNG & Australia.

• The Company operates with a general policy of ‘DRILLING’ our quality projects using our self manufactured, cost effective, environmentally friendly, man-portable diamond core rigs.

• The Company is an ASX listed junior mineral explorer whose shares also trade on the Frankfurt, Berlin and Munich Stock Exchanges.

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Notes re *Copper Equivalent amended:

• *Copper Equivalent is the contained copper, gold, silver and molybdenum that are converted to an equal amount of pure copper and summed (based on assays of mineralised rock and actual metal prices). It is used to allow interpretation of the possible theoretical ‘value’ of mineralised rock, without consideration of the ultimate extractability any of the metals.

• Copper Equivalent is based upon metal prices of US$3.32/lb Cu, US$654/oz Au, US$32/lb Mo (57% MoO3 conc.) & US$13.20/oz Ag (12/6/2007). The formula used is Cu Equivalent % = Cu(%) + Au(g/t) x 0.28728 + Mo(ppm) x 0.00115 + Ag(g/t) x 0.00580.

• Island Arc porphyry copper– gold– molybdenum deposits such as Kodu, typically recover contained Cu, Au, Mo and Ag (subject to metallurgical characteristics and prevailing metal prices).

• The ASX requires a metallurgical recovery be specified for each metal, however, no testwork has ever been undertaken at Kodu and recoveries can only be assumed to be typical for Island Arc porphyry copper – gold – molybdenum – silver deposits.

• It is the Company’s opinion that each of the elements included in the metal equivalents calculation have a reasonable potential to be recovered if the project proceeds to mining.

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Photo 1 Mount Andewa at sunset (across the bay to the right). Photo 2 An amazing island community between Andewa and Kimbe. Photo 3 WWII Japanese Zero aircraft on the reef near Andewa. Photo 4 Komsen camp buildings. Photo 5 The well equipped Komsen office and Senior geologist Ken Igara. Photo 6 Komsen camp building and employees. Photo 7 Ken examining Komsen drill core (at the core shed). Photo 8 View looking SE towards the Komsen prospect (located at the brown spot in the central right background). Photo 9 Managing Director examining the 3m of 14.3 g/t gold outcrop, with the drill rig and rods being set up in the background on pad 1. Photo 10 Rig drilling on hole AFD003. Photo 11 Hole AFD005’s visually mineralised interval in the core tray. Photo 12 Hole AFD006 part of the mineralised interval in the core tray. Photos 13-17 Mineralisation and various textures encountered in the core at Komsen shown on cut flat surfaces. Photo 18 Cutting of drill pad 2 for hole AFD011. Photo 19 Geologist Yaeti GaeGae initiating the ground magnetic survey at the Komsen Prospect.

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