IONDRIVE LIMITED — Capital/Financing Update 2006

Nov 27, 2006

28^h November 2006

\$14 MILLION PROPOSAL TO LIST URANIUM SUBSIDIARY SOUTHERN URANIUM LIMITED

Southern Gold Limited (ASX: SAU) has elected to proceed with an Initial Public Offer (IPO) to list its 100% owned subsidiary Southern Uranium Limited on the Australian Stock Exchange early in 2007

Southern Gold intends to retain a significant (approximately 40%) interest in Southern Uranium Limited following the public listing which is proposed to raise up to \$14 million.

Southern Gold shareholders shall have a priority opportunity to invest in Southern Uranium Limited.

The extensive portfolio of palaeochannel and IOCGU uranium exploration projects in the Gawler Craton of South Australia will be listed as a separate public entity to allow investors the opportunity to participate in a dedicated uranium exploration enterprise.

Details of appointments to the board of Southern Uranium Limited shall be released shortly. however Mr. John Anderson has accepted the offer of the position of Managing Director.

John Anderson is a Brisbane-based geologist and exploration manager of 28 years experience with Aberfovle and MIM, most recently as General Manager - Exploration Australia for MIM Exploration Pty Ltd.

John has explored in all Australian jurisdictions and for most commodities with an emphasis on the major base metal/gold mining centres of the Proterozoic including Broken Hill, Mount Isa/Ernest Henry and the Gawler Craton.

John led teams in the discoveries of the Angas zinc resource, the major portion of the Menninnie Dam zinc deposit, the White Dam gold copper deposit and several mineral sands deposits in the Murray Basin. He is former President of the South Australian Chamber of Mines and Energy. John is currently Non-Executive Director with Southern Gold Limited.

For Further information please contact:

Ric Horn Chairman Southern Gold Limited Phone: +61 (0) 8 8132 0044 Fax: +61 (0) 8 8132 0199

Please visit our updated website at www.southerngold.com.au

Southern Gold Limited ABN 30 107 424 519

58 North Terrace Kent Town South Australia 5067

PO Box 750 Kent Town South Australia 5071 email: info@southerngold.com.au telephone 08 8132 0044 www:southerngold.com.au

facsimilie 08 8132 0199