NEURIZER LTD — Interim / Quarterly Report 2010

Mar 11, 2010

Marathon Resources Limited ACN 107 531 822

Interim Financial Report 31[st] December 2009

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CONTENTS

DIRECTORS’ REPORT

DIRECTORS’ DECLARATION

AUDITOR’S INDEPENDENCE DECLARATION

FINANCIAL STATEMENTS

NOTES

AUDITOR’S STATEMENT

*** Note – Review of Operations**

Information in this Interim Financial Report relating to Exploration Results has been compiled by Mr Brenton Newell, a part-time employee of Marathon Resources Ltd and a Member of the Australian Institute of Geoscientists and Dr Phung Nguyen B.Sc (Hons), PhD (Uni.WA.), a part-time employee of Marathon and a Member of the AusIMM. The Mt Gee Mineral Resource Estimate was based on information compiled on behalf of Marathon by Tony Marshall B.Sc (Hons) Uni.Melb., a Member of the AusIMM. At time of reporting Tony Marshall was Principal Geologist with SMG Consulting and a full-time employee of that company

Each respectively have sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity which each is undertaking, to qualify as a Competent Person as defined in the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”.

Each respectively consents to the inclusion in this Report of the statements based on the information in the form and context appearing.

Category Tonnes (Mt) Grade U3O8 (ppm) TonnesU3O8 kt Indicated 4 706 2.8 Inferred 47 607 28.5 Total 51 615 31.3 # at 300 ppm U3O8 cutoff

Marathon Resources Limited ACN 107 531 822 235 Port Road Hindmarsh SA 5007 Telephone (08) 8348 3500 Facsimile (08) 8346 8111 admin@marathonresources.com.au www.marathonresources.com.au

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES DIRECTORS’ REPORT

The directors present their report on Marathon Resources Ltd for the half year ended 31[st] December 2009 and the state of the affairs of the Company at that date.

In order to comply with the provisions of the Corporations Act 2001, the directors report as follows:

Directors

Persons who have been Directors in the Company during or since the end of the half year are:

Peter Williams BEc FCA Chairman Appointed 21[st] May 2004

John G. (Shad) Linley BSc (Hons), F Aus IMM Doctorate of Philosophy (Adelaide University) Director (Chief Executive Officer) Appointed 30[th] June 2008

Chen Zeng BA (Economics), Masters Degree in International Finance Shanghai University of Finance & Economics Director (Non-executive) Appointed 27[th] December 2006

Christopher Schacht Director (Non-executive) Appointed 23[rd] January 2008

Secretary

Stuart Appleyard LLB Appointed 28[th] January 2004

Review of Operations

It is well documented and shareholders are aware that the Mt Gee deposit is the fifth-largest, undeveloped uranium resource in Australia.

Mineralisation at the Mt Gee deposit is open in three directions, so the ultimate resource should be larger than the current estimate of 69,000,000 lbs of U3O8. High grade uranium has also been intersected by limited drilling to date at the neighbouring Armchair and Hodgkinson deposits.[*ASX Release 18 December 2009 – refer Contents page]

Shareholders are also aware of the Company still not being able to continue a drilling campaign on its Northern Flinders Ranges until proposed amendment to the SA Mining Act are approved by Parliament.

The Company looks forward to resuming, by agreement with PIRSA and other stakeholders, an exploration program which will demonstrate the significant value of Marathon’s vast world class uranium resources within our Mt Gee Exploration Licence 4355 (EL4355), formerly EL 3258 prior to renewal.

The major focus of activity continues to be non-invasive programs in the Paralana Mineral System covering:

Mt Gee (EL 4355)

Which included:

• Completion of helicopter magnetic and radiometric survey over the Mt Gee tenement;

• Completion of ground gravity in-fill survey within the Mt Gee tenement; and

• Completion of stream sediment in-fill and check sampling within the Mt Gee tenement.

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES DIRECTORS’ REPORT

Review of Operations (con’t)

The recently completed radiometric survey (4,443 line kilometres) delineated 42 distinct zones of uranium mineralisation within the tenement. Follow-up geological mapping on two of these radiometric anomalies has delineated two large, high grade shear zones. In both cases, the shear structure:

• is near vertical

• is 25-50 wide

• outcrops over a strike length > 400 metres

These shear structures are significant new exploration targets and may represent the elusive ‘feeder systems’ that transported the uranium-bearing fluids.

The global financial crisis necessitated the Company taking action to protect cash reserves. Marathon continues to, where possible, take appropriate steps to reduce operating costs, including corporate administration expenses and the cost of services at the exploration site.

In the period under review Marathon relinquished two tenements:

• Deddick River EL 5086

• Little Yalmy EL 5085

A further two retained tenements were reduced in size by eliminating ground already explored:

• Coondambo EL3593

• Blanchetown EL4052

EL 4052 Blanchetown

Preliminary 500m spaced calcrete sampling was completed over a representative proportion of the retained area of the Blanchetown tenement to evaluate the possible use of geochemistry to target areas of potential strandlines as the host to economic concentrations of heavy minerals. Follow-up by selective sampling confirmed results from Phase 1.

The presence of strandlines needs to be confirmed by use of sensitive magnetic surveying using close spaced lines & stations. Areas of apparent strandlines will be surveyed on north-south oriented lines to establish sharp peaks representing accumulations of magnetic minerals, thus validating the concept of strandlines. Lack of sharp magnetic response will suggest dispersion and/or destruction of the strandlines.

Six areas were selected to survey. Each area is approximately two square kilometres and north-south oriented survey lines 25 metres apart were flown on 17[th] and 18[th] December 2009 using Daishsat Helimag system.

Results are awaited at the date of this report.

Warburton Joint Venture – Western Australia

Marathon advised on the 16[th] September 2009 that it has withdrawn from the Warburton Joint Venture covering tenements E69/1564 and E69/2177-2181 effective 31[st] August 2009. Marathon has transferred its interest in the JV tenements to its joint venture partner Strzelecki Metals Ltd (ASX STZ) for no consideration, thus ending the Warburton Joint Venture.

Kalymna Joint Venture

Marathon advised their Joint Venture partners on 24[th] October 2009 that it was withdrawing from the Kalymna Joint Venture, covering EL 4526. Marathon has transferred its interest in EL 4526 to the other partners.

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES DIRECTORS’ REPORT

MATTERS SUBSEQUENT TO END OF THE HALF YEAR

Marathon Resources formally lodged its submission to the South Australian Government’s “Seeking a Balance” draft plan on 29[th] January 2010.

The Government’s “Seeking a Balance” paper contains proposals for management policies and zones for the Northern Flinders Ranges area in South Australia, including Marathon Resources’ Mt Gee Uranium project.

Marathon Resources believes the proposed management plan for the Northern Flinders Ranges is a flawed policy document that:

• was undertaken without consultation with key stakeholders;

• relies on a questionable scientific base; and

• adds unnecessary layers of regulation and control.

Auditor’s independence

The auditor’s independence declaration is included on page 6 of this interim financial report.

Peter Williams Director

Christopher Schacht Director

Dated in Adelaide, South Australia this 11[th] day of March 2010

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Level 1, 67 Greenhill Rd Wayville SA 5034 GPO Box 1270 Adelaide SA 5001

T 61 8 8372 6666 F 61 8 8372 6677 E info@gtsa.com.au W www.grantthornton.com.au

AUDITOR’S INDEPENDENCE DECLARATION TO THE DIRECTORS OF MARATHON RESOURCES LIMITED

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the review of Marathon Resources Limited for the half-year ended 31 December 2009, I declare that, to the best of my knowledge and belief, there have been:

• a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and

• b no contraventions of any applicable code of professional conduct in relation to the review.

GRANT THORNTON South Australian Partnership Chartered Accountants J L Humphrey Partner

Signed at Wayville on this 11[th] day of March 2010

Grant Thornton South Australian Partnership ABN 27 244 906 724 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, together with its subsidiaries and related entities, delivers its services independently in Australia.

Liability limited by a scheme approved under Professional Standards Legislation

MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF YEAR ENDED 31[ST] DECEMBER 2009

Notes	Consolidated Group 31 December 2009 31 December 2008
Revenue - Interest income - Other miscellaneous income Gain on sale of financial assets Depreciation expense Exploration Expenditure written off - Current period expenses - Prior period expenditure Employee benefit expenses Occupancy expense Share based payment expenses 3 Consulting expenses Travel expenses ASX listing and registry expenses Corporate administration Fair value gain/(loss) on held for trading financial assets (Loss) before income tax Income tax expense (loss) for the period after tax expense Other comprehensive income Changes in fair value of available for sale financial assets Reclassification of available for sale financial asset reserve to profit and loss upon disposal Total comprehensive income for the period Earnings per share Basic (cents per share) Diluted (cents per share)	60,499 126,275 1,186 11,173 256,027 - (71,735) (86,084) (40,732) (474,175) (650,658) (109,615) (805,958) (629,856) (81,368) (83,358) (696,000) - (135,424) (277,158) (27,964) (61,356) (90,441) (75,849) (339,139) (376,253) 46,000 (333,500)
	(2,575,707) (2,369,756) - (55,132)
	(2,575,707) (2,424,888)
	86,250 (263,569) 556,455 -
	642,705 (263,569)
	(1,933,002) (2,688,457)
	(3.3) (3.9) (3.3) (3.9)

The Accompanying notes form part of these financial statements

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31[ST] DECEMBER 2009

Notes	Consolidated Group 31 December 2009 30 June 2009
CURRENT ASSETS Cash and cash equivalents Trade and other receivables Financial assets Total Assets NON-CURRENT ASSETS Property, plant and equipment Exploration and evaluation expenditure Total Non-Current Assets TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Short term provisions Total Current Liabilities NET ASSETS EQUITY Issued capital Reserves Retained losses TOTAL EQUITY	3,047,688 3,839,113 62,807 401,461 276,750 564,025
	3,387,245 4,804,599
	417,604 460,358 15,784,519 15,672,445
	16,202,123 16,132,803
	19,589,368 20,937,402
	147,218 282,779 897,416 872,888
	1,044,634 1,155,667
	18,544,734 19,781,735
	36,542,424 36,542,424 2,201,148 862,443 (20,198,839) (17,623,132)
	18,544,734 19,781,735

The accompanying notes form part of these financial statements

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31[ST] DECEMBER 2009

Balance at 1 July 2009 Fair value of share option issued Total comprehensive income for the period Balance at 31 December 2009 Balance at 1 July 2008 Share Issues net of transaction costs Fair value of share option issued Total comprehensive income for the period Balance at 31 December 2008	Issued Capital Retained Losses Share Option Reserve Financial asset Reserve Total
	36,542,424 (17,623,132) 1,594,227 (731,783) 19,781,736 - - 696,000 - 696,000 - (2,575,707) - 642,705 (1,933,002)
	36,542,424 (20,198,839) 2,290,227 (89,078) 18,544,734
	31,807,520 (13,256,131) 2,832,446 (633,123) 20,750,712 4,704,125 - - - 4,704,125 - 1,236,220 (1,238,220) - - - (2,424,888) - (263,569) (2,688,457)
	36,511,645 (14,442,799) 1,594,226 (896,692) 22,766,380

The accompanying notes form part of these financial statements

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31[ST] DECEMBER 2009

Notes	Consolidated Group 31 December 2009 31 December 2008
Cash flows from operating activities Payments to suppliers and employees Interest and sundry income received Research and development tax concession received Net cash provided by / (used in) operating activities Cash flow from investing activities Proceeds on disposal of available for sale financial assets Purchase of plant and equipment Payment for exploration activities Net cash provided by / (used in) investing activities Cash flows from financing activities Proceeds from issue of shares Payment of expenses for the issue of shares Net cash provided by / (used in) financing activities Net (decrease) / increase in cash held Cash at the beginning of the half year Cash at the end of the half year	(1,568,362) (2,225,257) 61,685 137,448 302,898 -
	(1,203,779) (2,087,809)
	1,232,007 - (28,981) (12,502) (790,672) 1,819,704)
	412,354 (1,832,206)
	- 4,832,766 - (183,773)
	- 4,648,993
	(791,425) (728,978) 3,839,113 5,448,765
	3,047,688 6,177,743

The accompanying notes form part of these financial statements

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES NOTES TO THE INTERIM FINANCIAL REPORT

NOTE 1 – SUMMARY OF ACCOUNTING POLICIES

Reporting entity

Marathon Resources Limited (the “Company”) is a company domiciled in Australia. The consolidated interim financial report of the Company as at and for the six months ended 31 December 2009 comprises the Company and its subsidiaries (together referred to as the "consolidated entity" or “group”).

The consolidated annual financial report of the consolidated entity as at and for the year ended 30 June 2009 is available upon request from the Company’s registered office at 235 Port Road Hindmarsh SA, and can be viewed on the Company’s website www.marathonresources.com.au

Statement of compliance

The consolidated interim financial report is a general purpose financial report which has been prepared in accordance with AASB 134: Interim Financial Reporting and the Corporations Act 2001.

The consolidated interim financial report does not include all of the information required for a full annual financial report, and should be read in conjunction with the consolidated annual financial report as at and for the year ended 30 June 2009.

Accounting policies

The accounting policies applied by the consolidated entity in this consolidated interim financial report are the same as those applied by the consolidated entity in its consolidated financial report as at and for the year ended 30[th] June 2009, except as noted below.

Accounting standards not previously applied

The Group has adopted the following new and revised Australian Accounting Standards issued by the AASB which are mandatory to apply to the current interim period. Disclosures required by these Standards that are deemed material have been included in this financial report on the basis that they represent a significant change in information from that previously made available.

Presentation of Financial Statements

AASB 101 prescribes the contents and structure of the financial statements. Changes reflected in this financial report include:

• the replacement of Income Statement with Statement of Comprehensive Income. Items of income and expense not recognised in profit or loss are now disclosed as components of ‘other comprehensive income’. In this regard, such items are no longer reflected as equity movements in the Statement of Changes in Equity;

• the adoption of the single statement approach to the presentation of the Statement of Comprehensive Income;

• other financial statements are renamed in accordance with the Standard; and

• presentation of a third Statement of Financial Position as at the beginning of a comparative financial year where relevant amounts have been affected by a retrospective change in accounting policy or material reclassification of items.

Operating Segments

From 1 January 2009, operating segments are identified and segment information disclosed on the basis of internal reports that are regularly provided to, or reviewed by, the group’s chief operating decision maker which, for the Group, is the board of directors. In this regard, such information is provided using different measures to those used in preparing the Statement of Comprehensive Income and Statement of Financial Position. Reconciliations of such management information to the statutory information contained in the interim financial report have been included.

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES NOTES TO THE INTERIM FINANCIAL REPORT

NOTE 2 – COMPARATIVES AND NOTES

The following notes cover only events or transactions that are material to an understanding of the current interim period.

NOTE 3 – SHARE BASED PAYMENTS

The following options were granted during the period:-

• Value of Options

• • On 2 September 2009, 1,000,000 options were granted to CEO John (Shad) Linley pursuant to shareholder approval at an EGM to take up ordinary shares at an exercise price of $0.80 each. The options exercisable on or before 2 458,000 September 2012.

At balance date no options had been exercised.

The value of the option were calculated using the Black-Scholes option pricing model applying the following inputs:

• Exercise price $0.80 - Life of option 3 years - Underlying share price $0.733 - Expected share price volatility 145.3% - Risk free rate 5.13%

• On 15 December 2009, 250,000 options each were granted to 4 Directors pursuant to shareholder approval at the AGM to take up ordinary shares at an exercise price of $1.10 each. The options exercisable on or before 31 December 238,000 2014.

At balance date no options had been exercised.

The value of the option were calculated using the Black-Scholes option pricing model applying the following inputs:

• Exercise price $1.10 - Life of option 5 years - Underlying share price $0.455 - Expected share price volatility 81.80% - Risk free rate 5.21%

696,000

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES NOTES TO THE INTERIM FINANCIAL REPORT

NOTE 4 – SEGMENT INFORMATION

Identification of reportable segments

The group has identified its operating segments based on the internal reports that are reviewed and used by the board of directors (chief operating decision makers) in determining the allocation of resources.

The group is managed primarily on the basis of cost centres since each cost centre has different cash requirements. Operating segments are therefore determined on the same basis. The group’s operating segments are dividend into JORC compliant Resource tenements, other tenements, investments and corporate.

JORC compliant Resource tenements

This relates to tenements on the group which the group have ongoing exploration activities. Qualifying expenditure incurred on JORC compliant Resource tenements are capitalised.

Other tenements

This relates to tenements other than JORC Compliant Resource tenements.

Investment

This segment monitors the performance of the group’s quoted investments.

Unallocated

This relates to all other income and expenses of the group which are not directly attributed to any of the above segments.

Segment performance TENEMENTS INVESTMENT JORC COMPLIANT RESOURCE OTHER Six months ended 31st December 2009 Income - - - Depreciation (19,782) - - Exploration expenditure - (691,390) - Overheads - (57,873) - Net gain on sales of financial assets - - 256,027 Movement in fair value of financial assets - - 46,000 Net loss / (profit) before tax (19,782) (749,263) 302,027 Six months ended 31st December 2008 Income - - - Depreciation (25,136) - - Exploration expenditure (458,848) (124,942) - Overheads - (95,327) - Movement in fair value of financial assets - - (333,500) Net loss / (profit) before tax (483,984) (220,269) (333,500)	TENEMENTS INVESTMENT	UNALLOCATED TOTAL
		61,685 61,685 (51,953) (71,735) - (691,390) (2,118,421) (2,176,294) - 256,027 - 46,000
	(19,782) (749,263) 302,027	(2,108,689) (2,575,707)
		137,448 137,448 (60,948) (86,084) - (583,790) (1,408,503) (1,503,830) - (333,500)
	(483,984) (220,269) (333,500)	(1,332,003) (2,369,756)

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES NOTES TO THE INTERIM FINANCIAL REPORT

NOTE 4 – SEGMENT INFORMATION (con’t)

Segment assets and liabilities

As at 31st December 2009 Total assets As at 30 June 2009 Total assets	TENEMENTS INVESTMENTS	UNALLOCATED TOTAL
	JORC COMPLIANT RESOURCE OTHER 15,528,728 539,364 276,750	3,244,526 19,589,368
	14,744,009 1,150,362 564,025	4,479,006 20,937,402

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES NOTES TO THE INTERIM FINANCIAL REPORT

NOTE 5 – CRITICAL ACCOUNTING ESTIMATES

Provision of $ 800,000 on legal action with claim of $ 1,600,000

Proceedings have been brought against the Company by an ex employee for alleged breach of contract. The Company denies the claim and is defending the proceedings. The nature of the action is based on an all or nothing claim with a maximum exposure to the Company of $1.6 million. Marathon has separately advanced a cross claim of approximately $0.847 million. Based on legal advice the Directors believe that it is more likely than not to successfully defend the claim in its entirety. In view of the fact that the matter is complex and not without risk of an adverse outcome the Directors are of the view that a provision of 50% of the maximum exposure is still reasonable.

There have been no developments that would cause earlier assessment to be revised.

NOTE 6 – CRITICAL ACCOUNTING JUDGEMENTS

No impairment of the Mt Gee exploration asset with a carrying value of $15,273,091

During the half year significant developments have been:

• Grant of an Exploration Licence (EL4355) for 12 months to replace EL3258 covering Mt Gee;

• Lodgement of Declaration of Environment Factors (DEF) for low impact, non invasive exploration activities on EL4355;

• Identification of five priority areas from interpretation of geochemical results; and

• Geological mapping has identified high grade uranium within two shear zones.

Exploration Licence EL3258 expired on the 10[th] October 2009 at the end of the statutory five year period. PIRSA granted a Replacement Licence No EL4355 over the same area as EL3258 on 22[nd] October 2009 for a period of one year with additional conditions. These conditions include obtaining approval prior to carrying out any exploration operations from the Director of Mines and the Chief Executive of Department of Environment and Heritage (DEH). An application supported by a DEF to carry out such operations and this must be lodged with PIRSA.

In accordance with the new conditions attached to EL 4355 Marathon lodged a DEF with PIRSA on 20[th] November 2009 with a revised version on 11[th] December 2009 to obtain permission to conduct lowimpact, non-invasive exploration activities including geological mapping on foot, stream sediment sampling on foot and helicopter supported ground gravity surveying.

Having regard for the developments noted above the directors are of the opinion that there is no impairment of the Mt Gee exploration assets with a carrying value of $15,273,091.

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLED ENTITIES NOTES TO THE INTERIM FINANCIAL REPORT

NOTE 7 – ECONOMIC DEPENDENCY

The financial report has been prepared on the basis of going concern. The company will require additional capital for the continued development of its existing projects and working capital. The directors remain in consultation with the company’s advisers and are evaluating the possible means to raise the required capital. As in the past the directors anticipate the ongoing support of its major shareholders when seeking new capital.

The Company’s ability to continue as a going concern is contingent upon successfully raising additional capital. If additional funds are not raised, the going concern basis may not be appropriate, with the result that the company may have to realise its assets and extinguish its liabilities, other than in the ordinary course of business and in amounts different from those stated in the financial report. No allowance for such circumstances has been made in the financial report.

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MARATHON RESOURCES LIMITED ACN 107 531 822 AND CONTROLLING ENTITIES DIRECTORS’ REPORT

The Directors declare that:

In the opinion of the directors of the company:

1. The financial statements and notes, as set out on pages 7 to 16, are in accordance with the Corporations Act 2001 including:

2. (a) Complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001; and

3. (b) Giving a true and fair view o f the consolidated entity’s financial position as at 31 December 2009 and of its performance, as represented by the results of its operations and cash flows for the half-year ended on that date.

4. 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.

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Peter Williams Director

Christopher Schacht Director

Dated in Adelaide, South Australia this 11[th] day of March 2010

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Level 1, 67 Greenhill Rd Wayville SA 5034 GPO Box 1270 Adelaide SA 5001

T 61 8 8372 6666 F 61 8 8372 6677 E info@gtsa.com.au W www.grantthornton.com.au

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF MARATHON RESOURCES LIMITED

We have reviewed the accompanying half-year financial report of Marathon Resources Limited (“Company”), which comprises the consolidated financial statements being the statement of financial position as at 31 December 2009, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the half-year ended on that date, a statement of accounting policies, other selected explanatory notes and the directors’ declaration of the consolidated entity, comprising both the Company and the entities it controlled at the half-year’s end or from time to time during the half-year.

Directors’ responsibility for the half-year financial report

The directors of the Company are responsible for the preparation and fair presentation of the half-year financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the half-year financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibility

Our responsibility is to express a conclusion on the consolidated half-year financial report based on our review. We conducted our review in accordance with the Auditing Standard on Review Engagements ASRE 2410: Review of Interim and Other Financial Reports Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the consolidated entity’s financial position as at 31 December 2009 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Regulations 2001.

Grant Thornton South Australian Partnership ABN 27 244 906 724 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, together with its subsidiaries and related entities, delivers its services independently in Australia.

Liability limited by a scheme approved under Professional Standards Legislation

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INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF MARATHON RESOURCES LIMITED Cont

Auditor’s responsibility Cont

As the auditor of Marathon Resources Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we complied with the independence requirements of the Corporations Act 2001.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Marathon Resources Limited is not in accordance with the Corporations Act 2001, including:

• a giving a true and fair view of the consolidated entity’s financial position as at 31 December 2009 and of its performance for the half-year ended on that date; and

• b complying with Accounting Standard AASB 134: Interim Financial Reporting and Corporations Regulations 2001.

Significant uncertainty regarding:

Continuation as a going concern

Without qualifying our review conclusion attention is drawn to Note 7 – Economic Dependency to the Interim Financial Report. The financial report has been prepared on the basis of a going concern. The company will require additional capital for the continued development of its existing projects and working capital.

The Company’s ability to continue as a going concern is contingent upon successfully raising additional capital. If additional funds are not raised, the going concern basis may not be appropriate, with the result that the Company may have to realise its assets and extinguish its liabilities, other than in the ordinary course of business and in amounts different from those stated in the interim financial report. No allowance for such circumstances has been made in the financial report.

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INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF MARATHON RESOURCES LIMITED Cont

Significant uncertainty regarding: Cont

Access to Mt Gee (EL 4355)

Without qualification to the review conclusion expressed above, attention is drawn to Note 6 – Critical Accounting Judgements. These conditions indicate the existence of a material uncertainty which may cast significant doubt about the carrying value of capitalised exploration expenditure associated with Mt Gee (EL 4355). The financial report has been prepared on the basis that there is no impairment of the $15,273,091 capitalised as exploration expenditure. That impairment decision is based on the critical assumption that the Mt Gee licence (EL 4355) will be renewed when it expires in October 2010 and the company will be permitted to resume comprehensive exploration activities on the Mt Gee lease.

The outcome of the Mt Gee licence and continuing exploration activities matter may impact the company’s ability to raise further capital.

GRANT THORNTON South Australian Partnership Chartered Accountants

J L Humphrey Partner

Signed at Wayville this 11[th] day of March 2010