ORE RESOURCES LIMITED - Capital/Financing Update 2011

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Replacement Prospectus

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TerranoVa minerals limiTed aBn 91 148 966 545

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This is a replacemenT prospecTus daTed 7 July 2011.

iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

IMPORTANT NOTICE

This replacement prospectus is dated 7 July 2011 (prospectus) and was lodged with the asic on that date. it replaces the original prospectus lodged with asic on 30 June 2011. The asic and its officers take no responsibility for the contents of this prospectus or the merits of the investment to which the prospectus relates.

The expiry date of this prospectus is at 5.00pm WsT on that date which is 13 months after the date the original prospectus was lodged with the asic (expiry date). no securities may be issued on the basis of this prospectus after the expiry date.

application will be made to asX within seven days after the date of this prospectus for official Quotation of the shares the subject of this prospectus.

The distribution of this prospectus in jurisdictions outside australia may be restricted by law and persons who come into possession of this prospectus should seek advice on and observe any of these restrictions. failure to comply with these restrictions may violate securities laws. applicants who are resident in countries other than australia should consult their professional advisers as to whether any governmental or other consents are required or whether any other formalities need to be considered and followed.

This prospectus does not constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer.

it is important that investors read this prospectus in its entirety and seek professional advice where necessary. The shares the subject of this prospectus should be considered speculative.

WEB SITE – ELECTRONIC PROSPECTUS

a copy of this prospectus can be downloaded from the website of the company at www.terranovaminerals.com.au. any person accessing the electronic version of this prospectus for the purpose of making an investment in the company must be an australian resident and must only access the prospectus from within australia.

The corporations act prohibits any person passing onto another person an application form unless it is attached to a hard copy of this prospectus or it accompanies the complete and unaltered version of this prospectus. any person may obtain a hard copy of this prospectus free of charge by contacting the company.

EXPOSURE PERIOD

This prospectus will be circulated during the exposure period. The purpose of the exposure period is to enable this prospectus to be examined by market participants prior to the raising of funds. potential investors should be aware that this examination may result in the identification of deficiencies in the prospectus and, in those circumstances, any application that has been received may need to be dealt with in accordance with section 724 of the corporations act.

applications for shares under this prospectus will not be processed by the company until after the expiry of the exposure period. no preference will be conferred on persons who lodge applications prior to the expiry of the exposure period.

COMPETENT PERSONS STATEMENT

The information in this prospectus that relates to exploration results (excluding the independent geologist’s report in section 6) is based on information compiled by mr Ben pollard, B.sc (mineral exploration and mining geology), who is a member of the australian institute of mining and metallurgy. mr pollard has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he 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’. mr pollard is a geologist with 15 years experience in the resources industry having held roles with various mining companies exposed to precious and base metals and industrial minerals. mr pollard currently holds the role of principal geologist with Bmgs perth. mr pollard consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Table of contents

12 Section 1 Corporate DireCtory 14 Section 2 Chairman’s Letter Section 3 16 DetaiLs of the offer 19 Section 4 22 Section 5 31 Section 6 52 Section 7 67 Section 8 Section 9 79 risk faCtors Section 10 83 materiaL ContraCts 87 Section 11 93 Section 12 Section 13 95 gLossary 97 appLiCation forms

Corporate DireCtory

Section 2 Chairman’s Letter

Section 3 DetaiLs of the offer

Company anD projeCt overview

DireCtors anD Corporate governanCe

inDepenDent geoLogist’s report

Section 7 investigating aCCountant’s report

Section 8 soLiCitor’s report on tenements

Section 10 materiaL ContraCts

Section 11 aDDitionaL information

Section 12 DireCtors’ authorisation

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview

This section is a summary only and is not intended to provide full information for investors intending to apply for shares offered pursuant to this prospectus. This prospectus should be read and considered in its entirety.

THE COMPANY

The company is a speculative exploration company which has entered into an acquisition agreement with red field giving the company the right to acquire 100% of the Beete gold project and the peninsula gold project located in Western australia. a summary of this agreement is in section 10.1 of this prospectus.

The company has also applied for exploration licence e09/1899, known as the crawford project.

details on the company’s projects are set out in the investment highlights, section 4 and section 6 of this prospectus.

By resolution passed on 1 march 2011, the company obtained approval to change status from a public limited company to a no liability company (i.e. nl). The change to a no liability company is expected to occur prior to the date that the company lists on asX. for details on the material differences between a limited liability and no liability companies refer to section 11.1.

THE OFFER

By this prospectus, the company invites investors to apply for up to 20,000,000 shares at an issue price of $0.20 each in order to raise up to $4,000,000.

oversubscriptions of up to a further 2,500,000 shares at an issue price of $0.20 each to raise up to $500,000 may be accepted.

INDICATIVE TIMETABLE

lodgement of original prospectus with
the asic 30	June 2011
lodgement of replacement prospectus
with asic	7 July 2011
opening date	8 July 2011
closing date 5.00pm WsT	on 1 august 2011
despatch of holding statements	8 august 2011
expected date for listing on asX	15 august 2011

The above dates are indicative only and may change without notice. The company reserves the right to extend the closing date or close the offer early without notice.

PURPOSE OF THE OFFER

The purpose of this offer is to provide additional funds to enable the company to:

(a) explore and develop the Beete gold project and peninsula gold project located in Western australia;
(b) explore and develop the crawford project located in Western australia once this tenement is granted;
(c) identify and evaluate new mineral resource opportunities in australia and overseas;
(d) meet the costs of the offer; and
(e) provide working capital.

on completion of the offer, the Board believes the company will have sufficient capital to achieve these objectives.

The shares offered under this prospectus will rank equally with the existing shares on issue. refer to section 3 for further details in relation to the offer.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

USE OF PROCEEDS

The table below sets out the intended application of funds raised under the prospectus on the basis of the company raising the minimum subscription ($4,000,000) and the full oversubscription ($4,500,000) under the offer over a two year period:

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$4,000,000 $4,500,000
ITEM (MINIMUM) (MAXIMUM)
YEAR 1
exploration and evaluation of Beete gold project $170,000 $170,000
exploration and evaluation of peninsula gold project $400,000 $400,000
exploration and evaluation of crawford project $120,000 $120,000
costs of offer $526,739 $553,075
Working capital $616,631 $853,463
administration costs $400,000 $400,000
TOTAL YEAR 1 $2,233,370 $2,496,538
YEAR 2
exploration and evaluation of Beete gold project $220,000 $220,000
exploration and evaluation of peninsula gold project $500,000 $500,000
exploration and evaluation of crawford project $80,000 $80,000
Working capital $566,630 $803,462
administration costs $400,000 $400,000
TOTAL YEAR 2 $1,766,630 $2,003,462
TOTAL YEARS 1 & 2 $4,000,000 $4,500,000
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please refer to the independent geologist’s report in section 6 for further details on the company’s proposed exploration programs. please note, the use of proceeds does not include the company’s existing cash in bank, being approximately $150,000, which is intended to be applied towards working capital.

if the company raises between the minimum subscription ($4,000,000) and the full oversubscription ($4,500,000) under the offer, the amount raised in excess of the minimum subscription (after expenses) is intended to be applied to working capital.

Working capital may be used by the company to identify and evaluate new mineral resource opportunities in australia and overseas.

administration and working capital will include the fees agreed to be paid to hemisphere corporate pursuant to the agreement outlined in section 10.4, sundry costs such as share registry, asX fees, executive and non-executive salaries and the salaries of any additional staff or consultants that may be retained by the company in the future.

The above tables are a statement of current intentions as of the date of lodgement of this prospectus with the asic. as with any budget, intervening events (including exploration success or failure) and new circumstances have the potential to affect the ultimate way funds will be applied. The Board reserves the right to alter the way funds are applied on this basis.

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

CAPITAL STRUCTURE

The capital structure of the company following completion of the offer is summarised below[1] :

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FULL OVER
SUBSCRIPTION SUBSCRIPTION
ITEM $4,000,000 $4,500,000
FULLY PAID ORDINARY SHARES
shares on issue at prospectus date 1 1
shares now offered 20,000,000 22,500,000
shares to be allotted and issued to red field pty ltd
300,000 300,000
pursuant to the red field agreement.
Total Fully Paid Ordinary Shares 20,300,001 22,800,001
PARTLY PAID SHARES
shares on issue at prospectus date 20,000,000 20,000,000
Total Partly Paid Shares 20,000,000 20,000,000
OPTIONS
options on issue at prospectus date nil nil
Total Options Nil Nil
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Notes:

1 assumes the offer is fully subscribed. refer to the investigating accountant’s report at section 7 for further information.

rights attaching to the shares are summarised in section 11.1 of this prospectus.

rights attaching to the partly paid shares are summarised in section 11.2 of this prospectus.

INVESTMENT HIGHLIGHTS

¬ Terranova minerals limited (Terranova minerals or the company) is an australian based exploration company established primarily to acquire, explore, evaluate and exploit mineral resource projects including bismuth, uranium, gold and copper minerals at the Beete gold project, peninsula gold project and crawford project located in Western australia.

RESTRICTED SECURITIES

subject to the company being admitted to the official list, certain shares on issue prior to the offer will be classified by asX as restricted securities and will be required to be held in escrow for up to 24 months from the date of official Quotation. during the period in which these securities are prohibited from being transferred, trading in shares may be less liquid which may impact on the ability of a shareholder to dispose of his or her shares in a timely manner.

¬ Terranova has entered into an acquisition agreement (acquisition agreement) with red field pty ltd (red field), which currently owns 100% of the Beete gold project and peninsula gold project. refer to section 10.1 for further details of the acquisition agreement.
¬ The peninsula and Beete gold projects are located in the southern extent of the eastern goldfields region of Western australia, in close proximity to the town of norseman.
¬ The crawford project (a new exploration licence application) covers a total land area of 20km2 is located in the crawford Belt of the gascoyne province, 190km east- north east of carnarvon, Western australia.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

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Figure 1: Location of the projects.

¬ The Beete and peninsula gold projects are prospective for gold and other associated minerals, such as bismuth and copper.
¬ gold mined in the norseman region has principally been from narrow, broadly northsouth striking, east dipping quartz veins hosted by biotite altered and sheared mafic and ultramafic lithologies of the Woolyeenyer formation.
¬ at the peninsula gold project, a trial open pit mining operation with a total of 424 tonnes of ore was treated at an average grade of 2.14 g/t au.
¬ The Board has a record of success in the minerals exploration industry and a broad range of experience in commercial dealings including detailed knowledge of the corporate, legal, financial and technical aspects of managing and promoting exploration companies.
¬ in addition to acquiring the Beete gold, peninsula gold and crawford projects, the company intends to pursue new projects in the resources sector, both in australia and overseas, by way of acquisition or investment.
¬ The company’s ability to generate revenue in the future will depend upon the success of the company’s exploration activities on tenements comprising the Beete and peninsula gold projects, the company being granted exploration licence e09/1899, known as the crawford project, and successfully undertaking exploration activities on that tenement. as well as the company’s ability to successfully exploit any minerals that may be discovered on the land which is the subject of the Beete gold, peninsula gold and crawford projects. completion under the red field agreement is conditional upon the company being admitted to the official list. refer to section 10.1 for further details in relation to this agreement.

full details in respect of the company and its projects are set out in sections 4 and 6.

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

KEY RISKS

Status of Tenements

mineral exploration, development and mining are high risk enterprises and only occasionally provide high rewards. potential investors should consider an investment in the company as speculative.

The company aims to manage these risks by carefully planning its activities and implementing risk control measures.

some of the risks are, however, highly unpredictable and the extent to which the company can effectively manage them is limited. some of the key risks associated with an investment in the company are summarised in the following table. This list of risks is not exhaustive of the risks faced by the company or by investors in the company. shareholders should refer to the full details of the risks tabled below are set out in section 9 of this prospectus before making a decision to subscribe for shares under this prospectus. The occurrence of any of the risks or events outlined below could have a materially adverse effect on the company’s operations and, in turn, the price at which its shares trade on asX.

Dilution Risk

set out below are specific risks that the company is exposed to. further risks associated with an investment in the company are outlined in section 9.

Risk Area Risks

Contract Risk The company’s primary asset is its proposed acquisition of the Beete gold project and peninsula gold project held by red field. The company is reliant on red field complying with the terms and conditions of the acquisition agreement and the conditions attaching to the Tenements Limited History (as applicable). should red field fail to comply with the terms of the acquisition agreement, the 9 company’s interest in the Beete gold project and the peninsula gold project may be adversely affected.

The Beete gold project comprises one granted prospecting licence, p63/1646. This prospecting licence expires on 8 July 2013. The peninsula gold project comprises one granted prospecting licence, p63/1694. This prospecting licence expires on 15 July 2013.

The company intends to renew the licences when applicable, however there is no guarantee that the licences will in fact be renewed beyond their current expiry date.

in addition, the company has applied for exploration licence e09/1899. There is no guarantee that this licence will be granted. if exploration licence application e09/1899 was not to be granted, the company would be unable to explore the land covered by this licence for minerals.

on completion of the offer, there will be 20,000,000 partly paid shares on issue. if these partly paid shares are converted into shares there will be a dilution so that the existing shareholders will hold 50.37% (based on the minimum raising under this prospectus) of the outstanding issued shares. each partly paid shares is currently paid up to $0.01 and will require the payment of a further $0.19 in order to become a fully paid share.

The company was incorporated on 25 January 2011 and its operational and financial historical performance is limited. no assurances can be given that the company will achieve commercial viability through the successful exploration and/or mining of the Tenements. until the company is able to realise value from its projects, it is likely to incur ongoing operating losses.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

Native Title Risks The Tenements are at risk of being challenged or impugned and may be subject to native title claims. There is currently a registered native title claim over prospecting licences p63/1694 and p63/1646.

Where native title rights do exist, the ability of the company to gain access to the Tenements (through obtaining consent of any relevant landowner), or to progress from the exploration phase to the development and mining phases of operations may be adversely affected.

please refer to the solicitor’s report on Tenements in section 8 of this prospectus for further details. Exploration The Tenements are at various stages Success of exploration, and potential investors should understand that mineral exploration and development are high-risk undertakings. notwithstanding the experience, knowledge and careful evaluation a company brings to an exploration of the Tenements, there is no assurance that recoverable mineral resources will be identified. even if identified, other factors such as technical difficulties, geological conditions, adverse changes in government policy or legislation or lack of access to sufficient funding may mean that the resource is not economically recoverable or may otherwise preclude the company from successfully exploiting the resource.

The exploration costs of the company will be based on certain assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. accordingly, no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the company’s viability.

FINANCIAL INFORMATION

The company is in the early stages of exploring the land the subject of the Tenements and is in a startup phase, having been recently incorporated to enter into agreements to acquire the Tenements and proceed with this exploration. Therefore, the company’s operational and financial historical performance is limited.

as a result, the company is not in a position to disclose any key financial ratios other than its balance sheet which is set out in the investigating accountant’s report in section 7. investors should read the investigating accountant’s report in full.

The company’s start up funding will be generated from the initial public offering of shares pursuant to this prospectus. The company expects to raise further funding from the issue of securities in the future. if the company’s proposed exploration is successful and the company chooses to develop its projects then the company may also consider debt funding.

DIRECTORS

Mr Benjamin Bussell non-executive chairman

Benjamin Bussell is a senior accountant with over 12 years experience in public accounting, corporate accounting and taxation. mr Bussell is currently the chief financial officer of asX listed mineral exploration companies stonehenge metals limited, Zyl limited, segue resources ltd and excelsior gold limited.

mr Bussell is also currently a director of asX listed sWW energy limited.

mr Bussell does not expect that his directorships with other companies or other business activities will interfere with his ability to act as non-executive chairman to the company.

Mr Matthew Foy

executive director and company secretary

matthew foy was a senior adviser at the australian securities exchange with 4 years experience in facilitating the compliance of listed companies. mr foy has reviewed and approved the listing of over 40 companies during his tenure at the asX.

mr foy has been involved in a number of seed capital raisings and initial public offering and possess significant commercial and corporate experience.

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

mr foy is currently the company secretary of asX listed red october resources limited and is currently a director of asX listed sWW energy limited.

mr foy does not expect that his directorships with other companies or other business activities will interfere with his ability to act as an executive director and company secretary to the company.

Mr Robert Jewson non-executive director

robert Jewson has extensive experience across a wide range of commodities including gold, iron ore, nickel, base metals, tin, tungsten, uranium, Vanadium, manganese and coal. mr Jewson has compiled numerous regional geological data sets, targeting projects across a broad geography including australia, Brazil, chile, guinea, poland, south africa, south Korea and spain.

mr Jewson has significant commercial and geological knowledge ranging from country wide analysis to project scale evaluations in numerous localities and has a proven track record in facilitating project acquisitions from target inception to completion.

mr Jewson actively consults to a number of asX listed junior mining companies, aim listed and private enterprises, offering a full suite of geological consulting services, ranging from project evaluation, project identification, geological reviews.

mr Jewson provides Terranova with a methodical technological approach to project evaluation and identification, applying all available legacy and current data, verified by on ground evaluation minimising exploration risk and has proven methods to allow for rapid project identification, verification and ranking of targets.

mr Jewson does not expect that his other business activities will interfere with his ability to act as a nonexecutive director to the company.

INTERESTS OF DIRECTORS IN THE COMPANY’S SECURITIES

directors are not required under the company’s constitution to hold any shares. as at the date of this prospectus, the directors have relevant interests in the company’s securities as set out in the table below:

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PARTLY
PAID
DIRECTOR SHARES SHARES OPTIONS
mr Benjamin Bussell [1] nil nil nil
mr matthew foy nil nil nil
mr robert Jewson nil nil nil
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Notes:

Benjamin Bussell’s fiancé holds 200,000 partly paid shares in the company.

The directors may participate in the offer.

REMUNERATION OF DIRECTORS

The constitution provides that the remuneration of non-executive directors will be not more than the aggregate fixed sum determined by a general meeting. The aggregate remuneration for non-executive directors has been set at an amount not to exceed $250,000 per annum.

The remuneration of executive directors will be fixed by the directors and may be paid by way of fixed salary or consultancy fee.

The annual remuneration (inclusive of superannuation) payable to each of the directors as the date of this prospectus is as follows:

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DIRECTOR ANNUAL REMUNERATION
mr Benjamin Bussell $36,000
mr matthew foy $36,000
mr robert Jewson $36,000
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for details of the directors interest in securities in the company refer to section 11.3 of the prospectus.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

AGREEMENTS WITH DIRECTORS OR RELATED PARTIES

Services Agreement – Matthew Foy

in april 2011, the company and mr matthew foy entered into a service agreement whereby mr foy was engaged as executive director and company secretary of the company.

The term of the service agreement is ongoing until the company gives 1 months notice to mr foy terminating his engagement, or mr foy gives notice to the company, subject to other standard termination provisions.

mr foy’s consultancy fee is $36,000 per annum plus gsT, to be reviewed at 30 June and 31 december each year and will at least be increased by cpi, payable on 30th of each month by instalments equal to 1/12th of the annual fee. mr foy must provide the company with an invoice on or before the 30th of each month for the relevant amount.

The company will reimburse mr foy for all reasonable expenses incurred for general expenses incurred in the performance of his duties.

The agreement contains standard confidentiality, change of control and termination and other clauses expected to be included in an agreement of this type.

Services Agreement – Benjamin Bussell

in april 2011, the company and mr Benjamin Bussell entered into a service agreement whereby mr Bussell was engaged as a non-executive chairman of the company.

The term of the service agreement is ongoing until the company gives 1 months notice to mr Bussell terminating his engagement, subject to other standard termination provisions.

Services Agreement – Robert Jewson

in april 2011, the company and mr robert Jewson entered into a service agreement whereby mr Jewson was engaged as a non-executive director of the company.

The term of the service agreement is ongoing until the company gives 1 months notice to mr Jewson terminating his engagement, subject to other standard termination provisions.

mr Jewson’s consultancy fee is $36,000 per annum plus gsT, to be reviewed at 30 June and 31 december each year and will at least be increased by cpi, payable on 30th of each month by instalments equal to 1/12th of the annual fee. mr Jewson must provide the company with an invoice on or before the 30th of each month for the relevant amount.

The company will reimburse mr Jewson for all reasonable expenses incurred for general expenses incurred in the performance of his duties.

The agreement contains standard confidentiality, change of control and termination and other clauses expected to be included in an agreement of this type.

Deeds of Indemnity, Insurance and Access

The company has entered into a deed of indemnity, insurance and access with each of its directors. under these deeds, the company agrees to indemnity each officer to the extent permitted by the corporations act against any liability arising as a result of the officer acting as an officer of the company. The company is also required to maintain insurance policies for the benefit of the relevant officer and must also allow the officers to inspect board papers in certain circumstances.

mr Bussell’s consultancy fee is $36,000 per annum plus gsT, to be reviewed at 30 June and 31 december each year and will at least be increased by cpi, payable on 30th of each month by instalments equal to 1/12th of the annual fee. mr Bussell must provide the company with an invoice on or before the 30th of each month for the relevant amount.

The company will reimburse mr Bussell for all reasonable expenses incurred for general expenses incurred in the performance of his duties.

The agreement contains standard confidentiality, change of control and termination and other clauses expected to be included in an agreement of this type.

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

SUBSTANTIAL SHAREHOLDERS

Those shareholders holding 5% or more of the shares on issue both as at the date of this prospectus and on completion of the offer (assuming full subscription) are set out in the respective tables below.

As at the date of the Prospectus

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PARTLY PAID %
SHAREHOLDER [2] SHARES [1] (FULLY DILUTED)
nigel Tarratt pty ltd 3,000,000 15.00%
mr daniel christopher macri 2,862,500 14.31%
mr matthew Joel norton 2,862,500 14.31%
mimo strategies pty ltd 2,000,000 10.00%
nautical holdings Wa pty ltd 1,275,000 6.37%
Bevan nigel hugh Tarratt and sophie mackay 1,275,000 6.37%
getmeoutofhere pty ltd 1,000,000 5.00%
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notes.

1 The partly paid shares are paid to $0.01, with a further $0.19 payable in order to become fully paid.

2 The substantial shareholders are all parties involved in the promotion of the company, having some relationship with or employed by either patersons securities or hemisphere corporate.

On completion of the Offer (assuming no existing substantial Shareholder is issued additional Shares pursuant to the Offer and no new investors become substantial holders)

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PARTLY PAID %
SHAREHOLDER [2] SHARES [1] (FULLY DILUTED)
nigel Tarratt pty ltd 3,000,000 7.50%
mr daniel christopher macri 2,862,500 7.16%
mr matthew Joel norton 2,862,500 7.16%
mimo strategies pty ltd 2,000,000 5.00%
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notes.

1 The partly paid shares are paid to $0.01, with a further $0.19 payable in order to become fully paid.

2 The substantial shareholders are all parties involved in the promotion of the company, having some relationship with or employed by either patersons securities limited or hemisphere corporate.

The company will announce to the asX details of its top-20 shareholders (following completion of the offer) prior to the shares commencing trading on asX.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Investment Overview (continued)

EXPENSES OF THE OFFER

The total expenses of the offer (based on $4,000,000 being raised) are estimated to be $526,739 and are expected to be applied towards the items set out in the table below:

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ITEM OF EXPENDITURE AMOUNT
asic fees $2,068
legal fees $30,000
independent consulting geologist $12,000
investigating accountant $15,000
corporate advisory fees $60,000
corporate advisory success fee $150,000
asX fees $27,671
selling fee and issue management fee $200,000
printing and other expenses $30,000
TOTAL $526,739
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if over subscriptions of $500,000 are accepted, the cash expenses of the offer will increase due to an increase on asX fees, corporate advisory fees, selling fee and issue management fee.

DIVIDEND POLICY

We anticipate that significant expenditure will be incurred in the evaluation and development of our company’s projects. These activities, together with the possible acquisition of interests in other projects, are expected to dominate the two year period following the date of this prospectus. accordingly, the company does not expect to declare any dividends during that period.

any future determination as to the payment of dividends by the company will be at the discretion of the directors and will depend on the availability of distributable earnings and operating results and financial condition of the company, future capital requirements and general business and other factors considered relevant by the directors. no assurance in relation to the payment of dividends or franking credits attaching to dividends can be given by the company.

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Corporate Directory

DIRECTORS

INVESTIGATING ACCOUNTANT

Benjamin Bussell Non-Executive Chairman

Bdo corporate finance (Wa) pty ltd 38 station street subiaco Wa 6008

matthew foy Executive Director

LAWYERS

robert Jewson Non-Executive Director

COMPANY SECRETARY

matthew foy

steinepreis paganin lawyers and consultants level 4, The read Buildings 16 milligan street perth Wa 6000

REGISTERED OFFICE

level 8 225 st georges Terrace perth Wa 6000

INDEPENDENT GEOLOGIST

Bmgs perth pty ltd suite 9 123a colin street West perth Wa 6005

WEBSITE

CORPORATE ADVISOR

www.terranovaminerals.com.au

SHARE REGISTRY*

hemisphere corporate services pty ltd level 8 225 st georges Terrace perth Wa 6000

security Transfer registrars pty ltd 770 canning highway applecross Wa 6153 Telephone: (08) 9315 2333 facsimile: (08) 9315 2233

PROPOSED ASX CODE

TnV

This entity is included for information purposes only and has not been involved in the preparation of this prospectus.

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T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

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Chairman’s Letter

dear investor

on behalf of the directors, i am pleased to present this prospectus and to offer you the opportunity to invest in Terranova minerals limited ( Terranova Minerals or the Company ).

This prospectus has been issued by Terranova minerals for an initial public offering of up to 20,000,000 shares at 20 cents per share to raise up to $4,000,000 with oversubscriptions of up to a further 2,500,000 shares to raise a further $500,000 may be accepted ( Offer ).

Terranova minerals has entered into an acquisition agreement ( Acquisition ) with red field pty ltd ( Red Field ) to advance exploration for gold, copper and other associated minerals at the Beete gold project and peninsula gold project in Western australia.

under the acquisition, Terranova minerals will acquire 100% of the Beete gold project and peninsula gold project for the payment of $65,000 payable in cash as consideration for the reimbursement of previous exploration costs and the issue of 300,000 fully paid ordinary shares in Terranova minerals issued to red field. The full terms of the acquisition are contained in section 10.1 of this prospectus.

small scale open cut and underground mining has previously occurred at the peninsula gold project. a trial open pit mining operation with a total of 424 tonnes of ore was treated at an average grade of 2.14 g/t au. a decline was developed by central norseman gold corporation limited at the southern end of the project. a total of 495 tonnes averaging 1.62g/t au was mined by means of the decline construction.

The funds raised under this prospectus will support the exploration and development of the Beete gold project, the peninsula gold project and the crawford project, and provide working capital whilst concurrently allowing the company to continue to evaluate new project opportunities.

The company has been actively evaluating new acquisition and joint venture opportunities in the resources sector. evaluation of these new projects is at an early stage and has not yet been concluded. The company has not yet entered into any agreements in respect of these projects and there is no guarantee that it will do so in the future.

This prospectus includes details of the offer, the company, the assets and proposed operations together with a statement of the risks associated with investing in Terranova minerals. i recommend that you study the document carefully and seek independent professional advice before investing in Terranova minerals.

on behalf of the board of directors, i commend this offer to you and look forward to welcoming you as a shareholder of Terranova minerals.

yours sincerely,

Benjamin Bussell

non-executive chairman

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Details of the Offer

3.1 THE OFFER

By this prospectus, the company invites investors to apply for up to 20,000,000 shares at an issue price of $0.20 each in order to raise up to $4,000,000.

oversubscriptions of up to a further 2,500,000 shares at an issue price of $0.20 each to raise up to an additional $500,000 may be accepted.

The shares offered under this prospectus will rank equally with the company’s existing shares on issue.

3.2 APPLICATIONS

applications for shares under this prospectus must be made using the application form.

payment for the shares must be made in full at the issue price of $0.20 per share. applications for shares must be for a minimum of 10,000 shares and thereafter in multiples of 1,000 shares. completed application forms and accompanying cheques must be mailed or delivered to:

security Transfer registrars pty ltd 770 canning highway applecross Wa 6153

security Transfer registrars pty ltd po Box 535 applecross Wa 6953

cheques should be made payable to “Terranova Minerals Limited – Share Offer Account” and crossed “Not Negotiable” . completed application forms must reach one of the above addresses by no later than the closing date.

The company reserves the right to close the offer early.

3.3 ALLOTMENT

The directors reserve the right to allot shares in full for any application or to allot any lesser number or to decline any application. Where the number of shares allotted is less than the number applied for, or where no allotment is made, the surplus application monies will be returned by cheque to the applicant as soon as practicable after the allotment date.

3.4 ASX LISTING

The company will apply to asX within seven days after the date of this prospectus for admission to the official list and for official Quotation of the shares offered under this prospectus. if the shares are not admitted to quotation on asX within three (3) months after the date of this prospectus, or such longer period as is permitted by the corporations act, all applications will be dealt with in accordance with the corporations act.

3.5 APPLICANTS OUTSIDE AUSTRALIA

This prospectus does not, and is not intended to, constitute an offer in any place or jurisdiction, or to any person to whom it would not be lawful to make such an offer or to issue this prospectus. The distribution of this prospectus in jurisdictions outside australia may be restricted by law and persons who come into possession of this prospectus should seek advice on and observe any such restrictions. any failure to comply with such restrictions may constitute a violation of applicable securities laws. no action has been taken to register or qualify the shares or otherwise permit a public offering of the shares the subject of this prospectus in any jurisdiction outside australia.

it is the responsibility of applicants outside australia to obtain all necessary approvals for the allotment and issue of the shares pursuant to this prospectus. The return of a completed application form will be taken by the company to constitute a representation and warranty by the applicant that all relevant approvals have been obtained.

subject to asX granting conditional approval for the company to be admitted to the official list and the company raising the minimum subscription under the offer (being the full subscription), allotment of shares offered by this prospectus will take place as soon as practicable after the closing date. prior to allotment, all application monies shall be held by the company on trust. The company, irrespective of whether the allotment of shares takes place, will retain any interest earned on the application monies.

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Details of the Offer (continued)

3.6 MINIMUM SUBSCRIPTION

The minimum subscription in respect of the offer is $4,000,000, being the full subscription.

if the minimum subscription has not been raised within four months after the date of this prospectus, the company will either repay the application monies to applicants or issue a supplementary or replacement prospectus to allow applicants one month to withdraw their application and be repaid their application money. no interest will be paid on this money.

3.7 UNDERWRITER

The offer is not underwritten.

3.8 COMMISSIONS ON APPLICATION FORMS

The company reserves the right to pay a commission of 5% (exclusive of goods and services tax) of amounts subscribed to any licensed securities dealers or australian financial services licensee in respect of valid applications lodged and accepted by the company and bearing the stamp of the licensed securities dealer or australian financial services licensee. payments will be subject to the receipt of a proper tax invoice from the licensed securities dealer or australian financial services licensee.

3.9 CHESS

The company will apply to participate in the clearing house electronic subregister system ( CHESS ). chess is operated by asX settlement pty ltd ( ASXS ), a wholly owned subsidiary of asX, in accordance with the listing rules and the asX settlement operating rules.

revenues and expenses of the company. on this basis and after considering regulatory guide 170, the directors believe that reliable financial forecasts for the company cannot be prepared and accordingly have not included financial forecasts in this prospectus.

3.11 PRIVACY STATEMENT

if you complete an application for shares, you will be providing personal information to the company. The company collects, holds and will use that information to assess your application, service your needs as a shareholder and to facilitate distribution payments and corporate communications to you as a shareholder.

The information may also be used from time to time and disclosed to persons inspecting the register, including bidders for your securities in the context of takeovers; regulatory bodies, including the australian Taxation office; authorised securities brokers; print service providers; mail houses and the share registry.

you can access, correct and update the personal information that we hold about you. if you wish to do so, please contact the share registry at the relevant contact number set out in this prospectus.

collection, maintenance and disclosure of certain personal information is governed by legislation including the privacy act 1988 (as amended), the corporations act and certain rules such as the asX settlement operating rules. you should note that if you do not provide the information required on the application for shares, the company may not be able to accept or process your application.

under chess, the company will not issue certificates to investors. instead, share and option holders will receive a statement of their holdings in the company. if an investor is broker sponsored, asXs will send a chess statement.

3.10 FORECAST FINANCIAL INFORMATION

given the speculative nature of mineral exploration and development and the fact the company is in an early stage of exploration, there are significant uncertainties associated with forecasting future

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04

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

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Company and Project Overview

4.1 COMPANY OVERVIEW

The company was incorporated on 25 January 2011.

on or about 9 may 2011, the company entered into an acquisition agreement with red field giving the company the right to acquire 100% of the Beete gold project and the peninsula gold project located in Western australia.

The company intends to engage suitable qualified consultants and contractors to complete its proposed exploration programs at the Beete gold project and the peninsula gold project whilst concurrently pursuing new mineral resource project opportunities across other geographies and commodities.

4.2 OVERVIEW AND LOCATION OF PENINSULA AND BEETE GOLD PROJECTS

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The peninsula gold project is located approximately 25 kilometres northeast of the norseman town site. access is attained by travelling from the town approximately 14 kilometres east along the eyre highway and then approximately 32 kilometres north-west along bush tracks. access to the Beete gold project is attained by travelling from norseman approximately 50 kilometres south along the eyre highway.

The norseman area lies at the southern extent of the norseman-Wiluna greenstone Belt of the eastern goldfields province of the yilgarn Block, Western australia. gold was first discovered at norseman in 1894 following discoveries at dundas, 22 km to the south in 1892. The majority of production in the region has come from the mararoa-crown (main field) and north royal reefs.

The oldest unit within the norseman area is the penneshaw formation. The western part of this unit is dominated by amphibolites with minor sedimentary and felsic rocks, whereas the eastern part comprises intercalated amphibolites and highly deformed felsic lithologies. The overlying noganyer formation consists of sedimentary iron formations, siltstones and sandstones, and minor carbonaceous shale and is in turn overlain by the Woolyeenyer formation. The Woolyeenyer formation is dominated by mafic volcanic rocks with minor conformable ultramafic units and sedimentary bands. These rocks are intruded by mafic dykes with a dominant north-northeast to north-northwest trend that are interpreted to be syn-volcanic.

4.3 OVERVIEW AND LOCATION OF CRAWFORD PROJECT

The crawford project is located in the crawford Belt of the gascoyne province, 190km east-north east of carnarvon, Western australia. The project area lies on the mt sandiman 1:100,000 map sheet and the Kennedy range 1:250,000 map sheet (sg50-01).

The main access to the area is via the Williamburymt sandiman road. Various station tracks occur across the project area. a grid cut by crae provides across the crawford project area.

Figure 2: Peninsula and Beele Projects Location Plan

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Company and Project Overview (continued)

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4.4 FURTHER INFORMATION

further information on the peninsula gold project, Beete gold project and the crawford project is set out in the independent geologist’s report in section 6 of this prospectus.

4.5 OTHER PROJECTS

in addition to acquiring 100% of the Beete gold project and the peninsula gold project (and seeking the grant of the exploration licence over the crawford project), the company intends to continue to actively pursue new projects in the resources sector, both in australia and overseas, by way of acquisition or investment. These projects may include other types of minerals, including copper and gold, located in countries other than australia including, for example, south africa.

Figure 3: Crawford Project Location Plan

The crawford project is underlain by proterozoic metamorphic rocks of the morrissey metamorphic suite. The project is centred on an ese striking belt of biotite-chlorite-white mica schist that also include garnet, staurolite, andalusite, tourmaline and magnetite prophroblasts at various locations.

mineralisation occurs in a system of WnW-ese trending quartzite and tourmalinite veins, concordant with the foliation of the schists. These veins are thought to be derived from the minnie creek Batholith during a late phase of orogeny. The association of the veins with the nick Belt plutons is unclear, but from limited outcrop evidence it appears that they actually intrude the granite. some of these veins form prominent gossanous ridges. most of the veins display leached cavities and limonitic boxwork textures.

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Directors and Corporate Governance

5.1 DIRECTORS

disclosure of the directors and their background is contained at the beginning of this prospectus in the investment overview section.

The company is committed to the circulation of relevant materials to directors in a timely manner to facilitate directors’ participation in the Board discussions on a fully-informed basis.

5.2.2 COMPOSITION OF THE BOARD

5.2 CORPORATE GOVERNANCE

The directors monitor the business affairs of the company on behalf of shareholders and have formally adopted a corporate governance policy which is designed to encourage directors to focus their attention on accountability, risk management and ethical conduct.

To the extent applicable, our company has adopted The corporate governance principles and recommendations (2nd edition) as published by asX corporate governance council (recommendations).

5.2.1 THE BOARD OF DIRECTORS

The company’s Board of directors are responsible for corporate governance of the company. The Board develops strategies for the company, reviews strategic objectives and monitors performance against those objectives. The goals of the corporate governance processes are to:

(a) maintain and increase shareholder value;
(b) ensure a prudential and ethical basis for the company’s conduct and activities; and
(c) ensure compliance with the company’s legal and regulatory objectives.

election of Board members is substantially the province of the shareholders in general meeting. however, subject thereto, the company is committed to the following principles:

(a) the Board is to comprise directors with a blend of skills, experience and attributes appropriate for the company and its business; and
(b) the principal criterion for the appointment of new directors is their ability to add value to the company and its business.

no formal nomination committee or procedures have been adopted for the identification, appointment and review of the Board membership, but an informal assessment process, facilitated by the chairman in consultation with the company’s professional advisors, has been committed to by the Board.

5.2.3 INDEPENDENT PROFESSIONAL ADVICE

subject to the chairman’s approval (not to be unreasonably withheld), the directors, at the company’s expense, may obtain independent professional advice on issues arising in the course of their duties.

5.2.4 REMUNERATION ARRANGEMENTS

consistent with these goals, the Board assumes the following responsibilities:

(a) developing initiatives for profit and asset growth;
(b) reviewing the corporate, commercial and financial performance of the company on a regular basis;
(c) acting on behalf of, and being accountable to, the shareholders; and
(d) identifying business risks and implementing actions to manage those risks and corporate systems to assure quality.

The remuneration of an executive director will be decided by the Board, without the affected executive director participating in that decision-making process.

The total maximum remuneration of non-executive directors is the subject of a shareholder resolution in accordance with the company’s constitution, the corporations act and the asX listing rules, as applicable. The determination of non-executive directors’ remuneration within that maximum will be made by the Board having regard to the inputs and value to the company of the respective contributions by each non-executive director. The current limit, which may only be varied by shareholders in general meeting, is an aggregate amount of $250,000 per annum.

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Directors and Corporate Governance (continued)

The Board may award additional remuneration to non-executive directors called upon to perform extra services or make special exertions on behalf of the company.

5.2.5 EXTERNAL AUDIT

The company in general meetings is responsible for the appointment of the external auditors of the company, and the Board from time to time will review the scope, performance and fees of those external auditors.

5.2.6 IDENTIFICATION AND MANAGEMENT OF RISK

5.2.7 ETHICAL STANDARDS

The Board is committed to the establishment and maintenance of appropriate ethical standards.

5.3 DEPARTURES FROM RECOMMENDATIONS

following admission to the official list of asX, the company will be required to report any departures from the recommendations in its annual financial report.

The company’s compliance and departures from the recommendations as at the date of this prospectus are set out on the following pages.

The Board’s collective experience will enable accurate identification of the principal risks that may affect the company’s business. Key operational risks and their management will be recurring items for deliberation at Board meetings.

PRINCIPLES AND RECOMMENDATIONS

COMMENT

1. Lay solid foundations for management and oversight

1.1 companies should establish the functions reserved to the board and those delegated to senior executives and disclose those functions.

The company’s corporate governance plan includes a Board charter, which discloses the specific responsibilities of the Board.

The Board delegates responsibility for the day-to-day operations and administration of the company to the executive director.

1.2 companies should disclose the process for evaluating the performance of senior executives.

The company’s corporate governance plan includes a section on performance evaluation practices adopted by the company.

The chair will monitor the Board and the Board will monitor the performance of any senior executives who are not directors, including measuring actual performance against planned performance.

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Directors and Corporate Governance (continued)

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PRINCIPLES AND RECOMMENDATIONS COMMENT
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1.3	companies should provide the information indicated	explanation of departures from principles and
	in the guide to reporting on principle 1.	recommendations 1.1 and 1.2 (if any) are set out
		above. The company will also explain any departures
		from principles and recommendations 1.1 and 1.2
		(if any) in its future annual reports.
		no performance evaluation of senior executives has
		taken place to date as this process is conducted
		annually and the frst year has not been completed.
		future annual reports will disclose whether such a
		performance evaluation has taken place in the relevant
		reporting period and whether it was in accordance with
		the process disclosed.
		The corporate governance plan, which includes the
		Board charter, is posted on the company’s website.
2.	Structure the board to add value
2.1	a majority of the board should be independent	a majority of the Board are independent directors.
	directors.
2.2	The chair should be an independent director.	The chair is an independent director.
2.3	The roles of chair and chief executive ofcer should	The company has an executive director (considered to
	not be exercised by the same individual.	be equivalent of the chief executive ofcer) who is
		separate from the chair.
2.4	The board should establish a nomination committee.	no formal nomination committee has been established
		by the company as yet. The Board, as a whole, currently
		serves as the nomination committee.
		The company’s corporate governance plan includes a
		nomination committee charter, which discloses the
		specifc responsibilities of the committee.
		Where necessary, the Board seeks advice of external
		advisers in connection with the suitability of applicants
		for Board membership.
2.5	companies should disclose the process for	The company’s corporate governance plan includes a
	evaluating the performance of the board, its	section on performance evaluation practices adopted
	committees and individual directors.	by the company.
		The chair will review the performance of the Board, its
		committees (if any) and individual directors to ensure
		that the company continues to have a mix of skills and
		experience necessary for the conduct of its activities.

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Directors and Corporate Governance (continued)

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PRINCIPLES AND RECOMMENDATIONS COMMENT
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2.6	companies should provide the information indicated	The company has provided details of each director, such
	in the guide to reporting on principle 2.	as their skills, experience and expertise relevant to their
		position in this prospectus and will also provide these
		details on its website and in future annual reports.
		explanation of departures from principles and
		recommendations 2.1, 2.2, 2.3, 2.4 and 2.5 (if any) are
		set out above. The company will also explain any
		departures from principles and recommendations 2.1,
		2.2, 2.3, 2.4 and 2.5 (if any) in its future annual reports.
		no performance evaluation of the Board, its
		committees and individual directors has taken place to
		date as this process is conducted annually and the frst
		year has not been completed. future annual reports will
		disclose whether such a performance evaluation has
		taken place in the relevant reporting period and whether
		it was in accordance with the process disclosed.
		The corporate governance plan, which includes the
		nomination committee charter, is posted on the
		company’s website.
3.	Promote ethical and responsible decision-
	making
3.1	companies should establish a code of conduct and	The company’s corporate governance plan includes a
	disclose the code or a summary of the code as to:	‘corporate code of conduct’, which provides a
		framework for decisions and actions in relation to
	¬the practices necessary to maintain confidence	ethical conduct in employment.
	in the company’s integrity
	¬the practices necessary to take into account
	their legal obligations and the reasonable
	expectations of their stakeholders
	¬the responsibility and accountability of individuals
	for reporting and investigating reports of
	unethical practices.
3.2	companies should establish a policy concerning	The company’s corporate governance plan includes a
	diversity and disclose the policy or a summary of	‘diversity policy’, which provides a framework for
	that policy. The policy should include requirements	establishing measureable objectives for achieving
	for the board to establish measureable objectives	gender diversity and for the Board to assess annually
	for achieving gender diversity and for the board to	both the objectives and progress in achieving them.
	assess annually both the objectives and progress in
	achieving them.
3.3	companies should disclose in each annual report	This disclosure has not yet been made as the frst year
	the measureable objectives for achieving gender	has not been completed. future annual reports will
	diversity set by the board in accordance with the	disclose the measureable objectives for achieving
	diversity policy and progress in achieving them.	gender diversity set by the board in accordance with the
		diversity policy and progress in achieving them.

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Directors and Corporate Governance (continued)

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PRINCIPLES AND RECOMMENDATIONS COMMENT
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3.4	companies should disclose in each annual report	companies should disclose in each annual report	This disclosure has not yet been made as the frst year
	the proportion of women employees in the whole		has not been completed. future annual reports will
	organisation, women in senior executive positions		disclose the proportion of women employees in the
	and women on the board.		whole organisation, women in senior executive positions
			and women on the board.
3.5	companies should provide the information indicated		explanation of departures from principles and
	in the guide to reporting on principle 3.		recommendations 3.1, 3.2, 3.3 and 3.4 (if any) are set
			out above. The company will also explain any departures
			from principles and recommendations 3.1, 3.2, 3.3 and
			3.4 (if any) in its future annual reports.
			The corporate governance plan, which includes the
			corporate code of conduct and diversity policy, is
			posted on the company’s website.
4.	Safeguard integrity in financial reporting
4.1	The board should establish an audit committee.		no formal audit committee has been established by the
			company as yet. The Board, as a whole, currently serves
			as the audit committee.
4.2	The audit committee should be structured so that		Whilst the audit committee is not structured in the
	it:		manner set out in the principles and recommendations,
			the Board is of the view that the experience and
	¬	consists only of non-executive directors	professionalism of the persons on the Board is
	¬	consists of a majority of independent directors	sufcient to ensure that all signifcant matters are appropriately addressed and actioned. further, the
	¬	is chaired by an independent chair, who is not	Board does not consider that the company is of
		chair of the board	sufcient size to justify the appointment of additional
			directors for the sole purpose of satisfying this
	¬	has at least three members.	recommendation as it would be cost prohibitive and
			counterproductive.
			as the operations of the company develop the Board will
			reassess the formation of the audit committee.
4.3	The audit committee should have a formal charter.		The company’s corporate governance plan includes an
			audit and risk committee charter, which discloses its
			specifc responsibilities.
4.4	companies should provide the information indicated		explanation of departures from principles and
	in the guide to reporting on principle 4.		recommendations 4.1, 4.2 and 4.3 (if any) are set out
			above. The company will also explain any departures
			from principles and recommendations 4.1, 4.2 and 4.3
			(if any) in its future annual reports.
			The corporate governance plan, which includes the
			audit & risk committee charter, is posted on the
			company’s website.

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Directors and Corporate Governance (continued)

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PRINCIPLES AND RECOMMENDATIONS COMMENT
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5.	Make timely and balanced disclosure
5.1	companies should establish written policies	The company has a continuous disclosure program in
	designed to ensure compliance with asX listing	place designed to ensure the compliance with asX
	rule disclosure requirements and to ensure	listing rule disclosure and to ensure accountability at a
	accountability at a senior executive level for that	senior executive level for compliance and factual
	compliance and disclose those policies or a	presentation of the company’s fnancial position.
	summary of those policies.
5.2	companies should provide the information indicated	The company has not currently departed from principle
	in guide to reporting on principle 5.	and recommendation 5.1. The company will provide an
		explanation of any departures from principle and
		recommendation 5.1 (if any) in its future annual
		reports.
		The corporate governance plan, which includes a
		continuous disclosure program, is posted on the
		company’s website.
6.	Respect the rights of shareholders
6.1	companies should design a communications policy	The company’s corporate governance plan includes a
	for promoting efective communication with	shareholders communication strategy, which aims to
	shareholders and encouraging their participation at	ensure that the shareholders are informed of all major
	general meetings and disclose their policy or a	developments afecting the company’s state of afairs.
	summary of that policy.
6.2	companies should provide the information indicated	The company has not currently departed from principle
	in the guide to reporting on principle 6.	and recommendation 6.1. The company will provide an
		explanation of any departures from principle and
		recommendation 6.1 (if any) in its future annual
		reports.
		The corporate governance plan, which includes a
		shareholders communication strategy, will be posted on
		the company’s website.
7.	Recognise and manage risk
7.1	companies should establish policies for the	The company’s corporate governance plan includes a
	oversight and management of material business	risk management policy.
	risks and disclose a summary of those policies.	The Board determines the company’s “risk profle” and
		is responsible for overseeing and approving risk
		management strategy and policies, internal compliance
		and internal control.
7.2	The board should require management to design	The company’s corporate governance plan includes a
	and implement the risk management and internal	risk management policy.
	control system to manage the company’s material
	business risks and report to it on whether those risks are being managed efectively. The board	The Board will require either the managing director or the chief financial ofcer to provide a report at the
	should disclose that management has reported to it	relevant time.
	as to the efectiveness of the company’s
	management of its material business risks.

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Directors and Corporate Governance (continued)

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PRINCIPLES AND RECOMMENDATIONS COMMENT
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7.3	The board should disclose whether it has received	The Board will seek this relevant assurance from the
	assurance from the chief executive ofcer (or	managing director or chief financial ofcer at the
	equivalent) and the chief fnancial ofcer (or	relevant time.
	equivalent) that the declaration provided in
	accordance with section 295a of the corporations
	act is founded on a sound system of risk
	management and internal control and that the
	system is operating efectively in all material
	respects in relation to fnancial reporting risks.
7.4	companies should provide the information indicated	The company has not currently departed from
	in guide to reporting on principle 7.	principles and recommendations 7.1, 7.2 and 7.3. The
		company will provide an explanation of any departures
		from principles and recommendations 7.1, 7.2 and 7.3
		(if any) in its future annual reports.
		The corporate governance plan, which includes a risk
		management policy, is posted on the company’s
		website.
8.	Remunerate fairly and responsibly
8.1	The board should establish a remuneration	The Board has not established a formal remuneration
	committee.	committee at this point in the company’s development.
		it is considered that the size of the Board along with the
		level of activity of the company renders this impractical
		and the Board, acting without the afected director
		participating in the decision making process, currently
		serves as a remuneration committee.
		The company’s corporate governance plan includes a
		remuneration committee charter, which discloses its
		specifc responsibilities.
		remuneration to the executive directors is by way of
		salary only and to non-executive directors by way of
		director fees only, with the level of such salary or fees
		as the context requires, having been set by the Board to
		an amount it considers to be commensurate for a
		company of its size and level of activity.
		There is currently no link between performance and
		remuneration, however, it is the intention of the Board
		to re-assess this once the company commences
		operations. further there are no schemes for retirement
		benefts in existence.
8.2	The remuneration committee should be structured	although no formal remuneration committee has been
	so that it:	established, the Board currently serves as the
		remuneration committee.
	¬consists of a majority of independent directors
		The Board is comprised of a majority of independent
	¬is chaired by an independent director	directors, is chaired by an independent director and has
	¬has at least three members	at least three members.

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Directors and Corporate Governance (continued)

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PRINCIPLES AND RECOMMENDATIONS COMMENT
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8.3	companies should clearly distinguish the structure	The Board has distinguished the structure of non
	of non-executive directors’ remuneration from that	executive director’s remuneration from that of
	of executive directors and senior executives.	executive directors and senior executives.
		The company’s constitution provides that the
		remuneration of non-executive directors will be not be
		more than the aggregate fxed sum set by the
		constitution and subsequently varied by resolution at a
		general meeting of shareholders.
		The Board is responsible for determining the
		remuneration of executive directors and senior
		executives (without the participation of the afected
		director). it is the Board’s objective to provide maximum
		stakeholder beneft from the retention of a high quality
		Board and executive team by remunerating executive
		directors and senior executives fairly and appropriately
		with reference to relevant employment market
		conditions and by linking the nature and amount of
		executive directors’ and senior executives emoluments
		to the company’s fnancial and operational
		performance.
8.4	companies should provide the information indicated	explanation of departures from principles and
	in the guide to reporting on principle 8.	recommendations 8.1, 8.2 and 8.3 (if any) are set out
		above. The company will also provide an explanation of
		any departures from principles and recommendations
		8.1, 8.2 and 8.3 (if any) in its future annual reports.
		The corporate governance plan, which includes the
		remuneration committee charter, is posted on the
		company’s website.

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INDEPENDENT GEOLOGIST’S REPORT 06

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Independent Geologist’s Report

I.	EXECUTIVE SUMMARY	35	V.	DECLARATIONS BY BMGS	DECLARATIONS BY BMGS	48
a.	purpose	35	a.	independence		48
B.	locaTion and Tenure	35	B.	QualificaTions		48
c.	geology seTTing and mineralisaTion	35	VI.	BIBLIOGRAPHY		48
d.	hisTorical WorKings	35
e.	preVious eXploraTion	36	VII.	GLOSSARY OF ABBREVIATIONS AND TECHNICAL		49
f.	eXploraTion TargeTs	36		TERMS
g.	planned proJecT eXpendiTure	36
II.	INTRODUCTION AND TERMS OF REFERENCE	37
a.	Terms of reference	37	LIST	OF FIGURES
B. c.	purpose for Which The reporT Was prepared ValidaTion of legal Tenure	37 37	figure 1: figure 2:		asset location plan location map – peninsula and Beete gold projects	34 37
III.	PENINSULA AND BEETE GOLD PROJECTS	38	figure 3:		south decline portal - peninsula	38
a.	locaTion and access	38			gold project
B.	VegeTaTion and climaTe	38	figure 4:		eldrige mine inclined shaft at the Beete	39
c.	geology seTTing and mineralisaTion	38			gold project
	1. regional geology	38	figure 5:		peninsula mine cross section	39
	2. project geology	39	figure 6:		historic stope at eldridge mine (Beete	40
	3. mineralisation	39			gold project)
d.	hisTorical WorKings	40	figure 7:		peninsula project collar plan	41
	1. peninsula gold project	40	figure 8:		peninsula mine long section 389,150me	42
	2. Beete gold project	41			with signifcant intercepts
e.	preVious eXploraTion	41	figure 9:		crawford project location plan	45
1.	peninsula gold project	41	figure 10: crawford project geochemical sampling			46
2.	Beete gold project	42
f.	eXploraTion TargeTs	43
g.	planned proJecT eXpendiTure	44	LIST	OF TABLES
IV.	CRAWFORD PROJECT	45
			Table	1:	raB results, australis mining limited,	42
a.	locaTion and access	45			northern decline area, 1984
B.	climaTe and VegeTaTion	45	Table	2:	drilling results, central norseman gold	43
c.	geological seTTing and mineralisaTion	45			corporation, 1982
	1. regional geology	45
	2. project geology	45
	3. mineralisation	46
d.	preVious eXploraTion	46
e.	eXploraTion TargeTs	47
f.	planned proJecT eXpendiTure	47

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Independent Geologist’s Report (continued)

INDEPENDENT GEOLOGIST’S REPORT ON THE MINERAL EXPLORATION PROPERTIES OF TERRANOVA MINERALS LTD

10 June 2011

The directors Terranova minerals ltd lvl 8, 225 st georges Tce perth Wa 6000

dear sirs,

Bm geological services perth (“Bmgs”) has been commissioned by Terranova minerals (“Terranova”) to provide an Independent Geologist’s Report (report) on the peninsula gold and Beete gold projects located in the eastern goldfields and the crawford copper-Bismuth project located in the gascoyne mineral field.

This Independent Geologist’s Report is to be included in the prospectus to be lodged with the australian securities and investments commission (asic). The prospectus will offer 20,000,000 shares at an issue price of $0.20 per share (the “prospectus”), to raise a total of $4,000,000 (before costs associated with the issue). a further $500,000 can be raised through over subscriptions to the offer at an issue price of $0.20 per share under the prospectus for a total of 22,500,000 shares.

The mineral assets comprise two granted prospecting licences and an exploration licence application for a total area of 22 square kilometres. The tenements are held wholly by Terranova.

The objectives of this report are to provide an overview of the geological setting of Terranova’s project area and the associated mineralisation, outline the recent and historical exploration work undertaken in the region and comment on the exploration potential of the project.

Terranova has provided Bmgs with a range of geophysical images, mapping, historical drilling, historical geochemistry and historical reports. Based on Bmgs’s assessment of Terranova’s projects it is our opinion that the conceptual exploration model proposed by Terranova is valid and worthy of further investigation. Bmgs has considered the exploration schedules, studies and exploration programmes proposed by Terranova and considers them to be reasonable and appropriate to progress the project. however, all exploration projects are subject to the risk of impact from unforseen future issues and events beyond the control of the company and Terranova’s projects are not exceptions.

Bmgs has prepared this report upon the understanding that the minerals licences are currently in good legal standing, and has not independently verified Terranova’s legal standing over its tenements. Bmgs is not qualified to make statements in this regard and has relied upon information provided by Terranova.

Bmgs has endeavoured, by making reasonable enquiry of Terranova, to ensure that all material information in the possession of Terranova has been fully disclosed to Bmgs. however, Bmgs has not carried out any type of audit of the records of Terranova to verify that all material documentation has been provided.

BMGS Perth Pty Ltd acn 132 201 873

A: suite 9, 123a colin st, West perth Wa 6005 - p.o. Box 1434, West perth, Wa, 6872

P: (08) 6365 4303 F: (08) 9481 3273

E: [email protected] E: [email protected]

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Independent Geologist’s Report (continued)

This igr has been compiled by mr Ben pollard, B.sc (mineral exploration and mining geology). mr pollard is a geologist with 15 years experience in the resources industry having held roles with various mining companies exposed to precious and base metals and industrial minerals. mr pollard currently holds the role of principal geologist with Bmgs perth, and is a member of the australasian institute of mining and metallurgy, and has the appropriate relevant qualifications, experience, competence and independence to be considered an “expert” under the definitions provided in the Valmin code and a “competent person” as defined in the Jorc code.

Bmgs is an independent consulting and advisory organisation which provides a range of services related to the minerals industry including, in this case, independent geological services, but also resource evaluation, audit, due diligence and risk assessment assistance. The authors of this report declare that they have no material interest in Terranova, its associated entities or the assets described in this report. Bmgs has charged Terranova a professional fee for services rendered, the quantum of which is unrelated to the outcome or the content of this report. The independent geologists report has been prepared on information available up to 5 June 2011.

yours sincerely

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Ben Pollard Bmgs perth pty ltd

BMGS Perth Pty Ltd acn 132 201 873

A: suite 9, 123a colin st, West perth Wa 6005 - p.o. Box 1434, West perth, Wa, 6872

P: (08) 6365 4303 F: (08) 9481 3273

E: [email protected] E: [email protected]

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Independent Geologist’s Report (continued)

I. EXECUTIVE SUMMARY

A. Purpose

Bmgs has prepared this independent geologist’s report (igr) on the mineral assets of Terranova minerals (Terranova) for the purpose of raising funds by means of an initial public offering (ipo). This report represents a competent person’s review and independent assessment of the geology, exploration data, and potential mineralisation at the peninsula gold, Beete gold and crawford copper-Bismuth projects, Western australia. it is the understanding of Bmgs that this report will be included in a prospectus to be lodged with the australian securities and investment commission (asic) for a proposed listing on the australian securities exchange (asX). The purpose of the admission document is to offer for subscription a maximum of 20 million ordinary shares at an issue price of a$0.20 to raise up to $4million. a further $500,000 can be raised through over subscriptions of the offer at an issue price of $0.20 per share under the prospectus for a total of 22,500,000 shares.

B. Location and Tenure

Terranova’s mineral assets include the peninsula gold project (p63/1694), Beete gold project (p63/1646) and crawford copper-Bismuth project (application: e09/1899).

The peninsula and Beete gold projects are located in the southern extent of the eastern goldfields region of Western australia, in close proximity to the town of norseman.

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Figure 1: Asset Location Plan

D. Historical Workings

The crawford project covers a total land area of 20km2 is located in the crawford Belt of the gascoyne province, 190km east-north east of carnarvon, Western australia.

C. Geology Setting and Mineralisation

The projects cover archaean and proterozoic terranes prospective for gold (peninsula and Beete) and base metals (crawford).

gold targets at peninsula and Beete are typical of the geological setting, being lode hosted mesothermal deposits.

Base metal prospectivity at crawford’s is related to late stage, volatile rich fluids associated with granitoid emplacement. These fluids mineralise the dominantly sedimentary country rock with the granitoid suite of ‘mineralogically incompatible’ metals, forming exotic ore mineral assemblages.

small scale open cut and underground mining has been undertaken at the peninsula gold project. a trial open pit mining operation yielding a total of 424 tonnes of ore was treated at a grade of 2.14 g/t au. a decline was developed by central norseman gold corporation limited (cngc) at the southern end of the project. a total of 495 tonnes averaging 1.62g/t au was mined by means of this infrastructure.

at Beete, gold was produced during the years of 19581965, 1968, 1974 and 1976. production records are not available for 1970 to 1974. subsequent to 1974 a total of 2,816 tonnes of ore averaging 24.8g/t au was mined for more than 2,300 ounces.

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Independent Geologist’s Report (continued)

E. Previous Exploration

central norseman gold corporation (“cngc”) has conducted a significant amount of on ground exploration at peninsula, including a total of 44 rotary percussion reverse circulation and diamond drill holes for 3,695m of drilling.

during 1979 and 1980 cngc established a grid over the Beete project, cut and sampled several costeans, performed a resistivity survey over a portion of the area, flew aerial magnetics and drilled a single percussion hole.

J & l morton in 1992 to 1993 conducted surveying, mapping and sampling. geological mapping was conducted in the shaft, the main levels and on the surface. sampling was done in underground openings at 120 locations. hangingwall, “reef” and footwall were differentiated, resulting in 324 samples. 24 surface samples were taken mostly of quartz from costeans.

historically, exploration in the crawford’s region has been conducted by White & White (1991), cra ltd (1993), pasminco (1994) and matlock (1995). activities undertaken include stream sediment sampling, airborne magnetic / radiometrics, ip survey, mapping, petrological and magnetic susceptibility studies and soil sampling.

F. Exploration Targets

Targets at peninsula and Beete are primarily extensional to known gold occurrences. effectively collating and querying the data should provide the potential to unlock mineralisation controls and deduce theories for resource development.

The crawford project represents a poly metallic exploration target which has been subject to limited modern systematic exploration.

G. Planned Project Expenditure

a) peninsula gold project:

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ACTIVITY YEAR 1 YEAR 2 TOTAL
geochemical sampling $25,000 $25,000 $50,000
rc drilling $200,000 $200,000 $400,000
diamond drilling $100,000 $170,000 $270,000
metallurgical Testwork $15,000 $15,000 $30,000
engineering studies - $30,000 $30,000
geological personnel $60,000 $60,000 $120,000
TOTAL $400,000 $500,000 $900,000
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b) Beete gold project:

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ACTIVITY YEAR 1 YEAR 2 TOTAL
geochemical sampling $25,000 $25,000 $50,000
rc drilling $100,000 $150,000 $250,000
metallurgical Testwork $15,000 $15,000 $30,000
geological personnel $30,000 $30,000 $60,000
TOTAL $170,000 $220,000 $390,000
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Independent Geologist’s Report (continued)

c) crawford project:

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ACTIVITY YEAR 1 YEAR 2 TOTAL
desktop data compilation $25,000 - $25,000
geophysical modellingw $15,000 - $15,000
gravity survey $50,000 - $50,000
geochemical sampling - $50,000 $50,000
geological personnel $30,000 $30,000 $60,000
TOTAL $120,000 $80,000 $200,000
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II. INTRODUCTION AND TERMS OF REFERENCE

A. Terms of Reference

Ben pollard has prepared this independent geologists’ report on the mineral assets of Terranova minerals, located in Western australia. The mineral assets comprise two granted prospecting licences peninsula gold project (p63/1694), Beete gold project (p63/1646) and an exploration licence application, the crawford copperBismuth project (e09/1899).

The exploration licenses are held wholly by Terranova minerals

B. Purpose for which the Report was Prepared

it is the author understanding that this report will be included in a prospectus to be lodged with the australian securities and investment commission in or around June 2011 for a proposed listing on the australian securities exchange. The purpose of the admission document is to offer a maximum of 12.5 million ordinary shares at an issue price of a$0.20 to raise a$2.5 million. a further $1,000,000 can be raised through over subscriptions of the offer at an issue price of $0.20 per share under the prospectus for a total of 17,500,000 shares. The funds raised will be used for the purpose of exploration and evaluation of Terranova’s peninsula and Beete gold projects and crawford polymetallic project in Western australia.

The objectives of this report are to:

¬ provide an overview of the regional and local geological setting of Terranova’s peninsula gold project, Beete gold project and crawford copper-Bismuth project area and the associated mineralisation;
¬ outline the historic and recent exploration work undertaken on the project area;
¬ give an opinion on the exploration potential of the project areas; and
¬ consider the appropriateness of Terranova’s proposed exploration and development programme.

C. Validation of Legal Tenure

Bmgs has prepared this report upon the understanding that Terranova’s wholly owned tenements p63/1694, p63/1646 and e09/1899 are currently in good standing and has not independently verified Terranova’s legal tenure over the tenements. Bmgs is not qualified to make statements in this regard and has relied upon information provided by Terranova.

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Independent Geologist’s Report (continued)

III. PENINSULA AND BEETE GOLD PROJECTS

A. Location and Access

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Figure 2: Peninsula and Beele Projects Location Plan

B. Vegetation and Climate

Vegetation in the norseman region varies from open eucalypt woodland to a dense scrub (especially to the southern extents). it is composed of various species of eucalyptus, acacia, casuarina, melaleuca and saltbush (atriplex) and blue bush (Kochia). open grassland with spinifex (Triodia) also occurs in the southern extent of the region.

The average annual rainfall in the norseman region averages 300mm. rainfall predominantly occurs in winter periods, summer thunderstorms can also contribute to the precipitation in the region. The level of evaporation is well in excess of the level of annual precipitation. at norseman the hottest month is January with an average maximum of 33 degrees celsius.

C. Geology Setting and Mineralisation

1. Regional Geology

The Woolyeenyer formation is unconformably overlain by sedimentary and felsic volcanic to volcaniclastic rocks of the mt Kirk formation which is intruded by thick, differentiated mafic sills. The contact between these units is marked by the regionally extensive abbotshall chert.

intrusive lithologies in the norseman region include:

¬ The Buldania granite that intrudes the penneshaw formation
¬ The pioneer granite and similarly poorly exposed domal granites that intrude the sequence along the western margin of the greenstone belt
¬ felsic porphyry to granitoid dykes that intrude all units and predate mineralisation
¬ proterozoic mafic dykes that occupy a yilgarnwide set of linear brittle fractures

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Independent Geologist’s Report (continued)

The rocks of the norseman area can be broadly correlated with the stratigraphy of the Kalgoorlie-Kambalda region. Woolyeenyer formation mafic volcanic rocks, internally separated stratigraphically by the informally named Talbot island ultramafic unit, can be correlated with the lower basalt-komatiite-upper basalt sequence of the KalgoorlieKambalda region. The sediment-dominated mt Kirk formation can similarly be correlated with the Black flag Beds.

The structural/tectonic history of the norseman area involved at least two phases of extension that were followed by regional shortening episodes.

metamorphic grade in the greenstone sequence at norseman varies from upper greenschist facies within the central part of the greenstone belt, around lake cowan, to middle amphibolites facies to the south where the greenstone sequence is highly attenuated between granite intrusions. alteration assemblages associated with gold mineralisation vary with the metamorphic grade of host lithologies. ductile deformation of gold bearing quartz veins and alteration haloes implies that norseman mineralisation formed pre or syn-deformation and high temperatures.

2. Project Geology

a) Peninsula Gold Project

The geology of the tenement area predominantly consists of mafic komattitic basalts and ultramafic lithologies with flow tops identifiable in a number of localities. interbedded within these lithologies are bands of tuffaceous felsic sediments and cherts as well as carbonaceous shales and pyritic sediments.

This sequence is bounded to the east and west by acid volcaniclastic extrusives, greywackes, shales and conglomerates. regionally the project area lies within the fold closure of a gently north plunging anticline. The strike of the rock sequence is approximately north-south with steep easterly dips.

b) Beete Gold Project

lithologies of the project comprise of east dipping archean metamorphosed tuffs, sediments and greenstones including gabbro, basalt and ultramafics. strike is slightly east of north. The Beete sequence is regarded as being an extension of norseman rocks. younger granites and pegmatites extensively intrude greenstones to the east.

3. Mineralisation

gold won from the norseman region has principally been from narrow, generally north-south striking, east dipping quartz veins hosted by biotite altered and sheared mafic and ultramafic lithologies of the Woolyeenyer formation. minor mineralisation occurs as sulphidation systems within the upper banded iron units of the noganyer formation.

The dominant control on gold mineralisation in the norseman region is large north striking shear zones and tensional veins linking the north-south structures. Within the main shear zones and tensional veins, mineralisation can occur as numerous surfaces that are variably deformed.

a) Peninsula Gold Project

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Figure 3: South Decline Portal - Peninsula Gold Project

mineralisation at peninsula is associated with north-south trending quartz veins which dip at angles of 60 to 80 degrees to the east. a major quartz reef extends for the length of the tenement and has been previously worked in the late 1800’s and intermittently throughout the 1900’s. along the strike within the project area a total of five shafts have been sunk. geologically the reef system becomes more complex towards the north. at the north end of the tenement the main reef appears to have been faulted with sinistral displacement of the northern block. The geology is made additionally complicated by drag folding associated with ductile deformation.

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Independent Geologist’s Report (continued)

historical records state that up until 1898 “195 metres of driving had been completed and that two chutes of stone were passed through, one being 30 metres and the other 21 metres in extent. The larger shute dips north gently and thus extends towards the centre of the property. in the drives (at the 47 metre level) the quartz was very rich but the stopes above the level have proved the gold to be very irregularly distributed through the reef and rock accompanying it.” (norseman directory)

b) Beete Gold Project

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Figure 4: Eldridge Mine inclined Shaft at the Beete Gold Project

gold mineralisation is hosted within a narrow quartz vein and occasionally within the adjacent hanging and / or footwall shear. a fairly persistent milky quartz vein which occurs below the mineralised quartz vein provides a useful marker horizon. The veins conform closely to the attitude of the host lithologies. considerable local variations of dip occur within the mineralised area.

D. Historical Workings

1. Peninsula Gold Project

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Figure 5: Peninsula Mine Cross SectIon

underground mining was halted due to the erratic distribution of gold mineralisation and a lack of understanding of the controls on mineralisation. it has been described by more recent workers that “gold mineralisation occurs in sheet like plunging shoots”.

The “southern decline” was initiated in 1984 following a feasibility study by australis mining nl, to commence development on mineralisation. mineralisation had been previously delineated by cngc in 1982.

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Independent Geologist’s Report (continued)

2. Beete Gold Project

gold was first discovered at the Beete gold project by prospector h. eldridge in 1958. gold was produced during the years of 1958-1965, 1968, 1974 and 1976. production records are not available for 1970 to 1974. subsequent to 1974 a total of 2,816 tonnes of ore averaging 24.8g/t au was mined for more than 2,300 ounces.

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Figure 6: Historic Stope at Eldridge Mine (Beete Gold Project)

mining ceased at the southern end of the underground workings where mineralisation widths became untenable. sampling has indicated high grade material on no. 3 level. evidence throughout the mine suggests that variable widths of mineralisation occur over short distances, creating potential for extra resource inventories within close proximities of known terminations of lode. The structural controls on lode widths have not been fully appreciated by previous owners and may provide upside for future work. mining appears to have ceased at the northern end of the underground workings, also due to narrowing and anastomosing mineralisation.

it can be seen from historical workings in figure 6 that stoping activities broke through to surface.

E. Previous Exploration

1. Peninsula Gold Project

cngc has conducted a significant amount of on ground exploration including a total of 44 rotary percussion, reverse circulation and diamond drill holes for 3,695m of drilling. a decline was developed in the south of the project area in order to exploit this mineralisation. in 1984 australis mining established a decline to the north in order to exploit mineralisation to the north of the main shaft.

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Figure 7: Peninsula Project Collar Plan

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Figure 8: Peninsula Mine Long Section 389,150mE with significant intercepts

australis mining limited completed 15 rotary air Blast percussion holes for 452 metres of drilling in 1984. significant results of this drilling are listed below in Table 1: raB results- australis mining 1984. it has been noted by both cngc and australis mining limited that the northern extent of the project area was found to be geologically complicated.

Table 1: raB results, australis mining limited, northern decline area, 1984

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HOLE EAST NORTH AzIMUTH DIP FROM TO INTERVAL AU G/T
84p8 389172 6463438 270 -45 29 30 1 1.07
84p10 389172 6463463 0 -90 9 11 2 7.09
84p10 389172 6463463 0 -90 18 20 2 4.50
84p12 389172 6463476 270 -45 25 28 3 1.80
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2. Beete Gold Project

prior to 1989 it was generally accepted that the project area was underlain by proterozoic lithologies of the albany-fraser province. Between 1989-93, studies conducted by gsWa (formerly W.a. geological survey) and agso (australian geological survey organisation) reinterpreted the area to be an extension of the archean yilgarn craton. This reinterpretation determined that magnetic signatures of rocks within the project area were common in both amplitude and attitude to the north-south trending fabric displayed by the norseman archean greenstone Belt to the north rather than the north-east trend of the proterozoic albany fraser province. This interpretation was subsequently supported in 1995 by age dating evidence which allocated an archean age of 2600-2700 million years to rocks within the project area.

demonstration of the project area and its surrounds to be archaean in age considerably increased the prospectivity of a large region for gold and nickel deposits. during 1979 and 1980 cngc established a grid over the area, cut and sampled several costeans, performed a resistivity survey over a portion of the area, flew aerial magnetics and drilled a single percussion hole. costeans by cngc indicate a zone of fracturing, mineralisation and quartz/felsic intrusives cross-cutting the country rocks, coincident with air photo lineations identified in an east-west direction, just north of the mine workings.

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Independent Geologist’s Report (continued)

F. Exploration Targets

a) Peninsula Gold Project

The significant level of historical exploration and historical mining activities will require considerable desktop analysis in order to adequately utilise available data. preliminary review of current data shows a number of possible opportunities exist to extend the known mineralised area both along strike and at depth. drilling to the north and south of the peninsula mine has indicated that mineralisation extends beyond the area of the existing workings. significant intercepts include:

Table 2: drilling results, central norseman gold corporation, 1982

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HOLE EAST NORTH DIP AzI FROM TO INTERVAL AU G/T
pen21 389161.4 6463075 -60 270 66.5 70.36 3.86 3.83
pen21 389161.4 6463075 -60 270 74 77.86 3.86 5.11
pen20 389206.3 6463075 -60 270 169 172.3 3.3 7.99
pen20 389206.3 6463075 -60 270 196.4 197.7 1.3 43.76
pen11 389163.7 6463104 -60 270 64.66 65.2 0.54 7.2
pen24 389149.4 6463104 -60 270 70.75 71.44 0.69 2.45
pen24 389149.4 6463104 -60 270 83 83.74 0.74 1.25
pen11 389163.7 6463104 -60 270 100 101.53 1.53 4.29
pen11 389163.7 6463104 -60 270 117 117.82 0.82 0.69
pen9 389187.3 6463103 -60 270 156 159.15 3.15 17.5
pen15 389213.9 6463157 -60 270 173.2 173.98 0.78 2.15
pen12 389226.7 6463104 -60 270 217.12 218.7 1.58 1.41
pen12 389226.7 6463104 -60 270 231.75 234.11 2.36 2.8
pen25 389128 6463127 -60 270 36.5 39.42 2.92 6.59
pen26 389142.9 6463129 -60 270 58.5 59.27 0.77 1.9
pen53 389144.6 6163130 -60 270 73.15 73.54 0.39 1.57
pen26 389142.9 6463129 -60 270 175.5 176.27 0.77 1.25
pen18 389206.3 6463127 -60 270 180.5 181.28 0.78 1.67
pen18 389206.3 6463127 -60 270 185.36 187.2 1.84 0.94
pen18 389206.3 6463127 -60 270 200 200.52 0.52 2.6
pen39 389143.2 6463156 -60 270 53.65 54.15 0.5 4.85
pen27 389141 6463156 -60 270 56 56.82 0.82 1.36
pen27 389141 6463156 -60 270 65.85 67.49 1.64 1.32
pen39 389143.2 6463156 -60 270 68.3 72.3 4 3.34
pen3 389190.8 6463315 -60 270 108.5 109.01 0.51 7.83
pen3 389190.8 6463315 -60 270 143.9 144.27 0.37 1.04
pen4 389215.9 6463314 -60 270 187.85 188.11 0.26 10.8
pen4 389215.9 6463314 -60 270 207.36 207.57 0.21 2
pen29 389166.9 6463328 -60 270 47.58 49.23 1.65 11.36
pen29 389166.9 6463328 -60 270 56.12 57.6 1.48 2
pen30 389180.1 6463328 -60 270 56.12 57.6 1.48 1.35
pen30 389180.1 6463328 -60 270 89.04 89.77 0.73 2.2
pen30 389180.1 6463328 -60 270 117.08 117.82 0.74 1.9
pen57 389166.2 6463346 -60 270 37.82 38.46 0.64 1.4
pen31 389170.9 6463362 -60 270 46.36 47.16 0.8 15.25
pen31 389170.9 6463362 -60 270 47.96 48.76 0.8 5.8
pen33 389153.7 6463399 -60 270 81.74 82.66 0.92 4.98
pen34 389142.4 6463398 -60 270 85.18 87.91 2.73 1.85
pen34 389142.4 6463398 -60 270 96.34 97.25 0.91 1.05
pen34 389142.4 6463398 -60 270 102.44 105.17 2.73 3.22
pen34 389142.4 6463398 -60 270 132.94 134.78 1.84 1.58
pen44 389141.6 6463423 -60 270 21.96 22.91 0.95 2.05
pen44 389141.6 6463423 -60 270 29.28 30.23 0.95 22
pen44 389141.6 6463423 -60 270 32.94 33.89 0.95 1.13
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Independent Geologist’s Report (continued)

b) Beete Gold Project

The Beete gold project has a considerable amount of historical exploration data and historical workings which require detailed analysis. previous workers of the workings have documented that a shoot control exists within the mineralised sequence which strongly influences the distribution of high grade mineralisation. By generating a three dimensional geological model of the project data, it is envisaged that this shoot control can be further defined. in order to test the geological model a combination of geological mapping, surface sampling and shallow drilling will be required.

G. Planned Project Expenditure

a) Peninsula Gold Project:

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b) Beete Gold Project:

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Independent Geologist’s Report (continued)

IV. CRAWFORD PROJECT

A. Location and Access

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Figure 9: Crawford Project Location Plan

The main access to the area is via the Williambury-mt sandiman road. Various station tracks occur across the project area. a grid cut by crae provides access across the crawford project area.

B. Climate and Vegetation

The gascoyne region has a moderate arid-tropical climate with less of the climatic extremes that are felt to the north and south of the region. around three hundred and twenty days of sunshine occur each year.

rainfall in the gascoyne is highly variably, averaging 200 millimetres per year. The majority of this rainfall occurs during cyclonic activity and thus is a function of the number of cyclones that affect the region during the cyclone season.

The gascoyne region is almost entirely covered by semi-arid shrub varieties with little or no tree cover. significant tracts of natural vegetation such as spinifex (Triodia), Wattle (acacia) and poverty Bush (eremophila) remain intact.

C. Geological Setting and Mineralisation

1. Regional Geology

The crawford Belt represents an inlier of the proterozoic morrissey metamorphics surrounded by intrusive granitoids. The belt itself has been intruded by various granitoids apparently related to the minnie creek Batholith. mapping conducted by the gsWa shows the morrissey metamorphics to be a sequence of quartz-muscovitebiotite-sericite schists and quartz-muscovite-biotitegarnet-andalusite schists. included in the sequence are also minor amphibolites and quartzite units. These amphibolites and quartzite units have been intruded by two generations of granitoid.

The belt is transected by a major shear zone, 2-3km wide, which trends in a WnW-ese direction across the region, deforming both granitoids and morrissey metamorphics (archibald, 1994). a number of north-striking gabbroic dykes occur to the east, typically within the granitoid lithologies (Williams, 1993). numerous quartz blows intersperse the land surface throughout the project area.

2. Project Geology

The crawford Bore project is underlain by proterozoic metamorphic rocks of the morrissey metamorphic suite. The project is centred on an ese striking belt of biotitechlorite-white mica schist that also include porphyroblastic garnet, staurolite, andalusite, tourmaline and magnetite at various locations.

a) Lithologies

The crawford project consists of a series of metasediments, meta igneous rocks, tourmalinites, quartz veins and gabbroic dykes. metasediments are described as being pelitic to semi pelitic, strongly foliated schists.

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meta igneous bodies within the project are predominantly granitic to granodioritic in composition with minor amphibolite dykes. granitoids are medium to coarse grained and almost all preserve the original foliation. Variability of fabric in the granitoids is related to the timing of intrusion with respect to the dominant deformation regimes.

Tourmalinite outcrops are scattered across the crawford project. The tourmalinites are found both cross cutting and parallel to the dominant foliation. They are often linear features that extend for up to 30m and a maximum of 10m in diameter. late tourmalinite veins are easily identifiable as they are clearly associated with quartz veins. large quartz blows and vein systems run approximately north-south are most likely associated with the north-south trending system of faults due to late stage brittle deformation. less abundant and much smaller scale quartz veins appear as deformed lenses within the sediments parallel to the s1 foliation. extensive gabbroic dykes similarly trend north-south, intruding into these late stage faults.

b) Structure

numerous large and small scale faults occur within the project area. The large scale faults trend approximately east-west displacing the prominent steeply dipping, north-south trending faults frequently marked by either gabbroic dykes or quartz blows. in some places the north-south trending faults are associated with a chloritic zone. The fault system is extensive and rather complex; some faults appear as conjugate fault sets, showing dextral sense of movement, others of similar orientation show no offset. The faults are a late feature as they crosscut all other foliations and rock textures.

3. Mineralisation

D. Previous Exploration

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Figure 10: Crawford Project Geochemical Sampling

historically, exploration in the region has been conducted by White & White (1991), cra ltd (1993), pasminco (1994) and matlock (1995).

The crawford Bore-nicks bore area was first pegged by o.J. White in the late 1980’s for corundum. further prospecting in the area led to the discovery of tourmalinite veins, often hosting localized gossan development with significant base and precious metals anomalies. copperlead- zinc mineralisation has been identified in outcrops around crawford’s Bore, to the south of nick Bore, and a few kilometres to the south east of crawford’s Bore.

cra ltd (“cra”) optioned the ground and carried out an exploration program involving gridding, stream sediment geochemistry, airborne magnetic / radiometrics and a wide spaced ip survey. a large chargeability plus resistivity anomaly was drilled via four rc percussion holes. all produced disappointing results. cra withdrew from the Joint Venture in January 1993. it should be noted that the cra exploration program did not follow up on tourmalinite occurrences, as at the time they were not considered to be economically viable targets.

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Independent Geologist’s Report (continued)

pasminco exploration conducted an assessment of the crawford Belt in march 1994. nick archibald (consulting geologist) was commissioned to conduct an initial assessment of the prospectivity of the crawford Belt for “Broken hill Type” base metal mineralisation. in the concluding statement of his report it was suggested that on a comparative basis with more generalised models for mineralisation hosted in proterozoic high grade terrains, the crawford Belt is unlikely to host base metal mineralisation.

favourable stratigraphic horizons within the package demonstrate anomalous geochemical signatures that warrant follow up.

further to this work pasminco also commissioned a geologist to conduct three weeks worth of mapping of the project. attention was paid to structural and lithological detail. petrological and magnetic susceptibility studies were carried out. The geochemical data obtained from their study did not reproduce the high base metal values associated with tourmalinites and gossanous material obtained by White and White (1991). The field and petrographic evidence suggested to them that tourmaline

occurrences and the various tourmalite base metal veins are genetically related to granitic intrusives in the area. further, they found no evidence to support the possibility of significant stratiform/stratabound base metals mineralisation within the area.

matlock mining nl conducted reconnaissance mapping of the tenement area. reconnaissance soil sampling with a follow up detailed soil sampling campaign was conducted over anomalous area. Targets were further investigated by detailed mapping and sampling.

E. Exploration Targets

The crawford project represents a poly metallic exploration target which has been subject to limited modern systematic exploration. in order to understand the controls on mineralisation a desktop analysis and geophysical based modelling program is proposed. Through a combination of the desktop analysis and geophysical modelling a three dimensional geological model for the region will be generated. structural and lithological targets will be tested using geochemical sampling methods.

F. Planned Project Expenditure

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ACTIVITY YEAR 1 YEAR 2 TOTAL
desktop data compilation $25,000 - $25,000
geophysical modelling $15,000 - $15,000
gravity survey $50,000 - $50,000
geochemical sampling - $50,000 $50,000
geological personnel $30,000 $30,000 $60,000
TOTAL $120,000 $80,000 $200,000
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Independent Geologist’s Report (continued)

V. Declarations by BMGS J& l morton report on operations on mining tenement number p63/871, period A. Independence 15/01/92 to 14/01/93, 1993 Bmgs is an independent consulting and advisory J& l morton report on operations on mining organisation which provides a range of services related to tenement number p63/871, period the minerals industry including, in this case, independent 12/01/94 to 11/01/95, 1995 geological services, but also resource evaluation, audit, due J& l morton combined annual mineral exploration diligence and risk assessment assistance. The authors of report Beete e63/437, p63/686, this report declare that they have no material interest in p63/716-717, p63/871 period covered Terranova minerals, its associated entities or the assets 1 January 1995 to 31 december 1995, described in this report. Bmgs has charged Terranova 1996 minerals a professional fee for services rendered, the quantum of which is unrelated to the outcome or the J& l morton new Beete gold project, norseman Wa, content of this report. The independent geologists report e63/829, 14/11/04-13/11/05, 2006 has been prepared on information available up to 5 June 2011. no author annual report exploration licence e09/274, for the year ending 6/2/91, B. Qualifications nealon, e.f.g. an assessment of the peninsula gold This igr has been compiled by mr Ben pollard, B.sc mine, norseman, Wa for australis (mineral exploration and mining geology). mr pollard is a mining. January, 1984 (unpublished) geologist with 15 years experience in the resources robinson, p. pan australian exploration pty ltd, industry having held roles with various mining companies yilgarn extension project, group 7, exposed to precious and base metals and industrial e63/435, e63/437, p63/686, p63/716, minerals. mr pollard currently holds the role of principal p63/717, p63/738, p63/739, p63/871, geologist with Bmgs perth, and is a member of the Beete project area, 1 march 1996 to 28 australasian institute of mining and metallurgy, and has the appropriate relevant qualifications, experience, february 1997, 1997 competence and independence to be considered an robinson, p. pan australian exploration pty ltd, “expert” under the definitions provided in the Valmin code yilgarn extension project, group 7, and a “competent person” as defined in the Jorc code. e63/435, e63/437, e63/583, p63/686 (m63/310), p63/716, p63/717, VI. Bibliography p63/738, p63/739, p63/871, Beete project area, 1 march 1998 to 28 caTlin, a. The norseman gold Belt 1899 february 1999, 1999 fripp exploration and geology of peninsula Washausen, g exploration and geology of the prospecting licences, p63/200-202, peninsula prospecting licences dundas mineral field, Western p63/200-202, dundas mineral field, australia, annual report to 17th Western australia, annual report to January 1986 17th January, 1987 hall, K.m. The peninsula gold mine- norseman Washausen, g exploration and geology of the open cut mining mareeba mining peninsula prospecting licences memorandum, 24th may, 1984 p63/200-202,dundas mineral field, Western australia, annual report to hoppe, f.e.p annual report peninsula gold project, m63/2319, norseman, Western 17th January, 1988 australia, 1st January 1984 to 31st White, o.J & W.r. Tindals gold mines nl, crawford’s Bore december 1984, 1985 project, surrender report e09/494-95, J& l morton Beete gold mine - p63/686: farm-in e09/538, e09/691, m09/34, m09/64, m09/70, 1996 completion report: on completion of rehabilitation, 1993

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Independent Geologist’s Report (continued)

White, o.J & W.r. matlock mining nl, crawford’s Bore project, annual Technical report for e09/494-95, e09/538, e09/691, m09/34, m09/64, m09/70, for the period 1/7/1994 to 30/6/1995 Williams, V. a. crae pty ltd, partial surrender report crawford 2 el09/274, Western australia, 1993

Williams, V. a. crae pty ltd, e09/274, e09/494-95, e09/538, p09/263, p09/265, ml09/34, ml09/64, crawford Joint Venture, report on activities for the year ending 31st march 1993
Zakowski, s. crae pty ltd, e09/274, e09/494-95, e09/538, p09/263, p09/265, ml09/34, ml09/64, m09/70 crawford Joint Venture, report on activities for the year ending 30/06/94
VII. Glossary of Abbreviations and Technical Terms

airborne a survey undertaken by helicopter or magnetics fixed wing aircraft for the purpose of recording magnetic characteristics of rocks by measuring deviations of the earth’s magnetic field

alteration The change in the mineral composition of a rock, commonly due to hydrothermal activity

amphibolite a rock consisting mainly of amphibole and plagioclase with little or no quartz
amphibolite an assemblage of minerals formed at facies moderate to high temperatures metamorphism (450-700oc) during regional metamorphism
andalusite a alumino silicate mineral anticline a fold in the rocks in which strata dip in opposite directions away from the central axis
archaean The oldest rocks of the precambrian era, older than about 2,500 million years
au gold azimuth The horizontal angle of a direction measured clockwise from north

a volcanic rock of low silica (<55%) and high iron and magnesium composition, composed primarily of plagioclase and pyroxene

Basalt

Batholith a large composite intrusion with a surface area of >100km
Biotite a brown/green phyllosilicate mica
metal used for low temperature melt solders
Bismuth
Boxwork a honeycomb like structure found commonly in gossans which form when residual limonite remains in the cavity resulting when a sulphide grain is oxidised
Brittle rock deformation characterised by deformation brittle fracturing and brecciation
carbonaceous descriptor for a lithology with a high carbonate (co3) content
chargeability a measure of induced polarisation in anomaly time domain methods equal to the area under the time-decay voltage curve over a given time period
chert fine grained sedimentary rock composed of cryptocrystalline silica
concordant
With margins parallel to the bedding or foliation of the country rock
conglomerate a rudite with rounded clasts larger than 2 mm
contact The boundary between two discrete rock types

costean a trench excavated for the purposes of attaining geological and or geochemical information deformation a geological process in which the application of force causes a change in geometry such as the production of a fold, fabric or fault

diamond drilling mineral exploration hole completed using a diamond set or diamond impregnated bit for retrieving a cylindrical core of rock

dip The inclination of a planar surface, measured in the vertical plane perpendicular to its strike

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Independent Geologist’s Report (continued)

drag folding	a minor parasitic fold, probably formed	intrusion	a body of igneous rock that has forced
	by shear in an incompetent layer		itself into pre existing rocks
	between two competent layers folded by fexural slip	ip survey	induced polarisation- an electrical geophysics exploration survey method
ductile	deformation of rocks or rock structures		based on the production of electric
deformation	involving stretching or bending in a		charge displacement brought about by
	plastic manner without breaking		application of an electric or magnetic
dykes	a tabular body of intrusive igneous		feld
	rock, cross cutting the host strata at a	Komatiite	an ultramafc volcanic rock with >18%
	high angle		mgo composed of olivine and pyroxene
fabric	The pervasive features of a rock		in a glassy or devitrifed groundmass. it has a distinctive spinifex texture.
felsic	an adjective indicating that a rock contains abundant feldspar and silica	limonite	a general term for hydrated iron oxide mineral
foliation	Banded rocks, usually due to crystal fractionation as a result of metamorphic processes	lithology	a description of the macroscopic features of a rock type
foot wall	The wall lying beneath a horizontal or inclined fault or orebody	mafc	a general term for ferro magnesian minerals
g/t	grams per tonne, a standard volumetric unit for demonstrating the concentration of precious metals in a	magnetite	a mineral comprising iron and oxygen which commonly exhibits magnetic properties
	rock	metamorphic	The extent to which a rock has been
garnet	a cubic mineral characteristic of metamorphic rocks, but also found in some igneous rocks and as detrital	grade	altered by physical and chemical processes involving heat, pressure and derived fuids
	grains in sediments	mineralisation	anomalous concentration of an
gossan	a mass of limonite and gangue resulting from the oxidation by		element or mineral of economic interest
	percolating surface waters of outcrops	muscovite	a very common white mica
	of sulphide deposits	pegmatite	a very coarse grained intrusive igneous
granite	a coarse grained igneous rock		rock which commonly occurs in dyke
	containing mainly quartz and feldspar		like bodies containing lithium-boron-
	minerals and subordinate micas		fuorine-rare earth bearing minerals
greenschist	a metamorphosed basic igneous rock	plunge	The angle between a linear structure
	which owes it colour and schistosity to		and a vertical plane
	abundant chlorite	pluton	a large thick, igneous body with steep
greenstone Belt	a broad term used to describe elongate		lateral contacts which was emplaced
	belt of rocks that have undergone		and crystallised beneath the surface,
	regional metamorphism to greenstone		possibly now exposed as an irregular
	facies		polygonal outcrop
greywackes	a sandstone like rock, with grains	porphyry	Bimodal crystal distribution; larger
	derived from a dominantly volcanic		crystals set in a fne ground mass
	origin	proterozoic	The younger eon of the precambrian
hanging Wall	The mass of rock above a fault, vein or zone of mineralisation	pyrite	The most common sulphide mineral (fes2)

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Independent Geologist’s Report (continued)

Quartz The most common silica mineral (sio2) staurolite a neosilicate found in aluminium rich rocks subjected to regional scale Quartzite a metamorphic rock usually formed by metamorphism metamorphism of a sandstone stope an excavation within an underground raB drilling a relatively inexpensive and less mine built to extract ore accurate drilling technique involving the collection of sample returned by stratigraphy The study of layered sedimentary or compressed air from outside of the drill metamorphic rocks, especially their rods relative ages and correlation between different areas radiometrics geophysical exploration method for the location of radioactive elements, in stratabound a layer restricted to a small practice uranium, potassium and stratigraphic range in a group of strata Thorium stratiform a layer with a lateral extent parallel to rc drilling a drilling method in which the the principal planar structure such as fragmented sample is brought to the bedding or an igneous lamination, of surface inside the drill rods, thereby limited thickness reducing the level of contamination strike horizontal direction or trend of a reef old mining term used to describe large geological structure quartz veins Tension Veins a vein forming in a rock whereby the resistivity The anomalous voltage difference opening was developed under tensile anomaly measured between two electrodes conditions which have a current transmitted Tourmaline a complex cyclosilicate found in granite between them in the ground pegmatite and as an accessory mineral sandstones a clastic sedimentary rock with >25% in igneous and metamorphic rocks by volume clasts of sand grade Tourmalinites a lithology with a high tourmaline (0.625-2mm) mineral content usually associated with schist a crystalline metamorphic rock having medium to high temperature a foliated or parallel structure due to mineralisation the recrystallisation of the constituent Tuff a volcanic sediment minerals ultramafic igneous rocks consisting essentially of sedimentary a term describing a rock formed of ferromagnesian minerals with trace sediment quartz and feldspar sericite a white or pale apple green potassium Volcanic formed or derived from a volcano mica, very common as an alteration product in metamorphic and Volcaniclastic pertaining to clastic rock containing hydrothermally altered rocks volcanic material shale a fine grained, laminated sedimentary yilgarn Block mass of rock formed during the rock formed from clay, mud and silt archaean period shear a zone in which rocks have been deformed primarily in a ductile manner in response to an applied stress siltstones fine grained, sedimentary rock with a grain size between sand and clay sinistral The sense of movement across a boundary, such as a fault, in which the side opposite to the observer moves to the left

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Investigating Accountant’s Report

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Tel: +61 8 6382 4600 fax: +61 8 6382 4601 www.bdo.com.au

38 station street subiaco, Wa 6008 po Box 700 West perth Wa 6872 australia

21 June 2011

The directors Terranova minerals nl level 8, 225 st georges Terrace perTh Wa 6000

dear sirs

INVESTIGATING ACCOUNTANT’S REPORT

1. INTRODUCTION

We have prepared this investigating accountant’s report ( “Report” ) on historical financial information of Terranova minerals nl ( “Terranova” or “the Company” ) for inclusion in the prospectus. Broadly, the prospectus will offer 20 million shares at an issue price of $0.20 each to raise up to $4 million before costs ( “the Offer” ). This is the minimum subscription. oversubscriptions of up to a further 2.5 million shares at an issue price of $0.20 each to raise up to an additional $500,000 may be accepted.

expressions defined in the prospectus have the same meaning in this report.

2. BASIS OF PREPARATION

This report has been prepared to provide investors with information on the statement of comprehensive income, statement of changes in equity and the statement of financial position and the pro-forma statement of financial position as noted in appendices 1, 2 and 3.

This report does not address the rights attaching to the shares to be issued in accordance with the prospectus, nor the risk associated with the investment, and has been prepared based on the complete offer being achieved. neither Bdo corporate finance (Wa) pty ltd nor its related entities ( “BDO” ) has not been requested to consider the prospects for the company, the shares on offer and related pricing issues, nor the merits and risks associated with becoming a shareholder and accordingly has not done so, and does not purport to do so. Bdo accordingly takes no responsibility for these matters or for any matter or omission in the prospectus, other than responsibility for this report. risk factors are set out in the prospectus.

3. BACKGROUND

Terranova was incorporated on 25 January 2011. it is an australian based exploration company established primarily to acquire, explore, evaluate and exploit mineral resource projects including gold, bismuth and copper minerals at the Beete gold mine and peninsula gold project ( “Red Field Tenements” ), both located in Western australia. The company has also applied for exploration licence e09/1899, known as the crawford project.

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Investigating Accountant’s Report (continued)

Acquisition Agreement

on or about 9 may 2011, the company entered into an acquisition agreement with red field pty ltd ( “Red Field” ), which currently owns 100% of both the Beete gold mine and peninsula gold project ( “Acquisition Agreement” ).

The consideration for the acquisition is as follows:

Within 5 business days from the execution of the acquisition agreement, the company will pay an amount of $25,000 payable in cash for the reimbursement of previous exploration expenses in relation to the red field Tenements;
at settlement, the company will pay an amount of $40,000 payable in cash for the reimbursement of previous exploration expenses in relation to the red field Tenements; and
at settlement, the company will issue 300,000 shares in Terranova to red field.

a condition of the acquisition agreement is that Terranova successfully completes the capital raising and obtains conditional approval to list on the australian securities exchange ( “ASX” ).

4. SCOPE

you have requested Bdo to prepare an investigating accountant’s report covering the following financial information:

¬ Terranova’s reviewed statement of comprehensive income for the period from 25 January 2011, the date Terranova was incorporated, to 30 april 2011;
¬ the statement of financial position, statement of changes in equity and the pro-forma statement of financial position as at 30 april 2011 reflecting the actual position as at that date, major transactions between that date and the date of our report and the proposed capital raising under the prospectus; and
¬ the accounting policies applied by Terranova in preparing its financial statements.

The historical financial information set out in the appendices to this report has been extracted from the financial statements of the company for the period of incorporation to 30 april 2011.

The directors are responsible for the preparation of the historical financial information including determination of the adjustments.

We have conducted our review of the historical financial information in accordance with the australian auditing and assurance standard asre 2405 “review of historical financial information other than a financial report”. We made such inquiries and performed such procedures as we, in our professional judgment, considered reasonable in the circumstances including:

¬ a review of work papers, accounting records and other documents pertaining to balances in existence at 30 april 2011;
¬ a review of the assumptions used to compile the pro-forma statement of financial position;
¬ a review of the adjustments made to the pro-forma historical financial information;
¬ a comparison of consistency in application of the recognition and measurement principles in accounting standards and other mandatory professional reporting requirements in australia, and the accounting policies adopted by the company disclosed in the appendices to this report; and
¬ enquiry of directors and others.

These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance provided is less than given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

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Investigating Accountant’s Report (continued)

our review was limited primarily to an examination of the historical financial information, the pro-forma financial information, analytical review procedures and discussions with both management and directors. a review of this nature provides less assurance than an audit and, accordingly, this report does not express an audit opinion on the historical information or pro-forma financial information included in this report or elsewhere in the prospectus.

in relation to the information presented in this report:-

¬ support by another person, corporation or an unrelated entity has not been assumed;
¬ the amounts shown in respect of assets do not purport to be the amounts that would have been realised if the assets were sold at the date of this report; and
¬ the going concern basis of accounting has been adopted.

5. CONCLUSION

Statement on Historical Financial Information

Based on our review, which was not an audit, nothing has come to our attention which would cause us to believe the historical financial information as set out in the appendices to this report does not present fairly the financial performance for the period of incorporation to 30 april 2011 or the financial position as at 30 april 2011 in accordance with the measurement and recognition requirements (but not all of the disclosure requirements) of applicable accounting standards and other mandatory professional reporting requirements in australia.

Statement of Pro-forma Financial Information

Based on our review, which was not an audit, nothing has come to our attention which would cause us to believe the pro-forma financial information does not present fairly the financial position of the company as at 30 april 2011, in accordance with the measurement and recognition requirements (but not all of the disclosure requirements) of applicable accounting standards and other mandatory professional reporting requirements in australia as if the pro-forma transactions had occurred on that date.

6. SUBSEqUENT EVENTS

apart from the matters dealt with in this report, and having regard to the scope of our report, to the best of our knowledge and belief, no other material transactions or events outside of the ordinary business of the company have come to our attention that would require comment on, or adjustment to, the information referred to in our report or that would cause such information to be misleading or deceptive.

The pro-forma statement of financial position reflects the following events that have occurred subsequent to the period ended 30 april 2011:

¬ The payment of $25,000 for the reimbursement of previous exploration expenses in relation to the red field Tenements as per the acquisition agreement.

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Investigating Accountant’s Report (continued)

7. ASSUMPTIONS ADOPTED IN COMPILING THE PRO-FORMA STATEMENT OF FINANCIAL POSITION

The pro-forma statement of financial position post issue is shown in appendix 2. This has been prepared based on the reviewed financial statements as at 30 april 2011 and the transactions and events relating to the issue of shares under this prospectus:

¬ The issue of 20 million shares at an issue price of $0.20 cents per share to raise $4 million;
¬ capital raising costs of the offer totalling approximately $526,739 to be offset against contributed equity;
¬ The payment of $40,000 for the reimbursement of previous exploration expenses in relation to the red field Tenements as per the acquisition agreement; and
¬ The issue of 300,000 fully paid ordinary shares at $0.20 to red field as consideration for the acquisition of the red field Tenements under the acquisition agreement.

8. DISCLOSURES

Bdo corporate finance (Wa) pty ltd is the corporate advisory arm of Bdo in perth.

neither Bdo corporate finance (Wa) pty ltd nor Bdo, nor any director or executive or employee thereof, has any financial interest in the outcome of the proposed transaction except for the normal professional fee due for the preparation of this report.

consent to the inclusion of the investigating accountant’s report in the prospectus in the form and context in which it appears, has been given. at the date of this report, this consent has not been withdrawn.

yours faithfully

BDO Corporate Finance (WA) Pty Ltd

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Peter Toll

director

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Investigating Accountant’s Report (continued)

APPENDIX 1 TERRANOVA MINERALS NL

STATEMENT OF COMPREHENSIVE INCOME

	Reviewed for the period from 25-Jan11 to 30-Apr-11 $
interest income	-
expenses
Bank charges	(51)
company formation fees	(605)
nT uranium expenses	(16,989)
Loss before income tax expense	(17,645)
income tax beneft/(expense)	-
Net Loss for the period	(17,645)

The statement of comprehensive income is to be read in conjunction with the notes to and forming part of the historical financial information set out in appendix 4.

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Investigating Accountant’s Report (continued)

APPENDIX 2 TERRANOVA MINERALS NL

STATEMENT OF FINANCIAL POSITION

Reviewed

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as at Subsequent Pro-forma Pro-forma
30-Apr-11 Events Adjustments After issue
Notes $ $ $ $
CuRREnt ASSEtS
cash and cash equivalents 2 199,984 (25,000) 3,433,261 3,608,245
other current assets 1,699 - - 1,699
totAL CuRREnt ASSEtS 201,683 (25,000) 3,433,261 3,609,944
non CuRREnt ASSEtS
exploration expenditure 3 - 25,000 100,000 125,000
totAL non CuRREnt ASSEtS - 25,000 100,000 125,000
totAL ASSEtS 201,683 - 3,533,261 3,734,944
CuRREnt LiABiLitiES
Trade and other payables 24,592 - - 24,592
totAL CuRREnt LiABiLitiES 24,592 - - 24,592
non CuRREnt LiABiLitiES
loans and borrowings 605 - - 605
totAL non CuRREnt LiABiLitiES 605 - - 605
totAL LiABiLitiES 25,197 - - 25,197
nEt ASSEtS/(LiABiLitiES) 176,486 - 3,533,261 3,709,747
EQuitY
contributed equity 4 194,131 - 3,533,261 3,727,392
accumulated losses (17,645) - - (17,645)
totAL EQuitY 176,486 - 3,533,261 3,709,747
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The pro-forma statement of financial position after issue is as per the statement of financial position before issue adjusted for the transactions relating to the issue of shares pursuant to this prospectus. The statement of financial position is to be read in conjunction with the notes to and forming part of the historical financial information set out in appendix 4.

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Investigating Accountant’s Report (continued)

APPENDIX 3 TERRANOVA MINERALS NL

STATEMENT OF CHANGES IN EqUITY

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Reviewed for the
period ended Subsequent Pro-forma Pro-forma
30-Apr-11 Events Adjustments After issue
Notes $ $ $ $
Balance as at 25 January 2011
Comprehensive income for the period
profit/(loss) for the period (17,645) - - (17,645)
- -
total Comprehenisve income (17,645) (17,645)
for the period
Transactions with equity holders in
their capacity as equity holders
contributed equity, net of transaction
costs 4 194,131 - 3,533,261 3,727,392
Total transactions with equity holders 194,131 - 3,533,261 3,727,392
Balance 176,486 - 3,533,261 3,709,747
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The statement of changes in equity is to be read in conjunction with the notes to and forming part of the historical financial information set out in appendix 4.

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Investigating Accountant’s Report (continued)

APPENDIX 4 TERRANOVA MINERALS NL

NOTES TO AND FORMING PART OF THE HISTORICAL FINANCIAL INFORMATION

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies adopted in the preparation of the historical financial information included in this report have been set out below.

(a) Basis of preparation of historical financial information

The historical financial information has been prepared in accordance with the recognition and measurement, but not all the disclosure requirements of the australian equivalents to international financial reporting standards ( “AiFRS” ), other authoritative pronouncements of the australian accounting standards Board, australian accounting interpretations and the corporations act 2001.

The financial information has also been prepared on a historical cost basis, except for derivatives and availablefor-sale financial assets that have been measured at fair value. The carrying values of recognised assets and liabilities that are hedged are adjusted to record changes in the fair value attributable to the risks that are being hedged. non-current assets and disposal group’s held-forsale are measured at the lower of carrying amounts and fair value less costs to sell.

(b) Going Concern

The historical financial information has been prepared on a going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the normal course of business.

The ability of the company to continue as a going concern is dependent on the company being able to raise additional funds as required to meet ongoing commitments and for working capital. The directors may need to raise additional capital or realise assets as required to further explore and evaluate the current opportunities. The directors believe that the company will continue as a going concern. as a result the financial information has been prepared on a going concern basis. however should the company be unsuccessful in undertaking additional raisings or realising assets, the entity may not be able to continue as a going concern. no adjustments have been made relating to the

recoverability and classification of liabilities that might be necessary should the company not continue as a going concern.

(c) Reporting Basis and Conventions

The report is also prepared on an accrual basis and is based on historic costs and does not take into account changing money values or, except where specifically stated, current valuations of non-current assets.

The following is a summary of the material accounting policies adopted by the company in the preparation of the financial report. The accounting policies have been consistently applied, unless otherwise stated.

(d) Income Tax

The income tax expense or benefit (revenue) for the period is the tax payable on the current period’s taxable income based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax base of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses.

The charge for current income tax expenses is based on the profit for the year adjusted for any non-assessable or disallowed items. it is calculated using tax rates that have been enacted or are substantively enacted by the balance sheet date.

deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. no deferred income tax will be recognized 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 are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised.

The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the economic entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.

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Investigating Accountant’s Report (continued)

(e) Cash and Cash Equivalents

cash and cash equivalents includes cash at bank and in hand, deposits held at call with financial institutions, other short-term highly liquid deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position.

(f) Trade and other receivables

Trade receivables are recognised as the amount receivable and are due for settlement no more than 120 days from the date of recognition. collectability of trade receivables is reviewed on an ongoing basis. debts which are known to be uncollectible are written off against the receivable directly unless a provision for impairment has previously been recognised.

a provision for impairment of receivables is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. loans granted are recognised at the amount of consideration given or the cost of services provided to be reimbursed.

(g) Revenue Recognition

revenues are recognised at fair value of the consideration received net of the amount of gsT.

Interest

revenue is recognised as interest accrues using the effective interest method. The effective interest method uses the effective interest rate which is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial asset.

(i) Trade and Other Payables

liabilities are recognised for amounts to be paid in the future for goods or services received, whether or not billed to the company. Trade accounts payable are normally settled within 30 days of recognition.

(j) Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. any difference between proceeds (net of transaction costs) and the redemption amount is recognised in the statement of comprehensive income over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least 12 months after the statement of financial position date.

(k) Goods and Services Tax (GST)

revenues, expenses and assets are recognised net of gsT except where gsT incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the gsT is recognised as part of the cost of acquisition of the asset or as part of the expense item.

receivables and payables are stated with the amount of gsT included. The net amount of gsT recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of financial position.

cash flows are included in the statement of cash flow on a gross basis and the gsT component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authorities are classified as operating cash flows.

commitments and contingencies are disclosed net of the amount of gsT recoverable from, or payable to, the taxation authority.

(h) Provisions

provisions are recognised when the company has a present legal or constructive obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. provisions are not recognised for future operating losses.

(l) Exploration and Evaluation Expenditure

exploration and evaluation expenditure, including costs of acquiring the licences, are capitalised as exploration and evaluation assets on an area of interest basis. costs incurred before the company has obtained the legal rights to explore the area are recognised in the statement of comprehensive income.

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Investigating Accountant’s Report (continued)

exploration and evaluation assets are only recognised if the rights of the area of interest are current and either:

i. The expenditures are expected to be recouped through successful development and exploitation or from sale of the area of interest; or

Financial Assets

a financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset.

Non-Financial Assets

ii. activities in the area of interest have not at the reporting date, reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing.

exploration and evaluation assets are assessed for impairment if (i) sufficient date exists to determine technical feasibility and commercial viability, and (ii) facts and circumstances suggest that the carrying amount exceeds the recoverable amount. for the purpose of impairment testing, exploration and evaluation assets are allocated to cash-generating units to which the exploration activity relates. The cash generating unit shall not be larger than the area of interest.

once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are demonstrable, exploration and evaluation assets attributable to that area of interest are first tested for impairment and then reclassified to mining property and development assets within property, plant and equipment.

When an area of interest is abandoned or the directors decide that it is not commercial, and accumulated costs in respect of that area are written off in the financial period the decision is made.

(m) Impairment of assets

at each reporting date, the company 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 asset’s carrying value. any excess of the asset’s carrying value over its recoverable amount is expensed to the income statement.

impairment testing is performed annually for goodwill and intangible assets with indefinite lives. Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The carrying amounts of the non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. if any such indication exists then the asset’s recoverable amount is estimated. for goodwill and intangible assets that have indefinite lives or that are not yet available for use, recoverable amount is estimated at each reporting date.

an impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. a cash-generating unit is the smallest identifiable asset group that generates cash flows that largely are independent from other assets and groups. impairment losses are recognised in the statement of comprehensive income. impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other assets in the unit (group of units) on a pro rata basis.

(n) Property, plant and equipment

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

Plant & 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 which will be received from the assets employment and subsequent disposal. The expected net cash flows have not been discounted to their present values in determining recoverable amounts.

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Investigating Accountant’s Report (continued)

Depreciation

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

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

class of fixed asset depreciation rate plant and equipment over 2 to 10 years

The residual value, the useful life and the depreciation method applied to an asset are reassessed at least annually.

(o) Contributed Equity

ordinary shares are classified as equity.

costs directly attributable to the issue of new shares or options are shown as a deduction from the equity proceeds, net of any income tax benefit. costs directly attributable to the issue of new shares or options associated with the acquisition of a business are included as part of the purchase consideration.

(p) Financial Instruments

Recognition

financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. subsequent to initial recognition these instruments are measured as set out below.

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 stated at amortised cost using the effective interest rate method.

Financial liabilities

non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

(q) Employee Benefits

Wages and Salaries, Annual Leave and Sick Leave

liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within 12 months of the statement of financial position date are recognised in respect of employees’ services rendered up to statement of financial position date and measured at amounts expected to be paid when the liabilities are settled. liabilities for nonaccumulating sick leave are recognised when leave is taken and measured at the actual rates paid or payable. liabilities for wages and salaries are included as part of other payables and liabilities for annual and sick leave are included as part of employee Benefit provisions.

Long Service Leave

liabilities for long service leave are recognised as part of the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees to the statement of financial position date using the projected unit credit method. consideration is given to expect future salaries and wages levels, experience of employee departures and periods of service. expected future payments are discounted using national government bond rates at the statement of financial position date with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

Share-based payments transactions

The company provides benefits to employees (including directors) of the company in the form of share options. The fair value of options granted is recognised as an employee expense with a corresponding increase in equity. The fair value is measured at grant date and spread over the period during which the employee becomes unconditionally entitled to the options. The fair value of the options granted is measured using Black scholes valuation model, taking into account the terms and conditions upon which the options were granted.

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, on a straight line basis over the period from grant date to the date on which the relevant employees become fully entitled to the award (“vesting date”). The amount recognised as an expense is adjusted to reflect the actual number that vest.

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Investigating Accountant’s Report (continued)

The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share.

(r) Accounting estimates and judgements

in the process of applying the accounting policies, management has made certain judgements or estimations which have an effect on the amounts recognised in the financial information.

The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are:

Valuation of share based payment transactions

The valuation of share-based payment transactions is measured by reference to the fair value of the equity instruments at the date at which they are granted.

2. CASH AND CASH EqUIVALENTS

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Reviewed Pro-forma
30-Apr-11 After issue
$ $
cash and cash equivalents 199,984 3,608,245
Adjustments arising from the pro-forma cash balance are
summaraised as follows:
reviewed balance of Terranova at 30 april 2011 199,984
Subsequent events:
payment 1 of cash consideration per the acquisition
agreement (25,000)
(25,000)
Pro-forma adjustments:
proceeds from shares issued under this prospectus 4,000,000
capital raising costs (526,739)
payment 2 of cash consideration per the acquisition
agreement (40,000)
3,433,261
pro-forma Balance 3,608,245
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Investigating Accountant’s Report (continued)

3. EXPLORATION EXPENDITURE

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Reviewed Pro-forma
30-Apr-11 After issue
$ $
exploration expenditure - 125,000
Adjustments arising from the pro-forma exploration
expenditure are summaraised as follows:
-
reviewed balance of Terranova at 30 april 2011
Subsequent events:
payment 1 of cash consideration per the acquisition
agreement 25,000
25,000
Pro-forma adjustments:
payment 2 of cash consideration per the acquisition
agreement 40,000
issue of 300,00 shares to red field per the acquisition
agreement 60,000
100,000
pro-forma Balance 125,000
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4. CONTRIBUTED EqUITY

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Reviewed Pro-forma
30-Apr-11 After issue
$ $
exploration expenditure 194,131 3,727,392
number of shares
Adjustments arising from the pro-forma contributed equity
balance are summaraised as follows:
fully paid ordinary share capital at 30 april 2011 1 -
Pro-forma adjustments:
proceeds from shares issued under this prospectus 20,000,000 4,000,000
-
capital raising costs (526,739)
issue of 300,00 shares to red field per the acquisition
agreement 300,000 60,000
20,300,000 3,533,261
partly paid ordinary share capital at 30 april 2011 20,000,000 194,131
pro-forma Balance 40,300,001 3,727,392
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partly paid shares were issued at a price of $0.20 of which $0.01 was paid on issue. subject to the corporations act and the company’s constitution, the company shall only be entitled to make a call on the partly paid shares on the date which is one (1) day before the five (5) years from the date of issue of the partly paid shares. if a call is not paid when made, the partly paid shares shall be subject to forfeiture in accordance with the procedure set out in section 254Q of the corporations act.

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Investigating Accountant’s Report (continued)

NOTE 5: RELATED PARTY DISCLOSURES

Transactions with related parties and directors interests are disclosed in the prospectus.

NOTE 6: COMMITMENTS AND CONTINGENCIES

at the date of the report no other material commitments or contingent liabilities exist that we are aware of, other than those disclosed in the prospectus.

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08

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Solicitor’s Report on Tenements

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level 4, The read Buildings 16 milligan street perth Wa 6000

gpo Box 2799 perth Wa 6001

Telephone: +61 8 9321 4000 facsimile: +61 8 9321 4333

Web: www.steinpag.com.au

28 June 2011

The Board of directors Terranova minerals limited 1306 hay street WesT perTh Wa 6005

dear sirs

TERRANOVA MINERALS LIMITED: TENEMENT REPORT

This report is prepared for inclusion in a prospectus to be issued by Terranova minerals limited (acn 148 966 545) ( Company ) on or about 28 June 2011 for the issue of up to 20,000,000 shares at an issue price of $0.20 each in order to raise up to $4,000,000 (with the ability to accept oversubscriptions of up to a further 2,500,000 shares) ( Prospectus ).

1. ASSETS

The company entered into a sale of mining tenement agreement with red field pty ltd ( Red Field ) ( Red Field Agreement ) under which red field agreed to sell and the company agreed to purchase all of red field’s rights in prospecting licences p 63/1646 and p 63/1694 ( Red Field Tenements ). a summary of this agreement is included in section 10.1 of the prospectus.

The company has also applied for exploration licence e 09/1899 ( Company Tenement ).

The red field Tenements and company Tenement are together referred to as the Tenements in this report. a schedule of Tenements is attached to and forms part of this report ( Schedule ).

2. SEARCHES

for the purposes of this report, we have conducted searches and made enquiries in respect of the Tenements as follows:

(a) obtained searches of the Tenements from the registers maintained by the Western australian department of mines and petroleum ( DMP ). These searches were conducted on 24 June 2011.

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Solicitor’s Report on Tenements (continued)

(b) We have obtained extracts of registered native title claims and native title determinations that apply to the Tenements, as determined by the national native Title Tribunal ( NNTT ). This material was obtained on 24 may 2011. Key details on the status of the Tenements is set out in the Tenement schedule.
(c) We have reviewed all material agreements relating to the Tenements and summarised the material terms (details of which are set out in section 10.1 of the prospectus).

on the basis of the searches conducted, we consider that this report (and the schedule) provides an accurate statement as to the status of the Tenements as at the date the relevant searches were obtained.

3. OPINION

as a result of our searches and enquiries, but subject to the assumptions and qualifications set out below, we are of the view that, as at the date of the relevant searches:

(a) ( Company’s Interest ): this report provides an accurate statement as to the company’s interest in the Tenements;
(b) ( Good Standing ): this report provides an accurate statement as to the validity and good standing of the Tenements; and
(c) ( Third party interests ): this report provides an accurate statement as to third party interests, including encumbrances, in relation to the Tenements.

4. EXECUTIVE SUMMARY

subject to the qualifications and assumptions in this report, we consider the following to be material issues in relation to the Tenements:

(a) ( Company’s Interest ): The company does not have a registered interest in prospecting licences p 63/1646 and p 63/1694, the red field Tenements. it only has an equitable interest pursuant to the red field agreement.
(b) ( Transfer of interest ): a transfer of an interest in the red field Tenements to the company will depend on the company and other parties complying with the applicable terms of red field agreement. We express no opinion on whether the company will ultimately acquire an interest in the Tenements.
(c) ( Applications for Tenements ): The company has applied for but has not been granted exploration licence e 09/1899. We express no opinion on whether the company will ultimately be granted an interest in exploration licence e 09/1899.
(d) ( Rent ): rent currently due has been fully paid for the current tenement year for each granted Tenement. The rent for the tenement year ended 15 July 2012 for prospecting licence p 63/1694 will be due and payable by 15 July 2011. The Tenement schedule to this report provides details.
(e) ( Expenditure ): red field has complied with its minimum expenditure commitments in full for the last tenement year for the red field Tenements. The Tenement schedule to this report provides details.
(f) ( Conditions ): none of the Tenements are subject to unusual conditions of a material nature.
(g) ( Third party interests ): There are no third party dealings registered against the Tenements as at the date of our search of the dmp register.
(h) ( Material Contracts ): The company’s interest in the Tenements arises pursuant to the red field agreement.
(i) ( Native title ): native title claims are registered against the red field Tenements. further details are provided in schedule 2 of this report. The nnTT was unable to find any data for the exploration licence e09/1899. These native title claims could potentially prevent exploration and/or mining activities from taking place within certain parts of the Tenements.

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Solicitor’s Report on Tenements (continued)

5. DESCRIPTION OF THE TENEMENTS

The Tenements comprise exploration and prospecting licences granted or applied for under the Mining Act 1978 (Wa) ( Mining Act ). schedule 1 provides a list of the Tenements.

The following provides a description of the nature and key terms of these types of mining tenements as set out in the mining act.

5.1 Prospecting Licence

Application : a person may lodge an application for a prospecting licence in accordance with the mining act. The mining registrar or warden decides whether to grant an application for a prospecting licence. an application for a prospecting licence (unless a reversion application) cannot be legally transferred and continues in the name of the applicant.

Rights : The holder of a prospecting licence is entitled to enter the land and undertake operations for the purposes of prospecting for minerals.

Term : a prospecting licence has a term of 4 years. Where the prospecting licence was applied for and granted after 10 february 2006, the minister may extend the term by 4 years and if retention status is granted (as discussed below), by further term or terms of 4 years. Where a prospecting licence is transferred before a renewal application has been determined, the transferee is deemed to be the applicant.

Retention Status : The holder of a prospecting licence applied for and granted after 10 february 2006 may apply for approval of retention status for the prospecting licence. The minister may approve the application where there is an identified mineral resource within the prospecting licence, but it is impractical to mine the resource for prescribed reasons. Where retention status is granted, the minimum expenditure requirements are reduced in the year of grant and cease in future years. however, the minister has the right to impose a programme of works or require the holder to apply for a mining lease. The holder of a prospecting licence applied for or granted before 10 february 2006 can apply for a retention licence.

Conditions : prospecting licences are granted subject to various standard conditions including conditions relating to minimum expenditure, the payment of rent and observance of environmental protection and reporting requirements. These standard conditions are not detailed in the Tenement schedule. a failure to comply with these conditions may lead to forfeiture of the prospecting licence.

Priority to apply for a Mining Lease : The holder of a prospecting licence has priority to apply for a mining lease over any of the land subject to the prospecting licence. an application for a mining lease must be made prior to the expiry of the prospecting licence. The prospecting licence remains in force until the application for the mining lease is determined.

Transfer : There is no restriction on transfer or other dealing in a prospecting licence.

Reversion Application : The mining act allowed the holder of a prospecting licence who had applied for a mining lease before 10 february 2006 to lodge an application between 11 february 2006 and 10 february 2007 for an exploration licence or prospecting licence in lieu of the grant of the mining lease. The mining act provides that reversion applications are deemed to be transferred to a transferee of the underlying prospecting licence.

5.2 Exploration Licence

Application : a person may lodge an application for an exploration licence and the minister decides whether to grant the application. an application for an exploration licence (unless a reversion application) cannot be legally transferred and continues in the name of the applicant.

Rights : The holder of an exploration licence is entitled to enter the land and undertake operations for the purposes of exploration for minerals.

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Term : an exploration licence has a term of 5 years from the date of grant. The minister may extend the term where:

¬ the exploration licence was granted before 10 february 2006, by a further period or periods of 1 or 2 years; and
¬ the exploration licence was granted after 10 february 2006, by a further period of 5 years followed by a further period or periods of 2 years.

Where an exploration licence is transferred before a renewal application has been determined, the transferee is deemed to be the applicant.

Retention Status : The holder of an exploration licence granted after 10 february 2006 may apply for approval of retention status for the exploration licence. The minister may approve the application where there is an identified mineral resource within the exploration licence but it is impractical to mine the resource for prescribed reasons. Where retention status is granted, the minimum expenditure requirements are reduced in the year of grant and cease in future years. however, the minister has the right to impose a programme of works or require the holder to apply for a mining lease. The holder of an exploration licence applied for or granted before 10 february 2006, can apply for a retention licence.

Conditions : exploration licences are granted subject to various standard conditions, including conditions relating to minimum expenditure, the payment of prescribed rent and royalties and observance of environmental protection and reporting requirements. a failure to comply with these conditions may lead to forfeiture of the exploration licence.

Relinquishment : The holder of an exploration licence granted or applied for before 10 february 2006 must relinquish not less than half of the blocks comprising the licence at the end of the third year. a further relinquishment of not less than half of the remaining blocks is required at the end of the fourth year. The holder of an exploration licence applied for and granted after 10 february 2006 must relinquish not less than 40% of the blocks comprising the licence at the end of the fifth year.

Priority to apply for Mining Lease : The holder of an exploration licence has priority to apply for a mining lease over any of the land subject to the exploration licence. any application for a mining lease must be made prior to the expiry of the exploration licence. The exploration licence remains in force until the application for the mining lease is determined.

Transfer : no legal or equitable interest in an exploration licence can be transferred or otherwise dealt with during the first year of its term without the prior written consent of the minister. Thereafter, there is no restriction on transfer or other dealing.

Reversion Application : The mining act allowed the holder of an exploration licence who had applied for a mining lease before 10 february 2006 to lodge an application between 11 february 2006 and 10 february 2007 for an exploration licence or prospecting licence in lieu of the grant of the mining lease. The mining act provides that reversion applications are deemed to be transferred to a transferee of the underlying exploration licence.

6. ABORIGINAL HERITAGE

There may be areas or objects of aboriginal heritage located on the Tenements.

The company must ensure that it is in compliance with the commonwealth and the relevant state or Territory legislation relating to aboriginal heritage as set out below. To ensure that it does not contravene such legislation, the company would need to conduct heritage surveys to determine if any aboriginal areas or objects exist within the area of the Tenements. any interference with these sites must be in strict conformity with the provisions of the relevant legislation. it may also be necessary for the company to enter into separate arrangements with the traditional owners of the sites.

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Solicitor’s Report on Tenements (continued)

6.1 Commonwealth Legislation

The Aboriginal and Torres Strait Islander Heritage Protection Act 1984 (Cth) ( Commonwealth Heritage Act ) is aimed at the preservation and protection of any aboriginal areas and objects that may be located on the Tenements.

under the commonwealth heritage act, the minister for aboriginal affairs may make interim or permanent declarations of preservation in relation to significant aboriginal areas or objects, which have the potential to halt exploration activities. compensation is payable by the minister to a person who is, or is likely to be, affected by a permanent declaration of preservation.

it is an offence to contravene a declaration made under the heritage protection act.

6.2 Western Australian Legislation

Tenements are granted subject to a condition requiring observance of the Aboriginal Heritage Act 1972 (Wa) (Wa heritage act).

The Wa heritage act makes it an offence to alter or damage sacred ritual or ceremonial aboriginal sites and areas of significance to aboriginal persons.

The minister’s consent is required where any use of land is likely to result in the excavation, alteration or damage to an aboriginal site or any objects on or under that site.

aboriginal sites may be registered under the Wa heritage act. however, there is no requirement for a site to be registered and the Wa heritage act protects all registered and unregistered sites.

7. NATIVE TITLE

7.1 Introduction

This section of the report examines the effect of native title on the Tenements.

The existence of native title rights held by indigenous australians was first recognised in australia in 1992 by the high court in the case Mabo v. Queensland (no.2) (1992) 175 clr 1 ( Mabo no.2 ).

mabo no. 2 held that certain land tenure existing as at the date of that case, including mining tenements, where granted or renewed without due regard to native title rights, were invalid.

as a result of mabo no. 2, the Native Title Act 199 3 (cth) ( NTA ) was passed to:

(a) provide a process for indigenous people to lodge claims for native title rights over land, for those claims to be registered by the national native Title Tribunal ( NNTT ) and for the courts to assess native title claims and determine if native title rights exist. Where a court completes the assessment of a native title claim, it will issue a native title determination that specifies whether or not native title rights exist;
(b) provide (together with associated state legislation) that any land tenures granted or renewed before 1 January 1994 were valid despite mabo no. 2. This retrospective validation of land tenure was subsequently extended by the nTa to include freehold and certain leasehold (including pastoral leases) granted or renewed before 23 december 1996; and
(c) provide that an act that may affect native title rights (such as the grant or renewal of a mining tenement) carried out after 23 december 1996 (a Future Act ) must comply with certain requirements for the future act to be valid under the nTa. These requirements are called the Future Act Provisions .

The future act provisions are summarised in section 7.2 below, following which the report identifies:

(a) native title claims and determinations that are registered against the Tenements (see section 7.3);

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(b) Tenements which have been retrospectively validated under the nTa as being granted before 23 december 1996 (see section 7.4);
(c) Tenements which have been granted after 23 december 1996 and as such will need to have been granted following compliance with the future act provisions to be valid under the nTa. This report assumes that the future act provisions have been complied with in relation to these Tenements (see section 7.4); and
(d) Tenements which are yet to be granted and which may need to comply with the future act provisions in order to be valid under the nTa (see section 7.4).

note that the grant of a Tenement does not need to comply with the future act provisions if in fact native title has never existed over the land covered by the Tenement, or has been validly extinguished prior to the grant of the Tenement. We have not undertaken the extensive research needed to determine if in fact native title does not exist, or has been validly extinguished in relation to the Tenements.

unless it is clear that native title does not exist (e.g. in relation to freehold land), the usual practice of the state is to comply with the future act provisions when granting a Tenement. This ensures the grant will be valid in the event a court determines that native title rights do exist over the land subject to the Tenement and as such, the future act provisions apply.

Where a Tenement has been retrospectively validated or validly granted under the nTa, the rights under the Tenement prevail over any inconsistent native title rights.

7.2 Future Act Provisions

The future act provisions vary depending on the future act to be carried out. in the case of the grant of a mining tenement, typically there are three alternatives: the right to negotiate, an indigenous land use agreement (ilua) and the expedited procedure. These are summarised below.

Right to Negotiate

The right to negotiate involves a formal negotiation between the state, the applicant for the Tenement and any registered native title claimants and holders of native title rights. The aim is to agree the terms on which the Tenement can be granted. The applicant for the Tenement is usually liable for any compensation that the parties agree to pay to the registered native title claimants and holders of native title. The parties may also agree on conditions that will apply to activities carried out on the Tenement (e.g. in relation to heritage surveys).

if agreement is not reached to enable the Tenement to be granted, the matter may be referred to arbitration before the nnTT, which has 6 months to decide whether the Tenement can be granted and if so, on what conditions. The nnTT usually requires the parties to have had at least 6 months of negotiations before it will accept a referral for arbitration.

ILUA

an ilua is a contractual arrangement governed by the nTa. under the nTa, an ilua must be negotiated with all registered native title claimants for a relevant area. The state and the applicant for the Tenement are usually the other parties to the ilua.

an ilua must set out the terms on which a tenement can be granted. an ilua will also specify conditions on which activities may be carried out within the tenement. The applicant for a tenement is usually liable for any compensation that the parties agree to pay to the registered native title claimants and holders of native title in return for the grant of the Tenement being approved. These obligations pass to a transferee of the tenement.

once an ilua is agreed and registered, it binds the whole native title claimant group and all holders of native title in the area (including future claimants), even though they may not be parties to it.

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Expedited Procedure

The nTa establishes a simplified process for the carrying out of a future act that is unlikely to adversely affect native title rights ( Expedited Procedure ). The grant of a tenement can occur under the expedited procedure if:

(a) the grant will not interfere directly with the carrying on of the community or social activities of the persons who are the holders of native title in relation to the land;
(b) the grant is not likely to interfere with areas or sites of particular significance, in accordance with their traditions, to the persons who are holders of native title in relation to the land; and
(c) the grant is not likely to involve major disturbance to any land or waters concerned or create rights whose exercise is likely to involve major disturbance to any land.

if the state considers the above criteria are satisfied, it commences the expedited procedure by giving notice of the proposed grant of the Tenement in accordance with the nTa. persons have until three (3) months after the notification date to take steps to become a registered native title claimant or native title holder in relation to the land to be subject to the Tenement.

if there is no objection lodged by a registered native title claimant or a native title holder within four (4) months of the notification date, the state may grant the Tenement.

if one or more registered native title claimants or native title holders object within that four (4) month notice period, the nnTT must determine whether the grant is an act attracting the expedited procedure. if the nnTT determines that the expedited procedure applies, the state may grant the Tenement. otherwise, the future act provisions (e.g. right to negotiate or ilua) must be followed before the Tenement can be granted.

7.3 Registered Native Title Claims and Determinations

our searches indicate that the Tenements are subject to the following native title claims and determinations. as at the date of this report, e09/1899 has not been accepted for registration.

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NATIVE TITLE
TENEMENT NATIVE TITLE CLAIM
DETERMINATION
p63/1694 Wc99/2 nil
Wc96/64 nil
p63/1646
Wc99/2 nil
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The status of the native title claims is summarised in schedule 2.

The native title claimants and holders of native title under the determinations are entitled to certain rights under the future act provisions.

7.4 Validity of Tenements under the NTA

The sections below examine the validity of the Tenements under the nTa.

Tenements granted before 23 December 1996

our searches indicate that none of the Tenements were granted before 23 december 1996.

Tenements granted after 23 December 1996

our searches indicate that the following Tenements were granted after 23 december 1996.

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TENEMENT DATE OF GRANT
p63/1694 16 July 2009
p63/1646 9 June 2009
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We have assumed that these Tenements were granted in accordance with the future act provisions and, as such, are valid under the nTa.

Tenements renewed after 23 December 1996

renewals of mining tenements made after 23 december 1996 must comply with the future act provisions in order to be valid under the nTa.

our searches indicate that the following none of the Tenements have been renewed after 23 december 1996.

renewals of Tenements in the future will need to comply with the future act provisions in order to be valid under the nTa. The registered native title claimants and holders of native title identified in section 7.3 of this report will need to be involved as appropriate under the future act provisions.

Valid grant of Applications for Tenements

The future act provisions must be complied with when granting any of the Tenements that are currently applications. This will ensure that the newly granted Tenements are valid under the nTa be assured.

The following Tenement is currently an application and, as such, will need to satisfy the future act provisions.

APPLICANT	TENEMENT
Terranova minerals limited	e09/1899

The registered native title claimants and holders of native title identified in section 7.3 of this report will need to be involved as appropriate under the future act provisions.

note that the grant of any tenements in the future in relation to the Tenements (e.g. the grant of a mining lease from an exploration licence) will also need to comply with the future act provisions.

8. MATERIAL CONTRACTS

There are no agreements registered as dealings against the Tenements as at the date of our dmp searches.

We have been provided with one material agreement that applies to the red field Tenements, namely, the sale of mining tenement agreement with red field resources pty ltd under which red field agreed to sell all of red field’s rights in prospecting licences p 63/1646 and p 63/1694 to the company. We have summarised the material terms of this agreement in section 10.1 of the prospectus.

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Solicitor’s Report on Tenements (continued)

9. qUALIFICATIONS

While the status of the Tenements is dealt with in the Tenement schedule, we point out, by way of summary, that:

(a) we have assumed the accuracy and completeness of all tenement searches and other information or responses which were obtained from the relevant department or authority. We cannot comment on any obligations of the company that may arise from agreements that are not registered as a dealing, encumbrance or otherwise noted on the searches of the Tenement;
(b) with respect to the Tenement, we have assumed the accuracy and completeness of the information which we have received from the various departments;
(c) the holding of the Tenements is subject to compliance with the terms and conditions and the provisions of the applicable state mining legislation;
(d) we have assumed the accuracy and completeness of any instructions or information which we have received from the company or any of its officers, agents and representatives;
(e) where compliance with the requirements necessary to maintain a Tenement in good standing is not disclosed on the face of the searches referred to in this report, we express no opinion on such compliance;
(f) references in the Tenement schedule to any area of land are taken from details shown on searches obtained from the relevant department. it is not possible to verify the accuracy of those areas without conducting a survey;
(g) where ministerial consent to any agreement or dealing referred to in the agreements is being or will be sought, we express no opinion as to whether such consent will be granted, or the consequences of consent being refused, although we have no reason to believe that any application for consent will be refused; and
(h) the information in the schedules is accurate as at the date the relevant searches were obtained. We cannot comment on whether any changes have occurred in respect of the Tenement between the date of the searches and the date of the prospectus.

yours faithfully

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STEINEPREIS PAGANIN

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Solicitor’s Report on Tenements (continued)

condiTions / noTes	e09/1899 Terranova minerals limited 100 n/a n/a 7 Blocks n/a n/a n/a n/a n/a none n/a nil	p63/1694 red field pty ltd 100 16 July 2009 15 July 2013 8.1 ha rent for year end 15/07/2011: paid in full rent for year end 15/07/2012: $22.00 $2,000 expenditure for year end 15/07/2010: expended in full expenditure for year end 15/07/2011: expended in full n/a n/a Wc99/2 n/a 1 – 4	p63/1646 red field pty ltd 100 09 July 2009 8 July 2013 16.65 ha rent for year end 8/07/2012: paid in full rent for year end 8/07/2013: $37.40 $2,000 expenditure for year end 08/07/2011: expended in full expenditure for year end 08/07/2012: $2,000 commitment n/a n/a Wc96/64 Wc99/2 n/a 1 - 4	Key to Tenement Schedule p - prospecting licence e - exploration licence unless otherwise indicated, capitalised terms have the same meaning given to them in the relevant mining act. Notes 1. all surface holes drilled for the purpose of exploration to be capped, flled or otherwise made safe immediately after completion. 2. all costeans and other disturbances to the surface of the land made as a result of exploration, unclading drill pads, grid lines and access tracks, being backflled and rehabilitated to the satisfaction of the environmental ofcer, department of mines and petroleum (dmp). Backflling and rehabilitation being required no later than 6 months after excavation unless otherwise approved in writing by the environmental ofcer. 3. all waste materials, rubbish, plastic sample bags, abandoned equipment and temporary buildings being removed from the mining tenement prior to or at the termination of exploration program. unless the written approval of the environmental ofcer, dmp is frst obtained, the use of drilling rigs, scrapers, graders, bulldozers, backhoes or other mechanised equipment for surface disturbance or the excavation of costeans is prohibited. following approval, all topsoil being removed ahead of mining operations and separately stockpiled for replacement after backflling and/or completion of operations.
aBoriginal heriTage siTes
naTiVe TiTle claims / deTerminaTions / iluas
Bonds
regisTered encumBrances / dealings and maTerial agreemenTs
saTisfacTion of eXpendiTure condiTions To daTe
minimum annual eXpendiTure
annual renT (neXT renTal year)
area siZe
eXpiry
granT
shares held
regisTered holder / applicanT
TenemenT

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Solicitor’s Report on Tenements (continued)

SCHEDULE 2 – STATUS OF NATIVE TITLE CLAIMS

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TriBunal federal courT applicaTion name regisTered in mediaTion sTaTus
numBer numBer
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Wc96/64	Wad6097/98	elaine Bullen &	yes	yes	active
		others on behalf of
		the esperance
		nyungars
Wc99/2	Wad6020/98	arthur dimer, ollan	yes	yes	active
		dimer & others

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T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Risk Factors

9.1 GENERAL

The shares offered under this prospectus should be considered speculative because of the nature of the company’s business.

There are numerous risk factors involved with the company’s business. some of these risks can be mitigated by the use of safeguards and appropriate systems and controls, but some are outside the control of the company and cannot be mitigated. accordingly, an investment in the company carries no guarantee with respect to the payment of dividends, return of capital or price at which securities will trade.

9.2 RISKS SPECIFIC TO THE COMPANY

The risk factors which are specific to the company are detailed in the investment overview section on page 8 of this prospectus. please refer to that section for more information.

9.3 TITLE RISK

The Tenements are governed by legislation relating to grant, renewal and forfeiture. There is no guarantee that current or future applications, conversions or renewals of tenure will be approved.

The Tenements will be subject to a number of specific legislative conditions including payment of rent and meeting minimum annual expenditure commitments. The inability to meet these conditions in relation to the Tenements could affect the standing of Tenements or restrict its ability to be renewed, adversely affecting the operations, financial position and performance of the company.

9.4 CHANGES IN GOVERNMENT POLICY

adverse changes in federal or Western australian government policies or legislation may affect ownership of mineral interests, taxation, royalties, land access, labour relations, and mining and exploration activities of the company. it is possible that the current system of exploration and mine permitting in Western australia may change, resulting in impairment of rights and possibly expropriation of the company’s properties without adequate compensation. in addition, there is a possibility that the company’s agreements with governments or joint venture partners may be unenforceable against such parties.

9.5 REGULATORY APPROVALS

regulatory approvals are required prior to any work being undertaken on the ground. The granting of such approvals may take time to achieve and no guarantees can be given that the approvals will be granted in the required timeframe or at all.

9.6 OPERATING RISKS

The operations of the company in relation to any Tenements may be affected by various factors, including failure to locate or identify mineral deposits, failure to achieve predicted grades in exploration and mining, operational and technical difficulties encountered in mining, difficulties in commissioning and operating plant and equipment, mechanical failure or plant breakdown, adverse weather conditions, industrial and environmental accidents, industrial disputes and unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment.

no assurances can be given that the company will achieve commercial viability through the successful exploration and/or mining of any Tenements.

9.7 RESOURCE ESTIMATES

The company does not currently have any Jorc compliant resources. should a Jorc compliant resource be delineated in the future, any resource estimate will be an expression of judgement based on knowledge, experience and industry practice. estimates which were valid when originally calculated may alter significantly when new information or techniques become available. in addition, by their very nature, resource estimates are imprecise and depend to some extent on interpretations, which may prove to be inaccurate. as further information becomes available through additional fieldwork and analysis, the estimates are likely to change. This may result in alterations to development and mining plans which may, in turn, adversely affect the company’s operations.

9.8 COMMODITY AND CURRENCY VOLATILITY

if the company achieves success leading to mineral production, the revenue it will derive through the sale of commodities exposes the potential income of the company to commodity price and currency exchange rate risks.

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Risk Factors (continued)

commodity prices inherently fluctuate and are affected by numerous factors beyond the control of the company, including world demand for particular commodities, forward selling by producers and the level of production costs in major commodity producing regions. moreover, commodity prices are also affected by macroeconomic factors such as expectations regarding inflation, interest rates and global and regional demand for, and supply of, a commodity.

commodities are principally sold throughout the world in us dollars. as a result, any significant and/ or sustained fluctuations in the exchange rate between the australian dollar and the us dollar and/ or adverse movements in commodity prices, could have a materially adverse effect on the company’s operations, financial position (including revenue and profitability) and performance. The company may undertake measures where deemed necessary by the board of directors to mitigate such risks.

9.9 ENVIRONMENTAL RISKS

The operations and proposed activities of the company are subject to laws and regulation concerning the environment. as with most exploration Tenements and mining operations, the company’s activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. it is the company’s intention to conduct its activities to the highest standard of environmental obligation, including compliance with all environmental laws.

9.11 COMPETITION RISK

The industry in which the company will be involved is subject to domestic and global competition. although the company will undertake all reasonable due diligence in its business decisions and operations, the company will have no influence or control over the activities or actions of its competitors, which activities or actions may, positively or negatively, affect the operating and financial performance of the company’s projects and business.

9.12 ADDITIONAL REqUIREMENTS FOR CAPITAL

The company’s capital requirements depend on numerous factors. depending on the company’s ability to generate income from its operations, the company may require further financing in addition to amounts raised under the capital raising. any additional equity financing will dilute shareholdings, and debt financing, if available, may involve restrictions on financing and operating activities. if the company is unable to obtain additional financing as needed, they may be required to reduce the scope of their operations, including the company scaling back its exploration programmes.

9.13 ECONOMIC RISKS

general economic conditions, movements in interest and inflation rates and currency exchange rates may have an adverse effect on the company’s exploration, development and production activities, as well as on the company’s ability to fund those activities.

9.10 INSURANCE RISKS

The company intends to insure its operations in accordance with industry practice. however, in certain circumstances, the company’s insurance may not be of a nature or level to provide adequate insurance cover. The occurrence of an event that is not covered or fully covered by insurance could have a material adverse effect on the business, financial condition and results of the company.

9.14 MARKET CONDITIONS

share market conditions may affect the value of the company’s quoted securities regardless of the company’s operating performance. share market conditions are affected by many factors such as:

(a) general economic outlook;
(b) interest rates and inflation rates;

insurance against all risks associated with mining exploration and production is not always available and where available the costs can be prohibitive.

(c) currency fluctuations;
(d) changes in investor sentiment toward particular market sectors;
(e) the demand for, and supply of, capital; and
(f) terrorism or other hostilities.

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

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Risk Factors (continued)

The market price of securities can fall as well as rise and may be subject to varied and unpredictable influences on the market for equities in general and resource exploration stocks in particular. neither the company nor the directors warrant the future performance of the company or any return on an investment in the company.

9.15 RELIANCE ON KEY PERSONNEL

The responsibility of overseeing the day-to-day operations and the strategic management of the company depends substantially on its senior management and its key personnel. There can be no assurance given that there will be no detrimental impact on the company if one or more of these employees cease their employment.

9.16 INVESTMENT SPECULATIVE

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the company or by investors in the company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the company and the value of the securities offered under this prospectus. Therefore, the securities to be issued pursuant to this prospectus carry no guarantee with respect to the payment of dividends, returns of capital or the market value of those securities.

potential investors should consider that the investment in the company is speculative and should consult their professional advisers before deciding whether to apply for securities pursuant to this prospectus.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

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MATERIAL CONTRACTS 10

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Material Contracts

10.1 TENEMENT SALE AGREEMENT WITH RED FIELD PTY LTD

on or about 9 may 2011, red field entered into a Tenement sale agreement with the company pursuant to which red field agreed to sell to the company the Tenements p63/1694 and p63/1646, located in Western australia ( Red Field Tenements ) ( Red Field Agreement ).

as consideration for the acquisition of the red field Tenements, the company will issue and pay to red field:

(a) within 5 business days from the execution of the red field agreement, the company will pay an amount of $25,000 payable in cash for the reimbursement of previous exploration expenses in relation to the red field Tenements;
(b) at settlement, the company will pay an amount of $40,000 payable in cash for the reimbursement of previous exploration expenses in relation to the red field Tenements; and
(c) at settlement, the company will issue 300,000 shares in Terranova minerals to red field.

The red field agreement and the obligation of the parties to complete the sale and purchase of the assets are subject to and conditional upon:

(a) the purchaser successfully completing the capital raising and obtaining conditional approval to list on asX;
(b) as at completion, the Tenements being in good standing, full force and effect and free of encumbrances;
(c) compliance by the parties in all respects with the corporations act and the asX listing rules; and
(d) the consent, if required, of the minister for industry and resources being obtained to all dealings evidenced by this agreement in so far as those dealings require consent to be given under the mining act.

The red field agreement otherwise contains terms that are standard for an agreement of this nature, including (but not limited to) in relation to the termination events, access rights prior to completion, standard warranties and confidentiality.

10.2 CORPORATE ADVISORY MANDATE

on or about 1 april 2011, the company entered into a corporate mandate with hemisphere corporate to act as corporate advisor to the company with respect to the offer.

The company has agreed, subject to shareholder approval, to pay hemisphere corporate the following:

(a) from 1 april 2011, a monthly corporate advisory fee of $10,000 payable in arrears on the last day of each month. This fee is to be capped at $60,000 (subject to any unforeseen events occurring) ( Corporate Advisory Fee );
(b) subject to the company being admitted to the asX and obtaining all shareholder and regulatory approvals, a success fee of $150,000 to be paid within seven (7) days of the company’s admission ( Corporate Advisory Success Fee ); and
(c) all reasonable out of-pocket-expenses, including travel and accommodation, with such costs to be approved by the company in advance.

10.3 EMPLOYEE SHARE PLAN

The company has adopted an employee share plan (employee share plan) in order to provide an incentive for eligible participants to participate in the future growth of the company (eligible employees). it is intended that the employee share plan will be administered in accordance with the employee share plan rules, which are summarised below.

(a) Grant of Shares

The directors, at their discretion, may issue shares (plan shares) to participants (or to a nominee as the participant directs) at any time, having regard to relevant considerations such as the participant’s past and potential contribution to the company, and their period of employment with the company.

(b) Participants

full-time employees, part-time employees and directors of the company, or of a related body corporate, who hold a salaried employment or office in the company or in a related body corporate, are eligible to participate in the employee share plan (participants). however, in the event that directors of the company are invited to participate in the plan,

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Material Contracts (continued)

the company will seek shareholder approval for that participation in accordance with listing rule 10.14.

(c) Issue Price of Plan Shares

plan shares may be issued at an price to be determined by the Board, which may be a nominal or nil amount if so determined by the Board (issue price).

(d) Maximum Number of Plan Shares

The company must take reasonable steps to ensure that the number of plan shares offered by the company under the employee share plan when aggregated with:

(i) the number of plan shares issued during the previous 5 years under the employee share plan (or any other employee share plan extended only to eligible employees); and
(ii) the number of shares that would be issued if each outstanding offer for shares (including options to acquire unissued shares) under any employee incentive plan of the company were to be exercised or accepted, does not exceed 5% of the total number of issued shares at the time of an offer of plan shares (but disregarding any offer of shares or option to acquire shares that can be disregarded in accordance with the asic class order 03/184.

(e) Term of Plan Shares

The plan shares will be issued on the same terms as the fully paid, ordinary shares of the company and will rank equally with all of the company’s then existing shares.

(f) Restrictions on transfer of Plan Shares

The Board may impose conditions in an offer of plan shares that must be satisfied (unless waived by the Board in its absolute discretion) before the plan shares to which the condition applies can be sold, transferred, assigned, charged or otherwise encumbered (restriction conditions).

Where any applicable restriction conditions in relation to plan shares have not been satisfied and:

(i) the participant dies;
(ii) the eligible employee to whom the offer was originally made ceases to be employed as a result of:
(a) bona fide retirement from the workforce (unless the retirement happens within six (6) months of the date of the issue of the plan shares);
(B) bona fide redundancy; or
(c) total and permanent disability,

the Board may elect to:

(iii) allow the participant to retain the plan shares;
(iv) waive any of the restriction conditions; and/or
(v) permit the participant (or their personal legal representative) to sell, transfer, assign, mortgage, charge or otherwise encumber the participant’s plan shares.

(g) Buy back of Plan Shares

subject to the exemptions identified in sub-clause 10.3(f) above, where a restriction condition in relation to plan shares is not satisfied by the due date, or becomes incapable of satisfaction in the opinion of the Board, the company must, unless the restriction condition is waived by the Board:

(i) where the plan shares were issued for no cash consideration, subject to the corporations act and the asX listing rules, buy back the relevant plan shares within 12 months of the date the restriction condition was not satisfied (or became incapable of satisfaction) under part 2J.1 of the corporations act at a price equal to $0.0001 per share; or

subject to the exceptions identified below, a participant may not sell, transfer, assign, mortgage, charge or otherwise encumber a plan share until any applicable restriction conditions are satisfied or waived by the Board in its absolute discretion.

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Material Contracts (continued)

(ii) where the shares were issued for cash consideration, subject to the corporations act and the asX listing rules, use its best endeavours to buy back the relevant plan shares within 12 months of the date the restriction condition was not satisfied (or became incapable of satisfaction) under part 2J.1 of the corporations act at a price equal to the cash consideration paid by the participant for the plan shares.

services. additional administration services required by the company will be charged on a day rate of $300 per day (excluding gsT).

10.5 LEAD MANAGER AGREEMENT

on 22 march 2011, the company entered into a lead manager agreement with patersons securities. pursuant to the agreement, patersons securities will act as lead manager to the offer and provide the company with assistance in undertaking the offer.

(h) quotation of Plan Shares

The company will make application for official quotation of all plan shares as soon as practicable after their issue date.

a selling fee is payable to patersons securities by the company, being 4% of the funds raised. an issue management fee is also payable to patersons securities by the company, being 1% of the funds raised.

(i) Powers of the Board of Directors

The employee share plan is administered by the directors of the company, who have the power to:

(i) determine appropriate procedures for administration of the employee share plan consistent with its terms;
(ii) resolve conclusively all questions of fact or interpretation in connection with the employee share plan;

This lead manager agreement otherwise contains terms and conditions which are considered standard in an agreement of this type.

10.6 OTHER AGREEMENTS

other material agreements with directors (or director related entities) are summarised at the beginning of this prospectus.

(iii) delegate the exercise of any of its powers or discretions arising under the employee share plan to any one or more persons for such period and on such conditions as the Board may determine; and
(iv) suspend or terminate the employee share plan by giving written advice to eligible employees.

10.4 SHARED OFFICE AND ADMINISTRATION SERVICES WITH HEMISPHERE CORPORATE

on 1 april 2011, the company entered into an agreement with hemisphere corporate for the provision of shared office and administration services. The initial term of the agreement is 12 months and will continue on a month by month basis until terminated by either party giving at least 90 days written notice to the other party.

The company has agreed to pay hemisphere corporate a monthly fee of $15,000 plus gsT for rent and variable outgoings and not less than $2,500 (excluding gsT) per month for the provision of company secretary and general administration

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ADDITIONAL INFORMATION 11

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

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Additional Information

11.1 RIGHTS ATTACHING TO SHARES

full details of the rights attaching to shares are set out in the company’s constitution a copy of which can be inspected, free of charge, at the company’s registered office during normal business hours.

The following is a broad summary of the rights, privileges and restrictions attaching to all shares. This summary is not exhaustive and does not constitute a definitive statement of the rights and liabilities of shareholders.

The summary is prepared on the basis that the change of the status of the company from a public limited company to a no-liability company, as approved by shareholders on 1 march 2011, proceeds. The change is expected to occur prior to the date that the company lists on asX.

Broadly, a limited liability company is one in which the liability of its members is limited to the respective amounts that the members undertake to contribute to the property of the company if it is wound up, that is the unpaid proportion of the issue price of their shares. a no-liability company is one in which its members are not bound to pay calls made by the company on their shares. should the shareholder chose not to pay when there is a call, the shareholder forfeits both the unpaid and paid shares. no-liability companies may only be used where the company has stated in its constitution that its objectives are only mining activities.

(a) General Meetings

shareholders are entitled to be present in person, or by proxy, attorney or representative to attend and vote at general meetings of the company.

shareholders may requisition meetings in accordance with section 249d of the corporations act and the constitution of the company.

(b) Voting Rights

subject to any rights or restrictions for the time being attached to any class or classes of shares, at general meetings of shareholders or classes of shareholders:

(i) each shareholder entitled to vote may vote in person or by proxy, attorney or representative;
(ii) on a show of hands, every person present who is a shareholder or a proxy, attorney or

representative of a shareholder has one vote; and

(iii) on a poll, every person present who is a shareholder or a proxy, attorney or representative of a shareholder shall, in respect of each fully paid share held by him, or in respect of which he is appointed a proxy, attorney or representative, have one vote for the share, but in respect of partly paid shares shall have such number of votes as bears the same proportion to the total of such shares registered in the shareholder’s name as the amount paid (not credited) bears to the total amounts paid and payable (excluding amounts credited).

(c) Dividend Rights

subject to the rights of persons (if any) entitled to shares with special rights to dividends, the directors may declare a dividend in accordance with the corporations act and may authorise the payment or crediting by the company to the shareholders of such a dividend. The directors may from time to time pay to shareholders any interim dividend that they may determine. subject to the rights of any preference shareholders and to the rights of the holders of any shares credited or raised under any special arrangement as to the dividend,, the dividend as declared shall be payable on all shares irrespective of the amount paid up, or credited as paid up, on the shares, and otherwise in accordance with part 2h.5 of the corporations act. interest may not be paid by the company in respect of any dividend, whether final or interim.

(d) Winding-Up

if the company is wound up, the liquidator may, with the authority of a special resolution of the company, divide among the shareholders in kind the whole or any part of the property of the company, and may for that purpose set such value as he considers fair upon any property to be so divided, and may determine how the division is to be carried out as between the shareholders or different classes of shareholders. The liquidator may, with the authority of a special resolution of the company, vest the whole or any part of any such property in trustees upon such trusts for the benefit of the contributories as the liquidator thinks fit, but so that no shareholder is compelled to accept any shares or other securities in respect of which there is any liability.

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Additional Information (continued)

(e) Transfer of Shares

generally, shares in the company are freely transferable, subject to formal requirements, the registration of the transfer not resulting in a contravention of or failure to observe the provisions of a law of australia and the transfer not being in breach of the corporations act or the listing rules.

(f) Variation of Rights

pursuant to section 246B of the corporations act, the company may, with the sanction of a special resolution passed at a meeting of shareholders vary or abrogate the rights attaching to shares.

if at any time the share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class), whether or not the company is being wound up may be varied or abrogated with the consent in writing of the holders of three-quarters of the issued shares of that class, or if authorised by a special resolution passed at a separate meeting of the holders of the shares of that class.

11.2 RIGHTS ATTACHING TO PARTLY PAID SHARES

Partly Paid Shares

The directors may, subject to compliance with the company’s constitution, the corporations act and the listing rules, issue partly paid shares upon which amounts are or may become payable at a future time(s) in satisfaction of all or part of the unpaid issue price.

The following contains the full terms of the rights of the holders of partly paid shares. This is not exhaustive nor does it constitute a definitive statement of the rights and liabilities attaching to partly paid shares:

(a) each partly paid share is issued at a price of 20 cents of which 1 cent is paid on issue with the balance of the issue price payable at the election of the holder at any time, and subject to points (b) and (c) below.
(b) The holder shall have the right to pay calls in advance on the partly paid shares issued. any notice of payment of calls in advance by the holder ( Payment Notice ) shall be in writing and delivered to the registered office of the

company. The payment notice shall specify the number of partly paid shares in respect of which such payment is being made, the amount per share which is being paid up, and shall be accompanied by the appropriate payment for the number of partly paid shares specified in the payment notice. The directors of the company must, within 3 days after receipt of the payment notice, accept payment, credit the amount paid up and issue the appropriate holding statement for fully paid shares in respect of any shares which have been fully paid up.

(c) subject to the corporations act and the company’s constitution, the company shall only be entitled to make a call on the partly paid shares on that date which is one (1) day before the five (5) years from the date of issue of the partly paid shares. if a call is not paid when made, the partly paid shares shall be subject to forfeiture in accordance with the procedure set out in section 254Q of the corporations act.
(d) a statement of holding will be issued for the partly paid shares and will be forwarded to the holder together with the terms and conditions of the partly paid shares.
(e) dividends may be declared in respect of any of the partly paid shares notwithstanding that the issue price of such partly paid shares has not been paid in full. The partly paid shares will participate in any dividends on the same basis as if the partly paid shares were fully paid.
(f) The holder will be entitled to exercise any vote attaching to a partly paid share at general meetings of members in accordance with the constitution of the company. under the constitution, on a poll, partly paid shares have a vote prorate to the proportion of the total issue price paid up. amounts paid in advance of a call will be ignored when calculating the proportion.
(g) partly paid shares allotted to the holder will participate in all issues of securities (including issues of shares, options and convertible notes) made to shareholders of the company pro-rata to the proportion of the total issue price paid up. in respect of an issue of bonus securities, amounts paid in advance of a call will be ignored when calculating the proportion.

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Additional Information (continued)

(h) The company will ensure that, at least 6 business days before the record date to determine entitlement to any such new entitlements issue, the company will announce to asX details of the proposed new entitlements issue. This will afford the holder an opportunity to pay up all or some of the partly paid shares prior to the record date of any such new entitlements issue.
(i) in the event of a reconstruction (including consolidation, sub division, reduction or return) of the issued capital of the company, the number of partly paid shares shall be reconstructed in accordance with the listing rules.
(j) subject to the partly paid shares becoming fully paid, the company will apply for listing of the fully paid shares on the asX.
(k) ln the event of death of the holder, the right of the holder to pay up the partly paid shares which are not at the time of the death of the holder fully paid up, will vest in the holder’s executor and/or administrator as the case may be and such executor and/or administrator shall have the same rights to pay up the partly paid shares as such deceased holder would have had but for the holder’s death.
(l) upon becoming fully paid, each partly paid share will rank equally in all respects with the other issued fully paid ordinary shares in the company.
(m) subject to the asX listing rules, the partly paid shares, whilst partly paid, shall not be capable of transfer or assignment either in whole or in part without the approval of the directors.

11.3 FEES AND BENEFITS

other than as set out below or elsewhere in this prospectus, no:

(a) director of the company;
(b) person named in this prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this prospectus; or
(c) promoter of the company,

has, or had within two years before lodgement of this prospectus with the asic, any interest in:

(d) the formation or promotion of the company;
(e) any property acquired or proposed to be acquired by the company in connection with its formation or promotion or in connection with the offer of shares under this prospectus; or
(f) the offer of shares under this prospectus,

and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to any of those persons as an inducement to become, or to qualify as, a director of the company or for services rendered in connection with the formation or promotion of the company or the offer of shares under this prospectus.

Bmgs perth pty ltd has acted as the independent geologist and has prepared an independent geologist’s report which has been included in section 6 of this prospectus. The company estimates that it will pay Bmgs perth pty ltd a total of $12,000 for these services. during the 24 months preceding lodgement of this prospectus with the asic, Bmgs perth pty ltd has not received any other fees from the company.

hemisphere corporate has acted as corporate adviser to the company. in respect of this work, hemisphere corporate will be paid such amounts as detailed in section 10.2. The company has also agreed to pay hemisphere corporate such amounts as detailed in section 10.4 for shares office and administration services with hemisphere corporate. during the 24 months preceding lodgement of this prospectus at the asic, hemisphere corporate has not received any fees from the company. mr matthew foy and mr Benjamin Bussell are current employees of hemisphere corporate, however, will not receive any additional fees or benefits in connection with the services provided by hemisphere corporate.

patersons securities has acted as lead manager of the offer. in respect of this work, patersons securities will be paid such amounts as detailed in section 10.5. during the 24 months preceding lodgement of this prospectus at the asic, patersons securities has not received any fees from the company.

steinepreis paganin has acted as the solicitors to the company in relation to the offer, has been involved in due diligence enquiries on legal matters and has prepared a solicitor’s report on Tenements which has been included in section 8 of this

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Additional Information (continued)

prospectus. The company estimates it will pay steinepreis paganin approximately $30,000 for these services. subsequently, fees will be charged in accordance with normal charge out rates. during the 24 months preceding lodgement of this prospectus with the asic, steinepreis paganin has not received any other fees for legal services.

Bdo corporate finance (Wa) pty ltd has acted as investigating accountant and has prepared an investigating accountant’s report which has been included in section 7 of this prospectus. The company estimates it will pay Bdo corporate finance (Wa) pty ltd a total of $15,000 for these services. subsequently, fees will be charged in accordance with normal charge out rates. during the 24 months preceding lodgement of this prospectus with the asic, Bdo corporate finance (Wa) pty ltd has not received any fees from the company.

11.4 CONSENTS

each of the parties referred to in this section:

(a) does not make, or purport to make, any statement in this prospectus other than those referred to in this section; and
(b) to the maximum extent permitted by law, expressly disclaim and take no responsibility for any part of this prospectus other than a reference to its name and a statement included in this prospectus with the consent of that party as specified in this section.

Bmgs perth pty ltd has given his written consent to being named as the independent geologist to the company in this prospectus and to the inclusion of the independent geologist’s report in section 6 in the form and context in which the report is included. Bmgs perth pty ltd has not withdrawn his consent prior to the lodgement of this prospectus with the asic.

hemisphere corporate has given its written consent to being named as the company’s corporate advisor in this prospectus. hemisphere corporate has not withdrawn its consent prior to the lodgement of this prospectus with the asic.

patersons securities has given its written consent to being named as the lead manager to the offer in this prospectus. patersons securities has not withdrawn its consent prior to the lodgement of this prospectus with the asic. patersons securities has

not authorised or caused the issue of the prospectus or the making of the offer.

Bdo corporate finance (Wa) pty ltd has given its written consent to being named as investigating accountant in this prospectus and to the inclusion of the investigating accountant’s report in section 7 in the form and context in which the report is included. Bdo corporate finance (Wa) pty ltd has not withdrawn its consent prior to lodgement of this prospectus with the asic.

steinepreis paganin has given its written consent to being named as the solicitor to the company in this prospectus and to the inclusion of the solicitor’s report on Tenements in section 8 in the form and context in which the report is included. steinepreis paganin has not withdrawn its consent prior to the lodgement of this prospectus with the asic.

security Transfer registrars pty ltd has given its written consent to being named the company’s share registry in this prospectus and has not withdrawn its consent prior to lodgement of this prospectus with the asic.

11.5 LITIGATION

as at the date of this prospectus, the company is not involved in any legal proceedings and the directors are not aware of any legal proceedings pending or threatened against the company.

11.6 ELECTRONIC PROSPECTUS

pursuant to class order 00/044, the asic has exempted compliance with certain provisions of the corporations act to allow distribution of an electronic prospectus and electronic application form on the basis of a paper prospectus lodged with the asic, and the publication of notices referring to an electronic prospectus or electronic application form, subject to compliance with certain conditions.

if you have received this prospectus as an electronic prospectus, please ensure that you have received the entire prospectus accompanied by the relevant application forms. if you have not, please obtain a copy of the prospectus from the company’s website at www.terranovaminerals.com.au.

The company reserves the right not to accept an application form from a person if it has reason to believe that when that person was given access to

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Additional Information (continued)

the electronic application form, it was not provided together with the electronic prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered.

11.7 TAXATION

The acquisition and disposal of shares in the company will have tax consequences, which will differ depending on the individual financial affairs of each investor. all potential investors in the company are urged to obtain independent financial advice about the consequences of acquiring shares from a taxation viewpoint and generally.

To the maximum extent permitted by law, the company, its officers and each of their respective advisors accept no liability and responsibility with respect to the taxation consequences of subscribing for shares under this prospectus as a consequence of shares subscribed for under this prospectus.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Directors’ Authorisation

This prospectus is issued by the company and its issue has been authorised by a resolution of the directors.

in accordance with section 720 of the corporations act, each director has consented to the lodgement of this prospectus with the asic.

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Matthew Foy director

for and on behalf of TerranoVa minerals limited

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

T e r r a n o V a m i n e r a l s l i m i T e d p r o s p e c T u s

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

Glossary

Where the following terms are used in this prospectus they have the following meanings:

A$ or $ means an australian dollar.

Applicant means a person who submits an application form.

Application Form means the application form accompanying this prospectus relating to the offer.

ASiC means australian securities & investments commission.

ASX means asX limited (aBn 98 008 624 691) or the australian securities exchange (as the context requires).

Beete Gold Project means the project described as such in the independent geologist’s report.

Board means the board of directors as constituted from time to time.

Business Day means a week day when trading banks are ordinarily open for business in perth, Western australia.

Closing Date means the closing date of the offer as set out in the indicative timetable in the investment overview.

independent Geologist’s Report means the independent geologist’s report included in section 6 of this prospectus.

investment overview means the section of this prospectus so titled commencing on page 3.

Listing Rules means the official listing rules of asX.

offer means the offer of shares pursuant to this prospectus as outlined in the investment overview and section 3.1.

official List means the official list of asX.

Official Quotation means official quotation by asX in accordance with the listing rules.

Option means an option to subscribe for a share.

Partly Paid Share means a partly paid ordinary share in the capital of the company.

Patersons Securities means patersons securities limited (acn 008 896 311).

Peninsula Gold Project means the project described as such in the independent geologist’s report.

Prospectus means this replacement prospectus.

Company means Terranova minerals limited (acn 148 966 545).

Selling Fee means the fees payable to patersons securities referred to in section 10.5 of this prospectus.

Constitution means the constitution of the company.

Issue Management Fee is also payable to Patersons

Corporations Act means the corporations act 2001 (cth).

Corporate Advisory Fee means the fee payable to hemisphere corporate referred to in section 10.2 of this prospectus.

Corporate Advisory Success Fee means the fee payable to hemisphere corporate referred to in section 10.2 of this prospectus.

Crawford Project means the project described as such in the independent geologist’s report.

Directors means the directors of the company at the date of this prospectus.

Exposure Period means the period of 7 days after the date of lodgement of this prospectus, which period may be extended by the asic by not more than 7 days pursuant to section 727(3) of the corporations act.

Hemisphere Corporate means hemisphere corporate services pty ltd (acn acn 139 826 690).

Securities means the fees payable to patersons securities referred to in section 10.5 of this prospectus.

Red Field means red field pty ltd (acn 009 260 682).

Share means a fully paid ordinary share in the capital of the company.

Share Registry means security Transfer registrars pty ltd (acn 008 894 488).

Shareholder means a holder of shares.

Solicitor’s Report on Tenements means the “solicitor’s report on Tenements” included in section 8 of this prospectus.

Tenements means the tenements in which the company has or will have an interest as outlined in the solicitor’s report on Tenements.

WST means Western standard Time, perth, Western australia.

T e r r a n o Va m i n e r a l s l i m i T e d p r o s p e c T u s

APPLICATION FORM

This documenT is imporTanT. if you are in douBT as To hoW To deal WiTh iT, please conTacT your sTocK BroKer or licensed professional adVisor.

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SHARE REGiStRY:
BRoKER StAMP
security Transfer registrars pty ltd
All Correspondence to:
Po BoX 535, APPLECRoSS WA 6953 TERRANOVA MINERALS LIMITED
770 canning highway, applecross Wa 6153 acn: 148 966 545
T: +61 8 9315 2333 f: +61 8 9315 2233
e: [email protected]
W: www.securitytransfer.com.au Broker code
PLEASE READ CAREFuLLY ALL inStRuCtionS on tHE REVERSE oF tHiS FoRM advisor code
no shares will be issued pursuant to the prospectus later than 13 months after the date of the prospectus.
Before completing this application form you should read the accompanying prospectus and the instructions overleaf. please print using BlocK leTTers.
i/We apply for: i/We lodge full application of monies of:
, , shares at aud $0.20 per share a$ , , .
or such lesser number of shares which may be allocated to me/us by their directors.
Full name of Applicant / Company
Title (e.g.: dr, mrs) given name(s) or company name
Joint Applicant #2
Title (e.g.: dr, mrs) given name(s) or company name
Joint Applicant #3
Title (e.g.: dr, mrs) given name(s) or company name
Account Designation (e.g.: The smiTh super fund a/c)
< >
Postal Address
unit street number street name or po BoX
/
suburb/Town/city state postcode
country name (if not australia)
CHESS Hin (where applicable)
if an incorrect chess hin has been provided (e.g.: incorrect number, registration details do not
X
match those registered) any securities issued will be held on the issuer sponsored subregister.
Contact name Contact number
( )
Email Address
@
tax File number / Australian Business number tax File number of Security Holder #2 (Joint Holdings only)
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declaration and statements:

(1) i/We declare that all details and statements made by me/us are complete and accurate.

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

REGiStRY DAtE StAMP
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(2) i/We agree to be bound by the Terms & conditions set out in the prospectus and by the constitution of the company.
(3) i/We authorise the company to complete and execute any documentation necessary to effect the issue of securities to me/us.
(4) i/We have received personally a copy of the prospectus accompanied by or attached to this application form, or a copy of the application form or a direct derivative of the application form before applying for the securities.
(5) i/We acknowledge that the company will send me/us a paper copy of the prospectus and any supplementary prospectus (if applicable) free of charge if i/we request so during the currency of the prospectus.
(6) i/We acknowledge that returning the application form with the application monies will constitute my/our offer to subscribe for securities in the company and that no notice of acceptance of the application will be provided.

e & o.e.

To meeT The reQuiremenTs of The corporaTions acT, This form musT noT Be handed To any person unless iT is aTTached To or accompanied By The prospecTus daTed 30 June 2011 and any releVanT supplemenTary prospecTus.

this Application Form relates to the offer of Fully Paid Shares in terranova Minerals Limited pursuant to the Prospectus dated 30 June 2011.

APPLiCAtion FoRMS

please complete all parts of the application form using BlocK leTTers. use correct forms of registrable name (see below). applications using the wrong form of name may be rejected. current chess participants should complete their name and address in the same format as they are presently registered in the chess system. insert the number of shares you wish to apply for. The application must be for a minimum of 10,000 shares and thereafter in multiples of 1,000 shares. The applicant(s) agree(s) upon and subject to the terms of the prospectus to take any number of shares equal to or less than the number of shares indicated on the application form that may be allotted to the applicants pursuant to the prospectus and declare(s) that all details of statements made are complete and accurate.

no notice of acceptance of the application will be provided by the company prior to the allotment of shares. applicants agree to be bound upon acceptance by the company of the application.

please provide us with a telephone contact number (including the person responsible in the case of an application by a company) so that we can contact you promptly if there is a query in your application form. if your application form is not completed correctly, it may still be treated as valid. There is no requirement to sign the application form. The company’s decision as to whether to treat your application as valid, and how to construe, amend or complete it shall be final.

PAYMEnt

all cheques should be made payable to “Terranova minerals limited -share offer account” and drawn on an australian bank and expressed in australian currency and crossed “not negotiable”. cheques or bank drafts drawn on overseas banks in australian or any foreign currency will noT be accepted. any such cheques will be returned and the acceptance deemed to be invalid.

sufficient cleared funds should be held in your account as your acceptance may be rejected if your cheque is dishonoured. do not forward cash as receipts will not be issued.

LoDGinG oF APPLiCAtionS

completed application forms and cheques must be:

Posted to: oR Delivered to: Terranova minerals limited Terranova minerals limited c/- security Transfer registrars pty ltd c/- security Transfer registrars pty ltd po Box 535 770 canning highway applecross Wa 6953 applecross Wa 6153

Applications must be received by no later than 5.00pm WSt on the Closing Date 1 AuGuSt 2011 which may be changed immediately after the opening Date at any time and at the discretion of the Company.

CHESS Hin/BRoKER SPonSoRED APPLiCAntS

The company intends to become an issuer sponsored participant in the asX chess system. This enables a holder to receive a statement of holding rather than a certificate. if you are a chess participant (or are sponsored by a chess participant) and you wish to hold shares allotted to you under this application on the chess subregister, enter your chess hin. otherwise, leave this box blank and your shares will automatically be issuer sponsored on allotment.

tAX FiLE nuMBERS

The collection of tax file number (“Tfn”) information is authorised and the tax laws and the privacy act strictly regulate its use and disclosure. please note that it is not against the law not to provide your Tfn or claim an exemption, however, if you do not provide your Tfn or claim an exemption, you should be aware that tax will be taken out of any unfranked dividend distribution at the maximum tax rate.

if you are completing the application with one or more joint applicants, and you do not wish to disclose your Tfn or claim an exemption, a separate form may be obtained from the australian Taxation office to be used by you to provide this information to the company. certain persons are exempt from providing a Tfn. for further information, please contact your taxation adviser or any Taxation office.

CoRRECt FoRM oF REGiStRABLE titLE

note that only legal entities are allowed to hold securities. applications must be in the name(s) of a natural person(s), companies or other legal entities acceptable to Terranova minerals limited. at least one full given name and the surname are required for each natural person. The name of the beneficiary or any other nonregistrable name may be included by way of an account designation if completed exactly as described in the example of the correct forms of registrable names below:

tYPE oF inVEStoR	CoRRECt	inCoRRECt
individual	mr John alfred smith	J a smith
use given names in full, not initials.
Company	aBc pty ltd	aBc p/l or aBc co
use the company’s full title, not abbreviations.
Joint Holdings	mr peter robert Williams &	peter robert &
use full and complete names.	ms louise susan Williams	louise s Williams
trusts	mrs susan Jane smith	sue smith family Trust
use trustee(s) personal name(s), do not use the name of the trust.
Deceased Estates	ms Jane mary smith &	estate of late John smith
use the executor(s) personal name(s).	mr frank William smith	or
		John smith deceased
Minor (a person under the age of 18)	mr John alfred smith	master peter smith
use the name of a responsible adult with an appropriate designation.
Partnerships	mr John robert smith &	John smith and son
use the partners’ personal names. do not use the name of the partnership	mr michael John smith

Superannuation Funds	Jane smith pty ltd	Jane smith pty ltd superannuation fund
use the name of the trustee(s) of the super fund.

priVacy sTaTemenT personal information is collected on this form by security Transfer registrars pty ltd as the registrar for securities issuers for the purpose of maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. your personal details may be disclosed to related bodies corporate, to external service providers such as mail and print providers, or as otherwise required or permitted by law. if you would like details of your personal information held by security Transfer registrars pty ltd or you would like to correct information that is inaccurate please contact them on the address on this form.

APPLICATION FORM

This documenT is imporTanT. if you are in douBT as To hoW To deal WiTh iT, please conTacT your sTocK BroKer or licensed professional adVisor.

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declaration and statements:

(1) i/We declare that all details and statements made by me/us are complete and accurate.

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

REGiStRY DAtE StAMP
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(2) i/We agree to be bound by the Terms & conditions set out in the prospectus and by the constitution of the company.
(3) i/We authorise the company to complete and execute any documentation necessary to effect the issue of securities to me/us.
(4) i/We have received personally a copy of the prospectus accompanied by or attached to this application form, or a copy of the application form or a direct derivative of the application form before applying for the securities.
(5) i/We acknowledge that the company will send me/us a paper copy of the prospectus and any supplementary prospectus (if applicable) free of charge if i/we request so during the currency of the prospectus.
(6) i/We acknowledge that returning the application form with the application monies will constitute my/our offer to subscribe for securities in the company and that no notice of acceptance of the application will be provided.

e & o.e.

this Application Form relates to the off er of Fully Paid Shares in terranova Minerals Limited pursuant to the Prospectus dated 30 June 2011.

APPLiCAtion FoRMS

no notice of acceptance of the application will be provided by the company prior to the allotment of shares. applicants agree to be bound upon acceptance by the company of the application.

PAYMEnt

all cheques should be made payable to “Terranova minerals limited -share off er account” and drawn on an australian bank and expressed in australian currency and crossed “not negotiable”. cheques or bank drafts drawn on overseas banks in australian or any foreign currency will noT be accepted. any such cheques will be returned and the acceptance deemed to be invalid.

suffi cient cleared funds should be held in your account as your acceptance may be rejected if your cheque is dishonoured. do not forward cash as receipts will not be issued.

LoDGinG oF APPLiCAtionS

completed application forms and cheques must be:

CHESS Hin/BRoKER SPonSoRED APPLiCAntS

The company intends to become an issuer sponsored participant in the asX chess system. This enables a holder to receive a statement of holding rather than a certifi cate. if you are a chess participant (or are sponsored by a chess participant) and you wish to hold shares allotted to you under this application on the chess subregister, enter your chess hin. otherwise, leave this box blank and your shares will automatically be issuer sponsored on allotment.

tAX FiLE nuMBERS

The collection of tax fi le number (“Tfn”) information is authorised and the tax laws and the privacy act strictly regulate its use and disclosure. please note that it is not against the law not to provide your Tfn or claim an exemption, however, if you do not provide your Tfn or claim an exemption, you should be aware that tax will be taken out of any unfranked dividend distribution at the maximum tax rate.

if you are completing the application with one or more joint applicants, and you do not wish to disclose your Tfn or claim an exemption, a separate form may be obtained from the australian Taxation offi ce to be used by you to provide this information to the company. certain persons are exempt from providing a Tfn. for further information, please contact your taxation adviser or any Taxation offi ce.

CoRRECt FoRM oF REGiStRABLE titLE

note that only legal entities are allowed to hold securities. applications must be in the name(s) of a natural person(s), companies or other legal entities acceptable to Terranova minerals limited. at least one full given name and the surname are required for each natural person. The name of the benefi ciary or any other nonregistrable name may be included by way of an account designation if completed exactly as described in the example of the correct forms of registrable names below:

tYPE oF inVEStoR	CoRRECt	inCoRRECt
individual	mr John alfred smith	J a smith
use given names in full, not initials.
Company	aBc pty ltd	aBc p/l or aBc co
use the company’s full title, not abbreviations.
Joint Holdings	mr peter robert Williams &	peter robert &
use full and complete names.	ms louise susan Williams	louise s Williams
trusts	mrs susan Jane smith	sue smith family Trust
use trustee(s) personal name(s), do not use the name of the trust.
Deceased Estates	ms Jane mary smith &	estate of late John smith
use the executor(s) personal name(s).	mr frank William smith	or
		John smith deceased
Minor (a person under the age of 18)	mr John alfred smith	master peter smith
use the name of a responsible adult with an appropriate designation.
Partnerships	mr John robert smith &	John smith and son
use the partners’ personal names. do not use the name of the partnership	mr michael John smith

Superannuation Funds	Jane smith pty ltd	Jane smith pty ltd superannuation fund
use the name of the trustee(s) of the super fund.

This is a replacemenT prospecTus daTed 7 July 2011. iT replaces The prospecTus daTed 30 June 2011 relaTing To The shares of TerranoVa minerals limiTed

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Terranova Minerals Limited

po Box 7653 cloisters square perth Wa 6850 Telephone: +61 8 9486 4699 facsimile: +61 8 9486 4799 email: [email protected]

AI assistant

ORE RESOURCES LIMITED — Capital/Financing Update 2011

65504_rns_2011-08-29_6c5199bd-77fd-46b4-9409-4e1f98ff5ea7.pdf

Replacement Prospectus

IMPORTANT NOTICE

WEB SITE – ELECTRONIC PROSPECTUS

EXPOSURE PERIOD

COMPETENT PERSONS STATEMENT

Investment Overview

THE COMPANY

THE OFFER

INDICATIVE TIMETABLE

PURPOSE OF THE OFFER

Investment Overview (continued)

USE OF PROCEEDS

Investment Overview (continued)

CAPITAL STRUCTURE

Notes:

INVESTMENT HIGHLIGHTS

RESTRICTED SECURITIES

Investment Overview (continued)

Investment Overview (continued)

KEY RISKS

Status of Tenements

Dilution Risk

Risk Area Risks

Investment Overview (continued)

FINANCIAL INFORMATION

DIRECTORS

Mr Matthew Foy

Investment Overview (continued)

INTERESTS OF DIRECTORS IN THE COMPANY’S SECURITIES

Notes:

REMUNERATION OF DIRECTORS

Investment Overview (continued)

AGREEMENTS WITH DIRECTORS OR RELATED PARTIES

Services Agreement – Matthew Foy

Services Agreement – Benjamin Bussell

Services Agreement – Robert Jewson

Deeds of Indemnity, Insurance and Access

Investment Overview (continued)

SUBSTANTIAL SHAREHOLDERS

notes.

notes.

Investment Overview (continued)

EXPENSES OF THE OFFER

DIVIDEND POLICY

Corporate Directory

DIRECTORS

INVESTIGATING ACCOUNTANT

LAWYERS

COMPANY SECRETARY

REGISTERED OFFICE

INDEPENDENT GEOLOGIST

WEBSITE

CORPORATE ADVISOR

SHARE REGISTRY*

PROPOSED ASX CODE

Chairman’s Letter

Benjamin Bussell

Details of the Offer

3.1 THE OFFER

3.2 APPLICATIONS

3.3 ALLOTMENT

3.4 ASX LISTING

3.5 APPLICANTS OUTSIDE AUSTRALIA

Details of the Offer (continued)

3.6 MINIMUM SUBSCRIPTION

3.7 UNDERWRITER

3.8 COMMISSIONS ON APPLICATION FORMS

3.9 CHESS

3.11 PRIVACY STATEMENT

3.10 FORECAST FINANCIAL INFORMATION

04

Company and Project Overview

4.1 COMPANY OVERVIEW

4.3 OVERVIEW AND LOCATION OF CRAWFORD PROJECT

Company and Project Overview (continued)

4.4 FURTHER INFORMATION

4.5 OTHER PROJECTS

ORE RESOURCES LIMITED Capital/Financing Update 2011