PEEL MINING LIMITED — Capital/Financing Update 2007

Oct 2, 2007

ASX and Media Release

3 October 2007

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Peel granted Attunga Project – exploration now underway

Exploration Update

Peel Exploration Ltd (ASX:PEX) is pleased to announce it has extended its footprint of precious and base metal projects in NSW following the granting of exploration licences covering the Attunga Intrusive-Related Gold System (IRGS).

The two licences comprising the Attunga Project (EL6883 and EL6884) are located approximately 20 km north of Tamworth and cover a combined area of about 250km[2] . The project area contains numerous historic gold, tungsten and molybdenum prospects.

Peel Exploration has already commenced exploration activity on the Attunga Project.

An independent expert review completed by Dr Tim Baker (former lecturer in Economic Geology at James Cook University) supports Peel Exploration’s opinion with regard to the geological model relevant to the Attunga region. In his report Dr Baker stated that an intrusion-related gold model is readily applicable, and that prospects in the region contain metal signatures common to IRGS. He also noted that the wide variety of mineralisation styles present at Attunga is a common feature of intrusion centred systems.

Since lodgement of the Attunga Project exploration licence applications in late June, Peel Exploration has been active with developments including :

• key landholder negotiations,

• GIS data capture and initial desktop studies,

• initial ore deposit modelling at Prospect 1 tungsten-molybdenum skarn deposit,

• re-logging and re-sampling of Prospect 1 diamond drillcore,

• location and retrieval of missing diamond drillcore from the Kensington goldtungsten prospect, and

• first-pass rock chip sampling (25 samples) to test the validity of previously

• defined geochemical anomalies.

Peel Exploration plans to move forward rapidly with the exploration of the Attunga Intrusive-Related Gold System. Gold assay results from the initial rock-chip sampling programme are expected soon. Peel Exploration will also seek to re-log and re-sample the recently located Kensington diamond drillcore. Additional exploration results will be reported as they come to hand.

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Rob Tyson Executive Director.

Peel Exploration Limited (ACN 119 343 734)

Telephone (08) 9382 3955 Facsimile (08) 9388 1025 Email info@peelex.com.au Level 1, 79 Hay Street, Subiaco, Western Australia 6008

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Peel Exploration’s Attunga Project Location Map

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Peel Exploration Limited (ACN 119 343 734) Telephone (08) 9382 3955 Facsimile (08) 9388 1025 Email info@peelex.com.au Level 1, 79 Hay Street, Subiaco, Western Australia 6008

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About Peel Exploration Ltd

Peel Exploration is a newly listed precious and base metals explorer with four 100%owned tenements covering 700 km[2] in the New England Fold Belt region of northern New South Wales.

Peel Exploration believes the New England Fold Belt, particularly the portion located in northern NSW, represents a unique opportunity for exploration. The area has a rich mining history with numerous mineral discoveries including Mount Morgan, Gympie, Mount Rawdon, Cracow, Hillgrove, Timbarra and Twin Hills. Yet despite this rich mineral endowment, the Belt remains poorly explored with minimal modern exploration.

The Company’s portfolio of 100% owned exploration licences comprises:

1. The Attunga Project (EL6883 & EL6884), containing numerous historic gold, tungsten and molybdenum prospects. The Attunga Project exhibits the hallmarks of an Intrusive-Related Gold System.

2. The Dungowan Project (EL6613), containing five historic copper mines and workings. High grade copper mineralisation was reported from the Fishers copper mine with 2,643 tonnes of ore extracted at an average grade of 13.4% copper.

3. The Barry Project (EL6614), centred on a cluster of copper and molybdenum workings. Exploration in the 1970’s returned copper values averaging some 1.7%.

4. The Waverley Project (EL6719), centred on the historic Waverley silver-lead-zinc workings and an associated magnetic anomaly. Prospecting in the mid 1990’s returned anomalous values of up to 739 ppm silver, 14.6% zinc and 9.4% lead.

5. The Armidale Project (EL6722), containing several historic silver mines along with numerous gold, antimony, tungsten and molybdenum workings. The area also hosts a large untested gravity anomaly which will receive exploration priority.

The Company believes the prospects offer excellent potential for the discovery of economic gold, tungsten, molybdenum, copper, zinc, lead and silver, with most prospects being polymetallic in nature.

For further information, please contact:

Rob Tyson Warrick Hazeldine Executive Director – Peel Exploration Purple Communications Tel: 08 9382 3955 Tel: 08 9485 1254 Mob: 0417 944 616

The information in this report that relates to Exploration Results is based on information compiled by Mr Robert Tyson, who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Tyson 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 Tyson consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

Peel Exploration Limited (ACN 119 343 734) Telephone (08) 9382 3955 Facsimile (08) 9388 1025 Email info@peelex.com.au Level 1, 79 Hay Street, Subiaco, Western Australia 6008

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Peel Exploration’s Project Location Map

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Peel Exploration Limited (ACN 119 343 734) Telephone (08) 9382 3955 Facsimile (08) 9388 1025 Email info@peelex.com.au Level 1, 79 Hay Street, Subiaco, Western Australia 6008