PEEL MINING LIMITED — Capital/Financing Update 2007

Apr 1, 2007

PEEL EXPLORATION LIMITED

ACN 119 343 734

PROSPECTUS

For the offer of 15,000,000 Shares at an issue price of \$0.20 each to raise \$3,000,000

IMPORTANT INFORMATION

This is an important document that should be read in its entirety. If you do not understand it you should consult your professional advisers without delay. The Shares offered by this Prospectus should be considered speculative.

IMPORTANT NOTICE

This Prospectus is dated 21 March 2007 and was lodged with the ASIC on that date. 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 this 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 (7) 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.peelex.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 securities 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.

CONTENTS

$\mathbf{L}$	CORPORATE DIRECTORY
2.	CHAIRMAN'S LETTER
3.	INVESTMENT OVERVIEW
4.	DETAILS OF THE OFFER
5.	COMPANY AND PROJECT OVERVIEW
6.	INDEPENDENT GEOLOGIST'S REPORT
7.	INVESTIGATING ACCOUNTANT'S REPORT
8.	SOLICITOR'S REPORT ON TENEMENTS
9.	RISK FACTORS
10.	ADDITIONAL INFORMATION
$\mathbf{H}$ .	DIRECTORS' AUTHORISATION
12.	GLOSSARY

$\mathbf{L}$ CORPORATE DIRECTORY

Directors

Michael Kiernan Non-Executive Chairman

Rob Tyson Executive Director

Simon Hadfield Non-Executive Director

Company Secretary

David Hocking

Share Registry*

Computershare Investor Services Ptv Ltd Level 2, Reserve Bank Bullding 45 St Georges Terrace Perth WA 6000

Telephone: 1300 664 593 Facsimile: (08) 9323 2033

Solicitors to the Company

Steinepreis Paganin Lawyers and Consultants Level 4, Next Building 16 Milligan Street Perth WA 6000

Registered Office

Auditors and Investigating Accountant

Level 1, 79 Hay Street Subiaco WA 6008

Telephone: (08) 9382 3955 Facsimile: (08) 9388 1025

Website

www.peelex.com.au

Horwarth Audit (WA) Pty Ltd* & Horwath (WA) Pty Limited 128 Hay Street Subjaco WA 6008

Independent Geologist

Geological and Management Services Pty Ltd Unit 7, Level 3 Charles Plaza 66 King St Sydney NSW 2000

* This entity is included for information purposes only. It has not been involved in the preparation of this Prospectus.

$2¹$ CHAIRMAN'S LETTER

Dear Investor.

On behalf of the Directors of Peel Exploration Limited, it is my pleasure to introduce our Prospectus. Peel Exploration was incorporated in April 2006 for the purpose of acquiring precious and base metals-prospective tenure in the New England Fold Belt of eastern Australia.

The Company has since secured four key project areas representing about 700 square kilometres of granted tenure.

We believe that the New England Fold Belt, particularly the portion located in northern New South Wales, represents a unique opportunity for mineral 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 techniques having been utilised.

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

• $\mathbb{I}$ . The Dungowan Prospect - EL6613 contains five historic copper mines and workings. High grade copper mineralisation was reported from the Fishers copper mine (operated by a private syndicate in the late 1960's) with 2,643 tonnes of ore extracted at an average grade of 13.4% copper.
• $2₁$ The Barry Prospect - EL6614 is centred on a cluster of copper and molvbdenum workings. Exploration in the 1970's returned copper values averaging some 1.7%.
• 1. The Waverley Prospect - EL6719 is centred on the historic Waverley silver-leadzinc 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.
• $\mathbf{A}_{\cdot}$ The Armidale Prospect - EL6722 contains several historic silver mines alona with numerous gold, antimony, tungsten and molybdenum workings. The area also hosts a large untested gravity anomaly which will receive exploration priority.

On behalf of the Directors I am pleased to invite you to join us as a shareholder and participate in this grass roots opportunity to share in our exciting exploration journey - the Peel Exploration journey.

Yours faithfully

Michael Kiernan

Chairman

21 March 2007

$3₁$ INVESTMENT OVERVIEW

$3.1$ Important Notice

This section 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.

$3.2$ Objective

Peel's key objective is to substantially grow shareholder wealth through the discovery of precious and/or base metals deposits by:

• focusing exploration activities on under-explored geological regions with proven mineral endowment;
• conducting exploration in areas with known historic base and precious metals mines, workings and prospects that have been subject to only minimal modern exploration;
• minimising corporate overheads and expenses; and
• seeking other mineral opportunities as and when they come to hand.

The Company will continue with the exploration and evaluation of its four Exploration Licences in the New England Fold Belt region of northern New South Wales with a focus on promptly and systematically testing the potential of the numerous precious and base metals prospects further described herein.

On completion of the Offer, the Board believes the Company will have sufficient working capital to achieve these objectives.

$3.3$ Indicative Timetable

Lodgement of Prospectus with the ASIC	21 March 2007
Opening Date	29 March 2007
Closing Date	5.00pm WST on 30 April 2007
Despatch of Holding Statements	4 May 2007
Expected date for listing on ASX	9 May 2007

$34$ Purpose of the Offer and Use of Proceeds

It is intended to apply funds raised from the Offer as follows (assuming the Offer is fully subscribed to raise \$3,000,000):

	Year 1	Year 2	Total
Evaluation and exploration	\$969,000	\$864,000	\$1,833,000
Expenses of issue	\$250,000		\$250,000
Administration Costs	\$150,000	\$150,000	\$300,000
Project generation	\$100,000	\$100,000	\$200,000
Unallocated working capital	\$208,500	\$208,500	\$417,000
Total	\$1,677,500	\$1,322,500	\$3,000,000

The above table is 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) 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.

Following completion of the Offer, the Company will have sufficient working capital to carry out its stated objections.

$3.5$ Capital Structure

The capital structure of the Company following completion of the Offer is summarised below1:

Shares	Number
Shares on issue at date of Prospectus	15,000,000
Shares now offered	15,000,000
Total Shares on issue at completion of the Offer 2	30,000,000
Options 3
Options on issue at date of Prospectus 4	15,000,000

Total Options on issue at completion of the Offer?	15,000,000
Options now offered	Nii
Options on issue an agro on incoprocide	, , , , , , , , , , , , , , , , , , ,

Notes:

¹ Refer to Investigating Accountant's Report for further information.

² Assumes that the Offer is fully subscribed.

³ Following completion of the Offer and successful listing of the Company's Shares on ASX, the Directors propose to proceed with a rights issue of Options to all Shareholders registered on that date which is approximately two months after the date the Company's Shares commence trading on ASX. Please refer to Section 4.7 for further details.

47,500,000 of these Options have an exercise price of \$0.30 each and 7,500,000 of these Options have an exercise price of \$0.20. Both classes of Options have an expiry date of 30 November 2010. Please refer to Section 10.2 for further details.

Restricted securities

Subject to the Company being admitted to the Official List, certain of the Shares on issue prior to the Offer and certain of the Shares issued on the exercise of the Options on issue prior to the Offer, are likely to be classified by ASX as restricted securities and will be required to be held in escrow.

$\Delta$ . DETAILS OF THE OFFER

4.1 The Offer

By this Prospectus, the Company offers for subscription up to 15,000,000 Shares at \$0,20 cents each to raise up to \$3,000,000.

The Shares offered under this Prospectus will rank equally with the existing Shares on issue.

$4.2$ Applications

Applications for Shares under the Offer must be made using the Application Form.

Payment for the Shares must be made in full at the issue price of \$0.20 cents 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:

Computershare Investor Services Pty Ltd Level 2, Reserve Bank Building 45 St Georges Terrace Perth WA 6000

or

Computershare Investor Services Pty Ltd GPO Box D182 Perth WA 6840

Cheques should be made payable to "Peel Exploration Limited - Share Trust 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.

4.3 Oversubscriptions

No oversubscriptions will be accepted.

4.4 Allotment

Subject to ASX aranting approval for the Company to be admitted to the Official List, 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.

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 within seven (7) days of the allotment date.

4.5 Minimum Subscription

The minimum subscription to be raised pursuant to this Prospectus is \$3,000,000.

If the minimum subscription has not been raised within four (4) months after the date of this Prospectus, all applications will be dealt with in accordance with the Corporations Act.

4.6 ASX Listing

The Company will apply to ASX within seven (7) 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 ASX does not arant permission for Official Quotation of the Shares within three (3) months after the date of this Prospectus, or such longer period as is permitted by the Corporations Act, none of the Shares offered by this Prospectus will be allotted or issued. In that circumstance, all applications will be dealt with in accordance with the Corporations Act.

4.7 Rights Issue of Options post Listing

The Directors propose to proceed with a rights issue of Options on a one (1) for two (2) basis at an issue price of 1 cent per Option to all Shareholders registered on the share register at that date which is approximately two months after the Shares commence trading on ASX. The Company will apply to ASX to have these Options listed for Official Quotation. Each Option will be exercisable at \$0.20 on or before 30 November 2010.

A disclosure document will be made available when the Options referred to above are offered by the Company. Anyone who wants to acquire Options under the rights issue will need to complete an application form that will be in, or will accompany, the disclosure document.

4.8 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 these 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.

4.9 Underwriter

The Offer is not underwritten.

4.10 Commissions on Application Forms

The Company reserves the right to pay a commission of 5% (inclusive of goods and services tax) of amounts subscribed to any Australian Financial Services licensees in respect of valid applications lodged and accepted by the Company and bearing the stamp of the Australian Financial Services licensee. Payments will be subject to the receipt of a proper tax invoice from the Australian Financial Services licensee.

4.11 CHESS

The Company will apply to participate in the Clearing House Electronic Subregister System (CHESS). CHESS is operated by ASX Settlement and Transfer Corporation Pty Ltd (ASTC), a wholly owned subsidiary of ASX, in accordance with the Listing Rules and the ASTC Settlement Rules.

Under CHESS, the Company will not issue certificates to investors. Instead, Share and Option holders will receive a statement of their holdinas in the Company. If an investor is broker sponsored, ASTC will send a CHESS statement.

4.12 Risk factors

Prospective investors in the Company should be aware that subscribing for securities the subject of this Prospectus involves a number of risks. These risks are set out in Section 9 of this Prospectus and investors are urged to consider those risks carefully (and if necessary, consult their professional adviser) before deciding whether to invest in the Company.

The risk factors set out in Section 9, and other general risks applicable to all investments in listed securities not specifically referred to, may in the future affect the value of the Securities. Accordingly, an investment in the Company should be considered speculative.

4.13 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; mall 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 ASTC Settlement Rules. You should note that if you do not provide the information required on the application for Securities, the Company may not be able to accept or process your application.

5. COMPANY AND PROJECT OVERVIEW

$5.1$ Introduction

Peel Exploration has been established primarily to explore for deposits of gold, silver, copper, zinc and lead. Secondary targets include tungsten, tin, molybdenum, bismuth and antimony. The Company has identified the New England Fold Belt, particularly the portion located within northern New South Wales, as a highly prospective and under-explored region.

The New England Fold Belt (NEFB) has a rich mining history with numerous major mineral discoveries including Mount Morgan, Gymple, Mount Rawdon, Cracow, Hillgrove, Timbarra and Twin Hills. Despite this obvious endowment, the NEFB has been subject to surprisinaly little modern exploration.

Figure 1 - Project Locations

The Company has a portfollo of four 100%-owned Exploration Licences comprising:

EL 6613 contains numerous historic copper mines/workings. High-grade copper mineralisation was reported from Fishers copper mine, with 2,643t of ore produced at an average grade of 13.4% copper while at nearby Trough Gully copper mine, the lode finished in massive sulphide mineralisation.

• EL 6614 is centred on a cluster of copper and molybdenum workings. Exploration in 1971 returned significant copper values, including 27 samples averaging 1.7% copper and 21 samples averaging 1.9% copper.
• EL 6719 is centred on the historic Waverley silver-lead-zinc workings and an associated magnetic anomaly. Prospecting at Waverley in the mid-1990s by the only previous recorded explorer returned highly anomalous silver, lead and zinc values.
• EL 6722 contains several historic silver mines alona with numerous gold, antimony, tungsten and molybdenum workings. The area also hosts a very large untested gravity anomaly.

$5.2$ Defails on the Assets

EL 6613

EL 6613 covers an area of approximately 252 square kilometres and is located 300 kilometres north of Sydney in the New England Fold Belt of eastern Australia, or about 15 kilometres east of Tamworth, New South Wales. Within EL 6613, there are two specific project areas of interest; numerous historic copper mines/workings in the vicinity of Dungowan as well as a number of historic gold workings in the vicinity of Limbri.

The licence area is considered prospective for polymetallic VHMS mineralisation, syngenetic (volcanic-related), exhalative gold mineralisation, and epigenetic structurally-controlled gold mineralisation related to regional deformation, metamorphism and aranite-intrusive phases.

Dungowan Project

The Dungowan project area, in the central portion of the EL 6613, is host to numerous historic copper mines and workings. The most significant copper deposits - Fishers (also known as Dungowan), Trough Gully, Mulla Creek, Woolomin, and Mt Pleasant - were mostly worked about the turn of the 20th Century, and appear to represent polymetallic VHMS mineralisation.

The polymetallic (copper-zinc-silver-gold) deposits all share common characteristics indicating a common origin. They are largely conformable with the enclosing sediments and volcanics, occurring as lenses (either singly or in groups) measuring up to 60 metres long and up to 4 metres thick, and extending down to at least 40 metres. The sulphide lenses are invariably closely associated with mafic volcanics, jaspers and cherts. Development of supergene enriched copper zones (chalcocite) is a feature of the Mulla Creek and Fishers deposits.

Fishers (aka Dungowan) copper mine was worked between 1899-1900, and 1968-1974 for reported production of 2,643 tonnes at an average grade of 13.4% copper. The main lode (Cathedral stope) was reportedly at least 23m long and up to 3m wide. A series of exploration programmes (including New South Wales Geological Survey investigations) completed in the late 1960s/early 1970s culminated in drilling in 1972 comprising 11 holes for 382m. Peel Exploration believes that the drilling insufficiently tested the deposit - the deepest hole being 56m. No significant exploration has been completed since that time.

Figure 2 - EL 6613 Location, Geology and Mineral Deposits

Trough Gully copper mine was worked between 1899-1916 for reported production of 2,752 tonnes ore. Workings were reportedly up to 14 ft in width, at least 140 ft in length and 100 ft in proven depth. The lode finished in mineralisation and remains open to the north, south and down dip. Eight underground channel samples taken by the New South Wales Geological Survey returned average grades of 2.2% copper, 1.2% zinc, 13ppm silver, and trace gold.

Mulla Creek copper mine was worked between 1911-1913 for secondary copper ore, with further driving and sinking between 1968-1979. The copper mineralisation is believed to extend over a strike length of 150 m.

Woolomin copper prospect was worked between 1910-1912 for secondary copper while Mt Pleasant copper prospect also produced minor secondary copper.

Peel Exploration believes that these historic copper deposits are highly prospective for polymetallic VHMS mineralisation. The close proximity of the deposits indicates a strong metallogenic environment, and provides the opportunity to define multiple small-medium sized, high grade polymetallic orebodies.

Limbri Project

The Limbri project area in the northern end of EL 6613 comprises a series of historic gold workings (some with associated manganese) which appear to be hosted by jasperoidal chert horizons of the Woolomin Beds. The chert horizons that host the aold mineralisation can extend for hundreds of metres to kilometres along strike, and therefore represent potentially large target areas. The Limbri area has been subject to some small-scale mining during the early to mid 1900s. A number of small gold plus manganese workings occur around the town of Limbri and gold anomalous sedimentary rocks (mainly cherts and jaspers) have been reported in the area by previous explorers.

Peel Exploration believes that the Limbri area is potentially prospective for syngenetic (volcanic-related), exhalative gold mineralisation; and/or epigenetic structurally-controlled gold mineralisation related to regional deformation, metamorphism and granite-intrusive phases. The Company believes that the area has not been adequately tested and holds potential for economic gold mineralisation.

$\lnot$ ACTIVITY $\lnot$	EXAMPLE YEAR 2 TOTAL
	\$	\$	\$
Field mapping and surveys	15,000	10,000	25,000
Geochemistry surveys and analysis	15,000	15,000	30,000
Geophysical surveys and analysis	110,000	20,000	130,000
Drilling	60,000	80,000	140,000
Drill assays and downhole geophysics	18,000	24,000	42,000
GIS and data compilation	15,000	15,000	30,000
Geological and field staff wages and consultants	25,000	25,000	50,000
Field support and vehicles	15,000	15,000	30,000
TOTALS	$-273,000$	204,000	477.000

Table 1: EL 6613 Proposed Expenditure

EL 6614 covers an area of approximately 48 square kilometres and is located 260 kilometres north of Sydney in the New England Fold Belt of eastern Australia, or about 25 kilometres southeast of Nundle, New South Wales.

Within EL 6614 is the Barry project; an area which is considered prospective for polymetallic VHMS mineralisation and intrusive-related precious/base metal mineralisation.

Figure 3 - EL 6614 Location, Geology and Mineral Deposits

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Barry Project

The Barry project area is host to several historic copper and molybdenum workings and occurrences. The project area at Barry is centred on the highly faulted Barry Igneous Complex which includes serpentinite, mafic and acid igneous rocks, containing porphyries, granophyres and trondhiemites.

The Barry area has been subject to only limited modern exploration. Exploration was conducted in the region between 1970-1972, examining gold, copper and molybdenum prospects. In 1971, a series of assay results (within a programme of 376 samples) from the Barry area were reported to have returned strong traces of copper mineralisation along an apparent strike of approximately 2 miles. It was also reported that copper mineralisation could well be expected at depth over a strike length of some 2,000 ft. Within the assay results, several series of consecutive results returned high grade copper values, which included; 27 samples averaging 1.7% copper, 21 samples averaging 1.92% copper (plus significant silver and gold). 4 samples averaging 1,1% copper, 3 samples averaging 1.2% copper and 11 samples averaging 3.2% copper. The sample location map that accompanied the report is missing, along with all statutory reporting of exploration thereafter (covering a further 18 months). No follow-up exploration of these results has ever been reported.

Experience ACTIVITY ACTIVITY	WELLWAYEAR 1. MAYEAR 2. A		$\cdot$ total $\sim$
Field mapping and surveys	\$10,000	\$10,000	\$20,000
Geochemistry surveys and analysis	\$10,000	\$10,000	\$20,000
Geophysical surveys and analysis	\$50,000	\$10,000	\$60,000
Drilling	\$40,000	\$60,000	\$100,000
Drill assays and downhole geophysics	\$12,000	\$18,000	\$30,000
GIS and data compilation	\$8,000	\$8,000	\$16,000
Geological and field staff wages and consultants	\$20,000	\$20,000	\$40,000
Field support and vehicles	\$10,000	\$10,000	\$20,000
$$160,000 - $146,000 = $306,000$ TOTALS

Table 2: EL 6614 Proposed Expenditure

EL 6719

EL 6719 covers an area of approximately 100 square kilometres and is located 230 kilometres north of Sydney in the New England Fold Belt of eastern Australia, or about 40 kilometres northeast of Scone, New South Wales. The licence encompasses the historic Waverley silver-lead-zinc workings and a large untested magnetic anomaly proximal to the Waverley workings.

The licence area is considered prospective for intrusive-related precious-base metal mineralisation.

Waverley Project

The Waverley project area hosts the historic Waverley silver-lead-zinc workings which comprises pits, shafts and adits. Production was undertaken intermittently between 1868 and 1912. Mineralisation at Waverley has been recorded as being associated with a three kilometre long NNE trending fault zone.

New South Wales Geological Survey inspections report that the mineralisation comprised a series of pods and lenses, with pods reportedly measuring up to a maximum of 20m long and 3m wide.

Prospecting in the mid-1990s by the only known explorer of the region returned values up to 739ppm silver, 14% zinc and 9.4% lead. Mineralisation at Waverley appears to exhibit epithermal characteristics and the area also hosts a large untested magnetic anomaly proximal to the workings.

Figure 4 - EL 6719 Total Magnetic Intensity

Table 3: EL 6719 Proposed Expenditure

ACTIVITY ACTIVITY ACTIVITY ACTIVITY ACTIVITY ACTIVITY ACTIVITY ACTIVITY
Field mapping and surveys	\$15,000	\$10,000	\$25,000
Geochemistry surveys and analysis	\$15,000	\$10,000	\$25,000
Geophysical surveys and analysis	\$50,000	\$20,000	\$70,000
Drilling	\$40,000	\$60,000	\$100,000
Drill assays and downhole geophysics	\$12,000	\$18,000	\$30,000

TOTALS \$182,000 \$163,000 \$345,000
Field support and vehicles	\$15,000	\$15.000	- \$30.000
Geological and field staff wages and consultants	\$25,000	\$20,000	S45.000
GIS and data compilation	\$10,000	\$10,000	\$20,000

EL 6722

EL 6722 covers an area of approximately 300 square kilometres and is located 400 kilometres north of Sydney in the New England Fold Belt of eastern Australia, or about 5 kilometres north of Armidale, New South Wales. The licence encompasses the Armidale project which comprises numerous historic precious and base metals mines and workings, including three regionally-significant silver mines. EL 6722 abuts Straits Resources Limited's Hillgrove gold-antimony mine's regional exploration tenure.

The Company considers that the Armidale project is prospective for precious metals deposits.

Armidale Project

The Armidale project area covers numerous historic gold, silver, antimony, and tungsten mines and workings, including the Taits Gully silver-gold mine and the Greengate silver-lead-zinc mine. The application area also contains the historic Whybatong silver-gold mine (adjacent to Taits Gully) which remains covered by a small mining lease (not owned by the Company). Limited modern exploration has been completed in the area.

The Taits Gully silver-gold mine is situated 15 kilometres north of Armidale and comprises workings spread over a two kilometre area. The two largest workings, the Mary Ann and the Endeavour mines, were first worked in 1901 and 1910. respectively. During this time until 1914 (when the mine ceased owing to World War 1) at least 36,400 oz silver and 400 oz gold were reportedly recovered.

Exploration at Talts Gully in 1982 and in 1984 culminated in a small drilling programme with a best result of 7m at 48ppm silver, 0.6% zinc, 0.3% lead, and 0.2ppm gold from 54m returned. The Company believes that Taits Gully has not been adequately tested and that potential remains for the discovery of highgrade silver-gold mineralisation.

The Greengate silver-lead-zinc mine is located about 20 kilometres northwest of Armidale. Previous recorded exploration has been limited to small programs in 1966 and 1982. Historic rockchip assay results reveal anomalous levels of gold, silver, lead, zinc and copper with values of up to 36ppm silver, 2.3% lead and 4.5% zinc.

The area also hosts the Blue Moon gravity prospect, an untested six kilometrewide circular gravity anomaly, possibly representing a sub-volcanic chamber associated with a collapsed caldera, or a buried intrusive pluton. This anomaly represents a sizeable exploration target given its proximity to altered acid volcanics with associated precious metals values.

CUYRA! mana peel exploration ARMOALE

Figure 5 - EL 6722 Bouguer Gravity

Table 4: EL 6722 Proposed Expenditure

CONTROLL ACTIV	WEAR 1 STEAR 2 STOTAL ST
Field mapping and surveys	\$25,000	\$25,000	\$50,000
Geochemistry surveys and analysis	\$25,000	\$25,000	\$50,000
Geophysical surveys and analysis	\$110,000	\$20,000	\$130,000
Drilling	\$80,000	\$120,000	\$200,000
Drill assays and downhole geophysics	\$24,000	\$36,000	\$60,000
GIS and data compilation	\$25,000	\$25,000	\$50,000
Geological and field staff wages and consultants	\$40,000	\$60,000	\$100,000
Field support and vehicles	\$25,000	\$40,000	\$65,000
-------------------------------------- TOTALS.	\$354.000.	$-$ \$351,000	-- \$705.000

$5.3$ Directors

Michael Kiernan (57) Non-Executive Chairman

With more than 30 years experience in the mining and transport industries, Mr

Kiernan brings a wealth of knowledge and experience to the Peel board. Mr Kiernan retains the positions of chairman at Monarch Gold Mining Company Ltd, Uran Ltd, and Mineral Resources Ltd along with directorships at Matilda Minerals Ltd and Australian Zircon NL.

Rob Tyson (36) - BAppSc; GDAppFin; MAusIMM Executive Director

Mr Tyson is a qualified geologist with more than 15 years resources industry experience having worked in exploration and mining-related roles for companies including Cyprus Exploration Pty Ltd, Queensland Metals Corporation NL, Murchison Zinc Pty Ltd, Normandy Mining Ltd, and Equigold NL. Mr Tyson also has more than five years of senior management experience and retains the position of general manager at resources industry publisher and conference business, Resource Information Unit Pty Ltd.

Simon Hadfield (60) Non-Executive Director

Mr Hadfield has more than 30 vears experience manaaina medium and large companies including the holding of directorships at publicly-listed industrial and resource companies. Mr Hadfield is managing director of Resource Information Unit Pty Ltd.

David Hocking (61) Company Secretary

Mr Hocking is a qualified Chartered Accountant from the United Kingdom. He has more than 20 years commercial experience in Australia producing management and financial accounts for medium sized businesses in a range of industries including publishing, franchising, rural merchandising, financial services and the offshore oil industry. Mr Hocking also brings previous experience as a company secretary in a public company.

5.4 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.

$5.5$ The Board of Directors

The Company's Board of Directors is 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:

• maintain and increase Shareholder value: $(a)$
• $(b)$ 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.

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;
• $\left( c\right)$ 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 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.

5.6 Composition of the Board

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:

• the Board is to comprise Directors with a blend of skills, experience and $(a)$ 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.

5.7 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.

5.8 Remuneration arrangements

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 \$300,000 per annum.

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.

5.9 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.

5.10 Audit committee

The Company may appoint a separate constituted audit committee.

$5.11$ Identification and management of risk

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.

5.12 Ethical standards

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

6. INDEPENDENT GEOLOGIST'S REPORT

Geological and Management Services Pty Ltd

ABN 47 001 256 248

The Directors Peel Exploration Ltd Level 1, 69 Hay St Subiaco, WA 6008

Dear Sirs

Independent Experts Report

At your request Geological and Management Services Pty Ltd (hereinafter referred to as GMS) has prepared an Independent Geologist's Report on the Mineral Assets of Peel Exploration Limited located in the New England Region of New South Wales, Australia. It is intended that this report will be included in a Prospectus to be lodged with the Australian Securities and Investment Commission (ASIC).

GMS has not been requested to provide an Independent Valuation of the Mineral Assets, nor has it been asked to comment on fairness or reasonableness of any vendor or promoter considerations, and it has therefore not offered any opinions on these matters.

GMS has based its review of the Peel Exploration projects on information provided by Peel Exploration along with technical reports prepared by Government agencies and previous tenement holders, as well as other relevant published and unpublished data. No site visits to any of the properties were undertaken.

GMS has made all reasonable enquiries to establish the authenticity and completeness of the technical data on which this report is based.

Peel Exploration was given a final draft of this report, and was thereby given an opportunity to identify any material errors or omissions. Where appropriate, and in accordance with ASIC Practice 55 and Update 183, consent has been obtained to quote data and opinions expressed in unpublished reports prepared by other professionals on the properties concerned.

Peel Exploration has been granted four Exploration Licences (EL's) in the New England area covering 700 km².

The legal status associated with the tenure of the Peel Exploration properties has not been verified by GMS, and is discussed in the Solicitor's Report in the Prospectus.

This report has been prepared in accordance with the Code and Guidelines for the Assessment and Valuation of Mineral Assets and Mineral Securities for Independent Expert Reports (the 'Valmin Code') which is binding upon members of the Australasian Institute of Mining and Metallurgy (AuslMM) and members of the Australian Institute of Geoscientists (AIG), as well as the rules and guidelines pertaining to Independent Expert Reports issued by ASX Limited (ASX).

The Peel Exploration properties are considered to be 'Exploration Prospects', which are inherently speculative in nature. However, GMS is of the opinion that the projects have been acquired on the basis of sound technical merit. The properties are also considered to be sufficiently prospective to warrant further exploration and assessment of their economic potential, consistent with the exploration budgets proposed.

This independent Geologist's Report has been prepared on the basis of information available up to and including February, 2007. GMS has provided consent for the inclusion of the report in the Prospectus, in the form and context in which the report and these statements appear.

Yours faithfully.

I blyden

Dr. Ian Douglas Blayden PhD, MBA, BSc, MAusIMM MMICA CP (Geo) Managing Director

Geological and Management Services Pty Ltd ABN 47 001 256 248 Unit 7, Level 3 Charles Plaza 66 King St Sydney NSW 2000 Ph: (02) 9299 5591 Mob: 0417 461 262

PEEL EXPLORATION LIMITED MINERAL ASSETS INDEPENDENT EXPERTS REPORT

Introduction

Geological and Management Resources Pty Ltd (GMS) was requested by Peel Exploration Limited to carry out an independent review of the EL's (Exploration Licence) held by Peel Exploration in the New England area of New South Wales (Figure 1). The assessment was carried out using published and unpublished information available from the records of the NSW Department of Primary Industries (DPI), primarily in the form of mining records and previous exploration reports. No fieldwork was carried out as part of the assessment.

Figure 1 - Tenement locations

Geological Setting

The EL's are all located on the New South Wales portion of the New England Fold Belt (NEFB) (Figure 1). The NEFB covers much of northeastern NSW and southeast Queensland with the NSW portion comprising two principal subdivisions, the Central Block to the east and Tamworth Belt to the west separated by the regionally significant Peel Fault.

Central Block

Some of the oldest rocks in the block are serpentinites of Middle Cambrian to Early Silurian age distributed along the Peel Fault and associated structures as a series of discrete elongate slivers. The rocks are believed to represent fragments of oceanic crust caught up during a later subduction phase beneath the Peel Fault.

The Pipeclay Creek Formation and associated sequences which also occur as slivers along the Peel Fault south of Tamworth are of Cambro-Ordovician age. The unit comprises cherty siltstone, sandstone, conglomerate and oolitic limestone which are believed to have been deposited in moderate to shallow water depths in a marine environment.

A north westerly trending, fault bounded slice of Cambro-Ordovician strata crop out to the east of the Peel Fault and are referred to as the Woolomin "Association". The Association includes rocks of the Woolomin Group and comparable units. Comprising volcaniclastic lithic sandstone, siltstone and mudstone with subordinate chert, jasper, basalt and diamictite, these rocks are believed to have been deposited in a deep water marine environment.

Sandon "Association" rocks of Devonian to Early Carboniferous age occur over much of the central portion of the Block. This sequence includes the Sandon Beds, Wisemans Arm Formation and Whitlow Formation (conformably overlies the Cara Formation). The Sandon Association strata are also of deep water origin and are lithologically similar to the Woolomin Association rocks. The sequence comprises lithic clastics, slate, chert, jasper and metabasalt.

The Girrakool Beds of late Carboniferous occur to the east of Armidale forming part of the Coffs Harbour "Association". This sequence is dominated by slate and sandstone.

All of these rocks are tightly folded, cleaved and regionally metamorphosed grading from prehnite-pumpellyite to medium greenschist facies. The Woolomin Group rocks generally exhibit the highest metamorphic grades.

The Manning Formation is a sequence of Early Permian sediments with some volcanics occurring as fault slices within the Woolomin Group rocks adiacent to the Peel Fault. The sequence is of marine origin. Other sediments of Early Permian age, but which are little deformed, occur as inliers near Armidale and are of lacustrine origin. Similarly, pyroclastic rocks and acid volcanics of Early Permian age are also developed in the area of Armidale.

Two principal intrusive events are recognised in the Central Block, the Bundarra Plutonic Suite of Early Permian age and the Uralla-Moonbi Suite of Late Permian to Triassic age. Occurring largely as an aggregation of plutons in the central axial region of the Central Block, the Bundarra Suite comprises coarse grained porphyritic to equigranular biotitemuscovite-cordierite granite. These granites are classified as S-type granites as their intrusion was synchronous with a widespread episode of folding and thrusting.

Plutons of the I-type (post tectonic) Moonbi and Uralla Plutonic suites are characteristically massive with equigranular and porphyritic variants and include biotite leucogranite and biotite-hornblende granites as well as monzonite, tonalite, diorite and gabbro. Dyke swarms of lithologically similar rocks are often associated with the intrusions as are strong contact metamorphic aureoles in the intruded country rock.

Tamworth Trough

Comprising a belt of regressive marine to terrestrial clastic rocks of early Late Devonian to Early Permian age and Early Permian basalts, the Tamworth Trough defines the western margin of the NEFB. The north north-westerly trending Hunter-Mooki Thrust Fault forms the western boundary of the Trough with the Peel Fault forming the eastern boundary. The strata within the Trough are deformed by a series of elongate folds and subsidiary thrusts. In the southern portion of the Trough the rocks are further deformed by a later complex pattern of cross faults and associated folding.

Moonbi Suite plutons infrude the sequence north of Tamworth and a separate group of plutons of Middle Permian age, referred to as the Nundle suite, intrudes sediments further to the south. The Nundle Suite plutons are low potassium hornblende biotite granodiorites and trondihemites characterised by a massive texture and a well developed contact aureole. The Barrington Tops Granodiorite, Duncans Creek Trondihemite and Barry Igneous Complex are part of this suite. A cluster of mafic to ultramafic stocks and dykes of Jurassic age occurs in the northern part of the trough.

A widely developed series of basaltic volcanic centres developed over the NEFB during the Tertiary with the evolution of calderas, plugs and extensive flows.

Mineralisation

The NEFB is characterised by the occurrence of a large number of mineral deposits wide ranging in distribution and type. Deposits include stratiform polymetallic and gold occurrences, granite hosted tin and molybdenite deposits as well as vein hosted gold, silver, polymetallic and stibnite deposits. Deep lead and/or alluvial gold, sapphire, diamonds and tin deposits are also widespread.

To date, most of the mining has been in the form of small scale and relatively short-lived operations, leading to the idea that no significant deposits occur within the area. However the region has yet to be subject to the persistent and widespread application of recent exploration concepts and techniques that have been applied to the Lachlan Fold Belt and Broken Hill areas and therefore cannot be said to be well explored.

EL 6613

Licence Details

Issued to Peel Exploration Ltd on 22 August 2006 for a period of 2 years, the EL comprises 84 units covering an area of 252 km².

Location and Access

EL 6613 is a northerly elongate block extending over a strike length of 35 km. The northern most part of the EL is located 4 km south east of Moonbi on the New England Highway and 10 km east of Tamworth. The terrain is undulating and has been largely cleared of native vegetation and used for grazing. Access is readily obtained by means of several municipal roads and farm service roads. The surface rights are primarily freehold.

Geology

For the most part, EL 6613 is situated within the NEFB 3 to 5 km east of the north westerly trending Peel Fault zone and overlies steeply dipping rocks of Late Silurian to Carboniferous age. To the south the Peel Fault passes just to the west of the permit boundary. A major subsidiary fault sub-parallel to the Peel Fault, herein referred to as the Dungowan Fault, bisects the area separating a block of Woolomin "Association" rocks to the west from Sandon Beds to the east. Projecting into the southern portion of the area is the Duncans Creek Trondjhemite, an intrusion of the Nundle Plutonic Suite.

Figure 2 - EL 6613 Location, Geology and Mineral Deposits

Mineral Deposits

There are two principal deposit types within the permit, both primarily of syngenetic origin. To the west of the Dungowan Fault, contained within the volcaniclastics, basalts and jaspilites of the Woolomin Group, are a series of polymetallic VHMS style deposits. Stratiform manganese rich rocks are host to auriferous veins on the eastern side of the Dungowan Fault in the Limbri area at the northern end of the permit.

Polymetallic Deposits

A number of cupriferous pyrite deposits hosted by the Woolomin Group extend from near Dungowan within the EL to near Bingara north of Tamworth. A major concentration of these deposits occurs around Dungowan where some nine separate prospects are recognised by the DPI.

Where field relationships can be established the mineralisation is conformable, lenticular, commonly massive and associated with jasper and heavily altered basaltic volcanics. The deposits vary greatly in size from small areas of copper carbonate staining up to deposits such as Trough Gully and Fishers from which 2572 t and 2643 t of ore were produced. Occurring as single lenses or groups of lenses, individual deposits extend up to 60 m along strike, 4 m wide and 40 m down dip. Ore grades were generally between 2% and 4.5% copper with some ore from Fishers averaging more than 15% copper.

The ores are characteristically massive, though sometimes mineralogically banded, comprising, in decreasing abundance, pyrite, chalcopyrite, bornite, sphalerite and magnetite with small amounts of gold as well as bismuth, lead and manganese minerals.

The stratigraphic associations, textures and mineralogy clearly indicate that these deposits are of submarine exhalative origin (VHMS type deposits)

Sediment Hosted Gold

A number of small gold deposits occur in the vicinity of Limbri in the northern end of EL 6613. Little detailed work has been carried out on individual deposits but the mineralisation is known to occur in a sequence of chert, jasper, siltstone, sandstone and metabasalt rocks of the Sandon Beds. Stratiform manganese oxides occurrences also occur in the vicinity.

Gold mineralisation occurs in individual quartz veins or vein stockworks in brecciated chert in association with significant pyrite mineralisation. Managnese oxide is commonly associated with the veins as gossanous outcrops.

As with the copper deposits, the stratiform manganese and chert horizons are believed to have formed as the result of submarine volcanic exhalations. The aold mineralisation is believed to result from hydrothermal activity related to regional deformation and the intrusion of nearby Moonbi Adamellite. The gold has probably been remobilised from the exhalative sediments as indicated by the occurrence of manganese in the veins.

There has been very little detailed surface mapping of the Limbri deposits in particular and of the area in aeneral so that the area is little understood. As the chert horizons are believed to be extensively developed there is considerable scope for further exploration of these deposits.

Previous Exploration

Regional Exploration

Over the period 1969 to 1971, exploration in respect of EL 191 which covered an area 1385 km² between Bendemeer and Nundle included the collection 3312 stream sediment samples which were analysed for a range of elements including copper and manganese. A copper anomaly was identified in the vicinity of the Trough Gully Mine but it was subsequently established to result from sample contamination derived from the mine spoil heap.

In 1974, regional stream sediment sampling of EL 563 covering the Kootingal-Nundle area was conducted and some detailed mapping of the Trough Gully Mine was also carried out. No details are given on the sampling and analysis procedure so it is difficult to comment on the effectiveness of the programme. The most significant anomalies were of copper in an area 4 km east of Kootingal with values of between 200 and 300 ppm commonly obtained with some values up to 400 ppm. Follow-up work did not lead to any recognisable mineralisation and it was concluded the anomalous areas were related to enhanced copper levels in the underlying basaltic rocks.

Until November 1982. EL 1875 covered 256 km² over an area including the Trough Gully. Fishers and Mulla Creek copper mines. A programme of regional mapping was proposed to identify further occurrences of copper mineralisation. The area was found to contain little useful outcrop apart from chert and jasper and the programme was curtailed.

Figure 3 - EL 6613 Total Magnetic Intensity

Prospect Definition

Fishers - Reported to have produced 2643 t at an average grade of 13.4% Cu, the Fishers Mine operated over the periods 1899-1900 and 1968-1974. Up to six separate lodes were reported with the largest, (Cathedral Lode) being 23 m long and up to 3 m wide. The NSW Geological Survey carried out an investigation of the mine between 1968 -1970 including IP, magnetometer and stream sediment geochemical surveys. Over the period 1971-72 the mine operators carried out a programme of costeaning, an EM survey, a magnetometer survey and a programme of percussion drilling.

The drilling comprised 11 holes totalling 382 m with the deepest at 56 m. Documentation of the drilling was very poor but is was reported that the intersections did not support continuation down dip and along strike of the Fishers orebody. The best intersection from the drilling was a zone averaging 5.45% Cu over an interval about 1.5 m in PDH6. The significance of this intersection has not been fully evaluated.

Trough Gully - Production from this mine totalled 2752 t of ore with 1315 t smelted for copper and 787 t used in the production of sulphuric acid. This production took place periodically over the period 1899 to 1916. Workings reportedly extended up to 40 m along strike, up to 4 m in width and up to 12 m deep. Further mineralisation occurs 150 m to the north.

A local syndicate undertook underground inspections, costeaning and some small scale open pitting by buildozer over the period 1961 to 1969. An IP survey and ground magnetometer survey were undertaken by the NSW Geological Survey in 1962 and 1966. The Survey also sampled the workings in 1962 with the eight samples returning an average grade of 2.2% copper, 1.2% zinc, 13 ppm silver and a trace of gold.

Mulla Creek - There are limited records of this mining operation. It was worked between 1911 and 1913 when 12 t of copper ore were produced though the grade is unknown. Sporadic working then took place over the period 1969-1980. The NSW Geological Survey undertook a number of investigations between 1969 and 1980.

The copper mineralisation is believed to extend over a strike length of 150 m with a thickness of up to 9 m but details of the actual lode are sketchy. Analysis of eight rock chip samples returned individual grades of up to 1.9% copper, 2.8% zinc, 21 ppm of silver and 0.9 ppm of gold.

• $(1)$ Woolomin - Worked between 1910 and 1912, this prospect comprises two shafts and a 104 m long adit. There are no records of production or grade. No recent systematic exploration of the prospect has been undertaken.
• $(ii)$ Mt Pleasant - A 15m shaft was sunk on this prospect in 1885 to follow a narrow gossanous vein. Subsequent exploration included the driving of adit over 30 m. Parts of the prospect was examined in 1971 by means of surface mapping, and soil geochemistry. Copper carbonate mineralisation was identified in a number of localities believed to be associated with jasperlitic horizons. Soil geochemistry, over a 200 m X 600 m area identified a number of copper anomalies but these were traced to known occurrences in the jaspilite. The tenement holder believed any likely discovery would not meet company requirements and no further work was carried out.

Other Prospects --Several other copper prospects are known to occur in the area as well as a number of manganese occurrences, generally of limited surface expression, and have yet to receive any systematic exploration.

Limbri Area - NSW Geological Survey records identify nine shallow gold diggings in the form of shafts and trenches near Limbri in the northern part of the permit. No records exist on production levels or when most of the activity occurred although one prospect, Thompsons, is believed to have been active in 1940. Presumably the other diggings were also active around the same time.

The gold mineralisation occurs as veins and/or stockworks in jasper. A programme of investigation of the prospects was undertaken in 1998 - 1999 within EL 5392 with the aim of identifying further stockwork hosted gold mineralisation within the laterally extensive jasper horizons. It was proposed that the gold might have been remobilised from associated manganese rich horizons believed to be of submarine exhalative origin. A programme of field mapping, rock chip sampling and stream sediment sampling was carried out to investigate both hypotheses.

Detailed mapping and sampling of five diggings was undertaken with gold grades of up to 28 g/t being obtained from the samples. Lack of outcrop between workings precluded any estimate of the extent of the mineralisation. Ten stream sediment samples were collected but all samples returned values of <1 ppb aold.

Exploration Potential

Two styles of mineralisation are apparent in EL 6613. A copper dominant VHMS style in the south and vein/stockwork hosted gold in the north.

Previous mining and exploration records clearly show that the strata in the central and southern portions of the permit host a number of massive sulphide mineral deposits. The mineralogy and stratigraphic associations clearly indicate them to have originated through submarine volcanic activity. Deposits of this type may vary in size from <1 Mt to over 100 Mt and represent an extremely worthwhile exploration target.

A review of the data would suggest that the deposits are far from adequately explored either in terms of detail mapping, by geophysical means or by drilling. Drilling has been carried out at only at one prospect (Fishers) and potentially economic mineralisation in one hole (PDH 6) was not followed up. The likely source of the mineralisation, and therefore the location of potentially larger orebodies, is down dip to the east and a programme of detailed, geophysics and drilling is warranted to evaluate the potential for economic mineralisation down dip of the known deposits.

The most recent evaluation of the vein hosted gold deposits was in 1998-99 prior to the release of regional magnetic data acquired by the DPI. These data (Figure 3) over the Limbri area clearly show concentric structures, possibly related to the intrusion of the Moonbi Adamellite, not known to previous explorers. The gold at Limbri is hosted in jasper horizons which are extensively developed in the area and further investigation of these horizons is warranted in the light of the new information.

EL 6614

Licence Details

The permit EL 6614 which comprises 16 units and covers an area of 48 km² was issued to Peel Exploration Ltd on 22 August 2006 for a period of 2 years.

Location and Access

EL 6614, also known as the Barry Project, is located 25 km SW of Nundle and 65 km SW of Tamworth in the southern New England area. Access into the area is by means of several municipal roads, farm service roads and bush tracks. The topography is steep and most of the native vegetation has been cleared for grazing.

Geology

Covering part of the Peel Fault system in the south western part of the Central Block, the area comprises a series of elongate, narrow (1 km or less in width), north westerly trending fault blocks containing slices of Woolomin Group sediments and volcanics along with marine sediments of the Permian Manning Group. Blocks of serpentinite along with basic to ultrabasic igneous rocks also occur. The Barry Igneous Complex, a trondihemite plutonic body forming part of the Nundle Plutonic Suite, also occurs in one fault block intruding rocks of the Woolomin Group as well as serpentinite associated mafic igneous rocks. Basalt flows of Tertiary age cap many of the higher ridges.

Figure 4 - EL 6614 Location, Geology and Mineral Deposits

Mineral Deposits

A number of small copper and/or copper molybdenite prospects occur in the area but only two of these, the Barnard River Prospect and the Black Barb prospect have been examined in any detail.

Barnard River, Barnard Hut - Located 2 km east of Barry Homestead, copper mineralisation has been traced by costeaning in a north easterly direction centred around the Barnard River for a distance of three km. A total of five individual occurrences are reported in association with or within close proximity to serpentinite.

At the river the copper mineralisation occurs as chalcopyrite with some malachite and bornite in quartz veins within an altered dolerite dyke. Approximately 650 m to the south east and 100m above the river copper bearing carbonate rocks were exposed. Many samples were obtained during prospecting with grades up to 8% copper.

Back Creek - Two kilometres north of the Barnard River prospect molvbdenite mineralisation has been reported in a 0.6m quartz vein traceable over a distance of 20 m. The host rock is not known.

Black Barb Prospect – Prospected by means of a 74 m adit and bulldozed costeans, the Black Barb Prospect comprises copper mineralisation in shear and fracture controlled veins and lenses. The shear zones and veins are developed in steeply dipping basic volcanics of the Woolomin Group and in strongly altered acid intrusives of the Barry Intrusive Complex.

Mineralisation comprises calcite, chalcopyrite and pyrite along with malachite, minor azurite and rare bornite. Samples contained <0.5% copper. Another deposit between Black Barb and Barry is reported to contain copper and molybdenite.

Barry Southern - Copper mineralisation is reported from a costean near Barry Homestead but there are no details on the style or grade.

Figure 5 - EL 6614 Total Magnetic Intensity

Previous Exploration

Regional Exploration

A regional stream sediment survey, photogeological interpretation and airborne magnetic survey were carried out over the general area in 1967-68 as part of a base metal prospecting programme, including nickel. Unfortunately much of the basic data

obtained from this work has been lost although it was reported that elevated chromium, nickel and copper values were obtained around Barry.

A programme of regional exploration and prospect evaluation in the Nundle-Barry great was carried out over the period 1970-71 (EL 654). This programme included geochemical sampling with a reported 376 samples being collected. Many samples contained arades of over 1% copper but unfortunately the location of the samples has been lost.

Between 1987 and 1989 little new work appears to have been done apart from the collection of 3 stream sediment samples and 3 rock chip samples in the vicinity of the Barnard River Prospect. One sample of mullock returned a grade of 1.5% copper.

No new exploration was carried out when the Barry area was part of EL 4940 held Warren Jav Holdinas Ptv Ltd in 1997.

Prospect Definition

Recognition of the minerallsation in the Barry area appears to have been relatively recent with the first records being in reports of the work carried out in 1970. In addition to geochemical sampling in the Barnard River area a programme of costeaning was undertaken to define the Barnard River, Barnard Hut and Back Creek Prospects. This work identified minerallsation over a strike length of around 3 km. The Barry Prospect also appears to have been investigated at this time. Unfortunately most records of this work have been lost and the reason for cessation cannot be ascertained.

Surface and adit work at Black Barb was also carried out at this time by a private prospector and as far as is known this work was also abandoned without any significant production having occurred.

Exploration Potential

The nature of the mineralisation in the Barry area is not well known but may in part be similar in style to the VHMS mineralisation in EL 6613. Prospecting work identified mineralisation over a strike length of 3 km. Unfortunately much of the data relating to this exploration has been lost and it is difficult to assess the significance of the work. However, aiven that the mineralisation style is likely to be similar to EL 6613 and that there is an extensive strike length of mineral occurrences there is the potential for the discovery of economic base metal deposits. Further exploration by means of mapping, soil geochemistry, geophysics and drilling is definitely warranted.

EL 6719

Licence Details

Issued to Peel Exploration Ltd on 26 February 2007 for a period of 2 years, the EL comprises 33 sub-blocks and covers an area of 100 km².

Location and Access

This prospect is located on the north eastern margin of the Hunter Valley 10 km east of the New England Highway. Murrurundi is 15 km to the west and Scone is 40 km to the south west. Access is by means of municipal roads, farm service roads and tracks. The topography is steep to rugged and although there is some remnant native vegetation most of the area has been cleared for grazing.

Figure 6 - EL 6719 Location, Geology and Mineral Deposits

Geology

Located in the southern portion of the Tamworth Trough the permit covers the axial portion of the Timor anticline. This is a broad north westerly trending structure affecting sediments of the Devonian Tamworth Group and overlying the Parry Group of Late Devonian-Early Carboniferous age.

The lowermost unit of the Tamworth Group is the Yarramie formation consisting of finegrained cherty sediments, mudstone, greywacke and limestone believed to be of shallow marine origin. The upper part of the Tamworth group and overlying Parry Group comprises a sequence of shallow shelf marine arenites and mudstones inter-finaered with terrestrial conglomerate and sandstone deposits.

A blanket of Tertiary basalt obscures the older rocks over much of the area to the east.

In the northern part of the permit the strata maintain a regional north westerly strike but there is a marked structural change in the south where the strata dip more steeply and the strike swings sharply to the north east. This change is accompanied by the development of a complex pattern of shear faults which also strike in a north easterly direction.

Figure 7 - EL 6719 Total Magnetic Intensity

Mineralisation

The only known mineralisation in the area is the Waverly Silver Lead Prospect which occurs as a series of discontinuous pods, stringers and veins within a northerly trending, steeply dipping shear zone. Mineralisation has been prospected intermittently over a strike length of 3 km hosted in south westerly dipping mudstone of the Parry Group.

Mineralisation along the zone consists primarily of quartz pods up to 3 m wide but generally <0.5 m with individual lenses <3 m in length though one was traced for a little over 20 m. Most lodes contain amounts of galena with quartz although locally baryte, pyrite, chalcopyrite and sphalerite also occur along with gold and silver.

Assays of up to 310 g/t of silver and 16% lead were obtained from active workings in 1906 although more recent sampling of the abandoned workings (1968) returned grades of < 65 a/t of silver and 0.6% lead. Sampling in 1995 returned results of up to 9.43% lead and 14.06% zinc and 739 g/t silver.

Previous Exploration

Since the discovery in 1868 there has been three principal phases of mining. The first over the period 1868 to 1873, the second in 1884 and a third phase of sporadic operations over the period 1905 to 1912. No plans of the old workings exist although it has been reported that one mine operated on two levels that were two levels 49 m apart.

The NSW Geological Survey undertook a review of the deposit in 1967 when the surface expression of the workings was mapped, the geological setting established and some samples collected for analysis.

A programme of rock chip sampling and stream sediment geochemistry was undertaken by the tenement holder between 1995 and 1996. A total of 418 geochemical samples were collected and analysed for base metals, gold silver, arsenic and bismuth. Eighteen rock chip samples were analysed as shown in the accompanying table.

	Analytical Data - Rock Sampling
No	Au (F) (ppm)	Au(R) (ppm) Repeat	As (ppm	Cu (ppm)	PЬ (ppm)	Ζn (ppm)	Ag (ppm)	Bi (ppm)	\$b (ppm)	Hg (ppm)	Ca (ppm)	Gа (ppm)	in (ppm)	Ge (ppm)
3	0.02	0.04	120	1180	4070	870	258	$\leq$	186
$\overline{2}$	$\sqrt{0.01}$		$\overline{Q}$	550	3680	7850	$\overline{78}$	< ₹	158
3	$\overline{60}$		57	169	385	318	$\overline{14}$	$\overline{\mathbf{a}}$	$\overline{56}$
4	< 0.01		49	253	2280	2310	$\overline{22}$	$\mathbf{I}$	$\overline{44}$
5	$-0.01$		$\overline{16}$	156	1780	172	$\overline{14}$	$\mathbf{I}$	40
6	0.03	0.05	64	163	2680	6	419	$<$ ?	930
7	$-0.01$	$-0.01$	80	$\overline{18}$	$\overline{17}$	63	$\overline{4}$	$\mathbf{1}$	$\overline{14}$
$\theta$	$\overline{60}$		$\overline{\mathbf{1}}$	$\overline{12}$	$\overline{3}$	$\overline{2}$	$\overline{5}$	$\mathbf{I}$	$\overline{10}$
9	<0.01	$-0.01$	$\overline{8}$	63	1350	680	$\overline{53}$	$\mathbf{1}$	$\overline{53}$
ĩΘ	0.03	0.03	$\overline{39}$	850	8320	6840	210	$\mathbf{I}$	504
$\overline{\mathcal{N}}$	0.0	0.03	13	850	1.42%	7080	259	$\mathbf{I}$	581	36.4	186	1,0	< 0.05	8.6
$\overline{12}$	< 0.01	$-0.01$	$\overline{8}$	118	1070	840	$\overline{17}$	$\mathbf{1}$	56
$\overline{3}$	0.03	0.04	33	900	1.29%	1.25%	389	$\mathbf{I}$	602	579	384	1.7	$\overline{6.05}$	6.5
$\overline{\mathbb{1}}$	0.25	0.24	240	6150	9.43%	14.60%	739	$\mathbf{I}$	3150	4183	4160	$\overline{1.3}$	0.34	3.7
$\overline{5}$	$-0.01$	$-0.01$	$\overline{12}$	39	1400	288	$\overline{Q}$	$\mathbf{1}$	$\overline{24}$
16	< 0.01		$\leq$	13	103	94	$\leq$	$\mathbf{I}$	5
$\overline{37}$	$-0.01$	$-0.01$	$\overline{29}$	30	188	237	3	$\mathbf{I}$	$\overline{15}$
38	$\overline{60}$	0.02	$\overline{23}$	228	4360	1480	34	$\mathbf{I}$	135

Table 1. Waverly Rock Sample Analyses

Exploration Potential

The Waverly Silver Deposit is unusual in that it is an isolated occurrence of a vein hosted silver deposit in which there is neither an obvious source for the mineralisation nor any means by which it was mobilised. One difficulty in resolving these issues has been that much of the basement aeoloay in EL 6719 is obscured by Tertiary volcanics. However recent aeromagnetic data acquired from the DPI has provided a means of "seeing" through the basalt to the underlying structure. This shows that a substantial circular magnetic low up to 2 km in diameter is developed to the east of Waverly which probably defines the occurrence of a small pluton.

The thermal effects of the intrusion of such a body would be sufficient to drive the mobilisation and deposition of the Waverly deposit although the source of the mineralisation is still problematic. It may be that there is previously unsuspected silverlead-zinc VMS style mineralisation in the Tamworth or Parry Group rocks which has been remobilised. Further exploration of the area is warranted on the basis of the revised aeological interpretation.

Exploration targets in the Parry area would be of two types:

• Extensions to or further occurrences of Waverly type mineralisation around the $\bullet$ pluton which are currently obscured by the basaltic cover.
• Stratigraphically controlled silver-lead-zinc mineralisation.

EL 6722

Licence Details

Issued to Peel Exploration Ltd on 26 February 2007 for a period of 2 years, the EL comprises 100 sub-blocks and covers an area of 300 km².

Location and Access

Located 20 km NE of Armidale the permit area is situated over a gently undulating topography f the New England Plateau. The New England Highway passes through the western part of the area and it is traversed by a number of municipal roads and farm service roads. There is some remnant bushland but most of the area has been cleared for grazing.

Geology

Situated in the centre of the Central Block, EL 6722 has perhaps the most varied geology of all the areas held by Peel Exploration Ltd. The Sandon Beds of probable Late Devonian to Early Carboniferous are the oldest rocks in the area comprising mainly sandstones with chert, jasper and metabasalt. The sandstones consist primarily of intermediate and felsic volcanic detritus. The rocks have been strongly folded, faulted and regionally metamorphosed from prehnite-pumpellyite to lower greenschist facies.

The Dummy Creek Conglomerate of Early Permian age occurs as an inlier in the northwestern part of the area. Occurring in a north easterly trending synclinal structure the rocks rest unconformably on the Sandon Beds and comprise polymictic orthoconalomerate, sandstone and carbonaceous siltstone. The Annalee Pyroclastics, also of Permian age, occur as a separate inlier in the north west. The unit comprises felsic volcanics, minor tuffaceous sandstone and sub-volcanic intrusives.

A number of granite plutons forming part of the Uralla Plutonic Suite of Permian age occur in the area. Plutons of this suite are typically massive and equigranular with boundaries discordant with the structural trends of the country rock. The principal plutons are the Mt Duval Adamellite, a porphyritic hornblende biotite monzogranite, the Tilbuster

Granodiorite, an augite-bronzite-hornblende biotite granodiorite and the Highlands Complex, principally a hypersthene-augite-amphibole-biotite monzonite.

Locally some areas of the basement geology are covered by a blanket of Tertlary basalt.

Figure 8 - EL 6722 Location, Geology and Mineral Deposits

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Mineral Deposits

The Greengate No1 silver deposit in the north western part of the licence is the only stratabound deposit in the permit area. Most other deposits comprise vein hosted silver, gold, and/or base metals and antimony occurrences. Most of the deposits occur in two separate clusters referred to as the Tilbuster and Puddledock deposits. There are also several isolated mineral deposits in the area including the Greengate Silver Mine, Talts Gully Mine. Hlahlands antimony deposit and Clifton silver-aold deposit.

Greenaate No 1 - the deposit is a conformable pyrrhotite-pyrite chalcopyrite orebody in the core of an anticline in the Sandon Beds. The host rocks comprise steeply dipping (74° W) thinly bedded chert and argillite up to 15 m thick. The sulphides are confined to the argillite layers with the main mineralisation up to 0.3 m thick and extending over a strike length of 120 m. Although there is evidence of some remobilisation the deposit is considered to be of volcanic exhalative oriain.

Greenaate Silver Mine - located 600 m north of the Greenaate No 1 mine, the Greengate Silver Mine occurs in a northerly trending silicified shear zone in arenaceous clastic rocks of the Sandon Beds. Extending over a strike length of 150 m two separate lodes are recognised which are respectively 0.7 m and 1.5 m thick. Grades are variable and are up to 36 g/t silver, 2.3% lead and 4.5% zinc. Pyrrhotite mineralisation was encountered in a borehole at the southern end of the prospect. Mineralisation is most likely genetically related to the Mt Duval Adamellite, which crops out 1.5 km to the south.

Tilbuster Deposits - a group of about ten separate prospects are located near the village of Tilbuster, 10 km north of Armidale. The most significant of these are the Great Britain, Zulu and Eureka at Tilbuster along with the Little Nell and Mary Anderson to the south. All these prospects are developed in the Mt Duval Adamellite. The deposits consist of near vertical veins of quartz, calcite and dolomite in brecciated altered granite. Ore minerals include stibnite and arsenopyrite with pyrite and gold. There is little data on the width, lateral extent and depth of individual deposits.

Puddledock Deposits - a cluster of about ten individual prospects occur 16 km to 20 km north northeast of Armidale comprising quartz stibnite-gold veins hosted in mildly hornfelsed mudstone and sandstone of the Sandon Beds. Alluvial deposits also occur in the area. The most important occurrence is the Whybatong Mine (not held by Peel Exploration) consisting of gold-antimony-silver minerals in quartz. Base metal sulphides reputedly occur at depth. The vein is up to 0.3 wide and 200 m in length.

Taits Gully - located in the Puddledock area, this prospect is considered to be genetically unrelated to the other deposits. Silver, gold and base metal minerals occur over 800 m in an easterly trending shear zone in contact-metamorphosed Sandon Beds comprising dolomitic tuffs, tuffaceous siltstones and calc-silicate rocks. The mineralised shear zone is 1.5 m or greater in width and the principal minerals are arsenopyrite, sphalerite and pyrite. Production pre 1904 averaged 1.22 kg/t silver. The style of mineralisation indicates a possible association with the Highlands Complex 1 km to the north rather than with the Tilbuster Granodiorite.

güyra ARMIDALE

Figure 9 - EL 6722 Total Magnetic Intensity

Previous Exploration

Regional Exploration

Nickel Mines Ltd held MEL616 over the Armidale-Walcha area in 1971 and including the Puddledock area. There are no records of any significant work by this company.

EL1804 was granted in 1992 covering the Greengate-Puddledock-Tibuster area for the purpose of prospecting for microfracture or breccia style bulk tonnage tin/base metal/silver deposits. Pre-existing aeromagnetic data was compiled, a regional structural interpretation was undertaken and a regional mapping and rock chip sampling programme was carried out. No targets of sufficient interest were identified.

A strong magnetic anomaly was identified which was associated with the Taits Gully prospect in 1984. It was believed the anomaly may indicate the occurrence a pyrrhotite rich sulphide body. The tenement holder carried out a detailed mapping programme, ground magnetics and drilled percussion holes. The drilling identified the anomaly as a magnetite rich alteration halo in Dummy Creek Conglomerate resulting from the intrusion of an east-west striking porphyry dyke. No significant mineralisation was identified and the area was relinquished.

In 1996, EL 4822 was granted covering 8795 km² for the purpose of diamond exploration. The area extended between Inverell and Tamworth to the west of the New England Highway. Work included an aeromagnetic survey of the northern part of the area, photogeology, ground investigation of photo features and aeromagnetic anomalies some ground magnetics along with the collection 73 gravel samples and 30 rock chip samples.

Prospect	Period of Activity	Mineralisation	Production
Greengate No1	19?	Copper	ND
Greengate Silver Mine	1890-1898 1966	Silver, Lead, Zinc	ND.
Taits Gully	1905 – 1907 1909 - 1911	Silver and some Gold	2,376 kg silver
Clifton	1924	Silver, Lead, Zinc	ND
Tilbuster Deposits
Great Britain	1899, 1900, 1904, 1934	Gold, Antimony	Little data, 5.22 kg gold from tailings in 1934
Zulu	1895	Gold	ND
Eureka	1938.?	Gold	ND.
Little Nell	1896 - 1897	Gold, Silver	ND.
Mary Anderson	1900	Gold, Antimony	ND.
Mt Duval Gossan	1982	Tin, Silver, Lead	No production
Puddledock Deposits
Whybatong (not held by Peel Exploration)	1897, 1936 - 1939	Gold, Silver, Antimony	24.8 kg Au

Table 2. Summary of Prospects in EL 6722

Prospect Definition

Table 2 summarises the prospecting and mining activities for the known prospects in EL 6722. It will be seen that most prosecting and mining activity occurred around the end of the 19th Century and early 20th Century as well as before the 2nd World War. Systematic exploration has been undertaken on a few of the prospects since active mining ceased.

Greengate Silver Mine - A mapping and sampling programme was carried out at the Greengate mine by the NSW Geological Survey in 1967. The Survey also logged core from an inclined diamond drill hole put down to 29.4 m by the leaseholder 400 m south of the main workings. Six chip samples and five grab samples were analysed returning a maximum grade of 33 g/t of silver and 2.3% lead (66/1711) whilst another sample (66/1710) in the same locality returned a grade of 4.5% zinc. The drill hole contained several intersections of pyrrhotite but no significant precious or base metal mineralisation.

Taits Gully - An evaluation of Taits Gully was carried out by means of surface mapping and analysis of 11 dump samples. The best grades obtained were 222 g/t silver and 4.9 g/t gold from the Mary Anne Dump and 39 g/t silver with 0.64 g/t gold from the Endeavour dump.

A sampling programme was carried out in 1984 and subsequently four inclined cored holes were drilled with a maximum depth of 134 m. Three percussion holes were subsequently drilled about 200 m west of the Endeavour shaft. Prior to the second phase of drilling further sampling and mapping was undertaken along with soil geochemistry and an IP survey.

The surface work identified that the host rocks consisted of fine grained tuffaceous siltstone and vitric tuff. The mineralisation is developed in a shear zone characterised by argillic alteration and silicification. Disseminated pyrite becomes more abundant on approaching the zone and mineralisation in the zone includes sphalerite, arsenopyrite with minor pyrrhotite, aalena and chalcopyrite.

Mapping and geophysics identified a narrow east-west zone to the west of the workings which was shown by drilling to contain disseminated sulphides consisting mainly of pyrite and pyrrhotite. Other drilling included one hole at the Endeavour workings and three at the Mary Anne Workings. A single significant intercept of 7 m at 48 g/t silver, 0.2 g/t gold, 0.6% zinc and 0.3% lead from 54 m was returned from TGDDH03. This hole is believed to have tested only the footwall of the Mary Anne workings.

Interpretation of the geology as identified in the drilling was problematic and the tenement holder concluded the other holes drilled at the Mary Anne (TGDDH01 and TGDDH04) may have penetrated below rather than through the lode as result of misunderstanding of the geology. Hence the lack of significant mineralisation in these holes. A "low grade lode zone" known to occur in the old workings may therefore remain untested.

Figure 10 - EL 6722 Bouquer Gravity

Exploration Potential

The Armidale area contains many small mineral deposits, many of which have not been subject to recent exploration. Given that the area has been subject to a regional aeromagnetic survey only since 2005 it is believed that a complete review of the geology and mineral exploration potential is warranted subject to an analysis of the aeromagnetic data.

Perhaps the most significant area of known mineralisation is in the vicinity of the Talts Gully Mine. It is acknowledged by the tenement holder that the grea has not been fully tested. A review of the previous exploration is warranted followed by detailed mapping and drilling.

A preliminary review of regional gravity data by Peel Exploration has revealed a circular gravity anomaly (Blue Moon prospect) in the northern portion of the area where the basement geology is obscured by a covering of Tertiary basalt. The nature and mineralogical significance of this anomaly cannot be assessed without further work by means of detailed surface mapping, ground magnetics and drilling.

Conclusion

The NEFB is a highly mineralised area but there has been very little systematic exploration for over 25 years. This has been in part due to the lack of any significant advances in the understanding of the regional geology since that time. Over the period 1998-2002 the DPI has conducted a series of regional aeromagnetic surveys in the region and a review of these data has lead to a better understanding of the stratigraphic, structural and mineralogical relationships.

Peel Exploration has identified four areas containing the potential for the discovery of VHMS style base metal deposits (EL 6613 and EL 6614) as well has vein hosted gold (and or silver) and base metal deposits (all areas). With the new data, better understanding of the geology and a systematic approach to the exploration there is a good chance of discovering an economic deposit in one or more of the areas.

I blayden

I.D. Blayden PhD MBA BSc MAusIMM MMICA CPGeo Principal Consultant 7 March 2007

Geological and Management Services Pty Ltd ABN 47 001 256 248 Unit 7, Level 3 Charles Plaza 66 King St Sydney NSW 2000 Ph: (02) 9299 5591 Mob: 0417 461 262

14⁸⁹ March 2007

$\overline{7}$

The Directors Peel Exploration Limited 79 Hay Street SUBJĀCO WA SONS

Horwath Securities (WA) Pty Ltd

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Dear Sirs

Investigating Accountant's Report

1. Introduction

This report has been prepared at the request of the directors of Peel Exploration Limited ("Peel Exploration or the Company") for inclusion in a Prospectus to be dated in March 2007 inviting participation in the issue by Peel Exploration Limited of 15:000.000 ordinary fully paid shares at an issue price of \$0.20 each to raise \$3,000,000.

All emounts are expressed in Australian Dollars unless otherwise stated.

Ż. Background

Peel Exploration was incorporated on 20^th April 2006 with the objective of seeking concritualities to obtain prospective properties to undertake mineral exploration.

$3^{\circ}$ Capital Structure

The expected capital structure of the Company following the completion of the Offer is as tollows:

Shares	Number
Shares on issue at date of Prospectus,	15,000,000
Shares now offered	15,000,000
Total Shares on issue at completion of the Offer	30,000,000
Options
Options issued to Directors on 8 th March 2007	7,500,000
Options issued to Shareholders on 8" March 2007"	7,500,000
Total Options on issue at completion of the Offer	15,000,000

đ., Basis of Preparation

This report has been included in this Prospectus to assist investors and their financial advisers to make an assessment of the financial position and performance of Peel Exploration. This report does not address the rights attaching to the shares to be issued in accordance with this Prospectus, nor the risks associated with the investment...

The Directors of Peel Exploration have requested Horwath Securities (WA) Ptv Ltd ("Horwath") to prepare an investigating Accountant's Report for inclusion in this Prospectus dealing with the following financial and other information:

• (ï) the reviewed income statement of Peel Exploration for the period from incorporation on 20 April 2006 to 31 December 2006:
• n the reviewed statement of changes in equity of Peel Exploration for the period from incorporation on 20 April 2006 to 31 December 2006:
• (前) the reviewed cashflow statement of Peet Exploration for the period from incorporation on 20 April 2006 to 31 December 2006:
• (M) the reviewed balance sheet of Peel Exploration as at 31 December 2006; and
• ťν). the reviewed proforma balance sheet of Peel Exploration as at 31 December 2006 adjusted to include funds to be raised by the Prospectus, and the completion of the transactions referred to in Note 2 of Appendix 2.

Б. Scope of Review

Our review has been conducted in accordance with Audling Standard AUS 902 "Review of Financial Reports".

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.

The Directors of Peel Exploration Limited have prepared and are responsible for the historical financial information. We disclaim any responsibility for any reliance on this report or on the financial information to which it relates for any purposes other than that for which it was prepared. This report should be read in conjunction with the Prospectus.

Ë. Statement

Based on our review, which is not an audit, nothing has come to our attention that causes us to believe that the financial information as set out in Appendix 1 and 2 does not present fairly:

• the results of Peel Exploration for the period ended 31 December 2006: {i)
• the statement of changes in equity of Peel Exploration for the period ended (前) 31 December 2006:

• the balance sheet of Peel Exploration as at 31 December 2006; ₫iii}
• ≰ÍV) the cashflow statement of Peet Exploration for the period ended 31 December 2006; and
• the proforma balance sheet of Peel Exploration as at 31 December 2006. (分) adiusted to include funds to be raised by the Prospectus and the completion of the transactions referred to in Note 2 of Appendix 2.

in accordance with the accounting methodology required by applicable Australian equivalents to international Financial Reporting Standards and the accounting policies adopted by Peel Exploration as described in Note 1 and on the basis of the assumptions and transactions set out in Appendix 2.

晋. Declarations

• Howeth will be paid a fee of \$7,500 based upon normal charge rates and 後 professional time incurred in the complistion of information and the preparation of this report. The involvement of Horwath in the preparation of this Prospectus is limited to the preparation of this report other than Horwath Audit (WA) Pty Ltd is the Auditor of the Company;
• Howath was not involved in any other aspect of this Prospectus and did ≰b) not authorise or cause the issue of any other part of this Prospectus and we have only issued our consent in respect of the inclusion of this report in this Prospectus:
• The author of this report does not have any interest in Peel Exploration or ${C}$ the shares offered by this Prospectus;
• The giving of our consent for the inclusion of this report in this Prospectus. ≰d} should not be taken as an endorsement of Peel Exploration or a recommendation by Horwalth of any participation in the offer by any intending investors;
• The author of this report gives no assurance or quarantee whatsoever in ≸i⊖≱. respect of the future success of or financial returns associated with the subscription for shares being offered pursuant to this Prospectus; and
• This report should be read as a whole and no part of it curred, otherwise 线) referred to or produced without prior written consent of Horwath.

Yours sincerely HORWATH SECURITIES (WA) PTY LTD

$\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1}{2}$ = $\frac{1$

Cesso Company

GLYN O'BRIEN Director:

INCOME STATEMENT For the period from 20 th April 2006 to 31 th December 2006	Neviewed 31 December 2046 鸾
Revenue from continuing activities	88
Expenditure
Advertising exploration licences.	726
Auditors remuneration.	4.200
Exploration expenditure	338
Formation experises	1.164
Sundry expenses	博恩愛
Travel and accommodation	1.215
Loss before income tax	(7.834)
Income tax expense	-0000000000000000000000000000000000000
Loss for the period	(7, 834)
Loss attributable to members of Peel Exploration	(7.834)

This Income Statement is to be read in conjunction with Appendix 2.

STATEMENT OF CHANGES IN EQUITY For the period from 20 th April 2006 to 31 st December 2006	Reviewed 31 December 2006 奮
Equity at the beginning of the period
(Loss) for the period	(7.834)
Transactions with equity holders in their capacity as equity hoiders
Contributions of equity	22.800
Transaction costs of equity issues
Total equity at the end of the financial period.	14.966

This Statement of Changes in Equity is to be read in conjunction with Appendix 2.

BALANCE SHEETS As at 31 st December 2006	Note	Reviewed 31 December 2006 Ż	Proforma capital raising S
Current Assets
Cash & Cash Equivalents	ġ.	2,746	2,750,738
Trade & Other Receivables	4	420	420
		3,166	2,751,158
Non-Current Assets
Receivables	5	20,000	20,000
Plant & Equipment	6.	2.443	2,443
Exploration Assets	ŋ.	7.985	7.985
		30,428	30,428
Total Assets		33,594	2,781,506
Current liabilities
Trade & other payables	8	4,620	4,620
Borrowings	ĝ	14,008
		18,628	4.620
Net Assets		14,966	2,776,966
Equiy
Issued capital	10	22.800	2.784.800
Option Reserve	蓄量		322,500
Accumulated losses	12	(7.834)	(330.334)
Total Equity		14.966	2,776,966

These Balance Sheets are to be read in conjunction with Appendix 2.

CASH FLOW STATEMENT For the period from 20 th April 2006 to 31* December 2006	Note	Reviewed 31 December 1 2006 塞
Cash flows from operating activities
Payments to suppliers and employees		(3,634)
Net cash outflow from operating activities		(3,634)
Cash flows from investing activities.
Payments for plant & equipment		(2, 443)
Payments for exploration assets		(7, 985)
Funds placed on deposit		(20,000)
Net cash outflow from investing activities		(30, 428)
Cash flows from thencing activities
Proceeds from borrowings.		14,008
Proceeds from issue of shares		22,800
Net cash inflow from financing activities:		36.808
Net increase in cash and cash equivalents		2746
Cash and cash equivalents at the beginning of the period		w.
Cash and cash equivalents at the end of the financial period	З	2746

This Cash Flow Statement is to be read in conjunction with Appendix 2.

АРРЕNDIХ 2

PEEL EXPLORATION LIMITED

FINANCIAL INFORMATION For The Period Ended 31 December 2006

NOTE 1: BASIS OF PREPARATION

The financial information has been prepared in accordance with Australian equivalents to Financial Reporting Standards (AFRSS) International dther authoritative pronouncements of the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the Corporations Act 2001. The financial information is presented in abbreviated form insofar as it does not comply with all of the disclosure requirements set out in the AIFRS and the Corporations Act $2001$ .

The financial information has been prepared on the basis of historical costs except where stated.

The principal accounting policies relating to the financial information are described below.

Accounting Policies

${a}$ Income tax:

The charge for current income tax expenses is based on the profit for the year adjusted for any non-assessable or disallowed liems. It is calculated using the 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 base of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised 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 is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is settled. Deferred tax is credited in the income statement. except where it relates to items that may be credited directly to equity, in which case the deterned tax is adjusted directly against equity.

Deferred income tax assets are recognised to the extent that it is probable that future profit 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.

fbi Property, plant and equipment

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

Plant and equipment

Plant and equipment is measured on the cost basis less depreciation and impairment losses.

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 that will be received from the assets employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.

Depreciation

The decreciable amount of all fixed assets is depreciated on a straight-fine basis over their useful lives to the economic entity commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

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

Plant and equipment

7:50 - 37.50%

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying annount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the income statement.

Exploration and development expenditure tc)

Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.

Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the decision to abandon the area is made.

When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the economically recoverable reserves.

$(c)$ Exploration and development expenditure (continued)

A regular review is undertaken of each area of interest to determine the appropriateness. of continuing to carry forward costs in relation to that area of interest.

Costs of site resionalion are provided over the life of the facility from when exploration commences and are included in the costs of that stage. Sile restoration costs include the dismantling and removal of mining plant, equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of the mining permits. Such costs have been determined using estimates of future costs, current legal requirements and technology on a discounted basis.

Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations and future legislation. Accordingly the costs have been determined on the basis that the restoration will be completed within one year of abandoning the site.

fdi Impairment of assets

At each reporting date, the Company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate, cash flows that are independent from other assets, the Company estimates the recoverable amount of the castivgenerating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-lax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset for cash-generating unit) is estimated to be less. than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment toss is recognised in the profit or loss. immediately, unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation decrease. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but only to the extent that the increased cartying amount does not exceed the cartying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior vears.

A reversal of an impairment loss is recognised in the profit or loss immediately, unless the relevant asset is carried at fair value. In which case the impairment loss is treated as a revaluation increase.

ťe) Revenue recognition

Interest income is recognised on a time proportionate basis that takes into account the effective yield on the financial asset.

АРРЕNDIX 2

俏 Loans and receivables

Loaris and receivables are rion-derivative financial assets with fixed or determinable payments that are not cucked in an active market and are stated at amortised cost using the effective interest rate method.

$(a)$ Cash and cash equivalents

Cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current sabilities on the balance sheet.

Goods and services tax (GST) (h)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as: part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST.

Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

ĨÎ. Trade payables

Trade payables and other payables are carried at cost which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the company.

Contributed equity Ĥ.

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from proceeds. Incremental costs directly attributable to the issue of new shares or options, or for the acquisition of a business, are included in the cost of the acquisition as part of the purchase consideration.

Share based payments: (k)

The fair value of cotions cranted are recognised as an employee benefit expense weh a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which the employees become unconditionally entitied to the cotions.

The fair value at grant date is determined using a Black-Scholes cotion pricing model that takes into account the exercise price. the term of the option, the vesting and performance criteria, the impact of dilution, the non-tradeable nature of the cotion, the share price at crent date and expected price votatility of the underlying share, the expected dividend vield and the risk-free interest rate for the term of the cotion.

АРРЕNDIХ 2

Share based payments (continued) fki

.
The fair value of the collicits cranted excludes the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of octions that are expected to become exercisable. At each balance sheet date, the entity revises its estimate of the number of options that are expected to become exercisable. The employee benefit expense recognised each period takes into account the most recent estimate.

Upon the exercise of options, the balance of the share-based payments reserve relating to those options is transferred to share capital.

The dilutive effect of outstanding cotions may be reflected as additional share dilution in the consulation of earnings per share.

Comparative information t₿

This is the first reporting period of the company and as such there are no comparative figures. The company also has no changes arising from the transition from AGAAP to: AIFRS as it has not previously prepared financial statements in accordance with AGAAP. The company was incorporated in Australia on 20 April 2006,

$\overline{2}$ . Actual and proposed transactions to arrive at proforma balance sheet

The protorma balance sheet reflects the 31 December 2008 balance sheet adjusted to reflect the effect of the actual and proposed transactions pursuant to the proposed capital raising. The transactions reflected in the proforma are as follows:

• The issue on 27 February 2007 of 10,200,000 ordinary shares to raise \$12,000.
• The issue on $8^{th}$ March 2007 of 7,500,000 options exercisable at 20 cents each on or $\blacksquare$ before 30 November 2010 to Shareholders:
• The issue on 8⁸⁹ March 2007 of 7,500,000 options exercisable at 30 cents each on or $\blacksquare$ before 30 November 2010 to Directors.
• The issue of 15,000,000 ordinary shares at 20 cents each to raise \$3,000,000 in $\blacksquare$ accordance with the Prospectus:
• The payment of \$250,000 for capital raising costs; and $\blacksquare$
• The repayment of related party borrowings.

A Horwath

APPENDIX 2

Í., Cash & cash equivalents Cash & cash equivalents 2,746 2,750,738 Proforma adjustments As at 31 December 2006 2,746 Share placement on $27^{\text{th}}$ February 2007 12,000 Shares issued 3:000.000 脂瘤 pursuant ÒÙ. Prospectus 1 Less: capital raising costs (250, 000) ¥ Repayment of borrowings (14,008) 2,750,738 4. Trade & other receivables Trade & cther receivables. 420. 429 Receivables 5, 20.000 Security deposits 20,000 ₿. Plant & equipment 2,443 Plant & equipment 2.443 7. Exploration assets Exploration licences 7,985 7.985		Reviewed 31 December 2006	Proforma capital raising
		Š.	鸾

A Horwath

APPENDIX 2

	Малівири 31 December 2006 £.		Proforma capital raising S.
Ŝ., Trade & other payables Accounts payable	4.620		4.620
9. Borrowings Loans - Related Parties	14,008
10. Issued capital
Issued Capital	22,800		2,784,800
	Mumber		Ś
20 10 April 2006 -issued on incorporation 17 th July 2006 - raise working capital As at 31 December 2006		2,100,000 2,700,000 4.800.000		2100 20,700 22.800
Froforma adjustments $27^{\rm m}$ February $2007$ – raise working capital. à. Shares issued pursuant to this prospectus ٠ IPO capital raising costs œ.	10,200,000 15,000,000 30,000,000		3,000,000	12.000 (250,000) 2,784,800
11. Option Reserve
Option reserve			322.500
Proforma adjustments	Mumber		Ż.
Options issued to Shareholders on 0 th March 2007 Options issued to Directors on 8th March 2007	15,000,000	7,500,000 7;500,000	322,500 322.500

On 8^th March 2007; it was resolved to issue to existing shareholders 7,500,000 options as a bonus issue on a 1 cotion for every 2 shares held basis. The options are exercisable at \$0.20 each on or before 30° November 2010.

On 8th March 2007. It was resolved to issue to Directors 7,500,000 options for their services to the company. The options are exercisable at \$0.30 each on or before 30^th November 2010. The options have been independently valued using the black scholes and binomial cotton valuation models.

12. Accumulated losses

Accumulated losses	7.834	330,334
--------------------	-------	---------

13. Events subsequent to belance date

There have been no material items, transactions, or events subsequent to 31 December 2006 which relate to conditions existing at that balance date that require comment or adjustment to the figures in this report, except for those disclosed in note 2 of appendix 2.

FINANCIAL SERVICES GUIDE

.
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40 Contact details

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Web: www.sleinpag.com.au

20 March 2007

The Board of Directors Peel Exploration Limited 79 Hov Street SUBJACIO WA 6008

Dear Sirs

SQUCTOR'S REPORT ON TENEMENTS

This report is prepared for inclusion in a prospectus to be issued by Peel Exploration Limited (Peel Exploration or Company) on or about 20 March 2007 for the offer of 15,000,000 shares in the capital of the Company at an issue price of 20 cents per share to raise \$3,000,000 (Prospectus).

$\overline{\mathbf{1}}$ . ASSETS

This report relates to the interest of Peel Exploration in various mining tenements located in New South Wales (Tenements).

A schedule of the Tenements is attached to and forms part of this report (Schedule).

$\overline{\mathbf{z}}$ SEARCHES

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

we have reviewed searches of the Tenements in the reaisters 化 maintained by the New South Wales Department of Primary Industries (DPI). These searches were conducted on 13 February 2007 and 12 March 2007:

we have reviewed searches of the Register of Native Title Claims. (b) maintained by the National Native Title Tribunal (NNTT) in respect of native lifte claims affecting the Tenements. This material was obtained on 13 February 2007.

As a result of these searches, we consider that this report provides an accurate statement as to the status of the Tenements as at the date the relevant searches were obtained.

Peel Exploration's interests in and rights in relation to the Tenements are subject to the Company continuing to comply with the Mining Act 1992 (NSW) and other relevant legislations and the conditions subject to which each Tenement is granted.

$\mathbf{\hat{3}}$ . OPINION

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

• (CI the details of the Tenernents included in this report are accurate as to the status of the Tenements:
• all expenditure requirements in respect of the Tenements under the łb⊧ relevant mining lealslation have been met or exemptions obtained. unless otherwise noted in the Schedule: and
• (二) the grant of any of the Tenements may be invalid urless there has been compliance with the provisions of the Native Title Act 1993 (Cital as amended by the Native Title Amendment Act 1998 (Cth).

4. TENEMENTS

The Tenements comprise exploration licences granted under the Mining Act 1992 (NSW) (NSW Mining Act).

${\mathbf{G}}$ Exploration Licence

The Tenements are granted exploration licenses in respect to Group 1 minerall, which are metallic minerals such as gald, sliver and coaper.

An explaration licence issued under the NSW Mining Act gives the holder exclusive rights to explare for the minerals specified in the area covered by the licence. An exploration licence takes effect on the date on which it is granted and ceases to have effect at the expiration. of such period (not exceeding 5 years) as the relevant Minister may determine.

It is necessary to enter into an access agreement with all landholders. prior to carrying out exploration (section 140). All landholders are entitied to compensation for all compensable loss caused by exploration (section 263) and mining (section 265). In the event that no agreement can be reached with the landholders. the matter can be referred to arbitration, and if not resolved there, the Mining Warden for defemination.

Exploration licences are renewed under the provisions of the NSW Mining Act. If a holder intends to carry out further exploration within an exploration licence after the expliy date, the holder must apply for a 3 renewal of the licence. Applications for renewal must be made no earlier than two months and no later than one month before the expiry date (section 113). If a valid apolication for renewal is not dealt with betore the expiry date, the licence remains in force until the application is dealt with (seation 117).

An explaration licence may not be renewed for more than half the area of the licence at the time of lodgement of the renewal application (section 116), unless special circumstances are applicable. On renewal, exploration licences can be any shape but cannot comprise more than 5 individual areas.

An exploration licence may be renewed for a maximum term of five years and may be renewed for further periods not exceeding five years. on any one occasion.

សេរ Generally Applicable Conditions

Miring tenements are granted subject to variass conditions prescribed by the NSW Mining Act including compliance with minimum expenditure and reporting requirements.

The Tenements are also subject to statutory requirements of certain other Acts including Aberiginal heritage legislation, environmental protection leastation and rights in water leastation. These standard conditions are not detailed in the nates to the Schedule.

$\overline{\mathbf{s}}$ . ABORIGINAL HERITAGE

$5.1$ General

There may be creat or objects of Aboriginal heritage located on the Tenements.

We have not undertaken searches to ascertain if any Aboriginal sites or objects have been reaktered in the vicinity of the Tenements as there is no obliqation under the relevant leaklation to reakter such sites ar objects. Eurther, the exact location of Abericinal sites can not be ascertained from these searches.

The Company must ensure that it is in compliance with the Commanwealth and New South Wales legislation relating to Aboriginal heritage as set out below. To ensure that it does not contravene such tealslation, the Company would need to conduct heritage surveys to determine if any Aboriginal areas or objects exist within the grea of the Tenements. Any interference with these sites must be in strict contamity with the provisions of the relevant legislation. It may also be necessary for the Company to enter into separate amangements with the Inditional averses of the sites.

5.2 Commonwealth Legislation

The Aboriginal and Torres Strait Islander Heritage Protection Act 1984 (Cth) (Commonwealth Heritage Act) is climed at the preservation and protection of any Abariginal 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 oblects, which have the potential to half exploration activities. Compensation is payable by the Minister for Aboriginal Affairs to a person who is or is likely to be, affected by a permanent decitaration of preservation.

It is an offence to contravene a declaration made under the Commanwealth Heritage Act.

5.3 New South Wales Lealslation

The National Parks and Wildlife Act 1974 (NSW) (NPWA) is olmed at the preservation and protection of any Aboriginal places and objects that may be lacated on the Tenements.

Under the NPWA, the Minister administering the NPWA may declare a place to be protected where that place is deemed to have special significance to Aboridinal culture.

It is an offence to destroy, deface, damage or desecrate, or cause or permit the destruction, defacement, damage or desecration of an Aboriginal object or Abericinal place without a heritage impact permit issued by the Director-General of the Department of Environmental and Conservation pursuant to section 90 of the NPWA. There is a defence to this offence where a party acts with due dilgence and reasonable precaution.

NATIVE TITLE - LEGISLATION 6.

61 General

On 3 June 1992, the High Court of Australia held in Mabo v. Queenstand (no.21) (1992) 175 CLR 1 /Mabo #21 that the common law of Australia recoanises a form of native title which reflects the entitlements of Aboriginal people to their traditional tands in accordance with their traditional laws and customs. In order to succeed in a native fille claim the persons making such claim must show that they enicy certain customary rights and privileges in respect of a particular area of land and that by these rights and privileges they have a connection with that laria.

In Mabo #2, the High Court held that native title could be extinguished through loss of traditional connection with the lond or by leaklative or executive actions which are inconsistent with the continued right to enjoy native title. In particular, native fille noy be extractived by the State:

• in) arantina a filte or interest in land, such as a freehold or leasehold filte; or
• 街走 appropriating ar reserving and using land for a public purpose such as public works.

which is inconsistent with the continued right to enjoy native title in respect of the same land. Extinguishment may be whole or partial depending upon the nature of the State's action. The principles concerning extinguishment have been developed in subsequent High Court and Federal Court decisions.

The grant of a mining tenement only partially extinguishes native title rights and interests. Under Section 44H of the NTA and at common law, the rights held under mining tenements will prevail over any inconsistent native title rights. In the case of exploration ficences, recent court decisions have held that there is considerable scope for the co-existence of native title rights and the exploration ficensee's rights.

The Commonwealth Patiliament responded to the Mabo decision by passing the Native Title Act 1993 (Ctn) (NTA). This Act enabled a State Parliament to validate any mining tenements granted prior to its commencement which midni atherwise have been invalid.

The NTA was extensively amended by the Native Title Amendment Act 1998 (Cth). These amendments include the validation of any titles that may have been invalidiy aranted over pastoral leases and certain offrer leasehold interests during the period | January 1994 to 23 December 1996. Other significant amendments include a revised threshold lest for the acceptance of native litle claims, confirmation of extinguishment of native title by the grant of "exclusive possession" pastaral leases and certain other leasehold interests and provisions intended to deal with overlapping claims.

New South Wales 6.2

The New South Wales Parliament has adopted the Native Title (New South Watest Act 1994 (NSW) waich actor the NTA.

Under the NTA, native title is extinguished by grants of private freehold title and exclusive possession tenures such as freehold leases. Validly granted mining tenements that are to be aronted solely over such tenures are not sublect to native title considerations.

Tenures which may co-exist with native title are generally non-exclusive leases such as pastoral leases, pastoral development holdings, some special leases and term leases for arazing pastoral purposes, occupation licences, permits to accupy, road licences and some others.

We have not researched the underlying land tenure in respect of the Tenements in order to determine the extent of extinguishment of native title for the purposes of this report.

$\overline{T}$ NATIVE TITLE - CLAIMS

Persons claiming to hold native title may lodge an application for determination of native title with the Federal Court. The Court will then refer the application to the Native Title Reaistrar for the reaistration test.

If the Native Title Reakstrar is satisfied that the ladged claim meets the realstration requirements set out in the NTA (Registration Test), it will be entered on the Register of Native Title Claims maintained by the National Native Title Tribunal (Register). Claimants of registered claims are afforded certain procedural rights under the NIA including the "right to negotiate".

Claims which fail to meet the Registration Test are recorded on the Schedule of Applications Received. Such claims may be entered on the Reaister at a later date if additional information is provided by the claimant that satisfies the Registration Test, If a claim fails to meet the Reaktration Test, this only means that the native lifte claimants do not have access to the future act procedures under the NTA. It does not mean that the claim has been dismissed or discontinued. An unregistered claim must still be heard and determined by the Federal Court.

We have not undertaken the considerable historical anthropological and ethnoaraphic work that would be required to determine the likelihood that existing claims may be successful, or the possibility of any further native title claims being made in the future.

In any event, the existence of native title is not the main issue for the Company as the registered holder of the Tenements. The main issue is the existence of a registered native title claim. That effectively requires the Company to observe the provisions of the NTA in relation to the grant of the Tenements. The reason for this is that an act which affects native title rights such as the grant of a mining. tenement may be invalid unless there has been compliance with the pravisions of the NTA, Until the native title claim has been determined by the Federal Court the existence of native fifte will be uncertain. Prudence dictates that native title should be assumed to exist over all cirrimed krnd other than freehold. "exclusive possession" leasehold ar vested reserve until the claim has been determined.

As at the date of this report, searches of the Reakter of Native Title Claims maintained by the NNT indicate that no native tille claims exists in respect of the Tenements. However, it is possible that claims may be made in the future.

魯. NATIVE TITLE - VALIDITY OF TITLES

All of the Company's Tenements have been granted since 23 December 1996. Mining tenements granted since 23 December 1996 may be invalid if they were aranted over land other than freehold, "exclusive possession" teasehold or vested reserve and the applicable processes prescribed by the NTA were not complied with.

So in summary, on the basis that the procedural requirements of the NTA were complied with prior to their grant, each of those Tenements is valid so far as native title is concerned.

$\bullet$ . QUALIFICATIONS

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

• we have assumed the accuracy and completeness of all tenernent tal. 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 nat registered as a dealing, encumbrance or otherwise noted on the searches of the Tenements:
• with respect to the Tenements, we have assumed the accuracy and む completeness of the information which we have received from the various departments:
• 記 the holding of the Tenements is subject to compliance with the terms and conditions and the provisions of the applicable state mining. leaislation:
• we have assumed the accuracy and completeness of any instructions. €ΦÎ or information which we have received from the Company or any of its officers, agents and representatives;
• 檢】 where compliance with the reautrements necessary to maintain a Tenement in good skanding is not disclosed on the face of the searches referred to in this report, we express no apinion an such compliance;
• 组 references in the Schedule to any area of lond 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: and
• the intamption in the Schedule is accurate as at the date the relevant (G) searches were obtained. We cannot comment on whether any changes have accurred in respect of the Tenements between the date of the searches and the date of the Prospectus.

$10.$ CONSENT

This report is given solely for the benefit of the Company and the directors of the Company in connection with the issue of the Prospectus and is not to be relied on or disclosed to any other person or used for any other purpose or quoted or referred to in any public document or filed with any government body or other person without our prior consent.

Yours faithfully

Henrywild

STEINEPREIS PAGANIN

r
1

TENEMENT SCHEDULE

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S.	22100378	黑眼熱	TACCACT	26 (22.97
	2008年3月14日	COLL OWNER	等等さい 診想に	1000 000000000000000000000000000000000
	Peel Engineering Ltd	Pressi (Soccionarios List	Fascing States (September)	Pressi Harashara Lau
	Chast	A.ssite	83.877.8	経営業

Key to lenement Schedule

$\mathbb{N}$ . $\mathbb{R}$ , and $\mathbb{R}$

Sound State of the Sound State of the Contract State of the Contract State of Company Contract Contract Company

Redeening to the monitor of the "control control to the monitory of the model of the transfer

Notes. At terrors are stript to the standard craterial conference contents contents the stand contents of the substants.

Expendention Soveroid Conditions 2004

Section & APPROVAL OF PROSPECTING OPERATIONS

Prospecting Operations Permitted under the licence uni
1

The productive condition of the state of the contract of the state of the state of the condition $\Omega$ and $\Omega$

• ha cangular an sol cours hum thus that we be at the production of calculating and an except of he seemed in this model in this case in the control of the production of the control of the control of the control of the contr À
• the conservations to my three properties of complete the conservation of the conservative in the conservation of the conservations of the conservations of the conservation of the conservation of the conservation of the con ã
• et of logistic than the closure of the second of the conjunction of a logistic conjunction Ţ.
• the conditions of the clause distribution to the Videos and finitial function and in section 230 of the Act Ý,
• The Control of Control of the Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Control of Contr 2
• Net enang di Samo Cazamananico, Samo Kasa Samo Samo Samo Samo Samo Samo Samo Cana net tra net instituo da caran XX)

Los Controls A Surger Control of Section Section Control Control A Surger r.

A presenting operator consent the Condition ( exclude the colditional department functor consentations)

• prospecing vanaval in Colean in Coleaguly I where the province interest under University in the scriptional scription É
• antage clings caused for series in Collegery 2 or 2; on 3; ě
• A DAY THE CONFIDENTIAL CONFIDENCE OF A SHORTLAND CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CON Į

a particular de la de la de la de de la contrada en la de la de la de la de la de la de la de la de la de la d

condednies and the company is the Department, also consideration of the considerations including haloe have defermine a fill mest be programed under headen in the state of the state of the control and the control of the control of the state of the space of the state of the state of the state of the state of the state of the state of the state of the sta in the condition of Mand and the collection of the collection of the collect of the collect of $\mathbb{R}^n$ and the collection of $\mathbb{R}^n$ and the collection of $\mathbb{R}^n$ and $\mathbb{R}^n$ and $\mathbb{R}^n$ and $\mathbb{R}^n$ and achintak la teraput in harra 5 al bu P&A Ath Herr dan Danali wan wanan kanan bungang la mahar la manaman manang mana 1991.

har harmor hakdu mar aat commonant op na nama aa wikay waa ma ankan ana an an han han ting (hayathman).

1000000 \$ . SPECIAL AREA CONDITIONS

Exempted Areas ηý

roka na mana kati kati wa mana ya mana ya ma mana kati wa mana wa mana mana wa mana wa mana wa mana ma mana ma

twere or the strate of the strate of the strate relations in the second compact that realishes while the strate of the strate of the strate of the strate of the strate of the strate of the strate of the strate of the strat rasminicamican 20 of 1749 2001 20 of 1749 2002 2012 2013 2022 2023 2023 2023 2023 is complete move that of completes a line distribution of meaning caracters and defermination under the field and

the state is the Midshare acomount of the Economic state in the state of the special state of the conditions of the conditions and the constants of the constraints of the constants of the constants of the state of the stat wathan worker (2014) and the strict of the Applier School Consequent of the strict of Consequence of the state of the Strict of Consequent in the Consequent of the Consequent of the Consequent of the Consequent of the Cons reductions in the substraints and to make more and comparison and comparison another the consequent comparison and the street is the individual to the individual the street in the street in the street in the street in the and and also as a construction of the compart of the Decompance of the sequent of the sequent construction of the construction of the construction of the construction of the construction of the construction of the construc

Applicas for the Market Control and the section of the second of the second of the Section of the Control of the Section of the Section of the Section of the Section of the Section of the Section of the Section of the Sect e a process the second of the control compared in the control with the control of the second of the control of the second of the second state of the second state of the second state of the second state of the second state

Notive the Areas aý.

Pre Rumana how must had packing on the of the workers over the red was who will would pack a million compared of we will be

Wednam Areas .,

$70$

		The foundations and that the constitutions are allowed with the production of the Development and the property of the constant to constant of a subject to the subject to the subject to the subject to the subject to the su Missioner THE CONSUMER OF A REAL PROPERTY OF A REAL PROPERTY.
Sections 5		EMVROMMENTAL MANAGEMENT OF PROJEKTO OFERATONS
2		Envisosental Mancagement Conditions
	Ż	consider of the serve of the cause of the consequent of the consequence of the consequence of the internal orient of the consequence of the consequence of the consequence of the consequence of the consequence of the conseq
	ē	when he grownilly of narrange (of covalism of our red in two party of and coval and to me in the conditions of this increase and are entered as the conditional and the conditional and conditional conditional conditions of Š
		$16(25, 17, 33(24) \mod 21]$ experiments are all $16(1)$ experiments. Capacident China China (2) A. P. ŵ,
		CONSERVANCE CONSUMER SAMPLE OF A SE)
	Ĩ.	tor France of Sactions to the Control of the Adj Constanting of the Saction of the Saction of Sactions in Sactions of Sactions of Sactions of Sactions of Sactions of Sactions of Sactions of Sactions of Sactions of Sactions RESEARCHERS
	Ī	act, Covaliform i in a onul it hold it in the lates in the formulation of the state of the context metal of the local interfact. I HARA OF THING IS RELATION TO BE CONFIDENT (it was the magnetic comparison with ter source of this search of the search of the
Ē.		\$P\$\$P\$3D - \$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$
	I.	evolutions of changes in a structure of the controlling to come and the evolutions of the controlling it comes controlly in the compact of the structure of controlling to the controlling of the compact of the structure of angene per Per godhan ta Hundre gene ng maha sa hit i nagman ng hundre Person.
		howarn Expondity 1996 Commonwealth Oxyountment of the Environment card Healtype of "Culdelanes for Environmentatives Research Minerial Exploring to NSW 1998 NSW Minerials Council 185 CHARLES SURFAIRING LOCAL CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF CASE OF
	ā	acons of Chington diverting to the school to a notherment to precise the one ching Maximum show that . When diverted in whisting the fire an the spotations or fax is specific registered of the anarothers. The EMP must be specified in taking varial without our Department. Oastrunt we krant rought award The Check to the first specified to a reflect that the specified that is very
9.		Aboditional Cuttural Rests
	Q	enia pang pang pangkan kumumiya kuma manga pangangan ng kang kang kang kang kang panding la Guidanng ka diangkahangga into a security. Other that is the cross of the same is micratical conditions of the security is the second to ${890}$
	Ē	Anualithu Luttuna kana kana seta ya sulatan ya katika da kati ya da matinduka unda (mati 2001) 2 di sha kasu mul
	Ï	MATHE PORTAN AN SOLONG A GEORG A GEORG AND AN ANGLE OF AN ANGLE OF A MATHEMATIC AND AN ANGLOSY ANGLOSY ANG ANGL The function must inke of monetary predictions in this contributy of this stational the band operator and auth usder the Number Ports you William Act 1974. desites, definition or during
in) an		近年を1928年に1929年に、A 1002年に、A 1002年に、A 1002年に、A 1002年に、A 1002年によるという。 1920年に、A 1002年には1920年に、A 1002年には、

$\frac{1}{\mu m}$

a i okončin kolem je po predstavanja po predstavanja po po predstavanja i okolem je po po predstavanja po po p ġ. isting.
. line security security security security security security security security security security security security security security security security security security security security security security security security ļ. l. $\frac{\partial \tilde{A}}{\partial \tilde{B}}$

• 的复数 的复数医学的复数 化硫酸 的复数人名英格兰人姓氏德国的变体 医心包的 医心包的 医心包的 医心包的 医心包的 医心包的 医心包的 医心包的 ensingings memeraka ang bagi padi nating ang mikana mga pada pan ipa makiles ta mianana san pepang. a.
• throduced social constants and complete computer which we are then both in the subject why outcreat in ony rations condition 2 of New Reserves: arrel $\overline{\Xi}$
• ana man mang tinang kapang kang to kang natak natawi nang mengangkin commakan nang mang natang tahun Syang nan
  Manang mang di komung matawang nong mang nang ng matik na inang kanan kang kanan ati Pali mang kanan mang nang KUNGKANA . $\widetilde{\mathcal{L}}$

Nerticage (tems
I	and the special construction of the complete the second the special conditions on the special construction of the construction of the construction of herificant and the composition of the strong which will be a strong which school invests or as the strong of the strong strong which the strong which we have the strong which in the strong which in the strong which in the strong whic springeres:
É	beningse iteres wet be sould have a comparison of the notable produce the state of this found condi
S	of herburge shall are the orient except to concert on the on any system is such more thange at 1973, the lighted resider most red distrute early barn
	Trees and vegetaten
I	Pro licence must mat tell them. Ship kank or cul imper on any and utipes of the licence will be such the and the constituted in the south of the original real for the state of the state of $\pm$ some constructions are the construction of the construction of the consent, which is object to the higher consent of $\sim$
3	ted strates that the strate of the compact of the strate of the control of the strate of the strate of the strate of the strate of the strate of the strate of the strate of the strate of the strate of the strate of the str corsilions of the program ground property cluster and allowed and any conservation of the program of the program of the program of the program of the program of the program of the program of the program of the program of t THE NEW ACTIONS AND LONGITARY CONTINUES
ŝ	Rente hen the Secured Solute Mue Mues Division that which hume hume Courtes and the state of the Android Control of Control and Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Control Contro
	Roteds cost face: Ica
E	$\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$ and $\alpha$
E	opaventions must run office it in a creativity of critical value of expective direction for figures
O.	to the facture and to the deniminate authority of the control (persually for book and an exaction and further and the economical costs. rammed by the designated onlinkly a fishig on r dominge to could coment by radions compared out unles hearmor
Ī.	the specificat the second climate of the constitution and the second of the second structure of the state of the state of the state
Ë.	eng and the start that the system of the start of the start of the start of the start of the start of the start of the start of the start of the start of the start of the start of the start of the start of the start of the An about the charge for the hard production of the state of the state of the state of the state of the state of
€	me dans more and relations of constructions and the most mass areas who specifies given a more of the mones of the construction of radikon 21 oran 1944 ya 21 a 22 a 23 a 24 a 25 a 26 a 27 a 28 a 29 a 29 a 29 a 29 a 29 a 20 a 20 a 20
B	os an la home the subject the large man serve an experime that we have a source may be realished in the standard the subjection of the TAURER
Į	the file Quandilate and the second in reports may be developed the control of the Quandilate (15) [3]. TOPACINARY CHIPPERS AND CHICAGO STATES ON A SOLUTION
	Sheans use the Walescares

$\breve{\Xi}$

$\hat{\mathbf{a}}$

$\frac{\omega\delta}{\epsilon}$

the Same of the content of the content one of the content of the content will be a state of the content of the content of the content of the content of the content of the content of the content of the content of the conten (finantiac).

Section and Sectioners Controls ¥.

Ĕ

• of opering men and man group of the state of the state of the section control completed incompart incorrent incomparing the controller compared with the product compared with the compared of the December Compared incompare $\overline{\mathbb{Z}}$
• te operations requires camped todas Condition 2 free is mare realise valuations from or proportions napided a shan setting out the process
  Intrastival proprietival contrastival reference and the contrastival contrastival c I)
• the particulates undertakes to missine existent at social at social most management in the constant of accordance with Condition 2010. $\overline{\mathcal{G}}$

Prevestion and Montoising of Practice ŗ.

• he pose of his condition, when the fatter to relate any waternosse, worldteds, or groundwissers. The function must encert changing one formations any infractions are that and the complete the started for the complete of the complete the complete the complete the self-complete the control of the complete the complete the complete the complete the complete the complete the complete t given by the department in this regional: Ï
• ta camenta mento consecutive Condian 2 fem streets and a maximitate in creative of antication that security the property contributions of the consequence of political verse problem used with combining of problem ã
• ke kanca maa mai ya waka mai wana mai ya mai ya mai ya mai ya mai ya mai ya mai ya mai ya mai wa mai ya mai ya restraining of offections and J.
• he anxielate and wasaining of we accivited construction of particle incomplication and an controlly was incomplication to enable in accrementation 28 ld. Ã

Cheminian Fuels and Waste Ministerials Refuse, Ş

• ite, Mente, Hoskar Prakt Hoskar Southeart Marked San San San San San San San San San San Ï.
• en and antife transly in conservation in the charge of the control of the conditions of the condition of control that is the conservation of the conservation of the conservation of the conservation of the conservation of t superintent (an optimised location; Î
• ensing and the security of the second which that for the line of the line of the second of the second that the security consideration of the second that the second the second that the second that the second that the second SERVER SERVICE $\widetilde{\mathcal{G}}$
• an and the law in the state of the law in the contribution of the contribution of the contribution of the contribution of the contribution of the constant of the constant of the constant of the constant. to the collection that we then the collection of the contribution of the collection of the real collection of the side of Ï
• al al company and the confoling down anound surface in its product conformation of the grounder or the in-proved surge as profession of the problem of the problem of the problem of the problem of the problem of the control Ø
• any soficantra by chemicals, olsi direct substitution of the control metals considered in collect and comparing of charge of more more more. and he signalized with close and $\widehat{\mathfrak{S}_{\mathbb{Z}}}$
• acibiles...valence in regard to the Comilian must be induction presents prepared in ancordamic sativity distri Q

istesierission Lines, Commissionisses, Pipes, Pipes ond other Public Litisties ana)
Tog

• opsorisms mat risting with or ingon stability or effectively of one manimism and connections bas, pared on camp of packe with party without the grist without approved of the Ungratiment ered subject to any conditions that may the signature and ğ
• e bacomparting on onvents in the state of the secure which was balanced at the state of the state of the secure of the classis, to observe the state of the state of the state of the state of the state of the state of the s T.

Public and Private Property ష

eluksit van sigina sa sigina in simulana sigina kata ka ka ka ka ka ka ka ka ka ka ka ka ka

District Ř

• a level in controcament of different cynuclimos where they Called the grave is line in languary and the material control of Panning Regard
  Hydriade the thin the exhibit different together with him the outline and languary I
• If the sceene hostler differential andy child what the third suitify the Department fract during and villed the rackely 3
• di hoke contri to taletwick this identitied tradica wroted in anderent like costapes of 200 kmonuting huisce $\tilde{\omega}$

		$\frac{1}{2}$	an the state of the company of the company of the company of the company of the company of the company of the company of the company of the company of the company of the company of the company of the company of the company
		œ.	is stated and the since $\beta$ and is noticed contractively. In the contraction of undies, and is a serify model RECEIVED OF CHARTER Alt comercity of the second little Terry distincts ment an extent
		ž	e the control of the control of the collection of the control of the control of the collection of the collection of the control of the control of the control of the control of the control of the control of the control of t The contract of the contract of the contract of the contract of the contract of the contract of the contract of We take keep in the second to the second that the second that the second that the second that the second that
		$\mathbb{R}$	the confunction of the space confidency weakness to the country of the space of the second structure with constructions of the space of the space of the space of the space of the space of the space of the space of the spac esisr Eeris, hun tulik haan mud in thinigsd cod ansibesid. Oksaaz ol on y uch rolling waal be a notion e whe are (CDANA) and 2000 mor ing Deputations of Environment and Current Values CARINY GRADESHIES NO THRUST
		I	cover any stress courses for the street in sunding constants where you as to the manification of the complication of
		Ž	He wis and the state of the selection of the state of the state of the second of the state of the state of the Call Frankes unt clear for some present as
ré 94			Maintexance of Open Drigodies
			sanity awarooses. The Sasmone production are the compart of the compare the control of the production of the modified of a bundle the form of a bundle of a bundle of a bundle of a bundle of a bundle of a bundle of a bundle nness mast man and man home in early within the early of that is the could be the content to man be come to the content of the compact the content in an and the content in the compact in the compact in the compact in the dieno to bonico tojno so kergovaty na daj che o daj i con concerto da tranka ta sega o deta a para transe se di daj caso ka se de ta se de transe da transe da transe da transe da transe 19700 1000000000000000000000000000000000
Ŕ,		Remain Monday of Lary
	Í.		and counters recultive that to o students and the manner is a studied in a statement called the orientable to be Decambrer to but
		æ	hare a colomnic color of the distribution and the plane of the stand term of the standing the plane of consideration of the mass consequent
		Œ	ing an is dig the state of the production with the sample of the limit one is use use the all
		Ÿ.	the same, and a match to the moduling to choosing resultation of a match that the same same resultation
		Ż	a daan minisa nabadhad haraa mada da daraagad jand whan wagala lan a naqabay ayadan ka ka mada daa mada da aya Value and the control of and encomplete material any reversations representer material in the terminal to the one of the solidate for the spatial conditions. which was the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of the compact of th
		$\sum_{i=1}^{n}$	Mark Start Company of the Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second Second
	È	Occupation of	ang dalawang kampung kata ng mang kampung mang kampung mang kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung kampung ka
	g.		na ti kom se va sa sa mana sa sa sa sa sa sa sa sa sa sa sa sa sa the second set of a consequence of the consequence of the second consequence of the second consequence of the consequence of the consequence of the consequence of the consequence of the consequence of the consequence of th crew should club the care of exceptions, then
	Ī		ch estadou de disposito a comparte de la comparte de comparte de la comparte de la comparte de la comparte de l
	È		go principalment in regard to relation must be included in except presents to a account refer for still on 28 (d)
es. V		Easylten Meade Republication
	Ë		on frequence and the collective recover that the solution of the Directive on the second
		уул. Тоо	ien meist in meiste en de kommen werden de kommen in de de de de de de meiste de meiste de haar de de de de de
		懲	the most would within two yount in the cape of multiple of the choice of the capital with one capital counter the condition of the Capital County of the Capital Capital Capital Capital Capital Capital Capital Capital Capit

		Q	an the sturing lowering by from the street. They studied include subject information to demonstrate real two the validation of the deportment and include triansport of surface distribut processions and analysis and the texturements of Consent excluding editions and the State of the State of the State of the State of the State of State of the State of State of State of State of State of State of State of State of State of State of State o CONNECT COLL in the Riverson Connect MARINESE POLIS DE DIVERSITAS TO
	Ä		Every as the cold first state we have the state of the state of the Description of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state
		$\tilde{\omega}''$	is a string within 24 loves and the string of constitution of the construction of Conditions 1 to 27 or them in the rest of the positivo or bressult of other development regulations, or a textion corresponded to relation the or the positio
			Part and the state of the exposure of the exponsive states which is the experiment content that the states invest the state of CONCRIT THE NOTIFY OF CONTRIGING ALL CALCULATIONS CONTRIGUES ON THE CONTRIGING SOFT OF SALES OF THE STANDOOR CONT
		Ø	(b) 58, relation was experiment in the compact of the second of the second of the second of the second of the second of the second of the second of the second of the second of the second of the second of the second of the
	Í		antificant meants may be used to a specific surface, charge discretives or experimental index is the constant in directed in variety by the USER WERE WERE THE LOCAL OR RESERVE WERE
ę.	Secretify
	ā		to which internative and the comparing the property of the control of the property of the state of the control of the control of the control of the second of the second of the second of the second of the second of the seco geng ang hing kung atawa ng kang kang pang ng mga ng mga ng mga ng mga nan mga ng mga ng mga nang ng mga ng mg sor of tailing and closuring are
	ă		the action match pricelate the success year management provide (a) in one of the Hallwood temper.
		Castri Ca æ
		æ,	a security candidations in a form approved by the Minister and Baued by an outhorized devasing institution.
ij		Failule to Fulls Cibiligations
			tes alresseed its increp tribed in held free catalogurisms of the accessor if the forgrave inviels for company welth Fice from manager of Chronicles Fr. Bree Rowships France Point
	Ţ.		Served the control of the Superior of the Supervisor
	Ī.		a produced the company of the company of cry covering to consent of cross concern given
	Q.		NEW SERVICE SECTION AND RELEASE OF THE ARREST CREWS CONSIDERED AT A 1990 AND RELEASE OF THE ABOVE AND RELEASE OF THE ABOVE AND RELEASE OF THE ABOVE AND RELEASED AND RELEASED AND RELEASED AND RELEASED AND RELEASED AND RELE
	ī		And the figure is comparison to the company of the company of the company of the company of the company of the out direction or other rainwalker given by the
Sections D		GENERAL CONDITONS
J.		Costrol of Operations
	Ī.	may divert has known have	if the Dagontment that the fount of the content controlled with providing of the productions of any condition of the Manus in the Dagon manus

		A She marity of true Request the shockers than the states below the control sequent
	J.	The Kingdom of the Control Hold of the Alliance of the Control Product of the Alliance of the Alliance of the A
÷,		salety of Casetulons
	Í.	the location invaligation to the Exponitunist of the Departic necline is gional offices of the point convenience in one foot a spier of the control and a spier of the control and a spier of the spier of the spier of the sp NASA MANAGEMBERAN NASA NASA NASA NASA NASA NASA NASA N
	À	escriptions with the constraint of the substants of the stription of the collect of the constraint of the stription of the stription of the stription of the stription of the stription of the stription of the stription of t
	Ţ.	stand with the Afree instant crown (171) (1721 Party and the Afree Stranger of 1981 Clemand Ride 2022). These manages include the main in the disperse of the product bandas internal and according to provide in the product of the cost of She statuted as in this is contact before
	Ÿ.	oppendikana wanati kue-gundi kanati kwandi ku kama kuwa ku makuwa ku ku kanati kwa kwa kwa kuma kuma kuka kuka
ļ.		\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$\$P\$
	E	M kurêcisina iran kiromayê girê kiromaya di kê dema di bi bi bi bi bi bi bi bi bi bi bi bi bi The East of Property of Second Property and Selections
	È.	the folder must have of only compact dump of the state of the state of the compact the offered and the compact mandel in compact of the compact of the compact of the compact of the compact of the compact of the compact of of he hows in states rately, are later to cause of shears and in continues that will continue in the fine in the hard made made harge plub Budpangan ang isa data ing kalipung sinah di kalipung panjangan kalipung
	3	these it shirtly that their club club clubs. The sign signification of which ine culturally han the Club slump selected case were see valued as the certain
See ethach E		纂 EXPLORATING REGRAMANIE AND REPORTING CONDETE
Ş	Expenditues
		crease candidates compromised the Description and the state of the creation of the candidate state of The lighten funder must alway an appropriate free former
	÷,	ATAS RANG MARKATAN RASA
	Ť.	1200 CMC AND CONVERTS FOR ELECTRIC
	Ÿ.	さん! BeiSi Alp company Books (Sign)
		1990 March Carlos Call
		werk in der der der bereitste der bereitste
ť.		Completion of Explorion Program
76		Any Courage to the Technical State and Any anders war to the second book in the special way in the conditions and the theorem and the conditions The Green's control within 1822 and 20 metals. the crigored by the Derivationed.

OERSE TROSGREUSSERS ENDRUSKES GENS DEUR DER BRIS HOLD OFFIKE $\frac{1}{2}$

Ę			sechnicus Management of Experiments
			Prospectives the to the completed or clearly supered by the Technical Monoger receive for the schools. The normal moderation many marker and the completed in the complete that a strain an an an an an an an an an an an an an
륳			SACARDINARY Reports (Fox Craigs 1 to 7 and Crease) St Mineralistic
			he formation model mage that the collection of the Decembration of the controlly completed interpret in problem in perime in the problem of the problem in the collection of generation out the spatification of the complete of and school of the state of the state of the state of the state of the state of the state of the state of the state of the state of the 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923 - 1923
	Ë,		Avaced Results and played within over culturing myster of the example of the fermand for the scenarion on the man stream of the constant of the constant of the constant of the constant of the constant of the constant of th
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$9₁$ RISK FACTORS

$9.1$ Introduction

An investment in the Company is not risk free and prospective new investors should consider the risk factors described below, together with information contained elsewhere in this Prospectus, before deciding whether to apply for Securities.

The following is not intended to be an exhaustive list of the risk factors to which the Company is exposed.

9.2 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 its ability to fund those activities.

Further, 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:

• $\alpha$ general economic outlook;
• $(b)$ interest rates and inflation rates;
• $\left( \circ \right)$ currency fluctuations;
• changes in investor sentiment toward particular market sectors; $(d)$
• $(e)$ the demand for, and supply of, capital; and
• $(f)$ terrorism or other hostilities.

9.3 Market Conditions

The market price of the Shares 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.

9.4 Exploration Success

The mineral tenements of the Company as described in this Prospectus are at various stages of exploration, and potential investors should understand that mineral exploration and development are high-risk undertakings.

There can be no assurance that exploration of the Tenements, or any other tenements that may be acquired in the future, will result in the discovery of an economic ore deposit. Even if an apparently viable deposit is identified, there is no guarantee that it can be economically exploited.

The exploration costs of the Company described in the Independent Geologist's Report are 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, accordinaly, 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.

9.5 Operating Risks

The operations of the Company may be affected by various factors, including failure to locate or identify mineral deposits; failure to achieve predicted arades in exploration and mining; operational and technical difficulties encountered in mining; difficulties in commissioning and operating plant and equipment; mechanical failure or plant breakdown; unanticipated metallurgical problems which may affect extraction costs; adverse weather conditions; industrial and environmental accidents; industrial disputes; and unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment.

Having been incorporated on 20 April 2006, the Company does not have any operating history, although it should be noted that the Company's directors have between them significant operational experience. No assurances can be given that the Company will achieve commercial viability through the successful exploration and/or mining of its tenement interests. Until the Company is able to realise value from its projects, it is likely to incur ongoing operating losses.

9.6 Resource Estimates

Resource estimates are expressions 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.

9.7 Commodity Price Volatility and Exchange Rate Risks

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 exchange rate risks. Commodity prices fluctuate and are affected by many factors beyond the control of the Company. Such factors include supply and demand fluctuations for precious and base metals, technological advancements, forward selling activities and other macro-economic factors.

Furthermore, international prices of various commodities are denominated in United States dollars, whereas the income and expenditure of the Company are and will be taken into account in Australian currency, exposing the Company to the fluctuations and volatility of the rate of exchange between the United States dollar and the Australian dollar as determined in international markets.

9.8 Environmental Risks

The operations and proposed activities of the Company are subject to State and Federal laws and regulation concerning the environment. As with most exploration projects 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.

In this regard, the Department of Primary Industry in New South Wales from time to time reviews the environmental bonds that are placed on tenements. The Directors are not in a position to state whether a review is imminent or whether the outcome of such a review would be detrimental to the funding needs of the Company.

9.9 Title Risks and Native Title

Interests in tenements in Australia are aoverned by the respective State legislation and are evidenced by the granting of licences or leases. Each licence or lease is for a specific term and carries with it annual expenditure and reporting commitments, as well as other conditions requiring compliance. Consequently, the Company could lose title to or its interest in tenements if licence conditions are not met or if insufficient funds are available to meet expenditure commitments.

It is also possible that, in relation to tenements which the Company has an interest in or will in the future acquire such an interest, there may be areas over which legitimate common law native title rights of Aboriginal Australians exist. If native title rights do exist, the ability of the Company to gain access to 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.

The Directors will closely monitor the potential effect of native title claims involving tenements in which the Company has or may have an interest.

$9.10$ 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, it may be required to reduce the scope of its operations and scale back its exploration programmes as the case may be.

$9.11$ Reliance on Key Management

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.

$9.12$ 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.

$10.$ ADDITIONAL INFORMATION

$10.1$ Rights Attaching to Shares

The rights, privileges and restrictions attaching to Shares can be summarised as follows:

$(a)$ 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.

Voting Rights $(b)$

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:

• $(1)$ 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).
• $\langle \circ \rangle$ Dividend Rights

Subject to the rights of persons (if any) entitled to shares with special rights to dividend the Directors may declare a final dividend out of profits 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 authorise the payment or crediting by the Company to the shareholders of such interim dividends as appear to the Directors to be justified by the profits of the Company. Subject to the rights of persons (if any) entitled to shares with special rights as to dividend all dividends are to be declared and paid according to the amounts paid or credited as paid on the shares in respect of which the dividend is paid. 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 amona 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. Where an order is made for the windlng up of the Company or it is resolved by special resolution to wind up the Company, then on a distribution of assets to members, shares classified by ASX as restricted securities at the time of the commencement of the winding up shall rank in priority after all other shares.

Transfer of Shares $(e)$

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 Listina 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.

$10.2$ Rights Attaching to Options

There are currently two classes of Options on Issue, with varying exercise prices $(S0.20$ and $S0.30$ respectively).

The remaining terms and conditions of the Options are as follows:

• $(a)$ each Option entitles the holder to one (1) Share in the Company;
• $(b)$ the Options are exercisable at any time on or prior to 5.00pm (WST) on 30 November 2010 (Expiry Date) by completing an option exercise form and delivering it together with the payment for the number of Shares in respect of which the Options are exercised to the registered office of the Company;

• $\left( \circ \right)$ an Option does not confer the right to a change in exercise price or a change in the number of underlying securities over which the Option can be exercised:

• $(d)$ subject to the Corporations Act, the Listing Rules and the Company's Constitution, the Options are freely transferable;

• all Shares issued upon exercise of the Options will rank pari passu in all $(e)$ respects with the Company's then issued Shares. The Company will apply for quotation of the Options and all Shares issued upon exercise of the Options on ASX:
• $(f)$ there are no participating rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 7 Business Days after the issue is announced. This will give Option holders the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue; and
• If at any time the issued capital of the Company is reconstructed, all $\langle \Omega \rangle$ rights of an Option holder are to be changed in a manner consistent with the Corporations Act and the Listing Rules.

10.3 Disclosure of Interests

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 Shares and Options as set out in the table below:

Director	Shares	Options $$0.30$ exercise)	Options $(§0.20$ exercise)
Michael Kiernan	3,000,000	2,500,000	1,500,000
Rob Tyson	2,500,000	2,500,000	1,250,000
Simon Hadfield	2,500,000	2,500,000	1,250,000

$10.4$ Remuneration

The Company's 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 \$300,000 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.

In the 2 years prior to the date of this Prospectus, none of the Directors received any remuneration from the Company.

From the date the Company lists on ASX, it is proposed that the Directors will receive the following remuneration:

Director	Remuneration
Michael Kiernan	\$35,000
Rob Tyson	\$50,000
Simon Hadfield	\$30,000

$10.5$ 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;
• $\langle \circ \rangle$ promoter of the Company; or
• $(d)$ underwriter (but not a sub-underwriter) to the issue or a financial services licensee named in the Prospectus as a financial services licensee involved in the issue.

has, or had within 2 years before lodgement of this Prospectus with the ASIC, any interest in:

• $(e)$ the formation or promotion of the Company;
• $(f)$ 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
• $(q)$ 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 quality 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.

Horwarth (WA) Pty Limited 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 Horwarth (WA) Pty Limited a total of \$7,500 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, Horwarth (WA) Pty Limited has not received any other fees from the Company.

Steinepreis Paganin has acted as the solicitors to the Company in relation to the Offer, has prepared a Solicitor's Report on Tenements which has been included in Section 8 of this Prospectus and has been involved in due diligence enquiries on legal matters. The Company estimates it will pay Steinepreis Paganin \$25,000 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.

Geological and Management Services 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 Geological and Management Services Pty Ltd a total of \$20,000 for these services. During the 24 months preceding lodgement of this Prospectus with the ASIC, Geological and Management Services Pty Ltd has not received any other fees from the Company.

$10.6$ 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.

Horwarth (WA) Pty Limited 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. Horwarth (WA) Pty Limited has not withdrawn its consent prior to lodgement of this Prospectus with the ASIC.

Horwarth Audit (WA) Pty Ltd has given its written consent to being named the Company's Auditor in this Prospectus and 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.

Geological and Management Services Pty Ltd has given its 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. Geological and Management Services Pty Ltd has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

Computershare Investor Services Pty Limited has given and, as at the date hereof, has not withdrawn, its written consent to being named as Share Registrar in the form and context in which it is named. Computershare Investor Services Pty Limited has had no involvement in the preparation of any part of the Prospectus other than being named as Share Registrar to the Company. Computershare Investor Services Pty Limited has not authorised or caused the issue of, and expressly disclaims and takes no responsibility for, any part of the Prospectus.

$10.7₁$ Restricted Securities

ASX has indicated that certain existing security holders may be required to enter into agreements which restrict dealings in Shares held by them. These agreements will be entered into in accordance with the Listing Rules.

$10.8$ Expenses of the Offer

The total expenses of the Offer are estimated to be approximately \$250,000 and are expected to be applied towards the items set out in the table below:

Item of Expenditure	Amount (\$)
ASIC fees	\$2,010
ASX fees	\$25,000
Advisors' fees	\$52,500
Printing	\$10,000
Broker's fees	\$150,000
Miscellaneous	\$10,490
TOTAL	\$250,000

10.9 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.

$10.10$ 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.peelex.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 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.

$10.11$ 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.

$10.12$ Forecasts

Given the speculative nature of exploration, mineral development and production, there are significant uncertainties associated with forecasting future

revenue. On this basis, the Directors believe that reliable forecasts can not be prepared and accordingly have not included forecasts in this Prospectus.

$\overline{11}$ . 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.

.
Internetti kuningas

Michael Klernan For and on behalf of Peel Exploration Limited

$\overline{12}$ . GLOSSARY

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

$12.1$ Glossary of Technical Terms

Acid	An igneous rock having a higher percentage of silica than orthoclase.
Acid volcanics	Rocks of volcanic origin containing a high proportion of silica.
Acidic	Igneous rocks containing more than 60 per cent silica.
Actinolite	A complex calcium magnesium iron silicate mineral commonly occurring in metamorphic rocks.
Adamellite	A form of granitic rock with approximately equal proportions of orthoclase and plagioclase feldspar minerals.
Aeromagnetic survey	A survey made from the air, recording variations in the earth's magnetic field
Aeromagnetics	Results of an airborne recording survey magnetic characteristic of rocks.
Aggregate	Sand, gravel, or any clastic material.
Alluvial deposit	A mineral deposit consisting of recent surficial water-lain sediments.
Alluvial	Pertaining to sedimentary rocks of relatively young geological age deposited by a river system.
Alluvium	Gravel and sediment found along rivers and creeks.
Alteration	Change in the physical or chemical composition of a rock.
Alteration zone	Zone within which rock-forming minerals have been chemically changed.
Altered	Referring to physical or chemical change in a rock or mineral subsequent to its formation
Amphibolite	A metamorphic rock composed mainly of amphibole minerals.
Amphibolite facies	An intermediate level of metamorphism.
Andalusite	An hydrous alumino-silicate mineral characteristic of contact- metamorphosed argillaceous rocks.
Andesite	A volcanic rock of intermediate composition.
Anomalous	Having relatively high values which may be directly or indirectly tested to significant mineralisation.
Anomaly	Value higher or lower than the expected or norm.
Anticline	A fold structure in which the strata dip away from each other
Antimony	An element of metallic appearance and crystalline structure, tin-white in colour, hard and brittle.
Arenite	A sedimentary rock with a sandy texture.
Arsenopyrite	An iron arsenic sulphide mineral.
Augite	A dark pyroxene mineral.
Aureole	A term applied to the zone of contact metamorphosed rocks surrounding an intrusion.
Auriferous	Containing gold.
Baryte	barlum mineral, found geothermal A in veins and replacements and in modular masses.

Basalt	A dark coloured fine grained volcanic igneous rock.
Bedding	The arrangement of rock in beds or layers of varying thickness and character.
Biotite	A form of mica.
Bornite	A sulphide mineral of copper and iron.
Brecciated	Pertaining to rocks made up of highly angular course fragments formed by crushing, volcanism or sedimentary processes.
Caldera	A large inverted cone shaped depression formed by a volcanic explosion
Cambrian	A geological time classification in which the rocks are between 500 and 570 million years old.
Cambro-Ordovician	Geological period, corresponding to approximately 435 to 570 million years ago
Carbonaceous	Pertaining to rocks containing a substantial amount of carbon.
Carboniferous	A period in geological history from about 360 to 386 million years from the present
Chalcopyrite	A sulphide mineral of copper and iron.
Chert	A compact massive siliceous rock.
Cherty siltstone	A siltstone with high massive silica content
Clastics	Sediments derived from erosion of pre-existing rocks.
Clay	Earthy deposit of extremely fine texture which is usually plastic when wet.
Cleavage	Parting surface in a rock.
Complex	An ore is complex when it carries several metals difficult to extract.
Conformable	Same dip as the underlying strata
Conglomerate	Pertaining to sedimentary rocks consisting mainly of fragments greater than 2 mm in diameter.
Contact metamorphic	A rock in contact with an igneous body altered by the heat from the igneous body
Contact zone	Zone in the country rock surrounding an igneous intrusion.
Cordierite	Alumino-silicate mineral characteristics contact- Οf metamorphosed argillaceous rocks.
Costean	An exposure of bedrock made by removal of surface material in a trench.
Costeaning	Trenching for the purpose of sampling a mineral prospect.
Cretaceous	geological time classification in which the rocks are А between 65 and 135 million years from the present.
Cupriferous	A rock containing copper or an ore of copper
Deformation	Process by which rocks are folded or faulted.
Devonian	A geological time classification in which the rocks are between 362 and 413 million years old.
Diamictite	A sedimentary rock containing large fragments distributed through a much finer groundmass
Diorite	A granitoid rock composed essentially of homblende and feldspar.
Dyke	An elongate thin planar form of igneous intrusion.

Elongate	Lengthened structure.
Equigranular	An igneous rock made up of crystals essentially equal in size
Exhalative	Description of a chemical sediment found by the escape of volcanically-derived fluids onto the sea floor or into the sea.
Extrusion	Pertaining to igneous rocks ejected at the Earth's surface.
Facies	Characteristic of a rock unit which reflects the conditions of origin and differentiates the unit from adjacent units.
Fault	A fracture or fracture zone along which there has been displacement of two sides relative to one another parallel to the fracture.
Felsic	Descriptive of an igneous rock which is predominantly of light- coloured minerals (opposite of mafic).
Felsite	Fine-grained siliceous volcanic rock.
Felspar	A common rock-forming group of silicate minerals.
Ferruginous	Containing iron.
Formation	A unit in stratigraphy defining a successful of rocks of the same type.
Gabbro	Dark granular igneous rock.
Gossan	A ferruginous deposit commonly derived from the weathering of sulphide ores and often showing relict crystalline textures.
Gossanous	An outcrop with features of a gossan
Granite	Coarse grained igneous crystalline rock with a high silica content.
Granodiorite	An intermediate igneous rock occurring in the form of batholiths containing quartz and approximately equal proportions of orthoclase felspar and plagioclase felspar.
Greenschist	Metamorphic mineral assemblage typical of low grade regional metamorphism.
Greenschist facies	A low level of metamorphism characterised by development of green colouration in basic Igneous rocks.
Greywacke	Poorly sorted sandstone with a clay matrix.
Hornblende	A variety of the mineral amphibole.
Hypersthene	A complex iron/magnesium silicate mineral.
Igneous	Rocks formed by solidification from a molten state.
Inliers	An area or group of rocks surrounded by rocks of younger age.
Intrusion	A mass of igneous rock which, while molten, was forced into or between other rocks.
intrusive	A rock that has intruded previously existing rocks.
Jasper	Variety of chert coloured by iron oxide.
Jaspilites	A rock consisting essentially of red jasper and iron oxides in alternating bands. Similar to banded iron formations.
Jurassic	A geological time classification in which the rocks are between 135 and 192 million years old.
Lacustrine	Pertaining to strata deposited in a lake
Leucogranite
Lithic	Rocks formed from rock fragments derived from older rocks.
Lithic clastics	Sedimentary rock of sand size made up of fragments of other rocks

Lithologically	Pertaining to the type of rock.
Mafic	Igneous rocks with dark coloration due to high magnesium and iron content.
Marine	Pertaining to strata deposited in an ocean
Meta	Signifying that the rock name which follows has been altered in form, structure or composition by the metamorphic processes of heat and/or pressure.
Metabasalt	Fine grained volcanic rock containing plagioclase feldspar and mafic minerals that has been recrystallised by metamorphism.
Metamorphic	Rock which has changed its structure and properties through the effects of heat and pressure over time.
Metamorphosed	Altered by metamorphic processes.
Metamorphism	The process of solid state rock alteration in response to pronounced changes in temperature, pressure and chemical environment.
Molybdenite	A sulphide mineral of molybdenum.
Molybdenum	A metallic element of the chromium group, resembling iron in its white colour, malleability, difficult feasibility and its. capacity for forming steel-like alloys with carbon.
Monzogranite	A form of granite.
Monzonite	An intermediate intrusive rock with near equal proportions of orthoclase and plagioclase
Mudstone	Poorly stratified sediment consisting of clay and silt particles.
Muscovite	Hydrated potassium aluminium silicate mica.
Oolitic limestone	A limestone made up of spheroidal calcite deposits
Orthoconglomerate	A coarse conglomerate with little or no finer grained clasts in the matrix
Outcrop	Part of a rock formation which appears at the surface of the ground.
Permian	A period in geological history from about 286 to 248 million from the present.
Plugs	Inclination of the axis of folded structure.
Plutonic	Term applied to igneous rocks which have crystallised at great depth.
Plutons	A body of igneous rock that has formed beneath the surface of the earth by consolidation from magma.
Polymetallic	Containing more than one mineral
Porphyritic	A textural term for those rocks which have larger crystals set in a finer groundmass, which may be crystalline, glassy, or both.
Post tectonic	Pertaining to geological activity after a major event of folding and/or intrusion
Precambrian	All rocks formed before Cambrian time, greater than 570 million years old.
Prehnite	A complex hydroxide of calcium, aluminium and silica
Prehnite-pumpellyite facies	A form of low temperature regional metamorphism
Pumpellyite	A complex hydroxide of calcium, magnesium, aluminium and silica
Pyrite	A sulphide mineral of iron.

Pyroclastic	Fragmental deposits formed from the accumulation volcanic ejecta.
Quaternary	Period of time covering the last 2 to 3 million years.
Regressive marine	A sedimentary environment where the sea shore is receding over time
Sandstone	A sedimentary rock in which the fragments are between 1/16 mm and 2 mm in size.
Sediments	Rocks formed of particles deposited from suspension in water, wind or ice.
Serpentine	An ultrabasic rock consisting almost entirely of serpentine, a hydrous magnesium silicate mineral.
Serpentinite	Main alteration product of ultramafic rocks
Siltstone	A sedimentary rock in which the detrital fragments are between 1/256 mm and 1/16 mm in size.
Silurian	A geological time classification in which the rocks are between 413 and 445 million years old
Siluro-Devonian	An age at the boundary of the Silurian and Devonian time periods, approximately 400 millions years ago.
Slate	Fine grained sedimentary rock, usually altered under pressure, possessing well developed cleavage which may be parallel to bedding.
Sphalerite	A mineral, the principal ore of zinc.
Stibnite	Sulphide of antimony sometimes associated with gold mineralisation.
Stockworks	A three-dimensional network of veinlets.
Stratabound	Deposit confined to a single stratigraphical unit
Stratiform	Specific variety of stratabound deposit is conformable with the enclosing units.
Stratigraphic	Pertaining to rocks of a generally layered nature, in a geometric or time sense.
Subduction	Section of crust which has thrust under-overlying zones due to crustal movement.
Syngenetic	Said of a mineral deposit formed at the same time, and by the same processes, as the enclosing rocks.
Terrestrial	Pertaining to sedimentary rocks deposited in non-marine environments
Tonalite	A coarse-grained intrusive rock of intermediate composition.
Trondjhemites	A form of granite containing mainly quartz, oligoclase, and biotite.
Tuffaceous	Pertaining to rocks formed substantially by the accumulation of volcanic ash and dust.
Ultramafic	Descriptive of an igneous rock with very high magnesium and iron content.
Unconformably	Descriptive of rocks on either side of an unconformity.
Unconformity	A contact between rock strata at which a substantial break in the geologic record has occurred.
Volcaniclastic	Clastic sediments derived partially or substantially from volcanic rocks.
Volcanics	Pertaining to a rocks discharged from volcanic activity

$12.2$ Glossary of Defined Terms

AS or \$	Australian dollar.
Application Form	The application form accompanying this Prospectus relating to the Offer.
ASIC	Australian Securities & Investments Commission.
ASX	ASX Limited (ABN 98 008 624 691).
Board	The board of Directors as constituted from time to time.
Business Day	A week day when trading banks are ordinarily open for business in Perth, Western Australia.
Company or Peel Exploration	Peel Exploration Limited (ACN 119 343 734).
Closing Date	The closing date of the Offer as set out in Section 3.3.
Constitution	The constitution of the Company.
Corporations Act	The Corporations Act 2001 (Cth).
Directors	The directors of the Company at the date of this Prospectus.
Exposure Period	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.
Listing Rules	The official listing rules of ASX.
Offer	The offer of Shares pursuant to this Prospectus as outlined in Section 4.
Official List	The Official List of ASX.
Official Quotation	Official quotation by ASX in accordance with the Listing Rules.
Option	An option to subscribe for a Share subject to the terms and conditions set out in Section 10.2 of this Prospectus.
Prospectus	This prospectus.
Share	A fully paid ordinary share in the capital of the Company.
Share Registry	Computershare Investor Services Pty Limited.
Shareholder	A holder of Shares.
Tenements	Tenements set out in Part I of the Solicitor's Report on Tenements in Section 8 of this Prospectus.
WST	Western Standard Time, Perth, Western Australia.

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Peel Exploration Limited ACN 119 343 734
Application Form	Brokes Code	Adviser Code
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Applicant Marre(s) 翻畫

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Postal Address 薪清

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The Contact Details

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Poet Exploration Losined (the Company) will study to the ASD to publicipate in .
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Sefore completing the Application Form the applicant(s) should read this prospectus to which this application relates. By Indging the Application Form, the applicant our exceptible arrangements at engagement of the state of the light of the light of the largest the constitution of Pust Exploration in the largest and the Constitution of Pust Exploration in the l agrees to take any number of Shares that may be allotted to the Applicances pursuant to the propposits and declares that all details and statements made are complete and acourate. It is not necessary to sign the Application Form.

Lodgeniont of Application
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Openputershare investor Services Pty Lanked Lend 2.
46 St Georges Terume PERTH RA 6000

Privacy Statement

Personal information is entirely as the form be Commun retaintent interaction Pro Limitat ("CRP), as securities in seconders into an information of the insurant of the interaction of manishing requests of securitybolders, facidating databation payments and other corporate actions and communications. Your general information may be draincent or out niland bağnı copolin, ti bilindel novan omparks kub il şabi ormal karkı parldan, ol il sherans sipbol o persileb by ber Krul Krul Skoli baş gelek ol yap personst mixtures and by CM, we would the to sport of mixture that a macurale, monted or and of date, plasse applat CHS in secondarse with the Corporators act .
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Correct forms of registrable litle(s)

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Application Form

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	Cheque details - Make your cheque or bank draft payable to Peel Exploration Limited - Share Trust Account
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Contact Details 攌

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II CHESS

Poed Exploration Landed (the Company) will apply to the ASA is pattingate in OFEST, specified by ASX Suthmass and Tracular Corporation Ply Oul, a wholly suggest automatury of Australian Slock Swanger Leaded In OMESS Inc. Commerce and research are chosenable Controller Substrational of homester. istings and an example, takes duranteed (things at a security isitues. Togeber the two betweeking all note up be Onegany's precipit register of securives. The Constany will not be searing centrales In antifacts in respect of States Abdited. If you are a Civilidat confidential present and the substitution of the second continues with the rest to rest to rest to Trans store a you announced a primain on me CHESS Jidmgabe, dahi yan WAIA (B) (Panate), Tro ba batan kipak seed on selectings it, you will be spontanced by the Company work about their Encortatolist Resease Number (BRN)

Payment 臍

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Solve completing the Application Ferm the applicant(s) should read the prospectus to which the application relates. Sy ledging the Application Form, the applicant agrees that this suppleation for Shares in Poel Exploration Limbed is upon and subject to the lorms of the prospectus and the Ponstrument of Poel Exploration Limited. agrees to take any number of Bhares that may be afforced to the Applicanted pursuant to the prospectus and declares that all details and statements made are complete. and accurate. It is not necessary to sign the Application Perso.

Lodgement of Application

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Privacy Statement

Persons rimmates in collected on the locule by Computerizate investor Services PV Limited ("CRF), as regative its concerters summers ("the societ"), he the pospose of mvatsiin resten dovurkvoiden. Isokitist dentskat avmett om oter ontwak odem and ommeriation. You oeroval isbraakn nov to derivete to vu reduced to the company of the company states of the company of the company of the party of the company of the company of the company of the company of the company of the company of the company of the company of the company personsi exceeding tend by CSL or you would her to convect subsection tent or moderate, moderate or called dute, please contact CIS in accordance with the Cosportions Act .
2001, you may be west madend (mabdisy marketing material approved by the exuent a general comparations communications, You may also receive marketing. maning by complete CP, Yea can under CP, using the delight primal on the loat of the tenn of E-mail processiffecemental more and

I pas here any anguing comprehing your mythology, phrase contact the Computershow investor Services Diy Limited on 1380 664-983.

Correct forms of registrative fifte(s)

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