PRODIGY GOLD NL — Annual Report 2007

Sep 27, 2007

ABM RESOURCES NL AND CONTROLLED ENTITIES

ABN 58 009 127 020

ANNUAL REPORT

YEAR ENDED 30 JUNE 2007

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CORPORATE DIRECTORY

Directors	Mr Imants Kins –Executive Chairman
	Mr David Reynolds
	Mr Andrew Simpson
Secretary	Ms Jutta Zimmermann
Notice of Annual General Meeting	The annual general meeting of ABM Resources NL will be
	held at
	BDO Kendalls Audit & Assurance (WA)
	Level 8, 256 St Georges Terrace
	PERTH WA 6000
	at 10am
	on 20 November 2007
	A formal notice of meeting is distributed through the mail
	and available on the Company’s website
	www.abmresources.com.au by 19 October 2007
Auditors	BDO Kendalls Audit & Assurance (WA)
	128 Hay Street
	SUBIACO WA 6008
Bankers	Commonwealth Bank of Australia
	Head Office
	150 St Georges Terrace
	PERTH WA 6000
Share Registry	Security Transfer Registrars Pty Limited
	770 Canning Highway
	APPLECROSS WA 6153
	Telephone: +61 8 9315 2333
Solicitors	Steinepreis Paganin
	Level 4, Next Building
	16 Milligan Street
	PERTH WA 6000
Stock Exchange	Australian Securities Exchange Limited
	ASX Code: ABU
Registered Office	141 Broadway
	NEDLANDS WA 6009
Principle Office	141 Broadway
	NEDLANDS WA 6009
	Telephone: +61 8 9423 9777
	Fax: + 61 8 9423 9733
	Website: www.abmresources.com.au
	Email: admin@abmresources.com.au
Postal Address	141 Broadway
	NEDLANDS WA 6009

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES	ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES
CONTENTS PAGE NUMBERS
Executive Chairman’s report……………………………………………………………	1
Executive Chairman’s review of operations………..…………………….…………...	3
Summary of mining tenements and areas of interest………………………………..	10
Directors’ report…………………………………………………………………………..	12
Corporate governance statement………………………………………….….……….	24
Auditor’s independence declaration……………………………………….….……….	29
Income statements………………..……………………………………………….......	30
Balance sheet…………………………………………………………………………….	31
Statement of changes in equity……………………………………………….………..	32
Cash flow statement……………………………………………………………………..	34
Notes to the financial statements…………………………….………………………	35
Directors’ declaration…...……………………………………………………………….	68
Independent auditor’s report to the members………….……………………………..	69
Additional information for listed public companies……………………………………	71

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES EXECUTIVE CHAIRMAN’S REPORT

Dear Shareholder,

It has been a very active and positive year for the Company having built on the rationalisation of the exploration portfolio and corporate activities instituted in the 2005/06 year. The Company’s share price has increased from 5.4 cents to 16 cents. This has been possible with:

• A focused board and management

• New institutional shareholders

• Exploration drilling success at our flagship Volcanogenic Massive Sulphide (VMS) base metals project at Erayinia 150km south east of Kalgoorlie in Western Australia which hosts 25 drill targets

• Strategic alliance with Ayr Infrastructure Pty Ltd and its subsidiary Ayr Resources Africa Pty Ltd

• Laying the foundations for new project acquisitions/JV’s with the potential for major discoveries

The so called super cycle of demand for commodities is expected to continue for at least another 10-20 years driven to a large extent by the urbanisation and growth in China and India. This is not a boom as such, but a historic and epic transformation of the global economy due to the positive economic impact of the urbanisation of a combined 2.3 billion people.

In March 2007 we were successful in raising A$3.75M to fund exploration at Erayinia and at other projects and provide additional working capital. The improved cash position was further bolstered by A$750,000 with the sale of the Company’s interest in Accent Resources.

A detailed review of the tenement portfolio has resulted in a reduction of non core tenement holdings and a very significant reduction of exploration commitments to enable the Company to focus exploration on its core assets. In this process the Gascoyne tenements that were retained are subject to a farm-out with Altera Capital Limited.

To diversify the risk profile of the Company, a co-operative agreement was signed with Ayr Infrastructure and its subsidiary Ayr Resources Africa to secure and develop mineral projects in Africa with the objective of initially focusing on Mozambique and Zambia. Due diligence was being carried out on selected concessions in both countries that had evidence of either gold, copper or uranium mineralisation and which demonstrated the exploration prospectivity to yield major economic discoveries. Community development programs maybe associated with these projects.

In the midst of the growth and accelerated activity, the Company was deeply saddened by the sudden passing of its Chairman and Company Secretary Timothy King. In honour of Tim, the resource definition drilling prospect at Erayinia was re named King (E1).

The key strategic objectives and milestones for the next year include:

• Progressing the VMS project at Erayinia to its initial JORC-compliant resource at King (E1)

• Extend the resource definition drilling over additional drill targets in the 40km VMS zone of potential at Erayinia

• Leverage the Ayr Infrastructure/Ayr Resources Africa strategic alliance to grow the asset base with projects demonstrating the potential for major discoveries in Africa and continue to expand the Western Australian project portfolio.

I would like to sincerely thank the board and management for the superb work they have contributed to the growth of the Company and the ongoing support of our shareholders. The 2007/08 year bears all of the hallmarks of continuing the significant favourable transition of the Company.

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REPORT

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

1. Strategic Objectives

During the year the Board finalized the development of a strategic plan and a risk management plan, which will be reviewed on a regular ongoing basis.

ABM is a diversified mineral exploration company that aims to deliver accretion in shareholder value through successful exploration of prospective mineral tenements that have the potential to host major economic discoveries and the ultimate development of these ore bodies into production with the generation of positive cash flow.

The Company’s key specific objectives this year have been:

• Exploration of its base metal tenements with a focus on its Volcanogenic Massive Sulphide (VMS) project at Erayinia

• Exploration of its other base metal project located in the Gascoyne region of Western Australia

• Acquisition of additional prospective base metal tenements in Western Australia

• Development of strategic partnerships with overseas companies to support its projects in Western Australia and acquisition/JV of prospective mineral concessions in Zambia and Mozambique

• Developing a supportive shareholder base that can assist in providing funding to achieve these objectives

2. Profile of ABM

ABM Resources is a diversified resource exploration company with a portfolio of base metal projects in Western Australia. It has been, and will continue, conducting due diligence on projects in Mozambique (gold) and Zambia (copper, cobalt and uranium). The Company’s conceptual exploration framework is focused on making major economic mineral discoveries. ABM Resources has implemented a strategy to generate growing shareholder value.

Review of Operations

The primary exploration focus of ABM Resources NL (ABM) is its VMS base metal project at Erayinia located 150km south east of Kalgoorlie. This interest is held through a 70:30 Joint Venture with Great Gold Mines NL. The Erayinia Joint Venture project contains a 40km strike length of a highly prospective VMS zone of potential with 25 defined drill targets based on geophysical and geochemical data. Drilling results have been encouraging to date, with better intersections at the King (E1) prospect including 1 metre of 17.9% zinc and 1.6% lead and 2 metres at 9.7% zinc and 1.3% lead.

A resource definition drilling program is currently in progress at the most advanced target, King (E1) to follow up previous encouraging drill results. Results from the current RC and diamond drilling will feed into the resource definition report with the objective of delivering the Company’s initial JORC-compliant resource estimate by the end of 2007.

Additionally, ABM has commenced RC drilling at the northern section of the tenements, within the “Hook” area and at the magnetic anomaly target Calypso, which is within the Hook area. The magnetic anomaly target at Calypso is similar to, though much larger than the anomaly at King (E1). At Calypso there is evidence of leached sulphides and rock chip samples anomalous in copper and zinc. Several additional anomalies have also been identified by a recent aeromagnetic survey.

An airborne magnetometry survey was flown over the base metal prospect at Gascoyne and identified several anomalies partly coincident with previously discovered geochemical anomalies. A farm out agreement has been negotiated on these tenements.

Exploration programs will be undertaken when the tenements at Harbutt Range and Earaheedy have been granted.

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EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

A co-operative agreement was signed with Ayr Infrastructure to secure mineral prospects in Zambia and Mozambique. Due diligence, including field reconnaissance, has commenced on concessions of interest.

ABM participated in the formation of a company in Mozambique called Ayr Resources Mozambique with a 40% equity share, the other partners are Ayr Resources Africa (40%) and local Mozambiquen interests (20%).

Growth

• ABM’s focus on its VMS base metal project brings an exciting opportunity given the demand for zinc which is used mainly to galvanise steel. A lack of supply for zinc has seen prices increase significantly over the last few years.

• The International Lead and Zinc Study Group has estimated that global zinc demand is poised to jump almost 4% this year with a further 2.6% increase forecast in 2008. A major contributor to the escalating zinc prices is the growth in the Chinese economy. It is forecast that the demand for zinc in China could increase by more than 50% by 2010.

• An issue of 30 million shares at 12.5 cents in the March 2007 quarter generated gross proceeds of $3.75 million. This capital raising will provide the additional funds needed for ABM to take its VMS base metal project to the next level. ABM’s objective, subject to a targeted JORC-compliant resource being established by its resource definition drilling underway at the King (E1) prospect at Erayinia, is to be able to move into a pre feasibility study in 2008.

• The Company has signed a co-operative agreement with Ayr Infrastructure to identify and, where appropriate, secure mineral prospects in Zambia and Mozambique. This provides an exciting prospect for ABM to diversify its exploration operations into precious and other metals in areas that have

• prospectivity for major economic mineral discoveries and which contain drill ready targets, subject to further target definition. Ayr Infrastructure Pty Ltd possesses an extensive and successful operational track record in a number of African countries. The strategic alliance with AYR Infrastructure and its subsidiary Ayr Resources Africa provides ABM with the potential of accessing a number of resource project opportunities and enables ABM to apply its technical and project management expertise in the assessment and possible development of such projects.

• As part of the strategy to continue to build the exploration portfolio, ABM entered into an agreement with a prospecting group to identify and secure mineral tenements in Western Australia, primarily focusing on gold and base metals. Two tenements have been acquired through this agreement since the start of the new year and initial exploration (rock and soil sampling) has begun on one of these tenements.

Outlook

ABM Resources is in a positive position to add value to its portfolio of assets, through exploration and potential development of advanced resource projects.

3. Highlights of Achievement of the Past Year

• Discovery of a base metal mineralised zone at the Company’s initial target, the King (E1) prospect, at Erayinia.

• Accelerated drilling program at the King (E1) target.

• Commencement of resource definition drilling at the King (E1) VMS target after encouraging results from initial drilling.

• Identification of additional drill targets at Erayinia with geophysical and geochemical anomalies.

• Encouraging drilling results at a number of the 25 drill targets other than King (E1).

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

• Encouraging interpretations of detailed airborne magnetometry in the northern part of the Erayinia project, identified as the Hook area.

• Encouraging airborne magnetometry results (adjacent to previous geochemical anomalies) over its Gascoyne base metal prospect.

• Cooperative Agreement signed with Ayr Infrastructure (parent company of Ayr Resources Africa) to secure mineral concessions in Zambia (copper, cobalt and uranium) and Mozambique (initially gold).

4. Exploration Activities

Erayinia Base Metal Project

ABM has entered into a re-negotiated joint venture with Great Gold Mines NL whereby it can explore the properties of the Erayinia project for all minerals. Following the end of the financial year, ABM secured a 70% interest in the project. This entails the Company sole funding exploration activities until commencement of a feasibility study for a mining operation and meeting its required expenditure requirements. The Erayinia JV project comprises three exploration licences aggregating approximately 320km[2] (111 sub blocks) in the East Coolgardie mineral field and centred about 150km east southeast of Kalgoorlie, Western Australia.

The Erayinia project is targeting base metal mineralisation in an Archaean greenstone belt. This terrain has only sparse outcrop with most of the area being covered, in places over 100 metres deep, by tertiary littoral sediments and quaternary playa lake and aeolian sediments. The relatively narrow greenstone belt has been traced, through aerial magnetometry, for more than 40km of strike length within the project area.

Geochemical and petrographical studies carried out during the last year have confirmed that much of the belt consists of fine grained tuffaceous rocks intercalated with mafic and felsic volcanic igneous

components all of which were deposited in a sub-aqueous environment.

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During the year, the Company completed two detailed airborne magnetometry surveys (50 metre-spaced flight lines at nominal 60 metre flight height) which cover most of the

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

greenstone belt. From these data, it was confirmed as many as 25 discrete (“thumbprint”) anomalies occur in, roughly, the same stratigraphic position which was interpreted as near the margin of an elongate basin. Five of the anomalies have, to date, been tested by drilling:

• King (E1) prospect, at which the bulk of exploration has taken place

• E2 and E3 which are approximately 1½ -2km northeast of King (E1)

• E14 located about 10km north of King (E1), and

• E25 (Calypso) located about 30km north northeast of King (E1).

Assays from all of the above returned anomalous zinc within Archaean hydrothermally altered, sulphide-rich rocks.

In the past year, a further 40 RC holes, ten of which had diamond tails, were drilled at the King (E1) prospect. The drilling has covered 600 metres of strike length and the deepest sulphide-zone intersection has been yielded approximately 400 metres down-dip. The mineralised zone does not outcrop at surface apart from some siliceous-goethite rubble. However, the primary (sulphide) mineralisation, from about 25 metre depth, consists of a 1 to 6 metre wide zone of iron and zinc sulphides and magnetite contained in a banded, sericite-chlorite-epidote schist. Whilst the rocks have been subjected to metasometism and more than one phase of metamorphism, relict fabrics and immobile element assays imply a derivation from pyroclastic progenitors. The alteration mineral suite is typical of Archaean VMS deposits. The King (E1) prospect mineralisation encountered to date is not thick; its structure which is folded and dipping variably between 50° and 80° to the east, indicates significant post depositional deformation. However, the paucity of copper in the samples so far intersected whilst zinc and lead values remain relatively high (best assay 17.9% zinc, 1.6% lead and 296 g/t silver), suggests the zone so far drilled is distal from the source vent. A down-hole EM

survey may provide information as to the geometry or developmental extension of the sulphide body. Six core holes have been cased in preparation for this purpose and this work is expected to be completed in the first quarter of the 2007/08 financial year.

Erayinia – King (E1) Prospect Longitudinal Section

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The Company is extending its exploration to some of the other 25 thumbprint targets; preliminary drilling at Calypso (eight RC holes) has returned iron sulphides and anomalous zinc in chlorite-sericite-magnetite altered rocks. Airborne magnetometry was flown over a 40km[2] area designated the Hook zone which contains the Calypso prospect. A number of thumbprint anomalies where discovered in the Hook area, with Calypso being the largest and coincident with some siliceous ironstone outcrop. Other structures of interest for gold were also discovered and will be investigated in 2007/08. Calypso is located approximately 30km north of the King (E1) prospect. The E14 magnetic anomaly (10km north of King (E1)), is covered by more than 100 metres of poorly consolidated tertiary sands and muds which have made geochemical sampling difficult. However, two traverses of RC drilling (eight holes) have returned some siliceous-sulphidic sections reminiscent of the King (E1) prospect.

Research into the magnetic anomalies in order to prioritise exploration targeting is planned for the forthcoming year.

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

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Gascoyne

Through its wholly owned subsidiary, Rare Resources NL, the Company is the beneficial owner of the exploration licences covering 130 sub-blocks (approximately 375km[2] ) in the Gascoyne district, approximately 100km north of Gascoyne Junction. The licences cover high metamorphic grade sediments and granitoids of mid Proterozoic age. This region was explored in 2004 by BHP Billiton as part of a joint venture with the Company.

BHP Billiton had discovered gahnite (a zinc spinel which is often a “pathfinder” mineral to Broken Hill type mineralisation) in numerous locations in the district. Follow-up reconnaissance exploration identified a few lead-zinc-copper anomalies in soil and rock chip samples. A subsequent gravity survey did not reveal an anomaly to BHP Billiton’s satisfaction and the joint venture was terminated.

In this last year, the Company completed a detailed (100 metre spaced flight lines) airborne magnetic survey over 140km[2] area of the project. Preliminary interpretations indicate a domed sequence of sediments and possible mafic volcanic rocks with minor granitoid intrusions. Also present are discrete but stratigraphically controlled anomalies some of which are proximal to some of the previously mentioned rock chip/soil geochemical anomalies. Due to other exploration priorities, the Company has

negotiated a farm-out of some of its equity in this project.

Earaheedy and Harbutt Range

ABM has made application for two large exploration licence areas in the Earaheedy Basin and Paterson Orogen but the licences have not yet been granted.

The Earaheedy project is regarded as a “greenfields” play. The region is a large Proterozoic basin located about 1,000km northeast of Perth, comprising a sequence of clastic and carbonate-rich sediments. Base metal sulphides, albeit not of economic grade, have been found in some formations of the basin. In the area, on the Company’s tenements, past diamond exploration by other companies identified several copper anomalies. Kimberlite pipes have also been identified.

The Harbutt Range project (70 sub blocks) is located near the Canning Stock Route about 360km east of Newman and at the southeast end of the Paterson Orogen. Geological mapping by GSWA indicates about 25% rock exposure but most of the region is covered by younger sediments of the Officer Basin or quaternary continental aeolian sands. The Paterson Orogen (fold belt) is a zone of mid to late Proterozoic thrusts that strike approximately northwest and dip south westwards. Folded and metamorphosed granitic gneisses and minor amphibolites were overlain by “orthogenesis” (ex sediments) and then intruded by more granitoids. The geological package was subsequently overlain by late Proterozoic sediments that vary from coarse to fine grain and include some carbonate and sulphidic members. Base metals and uranium have been found in discrete formations in the northwest of the Orogen (Kintyre, Mt Cotton) and base metals are known to be associated with the Broadhurst Formation, remnants of which occur in the application area. Previous diamond exploration samples were found to be anomalous in copper. In the region, copper minerals have been recorded in quartz veins as well as carbonate

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

encrustations and will be the target of the Company’s exploration.

Partnerships

Preliminary discussions have been conducted and are continuing with a number of Chinese companies which have expressed an interest in a possible strategic partnership with ABM.

5. Project Portfolio

ABM has undertaken a review of the tenement holdings with the objective of with ABM. reducing the portfolio to focus on the strategic objectives of the Company. 7. Outlook for 2007 / 2008 A number of tenements were surrendered or sold and three tenements retained, at Gascoyne, have been farmed out.

The world is in the early stages of a historic long term transformation as 2.3 billion people in China, India and Eastern Europe rise from below the poverty level to become consumers and join the world economy. This is akin to the other historic societal transformations of the Industrial Revolution, the transformation of the United States of America beginning in the late 19[th] century (catalysts were transportation, communications and power generation) and the post second world war reconstruction / demographic change. The global workforce is estimated to have increased by an estimated 1 billion people over the last decade. With the urbanisation and industrialisation in China and India and the entry of the former Soviet Bloc into the world economy, investment in infrastructure and consumer demand have grown strongly. The USA consumer has maintained a strong long term trend of increasing consumption to create a market for the low cost manufactured goods that have been exported from China in particular.

Exploration of the Western Australian tenements acquired as base metal prospects will begin at Harbutt Range and Earaheedy once these tenements have been granted. Due diligence has commenced on a number of mineral concessions in Mozambique (gold) and Zambia (copper, cobalt and uranium) as part of a strategic expansion of the Company’s asset base of prospective mineral concessions that may have the potential for major discoveries.

6. Corporate Developments

Investors

A major change in the shareholder registry occurred with the result that the two largest shareholders of ABM are now overseas investment funds.

Directors

Andrew Simpson was appointed to the Board of ABM in May 2007. He has over 30 years experience in the minerals sector, is a board member of a number of ASX listed mining sector companies and has specialised knowledge in the marketing of minerals and governance of listed companies involved in the mining sector.

With inflation held in check for many years throughout the developed nations, world economies have experienced a golden period of growth. For example, in China alone, over 400 million people have risen above the poverty level since 1978. The growth in China has been so far mainly driven by direct foreign investment and exports. The growth is expected to be maintained as domestic demand of the 2.3 billion combined populations of China and India increases over the long term of the next 10 to 20 years. The World Bank has stated that over the next 13 years (i.e. to 2020), the global middle class is forecast to rise from 400 million to 1.2 billion.

Imants Kins became the Executive Chairman of ABM after the sudden and very sad passing away of the Chairman and Company Secretary, Timothy King.

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

EXECUTIVE CHAIRMAN’S REVIEW OF OPERATIONS

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This will drive growth in global consumer demand in areas such as housing, consumer goods, utilities, transport, food and leisure. The OECD studies show that per capita demand for metals and energy rises rapidly when per capita income enters the range of US$2,300 to US$5,800. The OECD notes that China has entered this range with per capita income in 2006 of US$2,450. If, as experts predict, China follows the same growth pattern as Japan, demand is expected to continue to grow for at least another decade. It is noted that in Japan, metals consumption is estimated to have only peaked at a per capita income of US$23,000.

The USA is forecast to continue to experience population growth and by 2050 its current population of 300 million is forecast by the UN prepared data (medium variant) to have risen to 402 million.

In summary, the simple drivers of continued growing demand for metals will be growing

global population, employment and income levels. It is unlikely that supply will be able to match demand, particularly as major discoveries of minerals become increasingly scarce. In such a scenario, the inherent value to the owners of quality mineral exploration projects in geologically favourable areas can be expected to increase. The existing trend of consolidation in the mining sector confirms this scenario.

The business cycle is not expected to have been curtailed and it can be expected that there will continue to be cyclical ups and downs in economic growth over the short term around the long term trend.

8. 2007 / 2008 Objectives

• Completion of initial JORC-compliant resource estimate at Erayinia

• Subject to JORC-compliant resource estimate, commence a pre feasibility study in 2008 at the King (E1) prospect

• Drilling at the Calypso Prospect

• Testing of other base metal targets at Erayinia including E14, E13 and E11

• Exploration of gold targets at Erayinia

• Acquisition and exploration at Mozambiquan and Zambian concessions, subject to favourable due diligence.

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES SUMMARY OF MINING TENEMENTS AND AREAS OF INTEREST

As at 30 June 2007

	Areas of Interest Tenements Economic Entity’s Interest Joint Venture Partners
	WESTERN AUSTRALIA Dalgaranga M59/106 100 M59/553 100 P59/1772 100 Formerly M59/554 P59/1773 100 Reversion of Part of M59/553 P59/1774 100 Formerly M59/554 P59/1775 100 Formerly M59/554 P59/1776 100 Formerly M59/554 P59/1777 100 Formerly M59/554
	Norseman L63/46 100 M63/172 100
	Binneringie M15/217 100 M15/468 100
	Mt Deans P63/758 100 P63/945 100 P63/946 100 P63/947 100 P63/948 100 P63/949 100 P63/950 100 M63/397 100 Formerly P63/740,741,758 M63/513 100 Formerly P63/945 – 950 M63/541 100 Formerly P63/1074,1075 P63/1350 100 Reversion of M63/397 P63/1351 100 Reversion of M63/397 P63/1352 100 Reversion of M63/397 P63/1353 100 Reversion of M63/513 P63/1354 100 Reversion of M63/513 P63/1355 100 Reversion of M63/513 P63/1356 100 Reversion of M63/513 P63/1357 100 Reversion of M63/513 P63/1358 100 Reversion of M63/513 P63/1359 100 Reversion of M63/541 *P63/1360 100 Reversion of M63/541
	Gascoyne M09/62 100 E09/1074 100 E09/1266 100

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

SUMMARY OF MINING TENEMENTS AND AREAS OF INTEREST

As at 30 June 2007

Areas of		Economic Entity’s
Interest	Tenements	Interest	Joint Venture Partners
Brockman	M80/509	0	Brockman Minerals Pty Ltd and
			Aztec Resources Limited (ABU
			earning 78%)
	P80/1631	0	Reversion of M80/509
	P80/1632	0	Reversion of M80/509
	P80/1633	0	Reversion of M80/509
	P80/1634	0	Reversion of M80/509
	P80/1635	0	Reversion of M80/509
	M80/510	0	Brockman Minerals Pty Ltd and
			Aztec Resources Limited (ABU
			earning 78%)
	P80/1626	0	Reversion of M80/510
	P80/1627	0	Reversion of M80/510
	P80/1628	0	Reversion of M80/510
	P80/1629	0	Reversion of M80/510
	P80/1630	0	Reversion of M80/510
Erayinia	E28/1228	51	Great Gold Mines NL (ABU
			earning up to 70%)
	E28/1611	51	Great Gold Mines NL entitled
			to up to 30%
	E28/1612	51	Great Gold Mines NL entitled
			to up to 30%
	E28/1645	100
	E28/1646	100
	E28/1682	100
Harbutt	E45/2923	100
Range
Earaheedy	E69/2290	100

• In process of sale to ABEH Pty Limited

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

DIRECTORS’ REPORT

Your directors present their report on the Company and its controlled entities for the financial year ended 30 June 2007.

Directors

The names of directors in office at any time during or since the end of the year are:

Mr Imants Gustavs Kins Mr Timothy John King Ceased 14 April 2007 Ms Sasya Ahmad Ceased 30 November 2006 Mr David Reynolds Mr Andrew Simpson Appointed 12 May 2007

Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.

Principal Activities

The principal activities of the economic entity during the financial year were:

• Annual review of ABM’s strategic plan;

• Research into new tenement acquisitions in Western Australia and Africa;

• Accelerated exploration at Erayinia base metals prospect;

• Geophysical survey of Gascoyne base metal prospect;

• Disposal of surplus assets (includes tenements);

• Capital raising;

• Development of business relationship with AYR Infrastructure resulting in a MOU and a cooperative agreement on a 50/50 basis, after allowing for local participation;

• Development of business relationships with various Chinese parties resulting in the signing of MOU’s;

• Re-negotiation of the Erayinia JV resulting in a new JVA;

• Due diligence and field reconnaissance on concessions in Zambia and Mozambique;

• Development of a humanitarian program for the African strategy in a “removal of mercury” project in Mozambique;

• Development of a new identity of the Company, reflecting the change in principal activities and the new management structure, resulting in a name change from Tantalum Australia to ABM Resources;

• Launch of a new webpage and;

• Reconstruction of the share register with the introduction of major overseas funds as long term sophisticated investors to the share register.

The following significant changes in the nature of the principal activities of the economic entity occurred during the financial year:

• Disposal of tantalite tenements in Western Australia;

• Move from solely base metals and uranium to a diversified resource exploration company that includes gold;

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

DIRECTORS’ REPORT

• Risk diversification by actively reviewing projects in Mozambique, Zambia and within Western Australia to procure high quality drill-ready projects to expand the exploration portfolio;

• Formation of a joint venture company in Mozambique on a 40/40/20 basis and;

• Development of partnerships to secure prospective mineral tenements/concessions in Africa and Australia.

There were no other significant changes in the nature of the economic entity’s principal activities during the financial year.

Operating Results

The consolidated loss of the economic entity after providing for income tax and eliminating minority equity interests amounted to $(2,934,564) (2006: loss of $(3,103,483)).

Dividends

There were no dividends paid or declared during the year.

Financial Position

The net assets of the economic entity have increased by $1,957,536 from 30 June 2006 to $6,154,149 in 2007. This increase has largely resulted from the following factors:

• proceeds from share issues raising $4,300,000 and

• non core asset disposals

The economic entity’s strong financial position has enabled the group to eliminate its borrowings while maintaining a healthy working capital ratio. The group’s working capital, being current assets less current liabilities, has improved from $2,490,014 in 2006 to $ 3,521,498 in 2007.

During the past financial year the group has sold surplus plant, equipment and financial assets to secure its long-term success. Strategic investments have been made in tenement acquisitions.

The directors believe the group is in a strong and stable financial position to expand and grow its current operations.

Significant Changes in the State of Affairs

The following significant changes in the state of affairs of the parent entity occurred during the financial year:

• (i) On 31 July 2006 the Company issued 6,500,000 ordinary shares at no consideration to key staff;

• (ii) On 3 August 2006 the Company moved premises to 141 Broadway in Nedlands, WA, 6009;

• (iii) On 17 August 2006 the Company changed its name from Tantalum Australia NL to ABM Resources NL;

• (iv) On 3 October 2006 the Company completed a share-buy-back of 500,000 ordinary shares;

• (v) On 3 November 2006 the Company issued 700,000 ordinary shares at no consideration to key staff;

• (vi) On 14 November 2006 the Company launched its new website at www.abmresources.com.au;

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• (vii) On 30 November 2006 non-executive director Sasya Sebi ceased to be a director;

• (viii) On 13 December 2006 the Company announced the signing of a new JV agreement with Great Gold Mines;

• (ix) On 15 December 2006 the Company issued 10,000,000 shares at 5.5 cents as a placement to provide exploration funds for Erayinia and additional working capital;

• (x) On 12 January 2007 the Company issued 800,000 ordinary shares at no consideration to key staff;

• (xi) On 12 January 2007 the Company signed an MOU with Ayr Resources Africa;

• (xii) On 22 March 2007 the Company issued 30,000,000 shares at 12.5 cents as a placement to provide exploration funds for Erayinia and additional working capital;

• (xiii) On 3 April 2007 the Company finalised the sale of its Accent Resources holding and ceased to be a substantial share holder;

• (xiv) On 16 April 2007 the Company announced the sudden passing of Chairman and Company Secretary Timothy King;

• (xv) On 17 April 2007 the Company announced the appointment of Imants Kins as Executive Chairman and Jutta Zimmermann as Company Secretary;

• (xvi) On 8 May 2007 the Company signed a co-operative agreement with Ayr Infrastructure Pty Limited;

• (xvii) On 14 May 2007 the Board appointed Andrew Simpson as non-executive director of the Company;

• (xviii) Negotiations in progress on the acquisition of mineral concessions in Mozambique and Zambia;

• (xix) Negotiations in progress with various Chinese parties on developing strategic partnership interests;

• (xx) Acceleration of Erayinia exploration program;

• (xxi) Significant changes in the share register with Kemet Tantalum Pty Limited and ABB Nominees exiting the register and sophisticated overseas funds entering the register;

• (xxii) Establishment of a local Mozambiquen Company at a 40/40/20 equity in June 2007.

Changes in controlled entities and divisions:

• (i) On 17 August 2006 Tantalum Australia Operations Pty Limited changed its name to ABM Resources Operations Pty Limited;

• (ii) Sale of the ABM Resources Operations Pty Limited’s crushing plant at Dalgaranga.

After Balance Date Events

Since 30 June 2007 ABM Resources NL has:

• Advised its JV Partner Great Gold Mines NL that it has met its expenditure requirements to secure 70% of interest in the Erayinia JV;

• Sold the Binneringie and Mt Deans tenements;

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• MOU signed with Kunlun International in regards to future cooperation on exploration and development of mineral projects.

• Entered a Partnership Agreement with a party to identify prospective mineral tenements in Western Australia. Two tenements have been acquired through this agreement since the start of the new year and initial exploration has begun on one of these tenements;

• Executed the dissolution the 100% owned subsidiary Broad Arrow Mill Pty Ltd;

• Conducted a Review of the Brockman JV with Mt Gibson Iron Limited;

• Conducted a review of the Dalgaranga prospecting licenses for disposal to a third party or via another avenue;

• Signed a farm in agreement with Altera Capital Limited on the three Gascoyne tenements.

Future Developments

To further improve the economic entity’s performance and maximise shareholder wealth, the following developments are intended to be implemented in the near future:

• (i) Develop relationships with key players in the global financial and mining industry with a view to promoting and maximising the value of the activities of ABM Resources NL.

• (ii) Continue to seek, secure and explore new acquisitions in Zambia, Mozambique and Western Australia.

• (iii) Continue drilling at Erayinia with the objective of establishing an initial JORC-compliant resource estimate at King (E1) at Erayinia base metal prospect.

These developments, together with the current strategy of continuous improvement are expected to assist in the achievement of the economic entity’s long-term goals and development of new business opportunities.

Further information on likely developments in the operations of the Group and the expected results of operations have not been included in this annual financial report because the directors believe it would be likely to result in unreasonable prejudice to the economic entity.

Environmental Issues

The economic entity’s operations are subject to significant environmental regulation under the law of the Commonwealth and State. The economic entity monitors its compliance with environmental regulations on an ongoing basis. The directors are not aware of any significant breaches during the period covered by this report.

Information on Directors

The relevant qualifications and experience of the economic entity’s directors are set out in the following table:

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DIRECTORS’ REPORT

Name Position Qualifications and Experience Mr I Kins Executive Mr Kins is currently Executive Chairman of ABM Resources Chairman NL. Mr Kins is an Economist with over 25 years experience specialising in the resource sector. He has a Bachelor of Economics from the University of WA and a Master of Arts (Futures studies) degree from the Curtin University of Technology. Mr Kins has worked in the State Government (including industrial and resource development) and then mainly the private sector with an emphasis on the resource sector. Since 1987 he has mainly worked in the private sector as a consultant to the resource sector undertaking projects with exploration and mining companies, investors and brokers. In this regard he has undertaken consulting work with Australasian Gold Mines, Tantalum Australia NL and Gindalbie Resources. He was appointed the Managing Director of the Company in October 2005 and appointed Executive Chairman on 17 April 2007. Directorships in other listed entities – none. Mr D Reynolds Non-Executive Mr Reynolds is Managing Director of KEMET Suzhou, Director China. He has spent over 33 years working in various positions at Union Carbide and KEMET including Engineering and Manufacturing at various tantalum locations. He has been working directly with tantalum raw material since 1995 and has been a member of T.I.C. (Tantalum-Niobium International Study Centre) Executive Committee since 2001. He has a BS degree from the University of South Carolina. Directorships in other listed entities – none. Mr A Simpson Non-Executive Mr Simpson is a senior marketing executive with extensive Director global marketing experience in the resource and mining industry, including more than 30 years of international marketing and distribution of minerals and metals. He is currently managing director of Resource & Technology Marketing Services Limited, a company providing specialist marketing and business assessment advisory services to the mineral resources and technology industries, both in Australia and internationally. Mr Simpson is also nonexecutive Chairman of Swick Mining Services Limited, and non-executive director of Vital Metals Limited, India Resources Limited, Precious Metals Australia Limited and Territory Resources Limited. He is a member of the Australian Institute of Company Directors.

Mr A Simpson

Directorship in other listed entities – Consolidated Minerals Limited (September 2005 to July 2007), Swick Mining Services Limited (since 24/10/06), Vital Metals Limited (since 22/04/05), India Resources Limited (since 21/08/06), Precious Metals Australia Limited (since 20/06/07) and Territory Resources Limited (since September 2007).

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Company Secretary

The following person held the position of Company Secretary at the end of the financial year:

Ms Jutta Zimmermann: Ms Zimmermann assisted Mr Timothy John King, previously in his role as Company Secretary, and has stepped into his role after his passing. She is an accountant (Australian AQF diploma level) with over 20 years of experience (Germany and Australia) in accounting, taxation and, in recent years, management. She has a diploma in information technology (Australian bachelor degree level) from the Furtwangen Polytechnic and holds the position of Chief Financial Officer with the Company. Ms Zimmermann was appointed Company Secretary on 17 April 2007.

The Board considers that the economic entity is not yet of a size to warrant creating a separate audit committee.

Directors’ Interests

As at the date of this report, the direct and indirect interests of the Directors in the Economic entity were:

	Fully Paid Ordinary Shares
Imants Kins	9,473,000
David Reynolds	0
Andrew Simpson	100,000

Meetings of Directors

During the financial year, six meetings of directors were held. Attendances by each director during the year were as follows:

	Number Eligible to Attend	Board Meetings Attended
Mr I Kins	6	6
Mr T King	5	5
Mr D Reynolds	6	6
Ms S Ahmad	2	2
Mr A Simpson	1	1

Due to the current size and composition of the economic entities board, the full board deals with all board related matters rather than delegating responsibilities to board committees.

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REMUNERATION REPORT

This report details the nature and amount of remuneration for each director of ABM Resources NL, and for the executives receiving the highest remuneration.

Remuneration Policy

The remuneration policy of ABM Resources NL has been designed to align director and executive objectives with shareholder and business objectives by providing a fixed remuneration component, offering specific long-term incentives, and where appropriate short term bonuses, based on key performance areas affecting the economic entity’s strategic objectives and financial results. The board of ABM Resources NL believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the economic entity, as well as create goal congruence between directors, executives and shareholders.

The board’s policy for determining the nature and amount of remuneration for board members and senior executives of the economic entity is as follows:

• The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed by the board.

• All executives receive a base salary (which is based on factors such as qualifications, length of service and experience), superannuation, fringe benefits, and performance bonuses/incentives.

• The board reviews executive packages annually by reference to the economic entity’s performance, and the executive’s performance.

The performance of executives is measured against criteria agreed annually with each executive, including where appropriate, the growth in shareholders’ value. All cash bonuses and equity incentives must be linked to predetermined performance criteria. The board may, however, exercise its discretion in relation to approving bonuses and incentives, including equity participation. Any changes must be justified by reference to performance criteria considered appropriate by the board. The policy is designed to attract the highest calibre of executives and reward them for performance that results in long-term growth in shareholder wealth.

Executives are also entitled to participate in the employee share arrangements.

The executive directors and executives receive a superannuation guarantee contribution required by the government, which is currently 9%, and do not receive any other retirement benefits. Some individuals, however, have chosen to sacrifice part of their salary to increase payments towards superannuation.

All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Shares given to directors and executives are valued as the difference between the market price of those shares and the amount paid by the director or executive.

The board policy is to remunerate non-executive directors at market rates for time, commitment and responsibilities. The board determines payments to the non-executive directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees that can be paid to non-executive directors are subject to approval by shareholders at the Annual General Meeting. Fees for non-executive directors are not linked to the performance of the economic entity. However, to align directors’ interests with shareholder interests, the directors are encouraged to hold shares in the economic entity and, in appropriate circumstances where shareholder approval is obtained, should be granted incentive shares.

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The board has considered the advice of an independent remuneration consultant to ensure nonexecutive directors’ fees, executive directors’ fees and executives salaries and payments are appropriate and in line with the market. The independent remuneration consultant has based his recommendations on comparative roles and comparative companies in the external market.

Performance Based Remuneration

As part of each executive director and key executive’s remuneration package there is a performance-based component, consisting of cash bonuses and/or incentives, including equity participation, linked to the achievement of key performance indicators (KPIs). The intention of this program is to facilitate goal congruence between directors/executives with that of the business and shareholders. The KPIs are set annually, with a certain level of consultation with directors/executives to ensure buy-in. The measures are specifically tailored to the areas each director/executive is involved in and has a level of control over. The KPIs target areas, the board believes, hold greater potential for group expansion and profit, covering financial and non-financial as well as short- and long-term goals. Such incentives are offered where executive directors and executives do not otherwise have a substantial shareholding in the economic entity.

Performance in relation to the KPIs is assessed annually, with bonuses and incentives being awarded depending on the number and deemed difficulty of the KPIs achieved. Following the assessment, the KPIs are reviewed by the board in light of the desired and actual outcomes, and their efficiency is assessed in relation to the economic entity’s goals and shareholder wealth, before the KPIs are set for the following year.

Company Performance, Shareholder Wealth and Directors’ and Executives’ Remuneration

The remuneration policy has been tailored to increase goal congruence between shareholders, directors and executives. The policy provides for two methods to be applied in achieving this aim, the first being a performance based bonus based on key performance indicators, and the second being the issue of shares to the majority of directors and executives to encourage the alignment of personal and shareholder interests. The Company believes this policy to have been effective in increasing shareholder wealth over the past year.

The following table shows the gross revenue, losses and dividends for the last five years for the listed entity, as well as the share price at the end of the respective financial years. The improvement in the Company’s performance during the last year has been reflected in the Company’s share price. The board is of the opinion that these results can be attributed to the greater focus of the Company on specific prospective projects, reductions to the cost structure and exploration success. The board is satisfied that the previously described remuneration policy has been an important component of this improvement, and has lead to increased shareholder wealth within the last year.

	2003	2004	2005	2006	2007
	$	$	$	$	$
Revenue	2,264,420	522,600	560,507	290,319	177,860
Net Loss	4,630,934	2,987,102	4,375,121	3,103,483	2,934,564
Share Price at year-end	0.074	0.061	0.014	0.054	0.16
Dividends Paid	0	0	0	0	0

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DIRECTORS’ REPORT

Details of Remuneration for Year Ended 30 June 2007

The remuneration for each director and each of the three executive officers of the consolidated entity receiving the highest remuneration during the year was as follows.

The key management personnel of ABM Resources NL includes the directors as per page 16 and the following executive officers who have authority and responsibility for planning, directing and controlling activities of the economic entity:

• P Heydon Operations Manager

• B Rees Geological Consultant Manager, previously a long term employee of the Company

• J Zimmermann Company Secretary and Chief Financial Officer

Directors Imants Kins Timothy J King Sasya Ahmad David Reynolds Andrew Simpson	Salary, Fees and Commissions Superannuation Contribution Share- based payment - shares Total Performance Related Non Performance Related* $ $ $ $ % % 209,391 26,571 154,000 389,962 34.49 65.51 50,000 - - 50,000 - 100 7,500 - - 7,500 - 100 20,480 - - 20,480 - 100 4,502 405 - 4,907 - 100 291,873 26,976 154,000 472,849

• release of shares issued under escrow in the financial year ending 30 June 2007 and shares issued without holding lock

Specified Executives Peter Heydon Jutta Zimmermann Barry Rees	Salary, Fees and Commissions Superannuation Contribution Share- based payment - shares Total Performance related Non Performance related* $ $ $ $ % % 126,879 11,419 6,000 144,298 4.16 95.84 107,553 9,228 3,000 119,781 2.50 97.50 97,300 - 20,800 118,100 17.61 82.39 331,732 20,647 29,800 382,179

• release of shares issued under escrow in the financial year ending 30 June 2007 and shares issued without holding lock

Performance Income as a Proportion of Total Remuneration

Executive directors and executives are paid performance based bonuses linked to goals set having regard to experience, qualifications and length of service, rather than being linked to proportions of their salary. This has led to the proportions of remuneration related performance varying between individuals. The board has set these bonuses to encourage achievement of specific goals that have been given a high level of importance in relation to the future growth and profitability of the

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economic entity, and to retain key personnel. The board has considered the advice of an independent remuneration consultant to ensure share allocations are appropriate and in line with the market. The independent remuneration consultant has based his recommendations on comparative roles and comparative companies in the external market. The board will review the performance bonuses to gauge their effectiveness against achievement of the set goals, and adjust future year incentives as they see fit to ensure use of the most cost effective and efficient methods.

Options and Shares Issued as Part of Remuneration for the Year Ended 30 June 2007

No options were issued to directors and executives as part of their remuneration.

During the year ended 30 June 2007 the following shares of ABM Resources NL were issued to directors and specified executives under the ABM Resources NL Share Plan for no consideration. 500,000 shares have been bought back from Alan Still with the buy back being completed in October 2006.

er 2006.
Grant Date	Director / Specified	Share Price at Issue	Number of Shares
	Executive	Date	Issued
31-07-06	Imants Kins	0.044	6,500,000
03-11-06	Jutta Zimmermann	0.05	400,000
12-01-07	Barry Rees	0.105	800,000

Some of the shares are issued with a holding lock until such time as the directors resolve that continuity and performance conditions have been met.

Employment Contracts of Directors and Senior Executives

Remuneration and other terms of engagement for non-executive directors are formalised in service agreements and this process has been completed in August 2007. The agreement summarises the board policies and terms, including compensation relevant to the office of director.

The employment conditions of the Executive Chairman, Mr Kins, the executive director and specified executives are formalised in contracts of employment. Each of these contracts provide for equity based incentives, subject to KPI’s specified in the contract of employment, and other benefits including participation in salary packaging options. With the exception of the Executive Chairman in certain specified circumstances, share incentives in respect of which the performance and/or employment continuity conditions have not been satisfied, become eligible for buy back by the Company for nominal consideration.

The employment contracts stipulate a range of one- to three-month resignation notification periods. The Company may terminate an employment contract without cause by providing a range of oneto three-month written notice or making payment in lieu of notice, based on the individual’s annual salary component. No redundancy payments are offered to specified executives. In the instance of serious misconduct the Company can terminate employment at any time.

Other major provisions of the agreements relating to remuneration are set out below: I Kins, Executive Chairman

• Term of Agreement – 3 years commencing 1 October 2005

• Base Salary, inclusive of superannuation, for the year ended 30 June 2007 of $235,962, to be reviewed annually by the remuneration committee

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• Payment of a termination benefit on early termination by the Company, other than for gross misconduct, equal to the base salary for the remaining term of the agreement

J Zimmermann, Chief Financial Officer and Company Secretary (from 17 April 2007)

• Term of Agreement – ongoing commencing 1 June 2005

• Base Salary, inclusive of superannuation, for the year ended 30 June 2007 of $116,781, to be reviewed annually by the remuneration committee

P Heydon, Operations Manager

• Term of Agreement – ongoing initial contract commencing 21 February 2001

• Base Salary, inclusive of superannuation, for the year ended 30 June 2007 of $138,298, to be reviewed annually by the remuneration committee

B Rees, Geological Consultant Manager (previously a long term employee of the Company)

• Term of Agreement – ongoing commencing 12 June 2006

• Daily rate with no superannuation applicable, total remuneration for the year ended 30 June 2007 of $97,300

Indemnifying Officers or Auditor

During the financial year, ABM Resources NL paid a premium of $21,746 to insure the directors, secretaries and other officers of the Company and its Australian-based controlled entities.

The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against the officers in their capacity as officers of entities in the Group, and any other payments arising from liabilities incurred by the officers in connection with such proceedings. This does not include such liabilities that arise from conduct involving a wilful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage for themselves or someone else or to cause detriment to the Company. It is not possible to apportion the premium between amounts relating to the insurance against legal costs and those relating to other liabilities.

Options

The parent entity or controlled entities have not granted options over unissued shares or interest during or since the financial year to directors or any of the five most highly remunerated officers as part of their remuneration.

Proceedings on Behalf of the Company

No person has applied for leave of Court to bring proceedings on behalf of the parent entity or intervene in any proceedings to which the parent entity is a party for the purpose of taking responsibility on behalf of the parent entity for all or any part of those proceedings.

The parent entity was not a party to any such proceedings during the year.

Non-Audit Services

The board of directors is satisfied that the provision of non-audit services during the year is compatible with the general standard of independence for auditors imposed by the Corporations

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Act 2001. The directors are satisfied that the services disclosed below did not compromise the external auditor’s independence for the following reasons:

• all non-audit services are reviewed and approved by the board prior to commencement to ensure they do not adversely affect the integrity and objectivity of the auditor; and

• the nature of the services provided do not compromise the general principles relating to auditor independence as set out in the Institute of Chartered Accountants in Australia and CPA Australia’s Professional Statement F1: Professional Independence

No fees for non-audit services were paid / payable to the external auditors during the year ended 30 June 2007.

Auditor’s Independence Declaration

The lead auditor’s independence declaration for the year ended 30 June 2007 has been received and can be found on page 29 of the directors’ report.

Signed in accordance with a resolution of the Board of Directors.

==> picture [95 x 60] intentionally omitted <==

Imants Kins Executive Chairman Dated this 27[th] day of September 2007

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CORPORATE GOVERNANCE STATEMENT

The Board of Directors of ABM Resource NL (“ABM Resources” or “Company”) is responsible for the corporate governance of the economic entity. The board guides and monitors the business activities of ABM on behalf of the shareholders by whom they are elected and to whom they are accountable. Full details of the Company’s corporate governance policies and procedures have been made publicly available on the Company’s web site at www.abmresources.com.au.

Set out below is a summary of the Company’s corporate governance practices that have been adopted with reference to the ASX Corporate Governance Council’s 10 essential corporate governance principles and 28 recommendations for best practice in corporate governance.

Due to the current size and activities of the Company, the board has resolved not to adopt some of the best practice recommendations at this stage. In addition, the process of formally documenting and implementing policies and procedures relating to some of the best practice recommendations is still continuing. Where the Company has resolved not to comply or is not currently complying with a particular recommendation, the reasons for this are also detailed below.

Lay Solid Foundations for Management and Oversight (Principle 1)

The Company has adopted a formal Board Charter that sets out the role and responsibilities of the

board and those delegated to senior management.

The board is responsible for determining and monitoring the objectives and strategic direction of the Company. The senior management are responsible for the efficient and effective operation of the Company in accordance with the objectives and strategies determined by the board.

Structure the Board to Add Value (Principle 2)

Board Composition

The Company’s current board consists of three members, being the Executive Chairman – Mr Imants Kins (who replaced Mr Timothy King as Chairman on 17 May 2007), and two NonExecutive Directors – Mr David Reynolds and Mr Andrew Simpson.

The relevant qualifications and experience of the Company’s directors are set out in the Directors’

Report.

Independent Directors

Best Practice Recommendations 2.1 and 2.2 recommend respectively that a majority of the board should be independent directors and the chairperson should be an independent director. Due to the sudden death of the previous Chairman and for practical reasons the Chair is currently held by an Executive (dependent) Director.

ABM Resources is a resource exploration company. As a resource exploration company some of the directors (including their associates) have taken / might take large equity risk positions to provide funding support, particularly at difficult times in the equity markets and director’s emoluments are reviewed regularly by an independent contractor based on data available from similar sized and performing companies. This has assisted in providing confidence to investors as to the focus and commitment of the board to achieve its objectives. Consultancy arrangements with directors on an as needed basis have also assisted the Company to access required skills, but keep the cost structure flexible and competitive.

The need for access to supporting equity and skills as required, and a flexible cost structure have been greater imperatives for ABM Resources as an exploration company, than the largely mutually exclusive concept of independence, which is much more relevant to larger corporations with

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CORPORATE GOVERNANCE STATEMENT

substantial workforces. Currently both Non Executive Directors are regarded as independent directors.

Complete compliance with the best practice in this area is not considered a current imperative, due to the additional direct cost of employing such directors, the view that there would not be an increase in board skills (only independence), and the risk that inefficiency will occur in the board decision making process whilst the independent directors become familiar with the Company’s business.

The roles of Chairman and Managing Director within the Company are carried out by the Executive Chairman (i.e. the same person). The roles and responsibilities are set out in the Company’s Board Charter.

Board Nomination Committees

Best practice Recommendation 2.4 recommends that the board should establish a nomination committee to assess the necessary competencies of board members, review board succession plans, evaluate the board’s performance and make recommendations for the appointment and removal of board members. However due to the current size and composition of the Company’s board, the full board will be responsible for the above duties.

Appointment of Directors

The Board Charter sets out the Company’s policy for the appointment of directors.

Directors are appointed under the terms of the Company’s constitution. Appointments to the board are based upon merit and against criteria that serves to maintain an appropriate balance of skills, expertise and experience on the board in the context of the current stage of development of the Company. The categories considered necessary for this purpose are a blend of finance, business, management (including strategic planning) industry knowledge and administration skills. As the Company develops from explorer to producer the skill mix of the board will be reviewed accordingly.

Directors are to be appointed pursuant to formal agreements. The expectations for time to be committed to attend board meetings and participate in committees and other activities of the Company should be set out in writing.

An induction pack should be provided to all new directors, which includes information in relation to the Company’s operations, structure, constituent documents, financial position and strategic and business plans.

Independent Professional Advice

If a director considers it necessary to obtain independent professional advice to properly discharge their responsibilities as a director of the Company then, provided the director first obtains approval for incurring such expense from the Executive Chairman, the Company will pay the reasonable expenses associated with obtaining such advice.

- Promote Ethical and Responsible Decision Making (Principle 3)

The Company has adopted a formal Code of Conduct for Company Directors and Senior Executives.

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CORPORATE GOVERNANCE STATEMENT

The Code of Conduct requires directors and senior executives to act in the best interests of the Company and to promote and exercise the highest standards of ethics and integrity at all times in performing their duties for the Company.

The Company has also formally adopted a Share Trading Policy. The Share Trading Policy sets out when trading in the Company’s shares is permitted by directors, senior managers, employees and related parties and sets out procedures to limit the risk of insider trading.

Safeguard Integrity in Financial Reporting (Principle 4)

As a mineral exploration company, the Company provides a report on its activities to the ASX at the end of each quarter. In addition the Company provides a copy of its audited half year and full year financial accounts to the ASX and ASIC.

Internal Sign Off

Prior to signing off the half year and full year financial accounts and approving them for release to the market, the board requires the Executive Chairman and the Chief Financial Officer to state in writing to the board that the financial accounts present a true and fair view, in all material respects, of the Company’s financial position and operational results and are in accordance with relevant accounting standards.

Audit Committee

Best practice recommendations 4.2, 4.3 and 4.4 recommend that the board should establish an audit committee, consisting of independent, non-executive directors and adopt a formal charter setting out the committee’s role and responsibilities.

As mentioned above with respect to a board nomination committee, due to the current size and composition of the Company’s board, the full board will be responsible for the duties that would be assigned to an audit committee. The relevant duties are set out in the Company’s Board Charter.

Appointment of External Auditor

The board is responsible for selecting and appointing the Company’s external auditor. The board is also responsible for monitoring and reviewing the independence and quality of the audit services provided.

Where it is determined that a new auditor is to be appointed, and / or a tender process undertaken for the audit, the board has identified the following criteria for determination of the preferred auditor:

• Value for money taking into account cost and quality of service;

• Independence of Auditors taking into account other work that may be required of the firm;

• The matters set out in auditor independence guidelines;

• Seniority of Audit staff to be appointed to the Company’s engagement;

• Board being satisfied as to the intended scope of work to be undertaken as part of the audit process;

• Background and experience of the audit firm with the Company and the industry in which it operates and number of companies of similar size that the firm audits and;

• Reputation and standing of the audit firm in the business community.

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CORPORATE GOVERNANCE STATEMENT

Make Timely and Balanced Disclosure (Principle 5)

The Company’s shares are listed on the ASX and as such the Company is required to comply with the continuous disclosure requirements set out in the ASX Listing Rules.

In order to ensure that the Company meets its obligations with regard to the continuous disclosure requirements, the Company has adopted a Continuous Disclosure Policy.

The Continuous Disclosure Policy sets out the Company’s obligations and its policies and procedures to ensure timely and accurate disclosure of price sensitive information to the market.

Respect the Rights of Shareholders (Principle 6)

The Company endeavours to provide shareholders with important information on the Company in a timely and efficient manner. The Company promotes direct communication with shareholders and encourages them to direct questions or requests for further information to the Executive Chairman, Company Secretary or the board.

The Company has adopted a Shareholder Communication Policy to formalise its practices in this regard.

In addition to direct mailing of information to shareholders, the Company posts up to date information on the Company’s activities together with copies of all information released to the ASX on its web site.

Shareholder meetings are an important forum for investors to meet with the board and senior management and discuss matters concerning the Company.

The Company’s external auditor attends all annual general meetings of the Company and is available to answer shareholder questions regarding the conduct of the audit and the preparation and content of the auditor’s report.

Recognise and Manage Risk (Principle 7)

The Company’s board is responsible for ensuring that appropriate policies and procedures are in place to identify and manage risks throughout the Company. The Company currently has a range of risk management policies and procedures in place. However as part of the Company’s review of its corporate governance practices, the board has formulated guidelines and is preparing a formal Risk Management Policy (RMP) and Framework for the Company. A workshop, using a trained facilitator, was conducted and a draft RMP was completed in August 2007. A final RMP will be completed by the end of September 2007.

As part of the ongoing monitoring of the Company’s risk management policies, the board requires the Executive Chairman and the Chief Financial Officer to state to the board in writing when presenting the half and full year financial statements that, to the best of their knowledge, the integrity of the financial statements is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the board, and that the Company’s risk management and internal compliance and control system is operating efficiently and effectively in all material respects.

Encourage Enhanced Performance (Principle 8)

The board is responsible for reviewing its performance and that of its individual directors, committees (where appointed) and senior management.

27

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CORPORATE GOVERNANCE STATEMENT

A formal review is conducted on an annual basis. The board determines the scope and detailed procedures for assessing performance against both measurable and qualitative indicators.

Individual directors are expected to continually monitor and review their own performance and undertake ongoing education to ensure they have sufficient time, information, knowledge and skills to effectively discharge their duties and responsibilities to the Company.

The Executive Chairman is responsible for ensuring that board meetings are held at regular intervals and that board packs contain the necessary information and are circulated in a timely manner prior to meetings to allow the directors to properly review and scrutinise the information to facilitate effective decision making.

Remunerate Fairly and Responsibly (Principle 9)

Best Practice Recommendation 9.2 recommends that the board should establish a remuneration committee with responsibility for reviewing and making recommendations to the board on senior executive remuneration and incentive policies and packages and the remuneration framework for directors. However, due to the current size and composition of the Company’s board, the full board will be responsible for the above duties.

The board recognises that its remuneration policy must be structured to attract, motivate and retain key employees and encourage them to deliver performance to create value for shareholders.

The board has agreed on the following set of key Remuneration Policy Guidelines from which to determine the remuneration policy for directors, senior executives and employees:

• Individual reward should be based on performance across a range of measurable and qualitative indicators;

• Rewards to executives should be linked to creating value for shareholders;

• Remuneration arrangements should be equitable and facilitate the deployment of senior management across the various divisions of the Company;

• Remuneration packages should be comparable and competitive against remuneration packages of other companies within the industries which the Company operates.

Recognise the Legitimate Interests of Stakeholders (Principle 10)

The Company has adopted a Corporate Code of Conduct for all of its employees in order to ensure the Company meets its legal and other obligations to legitimate stakeholders. These stakeholders include shareholders, customers, suppliers, employees and the community as a whole.

Employees are expected to apply the principles and guidelines set out in the Corporate Code of Conduct at all times in carrying out their duties for the Company.

28

==> picture [143 x 30] intentionally omitted <==

BDO Kendalls Audit & Assurance (WA) 128 Hay Street SUBIACO WA 6008 PO Box 700 WEST PERTH WA 6872 Phone 61 8 9380 8400 Fax 61 8 9380 8499 aa.perth@bdo.com.au www.bdo.com.au

ABN 90 360 101 594

27 September 2007

The Directors ABM Resources NL Level 1, 141 Broadway Nedlands WA 6009

Dear Sirs

DECLARATION OF INDEPENDENCE BY BDO KENDALLS TO THE DIRECTORS OF ABM RESOURCES NL

As lead auditor of ABM Resources NL for the year ended 30 June 2007, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

• the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

• any applicable code of professional conduct in relation to the audit.

This declaration is in respect of ABM Resources NL and the entities it controlled during the period.

Yours faithfully BDO Kendalls Audit & Assurance (WA) (formerly BDO)

==> picture [95 x 62] intentionally omitted <==

BG McVeigh Partner

BDO Kendalls is a national association of separate partnerships and entities

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

INCOME STATEMENTS FOR YEAR ENDED 30 JUNE 2007

Note Revenue 2 Other income 3 Cost of sales Loss from sale of property, plant & equipment 4(a) Loss from sale of financial assets 4(a) Employee benefits expenses Depreciation and amortisation expenses 4(a) Consultancy expenses Directors’ fees Write-off of capitalised exploration expenditure 4(b) Finance cost 4(a) Legal fees Lease expenses Insurance Provision for impairment loss 4(a) Other expenses from ordinary activities Loss before income tax Income tax expense 5 Loss attributable to members of the parent entity	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 177,860 290,319 170,384 56,030 50,063 312,859 15,324 245,251 - (247,011) - - (241,273) (50,262) (45,315) (7,387) (757,406) - (757,406) - (687,569) (486,300) (610,417) (207,208) (306,249) (679,735) (67,098) (50,927) (304,488) (401,390) (271,046) (164,909) (472,849) (247,374) (447,849) (140,864) (274,687) (959,570) (155,855) (68,195) (733) (16,111) (733) (14,523) (118,307) (108,730) (114,783) (108,730) (94,922) (122,927) (94,922) (58,666) (56,511) (47,584) (56,511) (19,334) - - (653,988) (2,377,017) 152,507 (339,667) 155,651 (187,004)
	(2,934,564) (3,103,483) (2,934,564) (3,103,483) - - - -
	(2,934,564) (3,103,483) (2,934,564) (3,103,483)

Overall Operations

Basic loss per share (cents per share)

(0.62) (0.75)

The above income statements should be read in conjunction with the accompanying notes.

30

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

BALANCE SHEET AS AT 30 JUNE 2007

Note ASSETS CURRENT ASSETS Cash and cash equivalents 9 Trade and other receivables 10 Property, plant and equipment 15 Exploration, evaluation and development expenditure 16 Other current assets 12 TOTAL CURRENT ASSETS NON-CURRENT ASSETS Trade and other receivables 10 Other financial assets 11 Property, plant and equipment 15 Exploration, evaluation and development expenditure 16 TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables 17 Borrowings 18 Provisions 19 TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Provisions 19 TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Contributed Equity 20 Available for sale asset reserve Accumulated losses TOTAL EQUITY	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 4,285,002 1,427,969 4,232,357 1,387,415 19,396 57,585 8,975 42,835 409 1,221,093 409 - 18,000 - - - 62,040 30,836 60,306 30,836
	4,384,847 2,737,483 4,302,047 1,461,086
	781,513 750,895 667,256 638,945 - 975,000 610,564 2,645,418 368,324 272,856 210,346 211,499 1,776,938 436,199 1,706,066 393,266
	2,926,775 2,434,950 3,194,232 3,889,128
	7,311,622 5,172,433 7,496,279 5,350,214
	307,923 226,174 303,975 215,350 - 9,318 - 9,318 555,426 11,977 555,426 11,977
	863,349 247,469 859,401 236,645
	294,124 728,351 169,624 603,851
	294,124 728,351 169,624 603,851
	1,157,473 975,820 1,029,025 840,496
	6,154,149 4,196,613 6,467,254 4,509,718
	51,980,766 47,613,666 51,980,766 47,613,666 - (525,000) - (525,000) (45,826,617) (42,892,053) (45,513,512) (42,578,948)
	6,154,149 4,196,613 6,467,254 4,509,718

The above balance sheets should be read in conjunction with the accompanying notes.

31

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2007

Economic Entity Balance at 30 June 2005 Shares issued during the year Transaction costs Loss attributable to members of economic entity Total net recognised income and expense for the year Shares issued to employees for compensation Revaluation decrement Balance at 30 June 2006 Shares issued during the year Share buy back Transaction costs Loss attributable to members of economic entity Total net recognised income and expense for the year Shares issued to employees for compensation Recycling of available for sale asset reserve Balance at 30 June 2007	Share Capital Ordinary Accumulated Losses Available for Sale Asset Reserve Total $ $ $ $ 43,886,157 (39,788,570) - 4,097,587 3,878,683 - - 3,878,683 (206,497) - - (206,497) - (3,103,483) - (3,103,483)
	(3,103,483) (3,103,483) 55,323 - - 55,323 - - (525,000) (525,000)
	47,613,666 (42,892,053) (525,000) 4,196,613
	4,300,000 - - 4,300,000 (50) - - (50) (292,480) - - (292,480) - (2,934,564) - (2,934,564)
	(2,934,564) (2,934,564) 359,630 - - 359,630 - - 525,000 525,000
	51,980,766 (45,826,617) - 6,154,149

32

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2007

Parent Entity Balance at 30 June 2005 Shares issued during the year Transaction costs Loss attributable to members of parent entity Total net recognised income and expense during the year Shares issued to employees for compensation Revaluation decrement Balance at 30 June 2006 Shares issued during the year Share buy back Transaction costs Loss attributable to members of parent entity Total net recognised income and expense during the year Shares issued to employees for compensation Recycling of available for sale asset reserve Balance at 30 June 2007	Share Capital Ordinary Accumulated Losses Available for Sale Asset Reserve Total $ $ $ $ 43,886,157 (39,475,465) - 4,410,692 3,878,683 - - 3,878,683 (206,497) - - (206,497) - (3,103,483) - (3,103,483)
	(3,103,483) (3,103,483) 55,323 - - 55,323 - - (525,000) (525,000)
	47,613,666 (42,578,948) (525,000) 4,509,718
	4,300,000 - - 4,300,000 (50) - - (50) (292,480) - - (292,480) - (2,934,564) - (2,934,564)
	(2,934,564) (2,934,564) 359,630 - - 359,630 - - 525,000 525,000
	51,980,766 (45,513,512) - 6,467,254

The above statements of changes in equity should be read in conjunction with the accompanying notes.

33

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2007

Note CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest received Finance cost Net cash provided by / (used in) operating activities 25 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property, plant and equipment Proceeds from sale of other financial assets Proceeds from sale of exploration, evaluation and development projects Purchase of property, plant and equipment Environmental bonds Payments for exploration, evaluation and development Net cash provided by / (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares Proceeds from sale of unmarketable parcels of shares Receipts from director’s loans Repayment of director’s loan Repayment of borrowings Share issue costs Loans provided to controlled entities Net cash provided by / (used in) financing activities Net increase / (decrease) in cash and cash equivalents held Cash and cash equivalents at 1 July 2006 Cash and cash equivalents at 30 June 2007 25	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 49,538 347,632 34,762 294,376 (1,054,992) (2,845,928) (962,444) (1,889,061) 178,385 62,372 170,384 56,030 (733) (16,111) (733) (14,523)
	(827,802) (2,452,035) (758,031) (1,553,178)
	758,855 391,486 106,355 176,528 742,594 - 742,594 - - 744,833 - 744,833 (181,161) (20,982) (181,161) (20,982) - 28,000 - 12,000 (1,633,426) (514,766) (1,468,655) (441,093)
	(313,138) 628,571 (800,867) 471,286
	4,300,000 3,298,665 4,300,000 3,298,665 (229) 377 (229) 377 - 100,000 - 100,000 - (100,000) - (100,000) (9,318) - (9,318) - (292,480) (206,499) (292,480) (206,499) - - 405,867 (799,416)
	3,997,973 3,092,543 4,403,840 2,293,127
	2,857,033 1,269,079 2,844,942 1,211,235 1,427,969 158,890 1,387,415 176,180
	4,285,002 1,427,969 4,232,357 1,387,415

The above cash flow statements should be read in conjunction with the accompanying notes.

34

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the Corporations Act 2001.

The financial report covers the economic entity of ABM Resources NL and controlled entities, and ABM Resources NL as an individual parent entity. ABM Resources NL is a listed public company, incorporated and domiciled in Australia.

The financial report of ABM Resources NL and controlled entities, and ABM Resources NL an individual parent entity, complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (AIFRS), in their entirety. Compliance with AIFRS ensures that the financial report also complies with International Financial Reporting Standards (IFRS) in their entirety.

The following is a summary of the material accounting policies adopted by the economic entity in the preparation of the financial report. The accounting policies have been consistently applied to all the years presented, unless otherwise stated.

Basis of Preparation

Compliance with IFRS

Australian Accounting Standards include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the consolidated financial statements and notes of ABM Resources NL comply with International Financial Reporting Standards (IFRS). The economic entity financial statements and notes also comply with IFRS except that it has elected to apply the relief provided to economic entities in respect of certain disclosure requirements contained in AASB 132 Financial Instruments: Disclosure and Presentation.

Early adoption of standards

The economic entity has elected to apply the following pronouncement to the annual reporting period beginning 1 July 2006:

• Revised AASB 101 Presentation of Financial Statements (issued October 2006)

This includes applying the pronouncement to the comparatives in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors. No adjustments to any of the financial statements were required for the above pronouncement, but certain disclosures are no longer required and have therefore been omitted.

Historical cost convention

These financial statements have been prepared under the historical cost conventions, as modified by the revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss, certain classes of property, plant and equipment.

Critical accounting estimates

The preparation of financial statement in conformity with AIFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of

35

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Critical Accounting Estimates cont’d.

applying the economic entities accounting policies. There were no areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements.

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

Accounting Policies

(a) Principles of Consolidation

(i) Subsidiaries

A controlled entity is any entity ABM Resources NL has the power to control the financial and operating policies of so as to obtain benefits from its activities.

A list of controlled entities is contained in Note 13 to the financial statements. All controlled entities have a June financial year-end.

All inter-Company balances and transactions between entities in the economic entity, including any unrealised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistencies with those policies applied by the parent entity.

Where controlled entities have entered or left the economic entity during the year, their operating results have been included/excluded from the date control was obtained or until the date control ceased.

Minority equity interests in the equity and results of the entities that are controlled are shown as a separate item in the consolidated financial report.

(ii) Joint Ventures

Jointly controlled assets

The proportionate interests in the assets, liabilities and expenses of a joint venture activity have been incorporated in the financial statement under the appropriate headings. Details of the joint venture are set out in Note 14.

Joint Venture entities

The interest in a joint venture partnership is accounted for in the consolidated financial statement using the equity method and is carried at cost by the parent entity. Under the equity method, the share of the profits or losses of the partnership is recognised in the income statement, and the share of movements in reserves is the balance sheet. Details relating to the partnership are set out in Note 14.

Profits and losses on transactions establishing the joint venture partnership and transactions with the joint venture are eliminated to the extend of the Group’s ownership interest until such time as they are realised by the joint venture partnership on consumption

36

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Joint Venture Entities cont’d.

of sale, unless they relate to an unrealised loss that provides evidence of the impairment of an asset transferred.

(b) Income Tax

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

Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be 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 deferred tax is adjusted directly against equity.

Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised.

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

ABM Resources NL and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under the Tax Consolidation Regime from 1 July 2003. ABM Resources NL is responsible for recognising the current and deferred tax assets and liabilities for the tax consolidated group. The tax consolidated group is in the process of entering into a tax sharing agreement whereby each company in the group contributes to the income tax payable in proportion to their contribution to the net profit before tax on the tax consolidated group.

Future income tax benefits are not brought to account unless realisation of the asset is assured beyond reasonable doubt. Future income tax benefits in relation to tax losses are not brought to account unless there is virtual certainty of realisation of the benefit.

(c) 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.

Property

Freehold land and buildings are carried at cost.

37

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Property, Plant and Equipment cont’d.

Plant and equipment

Plant and equipment are 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.

The cost of fixed assets constructed within the economic entity includes the cost of materials, direct labour, borrowing costs and an appropriate proportion of fixed and variable overheads.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater that it’s estimated recoverable amount.

(d) Depreciation

The depreciable amount of all fixed assets including capitalised lease assets, but excluding freehold land and buildings, is depreciated on a straight-line or reducing balance method 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.

Depreciation rates are reviewed at least annually and where necessary, adjusted to reflect the most recent assessments of the useful lives of the respective assets, having regard to such factors as asset usage and the rate of technical and commercial obsolescence.

In addition depreciation methods are reviewed at least annually and, if there has been a change in the expected pattern of consumption or loss of future economic benefits, the method applied is changed to reflect the changed pattern.

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

Class of Fixed Asset	Depreciation Rate
Leasehold improvements	33.3%
Plant and equipment	10% - 40%

(e) Exploration and Evaluation Expenditure

Exploration and evaluation 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 and exploitation of the area of interest or alternatively by its sale and where activities in the area have not yet reached a stage which 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.

38

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Exploration and Evaluation Expenditure cont’d.

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.

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 restoration are provided over the life of the facility from when exploration commences and are included in the costs of that stage. Site 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. The estimated cost is determined to be the equivalent to the bonds provide to the relevant government departments.

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.

(f) Leases

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses in the periods in which they are incurred.

(g) Financial Instruments

Recognition

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

Loans and receivables

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

Available-for-sale financial assets

Available-for-sale financial assets include any financial assets not included in the above categories. Available-for-sale financial assets are reflected at fair value. Unrealised gains and losses arising from changes in fair value are taken directly to equity.

Financial liabilities

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

39

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Financial Instruments cont’d.

Fair value

Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.

Impairment

At each reporting date, the economic entity assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether any impairment has arisen. Impairment losses are recognised in the income statement.

(h) Impairment of Assets

At each reporting date, the economic entity reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the income statement.

Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.

Where it is not possible to estimate the recoverable amount of an individual asset, the economic entity estimates the recoverable amount of the cash-generating unit to which the asset belongs.

(i) Foreign Currency Transactions and Balances

Functional and presentation currency

The functional currency of each of the economic entity’s entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional and presentation currency.

Transaction and balances

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

Exchange differences arising on the translation of monetary items are recognised in the income statement, except where deferred in equity as a qualifying cash flow or net investment hedge.

40

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Transaction and Balances cont’d.

Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the income statement.

(j)

Employee Benefits

Provision is made for the parent entity's liability for employee benefits arising from services rendered by employees to balance date. Employee benefits expected to be settled within one year arising from wages and salaries, annual leave and long service leave have been measured at their nominal amounts plus related on-costs. Other employee benefits, including related on-costs, payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits.

Contributions are made by the economic entity to employee nominated eligible superannuation funds and are charged as expenses when incurred.

The fair value of employee shares granted by ABM Resources NL is recognised as an expense with a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which the share holder becomes unconditionally entitled to the shares. The fair value at grant date is determined by the market value of the shares at issue date..

(k) Provisions

Provisions are recognised when the economic entity has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

(l) Cash and Cash Equivalents

Cash and cash equivalents include 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 liabilities on the balance sheet.

(m) Revenue

Revenue from the sale of goods is recognised upon the delivery of goods to customers.

Revenue from rental properties is recognised when the parent entity has a right to receive the rent in accordance with the lease agreement.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

Revenue from the rendering of a service is recognised upon the delivery of the service to the customers.

All revenue is stated net of the amount of goods and services tax (GST).

41

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Statement of Significant Accounting Policies cont’d.

(n) Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

All other borrowing costs are recognised in income in the period in which they are incurred.

(o) Goods and Services Tax (GST)

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.

(p) Comparative Figures

Where required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

(q) Going Concern

The financial statements have been prepared on the going concern basis of accounting which assumes that the economic entity will be able to meet its commitments, realise its assets and discharge its liabilities in the ordinary course of business.

(r) Critical Accounting Estimates and Judgments

The directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the economic entity.

Key Estimates – Impairment

The economic entity assesses impairment at each reporting date by evaluating conditions specific to the economic entity that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates.

(s) Issued Capital

Issued capital is recognised at the fair value of the consideration received by the Company.

42

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 1: Issued Capital cont’d.

Employee shares granted are recognised at fair value. The fair value is measured at grant date and recognised over the period during which the share holder becomes unconditionally entitled to the shares. The fair value at grant date is determined by the market value of the shares at issue date.

Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the proceeds received.

NOTE 2: REVENUE Operating Activities: - revenue from sale of goods Total Revenue Non-operating Activities: - interest received Total Revenue NOTE 3: OTHER INCOME - other revenue - foreign exchange gain - profit from sale of financial assets Total Other Income	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ (525) 227,947 - -	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ (525) 227,947 - -
	(525) 227,947 - -
	178,385 62,372 170,384 56,030
	178,385 62,372 170,384 56,030
	177,860 290,319 170,384 56,030
		Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 50,063 178,856 15,324 114,126 - 2,753 - (125) - 131,250 - 131,250
		50,063 312,859 15,324 245,251

43

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 4: (a) EXPENSES Finance cost - External - other related parties Total finance cost Depreciation of non-current assets - plant and equipment - leasehold improvements Total depreciation (Note 15) Loss on sale of assets - loss on sale of property, plant and equipment - loss from sale of financial assets Total loss on sale of assets Impairment of loans receivable - wholly-owned subsidiaries Foreign currency loss Share-based payment	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 733 14,319 733 12,731 - 1,792 - 1,792
	733 16,111 733 14,523
	301,290 679,587 62,139 50,927 4,959 148 4,959 -
	306,249 679,735 67,098 50,927
	241,273 50,262 45,315 7,387 757,406 - 757,406 -
	998,679 50,262 802,721 7,387
	- - 653,988 2,377,017 (5,094) - (133) - 359,630 55,323 359,630 55,323

(b) Significant Revenue and Expenses

The following significant revenue and expense items are relevant in explaining the financial performance:

-[Write-off of capitalised exploration ] (274,687) (959,570) (155,855) (68,195) expenditure - (non-current) - Cost of exploration interests sold - (2,250,000) - (2,250,000) -[Consideration for exploration interests ] - 2,250,000 - 2,250,000 sold

44

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

			Economic Entity	Economic Entity	Parent Entity	Parent Entity
			2007	2006	2007	2006
NOTE	5:	(a) INCOME TAX EXPENSE	$	$	$	$
		The prima facie tax on profit before
		income tax is reconciled to the income
		tax as follows:
		Prima facie tax on loss before income tax at 30% (2006: 30%)	(880,369)	(931,045)	(880,369)	(931,045)
		Add:
		Tax effect of:
		- other non-allowable items	1,105	11,509	1,105	11,509
		-write-downs to recoverable amounts	393,928	823,650	393,635	564,852
			(485,336)	(95,886)	(485,629)	(354,684)
		Tax losses not recognised	485,336	95,886	485,629	354,684
		Income tax (benefit) attributable to
		entity	-	-	-	-

Economic	Entity	Parent	Entity
2007	2006	2007	2006
$	$	$	$

(b) TAX LOSSES $ $ $ $ Unused tax losses for which no deferred tax asset has been 30,448,849 26,994,879 29,837,407 24,617,862 recognised Potential tax benefit @ 30% 9,134,655 8,098,464 8,951,222 7,385,359

All unused tax losses were incurred by Australian entities that are part of the tax consolidated group, details as per Note 1(b).

45

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 6: KEY MANAGEMENT PERSONNEL COMPENSATION

(a) Names and positions held of economic and parent entity key management personnel in office at any time during the financial year are:

Key Management Person Position

Mr I Kins Executive Chairman Mr T King Chairman (Non-executive) / Company Secretary Ms S Ahmad Director (Non-executive) Mr D Reynolds Director (Non-executive) Mr A Simpson Director (Non-executive) Mr B Rees Consultant Company Geologist Mr P Heydon Operations Manager Ms J Zimmermann Chief Financial Officer / Company Secretary

(b) Compensation Practices

The compensation structure for key management personnel is based on a number of factors, including qualifications, length of service, particular experience of the individual concerned, and overall performance of the Company. The contracts for service between the Company and key management personnel are on a continuing basis, the terms of which are not expected to change in the immediate future. Upon retirement key management personnel are paid employee benefit entitlements accrued to date of retirement. No redundancy payments are offered to specified executives. The Executive Chairman may receive termination benefits depending on the circumstances of termination. The economic entity seeks to emphasise bonuses and incentives for results through providing cash bonuses and equity participation through the employee share plan, specifically, the incorporation of incentive bonuses based on the achievement of growth in shareholder’s value and the achievement of predetermined performance criteria.

Bonuses included per Note 6(c) are based on these criteria. The objective of the reward scheme is to both reinforce the short- and long-term goals of the economic entity and to provide a common interest between management and shareholders. The bonuses were granted to key management personnel throughout the financial year. There has been no alteration to the terms of the bonuses paid since grant date.

Remuneration and other terms of engagement for non-executive directors are formalised in service agreements and this process has been completed in August 2007. The agreement summarises the board policies and terms, including compensation relevant to the office of director.

The employment conditions of the Executive Chairman, Mr Kins, the executive director and specified executives are formalised in contracts of employment. Each of these contracts provide for equity based incentives, subject to KPI’s specified in the contract of employment, and other benefits including participation in salary packaging options. With the exception of the Executive Chairman in certain specified circumstances, share incentives in respect of which the performance and/or employment continuity conditions have not been satisfied, become eligible for buy back by the Company for nominal consideration.

46

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 6: Compensation Practices cont’d.

The employment contracts stipulate a range of one- to three-month resignation notification periods. The Company may terminate an employment contract without cause by providing a range of one- to three-month written notice or making payment in lieu of notice, based on the individual’s annual salary component. No redundancy payments are offered to specified executives. In the instance of serious misconduct the Company can terminate employment at any time.

Other major provisions of the agreements relating to remuneration are set out below:

I Kins, Executive Chairman

• Term of Agreement – 3 years commencing 1 October 2005

• Base Salary, inclusive of superannuation, for the year ended 30 June 2007 of $235,962, to be reviewed annually by the remuneration committee

• Payment of a termination benefit on early termination by the Company, other than for gross misconduct, equal to the base salary for the remaining term of the agreement

J Zimmermann, Chief Financial Officer and Company Secretary (from 17 April 2007)

• Term of Agreement – ongoing commencing 1 June 2005

• Base Salary, inclusive of superannuation, for the year ended 30 June 2007 of $116,781, to be reviewed annually by the remuneration committee

• P Heydon, Operations Manager

• Term of Agreement – ongoing initial contract commencing 21 February 2001

• Base Salary, inclusive of superannuation, for the year ended 30 June 2007 of $138,298, to be reviewed annually by the remuneration committee

• B Rees, Geological Consultant Manager (previously a long term employee of the Company)

• Term of Agreement – ongoing commencing 12 June 2006

• Daily rate with no superannuation applicable, total remuneration for the year ended 30 June 2007 of $97,300

47

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 6: Key Management Personnel Compensation cont’d.

(c) Key Management Personnel Compensation:

2007 Key Management Person Mr I Kins Mr T King Ms S Ahmad Mr D Reynolds Mr A Simpson Mr P Heydon Ms J Zimmermann Mr B Rees

Short-term benefits Post- employment benefits Cash, salary and commissions Share- based payment - shares Super- annuation Total Performance related Non Performance related $ $ $ $ % % 209,391 154,000 26,571 389,962 39.49 60.51 50,000 - - 50,000 - 100 7,500 - - 7,500 - 100 20,480 - - 20,480 - 100 4,502 - 405 4,907 - 100 126,879 6,000 11,419 144,298 4.16 95.84 107,553 3,000 9,228 119,781 2.50 97.50 97,300 20,800 118,100 17.61 82.39 623,605 183,800 47,623 855,028

2006 Key Management Person Mr T King Mr I Kins Mr M Fotios Ms S Ahmad Mr D Reynolds Mr B Rees Mr P Heydon Mr T Brittliffe Ms J Zimmermann Mr A Still

Short-term benefits Post- employment benefits Cash, salary and commissions Share- based payment - shares Super- annuation Total Performance related Non Performance related $ $ $ $ % % 52,500 - - 52,500 - 100 125,989 - 11,549 137,538 - 100 69,236 - - 69,236 - 100 18,000 - - 18,000 - 100 15,834 - - 15,834 - 100 129,910 - 972 130,882 - 100 137,997 18,000 10,350 166,347 10.82 89.18 59,317 - - 59,317 - 100 88,854 3,000 7,199 99,053 3.03 96.97 119,136 26,000 - 145,136 17.91 82.09 816,773 47,000 30,070 893,843

(d) Compensation Options

No Options have been granted to Directors or specified executives.

48

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 6: Key Management Personnel Compensation cont’d.

(e) Shares Issued on Exercise of Remuneration Options

No shares were issued on exercise of remuneration options.

(f) Shares issued as Compensation

All shares issued to employees, contractors and the executive chairman were issued for no consideration and valued at the market price on issue date. For details on the valuation please refer to note 1(j).

The term and conditions of all shares issued under the employee share plan or under the same rules as the employee share plan are as follows:

Issue date 17 Nov 2005 5 Apr 2006 Buy-Back 3 Oct 2006 31 Jul 2006 3 Nov 2006 12 Jan 2007 Total

Shares issued under the employee share plan Number of shares issued Issue Price per share $ Total Value $ Number of shares without holding lock or released from escrow in 2006 Number of shares without holding lock or released from escrow in 2007 Financial year in which the shares may be released from escrow Number of shares Weighted value for 2007 $ 2,600,000 0.015 39,000 1,400,000 600,000 2008 600,000 14,319 3,200,000 0.052 166,400 500,000 1,900,000 2008 400,000 110,284 - - - - - 2009 400,000 (500,000) 0.052 (26,000) - (500,000) - - (26,000) 6,500,000 0.044 286,000 - 3,500,000 2007 1,500,000 233,780 2008 1,500,000 700,000 0.05 35,000 - 100,000 2007 100,000 14,948 2008 100,000 2009 400,000 800,000 0.105 84,000 - - 2009 400,000 12,299 2010 400,000

13,300,000 584,400 1,900,000 5,600,000 5,800,000 359,630

(g) Options and Rights Holdings

No options and right holdings have been granted.

49

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 6: Key Management Personnel Compensation cont’d.

(h) Shareholdings

Mr I Kins Mr T King Ms S Ahmad Mr D Reynolds Mr A Simpson Mr P Heydon Ms JZimmermann Mr B Rees Mr I Kins Mr T King Ms S Ahmad Mr D Reynolds Mr P Heydon Ms JZimmermann Mr B Rees	Balance 1-7-06 Received as Compensation Options Exercised Net Change Other* Balance 30-6-07 - 6,500,000 - - 6,500,000 - - - - - - - - - - - - - - - - - - - - 2,000,000 - - - 2,000,000 600,000 400,000 - - 1,000,000 1,200,000 800,000 - - 2,000,000
	3,800,000 7,700,000 - - 11,500,000
	Balance 1-7-05 Received as Compensation Options Exercised Net Change Other* Balance 30-6-06 - - - - - - - - - - - - - - - - - - - - - 2,000,000 - - 2,000,000 - 600,000 - - 600,000 - 1,200,000 - - 1,200,000
	- 3,800,000 - - 3,800,000

(i) Other transactions with directors and director related parties

No other transactions with directors have occurred.

Other services

Ms M Kins, daughter of Mr Kins, was paid $2,919 as remuneration for services rendered to the economic entity during the year.

The terms and conditions of the transactions with directors and director related parties and entities were no more favourable than those available, or which might reasonably be expected to be available, on similar transactions with non-director related parties and entities on an arm’s length basis.

50

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 6: Key Management Personnel Compensation cont’d.

(j) Loans from directors and director related entities

No loans from directors and director related entities were available during the financial year.

A loan agreement was entered into between Rexfam Consulting (a company associated with Mr Timothy King, former Chairman of the economic entity) and the economic entity in 2006. The loan was repaid during the 2006 financial year.

			Accrued	Actual		Accrued	Actual
			interest for the	year end	Interest	interest for the	year end	Interest
		Loans	year	accrual	rate	year	accrual	rate
	Facility	advanced	2007	2007	2007	2006	2006	2006
Director	$	$	$	$	%	$	$	%
Mr T King (Note 6(h), 19)	100,000	100,000	-	-	-	679	679	8

		Economic	Entity	Parent Entity	Parent Entity
		2007	2006	2007	2006
NOTE	7: AUDITORS’ REMUNERATION	$	$	$	$
	Remuneration of the auditor of the parent
	entity for auditing or reviewing the financial
	report:
	- BDO Kendalls Audit & Assurance (WA)	22,947	-	22,947	-
	- Grant Thornton	4,000	44,598	4.000	44,598
	Total auditors’ remuneration	26,947	44,598	26,947	44,598
				Economic Entity
				2007	2006
NOTE	8: EARNINGS PER SHARE			$	$
	(a) Net (loss) used in the calculation of basic	EPS	(2,934,564)		(3,103,483)
	(b) Weighted average number of ordinary shares used in calculating basic EPS		473,118,018		412,781,065

The Company does not have potential ordinary shares and therefore a diluted EPS is not shown.

51

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

		Economic Entity	Economic Entity	Parent Entity	Parent Entity
		2007	2006	2007	2006
NOTE	9: CASH ASSETS	$	$	$	$
	Cash at bank and in hand	95,324	143,838	42,679	103,284
	Short-term bank deposits	4,189,678	1,284,131	4,189,678	1,284,131
		4,285,002	1,427,969	4,232,357	1,387,415

The effective interest rate on short-term bank deposits ranged between 5.3% and 6.67% these deposits have an average maturity of 45 days.

The effective interest rate for cash at bank ranged between 0% and 4.5%.

NOTE 10:TRADE & OTHER RECEIVABLES CURRENT Trade receivables Other receivables NON-CURRENT Bond term deposits NOTE 11: OTHER FINANCIAL ASSETS CURRENT Available-for-sale financial assets Available-for-sale Financial Assets Comprise Listed investments, at fair value - Shares in listed corporations Wholly owned entities – at cost - provision for impairment of receivables wholly-owned subsidiaries	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 7,806 43,212 - 28,464 11,590 14,373 8,975 14,371
	19,396 57,585 8,975 42,835
	781,513 750,895 667,256 638,945
	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ - 975,000 610,564 2,645,418
	- 975,000 - 975,000 - - 10,684,359 11,090,225 - - (10,073,795) (9,419,807)
	- 975,000 610,564 2,645,418

52

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

		Economic Entity	Economic Entity	Parent	Entity
		2007	2006	2007	2006
NOTE	12: OTHER CURRENT ASSETS	$	$	$	$
	Prepayments	62,040	30,836	60,306	30,836
		62,040	30,836	60,306	30,836

NOTE	13: CONTROLLED ENTITIES
	Controlled Entities Consolidated
		Country of	Percentage	Owned (%)
		Incorporation	2007	2006
	Parent Entity
	ABM Resources NL	Australia	-	-
	Subsidiaries of ABM Resources NL
	ABM Resources Operations Pty Ltd	Australia	100	100
	Rare Resources NL	Australia	100	100
	Broad Arrow Mill Pty Ltd	Australia	100	100
NOTE	14: INTERESTS IN JOINT VENTURES	Country of	Percentage	Owned (%)
		Incorporation	2007	2006
	Joint Ventures of ABM Resources NL
	AYR Resources Mozambique	Mozambique	40	-

In June 2007 the parent entity has participated in the establishment of AYR Resources Mozambique in which it holds a 40% interest with the aim to secure gold projects in Mozambique. All expenditure incurred by the parent entity has been capitalized as exploration, evaluation and development expenditure and expenditure relating to the Company set up has been written down.

Non-current assets Exploration, evaluation and development expenditure Total non-current assets	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 350,063 - 350,063 -
	350,063 - 350,063 -

53

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 15: PROPERTY, PLANT AND EQUIPMENT LAND AND BUILDINGS Freehold land and buildings - at cost Total Land PLANT AND EQUIPMENT Plant and equipment: At cost Accumulated depreciation Total Plant and Equipment Leasehold improvements: At cost Accumulated depreciation Total leasehold improvements Total plant and equipment Total Property, Plant and Equipment Current Property, Plant and Equipment Non-current Property, Plant and Equipment	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 5,113 87,322 5,113 87,322
	5,113 87,322 5,113 87,322
	966,261 2,506,380 409,649 338,037 (615,531) (1,099,753) (216,897) (213,860)
	350,730 1,406,627 192,752 124,177
	17,849 - 17,849 - (4,959) - (4,959) -
	12,890 - 12,890 -
	363,620 1,406,627 205,642 124,177
	368,733 1,493,949 210,755 211,499
	409 1,221,093 409 - 368,324 272,856 210,346 211,499
	368,733 1,493,949 210,755 211,499

The group’s land and buildings were valued at cost.

Current Property, Plant and Equipment includes plant and equipment located at Nedlands sold since reporting date.

54

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 15: Property, Plant and Equipment cont’d.

Movements in Carrying Amounts

Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year:

2007 Economic Entity: Balance at the beginning of year Additions Disposals Depreciation expense Carrying amount at the end of year 2007 Parent Entity: Balance at the beginning of year Additions Disposals Re-allocations at book value Depreciation expense Carrying amount at the end of year 2006 Economic Entity: Balance at the beginning of year Additions Disposals Depreciation expense Carrying amount at the end of year 2006 Parent Entity: Balance at the beginning of year Additions Disposals Depreciation expense Carrying amount at the end of year	Freehold Land Leasehold Improvements Plant and Equipment Total $ $ $ $ 87,322 - 1,406,627 1,493,949 - 17,849 163,312 181,161 (82,209) (917,919) (1,000,128) - (4,959) (301,290) (306,249)
	5,113 12,890 350,730 368,773
	Freehold Land Leasehold Improvements Plant and Equipment Total $ $ $ $ 87,322 - 124,177 211,499 - 17,849 163,312 181,161 (82,209) - (69,461) (151,670) - - 36,863 36,863 - (4,959) (62,139) (67,098)
	5,113 12,890 192,752 210,755
	Freehold Land Leasehold Improvements Plant and Equipment Total $ $ $ $ 87,322 748 2,506,381 2,594,451 - - 20,982 20,982 - (600) (441,149) (441,749) - (148) (679,587) (679,735)
	87,322 - 1,406,627 1,493,949
	Freehold Land Leasehold Improvements Plant and Equipment Total $ $ $ $ 87,322 - 338,038 425,360 - - 20,982 20,982 - - (183,916) (183,916) - - (50,927) (50,927)
	87,322 - 124,177 211,499

55

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 16: EXPLORATION, EVALUATION AND DEVELOPMENT EXPENDITURE AUSTRALIA Costs carried forward in respect of areas of interest in exploration and evaluation phases Costs incurred during the year Cost of exploration interests sold Costs written off EXPLORATION, EVALUATION AND DEVELOPMENT EXPENDITURE AFRICA Costs incurred during the year Costs written off Total exploration, evaluation and development expenditure Current exploration expenses Non-current exploration expenses	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 436,199 3,131,003 393,266 2,270,368 1,270,465 514,766 1,105,694 441,093 - (2,250,000) - (2,250,000) (261,789) (959,570) (142,957) (68,195)
	1,444,875 436,199 1,356,003 393,266
	362,961 - 362,961 - (12,898) - (12,898) -
	350,063 - 350,063 -
	1,794,938 436,199 1,706,066 393,266
	18,000 - - - 1,776,938 436,199 1,706,066 393,266
	1,794,938 436,199 1,706,066 393,266

Ultimate recoupment of exploration and evaluation expenditure carried forward is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.

		Economic Entity	Economic Entity	Parent	Entity
		2007	2006	2007	2006
NOTE	17: TRADE AND OTHER PAYABLES	$	$	$	$
	CURRENT
	Unsecured liabilities
	Trade payables	169,247	121,801	167,109	118,593
	Sundry payables and accrued expenses	138,676	104,373	136,866	96,757
		307,923	226,174	303,975	215,350
		Economic Entity		Parent	Entity
NOTE	18: BORROWINGS	2007	2006	2007	2006
		$	$	$	$
	CURRENT
	Unsecured liabilities:
	Insurance finance	-	9,318	-	9,318
		-	9,318	-	9,318

56

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 19: PROVISIONS Economic Entity Opening balance at 1 July 2006 Additional provisions Amounts used Unused amounts reversed Increase in the discounted amount arising because of time and the effect of any change in the discount rate Balance at 30 June 2007 Parent Entity Opening balance at 1 July 2006 Additional provisions Amounts used Unused amounts reversed Increase in the discounted amount arising because of time and the effect of any change in the discount rate Balance at 30 June 2007 Analysis of Total Provisions Current Non-current	Employee Entitlements Mine Restorations Annual Leave Long Service Leave Other Total $ $ $ $ $ 700,000 11,977 28,151 200 740,328 - 89,185 31,169 - 120,354 - (22,708) - (200) (22,908) - - (2,495) - (2,495) - 9,972 4,299 - 14,271	Employee Entitlements Mine Restorations Annual Leave Long Service Leave Other Total $ $ $ $ $ 700,000 11,977 28,151 200 740,328 - 89,185 31,169 - 120,354 - (22,708) - (200) (22,908) - - (2,495) - (2,495) - 9,972 4,299 - 14,271
		700,000 88,426 61,124 - 849,550
		575,500 11,977 28,151 200 615,828 - 89,185 31,169 - 120,354 - (22,708) - (200) (22,908) - - (2,495) - (2,495) - 9,972 4,299 - 14,271
		575,500 88,426 61,124 - 725,050
		Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 555,426 11,977 555,426 11,977 294,124 728,351 169,624 603,851
		849,550 740,328 725,050 615,828

Provision for Employee Entitlements

A provision has been recognised for employee entitlements relating to annual and long service leave. In calculating the present value of future cash flows in respect of long service leave, the probability of long service leave being taken is based on historical data. The measurement and recognition criteria relating to employee benefits has been included in Note 1 to this report.

Provision for Mine Restoration

A provision has been recognised for the cost to be incurred for the restoration of various mine sites based on the net present value of the estimated cost. The estimated cost is determined to be the equivalent to the bonds provided to the relevant government departments. It is anticipated that the restoration work on the various sites will be completed within the next 5 years.

57

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

			Economic Entity	Economic Entity	Parent Entity	Parent Entity
			2007	2006	2007	2006
NOTE	20:	ISSUED CAPITAL	$	$	$	$
	500,594,730 (2006: 453,094,730) fully paid ordinary shares		51,980,766	47,613,666	51,980,766	47,613,666
(a)	Ordinary shares
	At the beginning of the reporting period		47,613,666	43,886,157	47,613,666	43,886,157
	1,000,000 ordinary no consideration *		50,000	-	50,000	-
	Shares issued during the year
	-	14,145,562 ordinary fully paid shares issued at 1.5 cents per share	-	212,183	-	212,183
	-	105,966,666 ordinary fully paid shares issued at 1.5 cents per share	-	1,589,500	-	1,589,500
	-	1,800,000 ordinary fully paid shares issued at 1.5 cents per share	-	27,000	-	27,000
	-	2,600,000 ordinary fully paid shares issued at no consideration *	14,319	21,252	14,319	21,252
	-	3,200,000 ordinary fully paid shares issued at no consideration *	34,284	34,071	34,284	34,071
	-	10,000,000 ordinary fully paid shares issued at 5.5 cents per share	-	550,000	-	550,000
	-	30,000,000 ordinary fully paid shares issued at 5 cents per share	-	1,500,000	-	1,500,000
	-	6,500,000 ordinary fully paid shares at no consideration	233,780	-	233,780	-
	-	500,000 ordinary fully paid shares bought back at 0.001 cents	(50)	-	(50)	-
	-	700,000 ordinary fully paid shares issued at no consideration	14,948	-	14,948	-
	-	10,000,000 ordinary fully paid shares issued at 0.55 cents per share	550,000	-	550,000	-
	-	800,000 ordinary fully paid shares issued at no consideration	12,299	-	12,299	-
	-	30,000,000 ordinary fully paid shares issued at 12.5 cents each	3,750,000	-	3,750,000	-
	Transaction costs relating to share issues		(292,480)	(206,497)	(292,480)	(206,497)
			51,980,766	47,613,666	51,980,766	47,613,666

• These shares are measured at the fair value at grant date and recognised over the period during which the share holder becomes unconditionally entitled to the shares. The fair value at grant date is determined by the market value of the shares at issue date.

58

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 20: Issued Capital cont’d.

At the beginning of reporting period Shares issued during year - 6 July 2005 - 15 July 2005 - 10 November 2005 - 17 November 2005 - 5 April 2006 - 12 April 2006 - 12 April 2006 - 31 July 2006 - 2 October 2006 - 3 November 2006 - 15 December 2006 - 12 January 2007 - 22 March 2007 At reporting date

Economic Entity Parent Entity 2007 2006 2007 2006 453,094,730 285,382,502 453,094,730 285,382,502 - 14,145,562 - 14,145,562 - 105,966,666 - 105,966,666 - 1,800,000 - 1,800,000 - 2,600,000 - 2,600,000 - 3,200,000 - 3,200,000 - 10,000,000 - 10,000,000 - 30,000,000 - 30,000,000 6,500,000 - 6,500,000 - (500,000) - (500,000) - 700,000 - 700,000 - 10,000,000 - 10,000,000 - 800,000 - 800,000 - 30,000,000 - 30,000,000 -

500,594,730 453,094,730 500,594,730 453,094,730

At meetings of shareholders, each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.

(b) Options

At reporting date there were no options on issue.

NOTE 21: RESERVES

(a) Available for Sale Asset Reserve

The asset revaluation reserve records revaluations of non-current assets. Under certain circumstances dividends can be declared from this reserve.

59

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 22:CAPITAL AND LEASING COMMITMENTS (a) Operating Lease Commitments Non-cancellable operating leases contracted for but not capitalised in the financial statements Payable – minimum lease payments - not later than 12 months - between 12 months and 5 years - greater than 5 years	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 74,700 46,016 74,700 46,016 84,200 110,688 84,200 110,688 - - - -
	158,900 156,704 158,900 156,704

Property lease for ABM’s premises is a non-cancellable lease with a three-year term to 31 July 2009, with rent payable monthly in advance. One option exists to renew the lease at the end of the three-year term for an additional term of 3 years.

Contingent rental provisions within the lease agreement require the minimum lease payments shall be increased by 4% per annum. The lease allows for subletting of all lease areas.

(b) Exploration expenditure

In order to maintain current rights of tenure to exploration tenements, the economic entity and the parent entity are required to perform minimum exploration work to meet the minimum expenditure requirements specified by various State Governments. These obligations are not provided for in the financial report and are subject to renegotiation when application for a mining lease is made and at other times.

Payable - not later than 1 year - later than 1 year but not later than 5 years	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ 542,280 350,000 542,280 277,000 2,036,000 1,400,000 2,036,000 1,108,000
	2,578,280 1,750,000 2,578,280 1,385,000

60

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

		Economic Entity	Economic Entity	Parent	Entity
NOTE 23: CONTINGENT		2007	2006	2007	2006
LIABILITIES AND CONTINGENT
ASSETS		$	$	$	$
Estimates of the potential financial
effect of contingent liabilities that	may
become payable –
Bank Guarantee
The parent entity has provided a	bank
guarantee to third party in relation to
the Business Card facility. A	term	25,000	7,500	25,000	7,500
deposit of the same amount secures
this guarantee
The parent entity has provided a	bank
guarantee to the lessor of	the
Nedlands premises. A term deposit of		21,556	21,556	21,556	21,556
the same amount secures	this
guarantee

Environmental

The economic entity provides for all known environmental liabilities. While the Directors believe that, based upon current information, its current provisions for the environmental rehabilitation are adequate, there can be no assurance that material new provisions will not be required as a result of new information or regulatory requirements with respect to known sites or identification of new remedial obligations at other sites.

Tenement Holdings

The Company is involved in a dispute in relation to the holding of a tenement, M16/88. The tenement is the subject of an option held by Kinross Gold Australia associated with the sale of the Norseman tenements to that company by Tantalum Australia in 1998. The tenements and the option (110 or so tenements in all) were sold to Australian Gold Investments Pty Ltd for $2.14 million.

The tenement was forfeited as a result of the late filing of a Form 5 by the then management of Tantalum Australia in October 2003, and the late payment in December 2003 of the subsequent late lodgement fine, although the amount was received and banked by the Mines Department. In October 2005 a new Managing Director was appointed and the Company changed its name to ABM in 2006.

An application for a prospecting licence over ground covered by the tenement was made by another party in competition to ABM Resources. ABM Resources made application for restoration of the tenement on the following basis:

• Taking into account the legal interpretation of the due date for payment of the fine, ABM Resources considered that the payment of the fine occurred within the requisite period;

• There are special circumstances relating to the forfeiture that warrant restoration of the tenement, including:

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ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 23: Tenement Holdings cont’d.

• The fine was paid no more that one day late, and it was many months after that that the competing licence application was submitted;

• ABM has held the tenement for nearly 10 years and, in that time, expended significant sums of money on or in connection with, mining on the tenement;

• ABM’s position would be prejudiced if the tenement was not restored, in that it would be exposed to claims from Kinross and AGI in respect of their interests in the tenements.

The matter was the subject of a Warden’s Court hearing. The Warden handed down a decision in July 2006, recommending to the Minister that ABM Resources’ application for reinstatement of the tenement be refused. Legal advice received by the Company indicated that the Company had strong prospects of winning the restoration application, however there were risks associated with the restoration process, particularly given that the outcome would be a matter of discretion for the Warden and also the Minister.

The Company has reviewed its options in regard to judicially reviewing the decision, and other avenues for the reinstatement of the tenement and has presented a submission to the Minister. The Company is also reviewing the extent of its exposure to possible claims for damages, the possible quantum thereof and the likelihood of any such claims succeeding. Until this process is further advanced, it is too early to form an accurate assessment of the Company’s exposure. The Company is still awaiting the Ministers decision.

NOTE 24: SEGMENT REPORTING

The consolidated entity operated predominantly in the mineral exploration industry in Australia.

62

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

		Economic Entity	Economic Entity	Parent Entity	Parent Entity
		2007	2006	2007	2006
NOTE	25: CASH FLOW INFORMATION	$	$	$	$
	Reconciliation of Cash Flow from
	Operations with (Loss) after
	Income Tax
	(Loss) after income tax	(2,934,564)	(3,103,483)	(2,934,564)	(3,103,483)
	Non-cash investing and financing
	activities
	Depreciation and amortisation expenses	306,249	679,735	67,098	50,927
	Write-off of capitalised exploration expenditure	274,687	959,570	155,855	68,195
	Shares issued to employees	359,580	-	359,580	-
	Net (gain) / loss on disposal of property, plant and equipment	241,273	50,262	45,315	7,387
	Net (gain) on disposal of investments	757,406	-	757,406	-
	Impairment of Investments	-	-	653,988	2,377,020
	Re-allocation of assets of subsidiaries	-	-	(36,863)	-
	Changes in assets and liabilities
	(Increase) / decrease in trade and other receivables	38,189	104,100	33,860	56,513
	(Increase) / decrease in bonds	(30,618)	(52,056)	(28,311)	(52,056)
	(Increase) / decrease in drilling fund	-	39,876	-	39,876
	(Increase) / decrease in pre- payments	(31,204)	(30,070)	(29,470)	(30,070)
	(Increase) / decrease in deferred payments	-	148,144	-	148,144
	(Increase) / decrease in unsecured loans	-	9,318	-	9,318
	(Increase) / decrease in inventories	-	246,470	-	-
	Increase / (decrease) in trade and other payables and accruals	81,978	(1,402,164)	88,853	(1,023,212)
	Increase / (decrease) in provisions	109,222	(101,737)	109,222	(101,737)
	Cash flow from operations	(827,802)	(2,452,035)	(758,031)	(1,553,178)

NOTE 26: SHARE-BASED PAYMENTS

The fair value of employee shares granted by ABM Resources NL is recognised as an expense with a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which the share holder becomes unconditionally entitled to the shares. The fair value at grant date is determined by the market value of the shares at issue date.

No options were granted during the financial year.

63

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 26: Share-Based Payments cont’d.

Employee Share Option Arrangement

There were no option agreements at reporting date.

Superannuation Plan

The Parent Entity uses Spectrum Super as their default Superannuation Fund and makes contributions to accumulation funds nominated by the employees.

NOTE 27: EVENTS AFTER THE BALANCE SHEET DATE

ABM has secured 70% of interest in the Erayinia JV, has sold the Binneringie and Mt Deans tenements, signed a MOU with Kunlun International, entered into a partnership agreement to secure prospective mineral tenements in Western Australia, dissolved the 100% owned subsidiary Broad Arrow Mill Pty Ltd and signed a farm in agreement in relation to its three Gascoyne tenements.

NOTE 28: RELATED PARTY TRANSACTIONS

Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

Transactions with related parties:

(a) Controlled Entities

During the year loan transactions occurred between the parent entity and its wholly owned subsidiaries.

Loans to subsidiaries - Beginning of the year - Loans advanced - Loan Repayments received - End of year	Economic Entity Parent Entity 2007 2006 2007 2006 $ $ $ $ - - 11,090,226 10,290,808 - - 309,877 1,223,664 - - (715,744) (424,246)
	- - 10,684,359 11,090,226

(b) Director-related Entities

(i) Loans

A loan agreement was entered into between Rexfam Consulting (a company associated with Mr Timothy King, former Chairman of the economic entity) and the economic entity in 2006. Details of this loan are set out in Notes 6(i). The loan was repaid during the 2006 financial year.

64

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 28: Director-related Entities cont’d.

(ii) Provision of Services

Ms M Kins, daughter of Mr Imants Kins, was paid $2,919 as remuneration for services rendered to the economic entity during the year.

NOTE 29: FINANCIAL INSTRUMENTS

(a) Financial Risk Management

The economic entity’s financial instruments consist mainly of deposits with banks, local money market instruments, short-term investments, accounts receivable and payable, loans to and from subsidiaries, bills, leases, preference shares and derivatives.

The main purpose of non-derivative financial instruments is to raise finance for economic entity operations.

(i) Treasury Risk Management

The board analyses currency and interest rate exposure and evaluates treasury management strategies in the context of the most recent economic conditions and forecasts when appropriate during regular board meeting.

(ii) Financial Risks

The main risks the economic entity is exposed to through its financial instruments are interest rate risk, foreign currency risk, liquidity risk, credit risk and price risk.

Interest rate risk

Interest rate risk for the economic entity is considered to be minimal. The economic entity had no interest attracting debts at 30 June 2007 and assets are managed with a mixture of short term and at call investments. For further details on interest rate risk refer to Note 29(b).

Foreign currency risk

The economic entity is exposed to fluctuations in foreign currencies arising from the sale of goods and services in currencies other than the economic entity’s measurement currency. The foreign currency risk for the economic entity is considered to be minimal.

Liquidity risk

The economic entity manages liquidity risk by monitoring forecast cash flows and ensuring that adequate funds are available.

The economic entity does not have any material credit risk exposure to any single receivable or economic entity of receivables under financial instruments entered into by the economic entity.

65

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 29: Financial Risk Management cont’d.

Price risk

The economic entity is exposed to commodity price risk through its commodity exploration and production and trading operations. Following the strategic review the economic entity has withdrawn from its tantalum trading and Australian tantalum exploration operations. The Company continues to be exposed to commodity price risk linked to its exploration activities, which are currently base metals, precious metals and uranium.

(b) Interest Rate Risk

The economic entity's exposure to interest rate risk, which is the risk that a financial instrument's value will fluctuate as a result of changes in market interest rates and the effective weighted average interest rates on classes of financial assets and financial liabilities, is as follows:

	Weighted	Weighted			Fixed Interest Rate	Fixed Interest Rate	Fixed Interest Rate	Maturing
	Average Effective					1 to 5		Over 5
	Interest Rate		Floating Interest Rate		Within Year	Years		Years		Non-interest	Bearing	Total
		%	$		$	$		$		$		$
	2007	2006	2007	2006	2007 2006	2007 2006		2007 2006		2007	2006	2007	2006
Financial Assets:
Cash	7.86	3.05	4,285,002	1,427,969	- -	-	-	-	-	-	-	4,285,002	1,427,969
Receivables	-	-	-	-	- -	-	-	-	-	19,396	57,585	19.396	57,585
Total Financial Assets	-	-	4,285,002	1,427,969	- -	-	-	-	-	4,304,398	57,585	4.304.398	1,485,554
Financial Liabilities:
Payables	-	-	-	-	- -	-	-	-	-	307,923	226,174	307.923	226,174
Interest bearing liabilities	-	3.94	-	-	- 9,318	-	-	-	-	-	-	-	9,318
Total Financial Liabilities	-	-	-	-	- 9,318	-	-	-	-	307,923	226,174	307,923	235,492

(c) Credit Risk

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets is the carrying amount, net of any provisions for doubtful debts of those assets, as disclosed in the statement of financial position and notes to the financial statements.

The economic entity does not have any material credit risk exposure to any single debtor or economic entity of debtors under financial instruments entered into by the economic entity.

(d) Net Fair Values

The net fair value for listed investments has been valued at the quoted market bid price at balance date. For unlisted investments where there is no organised financial market the net fair value has been based on a reasonable estimation of the underlying net assets of the investment.

66

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

NOTE 29: Net Fair Values cont’d.

For financial assets and other assets and liabilities the net fair value approximates their carrying value.

No financial assets and financial liabilities are readily traded on organised markets in standardised form other than listed investments.

NOTE 30: COMPANY DETAILS

The registered office of the parent entity is:

ABM Resources NL 141 Broadway Nedlands WA 6009

The principal place of business is:

ABM Resources NL 141 Broadway Nedlands WA 6009

67

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

DIRECTORS’ DECLARATION

The directors of the parent entity declare that:

1. the financial statements and notes, as set out on pages 30 to 67 are in accordance with the Corporations Act 2001:

2. (a) comply with Accounting Standards and the Corporations Regulations 2001; and

3. (b) give a true and fair view of the financial position as at 30 June 2007 and of the performance for the year ended on that date of the parent entity and economic entity;

4. the Executive Chairman and the Chief Financial Officer of the economic entity have each declared that:

5. (a) the financial records of the economic entity for the financial year have been properly maintained in accordance with section 286 of the Corporations Act 2001;

6. (b) the financial statements and notes for the financial year comply with the Accounting Standards; and

7. (c) the financial statements and notes for the financial year give a true and fair view.

8. in the directors’ opinion there are reasonable grounds to believe that the economic entity will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors.

Dated this 27[th] day of September 2007.

==> picture [95 x 59] intentionally omitted <==

Imants Kins Executive Chairman

68

BDO Kendalls Audit & Assurance (WA) 128 Hay Street SUBIACO WA 6008 PO Box 700 WEST PERTH WA 6872 Phone 61 8 9380 8400 Fax 61 8 9380 8499 aa.perth@bdo.com.au www.bdo.com.au

==> picture [143 x 30] intentionally omitted <==

ABN 90 360 101 594

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ABM RESOURCES NL

We have audited the accompanying financial report of ABM Resources NL, which comprises the balance sheet as at 30 June 2007, and the income statement, statement of changes in equity and cash flow statement for the year ended on that date, a summary of significant accounting policies, other explanatory notes and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year.

We have also audited the remuneration disclosures contained in the directors’ report. As permitted by the Corporations Regulations 2001, the consolidated entity has disclosed information about the remuneration of directors and executives (“remuneration disclosures”), required by Accounting Standard AASB 124 Related Party Disclosures, under the heading “Remuneration Report” in pages 18 to 22 of the directors’ report and not in the financial report.

Directors’ Responsibility for the Financial Report and the AASB 124 Remuneration Disclosures Contained in the Directors’ Report

The directors of the company are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001 . This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that compliance with the Australian equivalents to International Financial Reporting Standards ensures that the financial report, comprising the consolidated and parent financial statements and notes, comply with International Financial Reporting Standards.

The directors of the company are also responsible for the remuneration disclosures contained in the directors’ report.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. Our responsibility is to also express an opinion on the remuneration disclosures contained in the directors’ report based on our audit.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report and the remuneration disclosures contained in the directors’ report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report and the remuneration disclosures contained in the directors’ report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report and the remuneration disclosures contained in the directors’ report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report and the remuneration disclosures contained in the directors’ report.

BDO Kendalls is a national association of separate partnerships and entities

==> picture [114 x 22] intentionally omitted <==

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , provided to the directors of ABM Resources NL on 27 September 2007, would be in the same terms if provided to the directors as at the date of this auditor’s report.

Auditor’s Opinion on the Financial Report

In our opinion:

• (a) the financial report of ABM Resources NL is in accordance with the Corporations Act 2001 , including:

• (i) giving a true and fair view of the company’s and consolidated entity’s financial position as at 30 June 2007 and of its performance for the year ended on that date; and

• (ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001 ; and

• (b) the consolidated and notes or financial report also comply with International Financial Reporting Standards as disclosed in Note 1.

Auditor’s Opinion on the AASB 124 Remuneration Disclosures Contained in the Directors’ Report

In our opinion the remuneration disclosures that are contained in pages 18 to 22 of the directors’ report comply with Accounting Standard AASB 124.

BDO Kendalls Audit & Assurance (WA) (formerly BDO)

==> picture [86 x 78] intentionally omitted <==

BG McVeigh

Partner

Perth, Western Australia Dated this 27[th] day of September 2007

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

Additional information required by the Australian Securities Exchange Limited and not shown elsewhere in this report is set out below. The information was prepared based on share registry information processed up to 25 September 2007.

1. Shareholdings:

(a) Distribution of Shareholders

Size of holding category (number of shares held) 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and over	Number of Holders Ordinary Shares 26 132 233 1,044 417
	1,852

(b) The number of shareholders holding less than a marketable parcel is 82.

• (c) The names of the substantial shareholders listed in the holding Company’s register are:

are:
	Number of	% Held of Issued
Shareholder	Ordinary shares	Ordinary Capital
Firebird Global Master Fund	55,710,704	11.13
Oceanic Asset Management Pty Ltd	47,004,819	9.39
Timothy King and controlled entities	36,254,158	7.24

(d) Voting Rights

The voting rights attached to each class of equity security are as follows:

Ordinary shares

• Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has one vote on a show of hands.

71

ABM RESOURCES NL ABN 58 009 127 020 AND CONTROLLED ENTITIES

ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

• (e) 20 Largest Shareholders – Ordinary Shares

Name 1. Citicorp Nominees Pty Ltd 2. HSBC Custody Nominees 3. Rexfam Consulting Pty Ltd 4. HSC Custody Nom Sydney 5. Firebird Global Master Fund 6. ANZ Nominees Ltd 7. Jemaya Pty Ltd 8. Fotios, Michael George 9. King, Timothy John 10. Ravina Ltd 11. Firebird Global Master Fund 12. Perth Select Seafoods Pty Ltd 13. Filmrim Pty Ltd 14. Kins, Imants 15. Deauville Inv Pty Ltd 16. Notegrin Pty Ltd 17. Austminex NL 18. Fakuba Pty Ltd 19. Hepburn, IM & RF 20. Bruges Pty Ltd

Number of Ordinary Fully Paid Shares Held % Held of Issued Ordinary Capital 40,281,904 8.05 33,536,479 6.70 18,881,667 3.77 15,000,000 3.00 15,000,000 3.00 14,122,990 2.82 14,050,000 2.81 12,481,055 2.49 12,366,241 2.47 11,000,000 2.20 10,000,000 2.00 7,599,054 1.52 7,400,000 1.48 6,500,000 1.30 6,000,000 1.20 6,000,000 1.20 5,836,666 1.17 5,570,000 1.11 5,100,000 1.02 5,030,654 1.00

251,756,710 50.31

2. The name of the Company Secretary is Jutta Zimmermann.

3. The address of the principal registered office in Australia is 141 Broadway, Nedlands, WA, 6009. Telephone: (08) 9423 9777

4. Registers of securities are held at the following addresses:

• Western Australia Security Transfer Registrars Pty Ltd, 770 Canning Highway, Applecross, WA, 6153.

5. Stock Exchange Listing:

Quotation has been granted for all the ordinary shares of the Company on all Member Exchanges of the Australian Securities Exchange Limited.

6. Unquoted Securities:

• None

72