SCIDEV LTD — Interim / Quarterly Report 2012

Feb 28, 2012

ABN 25 001 150 849

P.O. Box 1507 North Sydney NSW 2059 Level 3, 2 Elizabeth Plaza North Sydney NSW 2060 Australia

Phone: (+61 2) 9954 7888 Fax: (+61 2) 8904 0334 Email: mail@intec.com.au Website: www.intec.com.au ASX code: INL

HALF-YEARLY REPORT

31 DECEMBER 2011

Corporate Directory

Trevor A Jones (Chairman and Non-executive Director) Boardroom Pty Limited Kieran G Rodgers (Managing Director) Level 7, 207 Kent Street James R G Bell (Non-executive Director) Sydney NSW 2000 Australia

Group Company Secretaries Sydney NSW 2001 Australia

Senior Management

David W Clark (Financial Controller) Dave L Sammut (Corporate Development Manager) Griffith Hack Andrew R Tong (Head of Technology) 100 Miller Street Adam J Randall (General Manager – Tasmania) North Sydney NSW 2060 Australia

P.O. Box 1507 North Sydney NSW 2060 Australia the Deutsche Börse (Code: INF); Facsimile: (+61 2) 8904 0334 The OTC Markets (Code: ICLJY) Email: mail@intec.com.au Website: www.intec.com.au Auditor

P.O. Box 666 Sydney NSW 2000 Australia 10-12 River Road Burnie TAS 7320 Australia Legal Adviser Telephone: (+61 3) 6431 9867 Facsimile: (+61 3) 6431 3629 Allens Arthur Robinson

20 River Road Burnie TAS 7320 Australia

Directors Share Registry

PO Box 3993 Telephone: (+61 2) 9290 9600 Robert J Waring Facsimile: (+61 2) 9279 0664 David W Clark Email: enquiries@boardroomlimited.com.au Website: www.boardroomlimited.com.au

Patent Attorney

Principal Registered Office Stock Exchange Listings and Trading Platform Listings

North Sydney NSW 2059 Australia Intec Ltd shares are listed or traded on: Level 3, 2 Elizabeth Plaza the Australian Securities Exchange (Code: INL); Telephone: (+61 2) 9954 7888 and as American Depository Receipts on:

Tasmanian Office Crowe Horwath Sydney 309 Kent Street

Level 28, Deutsche Bank Place Burnie Research Facility Corner of Hunter and Phillip Streets Sydney NSW 2000 Australia

Contents Page

Directors' report	4-5
Consolidated condensed statement of comprehensive income	6
Consolidated condensed statement of financial position	7
Consolidated condensed statement of changes in equity	8
Consolidated condensed statement of cash flows	9
Notes to the financial statements	10-12
Directors' declaration	13
Independent review report	14-15
Auditor's independence declaration	16

DIRECTORS' REPORT

Your Directors present their report on the consolidated entity consisting of Intec Ltd (Intec or the Company) and the entities it controlled (the Group) for the half-year ended 31 December 2011.

Directors

The names of the Company's Directors in office during the half-year and until the date of this report are set out below.

Trevor A Jones	Chairman and Non-executive Director
Kieran G Rodgers	Managing Director
Philip R Wood	Managing Director and Chief Executive Officer (resigned 6 February, 2012)
James R G Bell	Non-executive Director
A John Moyes	Non-executive Director (resigned 21 November, 2011)

Review of Operations

The Group incurred a loss after providing for income tax for the half-year to 31 December 2011 of $3,272,000 (2010 – profit $2,825,000).

Revenues from operations were generated from the low-grade zinc blending projects conducted in Tasmania and Victoria, interest on environmental bonds and other minor sources.

The Group incurred net cash outflows from operations of $2,412,000 for the half-year ended 31 December 2011. As of balance date, the Group had net assets of $5,212,000 and cash balances of $288,000.

Operational Activities

Low-Grade Zinc Blending Project

Intec continued to produce a low-grade zinc-bearing product for export, which is produced from blending zinc-bearing slag material sourced from Zeehan with electric arc furnace (EAF) dust from the Group's stockpiles.

The processing of the Tasmanian EAF dust stockpile was completed during the half-year and currently a standard environmental site assessment is in progress at Hellyer, prior to the final and formal demobilisation of Intec's activities at the Hellyer site. It is expected that all EPA Tasmania approvals will be received and that the balance of the Tasmanian environmental bond will be released accordingly.

Production and shipment of a blended product using EAF dust from the Victorian stockpile commenced during December 2011. This operation is on-going and to date approximately 45% of the Victorian EAF dust stockpile has been reclaimed, blended with Zeehan sourced material and exported. Operations are expected to continue until completion in the middle of 2012.

Rare Earth Metals

Intec is currently examining the possibility of converting the Burnie Research Facility for the recycling of an industrial waste containing appreciable levels of neodymium (Nd) and dysprosium (Dy). These two rare earth metals are used extensively in electronic applications, most particularly in high-strength NdFeB (neodymium iron boron) permanent magnets, such as those used in electric vehicles and wind power turbines.

Throughout the December 2011 quarter, the Intec R.E.cycling Project was progressed in two main areas: engineering considerations for the potential application of the process to the existing infrastructure at Burnie; and the purification and separation of higher-grade products (>95%) via a development programme at the CSIRO. This programme is expected to continue throughout the remainder of the 2011-2012 financial year. This work is being partially supported by funding from the Federal Government's Researchers in Business Programme.

Spent Pickle Liquor Recycling Project

Intec finalised the reporting from Phase 2 of the project (demonstration plant operations at Burnie). This report included a life cycle analysis of the proposed technology, preliminary marketing of the iron oxide and calcium sulphate products, a detailed mass and energy balance, and a ±10% capital and operating cost model for the implementation of a treatment plant at GBG's site in Dandenong, Victoria. The project proposal is currently being evaluated by both Intec management and GBG, and requires further study and analysis before an implementation decision can be made. An announcement regarding this project will be made as soon as practicably possible.

IRC Project

The IRC Project in the Islamic Republic of Iran continued to advance at the corporate level throughout 2011. An agreement was signed between the client and Intec's 50% owned subsidiary Intec International Projects Pty Ltd (IIP) in October 2011, resulting in the formal commencement of the IRC Project in January 2012.

Intec Gold Process

During the half-year, the Company completed preliminary testwork on three refractory gold feedstocks as part of a mutual technology assessment program: arsenopyrite, arsenopyrite-pyrite and pyrite-carbon. These trials were successful in respect of the first two samples, with 90-95% of the gold extracted.

Further laboratory testwork took place at an independent laboratory in Denver during February. The independent laboratory is currently compiling a report on the testwork program and following receipt of the report, expected by the end of the March quarter, Intec's potential collaboration partner has 60 days in which to consider whether to assist Intec in the commercialisation of the Intec Gold Process on terms to be agreed.

Hellyer Royalty

The Group holds a 100% interest in the Hellyer royalty, which is a unit-based royalty payable by Bass Metals Limited (BSM) based on tonnes of ore processed through the Hellyer Mill. As a result of participating in the 2011 BSM rights issue, Intec has foregone cash royalty payments in relation to completed and anticipated minerals processing until the end of calendar 2011 at the Hellyer Mill, in exchange for receiving 3,100,000 BSM shares at $0.15 per share (each with a free attached 3-year listed option exercisable at $0.20).

The nominal face value of these foregone 2011 royalty payments has been fractionally discounted to the $465,000 investment amount, with ensuing royalties of $3.50 per tonne of ore processed to a $5.725 million maximum (inclusive of actual and foregone royalties). The non-current assets of the Group include an amount of $2,207,994 representing a valuation of the Hellyer royalty.

Events Occurring After The Reporting Date

As announced on 7 February 2012, Intec received commitments to raise A$1.25 million through a share placement of 83.333 million fully paid ordinary shares in the capital of the Company at 1.5 cents per share. Of the total Placement amount, 32.473 million shares ($487,092) were allotted on 8 February under the Company's available 15% placement capacity pursuant to ASX Listing Rule 7.1. Shareholder approval will be sought for the remaining 50.861 million Placement shares ($762,908), including a separate approval for the participation in the Placement in the amount of $220,000 by Mr Kieran Rodgers, a director of the Company. The required approvals will be sought at an Extraordinary General Meeting of Shareholders to be held on 19 March 2012. Concurrently with the Placement, Mr Kieran Rodgers, previously the Finance Director & Chief Financial Officer, replaced Mr Philip Wood as Managing Director of the Company. Mr Wood was paid his contractual employee entitlements as per his Service Agreement, the terms of which were disclosed in the 2011 Annual Report.

A separate announcement released on 30 January 2012 provides a full update on the IRC Project, inclusive of a payment of approximately A$1.4 million which has now been received by IIP for work that has already commenced.

On 25 January, BSM announced suspension of trading in its listed securities on ASX. This suspension remains in place pending further announcements by BSM.

No other events have occurred subsequent to 31 December 2011 requiring disclosure in, or amendment to, these interim financial statements.

Rounding of Amounts

The Company is of a kind referred to in Class Order 98/100, issued by the Australian Securities and Investments Commission, relating to the "rounding off" of amounts in the Directors' report. Amounts in the Directors' report have been rounded off in accordance with the Class Order to the nearest thousand dollars, or in certain cases, to the nearest dollar.

Auditor's Independence Declaration

An independence declaration from Intec's auditor, Crowe Horwath Sydney is included on page 16 of the financial report. This report is made in accordance with a resolution of the Company's Directors.

Kieran G. Rodgers Managing Director Sydney

29 February 2012

CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

	Half-year
	31 December 2011	31 December 2010
	$'000	$'000
Revenue from continuing operations	597	806
Other income	-	5,000
Administration expense	(299)	(243)
Bad and Doubtful Debts expense	-	(1)
Demonstration plant expenses	(145)	(49)
Depreciation and amortisation expense	(428)	(404)
Employee benefits expense	(1,267)	(1,356)
Engineering and other consultants expenses	(96)	(272)
Finance costs	(20)	(39)
Impairments expense	(139)	-
Metals Recovery Costs	(1,227)	-
Occupancy expense	(174)	(188)
Research and development expenses	(20)	(416)
Other expenses	(54)	(13)
Profit/(loss) before income tax	(3,272)	2,825
Income tax expense/(benefit)	-	-
Profit/(loss) for the half-year	(3,272)	2,825
Other comprehensive income/(loss)	-	-
Income tax relating to components of other comprehensive income	-	-
Other comprehensive income/(loss) for the period net of income tax	-	-
Total comprehensive income/(loss) for the period	(3,272)	2,825
Profit/(loss) is attributable to:
Owners of Intec Ltd	(3,322)	2,825
Non-controlling interests	50	-
	(3,272)	2,825
Basic Earnings per share (cents per share)	(1.51)	1.85
Diluted Earnings per share (cents per share)	(1.51)	1.85

CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2011

Current assets	Notes	31 December 2011	30 June 2011
		$'000	$'000
Cash and cash equivalents		288	2,557
Trade and other receivables		1,524	911
Environmental bonds		331	567
Inventories		42	43
Other current assets	4	627	-
Total current assets		2,812	4,078
Non-current assets
Trade and other receivables	5	2,369	2,919
Other financial assets	5	353	28
Plant and equipment	6	2,516	2,701
Environmental bonds	7	3,648	3,660
Intangible assets		10	10
Total non-current assets		8,896	9,318
Total assets		11,708	13,396
Current liabilities
Trade and other payables		1,015	1,169
Deferred revenue	8	1,400	-
Provisions	7	4,045	3,769
Total current liabilities		6,460	4,938
Non-current liabilities
Provisions		36	21
Total non-current liabilities		36	21
Total liabilities		6,496	4,959
Net assets		5,212	8,437
Equity
Contributed equity		70,416	70,416
Reserves		2,624	2,577
Accumulated losses		(67,878)	(64,556)
Total equity attributable to equity holders of the Company		5,162	8,437
Non-controlling interest		50	-
Total equity		5,212	8,437

CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

	ContributedEquity$'000	Reserves$'000	AccumulatedLosses$'000	Non ControllingInterest$'000	Total$'000
Balance at 1 July 2010Total comprehensive income	68,979	2,577	(66,081)	-	5,475
for the periodShares issued during the period,	-	-	2,825	-	2,825
net of transaction costs	1,439	-	-	-	1,439
Balance at 31 December 2010	70,418	2,577	(63,256)	-	9,739
	$'000	$'000	$'000	$'000	$'000
Balance at 1 July 2011	70,416	2,577	(64,556)	-	8,437
Employee options grantedTotal comprehensive income	-	47	-	-	47
for the period	-	-	(3,322)	50	(3,272)
Balance at 31 December 2011	70,416	2,624	(67,878)	50	5,212

CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

	Half-year
	31 December 2011$'000	31 December 2010$'000
Cash flows from operating activities
Receipts from customers	1,067	563
Payment to suppliers and employees	(3,705)	(2,516)
Interest paid	(19)	(33)
Interest received	148	90
Other income	97	5,005
Net cash (outflows)/inflows from operating activities	(2,412)	3,109
Cash flows from investing activities
Acquisition of plant and equipment	(240)	(55)
Proceeds from security deposits refunded	383	-
Purchase of shares in unlisted company	-	(1)
Security deposits paid	-	(45)
Net cash (outflows)/inflows from investing activities	143	(101)
Cash flows from financing activities
Proceeds from issue of shares	-	1,484
Repayment of borrowings	-	(540)
Share issue costs	-	(45)
Net cash inflows/(outflows) from financing activities	-	899
Net increase/(decrease) in cash held	(2,269)	3,907
Cash at the beginning of the financial period	2,557	192
Cash at the end of the financial period	288	4,099

The half-year financial report should be read in conjunction with the Annual Financial Report of Intec as at 30 June 2011. It is also recommended that the half-year financial report be considered together with any public announcements made by Intec during the halfyear ended 31 December 2011 in accordance with the continuous disclosure obligations arising under the Corporations Act 2001.

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1: BASIS OF PREPARATION OF THE HALF-YEAR FINANCIAL REPORT

This condensed consolidated financial report for the half-year to 31 December 2011 is a general-purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001, Accounting Standard AASB 134 "Interim Financial Reporting" and other mandatory professional reporting requirements.

For the purpose of preparing the half-year financial report, the half-year has been treated as a discrete reporting period.

The half-year financial report does not include all notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the Group as the full financial report.

Significant Accounting Policies Adopted During The Half-Year

No significant accounting policies have been adopted in the current half year.

The accounting policies are consistent with those of the previous financial year.

Revenue from continuing operations of $597,000 are shown in the following table:

Revenue from continuing operations	31 December 2011	31 December 2010
	$'000	$'000
Technical income	30	613
Sale of blended zinc product	416	-
Interest received	129	102
Foreign currency exchange gain/(loss)	20	(12)
Other income	2	103
Total revenue from continuing operations	597	806

Revenues from operations were generated from the low-grade zinc blending projects conducted in Tasmania and Victoria, interest on environmental bonds and other minor sources.

Going Concern Basis

The Group's budget forecast for the period to 31 March 2013 indicate that the Group will have sufficient cash resources to continue to operate for the next twelve (12) months. However, Directors and management will continue to monitor cash flows and will consider the timing of further capital requirements as and when required in order for the Group to meet its business objectives. Accordingly, the Directors have prepared the interim financial statements on a going concern basis.

NOTE 2: EQUITY SECURITIES ISSUED

		Half-year	Half-year
	2011Shares	2010Shares	2011$'000	2010$'000
Issue of ordinary shares during the half-year:
Exercise of options	-	-	-	-
Issue of ordinary shares	-	25,000,000	-	750
Issue of ordinary shares from the conversion of the La Jolla	-		-
Cove Investors Inc. Convertible Note		84,897,389		734
Transaction costs relating to share issues	-	-	-	(45)
	-	109,897,389	-	1,439

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 3: SEGMENT INFORMATION

The Group currently operates in one business segment. However, a discontinued operation relating to previous activities at the Hellyer Minesite does have a continuing impact on the financial statements; refer Note 5 – Trade and Other Receivables/Other Financial Assets.

NOTE 4: OTHER CURRENT ASSETS

Other current assets refer to a prepayment due on commencement of the IRC Project in 2012. Refer to Note 8 Deferred Revenue for further information.

NOTE 5: TRADE AND OTHER RECEIVABLES/OTHER FINANCIAL ASSETS

The Group holds a 100% interest in the Hellyer royalty, which is a unit-based royalty payable at the rate of $3.50 per tonne of ore processed through the Hellyer Mill to a cumulative maximum payment amount of $5,725,000. Previously the royalty was payable at the rate of $2.50 per tonne processed to a cumulative maximum payment amount of $5,000,000.

As a result of participating in the 2011 BSM rights issue, the Group forwent cash royalty payments in relation to completed and anticipated minerals processing activities until the end of calendar 2011 at the Hellyer Mill, in exchange for receiving 3,100,000 BSM shares at $0.15 per share (each with a free attached 3-year listed option exercisable at $0.20). The nominal face value of these foregone 2011 royalty payments has been fractionally discounted to the $465,000 investment amount, with ensuing royalties of $3.50 per tonne of ore processed to a $5.725 million maximum amount (inclusive of foregone royalties).

The closing market price at 31 December 2011 of BSM shares was 8 cents and the BSM options were 2.5 cents valuing the Group's holding at $326,000 (3,100,000 shares at 8 cents/share and 3,100,000 options at 2.5 cents/option). An impairments expense of $139,000 was therefore raised against the BSM investment book value of $465,000.

The non-current trade and other receivables of the Group include an amount of $2,208,000 representing a valuation of the Hellyer royalty.

NOTE 6: PLANT & EQUIPMENT

Burnie Research Facility

The carrying value of the Burnie Research Facility is $2,064,157 at 31 December 2011. The Directors consider that no adjustment is currently necessary to the carrying value of the Burnie Research Facility at 31 December 2011.

NOTE 7: ENVIRONMENTAL BONDS

The Group has a significant remaining stockpile of EAF dust at the Footscray, Victoria storage facility. The Group has lodged a cash backed environmental bond amounting to $3,647,500 in relation to this stockpile and the total bond amount is listed as a non current asset in the balance sheet. A separate environmental bond of $331,000 is also lodged with the Tasmanian Government in respect of a prior stockpile of EAF dust at the Hellyer Minesite. The Tasmanian bond is classified as a current asset.

The Directors consider that a current provision of $3,647,500 equivalent to the full amount of the environmental bond lodged in relation to the Victorian EAF dust stockpile remains appropriate. There is no provision raised against the Tasmanian bond.

NOTE 8: DEFERRED REVENUE

Deferred revenue refers to the recognition of the initial payment due on commencement of the IRC Project for which payment of $1.4 million was received on 30 January 2012.

NOTE 9: CONTINGENT ASSETS AND LIABILITIES

Since the last annual reporting date, there has been no change in any contingent liabilities or contingent assets.

NOTE 10: EVENTS OCCURING AFTER REPORTING DATE

As announced on 7 February 2012, Intec received commitments to raise A$1.25 million through a share placement of 83.333 million fully paid ordinary shares in the capital of the Company at 1.5 cents per share. Of the total Placement amount, 32.473 million shares ($487,092) were allotted on 8 February under the Company's available 15% placement capacity pursuant to ASX Listing Rule 7.1. Shareholder approval will be sought for the remaining 50.861 million Placement shares ($762,908), including a separate approval for the participation in the Placement in the amount of $220,000 by Mr Kieran Rodgers, a director of the Company.

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

The required approvals will be sought at an Extraordinary General Meeting of Shareholders to be held on 19 March 2012.

Concurrently with the Placement, Mr Kieran Rodgers, previously the Finance Director & Chief Financial Officer, replaced Mr Philip Wood as Managing Director of the Company. Mr Wood was paid his contractual employee entitlements as per his Service Agreement, the terms of which were disclosed in the 2011 Annual Report.

A separate announcement released on 30 January 2012 provides a full update on the IRC Project, inclusive of a payment of approximately A$1.4 million which has now been received by IIP for work that commenced in 2012.

On 25 January, BSM announced suspension of trading in its listed securities on ASX. This suspension remains in place pending further announcements by BSM.

No other events have occurred subsequent to 31 December 2011 requiring disclosure in, or amendment to, these interim financial statements.

NOTE 11: SHARE BASED PAYMENTS

At the 2011 Annual General Meeting held on 21 November 2011, 3,800,000 share options were granted to the directors under the Intec Option Plan to take up ordinary shares at an exercise price of $0.03 each. The options are exercisable on or before 21 November 2016. The options hold no voting or dividends rights and are not transferable.

Set out below is a summary of options granted to the directors at the Annual General Meeting:

Executive Directors	Number of Options	Value
		$
Philip R Wood	1,400,000	17,080
Kieran G Rodgers	1,200,000	14,640
	2,600,000	31,720
Non Executive Directors
A John Moyes	500,000	6,100
Trevor A Jones	400,000	4,880
James RG Bell	300,000	3,660
	1,200,000	14,640
Total	3,800,000	46,360

NOTE 12: ACCOUNTING STANDARDS ISSUED BUT NOT YET APPLIED BY THE ENTITY

In December 2009, the ASSB issued AASB 9 Financial Instruments which addresses the classification and measurement of financial assets and is likely to affect the Group's accounting for its financial assets. The standard is not applicable until 1 January 2013 but is available for early adoption, but the Group has not yet done so.

DIRECTORS' DECLARATION

In the Directors' opinion:

• (a) the financial statements and notes set out on pages 6 to 12 are in accordance with the Corporations Act 2001, including:
  • (i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements ; and
  • (ii) giving a true and fair view of the Group's financial position as at 31 December 2011 and of its performance for the half-year ended on that date; and
  • (b) there are reasonable grounds to believe that the Group 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 Directors of Intec Ltd.

On behalf of the Board

Kieran G. Rodgers Managing Director Sydney

29 February 2012

INTEC LIMITED ABN 25 001 150 849

INDEPENDENT AUDITOR'S REVIEW REPORT TO THE MEMBERS OF INTEC LIMITED

Report on the Half-vear Financial Report

We have reviewed the accompanying half-year financial report of Intec Limited and its Controlled Entities (the group) which comprises the consolidated condensed statement of financial position as at 31 December 2011, the consolidated condensed statement of comprehensive income, consolidated condensed statement of changes in equity, consolidated condensed statement of cash flows for the half-year ended on that date, selected explanatory notes and the directors' declaration for the group.

Directors' Responsibility for the Half-Year Financial Report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410: Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the group's financial position as at 31 December 2011 and its performance for the half-year ended on that date, and complying with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Regulations 2001. As the auditor of the company, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

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

Matters Relating to Electronic Publication of the Audited Financial Report

This review report relates to the financial report of the group for the half-year ended 31 December 2011 included on the website of Intec Limited. The directors of the company are responsible for the integrity of the website and we have not been engaged to report on its integrity. This review report refers only to the subject matter described above. It does not provide an opinion on any other information which may have been hyperlinked to or from the financial report. If users of the financial report are concerned with the inherent risk arising from publication on a website, they are advised to refer to the hard copy of the reviewed financial report to confirm the information contained in this website version of the financial report.

Liability limited by a scheme approved under Professional Standards Legislation

Crowe Horwath Sydney Pty Ltd is a member of Crowe Horwath International, a Swiss verein.Each member firm of Crowe Horwath is a separate and independent legal entity.

Crowe Horwath Sydney ABN 97 895 683 573Member Crowe Horwath

Level 15 309 Kent StreetSydney NSW 2000 AustraliaTel +61 2 9262 2155 Fax +61 2 9262 2190 ww.crowehorwath.com.au

A WHK Group Firm

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001. We confirm that the independence declaration required by the Corporations Act 2011, which has been given to the directors of the group, would be in the same terms if provided to the directors as at the time of this auditor's review report.

Qualification

The Burnie Research Facility has a carrying value of $2,063,952 as at 31 December 2011 (30 June 2011: $2,420,626). We were unable to obtain sufficient appropriate audit evidence regarding the recoverable value of this facility.

The group has recognised an environmental provision, the balance being $3,647,500 as at 31 December 2011 (30 June 2011: $3,647,500). The provision is recognised to cover any make good required on the EAFD stockpiles at the Footscray site. The group has started the disposal of the EAFD stockpiles and is intending to continue the disposal until it is completely cleared. However at reporting date we were unable to obtain sufficient appropriate audit evidence regarding the completeness of potential liabilities outstanding as they dispose the EAFD stockpiles.

Other financial assets include $2,207,994 (30 June 2011: $2,765,319) that represents contingent consideration from the sale of Hellyer assets to Bass Metals Limited. The group adopted the valuation performed by the purchaser of the Hellyer assets (less: received income) which was stated in the purchaser's 2009 financial statements. We were unable to obtain sufficient appropriate audit evidence to form an opinion on the the value of the royalty adopted by the group.

Conclusion

Based on our review, which is not an audit, except for the effect of the matters referred to above we have not become aware of any matter that makes us believe that the half-year financial report of the group is not in accordance with the Corporations Act 2001 including:

• (i) giving a true and fair view of the group's financial position as at 31 December 2011 and of its performance for the half-year ended on that date; and
• complying with Accounting Standard AASB 134: Interim Financial Reporting and the $(ii)$ Corporations Regulations 2001.

Emphasis of matter regarding the continuation as a going concern

Without further qualification to our opinion, we draw attention to Note 1 in the financial statements which comments on the requirement for further additional funding capital and/or revenue in the short term for the company and the group to continue meeting their obligations as and when they fall due. These conditions indicate that there is significant uncertainty about whether the group will continue as a going concern. At the time of these financial statements, the Directors of Intec Limited believe that the group will be able to pay its debts as and when they fall due and accordingly, have prepared the financial report on a going concern basis.

Crowe Horwath Sydney

CROWE HORWATH SYDNEY

Kunell-

LEAH RUSSELL Principal Dated this 29th day of February 2012

Crowe Horwath Sydney ABN 97 895 683 573Member Crowe Horwath International

Level 15 309 Kent Street Sydney NSW 2000 AustraliaTel +61 2 9262 2155Fax +61 2 9262 2190 www.crowehorwath.com.au

A WHK Group Firm

29 February 2012

The Board of Directors Intec Limited PO Box 1507 North Sydney NSW 2059

Dear Board Members

INTEC LIMITED AND CONTROLLED ENTITIES

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Intec Limited and Controlled Entities

As lead audit principal for the review of the half-year financial statements of Intec Limited and Controlled Entities for the half-year ended 31 December 2011, I declare that to the best of my knowledge and belief, that there have been no contraventions of:

• the auditor independence requirements of the Corporations Act 2001 in relation to the $(i)$ review; and
• $(ii)$ any applicable code of professional conduct in relation to the review.

Yours sincerely

Crowe Horwath Sydney

CROWE HORWATH SYDNEY

Dunell-

LEAH RUSSELL Principal

Liability limited by a scheme approved under Professional Standards Legislations

Crowe Horwath Sydney Pty Ltd is a member of Crowe Horwath International, a Swiss verein.Each member firm of Crowe Horwath is a separate and independent legal entity.

$-16-$