SUNSTONE METALS LTD — AGM Information 2008

Dec 4, 2008

AGM

David McSweeney – November 2008

Disclaimer

• Certain statements contained in this presentation, including information as to the future financial or operating performance of Avalon Minerals and its projects, are forward-looking statements. Such forward-looking statements:
  • • are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Avalon Minerals, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies; and
  • • Involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward-looking statements.
  • • May include, among other things, statements regarding targets, estimates and assumptions in respect of metal production and prices, operating costs and results, capital recovery rates, and are or may bebased on assumptions and estimates related to future technical, economic, market, political, social and other conditions;
  • • The words "believe", "expect", "anticipate", "indicate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", :may", "will", "schedule" and similar expressions identify forwardlooking statements.
• Avalon Minerals disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise.
• All forward-looking statements made in this presentation are qualified by the foregoing cautionary statements. Investors are cautioned that forward-looking statements are not guarantees of future performance and accordingly investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein.

Avalon Minerals Ltd – Corporate

Directors

David McSweeney Managing Director 20 years resource sector experience, founding Managing Director of Gindalbie Metals Ltd, non-executive Director – Bauxite Resources Ltd

Stephen Stone–Director

28 years experience, former Executive Chairman – Apex Minerals NL, Executive Chairman – Azumah Resources Ltd, Director –Encore Metals NL

Gary Steinepreis–Director

Chartered Accountant, Director – Black Fire Energy Ltd, Signature Brands Ltd, Norseman Gold Plc, RMG Limited, WAG Limited

Management

Des KellyCompany Secretary

Top Shareholders

David McSweeney 8,350,000

Greg Down, Don Boyer, Baracus, Brooks 9,930,000Overseas Institutional Investors 6,600,000Base Asia Pacific Limited 1,500,000Derek Steinepreis 1,330,000Craig Ian Burton 1,250,000Kimbriki Nominees 1,000,000Gary Steinepreis 750,000

Ordinary SharesHeld(8.5M Options)

AVALON MINERALS LTD

PROJECT OVERVIEW

Avalon Copper Projects

Sweden – Low Sovereign Risk

• Constitutional monarchy & parliamentary democracy
• Skilled mining labour force, 99% literacy, English as 2nd language
• Copper concentrators and smelters
• Legislation
  • Framework similar to Australia
• Environment
  • Primary liability rests with previous operators in old mining areas i.e. the Government
• Taxation
  • Normal corporate rate of income tax at 28%
  • Nominal 0.2% NSR on production

Sweden – Exploration Hot-Spot

Anglo American | Blackstone Ventures Inc | Boliden | Dragon Resources Ltd | Drake Resources Ltd | Aura Energy | Energy Ventures | Eagle Mining | International Gold Exploration | Kopparberg Mineral | Lappland Goldminers AB | Lundin Mining Corporation | Mawson Resources Ltd | Nordic Diamonds | Northland Resources Inc | Tertiary Minerals PLC | Zinifex Ltd | Independence Group

Viscaria Project Summary

67km2tenements

• Operated by Outokumpufrom 1982 to 1997
• Mined 12.5 Mt grading 2.3% Cu and 0.3g/t Au
• Produced 280,000t ofCu in concentrate@ 25% Cu

Photos – Ronnskar Smelter

Viscaria

History

• 12.3mt @ 2.3% Cu production from 1982-1997($1.5B at today's copper price)
• Phelps Dodge 2003-2008 (no activity)
• Avalon purchase March 2008
• May 2008 JORC 24.1mt @ .8% Cu B Zone
• May 2008 JORC 2.5mt @ 1.6% Cu D Zone
• July 2008 JORC 5.3mt @ 1.3% Cu A North Zone
• Sept 2008 JORC 8.2m @ 2.7% Cu A Zone South

Viscaria Showing Surface Mineral Resources

3 Parallel zones

ViiRAB&DZscaraesourcesones,
Zones	Eiitsngx	C%u
D	25tm	16%
B	24tm	8%
AZNhtoneor	35tm	12%
SAZhtoneou	82tm	2%7

Viscaria Showing Underground Mineral Resources

A Zone South - Targets

Viscaria A Zone North Long Section

Viscaria Sections ( A & B - Zone)

Viscaria Sections ( D - Zone)

A Zone South Long Section Block Model facing West

Grades; Magenta: >5.5% Cu, Red >3.0% Cu

A Zone South Long Section Block Model facing East

Showing decline and stope development in footwallGrades; Magenta: >5.5% Cu, Red >3.0% Cu

D Zone Block Model- Open

B Zone Block Model- Access from A Zone

Mining

• Studies Underway
  • Resource Models CSA.
  • Geological Models CSA.
  • Dewatering A Zone studies commenced.
  • Mine design consultants, Rapallo received resource models in mid September. These will form the basis of mining cost estimates, scoping level production and development schedules prior to a Bankable Feasibility Study.
  • Cost models (owner operator) being developed from first principles for use at Viscaria.
  • Underground mine design and plant infrastructure requirements are being assessed by Rapallo Engineers & MSP Engineers.

Production scenario - Viscaria

STAGE 1- 2011

• Plant Capacity Copper- 9000tpa
• NSR

Opex

• -300,000 tpa @3.0% Cu
• Concentrate 36000 t @ 25% Cu
• Copper price US $6000/t ( $2.7/lb)
  • US$45.3M/annum (US $1258.3/t concentrate)
    • US $900.0/t concentrate
• Capex US $30.0M

NOTE historical A Zone South shoots 1mt @ 7% Cu)

Infrastructure at Viscaria

Viscaria benefits from existing infrastructure–

• • 10km Decline and 20km of development drives – ($50m replacement cost)
• •Accommodation in Kiruna Town – (population 20,000)
• •House & office established at Kiruna
• •Hydro-grid power
• •Rail & road
• •Experienced workforce
• •Daily flights from Stockholm

Viscaria – Stage 1 Scenario

Mining

• Initial production (first 2 years) sourced from D Zone open cut and A Zone open cuts.
• Continuation of A Zone Mining was cut short by Outokumpu in 1997 due to copper price and Outokumpu corporate strategy.
• Undeveloped u/g ore positions identified with minimal access required from existing infrastructure.

Mining and Geology

Personnel & Infrastructure

• Previous Viscaria Mine Foreman has been retained.
• Project Geologist Sweden Nigel Baker.
• Project Mining Engineer to be appointed.
• CSA Resources
• Infill and extensional diamond drilling tenders underway.
• Rapallo Mining.
• Swedish environmental consultants retained Hifab.
• MSP Processing.
• Office and warehouse in Kiruna established.

Viscaria Milestones

• Scoping Studies 08
• BFS 09
• Diamond drilling Feb 09
• Assaying and metallurgical testwork to follow
  • Optimise the crushing and grinding circuits to establish –
  • Flotation testwork to establish the optimum grind size and reagent regime to maximise flotation recovery.
• Dewatering and permitting studies underway

Photos

Viscaria Regional Target > 100Mt

• Flown by Redmond Ventures Corp & Billiton Resources
• Targeting IOCG mineral deposits (Roxby Downs)
• Billiton target size +300Mt
• Avalon will target Viscariasized targets from data
• Avalon purchased 600 line kms of data

A Zone NorthTarget- generated by Avalon

110 km 2 tenements with Conductors

Viscaria Properties

VISCARIA STRENGTHS

• High Grade A Zone > 3% Cu
• Large system (4km) + multiple zones (x3)
• Open at depth and along strike
• Existing decline and unmined stopes
• Copper smelters in country- Ronskarr
• Early cash flow and growth opportunities
• Regional producer benefits- area of influence
• Regional exploration targets

Photos

Detailed Airmagnetic TMI Data with Geotem targets

Competent Persons Statement

The information in this report relating to Exploration Results is reviewed by Mr Geoff Hewlett MSc DIC MAIG who is a Member of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists and is the company's Exploration Manager. Mr Hewlett has over 30 years of exploration experience in a variety of mineral deposit styles including uranium, base metals and gold mineralisation and he consents to inclusion of the information in this presentation in the form and context in which it appears. He qualifies as a Competent Person as defined in the 2004 Edition of the "Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves".