MAMBARE SITE VISIT – NOVEMBER 2011Ian Warden – Project Manager

A Joint Venture of

ITINERARY

LOCATIO

NMambare Nickel Laterite Project - Tenement Location Map

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ELA1753ELA1753

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Port of Oro Bay

Port of Oro Bay

HISTO

RIC EXPLORATIO

NMap of historic exploration Summary of nickel / cobalt exploration, Mambare

Key points…

• Massive resource upside – the high grade saprolite half of the deposit was never properly tested

• Anaconda estimated a target resource of 630Mt at 0.8% Ni, just in the limonite – inclusion of the saprolite could double the size and increase the grade

• Potentially one of the worlds largest single nickel laterite deposits

2008 DRILLIN

G RESU

LTS2008 Exploration involved…

• 334 hole program, on a 200 x 400m drill spacing• Ground Penetrating Radar survey of 51 line kilometres• The 2008 program only tested the lower reaches of the

southern slopes below the plateau, and covered only 5% of the total tenement area

• The saprolite layer was not fully tested.• Lack of on-site management due to a management dispute

between key shareholders and lack of density sampling precluded the calculation of a resource following completion of the 2008 campaign

Highlights of 2008

• Best results from CAC-046 in the southeast Ridge, including:16.4m @ 1.8% Ni 0.06% Co, including9.4m @ 2.29% Ni 0.05% Co

• An independent resource potential calculation commissioned by Direct Nickel based on 2008 drilling (non-JORC) estimated a resource potenntial of:

80-120Mt @ 0.8% Ni using a 0.5% Ni cut-off50-70Mt @ 0.9% Ni using a 0.7% Ni cut-off13-19Mt @ 1.2% Ni using a 1.0% Ni cut-off

Target areas identified during 2008 drilling

A WORLD CLASS RESOURCE IN THE MAKING

2011 EXPLORATIO

N PRO

GRAM

The 2011 exploration program involves…

£2m BudgetedMajor focus on Drilling - 220 hole, 3600m drill program, comprising:•Area 1: 40 holes on 200x400m spacing•Area 2: 30 holes on 200 x 400m spacing•Area 3: 90 holes on 100 x 100m spacing•60 additional holes for follow up infill drilling around good high grade holes in Areas 1 and Area 2 to 200x200m spacingsSupported by•Access and Camp establishment•FUGRO aeromagnetic survey analysis and interpretation•Test Pitting•Ground Penetrating Radar Survey – 37 line kilometres•Acquisition of Digital Elevation Model by Satellite Radar

To deliver a resource target of…

Over 30Mt at 1% Ni or greater in Q1 2012, including:•10Mt to Measured or Indicated Resource status in Area 3•20Mt to Indicated or Inferred Resource status in Areas 1 and 2

Area 1Plateau

Area 2North RidgeExtension

Area 3North RidgeInfill Drilling

PROG

RESS & H

IGH

LIGH

TSProgress to date

• Today, more than 1900m has drilled to date across more than 70 holes • Over 50% of budgeted drill metres now completed• Average hole depths have been around 25m, compared to 12m planned based

on previous drilling, as current drilling is fully testing the lower higher grade saprolite layer

• Drilling on target for completion by the end of the year

Highlights

Extremely good grades detected in handheld XRF core testing including•Hole 42 – 5.5m @ 2.5% Ni (wet basis) including 0.35m @ 2.92% Ni, from 19m•Hole 51 – 16.05m @ 1.42% Ni (wet basis) including 0.5m @ 2.28% Ni from 13.35m•Two strong zones of continuous >1% Ni mineralization have been defined running through the center of Areas 2 and 3, and across Area 1•Handheld XRF core testing generally understates grade by around 32% due to the moisture content of the core. Lab results, which will form the basis for upcoming resource statements, are expected to be significantly higher

Drilled >1% Ni>0.8% Ni >2% Ni

• We have only just begun to test the main target (the plateau) this year• Anaconda estimated Mambare held 628Mt at 0.78% Ni using a 0.5% Ni

cut-off, and 198Mt @ 1.01% Ni at a 0.8% cut-off just in the Limonite• This equates to between 2Mt and 4.9Mt of nickel in the ground• Size could double and grade increase significantly - Inclusion of

the saprolite in resource calculations could potentially double the size of the resource and increase the grade significantly as consistent grades over 1% and in many cases grades over 2% have been noted this year in the saprolite

Comparison• The plateau area covers 20km by 6km• The nearby and better known Wowo Gap

project is only 7km by 2km, with a current resource estimate of 198Mt at 0.83% Ni including JORC Indicated Resourceof 39Mt @ 1% and Inferred 50Mt @ 1.01% Ni

MASSIVE RESO

URCE U

PSIDE

How big could Mambare really be?

2011 Drilling

WELL LO

CATED – EXCELLEN

T LO

GISTICS

Major Access Advantages over other PNG laterites

• Access by sealed and graveled road from the project site, to the deep-water port of Oro Bay, via the provincial capital, Popondetta.

• Oro Bay, is a a government-operated port capable to berthing vessels up to Handymax size (45,000dwt). The port is currently underutilized and space exists for further port expansion.

• 80km of the 120km Oro Highway is sealed. The remaining 40km will be sealed in 2012-13

• Hurricane Guba severely damaged bridges throughout Oro Province in 2007. Tendering for bridge reconstruction along the Oro Highwayis currently underway, with work commencing in 2012

• Right on our doorstep: Kododa boasts an Australian funded hospital and commercial airport

Oro Bay – A deep-water port & potential process plant site

Sealed / graveled roads directly from site to Oro Bay port

Oro Bay – An excellent option for future processing plant

Graveled Road – soon to be sealed

Sealed Road

ACCESS TO CHEAP, GREEN ENERGY

ACCESS TO CH

EAP GREEN

ENERG

Y

What is Geothermal Energy

• A green energy source derived from heat stored in the ground• A potential source of cheap energy for the Mambare Project• It also has the potential to provide power to greater Oro Province

and to reduce the district’s dependence on imported fossil fuels.• An established energy source increasingly used for power

generation in the Philippines, Iceland, California and elsewhere. • Within PNG, geothermal energy is currently used for power

production at the Lihir Gold Mine in nearby New Ireland Province.

Major Advantages – Cheap, Green Energy

• The Mambare JV identified significant potential for geothermal energy 45km east of the Mambare project area, close to the deep-water port of Oro Bay

• Two Exploration Licence Applications (ELA’s) have been filed over the volcanic centres of Mt. Lamington/Hydrographers Ranges (ELA1952), and Mt. Trafalgar (ELA1953).

• Geothermal heat could provide cheap, renewable energy for process heat and electrical energy for use in any future mine and DNi Process plant serving the Mambare Project, with significant operating cost advantages

GEO

THERM

AL TENEM

ENTS

Geothermal Temenent – Cheap Green Energy, close to Mambare, close to the Port

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Port of Oro Bay

Port of Oro BayMambareMambare

x Mt Lamington

x Hydrographers Ranges

x Mt. Trafalgarx Mangalase Vent Field

THE DNi PROCESS - GAME CHANGING TECHNOLOGY

THE CH

ALLENG

E FOR W

ORLD

NICKEL

SUPPLY 73% of world nickel reserves are contained in laterites

But laterites produce only 44% of global nickel production

Nickel sulphide discoveries are declining

Traditional laterite processes have not been the solution

Global nickel demand is outstripping supply

The stage is set for a revolution in nickel…

THE D

IRECT NICKEL PRO

CESSPotential to transform an industry

• One flow sheet for the entire laterite ore profile, both limonite and saprolite

• Atmospheric pressure, tank leach, 304 stainless construction• Recovers 90-95% of nickel in 1 to 4 hours residence time• Much lower technical intensity than HPAL

and smelting • Recycles reagent (+95%), environmentally friendly tailings and low

emissions • Fully scalable and profitable from 5,000tpa nickel size (under $200m)• Produces Ni/Co Mixed Hydroxide Product (MHP - 40% nickel)• Potential saleable by-products MgO, Fe2O3, Al2O3

Industry Changing Capital and Operating Costs

Treatment of the full laterite profile

Direct N

ickel ProcessD

irect Nickel Process

Capex: •Competing laterite technologies produce nickel at a cost of US$25 to over US$35 per pound of annual capacity.•The DNi Process produces nickel at US$12.50 per pound of annual capacityOpex:•Existing laterite processes produce nickel at a cost of around US$5-8 per pound•DNi opex is around US$1.83 per pound of nickel, before cobalt credits

All DNi costs independently produced by Aker Solutions (now Jacobs Engineering)Note comparisons show DNi Process to MHP paying at ~75% of LME

A REVOLU

TION

ARY COM

BINATIO

N

THANK YOU