March Quarter 2012 Activities Report

Higher Grade Mineral Resources identified at

Hodgson Downs and Sherwin Creek.

Infill Drilling to improve definition and assess DSO.

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Reinterpretation of the iron mineralisation at Hodgson Downs and Sherwin Creek has allowed modeling and estimation of continuous zones of higher grade iron Mineral Resources with good potential to support a Stage 1 project for DSO operations. Some 33.8Mt of Inferred higher grade Mineral Resources have been identified within the much larger, lower grade deposits.

Modeling of the higher grade, DSO component zones has enabled conceptual pit shells and drilling design for an infill RC drilling program at Hodgson Downs (EL24102) and Sherwin Creek (EL24101). This program intends to improve resource confidence and advance DSO project study.

Reconnaissance and sampling over EL26412 and EL28497 indicate additional iron oxide potential outside the Sherwin Formation, not previously considered prospective for iron mineralisation.

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1 Higher Grade Mineralisation Review and New Higher Grade Resource Estimates

The iron mineralisation constituting the previously reported lower grade Mineral Resources at Hodgson Downs (Deposits X and W) and Sherwin Creek (Deposit C) has been reinterpreted. The purpose of reinterpretation has been to identify continuous zones of higher grade mineralisation suitable for a Direct Shipping Ore product to support the first of two stages of a project development strategy announced 3 April 2012.

The reinterpretation, using a guiding >55% Fe grade, succeeded in identifying continuous higher grade portions of mineralisation allowing the in-house modeling and estimation of Inferred Mineral Resources aggregating 33.8Mt across the three deposits. These higher grade zones are contained within the much larger, lower grade Mineral Resources previously estimated (Table 1a). New, higher grade Mineral Resources were reported for Hodgson Downs Deposits X and W on 3 April 2012. Higher grade Mineral Resources from Sherwin Creek Deposit C are listed below for the first time (Table 1b).

27 April 2012

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Table 1a. Roper River Iron Ore Project – Total Lower Grade Resources*

Deposit / Category Cut-off

(Fe %)

Bulk

Density

Tonnes

(Mt)

Fe

(%)

Al2O3

(%)

SiO2

(%)

P

(%)

LOI

(%)

Hodgson Downs

Deposit X Inferred 40 2.71 23 49.3 2.3 17.20 0.088 6.28

Hodgson Downs

Deposit W Indicated +

Inferred

40 2.71 84 46.1 2.5 19.96 0.073 7.57

Hodgson Downs

Deposits T, U, Y

Inferred

35 2.84 46 39.9 2.8 19.00 0.070 15.00

Sherwin Creek

Deposits (A), B, C

Inferred

35 2.51 320 40.1 1.8 34.40 0.006 4.26

Mount Fisher

Deposit M

Inferred

35 2.54 15.6 44.0 4.4 26.90 0.130 3.50

Project Total#

- - 488 41.7 2.1 29.4 0.03 5.9

# Some rounding for totals.

* The Lower Grade Mineral Resource estimates are reported in accordance with the guidelines of

the JORC Code (2004) by SRK as at December 2010 for Hodgson Downs Deposits X and W and as at January 2012 for

Hodgson Downs Deposits T, U, Y; Mount Fisher Deposit M; Sherwin Creek Deposits A, B, C.

Table 1b. Roper River Iron Ore Project – Higher Grade Resources**

Deposit / Category Cut-off

(Fe %)

Bulk

Density

Tonnes

(Mt)

Fe

(%)

Al2O3

(%)

SiO2

(%)

P

(%)

LOI

(%)

Hodgson Downs

Deposit X Inferred 55 2.7 8.1 57.5 2.0 12.64 0.10 2.33

Hodgson Downs

Deposit W (North and

South) Inferred

55 2.7 7.4 56.7 2.4 12.55 0.09 2.69

Sherwin Creek

Deposit C Inferred 55 2.7 18.3 57.6 1.1 13.01 0.01 2.59

Higher Grade Total##

- - 33.8 57.4 1.6 12.8 0.05 2.6

## Some rounding for totals.

** These Higher Grade Mineral Resource estimates represent a portion within the lower grade

estimates in Table 1a. The estimates are reported in accordance with the guidelines of the JORC Code (2004) by Sherwin Iron

and audited by Coffey Mining as at March 2012.

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2 Planned Infill Drilling

During the March Quarter conceptual mining pit shells were designed around the new, higher grade resource

models, supporting the planning of infill drilling of both Sherwin Creek (C) and Hodgson Downs (W and X)

Resources as described in the previous section. A total of over 5000m drilling is planned from over 200 RC drill

holes in the three areas of C, W and X (Figures 1, 2 and 3). As at end of March approximately 100 drill pads had

been prepared. This will nominally close drill spacing to 200m x 100m. In addition an area of close spaced panel

drilling is planned at Sherwin Creek to test the iron oxide continuity and assess variability at 50x25m spacing.

Coffey Mining has been engaged to oversee technical aspects of the project advancement to pre- feasibility

stage. This includes providing technical advice to Sherwin on QA/QC procedures for the upcoming drilling

program and follow up auditing of resource modeling and estimation.

Drilling is planned to commence and be completed within the June Quarter. Following return of assay results

and subsequent geological interpretation resource modeling will be conducted. This overall program is expected

to support a resource confidence upgrade from Inferred to Indicated Mineral Resources at each of Sherwin Creek

and Hodgson Downs providing better definition of a high grade DSO resource component in each case.

FIGURE 1 Proposed Infill and Panel Drilling at W Deposit

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FIGURE 2: Proposed Infill and Panel Drilling at X Deposit

FIGURE 3: Proposed Infill and Panel Drilling at C Deposit

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3 Reconnaissance and Rock Chip Sampling EL26412 and EL28497

An area of prospective iron oxide in the northern part of EL26412 was field checked using helicopter based rock

chip sampling. The area is mapped and described by previous workers and in Northern Territory Geological

survey Reports as containing Munyi Member Sandstone, which is a separate stratigraphic unit outside the

Sherwin Formation.

A total of 16 rock chip samples were collected by John Fabray and Associates from within Munyi Member

outcrop(Figures 4, 5 and 6) and five of these samples returned laboratory assay results greater than 40% Fe, with

a best result of 48% Fe (Table 2). This is significant as all iron oxide discoveries in the area to date have been

restricted to the Sherwin Formation These results will need further assessment and follow up as they

demonstrate potential for iron oxide exploration targets away from Sherwin Formation stratigraphy.

Samples were collected over a distance of 25km strike within EL26412, as shown below (Figure 4). Results in

excess of 40% Fe were obtained in MM001,3,4, 8 and 14 ie intermittently over almost 20km strike.

Reconnaissance at EL28497 did not include any samples being collected for assay.

FIGURE 4: Rock Chip Sample Locations EL26412

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Figure 5: MM008 Sample Site Figure 6: MM003 sample Site

Table 2. EL26412 Rock Chip Sample Locations – Descriptions - Results

Sample ID GDA_E GDA_N Field Notes Lab Fe%

MM001 441413 8359351 Poor rubbly outcrop of oolitic sandstone on dip slope of Hodgson Sandstone

42.2

MM002 441805 8357210 as above - very poor outcrop, lateritic in part 34.1

MM003 445881 8349485 as above - possibly secondary enrichment and laterised. 48.7

MM004 447047 8347845 Poor outcrop of oolite and and oolitic sandstone. Secondary hematite?

44.5

MM005 449479 8314787 Poor rubbly outcrop of ferruginous sandstone with minor oolite

26.9

MM006 466058 8338279 Poor rubbly outcrop of oolite, oolitic sandstone and ferruginous sandstone

32.4

MM007 460288 8341218 Good outcrop of ferruginous ?pisolitic sandstone on ridge crest

37.9

MM008 459035 8342467 as above - possibly 0.5 to 1.0m thick? 44.6

MM009 457399 8343936 Poor outcrop mostly secondary hematite at base of Munyi Member

39.1

MM010 456090 8345156 Good outcrop of mostly ferruginous sandstone 30.9

MM011 451665 8342591 Good outcrop of ?pisolitic ferruginous sandstone which dips south

32.4

MM012 452258 8344862 as above - flat lying 18.8

MM013 450624 8345216 Laterised ferruginous sandstone - possibly not Munyi Member 6.3

MM014 449137 8346321 Outcrop of ferruginous sandstone with some minor oolite 40.5

MM015 446165 8346487 Outcrop of laterised ferruginous sandstone ?Munyi Member 25.2

MM016 444499 8347006 Outcrop of ferruginous sandstone with minor oolite 33.1

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Competent Persons Statements

The information in this report that relates to the lower grade mineral resource estimation summarised in Table 1a is based on work completed by Mr Peter Gleeson who is a member of the Australian Institute of Geoscientists and Mr Roger Pooley who is a member of the Australasian Institute of Mining and Metallurgy. Both Mr Gleeson and Mr Pooley are full time employees of SRK Consulting (Australasia) Pty Ltd. Mr Gleeson has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Pooley has over twenty years relevant experience in iron ore and other bulk commodities and is a competent person with regard to evaluating iron ore projects. Both Mr Gleeson and Mr Pooley consent to the inclusion in the report of the matters based on this information in the form and context in which it appears. The information in the report that relates to the higher grade DSO mineral resource estimation summarised in Table 1b is based on work completed by Sherwin Iron, and assessed and compiled by Mr David MacDonald who is a member of the Australian Institute of Geoscientists. Mr MacDonald is a full time employee of Coffey Mining Pty Ltd and has sufficient experience relevant to the style of iron mineralisation and type of deposits under consideration to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (The ‘JORC Code’). Mr MacDonald consents to the inclusion in the report of the of the matters based on his information in the form and context in which it appears. The exploration results tabulated in Table 2 and the data and geological interpretations on which the Mineral Resource estimates are based have been compiled by Mr Tony Ryall who is a member of the Australasian Institute of Mining and Metallurgy. Mr Ryall is a full time employee of the Company and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.’ Mr Ryall consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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