Annual report for EL 22269, year ended 23rd February 2003

Abstract

On behalf of our client, Arafura Resources KL, the current holder On behalf of our client, Arafura Resources NL, the current holder of this licence, weadvise that no on-ground exploration was conducted on the licence area during the past year.This is a result of delays in Arafura's attempt to finalise an IPO to raise exploration funds. We can report that near the end of 2002 the\Company successfully raised additional working capital to meet the administrative costs of the IPO. This is now planned for completion toward the end of April, 2003, subject of course to a favourable investment climate at that time. As part of the IPO process the Company has had an Independent Consulting Geologist Report completed for all of its projects including this title. This process included a visit to the Frances Creek area, including Mt Sanders, by the Independent Geologist accompanied by a Director of the Company. We estimate that some $10,000 of the costs involved in preparing the ICGR and of the administrative costs of Arafura over the past year, can be allocated to EL 22269. The total of $10,000 satisfies the Expenditure Covenant for Year 1 of the title which was at $9,000. We propose that the same exploration program and expenditure covenant as was deta: the application for the title now applies for the second year.