Warrego reporting group MLCs 22, 39-41, 71-76, 83-84, 102, 107-108, 682 and 692 Warrego Leases and MLCs 158-165 Warrgeo Gravel Leases and MLCs 81-82, 103-106 and 682 Annual report 26 March 2004 to 25 March 2005

Abstract

The Warrego group of leases were acquired by Giants Reef Exploration Pty Ltd (Giants Reef) to search for Tennant Creek style iron oxide copper-gold deposits. The Warrego leases contain the Warrego deposit and the Warrego ore treatment plant infrastructure. The Warrego ore processing facility was recommissioned by Giants Reef in 2003 and processing commenced on 17 October 2003. This Group Report records exploration work done on MLCs 22, 39-41, 71-76, 81-84, 98-108, 682 and 692 (Warrego Leases) and MLCs 158-165 (Warrego Gravel Leases) between 26 March 2004 and 25 March 2005. Although MLCs 81, 82, 103, 104, 105. 106 and 682 were transferred to Territory Iron Pty Ltd in 2003, Giants Reef was appointed as the Operator of these leases until 30 June 2005. Giants Reef requested this arrangement in order to utilise dams (Dams 2 and 3) located in these, for future tailings storage from it's Warrego Ore Treatment Plant if required. To date Giants Reef have not utilised these dams and do not anticipate any requirement to do so in the future. Consequently Giants Reef will advise Territory Iron Pty Ltd that we wish to terminate our appointment as operator for these leases. The Warrego deposit was included in a Gold-Copper Expansion Study undertaken during the year. Two phases of RC drilling for a total of 1,046 metres was undertaken to test the Warrego Hanging Wall lens. A sectional resource estimated indicated that the Warrego Hanging Wall Lens contained approximately 35,000 t at 11.8g/t Au and 1.3% Cu. An economic evaluation of the open pit mining potential was completed with negative results. The discovery of the haematite-magnetite Chariot deposit in 1998 has shown the potential for variations on the classic magnetite ironstone hosted gold +/- copper deposits, where lower order magnetic anomalies, plus gravity methods can define new targets. Discoveries by Giants Reef of mineralisation such as at Malbec West, Marathon and Billy Boy further support this. Giants Reef considers the potential for the discovery of mineralisation in hematite dominant ironstones in this group of tenements is good.