EL 24549 Annual Report for Cleo's Uranium Project period ending 22 September 2007

Abstract

The Cleo's Uranium Project comprises one granted Exploration Licence (EL 24549) located 175 kilometres by road, southeast of Darwin and covers an area of 435km2 within the Pine Creek Geosyncline. This project is 100% owned by Atom Energy Ltd. Uranium mineralisation was discovered at the Cleo's Project in the Twin and Dam deposits in the mid 1980's by Total Mining Australia Pty Ltd (Total Mining). From 1984 to 1988 Total Mining carried out an extensive exploration program which included geological mapping, ground radiometric surveys, soil radon (Alphacard) determinations, ground magnetic surveys, EM conductivity surveys, a stream sediment orientation survey, trenching and drilling. A total of 15,369 metres of drilling was completed in 367 holes and included 682 metres of auger drilling, 13,569 metres of percussion drilling and 1,118 metres of diamond drilling. Based on this drilling, Total Mining estimated the two deposits contained a combined inferred resource of 621 tonnes of U3O8. Exploration activity was suspended when Total Mining's French parent company withdrew from exploration in Australia and no uranium exploration has been carried out on the project since the late 1980's. In April 2007 Atom Energy acquired the tenements from Imperial Granite and Minerals Pty Ltd and Robert Bruce Cleaver. Atom raised $10 million dollars and listed on the ASX on 26 June 2007 with the aim of continuing exploration and development of a uranium resource at the Cleo's Project. Activities completed by Atom up to 23 September 2007 include: - Compilation of historical data into database - Validation of historical assays and logs - Digitising and translation of historical downhole gamma logs into digital format for use in resource estimation. - Surveying of existing historical drillholes for inclusion in database - Generation of targets for RC drilling program comprising some estimated 90 holes to be targeted in the Twin and Dam areas. Atom expenditure on exploration between the purchase date and the end of the reporting period (22 September 2007) was $104,000. Expenditure in this reporting period was limited as no significant exploration activates could be undertaken while sale of the tenement was being finalised. Transfer of the tenement to Atom was complete on 14 September 2007, eight days prior to the end of the reporting period. Atom's exploration activities during the reporting period were limited to evaluation of historic drilling data and resource modeling and expenditure was less than the expected annual expenditure commitment of $390,000. Field operations commenced immediately post the anniversary and some preliminary details of this drilling program have been included in this report. Expenditure post the report anniversary to the end of November 2007 totals in excess of $199,210. A drill program (RC) designed to confirm earlier drilling data and increase the resource at Cleo's commenced 20 October 2007 and continued until 26 November 2007. Initial results from this drilling program have been included in this report, however at the time of reporting majority of the results were not yet available and will be reported in the next Annual report.