SEL 26397, EL 23117, EL 23118, EL 23513, EL 23514, EL 24285, EL 24286, EL 23993, EL 26404, EL 22307, EL 23931 Abner Project Combined annual report for the period 3 August 2009 to 2 August 2010

Abstract

The Abner Group is a high priority region in Legend International Holdings' ('Legend') diamond exploration endeavours. Significant exploration activities conducted on the Abner Group tenements have identified several targets and been explored simultaneously. In early 2009, Gravity Diamonds signed a sales contract with Legend International Holdings Inc for the sale of all of its Australian based properties and rights to tenements held by third parties such as SEL 26397 and EL 22307. Although the contract was binding, its completion was subject to a particular condition precedent involving the owners of the tenement (Rio Tinto Pty Ltd.) that unexpectedly held up its completion and therefore limiting planning for the field season. Open file reviews and target generation processes were completed throughout 2009. The acquisition of Gravity Capital Limited ('Gravity Diamonds') tenements in 2009 instigated a comprehensive data compilation exercise to incorporate the data received and aimed at prioritizing existing and generating new exploration targets for the field season. Field-based exploration activities included ground or helicopter reconnaissance over all acquired tenements, Heavy Mineral Analysis ('HMA') Sampling, MMI sampling, Ground geophysics including EM Surveys, and gravity surveys over target regions. Prioritization was on producing a sound geological platform from which to improve target selection. For this detailed geophysical analysis and compilations were instigated as well as geological interpretations over the project area. Detailed geochemical analysis of existing indicator minerals was initiated. In the Abner Group, the more advanced project areas are SEL 26397, EL 22307 and EL 23514. Work programs on these tenements focused on the diamond prospectivity of the area and have numerous targets. A prolonged wet season in 2009-2010 deferred exploration activities, not allowing ground access to some areas until July.