Annual report for year ended 5 December 2010 EL 10215 Jervois Project

Abstract

Arafura Resources completed 4,840 metres of RC drilling in 45 holes in the northeast parts of EL 10215 in the first half of 2008. This exploration drilling program was designed to explore the Fe-Ti-V potential of various magnetic targets within the Attutra Metagabbro. Assays of this material were put on-hold in late 2008 and were only re-commissioned in 2010, following an unsuccessful attempt to secure a JV partner in 2009. Assays from the Casper anomaly are reported here. Assay results from the 2008 RC drill program at the Casper anomaly indicate the magnetite-hosted mineralisation averages 0.48% V2O5. DTR studies indicate an average magnetite recovery of 19.1% using the previously recommended grind (close to 100% passing 75 micrometre), and yield an average concentrate grade of 1.69% V2O5 recovering 66% of the contained vanadium. These assay data are broadly similar to the initial results from the 2006 drill program however additional infill drilling and metallurgical testing is recommended to further evaluate the magnetite-hosted vanadium mineralisation within the Attutra Metagabbro.