Jinka/Mount Riddock Regions Group Report GR078 for exploration licences Harts Range Garnet Project Group Annual report year ending 15 October 2011 EL 25098, EL 24360, EL 24378 and EL 24641 Garnet Project

Abstract

The Spinifex Bore Garnet Project is located approximately 200km northeast of Alice Springs in the Northern Territory. The main objective for Australian Abrasive Minerals Pty Ltd ('AAM') during the reporting period was to continue to work towards achieving a granted Mineral Lease over the identified garnet abrasive resource, with the view to commence mining early in 2012. As AAM sought a partner in the project, it was necessary to conduct extensive and comprehensive reviews of previous work, including geology, mineralogy, metallurgy and water resource. Further, heritage survey, flora and fauna survey and an environmental management plan were commissioned and completed as required in the course of meeting required conditions for the application and granting of a Mineral Lease and as part of the Mine Management Plan. The main focus for this work related to EL 25098 and EL 24360. A bulk sample of material was procured from the deposit for further evaluation both domestically and for overseas interests. A number of other areas within the exploration licenses are considered prospective for additional garnet resources and exploration work to evaluate these areas will be completed to add to the projects resources. Further work during the next reporting year will seek to explore and evaluate the tenements for other mineralisation, given the prospective nature of the area.