Mount Peake Project First Group Annual Report EL 23074 22 July 2011 to 17 February 2012, EL 23271 22 October 2010 to 17 February 2012, EL 27069 13 August 2011 to 17 February 2012, EL 27070 13 August 2011 to 17 February 2012, EL 27706 18 May 2011 to 17 February 2012, EL 27787 09 August 2011 to 17 February 2012, EL 27941 20 October 2010 to 17 February 2012, EL 28491 21 July 2011 to 17 February 2012

Abstract

The Mount Peake Project is operated by Enigma Mining Ltd, a wholly owned subsidiary of TNG Ltd. The project comprises eight exploration licences (EL 23074, EL 23271, EL 27069, EL 27070, EL 27706, EL 27787, EL 27941 and EL 28491), covering an area of approximately 2034 km2 in the north-central portion of the Paleoproterozoic Arunta Province. The project area is located approximately 220km NNW of Alice Springs in the Northern Territory and covers portions of the Mount Peake (SF53-05) 1:250,000 map sheet. It lies within the Stirling and Anningie Pastoral Leases and is subject to Native Title. The main focus of the Mount Peake project is a world class Fe-V-Ti deposit which lies within EL 23074. The project has reached pre-feasibility stage with a report due to be delivered shortly. Diamond drilling at the Fe-V-Ti deposit at the end of the last reporting period was aimed at providing representative samples for metallurgical and pilot plant testwork. The results have confirmed the presence of continuous and reasonably homogeneous mineralisation hosted within the magnetite zone, and include the highest vanadium and iron grades intersected to date in un-beneficiated material of up to 0.6% V205 and 36% Fe. RC drilling was undertaken to infill and upgrade the existing JORC resource. The grades and widths of intersection encountered in this drilling have contributed to an over increase in both tonnes and grade of an updated JORC resource at Mount Peake. This updated resource estimate of 160Mt grading 0.27% V2O5, 5% TiO2, 22% Fe represents a significant increase from the previous Inferred Resource estimate of 139Mt grading 0.29% V2O5, 5.3% TiO2, 23.6% Fe. Significantly, approximately 70% of the resource, or 112 million tonnes, is now confirmed in the Indicated category, and available for conversion to Ore Reserves. The Interim PFS results have been independently prepared by METS (process and infrastructure design and related capital and operating costs), Snowden (mine design, mining costs and financial analysis) and SKM (transport costs) to an accuracy level of 25 per cent, which is typical for a PFS and provides a strong platform to progress to a Definitive Feasibility Study ('DFS') decision. The study is based on the updated JORC Indicated and Inferred resource referred to above. The metallurgical testwork programme for all phases of the TIVAN? metallurgical process is progressing steadily. Operation and testing of the pilot plant commenced in mid-March, providing a definitive test of the commercial potential of the TIVAN? process to produce a high purity aqueous vanadium solution leading to a vanadium pentoxide product of commercial grade. Additional work on the Mount Peake project area involved the completion of a Geological Review which concludes that the geophysical data and drilling results from Mount Peake show the Murray Creek Ti-V magnetite body is part of a larger sill with other shallow targets. Other sills with Ti-V mineralisation potential are present within TNG's tenements. Additional drill targets on EL's 23074, 23271, 27070, 27069 and 27941 have been identified as a result of a geophysical review of the regional magnetic data available over the Mount Peake area. Many of these will be drilled during April 2012, and results of these programmes will determine the path of exploration on these tenements. A review of historical exploration was carried out on EL's 27941 and 28491 and once reviewed on ground reconnaissance work will be planned.