Third Annual Technical Report GR274 incorporating EL 26524, EL 28342, EL 28343, EL 28870, EL 28892, EL 29040, EL 29041, EL 29631, EL 29632, EL 29633, EL 29634, EL 29635, EL 29659 9 February 2014 to 8 February 2015

Abstract

The Roper Heavy Minerals Project (RHMP), owned 100% by Australian Ilmenite Resources Pty Ltd (AIR), lies 550kms SE of Darwin and is accessed via Stuart Highway and then Roper Highway for 120kms east of Mataranka towards Roper Bar. Both the Roper Highway and Roper River transect the project area and provide fundamental infrastructure necessary for any future mining operation. Three reporting groups cover AIR's exploration tenements portfolio (GR274, 275 and 276). In addition there are two MLs that have been reported separately. This report covers activities on AIR's GR 274 tenements (ELs 26524, 28342, 28343, 28870, 28892, 29040, 29041, 29631, 29632, 29633, 29634, 29635 and 29659). The reporting period for this title group is 09/02/14 to 08/02/15 and this is the Third Annual Group Technical Report. GR274 is located in the central and northern portion of AIR's land holdings centred approximately 120kms east northeast of Mataranka in the Roper River region of the Northern Territory. At a meeting with NT DME in May of 2014, AIR reaffirmed its intention to complete EL assessments to either advance exploration on particular tenements or surrender them in part or in whole. A desktop analysis was commenced and exploration field checks were being planned to complete this review for all ELs within GR 274. As part of this review process EL 26524 was subjected to a 52% reduction in area based on a desktop and on-ground assessment considering both the resource potential and infrastructure proximity. A total of 11 samples were collected and results supported the partial relinquishment decision. This programme is described within the report. On 28 July 2014 KordaMentha were appointed as Receivers and Managers of AIR ('the Receivers'). Since appointment of the Receivers the process of tenement assessment to rationalise the project holding has been reaffirmed, with support from AIR personnel, external consultants and TZMI. The Receivers are aware of the potential value of this project and a preliminary desktop analysis has been completed to assist in rationalising the holding within GR 274. TZMI of Perth, Western Australia has accepted a brief to provide advice and oversee assessment of the exploration licences.