PROJECTS

NARRABURRA RARE EARTHS & RARE METALS PROJECT

EL 5629 and 5985 TEMORA NSW

Licence Granted: EL 5629 1 October 1999 : EL 5985 3 September 2002

Location: 12 kilometres northeast of Temora
Area: EL 5629 11 km2; EL 5985 84 km2

Target: Porphyry or bulk disseminated style rare metals, heavy rare earth elements (REE) and intrusive related gold-REE deposits in fractionated, peralkaline granite complex.

Commodities Sought: Zirconium, yttrium, niobium, REE, thorium, rubidium, gallium, lithium, tantalum ... for high-tech industrial market.

Exploration Philosophy:
Capital is searching for residual (i.e. soft, readily mined) and primary (hard rock) deposits of rare metals invariably weathered to fresh specialised granitic host rocks.

Project Status - July 2007:
EL 5629 - Data assessment completed; airborne geophysics data assessed; photogeological study, geological mapping & rock chip sampling completed; ground radiometric anomaly outlined; petrological, mineralogical & preliminary metallurgical studies completed; 300 m RC drilling in 8 holes completed March 2006; inferred resource outlined; petrological and mineralogical studies in progress.

EL 5985 - Literature research completed; regional geophysics data assessed; reconnaissance mapping completed; rock chip geochemical data acquired & assessed; ground radiometric survey undertaken; drill targets outlined; exploration continuing.

Achievements to Date:
Encouraging results have been received from drill testing of deeply weathered granitic intrusive with relatively high Zr, Hf, Nb, Th and REE in a 1,500 m by 500-800 m mineralised zone of interest. An estimated inferred oxide resource to 40 metres based on RC drilling of 55 million tonnes at 1000 g/t ZrO2, 60 g/t Y2O3, 300 g/t REO, 40 g/t HfO2, 80g/t NbO2, 50 g/t ThO2 (at 30th June 2006), has been outlined.

Objectives of Proposed Exploration Programme:
Capital is aiming to establish the limits and grade of the resource at the Narraburra prospect; evaluate methods to produce a concentrate from oxide and primary mineralisation types and to test geophysical and conceptual targets under shallow cover in EL 5985.