graphite, page-2

ULEY GRAPHITE PROJECT ­

EBR 100 % DILUTING TO 25 % FREE CARRIED TO PRODUCTION
PORT LINCOLN SOUTH AUSTRALIA

The farminee `Mikkira Graphite P/L' (MG) has paid A$200,000 to EBR to extend its option
on the project a further 18 months to enable MG to continue testing and due diligence. On
exercise of the option MG has the present intention to construct at their sole cost a plant to
achieve `mechanical beneficiation...with an output capacity of approximately 83,000 tonnes
per annum (TPA)... at a carbon content of 60-90 % carbon.'

The previous farminee spent some A $15 million to commission the existing plant at 14,000
TPA at a grade of + 94 % which may be demolished or significantly upsized to achieve MG's
targeted output capacity of 83,000 TPA at 60-90 % carbon.

regards The Tinhopper