Exploration

Exploration Objective
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The exploration program will define sufficient bauxite mineralisation to support the Company's business objectives. This currently is aimed at defining a broad scale (Inferred) resource sufficient to commence a feasibility study for an alumina refinery. Included in the exploration strategy is establishing resources which may be amenable for direct shipment of ore (DSO) material. This requires a higher quality of bauxite than for a local refinery.

The areas targeted by the Company result from a review of historical data, including drilling by previous companies, and internal parameters which are used to define the bauxite potential of various landforms and areas.

The area held under tenement and following Exploration Licences includes areas of farmland and forest areas that are zoned for logging for timber. Tenements are granted in graticular blocks that are defined by lines of latitude and longitude. The graticular blocks may well include areas with roads, towns or restricted/protected forest areas where BAJV will not explore/mine. BAJV will exclude all exploration/mining in areas such as conservation reserves, Karri forests and informal reserves listed under Appendix 3 of the Forest Management Plan 2004 - 2013, including:

• Old-growth forest;
• Areas previously classified as old-growth forest;
• River and stream zones;
• Travel route zones;
• Diverse ecotype complexes;
• Poorly reserved forest ecosystems; and
• Regional Forest Agreement accredited linkage zones.

Historical Data Review

The Company obtained and reviewed historical data relating to exploration and drilling conducted by companies exploring for bauxite in the Darling Range including: CSR/Pacminex, Yam Ltd, Project Mining Corporation, Hancock and Wright, Bridge Oil Ltd, Alcoa and BHP.

This historical data goes back some 40 years, as a result of concerted bauxite exploration campaigns involving all of these companies.

The team has electronically captured this data and digitally overlayed it onto BAJV's tenements identifying numerous drill targets for both refinery feed and DSO.

Darling Range Tenements

BAJV has a tenement holding of around 24,000km² in the Darling Range region. The tenements are close to existing infrastructure and include areas of similar land category to current bauxite mining operations. These Companies have established award-winning environmental rehabilitation operations that are well established and can be similarly implemented. These areas allow the company a variety of choices as to selecting suitable mine sites with supporting infrastructure.

Target Generation

The target generation is based on a combination of landform, elevation, laterite occurrence, vegetation and other factors. This is combined with any other available data such as rock chip assays and DMP open file reports to derive a schedule of land access and drilling. This is further directed by the order of granting of tenements which must undergo the full Mines Act regulatory process prior to grant.

Heritage surveys with indigenous landowners, flora and fauna surveys, conservation management plans, land access agreements and any other required investigations form part of the program of works to tenement areas for exploration.

Due to logistical and land access considerations, exploration activities have been broadly split into three project regions, as detailed below:


North Darling Range The North Darling Range project encompasses the tenement areas that lie north-east of Perth and are predominately private property. Due to the initial grant of tenements in this area most of the exploration to date has occurred within this project area and has relatively simple access to Kwinana Port.

The objective to the end of 2011 is to cover the prospective areas with a first pass, broad scale drilling at a 80mx80m or wider drill pattern. This drilling is ongoing and several tenements are still to proceed to grant, but resources defined to 30/6/2011 were announced as follows:

Increased global bauxite resource to 24.8Mt in North Darling Range:

• Global Resource increased to 24.8Mt @ 30.6% Available Alumina and 3.9% Reactive Silica.
• Maiden Inferred Resource at Juturna of 8.2Mt @ 29.9% Available Alumina and 3.9% Reactive Silica.
• Updated Inferred Resource at Vallonia of 105Mt @ 28.0% Available Alumina and 3.9% Reactive Silica.
• Further Maiden Resources (Stage 1 Cardea & Minerva) currently being modelled with stage two drilling underway.
• Additional new prospects (Pomona and Concordia) identified, with first pass drilling complete.
• Current resources to be reassessed for amenability to high temperature refining aimed at increasing the Available Alumina and improving Available Alumina to Reactive Silica ratios.

South Darling Range The South Darling Range covers large areas of ground extending to south of Manjimup. This region has a relatively even mix of Crown land and private property and as such consultation with Government departments and additional protocols are undertaken.

Although many prospective lateritic areas exist in the region, as defined by the Geological Survey of WA, previous exploration is limited. As with the north, target areas have been identified and the BAJV is working closely with DMP to try and grant more prospective tenements first. The land access strategy will target these areas as soon as a tenement grant is imminent. Reconnaissance field trips are a regular occurrence to evaluate the private property areas and assess the optimum process of evaluating Crown land.

East Darling Range The East Darling Range encompasses areas that lie to the east of the Alcoa and BHP Alumina State Agreement mineral leases. This project covers large areas of broad-acre, privately owned farmland in the vicinity of south Northam through to Albany and the connecting railway line which has access to Albany Port.

The project area contains bauxite mineralisation identified by BHP in the 1960s and 1970s. Reconnaissance mapping conducted by BAJV confirms that remnant laterite occurs over much of the project area where historic drilling intersected bauxitic laterite. Drilling has commenced on a limited number of granted tenements in this region.