The Hawsons Magnetite Project is situated within folded, upper greenschist facies Neoproterozoic rocks of the Adelaide Fold Belt. The Braemar Facies magnetite ironstone is the host stratigraphy and comprises a series of narrow, strike extensive magnetite-bearing siltstones generally with a moderate dip. The airborne magnetic data clearly indicates the magnetite siltstones as a series of parallel, narrow, high amplitude magnetic anomalies. Large areas of the Hawsons prospective stratigraphy are concealed by transported ferricrete and other younger cover. The base of oxidation due to weathering over the prospective horizons is estimated to average 80m in depth.

The Hawsons project comprises a number of prospects including the Core, Fold, T-Limb, South Limb and Wonga deposits. Resource Estimates have been generated for the Core and Fold areas which are contiguous.

The depositional environment for the Braemar Iron Formation is believed to be a subsiding basin, with initial rapid subsidence related to rifting possibly in a graben setting eg the diamictites in the lower part of the sequence. A possible sag phase of cyclical subsidence followed with deposition of finer grained sediments with more consistent, as compared to the diamictite units, bed thicknesses, style and clast composition. The top of the Interbed Unit marks the transition from high to lower energy sediment deposition.

The distribution of disseminated, inclusion-free magnetite in the Braemar Iron Formation at Hawsons is related to the composition and nature of the sedimentary beds. The idioblastic nature of the of the magnetite is believed due to one or more of a range of possible processes including in situ recrystallisation of primary detrital grains, chemical precipitation from seawater, permeation of iron-rich metamorphic fluids associated with regional greenschist metamorphism. Grain size generally ranges from 10microns to 0.2mm but tends to average around the 40micron mark. The sediment composition and grain size appear to provide a control on the mineralisation. There is no evidence for structural control in the form of veins or veinlets coupled with the lack of a strong structural fabric.

In the majority of the Core and Fold deposit the units strike south east and dip between 45 and 65° to the south west. The eastern Fold deposit comprises a relatively tight synclinal fold structure resulting in a 90 o strike rotation.

Mining is to be by conventional open pit methods of drill and blast followed by load and haul then finally In pit crushing and conveying has been adopted as the basis of the PFS, utilising large mining equipment comprising 800t diesel hydraulic shovels and 220t rigid dump trucks.

The mining method utilises truck and shovel for the pre-stripping and the early mine plan, while in pit conveying (IPC) is utilised in year five once meaningful depths have been reached. The plan is to use the conveyor for the vertical lift and the trucks for horizontal movement, maximising the use of comparatively cheap electrical power, reducing truck hours and improving safety. Following a prestrip of ~150mt, the life of mine (LOM) waste:ore ratio is 0.40, dropping to near zero by year 11.

A total of 1406mt of ore and 568mt of waste are mined post pre-stripping. A maximum mining rate of 152mtpa is achieved in year 7.

Overall pit wall slopes ranged from 45º to 55º, depending on wall orientation and lithology.

A minimum mining width of 100m was adopted, with 15m bench heights for optimisiation, design and mine planning.

The proposed metallurgical process is conventional staged impact crushing, followed by coarse rougher magnetic separation, ball milling of the rougher concentrate, cleaner magnetic separation of the ball mill circuit product, elutriation of the cleaner concentrate to produce a high grade magnetite concentrate. The proposed metallurgical process is well tested for this ore and uses established, proven technologies.

All major processing will occur in the magnetite concentrator at the mine site before transporting the concentrate in slurry form to the railhead for de-watering. The process plant consists of the following major elements:

- Primary crushing - Impact crushers.
- Crushed ore stockpiling/reclaiming.
- Secondary crushing – Impact crushers.
- Primary Concentration - Rougher magnetic separators.
- Grinding – Ball mills.
- Cleaner magnetic separators.
- Hydro-separators (Thickener).
-Concentrates transport via slurry pipeline to railhead.
- Concentrates dewatering and handling at the railhead.