GSC Annual Report 2008 - ioneer.com · REVIEW OF OPERATIONS 6 In Peru, Global holds 100% interest...

Global Geoscience Limited Annual Report

2008

Corporate Directory Directors

Robert Reynolds Chairman

Bernard Rowe Managing Director

Pat Elliott Non-executive Director

Peter Nicholson Technical Director

Company Secretary

Joanna Morbey Registered and Principal Office

Suite 203, 161 Walker Street

NORTH SYDNEY NSW 2060

Telephone: +61 (2) 9922-5800

Facsimile: +61 (2) 9922-4004

Website: www.globalgeo.com.au

e-mail: [email protected]

Share Registrar

Registries Limited

Level 2, 28 Margaret Street

SYDNEY NSW 2000

Telephone: +61 (2) 9290 9600

Auditors

Barnes Dowell James

Level 13, 122 Arthur Street

NORTH SYDNEY NSW 2060

Listed on the Australian Stock Exchange Limited

19th December 2007

ASX Code: GSC

ABN: 76 098 564 606

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TABLE OF CONTENTS

Chairman’s Report 4Review of Operations 5Schedule of Tenements 16Directors’ Report 18Income Statement 26Balance Sheet 27Statement of Cash Flows 28Statement of Changes in Equity 29Notes to the Accounts 30Directors’ Declaration 51Auditor’s Independence Declaration 52Independent Auditors Report 53Corporate Governance Statement 56Shareholder Information 59

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22nd September 2008

Chairman’s Letter The nine months since the Company successfully completed its IPO have been a very busy and productive time. Global commenced trading on the ASX on the 19th of December 2007 after raising A$3.3 million through the issue of 16.5 million shares at 20 cents. Since then Global has set about pursuing the exploration strategy outlined in Company’s prospectus. Much has been achieved in a very short space of time:

• Substantial exploration programs undertaken on three of its original projects in Peru & USA. • Major targeting study completed over Arizona-Mexico porphyry province with two new projects

acquired. • Exploration programs undertaken on two new Arizona projects. • In all, three projects advanced to the drill-ready stage (Mancha Pampa, New Morenci and Tokop). • Exploration agreement completed with international mining company Inmet Mining Corporation

on the Los Graceros porphyry project in Mexico. • Initial drilling program completed at Brown Mt, NSW.

At Mancha Pampa the Company has made what it considers to be a new discovery of porphyry-style copper-gold-silver mineralisation at the Quillcata prospect. There is no evidence of any previous exploration at the prospect and so the Company believes the 600m by 450m copper anomaly is untested. Work is well underway to obtain the necessary environmental and regulatory approvals for drill testing Quillcata and a work agreement has been signed with the local community. Global has identified and acquired tenure over a possible extension to the mineralised system that hosts the giant Morenci porphyry copper mine in Arizona. The Company has identified a number of indicators that suggest the New Morenci project, located just 5km north of the Morenci mine, has the potential to host porphyry copper mineralisation. International mining company, Inmet Mining Corporation, has entered into an exploration agreement with Global whereby Inmet may earn a 51% interest in Global’s Los Graceros porphyry project in northern Mexico by spending US$2 million on exploration over the next three years. The Company is delighted to have attracted the attention of a company like Inmet and believes it is testimony to the quality of the porphyry copper projects the Company has been able to identify and acquire. Inmet’s involvement will see an acceleration of exploration activity at Los Graceros. Global has and will continue to maintain a focus on identifying, acquiring and advancing early-stage mineral exploration opportunities that show potential to host large, high-value deposits. In line with this strategy, the Company will continue to focus most of its efforts within major porphyry copper provinces. External funding for the projects will be sought out at an appropriate stage in order to accelerate exploration and allow the Company to continue its focus on identifying new opportunities. As at 30 June 2008 your Company had over $2.6 million which will be sufficient to fund the planned exploration programmes for the next financial year.

Robert Reynolds Chairman

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REVIEW OF OPERATIONS - EXPLORATION Introduction Global Geoscience has a clear and focussed exploration strategy:

• Identify and acquire early-stage exploration projects in key mineral provinces that display the potential to host large, high-value mineral deposits.

• To rapidly advance its projects to the drill testing stage. • To seek external funding for its projects at an appropriate stage in order to accelerate

exploration. • To continue its focus on project generation.

Global’s project generation activities involve the use of in-house Intellectual Property (IP) coupled with the technical expertise of management to identify exploration target areas for investigation. The Intellectual Property (IP) is a regional structural method used to locate areas of increased prospectivity for mineralisation. The IP uses readily available and commonly used geoscientific data and is based on empirical observation whereby the data are processed and examined to identify “signatures” of the same type that have been observed to occur in proximity to many major mineral deposits. Relatively small areas (typically 300 sq km or less) are identified and interpreted by Global to have increased exploration potential. These areas then become the focus of intense exploration. All projects within the current portfolio were selected and acquired by the Company in this manner.

Porphyry Focus Many of the world’s largest copper, gold and base metal mines are located within a major tectonic zone that extends from Alaska through North, Central and South America to southern Chile. Most of the mineral deposits within this zone are closely associated with igneous rocks intruded into older sedimentary and volcanic sequences during Mesozoic and Tertiary times. Deposit types in the region include epithermal (Au-Ag), porphyry (Cu-Mo-Au), skarn (Cu-Pb-Zn-Mo) and manto (Pb-Zn). Peru, Mexico, Arizona and south-western USA are part of the same geological belt in age, rock type and types of mineral deposit. Porphyry deposits, because of their large size and frequent occurrence are a major source of copper, providing over half of world production and accounting for almost 60% of the known resource inventory. Production costs for porphyry deposits are often in the lowest quartile because of their amenability to low-cost bulk-tonnage operations. Porphyry and porphyry-related deposits also contribute a significant portion of world gold production. Consistent with our exploration strategy, Global has focussed its activities on the search for porphyry and porphyry-related deposit within Peru, Mexico and south-western USA.

REVIEW OF OPERATIONS

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In Peru, Global holds 100% interest in four copper-gold projects located in northern and central Peru. The projects lie within a linear province of porphyry copper-molybdenum-gold deposits which extend along the Andes mountain chain from Ecuador south through Peru into central Chile and Argentina. These deposits (with total pre-mining tonnage and grades) include La Granja (2.8Bt at 0.6%Cu), Toromocho (2Bt at 0.5%Cu), Constancia (0.4Bt at 0.44%Cu), Cuajone (1.5Bt at 0.76%Cu), Toquepala (2.1Bt at 0.6%Cu), Collahuasi (4.1Bt at 0.81%Cu), Chuquicamata (11.2Bt at 0.65%Cu), La Escondida (4.9Bt at 1.0%Cu), El Teniente (11.8Bt at 0.9%Cu), Los Bronces (5Bt at 0.8%Cu) and Alumbrera (0.8Bt at 0.52%Cu, 0.67g/tAu).

Figure 1. Location of Mancha Pampa and some major Andean porphyry copper deposits

In Arizona and Mexico, Global holds two porphyry projects: New Morenci and Los Graceros. These projects lie within a cluster of major porphyry copper-molybdenum deposits extending through south-western USA and northern Mexico. These deposits (with total production and resources) include Bingham (3.1Bt at 0.7%Cu), Mission (1Bt at 0.65%Cu), Ray (1.2Bt at 0.9%Cu), San Manuel (1.7Bt at 0.6%Cu), Twin Buttes (1.5Bt at 0.7%Cu), Resolution (1.3Bt at 1.5%Cu), Cananea (2Bt at 0.7%Cu), and La Caridad (2.5Bt at 0.5%Cu).


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Figure 2. Large Cu-Mo porphyry deposits of SW USA and Nth Mexico and Global’s projects.

Mancha Pampa, Peru (Global Geoscience 100%) Global has discovered porphyry-style copper-gold-silver mineralisation at the Quillcata prospect at Mancha Pampa in Peru and the company believes it has the potential to contain a large tonnage of copper-gold-silver mineralisation. There is no evidence of previous exploration at the Quillcata prospect. The Mancha Pampa project is located 150km southeast of Lima in the Yauyos Province of central Peru. Geologically, the project is located within the Andean porphyry belt, the largest copper producing province in the world, and about 100km southeast of Peru Copper Inc’s Toromocho Project (Proved and Probable Reserves of 1.3 billion tonnes at 0.51%Cu, 0.018%Mo, 7g/tAg) which is also based on porphyry mineralisation. Global holds granted tenements over an area of 14 sq km with applications covering an additional 121 sq km. Global holds 100% interest in all tenements. Part of the project area, including the Quillcata prospect, is subject to a 2.5% net smelter return royalty. During the year Global completed several phases of field work at Mancha Pampa comprising geological mapping, trenching and surface geochemical sampling (rock chip, soil and stream sediment). A highly altered and mineralised porphyry intrusive rock with associated anomalous levels of copper, gold, silver and molybdenum has been indentified. The copper zone of approximately 600m by 450m coincides with the eastern zone of porphyry and alteration. Soil samples are generally over 120ppm copper (Cu) in this zone and range up to 5,150ppm. The 150m wide, north-eastern third of the copper zone is generally more anomalous, with soil samples generally exceeding 1,000ppm Cu. Numerous rock chip samples have been collected within the copper zone, with copper contents averaging about 500ppm Cu. One grab sample contained 2.6% Cu.


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The area of the copper zone also contains anomalous molybdenum (Mo) in soils with values over 3ppm and up to 170ppm Mo. Rock chip samples within this zone average 3 to 4ppm with values up to 157ppm Mo. The 600m long and 50 to 100m wide gold zone occurs within the broader copper anomaly, along the western boundary of the zone of highest copper soil samples. Soil samples contain between 0.1 and 2.3g/t gold (Au). As sections of this soil anomaly are covered with thick scree, rock chip samples have only been taken at sporadic locations. However, where the gold zone has been rock sampled, values are variable. Average values are about 0.1 to 0.2g/t Au with the highest value being 4.0g/t Au (over a 5m width). The silver zone overlaps the eastern boundary of the copper zone and is up to 200m wide. Soil samples generally contain greater than 5g/t silver (Ag). Rock chip samples within this zone commonly exceed 2g/t Ag. One rock sample contained 26g/t Ag over a 20m width. The porphyry intrusive, alteration and copper anomaly at Quillcata are comparable in size and magnitude to a number of other Andean porphyry copper deposits. The potential therefore exists for significant mineralisation at the Quillcata prospect. A multi drill hole program is required to test for supergene and underlying primary copper mineralisation at Quillcata. Work is well underway to obtain the necessary environmental and regulatory approvals for drill testing Quillcata and a work agreement has been signed with the local Aquicha community.

Figure 3 . Geological map of the Quillcata prospect showing surface geochemical results.


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Lavanderos, Peru (Global Geoscience 100%) Global is targeting porphyry copper-molybdenum and related skarn mineralisation at the Lavanderos project in Northern Peru. The project is located 400 km north of Lima and 60 km northeast of the coastal city of Chimbote in a well established mineral district. The district hosts high-sulphidation gold deposits (Alto Chicama, Pierina) copper/molybdenum skarn deposits (Antamina) and copper/molybdenum porphyry deposits (Pashpap). Global holds granted tenements over an area of 13 sq km at Lavanderos West and 14 sq km at Lavanderos East. Both areas are subject to a 2.5% net smelter return royalty. Recent work by Global has confirmed the presence of strongly anomalous molybdenum (Mo), copper (Cu) and zinc (Zn) values in surface geochemical samples (stream sediment and rock chip) being shed from a two square kilometre area of intensely altered rocks and skarn. The stream geochemical anomaly comprises an inner zone of greater than 40pppm Mo and greater than 100ppm Cu within a broader halo of greater than 100ppm Zn.

New Morenci, Arizona USA (100% Global Geoscience) Global has identified and acquired tenure over a possible extension to the mineralised system that hosts the giant Morenci copper mine in Arizona. Global believes the New Morenci project has the potential to host a large tonnage of porphyry-related leachable copper mineralisation. The New Morenci project is located 250km east of Phoenix in south-east Arizona, USA and five kilometres north of the Morenci copper mine. Global holds granted tenements over an area of 7.6 sq km. The Morenci mine owned by Freeport-McMoRan Copper and Gold Inc/Sumitomo Corp. is one of the world’s largest copper producers with planned production of over 800 million pounds per annum. The mine exploits a porphyry-related deposit, ranked as the third largest of this style in the world for contained copper, with total recorded past production and current reserves of 6 billion tonnes at 0.42% copper. Global identified the New Morenci area as being highly prospective through a regional targeting study conducted over the Arizona-Mexico porphyry province. A program of reconnaissance surface exploration followed. The New Morenci area has been found to be characterised by strongly anomalous copper in stream and soil samples, dense fracturing of the bedrock and quartz/iron oxide veining – all positive indicators for porphyry-style mineralisation. Global has identified a copper-molybdenum soil anomaly over an area of approximately 1000m by 500m. Within this zone, copper values in the soil are mostly greater than 200ppm Cu (and up to 584ppm) and molybdenum values are greater than 5ppm Mo (and up to 8ppm). A zone of significant lead-zinc and silver soil anomalism has also been identified. These anomalies, together with a number of old mine workings, indicate the area also has potential for lead-zinc-silver mineralisation. The Lime Cap lead-zinc mine extracted minor production of ore in the 1940’s from a concordant 2 to 6m thick horizon containing 3 to10% lead, 7 to 25% zinc and about 120g/t silver.


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Figure 4. Geological map of the Morenci area showing the Morenci pit and Global’s New Morenci

project


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Figure 5. Geological map of the New Morenci project area showing the location of soil

geochemical anomalies. The zones of copper, lead-zinc and silver soil anomalies are currently being followed up by infill soil sampling, rock chip sampling and detailed geological mapping. Work has begun to obtain the necessary environmental and regulatory approvals for drill testing of the copper soil anomaly. Whilst it is expected to take up to 12 months to obtain the necessary permits to allow drilling over the whole target area, the Company is investigating the possibility of drilling sooner by positioning some holes close to existing roads thereby minimizing any surface disturbance.


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Camp Verde, Arizona USA (Global Geoscience 100%) Global is targeting porphyry copper-gold mineralisation at the Camp Verde project in Arizona where it has recently applied for tenements over an area of 3.7 sq km. Early-stage reconnaissance exploration has shown the presence of geochemical and alteration signatures suggestive of porphyry style mineralisation. The Squaw Peak project located 1.6km to the southeast, and outside of Global’s tenements, hosts porphyry copper-molybdenum mineralisation (eg. 176m @ 0.46% Cu, 204ppm Mo and 12g/t Ag).

Los Graceros, Mexico (Global Geoscience 100%) Prior exploration by Global at the Los Graceros project has identified geochemical, geophysical and geological characteristics that indicate the area has good potential to host porphyry copper-molybdenum style mineralisation. The Los Graceros project is located 100km northeast of Hermosillo, the capital city of Sonora State in northern Mexico. Global holds 100% interest in the 40 sq km tenement which is subject to a 2.5% net smelter return royalty. Much of the project area is covered by young (post-mineralisation) volcanic and sedimentary rocks that would conceal any potential mineralisation. Global has identified a distinct metal zonation around the margins of the younger cover rocks with a central zone of copper-molybdenum-gold surrounded by an outer zone of silver-lead-zinc. The copper-molybdenum-gold zone closely coincides with a zone of magnetic low which may be directly due to more intense alteration. The size, shape and metal values that define the metal zonation are comparable to other porphyry copper gold deposits in which the principal mineralised host rock is not exposed at surface. Global has recently entered into an exploration agreement with Canadian mining company Inmet Mining Corporation. Global has granted Inmet a 3-year option to acquire 51% of Global’s Mexican subsidiary company that holds the tenement. To maintain the option Inmet must spend US$2 million on exploration over the three year period including a minimum of $350,000 during the first year. Once Inmet have earned their 51% interest, Global may elect to contribute to future exploration expenditure in order to maintain its 49% interest or convert to a 20% interest that will be “free carried” by Inmet through to completion of feasibility. Inmet intend to commence exploration at Los Graceros with an extensive induced polarisation geophysical survey that should allow them to see through the younger cover rocks. This method is particularly effective in identifying large areas of disseminated sulphide minerals, as is typically found with porphyry-style mineralisation. Drilling will be required to test targets identified by the geophysical survey beneath the younger cover rocks.


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Figure 6. Geological map of the Los Graceros area showing a summary of previous exploration

results.


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Tokop, Nevada USA (Global Geoscience 100%) Global is targeting gold mineralisation within the Walker-Lane tectonic zone of southern Nevada. This zone hosts a number of large gold mines with total production exceeding 20 million ounces. Notable mines include Goldfield, Comstock, Bullfrog, Mineral Ridge, Borealis and Yerington. The Tokop project is located 330 km southeast of Reno and 80 km south of Tonopah in southern Nevada, USA. Global holds granted tenements over an area of 2.5 sq km which are subject to a 2.5% net smelter return royalty. Gold mineralisation at Tokop is exposed at surface within a series of northwest and northeast trending sheeted quartz veins, ferruginous-siliceous zones and disseminations developed within and immediately adjacent to a multi-phase intrusive. Work completed by Global at Tokop has defined two adjacent gold zones. The northern zone extends over an area of 400m by 150m while the southern zone is smaller at 200m by 150m. Soil values within the two zones are mostly greater than 60ppb Au but reach up to 680ppb (0.68ppm) Au. Of the 24 rock chip samples taken within the two zones, seven exceeded 0.5g/t Au and five exceeded 1.0g/t Au. The zone underlying the gold anomalies is considered to have potential to contain economic, oxidized, bulk tonnage gold mineralisation. Global plans to test the gold anomalous zones by digging five trenches totalling about 1,000m in length. The trenches will be dug into the bedrock and will allow for collection of continuous rock chip samples (channel samples) across the full width of the zones. Encouraging results will be followed up by drilling.

Nevada – Other Projects (Global Geoscience 100%) Global holds granted tenements over two areas in north-western Nevada where it has been targeting sediment hosted and intrusive related gold mineralisation. Dun Glen and Jersey Valley are located 20km southwest and 90km south of Winnemucca respectively. Results of recent field programs undertaken to follow-up on earlier positive results at both locations have downgraded the potential for either area to host near surface, large tonnage gold mineralisation.

Peru – Other Projects (Global Geoscience 100%) Global holds granted tenure over two other areas in central Peru. The Obispo and Hornera projects are located 40km and 130km southeast of the Mancha Pampa project respectively. Very little work was conducted on these projects during the year and several targets remain to be tested. At Obispo, Global identified a 600m by 700m soil zinc anomaly immediately adjacent to a major fault zone. At Hornera, the tenement straddles two areas of hydrothermal alteration that show similarities to the alteration zones developed around high-sulphidation epithermal gold deposits. The more favourable zones are outside of Global’s tenement and are held by a third party.


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Brown Mountain, NSW Australia (Global Geoscience 100%) Global is targeting massive sulphide mineralisation at the Brown Mountain project in southern New South Wales. The area is located 40 km north-northwest of Bega and 15 km southeast of Nimmitabel in southern New South Wales. Global holds one granted tenement covering an area of 21.7 sq km. During the year a single drill hole was completed to test the depth extension of a 300m long surface gossan. The drill hole passed through a wide fault zone around the target depth and no significant sulphide mineralisation was intersected.

Denham Range, Australia (Global Geoscience 100%) Global holds two granted tenements totalling 198 sq km over a copper-gold target at the Denham Range project. The project area is located 90 km west of Mackay in the Bowen Basin region of central Queensland. Previous explorers identified a 2 km long, 200-300m wide northeast trending structural corridor hosting numerous small and shallow historic workings developed on gossanous outcrops and mineralised shears/faults. The corridor displays strongly anomalous copper, gold and molybdenum in soil and rock chip samples. Global holds the north-eastern 1.4 km of the trend. Global intends to farm-out this project so that it can concentrate on its priority projects in the USA and Peru.

Canada Projects (Global Geoscience 100%) Global holds tenements over two diamond projects in south-western Canada. Previous exploration by Global identified kimberlitic indicator minerals in till at the Arcadia Valley project in Alberta and the Humboldt project in Saskatchewan. Recently, Global applied for a new, larger tenement at Arcadia Valley and allowed the original tenement to lapse. No work was undertaken on either of these projects during the year and Global continues to seek a partner to fund future exploration.

SCHEDULE OF TENEMENTS

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Project ID Name Country Status Grant Date Expiry Date Area (km2) Holder Hornera 01-02673-04 Anazo 1 Peru Granted 17/11/2004 N/A 2 Paradigm Peru SA Hornera 01-02741-04 Anazo 3 Peru Granted 25/11/2004 N/A 10 Paradigm Peru SA Hornera 01-02742-04 Anazo 4 Peru Granted 6/12/2004 N/A 10 Paradigm Peru SA Lavanderos 01-02664-04 Lavanderos 1 Peru Granted 16/03/2005 N/A 5 Paradigm Peru SA Lavanderos 01-02662-04 Lavanderos 2 Peru Granted 16/03/2005 N/A 8 Paradigm Peru SA Lavanderos 01-02658-04 Mirador 1 Peru Granted 15/11/2004 N/A 10 Paradigm Peru SA Lavanderos 01-02657-04 Mirador 2 Peru Granted 15/11/2004 N/A 4 Paradigm Peru SA Mancha Pampa 01-02663-04 Quillcata 1 Peru Granted 15/11/2004 N/A 10 Paradigm Peru SA Mancha Pampa 01-02655-04 Quillcata 2 Peru Granted 27/10/2004 N/A 4 Paradigm Peru SA Mancha Pampa 01-00332-08 Quillcata 3 Peru Application N/A N/A 7 Paradigm Peru SA Mancha Pampa 01-00333-08 Quillcata 4 Peru Application N/A N/A 6 Paradigm Peru SA Mancha Pampa 01-00334-08 Quillcata 5 Peru Application N/A N/A 6 Paradigm Peru SA Mancha Pampa 01-00335-08 Quillcata 6 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00336-08 Quillcata 7 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00337-08 Quillcata 8 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00339-08 Quillcata 10 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00340-08 Quillcata 11 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00341-08 Quillcata 12 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00342-08 Quillcata 13 Peru Application N/A N/A 7 Paradigm Peru SA Mancha Pampa 01-00343-08 Quillcata 14 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00330-08 Quillcata 15 Peru Application N/A N/A 6 Paradigm Peru SA Mancha Pampa 01-00344-08 Quillcata 16 Peru Application N/A N/A 10 Paradigm Peru SA Mancha Pampa 01-00338-08 Quillcata 17 Peru Application N/A N/A 9 Paradigm Peru SA Obispo 01-02674-04 Terciopelo 1 Peru Granted 17/11/2004 N/A 10 Paradigm Peru SA Obispo 01-02675-04 Terciopelo 2 Peru Granted 16/11/2004 N/A 10 Paradigm Peru SA Los Graceros 082/29198 Los Graceros Mexico Granted 16/03/2005 15/03/2055 40.31 Paradigm Minerals Mexico New Morenci MP1-MP91 New Morenci USA Granted 30/04/2008 N/A 7.6 Paradigm Minerals USA Camp Verde CV1-CV47 Camp Verde USA Granted 28/06/2008 N/A 3.7 Paradigm Minerals USA Tokop TK 1-34 Tokop USA Granted 29/11/2004 N/A 2.5 Paradigm Minerals USA Dun Glen AU 1-36,39-40 Auburn USA Granted 19/10/2004 N/A 2.9 Paradigm Minerals USA

Dun Glen DG 1-14,19-32,37-64 Dun Glen USA Granted 19/10/2004 N/A 4.5 Paradigm Minerals USA

Jersey Valley JV 1-14 Jersey Valley USA Granted 30/12/2004 N/A 1.2 Paradigm Minerals USA

SCHEDULE OF TENEMENTS

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Arcadia Valley 80357301 Arcadia Valley Canada Application N/A N/A 82.3 Paradigm Canadian Diamonds Humboldt S137737 Humboldt 2 Canada Granted 10/11/2004 9/11/2008 15.36 Paradigm Canadian Diamonds Brown Mt EL 7126 Brown Mt Australia Granted 11/04/2008 10/04/2010 21.7 Banlona Pty Ltd Cymbric Vale EL 6403 Cymbric Vale Australia Granted 20/04/2005 19/04/2009 211 Paradigm Mexico Pty Ltd Cymbric Vale EL 6834 Cymbric Vale Ext Australia Granted 19/07/2007 18/07/2009 3.6 Paradigm Mexico Pty Ltd Denham Range EPM 14385 Denham Range 1 Australia Granted 15/12/2004 14/12/2009 96 Banlona Pty Ltd Denham Range EPM 16329 Denham Range 2 Australia Granted 29/05/2008 28/05/2013 102.3 Banlona Pty Ltd Guyra ELA 3588 Guyra Australia Application N/A N/A 68.2 Banlona Pty Ltd

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DIRECTORS REPORT Your Directors present the financial report of the Company for the period ended 30 June 2008. The following persons hold office as Directors at the date of this report and throughout the period. Their qualifications and experience are:

Mr. Robert Reynolds, Chairman Robert Reynolds is a Chartered Accountant and has been involved in the mining and exploration industry for 28 years. Robert has been involved with exploration, development and mining companies with operations in Australia, Africa, New Zealand, New Guinea, Vanuatu and Fiji. Those companies included Delta Gold Ltd, Hampton Gold Mining Areas PLC, Golden Plateau NL and Alkane Exploration NL. He joined Delta Gold in 1984 and was responsible for corporate planning, finance and administration. He was involved with the development of the Granny Smith Mine and Kanowna Belle mine in Western Australia and the Hartley Platinum Mine in Zimbabwe. He was an Executive Director from 1987 to 1996.

He is currently Chairman of Avoca Resources Ltd in Australia and a director of Exeter Resource Corporation in Canada and has held board positions with Ballarat Goldfields Ltd, Highlake Resources Ltd and Triton resources Ltd.

Mr. Bernard Rowe, Managing Director Bernard is a qualified geologist with 17 years international experience in mineral exploration. He spent seven years exploring for diamonds with Ashton Mining most of which was spent in Scandinavia and West Africa. He played a key role in the discovery of a number of diamond bearing kimberlite pipes in Finland and went on to manage Ashton’s activities in the West African nation of Mali. Since leaving Mali in 1996 Bernard has based himself in Sydney and has mostly been involved in gold and base metal exploration. During this period he has explored for massive sulphide base metal deposits in New South Wales, gold and copper-gold deposits in eastern Australia, diamond deposits in northern Australia, base metal deposits in Sweden and gold deposits in Nevada.

Bernard holds a BAppSc (Hons) degree in geology, is a member of the Australian Institute of Geoscientists and a founding shareholder of Global Geoscience Ltd. Mr Patrick Elliott, Director Patrick Elliott is a company director specialising in the resources sector with 35 years experience in investment and corporate management. His early career was at Consolidated Gold Fields Australia Limited and covered investment analysis and management, minerals marketing (copper, tin, rutile and zircon). In 1979 he went into investment banking and became Head of Corporate Finance for Morgan Grenfell Australia Limited in 1982. Pat subsequently became Managing Director of Natcorp Investments Ltd in 1986 which owned a number of manufacturing businesses. After its takeover he became an active early stage venture capital investor with an emphasis on resources. Pat is Chairman of Argonaut Resources NL, Australia Oriental Minerals NL and MIL Resources Limited. He is also a director of SAPEX Limited, Crossland Uranium Mines Limited and a number of privately owned companies. Pat holds an MBA in Mineral Economics (Macquarie University) and B Comm. (University of NSW).

DIRECTORS REPORT

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Mr. Peter Nicholson, Technical Director Peter is a qualified geologist with 30 years experience in mining and exploration within Australia and overseas. He spent his early career with Geopeko and Eupene Exploration exploring for and mining gold and base metal deposits in northern Australia. In 1994 he joined Savage Resources where he later became General Manager – Exploration and played an integral role in the development of Savage’s exploration in North and South America. Peter has been involved in discovery and/or resource increases at Tanami, Gecko, Argo, Woodcutters, Cosmo Howley and Endeavor in Australia and at Chorobal in Peru.

Peter holds a BSc (Hons) degree in geology and is a fellow of the AusIMM and a Chartered Professional (CP) Geologist. He is a founding shareholder of Global Geoscience Ltd.

Other Directors On 23rd August 2007, Mr Richard Austen and Mr Ray Soper resigned as directors of the company prior to the company seeking listing on the Australian Stock Exchange. Directors' Interests in Shares and Options Directors’ interests in shares and options as at 30 June 2008 are set out in the table below. Between the end of the financial year and the date of this report, there has been no change in the shareholding.

Director Shares Directly

and Indirectly

Held

Options

R.Reynolds 1,404,388 1,053,290B. Rowe 948,470 1,711,351P. Elliott 1,149,153 861,864P. Nicholson 2,744,140 3,058,103

Activities The continuing principal activity of the Company is the exploration for economic deposits of minerals.

Results The net result of operations after applicable income tax expense was a loss of $641,307.

Dividends No dividends were paid or proposed during the year.

Review of Operations A review of the operations of the Company during the financial period and the results of those operations are contained in pages 5 to 15 in this report.

DIRECTORS REPORT

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Corporate Structure Global Geoscience Limited is a limited company that is incorporated and domiciled in Australia.

Employees The Company had five employees as at 30 June 2008. The Company also uses contract geologists and other consultants as required.

Significant Changes The Directors are not aware of any significant changes in the state of affairs of the Company occurring during the financial period, other than as disclosed in this report.

Matters Subsequent to the End of the Financial Period Other than where stated in this report, there were at the date of this report no matters or circumstances which have arisen since 30 June 2008 that have significantly affected or may significantly affect: i) the operations of the Company, ii) the results of those operations, or iii) the state of affairs of the Company,

Likely Developments and Expected Results As the Company’s areas of interest are still at an early stage of exploration, it is not possible to postulate likely developments and any expected results. The Company aims to discover and evaluate base and precious metal mineral deposits.

Remuneration Report - Audited The remuneration report is set out under the following main headings: (a) Principles used to determine the nature and amount of remuneration (b) Key management personnel (c) Details of remuneration (d) Service agreements (e) Share-based compensation. (a) Principles used to determine the nature and amount of remuneration

The objective of the company’s remuneration framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with achievement of strategic objectives and the creation of value for shareholders. The Board believes that executive remuneration satisfies the following key criteria:

competitiveness and reasonableness acceptability to shareholders performance linkage / alignment of executive compensation transparency capital management.

These criteria result in a framework which can be used to provide a mix of fixed and variable remuneration, and a blend of short and long-term incentives in line with the Company’s limited financial resources. Key management personnel’s remuneration is not linked to the Group’s performance due to the nature of the Group’s activities.

DIRECTORS REPORT

21

Board and Management Fees and payments to the non-executive directors and management reflect the demands which are made on, and the responsibilities of, the directors and the management. Such fees and payments are reviewed annually by the Board. The executive directors and company officers are entitled to receive options under the company’s employee share option scheme.

(b) Key management personnel The following persons were key management personnel of the Company during the financial year: Name: Position held: Robert Reynolds Chairman Bernard Rowe Managing Director Patrick Elliott Director Peter Nicholson Technical Director Joanna Morbey Company Secretary

(c) Details of remuneration

Directors’ and Executives’ Remuneration Directors are entitled to remuneration out of the funds of the Company but the remuneration of the Non-Executive Directors may not exceed in any year the amount fixed by the Company in general meeting for that purpose. The aggregate remuneration of the Non-Executive Directors has been fixed at a maximum of $200,000 per annum to be apportioned among the non-executive directors in such a manner as they determine (refer below). Directors are also entitled to be paid reasonable travelling, accommodation and other expenses incurred in consequence of their attendance at Board meetings and otherwise in the execution of their duties as directors. Details of the nature and amount of each element of the remuneration of each of the directors of Global Geoscience Limited and each of the five senior executives of the company and the consolidated entity who received the highest emoluments during the year ended 30 June 2008 are set out in the following tables.

DIRECTORS REPORT

22 Global Geoscience Limited

Table 1: Director and senior executive remuneration

2008 Short-term employee benefits

Post employment

Benefits Long Term Benefits

Share Based

Payments

Cash, Salary and Consulting

fees Cash Bonus

Non-Monetary benefits

Super-annuation

Long service Leave

Termination benefits Options Total

Proportion of Remuneration

that is performance

based

% of value of remuneration that consists

of options

Directors:

R.Reynolds

18,182

- - 1,818

- - -

20,000 - -

B.Rowe

145,420

- - 445

- - 80,000

225,865 - 36.2%

P.Elliott

18,182

- - 1,818

- - -

20,000 - -

P.Nicholson

120,422

- - 445

- - 80,000

200,867 - 39.8%

Key personnel:

J.Morbey

52,909

- - 2,735

- - 40,000

95,644 - 41.8%

TOTAL Remuneration

355,115

- - 7,261

- - 200,000

562,376 - -

2007 Short-term employee benefits

Post employment

Benefits Long Term Benefits

Share Based

Payments

Cash, Salary and Consulting

fees Cash Bonus

Non-Monetary benefits

Super-annuation

Long service Leave

Termination benefits Options Total

Proportion of Remuneration

that is performance

based

% of value of remuneration that consists

of options

Directors:

R.Reynolds

18,000

- - -

- - -

18,000 - -

P.Nicholson

35,000

- - -

- - -

35,000 - -

P.Elliott

18,000

- - -

- - -

18,000 - -

D.Austen

18,000

- - -

- - -

18,000 - -

R.Soper

30,000

- - -

- - -

30,000 - - Key personnel:

J.Morbey

4,374

- - -

- - -

4,374 - -

TOTAL Remuneration

123,374

- - -

- - -

123,374 - -

Options and shares granted as part of remuneration Options granted as a part of a director and executive remuneration are valued using a Black and Scholes option-pricing model, which takes account of factors including the option exercise price,

DIRECTORS REPORT


the share price at time of grant, volatility of the underlying share price, the risk-free interest rate and the expected life of the option. Fair value of options The fair value of each option is estimated on the date of grant using a Black & Scholes option-pricing model with the relative weighted average assumptions applicable to each grant made. (d) Service agreements Remuneration and other terms of employment for the directors and executives are formalised in service agreements.

All contracts with executives may be terminated early by either party with the stipulated number of months notice, subject to termination payments as detailed below. The two current service agreements with directors are:

i. Lydail Pty Limited a company associated with Mr Bernard Rowe. During the consultancy period either party may terminate the agreement by three months written notice. The company must pay to the consultant a termination payment of an amount equal to 3 months fees.

ii. Nicholson Geologist Pty Limited a company associated with Mr Peter Nicholson. During the consultancy period either party may terminate the agreement by three months written notice. The company must pay to the consultant a termination payment of an amount equal to 3 months fees.

(e) Share Options At 30 June 2008 the company had granted options over 5,000,000 unissued shares to directors, management and consultants, all issued in the 2008 financial year and expire 31 August 2012. The options are exercisable at $0.25 per share at any time prior to expiry. Directors’ Interests The relevant interest of each Director (including their associates) in the share capital of the company as at 30 June 2008 is set out in note 17 to the financial statements. Any Options included in directors’ and executives’ remuneration are treated as follows: Fair values have been assessed using the Black and Scholes option valuation methodology which takes into account the exercise price, the term of the option, the vesting and performance criteria, the impact of dilution, the non-tradable nature of the options, the current price and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option. No discount has been applied. Share Capital and Options A detailed breakdown of the company’s capital, including options (unquoted options and employee options) is contained in Note 13 to the Financial Statements. Meetings of Directors Director’s attendance at Directors meetings are shown in the following table:

DIRECTORS REPORT


Director Meetings Eligible

to Attend

Meetings Attended

Rob Reynolds 11 11Pat Elliott 11 7Bernard Rowe 10 10Peter Nicholson 11 8Dick Austen * 1 1Ray Soper * 1 1

*resigned 23 August 2007 Non-Executive Directors, Mr Elliott and Mr Reynolds are members of the Company’s Audit Committee. The Committee reviews the Company’s financial systems, accounting policies, half-year and annual financial statements. There was one Audit Committee meeting during the period and Mr Elliott and Mr Reynolds were in attendance. Directors, Officers, Senior Employees and Consultants Share Option Plan The Company has established the Global Geoscience Ltd Employees and Officers Share Option Plan (“the Plan”) to assist in the attraction, retention and motivation of the Company’s directors, officers, employees and senior consultants. As at the date of this report, the following options have been issued: Name No of Options Date Issued BA Rowe 1,000,000 1 January 2008 PM Nicholson 1,000,000 1 January 2008 JE Morbey 500,000 1 January 2008 These current options have an exercise price of $0.25 and an exercise date of 31st August 2012. A summary of the rules of the Plan is as follows: 1. The Board has the discretion to determine who is entitled to participate in the Plan. 2. If permitted by the Board, options may be issued to an employee’s nominee. (for example, to a spouse or family company) 3. Each option is to subscribe for one fully paid ordinary share in the Company. An option is exercisable at any time from its date of issue. 4. The Board will fix the Exercise Price of the option. 5. The options may be subject to such other restrictions on exercise as may be fixed by the Board prior to the granting of the option. Indemnification and Insurance of Directors and Officers During the financial year, the Company paid premiums in respect of a contract insuring all the Directors against legal costs incurred in defending proceedings for conduct involving: 1) willful breach of duty; or 2) a contravention of sections 182 or 183 of the Corporations Act 2001, as permitted by section 199B of the Corporations Act 2001. It is a term of the policy that the Company cannot disclose the premium paid for the cover.

DIRECTORS REPORT


Environmental Performance GSC holds exploration licences issued by the Mines Departments in New South Wales and Queensland which specify guidelines for environmental impacts in relation to exploration activities. The licence conditions provide for the full rehabilitation of the areas of exploration in accordance with the various Mines Departments’ guidelines and standards. There have been no known breaches of the licence conditions.

Audit and Non-Audit Services The directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The nature and scope of each type of non-audit service provided means that auditor independence was not compromised. Barnes Dowell James received $9,550 during the course of the year, being payment for the preparation of an Independent Accountants Report for the Prospectus dated 6th November 2007. Auditor’s Independence Declaration A copy of the auditor’s independence declaration as required under section 307C of the Corporations act forms part of this report and is set out on page 52. Signed at Sydney this 22nd day of September 2008 in accordance with a resolution of the Directors.

ROBERT REYNOLDS Chairman

INCOME STATEMENT YEAR ENDED 30 JUNE 2008


Consolidated Parent Entity Consolidated Parent Entity Note 2008 2008 2007 2007

$ $ $ $

REVENUE 151,277 150,944 18,770 18,770 Administration expenses 165,517 140,742 46,786 45,938 Consultant expenses 109,888 94,158 147,200 147,200 Depreciation 3,018 3,018 278 278 Directors fees 42,284 40,000 92,000 92,000 General expenses Goodwill written off Exploration expenditure previously written off now capitalised

3,581 179,101

(107,381)

3,581 -

(107,381)

2 -

-

2 -

- Exploration written off 120,735 18,872 - - Occupancy expenses 22,020 22,020 17,759 17,759 Option based payment 200,000 200,000 - - Salaries and employee benefits expense 43,660 43,660 - - Travel and accommodation 10,161 10,161 14,509 14,509

(LOSS) BEFORE INCOME TAX EXPENSE (641,307) (317,887) (299,764) (298,916)

INCOME TAX EXPENSE 0 0 0 0

(LOSS) AFTER INCOME TAX EXPENSE (641,307) (317,887) (299,764) (298,916)

NET (LOSS) ATTRIBUTABLE TO MEMBERS OF GLOBAL GEOSCIENCE LIMITED

(641,307)

(317,887)

(299,764)

(298,916)

Basic loss per share (cents per share) ($0.018) ($0.67)Diluted loss per share (cents per share) ($0.018) ($0.67)

BALANCE SHEET AT 30 JUNE 2008



$ $ $ $

CURRENT ASSETS

Cash assets 5 2,654,338 2,619,736 53,465 53,460 Receivables 6 55,867 55,867 66,977 66,976

TOTAL CURRENT ASSETS 2,710,205 2,675,603 120,442 120,436

NON-CURRENT ASSETS

Shares in controlled entities 7 - 792,626 - 6 Tenement security deposits 8 12,950 450 - - Plant and equipment 9 11,057 11,057 464 464 Deferred exploration and evaluation expenditure 10

1,333,662

-

-

-

Formation expenses 19,651 - - - Loans to controlled entities 11 - 933,305 - 2,096

TOTAL NON-CURRENT ASSETS 1,377,320 1,737,438 464 2,566

TOTAL ASSETS 4,087,525 4,413,041 120,906 123,002

CURRENT LIABILITIES

Payables 12 104,721 104,721 82,762 82,762

Funds held on deposit - - 71,314 71,314

TOTAL CURRENT LIABILITIES 104,721 104,721 154,076 154,076

TOTAL LIABILITIES 104,721 104,721 154,076 154,076

NET ASSETS 3,982,804 4,308,320 (33,170) (31,074)

EQUITY

Issued capital 13 5,165,063 5,165,063 907,782 907,782

Reserves 14 400,000 400,000 - - Accumulated losses 15 (1,582,259) (1,256,743) (940,952) (938,856)

TOTAL EQUITY 3,982,804 4,308,320 (33,170) (31,074)

STATEMENT OF CASH FLOWS YEAR ENDED 30 JUNE 2008



$ $ $ $

CASH FLOWS FROM OPERATING ACTIVITIES

Payment to suppliers and employees (334,937) (261,598) (148,027) (147,179) Other income 25,002 25,002 18,000 18,000 Interest received 83,816 83,482 770 770

NET CASH FLOWS (USED IN) OPERATING ACTIVITIES

(226,119) (153,114) (129,257) (128,409)

CASH FLOWS FROM INVESTING ACTIVITIES

Investment in subsidiaries - - - Purchase of plant and equipment (13,611) (13,611) - - Expenditure on mining exploration (758,844) - - - Tenement security deposits (12,950) (450) 5,000 5,000 Exploration expenditure previously Written off now capitalised

(107,381)

(107,381)

-

-

NET CASH FLOWS (USED IN) INVESTING ACTIVITIES

(892,786) (121,442)

5,000 5,000

CASH FLOWS FROM FINANCING ACTIVITIES

Advances to controlled entities - (898,602) - (3,912) Formation expenses (19,651) - - - Split up of capital - - 91,859 94,918 Proceeds from issue of shares 4,173,823 4,173,823 - - Proceeds from issue of options 235,725 235,725 74,766 74,766 Equity raising expenses (670,119) (670,119) - -

NET CASH FLOWS FROM FINANCING ACTIVITIES

3,719,778 2,840,827 166,625 165,772

Net increase in cash held 2,600,873 2,566,271 42,368 42,363

Add opening cash brought forward 53,465 53,465 11,097 11,097

CLOSING CASH CARRIED FORWARD 2,654,338 2,619,736 53,465 53,460

STATEMENT OF CHANGES IN EQUITY YEAR ENDED 30 JUNE 2008


Attributable to the shareholders of Global Geoscience Ltd

CONSOLIDATED Issued Capital

$

Accumulated Losses

$

Reserves

$

Total Equity

$

AT 1 JULY 2006 623,105 (641,188) - (18,083)

Loss for the period (299,764) - (299,764)

Issue of share capital, net of transaction costs 230,755 - - 230,755

Issue of options 53,922 - - 53,922

AT 30 JUNE 2007 907,782 (940,952) - (33,170)

AT 1 JULY 2007 907,782 (940,952) - (33,170)


Share based payment (option) 400,000 400,000

Issue of share capital, net of transaction costs 4,257,281 4,257,281

AT 30 JUNE 2008 5,165,063 (1,582,259) 400,000 3,982,804

Attributable to the shareholders of Global Geoscience Ltd

PARENT Issued Capital

$

Accumulated Losses

$

Reserves

$

Total Equity

$

AT 1 JULY 2006 623,105 (639,940) - (16,835)


Issue of share capital, net of transaction costs 230,755 - - 230,755

Issue of options 53,922 - - 53,922

AT 30 JUNE 2007 907,782 (938,856) - (31,074)

AT 1 JULY 2007 907,782 (938,856) - (31,074)


Share based payment (option) 400,000 400,000

Issue of share capital, net of transaction costs 4,257,281 4,257,281

AT 30 JUNE 2008 5,165,063 (1,256,743) 400,000 4,308,320

NOTES TO AND FORMING PART OF THE ACCOUNTS

30

Contents of the notes to the financial statements

1. Summary of significant accounting policies 2. Revenue from Ordinary activities 3. Income tax 4. Auditors remuneration 5. Cash and Cash equivalents 6. Receivables – Current 7. Shares in Controlled Entities 8. Security Deposits 9. Plant and equipment 10. Deferred exploration expenditure and costs 11. Loans to Controlled Entities 12. Current Liabilities – Payables 13. Contributed Equity 14. Reserves 15. Loss per share 16. Remuneration Benefits 17. Related Party Disclosures 18. Financial Report by Segment 19. Contingent Liabilities 20. Employee Entitlements 21. Financial Instruments 22. Commitments 23. Subsequent Events 24. Statement of Cash flows 25. Financial Risk Management Objectives and Policies 26. Pending Application of Accounting Standards Affected 27. Corporate Information



1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of preparation The financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001 and Australian Accounting Standards. The financial report has been prepared on a historical cost basis except for land and buildings, which have been measured at fair value.

(b) Statement of compliance The financial report has been prepared and complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (“AIFRS”). Compliance with AIFRS ensures that the financial report, comprising the financial statements and notes thereto, complies with International Financial Reporting Standards (“IFRS”).

(c) Basis of consolidation The consolidated financial statements comprise the financial statements of Global Geoscience Limited (GSC or the “Company”) and its subsidiaries (“the Group”) as at 30 June each year. The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist. All inter-company balances and transactions, including unrealised profits arising from intra-group transactions, have been eliminated in full. Subsidiaries are fully consolidated from date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.

(d) Property, plant and equipment Plant and equipment is stated at cost less accumulated depreciation and any impairment in value. Land and buildings are measured at fair value less accumulated depreciation. Depreciation is calculated on a straight-line basis over the estimated useful life of the asset as follows: plant and equipment – 4 years Impairment The carrying values of plant and equipment are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. An item of plant and equipment is derecognised upon disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the item) is included in the income statement in the period the item is derecognised.

(e) Intangible assets Acquired both separately and from a business combination Intangible assets acquired separately are capitalised at cost and from a business combination are capitalised at fair value as at the date of acquisition. Following recognition, the cost model is applied to the class of intangible assets. The useful lives of these intangible assets are assessed to be either finite or indefinite. Intangible assets, excluding development costs, created within the business are not capitalised and expenditure is charged against profits in the period in which the expenditure is incurred.



Intangible assets are tested for impairment where an indicator of impairment exists, and in the case of indefinite life intangibles annually, either individually or at the cash generating unit level. Useful lives are also examined on an annual basis and adjustments, where applicable, are made on a prospective basis.

(g) Recoverable amount of assets At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. Where an indicator of impairment exists, the Group makes a formal estimate of recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is written down to its recoverable amount. Recoverable amount is the greater of fair value less costs to sell and value in use.

(h) Investments All investments are initially recognised at cost, being the fair value of the consideration given and including acquisition charges associated with the investment. After initial recognition, investments, which are classified as held for trading and available-for-sale, are measured at fair value. Gains or losses on investments held for trading are recognised in the income statement. Gains or losses on available-for-sale investments are recognised as a separate component of equity until the investment is sold, collected or otherwise disposed of, or until the investment is determined to be impaired, at which time the cumulative gain or loss previously reported in equity is included in the income statement. Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity when the Group has the positive intention and ability to hold to maturity. Investments intended to be held for an undefined period are not included in this classification. Other long-term investments that are intended to be held-to-maturity, such as bonds, are subsequently measured at amortised cost using the effective interest method. Amortised cost is calculated by taking into account any discount or premium on acquisition, over the period to maturity. For investments carried at amortised cost, gains and losses are recognised in income when the investments are derecognised or impaired, as well as through the amortisation process. For investments that are actively traded in organised financial markets, fair value is determined by reference to Stock Exchange quoted market bid prices at the close of business on the balance sheet date. For investments where there is no quoted market price, fair value is determined by reference to the current market value of another instrument which is substantially the same or is calculated based on the expected cash flows of the underlying net asset base of the investment. Purchases and sales of financial assets that require delivery of assets within the time frame generally established by regulation or convention in the market place are recognised on the trade date, being the date that the Group commits to purchase the asset.

(i) Exploration, evaluation, development and restoration costs Exploration and evaluation Exploration and evaluation expenditure incurred by or on behalf of the Group is accumulated separately for each area of interest. Such expenditure comprises net direct costs and an appropriate portion of related overhead expenditure, but does not include general overheads or administrative expenditure not having a specific connection with a particular area of interest.



Exploration and evaluation costs in relation to separate areas of interest for which rights of tenure are current are brought to account in the year in which they are incurred and carried forward provided that:

such costs are expected to be recouped through successful development and exploitation of the area, or alternatively through its sale; or exploration and/or evaluation activities in the area have not yet reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves.

Once a development decision has been taken, all past and future exploration and evaluation expenditure in respect of the area of interest is aggregated within costs of development. Exploration and evaluation – impairment The Directors assess at each reporting date whether there is an indication that an asset has been impaired and for exploration and evaluation cost whether the above carry forward criteria are met. Accumulated costs in respect of areas of interest are written off or a provision made in the Income Statement when the above criteria do not apply or when the Directors assess that the carrying value may exceed the recoverable amount. The costs of productive areas are amortised over the life of the area of interest to which such costs relate on the production output basis, provisions would be reviewed and if appropriate, written back. Development Development expenditure incurred by or on behalf of the Group is accumulated separately for each area of interest in which economically recoverable reserves have been indentified to the satisfaction of the directors. Such expenditure comprises net direct costs and, in the same manner as for exploration and evaluation expenditure, an appropriate portion of related overhead expenditure having a specific connection with the development property. All expenditure incurred prior to the commencement of commercial levels of production from each development property is carried forward to the extent to which recoupment out of revenue to be derived from the sale of production from the relevant development property, or from the sale of that property, is reasonably assured. No amortisation is provided in respect of development properties until a decision has been made to commence mining. After this decision, the costs are amortised over the life of the area of interest to which such costs relate on a production output basis. Restoration Provisions for restoration costs are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. Remaining mine life In estimating the remaining life of the mine at each mine property for the purpose of amortisation and depreciation calculations, due regard is given not only to the volume of remaining economically recoverable reserves but also to limitations which could arise from the potential for changes in technology, demand, product substitution and other issues that are inherently difficult to estimate over a lengthy time frame.



(k) Trade and Other Receivables Trade receivables, which generally have 5-30 day terms, are recognised and carried at original invoice amount less an allowance for any uncollectible amounts.

(l) Cash and cash equivalents Cash and short-term deposits in the balance sheet comprise cash at bank and in hand and short-term deposits with an original maturity of six months or less. For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as defined above.

(m) Other provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the income statement net of any reimbursement. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

(n) Employee Entitlements Liabilities for wages and salaries are recognised and are measured as an amount unpaid at the reporting date at current pay rates in respect of employee’s services up to that date. Current employee contracts do not entitle them to annual leave and long service leave. A liability in respect of superannuation at the current superannuation guarantee rate has been accrued at the reporting date.

(o) Share-based payments An employee share option scheme has been established where selected employees of the Company are issued with options over ordinary shares in Global Geoscience Ltd. The options, issued for nil consideration, are issued in accordance with a performance review by the Directors. The options cannot be transferred and will not be quoted on the ASX. There were 2,500,000 options issued in January 2008 which expire on 31st August 2012, which are exercisable at 25 cents and which have vested. Options expire if not exercised 90 days after a participant resigns from the Company. The cost of these equity-settled transactions is determined by reference to the fair value at the date at which they are granted. The fair value of the options is determined by using the Black and Scholes option pricing model. The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (a) the extent to which the vesting period has expired and (b) the number of awards that, in the opinion of the Directors of the Company, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value at grant date. Where an equity-settled award is cancelled, it is



treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. The Company has applied the requirements of AASB 1 “First-time Adoption of Australian Equivalents to International Financial Reporting Standards” in respect of equity-settled awards and has applied AASB 2 “Share-Based Payments” only to equity instruments granted after 7 November 2002 that had not vested on or before 1 January 2005.

(q) Revenue Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognised: Sale of goods Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer and can be measured reliably. Risks and rewards are considered passed to the buyer at the time of delivery of the goods to the customer. Interest Revenue is recognised as the interest accrues (using the effective interest method, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument) to the net carrying amount of the financial asset.

(r) Income tax Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the balance sheet date. Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised for all taxable temporary differences:

except where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, except where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilised:

except where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.



Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date. Income taxes relating to items recognised directly in equity are recognised in equity and not in the income statement.

(s) Other taxes Revenues, expenses and assets are recognised net of the amount of GST except:

where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and receivables and payables are stated with the amount of GST included.

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet. Cash flows are included in the Cash Flow Statement on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authorities are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.

(t) Currency Both the functional and presentation currency is Australian dollars (A$).

(u) Investment in Controlled Entities The Company’s investment in its controlled entities is accounted for under the equity method of accounting in the Company’s financial statements. Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $2. REVENUE FROM ORDINARY ACTIVITIES Interest received – other persons/corporation 126,275 125,942 770 770Other income 25,002 25,002 18,000 18,000

151,277 150,944 18,770 18,770 3. INCOME TAX (a) Income tax expense Current tax - - - - Deferred tax - - - - (Over) under provision in prior years - - - -

- - - -Income tax expense is attributable to: Profit from continuing operations - - - -



Aggregate income tax expense - - - -

(b) Numerical reconciliation of income tax expense to prima facie tax payable Losses from continuing operations before income tax expense

(641,307) (317,887) (299,764) (298,916)

Tax at the Australian tax rate of 30% (192,392) (95,366) (89,929) (89,674)Tax effect of amounts which are not deductible (taxable) in calculating taxable income: Non-allowable deductions 54,913 1,183 4 4Option based payments 60,000 60,000 - -

Income taxes not brought to account (77,479) (34,183) (89,925) (89,670) (c) Current tax liabilities

Balance at beginning of year - - - -Income tax paid - - - -Current year’s income tax on profit - - - -Under (over) provided in prior year - - - -

Balance at end of year - - - -

No provision for income tax is considered necessary in respect of the Company for the period ended 30 June 2008. No recognition has been given to any future income tax benefit which may arise from operating losses not claimed for tax purposes. The Company has estimated its losses not claimed of $1,126,270. These amounts have not been brought to account in calculating any future tax benefit. A benefit of 30% of approximately $337,881 will only be obtained if:

the Company derives future assessable income of a nature and of an amount sufficient to enable the benefit from the deductions for the losses to be realised, the Company continues to comply with the conditions for deductibility imposed by the law, and no changes in tax legislation adversely affect the Company in realising the benefit from the deductions for the losses, i.e. current tax legislation permits carried forward tax losses to be carried forward indefinitely.

No franking credits are available for subsequent years. Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $4. AUDITORS’ REMUNERATION

Total amounts receivable by the current auditors of the Company for:

Audit of the Company’s accounts 8,200 8,200 - -Other services – Independent Accountant’s Report for IPO Prospectus 9,550 9,550

- -

17,750 17,750 - -



Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $5. CASH AND CASH EQUIVALENTS Bank operation account 132,023 97,420 53,465 53,460Bank deposits 2,522,315 2,522,315 - - 2,654,338 2,619,735 53,465 53,460

6. RECEIVABLES – CURRENT Interest receivable 42,459 42,459 - -Prepaid Insurance 12,162 12,162 - -GST and WHT receivable 1,246 1,246 7,466 7,466Loans to associated companies - - 59,510 59,510 55,867 55,867 66,976 66,976

7. SHARES IN CONTROLLED ENTITIES Paradigm Geoscience (North America) Pty Limited - 1 - 1Banlona Pty Ltd - 2 - 1Paradigm Nevada Pty Ltd - 2 - 2Paradigm Mexico Pty Ltd - 2 - 2PGPL Minerals USA Pty Limited - 371,004 - -PGPL Minerals Middle America Pty Limited - 165,424 - -PGPL Minerals South America Pty Limited - 256,190 - -PGPL Diamonds Pty Limited - 2 - -Paradigm Peru SA - - - -Paradigm Minerals Mexico SA de CV - - - -Paradigm Minerals USA Corporation - - - -Paradigm Diamonds Pty limited - - - -

- 792,627 - 6

8. SECURITY DEPOSITS Cash with government mines department * 12,500 - - -

Electricity deposits 450 450 - -

12,950 450 - -

* These deposits are restricted so that they are available for any rehabilitation that may be required on exploration tenements (refer to Note 19).

9. PLANT AND EQUIPMENT Plant and equipment – at cost 24,719 24,719 12,439 12,439Accumulated depreciation (14,846) (14,846) (11,975) (11,975)Website expenditure – at cost 1,331 1,331 - -Accumulated amortisation (147) (147) - -

11,057 11,057 464 464



Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $

Reconciliation of the carrying amount of plant and equipment at the beginning and end of the current and previous financial year Carrying amount at beginning 464 464 742 742Additions 13,611 13,611 - -Disposals - - - -Depreciation expense (3,018) (3,018) (278) (278)

11,057 11,057 464 464 10. DEFERRED EXPLORATION COSTS AND EXPENDITURE Costs brought forward - - - -Costs incurred during the period 737,747 18,871 - -Costs reallocated out of retained earnings 716,649 - - -Expenditure written off during period (120,734) (18,871) - -

Costs carried forward 1,333,662 - - -Exploration expenditure costs carried forward are

made up of: Expenditure on non joint venture areas 1,333,662 - - -

Costs carried forward 1,333,662 - - -

The above amounts represent costs of areas of interest carried forward as an asset in accordance with the accounting policy set out in Note 1. The ultimate recoupment of deferred exploration expenditure in respect of an area of interest carried forward is dependent upon the discovery of commercially viable reserves and the successful development and exploitation of the respective areas or alternatively sale of the underlying areas of interest for at least their carrying value. Amortisation, in respect of the relevant area of interest, is not charged until a mining operation has commenced.

11. LOANS TO CONTROLLED ENTITIES Unsecured loans to controlled entities (interest free) - 933,305 - 2,096

Loans represent exploration expenditure incurred by subsidiary companies.

12. CURRENT LIABILITIES – PAYABLES Trade creditors 104,721 104,721 82,762 82,762Shareholder funds held on deposit - - 71,314 71,314

104,721 104,721 154,076 154,076



Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $13. CONTRIBUTED EQUITY Share capital

31,430,000 Ordinary shares 4,929,338 4,929,338 907,782 907,782

23,572,500 options, exercise price $0.25, expiry date of 31 August 2012

235,725 235,725 - -

5,165,063 5,165,063 907,782 907,782

Movements in ordinary share capital Date Number of

shares Issue price $

1 July 2006 to 30 June 2007

Balance as at 30 June 2006 01-07-06 233,917 623,105Shares issued to existing shareholders 31-08-06 71,592 $1.00 71,592Shares issued to directors in lieu of fees and expenses 31-08-06 68,319 $1.00 68,319Part payment (20c) on shares issued on 1 for 1 basis 28-11-06 74,766Shares issued to retain Intellectual Property agreement 09-05-07 40,000 $1.00 40,000Shares issued to retain the services of Lydail Pty Ltd 09-05-07 30,000 $1.00 30,000

Balance as at 30 June 2007 30-06-07 443,828 907,782

1 July 2007 to 30 June 2008

Balance b/fwd 443,828 907,782

Complete payment (80c) issued on 1 for 1 basis 03-08-07 373,828 $1.00 299,057

Shares issued to acquire overseas entities 16-08-07 331,142 792,618

Share split 22-08-07 8,781,202

Seed capital 10-09-07 5,000,000 $0.10 500,000

IPO – 16,500,000 shares issued at $0.20 28-11-07 16,500,000 $0.20 3,300,000

Cost of the IPO issue (870,119)

Balance as at 30 June 2008 31,430,000 4,929,338

23,572,500 options, exercise price $0.25, expiry date of 31 August 2012

235,725

Total Issued Capital as at 30 June 2008 5,165,053

Terms and conditions of contributed equity Ordinary Shares Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company, to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company. Option holders have no voting rights until the options are exercised.



Options During the year 23,572,000 options were issued pursuant to the Prospectus dated 29th January 2008. The options were issued for $0.01 and may be exercised on any business day from the date of grant to 31st August 2012. The option may be exercised on the payment of $0.25. Options do not carry any dividend entitlement until they are exercised. Shares issued on exercise of options rank equally with other issued shares seven business days after their date of issue and are entitled to dividends declared on and from that date. Conversion call subscription or issue after 30 June 2008 Since the end of the financial period there have been no other conversion to, call of, or subscriptions for ordinary shares or issues of potential ordinary shares since the reporting date and before the completion of these financial statements. Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $14. RESERVES Balance at the beginning of period - - - -Share-based payments reserve 400,000 400,000 - -

Balance at the end of period 400,000 400,000 - -

15. LOSS PER SHARE Basic loss per share (cents per share) ($0.018) ($0.67)

Diluted loss per share (cents per share) ($0.018) ($0.67)

Weighted average number of ordinary shares on issue used in the calculation of basic and diluted loss per share is Loss used in calculating basic and diluted loss per share

(641,307) (299,764)

16. REMUNERATION BENEFITS

(a) Directors’ remuneration The following table outlines the nature and amount of the elements of the remuneration of specified Directors of the Company for the periods ended 30 June 2007 and 2008.

Salary Directors Fees

Consulting Fees

Superannuation Contributions Options Shares* Total

2007 $ $ $ $ $ $ $ D Austen - 8,000 - - - 10,000 18,000 P Elliott - 8,000 - - - 10,000 18,000 P Nicholson - 8,000 7,500 - - 20,000 35,500 R Reynolds - 8,000 - - - 10,000 18,000 R Soper - 15,000 - - - 15,000 30,000

47,000 7,500 65,000 119,500

* shares issued in lieu of Directors fees



Salary Directors

Fees Consulting

Fees Superannuation Contributions Options Shares Total

2008 $ $ $ $ $ $ $ P Elliott - 18,182 - 1,818 - - 20,000 P Nicholson 4,955 - 115,467 445 80,000 - 200,867 R Reynolds - 18,182 - 1,818 - - 20,000 B Rowe 4,955 - 140,465 445 80,000 - 225,865

9,910 36,364 255,932 4,526 160,000 466,732

Directors’ interests in shares and options in the Company are set out in Note 17.

(b) Executive Officers’ remuneration, shares and options Salary Consulting

Fees Superannuation Contributions Options Shares Total

2008 $ $ $ $ $ $ J Morbey 28,984 23,925 2,735 40,000 95,644

28,984

23,925

2,735

40,000

95,644

Salary Consulting Fees

Superannuation Contributions

Options Shares Total

2007 $ $ $ $ $ $

J Morbey - 4,374 - - - 4,374

- 4,374 - - - 4,374

17. RELATED PARTY DISCLOSURES

The Directors in office during the period were:

Robert Reynolds Patrick Elliott Bernard Rowe Peter Nicholson

On 23rd August 2007 Richard Austen and Ray Soper resigned as directors of the Company prior to the Company seeking election on the Australian Stock exchange. Interests and movements in the shares and options of the Company held by Directors and their Director-related entities as at 30 June 2008: Fully Paid Ordinary Shares As at 30 June 2008 (* share split 8.643817 shares for every one share as at 22nd August 2007)

Directors Balance 1.7.07

Net changes Number*

Balance 30.6.08

Balance held Nominally Number

P Elliott 24,393 1,124,760 1,149,153 1,149,153 P Nicholson 128,567 2,130,509 2,744,140 485,064 R Reynolds 38,968 1,365,420 1,404,388 1,404,388 B Rowe 43,484 894,986 948,470 938,470

At 30 June 2008 235,412 5,515,675 6,246,151 3,977,075 Interests and movements in the shares and options of the Company held by Directors and their Director-related entities as at 30 June 2007:



Fully Paid Ordinary Shares As at 30 June 2007

Directors Balance 1.7.06

Net changes Number

Balance 30.6.07


P Elliott 14,393 10,000 24,393 24,393 P Nicholson 56,832 71,735 128,567 17,748 R Reynolds 19,312 19,656 38,968 38,968 R Soper (22.8.07retired) 10,075 20,038 30,113 30,113 R Austen (22.8.07 retired) 19,188 19,594 38,782 38,782 B Rowe 8,989 34,495 43,484 43,484

At 30 June 2007 128,789 175,518 304,307 193,488

Options at 30 June 2008

Directors Balance 1.7.07 Net changes Number Balance 30.6.08


P Elliott - 861,864 861,864 861,864 P Nicholson - 3,058,103 3,058,103 363,797 R Reynolds - 1,053,290 1,053,290 1,053,290 B Rowe - 1,711,351 1,711,351 703,851

At 30 June 2008 6,684,608 6,684,608 2,982,802

Directors interests in shares and Options includes holdings in their names and in the names of director related entities.

Remuneration options: Granted and vested during the year 2,500,000 options were granted to Directors or officers during the current period under the Company’s Employee Share Option Plan. Shares and options held by Directors included those held by the Directors and their Director-related entities, including the spouses of such Directors and relatives of such Directors. All shares and options, that have been granted were issued or granted on terms no more favourable than to other shareholders or option holders. Services provided by Director-related entities were under normal commercial terms and conditions. No other benefits have been received or are receivable by Directors, other than those already disclosed in the notes to the accounts. 18. FINANCIAL REPORT BY SEGMENT

The Company operates predominantly as a mineral exploration company. The company has assets in the following geographical areas:

Consolidated Consolidated Percentage Percentage 2008 -Assets 2007-Assets 2008 2007

Canada 110,327 - 2.7% -

United States of America 568,902 - 13.92% -

Peru 477,256 - 11.68% -

Mexico 159,616 - 3.9% -

Australia 2,771,424 120,906 67.8% 100% Total assets 4,087,525 120,906 100.0% 100%



The company has liabilities in the following geographical areas:

Consolidated Consolidated Percentage Percentage 2008 -Liabilities 2007-Liabilities 2008 2007

Australia 104,721 154,076 100% 100% Total liabilities 104,721 154,076 100% 100%

The company has earned interest in the following geographical areas:

Consolidated Consolidated Percentage Percentage 2008 2007 2008 2007

Canada 333 - 2.6% -

Australia 125,942 770 97.4% 100% Total interest 126,275 770 100.% 100%

19. CONTINGENT LIABILITIES

The Group has provided guarantees totalling $12,500 in respect of mining tenements. These guarantees in respect of mining tenements are secured against deposits with the relative State Department of Mines. The Company does not expect to incur any material liability in respect of the guarantees.

20. EMPLOYEE ENTITLEMENTS

An employee share option plan has been established where selected employees of the Company can be issued with options over ordinary shares in Global Geoscience Ltd. The options, issued for nil consideration, will be issued in accordance with a performance review by the Directors. The options cannot be transferred and are not quoted on the ASX. The Company has made the following issues this financial year:

Name No. of Options Date Issued Value*

BA Rowe 1,000,000 1 January 2008 $80,000

PM Nicholson 1,000,000 1 January 2008 $80,000

JE Morbey 500,000 1 January 2008 $40,000 * these options have been valued at $0.08 each using the Black & Scholes model of valuation.



21. FINANCIAL INSTRUMENTS

Interest rate risk exposure At balance date, the Company was exposed to a floating weighted average interest rate as follows: Consolidated Parent Consolidated Parent 2008 2008 2007 2007

Weighted average rate of cash balances 8.06% 8.06% 2.39% 2.39%

Cash balances 2,654,338 2,619,736 53,465 53,460

Bank negotiable certificates of deposit are invested between 30 days to 180 days and other cash at bank balances are at call. All other financial assets and liabilities are non-interest bearing.

Net fair value of financial assets and liabilities, on balance sheet and credit risk The net fair value of cash and cash equivalents and non-interest bearing monetary financial assets and financial liabilities of the Company approximates their carrying value. Credit risk is minimal at balance date. 22. COMMITMENTS

Exploration licence expenditure requirements In order to maintain the Company’s tenements in good standing with the various mines departments, the Company will be required to incur exploration expenditure under the terms of each licence. It is the Company’s exploration strategy to farm-out where appropriate to larger companies. Consolidated Parent Consolidated Parent 2008 2008 2007 2007 $ $ $ $Payable not later than one year 314,032 - 94,416 -Payable later than one year but not later than two years 224,000 - - -

538,032 - 94,416 -

It is likely that the granting of new licences and changes in licence areas at renewal or expiry will change the expenditure commitment to the Company from time to time.

23. SUBSEQUENT EVENTS

There have been no material events subsequent to 30 June 2008 apart from the announcement made on 19th September 2008 when the Company announced the signing of an exploration agreement made with Inmet Mining Corporation, a Canadian mining company. The agreement is for the development of the Los Graceros tenement in Mexico.



24. STATEMENT OF CASH FLOWS Reconciliation of net cash outflow from operating activities to operating loss after income tax

(a) Operating (loss) after income tax (641,307) (317,887) (299,764) (298,916) Depreciation 3,018 3,018 278 278 Option based payments 200,000 200,000 - - Goodwill written off 179,101 - - - Directors fees - - 45,000 45,000 Consulting fees - - 70,000 70,000

Change in assets and liabilities: (Increase)/decrease in receivables 11,110 11,110 (4,200) (4,200) (Decrease)/increase in trade creditors 21,959 (49,355) 59,429 59,429

Net cash outflow from operating activities (226,119) (153,114) (129,257) (128,409)

(b) For the purpose of the Statement of Cash Flows, cash includes cash on hand, at bank, deposits and bank bills used as part of the cash management function. The Company does not have any unused credit facilities.

The balance at 30 June 2008 comprised:

Bank operating account 132,023 97,420 53,465 53,460 Bank deposits 2,522,315 2,522,315 - -

Cash on hand 2,654,338 2,619,735 53,465 53,460 25. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES The Company’s principal financial instruments comprise cash and short term deposits. The main purpose of these financial instruments is to finance the company’s operations. The company has various other financial assets and liabilities such as trade receivables and trade payables, which arise directly from its operations. It is, and has been throughout the entire period under review, the company’s policy that no trading in financial instruments shall be undertaken. The main risks arising from the company’s financial instruments are cash flow interest rate risk and equity price risk. Other minor risks are summarised below. The Board reviews and agrees policies for managing each of these risks. Cash flow interest rate risk The Company’s exposure to the risks of changes in market interest rates relates primarily to the company’s short term deposits with a floating interest rate. These financial assets with variable rates expose the company to cash flow interest risk. All other financial assets and liabilities in the form of receivables and payables are non-interest bearing. The Company does not engage in any hedging or derivative transactions to manage interest rate risk. The following tables set out the carrying amount by maturity of the company’s exposure to interest rate risk and the effective weighted average interest rate for each class of these financial instruments. Also included is the effect on profit and equity after tax if interest rates at that date had been 10% higher or lower with all other variables held constant as a sensitivity analysis.



The company has not entered into any hedging activities to cover interest rate risk. In regard to its interest rate risk, the company continuously analyses its exposure. Within this analysis consideration is given to potential renewals of existing positions, alternative investments and the mix of fixed and variable interest rates.

CONSOLIDATED Notes Floating Interest

rate Non-Interest

Bearing Total carrying

amount Interest rate sensitivity - 2008

-10% +10%

2008 2007 2008 2007 2008 2007 profit equity profit equity FINANCIAL A SSETS:

Cash at Bank 5 132,023 53,465 - - 132,023 53,465 (898) (898) 898 898

Short term Deposits 5 2,522,315 - - - 2,522,315 - (17,152) (17,152) 17,152 17,152

Trade & other receivables 55,867 66,977 55,867 66,977

Available for sale investments - - - -

TOTAL 2,654,338 53,465 55,867 66,977 2,710,205 120,442

weighted average Interest rate 20 8.06% 2.39% - - 8.06% 2.39% Financial Liabilities:

Trade and Other payables 12 - - 104,721 154,076 104,721 154,076

TOTAL - - 104,721 154,076 104,721 154,076

weighted average interest rate 20 - - - - - -

Net Financial assets (Liabilities) 2,654,338 53,465 (48,854) (87,099) 2,605,484 (33,634)



PARENT Notes Floating Interest

rate Non-Interest

Bearing Total carrying amount Interest rate sensitivity - 2008

-10% +10%

2008 2007 2008 2007 2008 2007 profit equity profit equity FINANCIAL ASSETS: Cash at Bank 5 97,420 53,460 - - 97,420 53,460 (663) (663) 663 663 Short term Deposits 5 2,522,315 - - - 2,522,315 - (17,152) (17,152) 17,152 17,152 Trade & other receivables 55,866 66,976 55,866 66,976 Available for sale investments - - 1 1 1 1

TOTAL 2,619,735 53,460 55,867 66,977 2,675,601 120,436

weighted average Interest rate 20 8.06% 2.39% - - 8.06% 2.39% Financial Liabilities: Trade and Other payables 12

-

-

104,721

154,076

104,721

154,076

TOTAL

-

- - -

weighted average interest rate 20

-

- - -

- -

Net Financial assets (Liabilities)

2,619,735

53,460

(48,854)

(87,099)

2,570,880

(33,640)

A sensitivity of 10% has been selected as this is considered reasonable given the current level of both short-term and long-term Australian dollar interest rates. A 10% sensitivity would move short term interest rates at 30 June 2008 from around 6.75% to 6.07% representing a 68 points shift. This would represent two or three rate decreases which is reasonably possible in the current environment with the bias coming from the Reserve Bank of Australia and confirmed by market expectations that interest rates in Australia are more likely to move down than up in the coming period. Based on the sensitivity analysis only interest revenue from the variable rate deposits and cash balances is impacted resulting in a decrease or increase in overall income. Price Risk The Company is not currently exposed to equity securities price risk. The Company does have an investment of $1.00 in Crossland Uranium Mines Limited. The shares in Crossland are listed on the Australian Stock exchange. The Directors do not consider the small investment in Crossland a price risk.



Liquidity risk The Company manages liquidity risk by maintaining sufficient cash reserves and marketable securities, and through the continuous monitoring of budgeted and actual cash flows. 2008 2007 $ $ Contracted maturities - year ended 30 June 2008 Receivables: - less than 6 months 50,511 66,977 - 6 to 12 months 5,356 - - 1 to 5 years - - - Later than 5 year - TOTAL 55,867 66,977 Payables: - less than 6 months 104,721 154,076 - 6 to 12 months - - - 1 to 5 years - - - Later than 5 year - - TOTAL 104,721 154,076 Commodity Price Risk The Company is exposed to commodity price risk. This risk arises from its activities directed at exploration and development of mineral commodities. If commodity prices fall, the market for companies exploring for these commodities is affected. The Company does not hedge its exposures. Foreign Exchange Risk Foreign exchange risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the entity’s functional currency. The Company operates a bank account in Canadian Dollars and Peruvian Soles. However the Directors do not consider the foreign exchange risk is material. Net Fair Values For financial assets and liabilities, the net fair value approximates their carrying value. No Financial assets and financial liabilities are readily traded on organised markets in standardised form, other than listed investments. The Company has no financial assets where carrying amount exceeds net fair values at balance date. The Company’s receivables at balance date are detailed in Note 6 and comprise prepaid insurance, amounts owing from the Australian Taxation Office and interest receivable. The credit risk on financial risk on financial assets of the company which have been recognised on the Balance Sheet is generally the carrying amount.



26. PENDING APPLICATION OF ACCOUNTING STANDARDS AFFECTED The following Australian Accounting Standards have been issued or amended and are applicable but are not yet effective. They have not been adopted in preparation of the financial statements at reporting date: AASB Amendment Title Application date of Standard Accounting periods commencing after:

AASB 2007‐3 Amendment to Australian Accounting Standards; and AASB 8 AASB 6, 8 01.01.2009

107, 119, 127

114

Effect : The disclosure requirements of AASB 114: Segment reporting have been replaced due to the issuing of AASB 8: operating Segments in February 2007. These amendments may involve changes to segment reporting disclosures within the Financial Report.

AASB 2007 ‐ Amendments to Australian Accounting Standards: & AASB 123 AASB 101 01.01.2009 107,111, 116 138, 123

Effect : the revised AASB 123: borrowing costs issued in June 2007 has removed the option to expense all borrowing costs. This amendment will require the capitalisation of all borrowing costs directly attributable to the acquisition, construction, or production of a qualifying asset. Presently the Company has no material borrowing costs.

AASB 2007‐8 Amendments to Australian Accounting Standards; & AASB 101 AASB 101 01.01.2009

Effect: The revised AASB 101: Presentation of Financial Statements issued in September 2007 requires the presentation of a Statement of Comprehensive Income. No known or reliably estimable information relevant to assessing the possible impact of these standards on the Company is presently available though it is anticipated that there will be no direct impact on the recognition and measurement criteria of amounts included in the Financial Report.

27. CORPORATE INFORMATION

The financial report of the Group for the year ended 30 June 2008 was authorised for issue in accordance with a resolution of the Directors on twenty second September 2008. Global Geoscience Limited is a company limited by shares and incorporated in Australia. Its shares are publicly traded on the Australian Stock Exchange under the ticker code “GSC”.


In accordance with a resolution of the Directors of Global Geoscience Ltd, I state that:

(1) In the opinion of the Directors:

(a) The financial statements and notes of the Company are in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Company's financial position as at 30 June

2008 and of its performance for the year ended on that date; and (ii) complying with Accounting Standards and the Corporations Regulations 2001;

and (b) there are reasonable grounds to believe that the Company will be able to pay its debts

as and when they become due and payable. (2) This declaration has been made after receiving the declarations required to be made to the

Directors in accordance with section 295A of the Corporations Act 2001 for the financial year ended 30 June 2008.

On behalf of the Board

Robert Reynolds Director Sydney, 22nd September 2008

CORPORATE GOVERNANCE AND SHAREHOLDER INFORMATION


The Board of Directors of Global Geoscience Limited (the Company) is responsible for corporate governance and strives for high standards in this regard. The Board monitors the business and affairs of GSC on behalf of the shareholders by whom they are elected and to whom they are accountable. The Board draws on relevant best practice principles particularly those issued by the ASX Corporate Governance Council in March 2003. At a number of its meetings the Board examined the Company’s corporate governance practices and the progress towards a review of its practice compared to the best practice principles proposed by the ASX Corporate Governance Council. While the Company is attempting to adhere to the principles proposed by ASX, it is mindful that there may be some instances where compliance is not practicable for the Company’s size. The March 2003 Australian Stock Exchange Corporate Governance Council publication “Principles of Good Corporate Governance and Best Practice Recommendations” is for guidance purposes, however all listed companies are required to disclose the extent to which they have followed the recommendations; to identify any recommendations that have not been followed; and reasons for not doing so. The Company’s Board of Directors has reviewed the recommendations. In many cases the Company was already achieving the standard required. In other cases the Company will have to consider new arrangements to enable compliance. In a limited number of instances, the Company may determine not to meet the standard set out in the recommendations, largely due to the recommendation being considered by the Board to be unduly onerous for a company of this size. A set of Revised Principles were issues by ASX in August 2007. The Company has reviewed the Revised Principles and responded to the ASX on its Corporate Governance Policies as part of its listing requirements in December 2007. The following paragraphs set out the Company’s position relative to each of the 10 principles contained in the ASX Corporate Governance Council’s report. Principle 1: Lay solid foundations for management and oversight The Company’s Corporate Governance Policy includes a Board & Governance Charter, which discloses the specific responsibilities of the Board and provides that the Board shall delegate responsibility for the day to day operations and administration of the Company to the Managing Director and other Executive Directors. The Board and Governance Policy is posted on the Company’s website Principle 2: Structure the Board to add value Whilst none of the current Board members are independent directors, the Board is of the view that the Board is structured in such a way as to add value and that the number of directors is appropriate for the size and complexity of the business. Whilst the Chairman is not an independent director, he is not an executive and the Board is of the view that the Chairman is appropriate for the size and complexity of the business. The Company does not currently have a Chief Executive Officer. It has a Managing Director which, for all practical purposes, is the same role as Chief Executive Officer. The Managing Director and the Chairman are different people. It is not Company policy to have a nomination committee given the size and scope of the business. The Board, as a whole, serves to identify, appoint and review Board membership through an informal assessment process, facilitated by the Chairman in consultation with the Company’s external professional advisers.



Principle 3: Promote ethical and responsible decision-making The Company’s Corporate Governance Policy includes a Corporate Code of Conduct, which provides a framework for decisions and actions in relation to ethical conduct in employment. The Corporate Governance Policy is posted on the Company’s website.

The Company’s Corporate Governance Policy includes a Securities Trading Policy. The Corporate Governance Policy is posted on the Company’s website.

Principle 4: Safeguard integrity in financial reporting The Managing Director reviews and approves the financial statements before they are submitted to the Audit Committee and also confirms this in writing to the Board.

The Company has an Audit Committee. The Audit Committee consists of 3 members, 2 of which are non-executive directors and 1 of which is an executive director. None of the members are independent directors. The Chairman of the Audit Committee is a different person than the Chairman of the Board. Whilst not in accordance with the Best Practice Recommendations, the Company is of the view that the experience and professionalism of the persons on the Audit Committee is sufficient to ensure that all significant matters are addressed and actioned. Further, the Board does not consider that the Company is of sufficient size to justify the appointment of additional directors and to do so for the sole purpose of satisfying this requirement would be cost prohibitive and counter-productive. The Company’s Corporate Governance Policy includes a formal charter for the Audit Committee. The audit committee reports to the Board after each committee meeting. In conjunction with the full Board, the committee meets with and reviews the performance of the external auditors (including scope and quality of the audit). Principle 5: Make timely and balanced disclosure The Company has a continuous disclosure program in place designed to ensure the factual presentation of the Company’s financial position. The Continuous Disclosure Policy is posted on the Company’s website. Principle 6: Respect the rights of shareholders The Company’s Corporate Governance Policy includes a shareholder communications policy, which aims to ensure that shareholders are informed of all major developments affecting the Company’s state of affairs. The Board will request the external auditor to attend all future annual general meetings of the Company to answer shareholder questions about the conduct of the audit and the preparation of the auditor’s report. Principle 7: Recognise and manage risk The Company’s Corporate Governance Policy includes a risk management and internal compliance and control policy. The Board oversees an ongoing assessment of the effectiveness of risk management and internal compliance and control. Principle 8: Encourage enhanced performance The Board has developed a formal process for performance evaluation of the Board and the committees. The Corporate Governance Policy is posted on the Company’s website.



Principle 9: Remunerate fairly and responsibly It is not the Company policy to have a remuneration committee given the size and scope of the business. The Board, as a whole, serves to review remuneration and incentive packages, policies and framework through an informal assessment process, facilitated by the Chairman in consultation with the Company’s external professional advisers.

The Company’s constitution provides that the remuneration of non-executive directors will be not more than the aggregate fixed sum determined by a general meeting. The aggregate remuneration has been set at an amount of $200,000 per annum. Currently Mr. Reynolds and Mr. Elliott are paid a set fee of $40,000 each per annum.

Full details of the consultancy agreements entered into with Mr. Rowe and Mr. Nicholson (executive directors) were disclosed at section 13 of the Prospectus, dated 23rd November 2007. In accordance with Corporations Act requirements, the Company discloses the fees or salaries paid to all Directors, plus the five highest paid officers. The Company has an Employee Share Option Plan. Principal 10: Recognise the legitimate interests of stakeholders The Company has established a code of conduct to guide compliance with legal and other obligations to legitimate stakeholders



Information relating to shareholders at 17th September 2008 (per ASX Listing Rule 4.10) Substantial Shareholders Shareholding MR PETER MICHAEL NICHOLSON 2,259,076 7.188 PHILLIAN PTY LIMITED <AUSTEN FAMILY NO 1 A/C> 1,808,098 5.753

Distribution of Shareholders Number of ordinary shares held Number of

Holders Ordinary

Shares

1 – 1,000 0 0 1,001 – 5,000 1 4,005 5,001 – 10,000 135 1,339,750 10,001 – 100,000 232 8,525,195 100,001 – and over 51 21,561,050

419 31,430,000

At the prevailing market price of $0.07 per share, there is one shareholder with less than a marketable parcel of $500.

Top 20 Shareholders of Ordinary Shares as at 17th September 2008

Shares % Shares issued

MR PETER MICHAEL NICHOLSON 2,259,076 7.188 PHILLIAN PTY LIMITED <AUSTEN FAMILY NO 1 A/C> 1,808,098 5.753 BARON NOMINEES PTY LIMITED 1,341,519 4.268 YERONDA NOMINEES PTY LTD <CARRINGTON EQUITY S/FUND A/C> 1,149,153 3.656 ROGO INVESTMENTS PTY LTD <ROGO ACCOUNT> 1,101,957 3.506 CHIFLEY PORTFOLIOS PTY LTD <DAVID HANNON RETIRE A/C> 1,000,000 3.182 MR GRAHAM DONALD CARMAN 950,245 3.023 MOPTI PTY LIMITED <THE ROWE FAMILY A/C> 905,970 2.883 FITEL NOMINEES LIMITED 750,000 2.386 ELINORA INVESTMENTS PTY LTD 530,000 1.686 PACIFIC GOLD RESOURCES LIMITED 500,000 1.591 MS CATHERINE MARY NICHOLSON 485,064 1.543 MR GORDON RUSSELL HART 465,000 1.479 BUDBERTH PTY LTD <IPSEITY S/F A/C> 452,688 1.440 BUDBERTH PTY LTD <IPSEITY S/F A/C> 435,121 1.384 REDCLIFF PTY LTD <SUPERANNUATION FUND A/C> 400,000 1.273 CALAMA HOLDINGS PTY LTD <MAMBAT SUPER FUND A/C> 325,000 1.034 MR JONATHAN ROBERT REYNOLDS 300,000 0.955 MR KEVIN ARTHUR THOMAS & MRS BARBARA THOMAS <THE KBT SUPER FUND A/C> 300,000 0.955 MRS NANCY-LEE THOMAS <THOMAS FAMILY A/C> 300,000 0.955 MR GARRY WILLIAM THOMAS <THOMAS FAMILY A/C> 300,000 0.955 16,058,891 51.094 The following shares and options are restricted by ASX: Ordinary fully paid shares, restricted for 24 months from date of quotation (19/12/2009) 7,429,593



Voting rights There are no restrictions on voting rights. On a show of hands every member present or by proxy shall have one vote and upon a poll each share shall have one vote. Where a member holds shares which are not fully paid, the number of votes to which that member is entitled on a poll in respect of those part paid shares shall be that fraction of one vote which the amount paid up bears to the total issued price thereof. Option holders have no voting rights until the options are exercised.

Audit Committee At the date of the Report of the Directors, the Company has a committee of two Non-Executive Directors and one Executive Director which meets with the Company's external auditors at least once during each half-year. These meetings will take place prior to the finalisation of the half-year financial statements and Annual Report and prior to the signing of the Audit Report.

Statement under ASX Listing Rule 4.10.19 From the date of admission of the Company’s shares on ASX (19th December 2007) to the date of this Annual Report, the Company has used the cash and assets in a form readily convertible to cash that it had at the time of admission in a way consistent with its business objectives. Expenditures have been in line with Prospectus estimates.

GSC Annual Report 2008 - ioneer.com · REVIEW OF OPERATIONS 6 In Peru, Global holds 100% interest...

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