Technical Report 3697

Exploration Permit for Minerals No. 14488 ‘Waggaboonyah’, Queensland Partial Relinquishment Report

For the Period Ended 26 July 2008

XSTRATA COPPER EXPLORATION PTY LTD

TECHNICAL REPORT No.

3697

TITLE: EXPLORATION PERMIT FOR MINERALS No. 14488 ‘WAGGABOONYAH’, QUEENSLANDPARTIAL RELINQUISHMENT REPORT FOR THE PERIOD ENDED 26 JULY 2008

HOLDER: MOUNT ISA MINES LIMITED

OPERATOR: XSTRATA COPPER EXPLORATION PTY LTD

1:250,000 SHEET: SF54-1 MOUNT ISA

1:100,000 SHEET: 6757 KENNEDY GAP

INVESTIGATIONSCONDUCTED BY: XSTRATA COPPER EXPLORATION PTY LTD

AUTHOR: RM LILLY

SUBMITTED BY: TG SHAW

DATE: SEPTEMBER 2008

COPY: 2

DISTRIBUTION

1. Xstrata Copper Exploration Pty Ltd, Mount Isa Library

2. Department of Mines and Energy, Brisbane

3. Xstrata Copper Exploration Pty Ltd, Exploration Library

i

LIST OF CONTENTS

1 INTRODUCTION.....................................................................................1

2 LOCATION AND ACCESS.......................................................................1

3 TENURE..........................................................................................1

4 REGIONAL GEOLOGY............................................................................1

5 PREVIOUS EXPLORATION......................................................................2

6 EXPLORATION COMPLETED DURING THE CURRENT TERM....................3

7 CONCLUSIONS................................................................................3

8 REFERENCES...................................................................................4

ii

LIST OF DRAWINGSDrawing No Title Scale62026 EPM 14488 Waggaboonyah 2008 Rock Chip

SampleLocations Within Relinquished Sub-Blocks 1:100,000

62027 EPM 14488 Waggaboonyah Location andRelinquished Sub-blocks 2008 1:250,000

LIST OF APPENDICES

Appendix No TitleAppendix 1 Rock Chip Geochemistry

ii

SUMMARYAim of ProjectThe Waggaboonyah area was selected as prospective for Isa-style and shear-hosted copper mineralisation. Exploration Permit for Minerals (EPM) 14488 ‘Waggaboonyah’ was granted to Mount Isa Mines Limited on 27 July 2005.

Object of ReportTo document the results of exploration on the seven sub-blocks (50% of holding) relinquished from EPM 14488 ‘Waggaboonyah’ in July 2008.

Location‘Waggaboonyah’ EPM 14488 is located approximately 60km north-northwest of Mount Isa. The tenement can be accessed via station tracks leading east from the unsealed McNamara Road, currently being used to access Copper Co’s Lady Annie mine-site.

Tenure‘Waggaboonyah’ EPM 14488 originally comprising 28 sub-blocks, was granted to Mount Isa Mines Limited (MIM) on 27 July 2005. The tenement was reduced to 14 sub-blocks following a 50% reduction in July 2007 and by a further 50% following a reduction of seven sub- blocks in July 2008.

PrecisExploration work undertaken in the current term consisted of a rock chip sampling program comprising 129 samples over the surrendered sub-blocks.

September 1 EPM 14488

1 INTRODUCTIONThis report documents exploration work conducted during the period of tenure on the seven sub-blocks relinquished from Exploration Permit for Minerals (EPM) 14488 in July 2008. Exploration activities were carried out by Xstrata Copper Exploration (Xstrata) in a search for Isa-style and shear-hosted high grade, large tonnage copper deposits.

2 LOCATION AND ACCESSThe ‘Waggaboonyah’ EPM 14488 covers approximately 45km² and is centred approximately 60km north-northwest of Mount Isa, in north-western Queensland. The tenement sits in the southern portion of the Kennedy Gap (6757) 1:100,000 sheet, and is situated within the north-eastern quadrant of the Mount Isa (SF54-1) 1:250,000 sheet.

Access to the tenement is generally good, and is obtained via the McNamara Road (Lady Loretta Road), which trends north from the sealed Barkly Highway approximately 65km north-west of Mount Isa. Topography is generally flat to rolling, with local deeply incised creeks. Access during the wet season is poor.

3 TENURE‘Waggaboonyah’ EPM 14488 was granted to Mount Isa Mines Limited (MIM) on 27 July 2005. It is composed of northern and southern areas and had an initial total of 28 sub- blocks. A 50% reduction to 14 sub-blocks was carried out in the third year of tenure which commenced on 27 July 2007. A listing of the seven retained sub-blocks is shown below.

BIM Block Sub BlocksCLON

Total

232 b, c, g, h, m, r, w

7 Sub-blocks Retained

The seven sub-blocks relinquished from EPM 14488 in July 2008 are displayed in Drawing No. 62027 and listed below.

BIM Block Sub BlocksCLON 159 sCLON

Total

304 b, f, g, l, q, r

7 Sub-blocks Relinquished

4 REGIONAL GEOLOGYThe tenement lies broadly on the Kennedy Structure which represent the northern extension of the Mount Isa Fault. This area hosts sediments of the Gunpowder Creek Formation (lower part of the McNamara Group) underlain by sediments and volcanics of the Haslingden Group including the Myally Sub-Group and members of the Eastern Creek Volcanics. Lithologies of the Gunpowder Creek Formation vary from micaceous siltstones and shales for the Upper Unit to feldspathic sandstones for the

September 2 EPM 14488

Lower Unit. The upper Gunpowder Creek Formation occupies the central portions of both northern and southern parts of the EPM and is regarded as a favourable host for Isa-style copper mineralisation.

The major structural elements in the area are dominated by a north northwest striking syncline which is defined by the upper Gunpowder Creek Formation in the core and both

September 3 EPM 14488

lower Gunpowder Creek Formation and Haslingden Group on the limbs. In addition, northeast-trending cross faults are evident in the area displaying a dextral displacement of the truncated stratigraphic units.

5 PREVIOUS EXPLORATION

The area has a long history of previous modern exploration dating back to the 1960's and the dominant targets were copper, phosphate, lead and zinc. No detailed compilation of the previous work has been completed but a desktop review summary is listed in Table 1.

Historic

EPMCompany CR Activitie

s92211993-

99

Rio Tinto Pty Ltd

27534, 29693,30072, 31432

Open file review, aerial photography,review of

geophysical data, LANDSAT data review, geological reconnaissance, and soil sampling.

97531993-

98

MIM 29644, 30038,30649

Detailed geological mapping, rock chipping and soil sampling.

78121991-

96

BHPMinerals

Ltd

23586, 24368,24538, 25903,26524, 27705,28310

Airborne EM survey, soil sampling and rock chipping, and minor drilling (outside current tenement boundary).

37231984

BHPMinerals

Ltd

13689 Analysis of available aero mag data and follow up ground mag survey.

24061980-

82

Shell Co of Au

849, 9327,10756, 10757,11656

Compilation of historical data, air photo geological interpretation, geological mapping, gossan search, andsoil and rock geochemical sampling.

10581972-

74

Eastern Cu Mines Ltd

5088 Review of previous work, follow up geological ground truthing.

6161969-

72

Eastern Cu Mines Ltd andAnacond

a

3648, 3786,4191

Geological mapping, rock chip sampling, and ironstone classification.

102981994-96

CRAExploratio

n Ltd

28074 Open file review

91911991-

94

BHPMinerals

Ltd

25759 Open file review

73371990-

92

MIM Pty Ltd

24220 Gridding, RAB drilling program, rock and soil geochemical sampling.

24061980-

82

Shell 11656 Open file review, air photo interpretation, geological mapping, geochemical sampling, ironstone sampling, andtrenching.

6161970-

Anaconda

3648 Geological mapping of fault zone, rock chip and soil

September 4 EPM 14488

71 geochemical sampling, auger drilling, and IP geophysical surveying.

6151969-

71

Union Minere

3982 Geological interp of air photos, stream sediment, and rock chip geochemical sampling.

Table 1: Summary of Previous Exploration

Exploration work undertaken by Xstrata included a review of AGSO geology to determine areas of interest, and an open file data review. Data from existing MIM Exploration Pty Ltd Inlier airborne magnetic and radiometric compilations were reprocessed with Geosoft software to generate a first pass suite of images in MapInfo format over a selected section of the project area. This suite comprised images of TMI, RTP, RTP1VD, and Radiometric Potassium, Uranium, Thorium and Total Count.

September 5 EPM 14488

Existing geochemical data were compiled into MapInfo and thematic geochemical maps were created to determine anomalous areas and used to highlight target areas for soil sampling. Air photo interpretation was carried out and a regolith map created to determine suitable areas for soil sampling (Fizzard and Santaguida, 2007).

6 EXPLORATION COMPLETED DURING THE CURRENT TERM

A regional rock chip sampling program involving the collection of 129 samples was completed in the south of the tenement during the reporting period; locations are shown in Drawing No. 62026. Between the collection of the samples and their return from assay five samples (MXA47322, 47376, 47377, 47378 and 47379) were lost. No anomalies were noted in the data, with only three samples returning over 100ppm copper. The rock sample description and geochemical data are provided in Appendix 1.

7 CONCLUSIONSThe seven relinquished sub-blocks occupy the southern margin and a single isolated western block of EPM 14488. Sub-blocks covering features of interest were retained.

September 6 EPM 14488

8 REFERENCESFizzard K, Santaguida F, 2007, EPM 14488 ‘Waggaboonyah’ and EPM 12577 ‘Gordon’ Queensland, Combined Annual Report for the Period ending 26 July 2007, Xstrata Copper Exploration Pty Ltd, Technical Report No 3669.

DRAWINGS

APPENDIX ONERock Chip Geochemical Data

m

3100

00

7760000

7757500

7755000

7752500

7750000

N7762500

s

b

f g

Iq

QQEPM 14488 boundary

EPM 14488 ReIinquished sub-

bIocks 2008 Rock chip sampIe

Iocations

2 0 2 4

Kilometers

Scale: 1:100,000

7742500

7745000

7747500

3125

00

3150

00

3175

00

3200

00

3225

00

3250

00

r

Xstrata Copper ExpIoration Pty. Ltd.

copperEPM 14488 Waggaboonyah 2008 Rock chip sampIe

Iocations within reIinquished sub-bIocks

Region: NW QLD Projection:

AGD 84 Author: R.LiIIy ScaIe:

1:100,000

1:100,000 :6757 Drawn: R.LiIIy Date: 19/9/2008

1:250,000 : SF54- Revision Date: Drawing No: 62026 Fig. No:

00730

000

3100

0

3200

0

3300

0

3400

r

Iq

77 000 mN 7770000 mN

s7760000 mN

7750000 mN

f

b

g

7740000 mN

Mount Isa QLD

Current EPM 14488

boundary ReIinquished

sub-bIocks 2008

QQ5 0 5 10 15

km

77400

77500

77600

3000

0

3100

0

3200

0

3300

0

3400

0

Xstrata Copper ExpIoration Pty. Ltd.

copperEPM 14488 Waggaboonyah Location and reIinquished

sub-bIocks 2008Region: NW QLD Projectio

n:AGD 84 Autho

r:R.LiIIy ScaI

e:1:250,000

1:100,000 :6757 Drawn:

S. leffery/R.LiIIy

Date: 19/9/08

1:250,000 : SF54-01

Revision Date: Drawing No: 62027 Fig. No: