ERNEST HENRY

Reported that the feasibility study into a potential large scale underground sub-level caving operation at Ernest Henry is expected to be completed in the first half of 2009. In August 2008, the Ernest Henry open pit had a wedge failure in the southern wall. Whilst this did not impact ore production in 2008, as part of the ongoing reassessment of ground conditions, engineering and geotechnical assessments are currently under way to determine the optimal mine plan and schedule.

Reported to have produced 55,739 t of copper in concentrate and 74,024 oz of gold in concentrate. Also reported that the feasibility study into a potential large scale underground sub-level caving operation at Ernest Henry is expected to be finished in the first half of 2009. As part of this study, the underground mining of an access and haulage decline off the main open pit ramp commenced during the first half. Also at Ernest Henry, a feasibility study into the establishment of a magnetite product stream was advanced, with the potential to produce more than 600,000 tonnes of magnetite per annum in the initial stage of production from tailings and low grade stockpiles, ensuring full capacity utilisation at the concentrator in the longer term In 2006, 59,217,847 tonnes of material was mined (10,754,485 tonnes of ore was mined) with head grades of 0.89% and 0.44 g/t for copper and gold, respectively, producing 287,888 tonnes of concentrate.

Copper and gold head grades were 24% lower, in line with the mine plan. The harder ores associated with the lower copper grades resulted in a 6% decrease in ore milled in 2006, partially offset by improved plant runtimes. Material mined at Ernest Henry was 17% lower compared to the prior first half due to significant rainfall events in April and May.