PRINCIPLE 7 – RISK MANAGEMENT

The Board has established a Risk Management Policy designed to ensure that material business risks are identified, assessed, addressed and monitored to help the Company achieve its business objectives.

Material business risks are reviewed at least annually as part of the annual strategic planning, forecasting and budgeting process, and are subject to review on an ongoing basis. Aside from the overriding risks relating to exploration success, the material business risks have been identified as commodity price, financial markets, treasury management, exchange rate fluctuations, political instability/sovereign risk in Mauritania, and general operational risks in the exploration industry.

For the current reporting period, the Company had informal internal compliance and control systems to monitor these material business risks. The finance department completed detailed internal control questionnaires on a sixmonthly basis and these were reviewed by the external auditors as part of the half-yearly reporting to the market. The Company Secretary also oversees a detailed compliance process on an ongoing basis to ensure the Company meets its regulatory obligations.

The Company has begun to formalise and document its system for managing material business risks. This system will include a risk register that identifies, rates, prioritises and delegates the Company’s material business risks. The Company expects to have this documented system finalised and progressively implemented over the forthcoming reporting period.

The categories of risk specifically reported on in the Annual Report are credit risk, liquidity risk, market risk, currency risk and interest rate risk.

The directors of the Company have been given the declarations from the Chief Executive Officer and the Chief Financial Officer required by S295A of the Corporations Act 2001 and have received assurances that these declarations are founded on sound systems of risk management and internal control and that these systems are operating effectively in relation to all material financial risks.

PRINCIPLE 8 – PERFORMANCE AND REMUNERATION

The Board assumes the responsibility of carrying out the functions of the Remuneration Committee at the current time. The Company has adopted a Remuneration Committee Charter establishing how the functions are to be performed in the absence of a separate committee.

Remuneration details are disclosed separately in the Directors’ Report. There is no variable component in the remuneration for executives or for non-executive directors at this time. There are no schemes for retirement benefits other than superannuation in existence.

EXPLANATION OF DEPARTURES FROM ASX BEST PRACTICE RECOMMENDATIONS