AIBC Summit, 20 May 2009, Sydney BHUKIA Gold (-Copper) Deposit, Rajasthan, INDIA Lessons Learnt from 5 Years Exploration of a Remarkable Discovery

AIBC Summit, 20 May 2009, Sydney Start-up Concept Attracted by under-explored gold endowment in India Entry barriers coming down JV partner (NRI) with credentials & ‘connections’ and exciting exploration projects (incl. Bhukia) Sole-focus Newco set up late year drill-out Bhukia List on London-AIM, mark cap expectation A$+60 M

AIBC Summit, 20 May 2009, Sydney Properties Rajasthan main focus –Jagpura Project, Gold (70%) Applications pending elsewhere –Gold, b/metals, diamonds (100%)

AIBC Summit, 20 May 2009, Sydney Outcomes Initial 2-3 year e xploration success; rapid build-up in Gold Resources A$16.1 million private equity (31.36 M shares) JV partner runs into permitting problems; our ‘connections’ not as good as we had expected Irrational and illegal discretionary actions taken by Rajasthan Govt agency After $7 million spent, can’t get next level permits! New Rajasthan Govt. – a ray of HOPE!!??

AIBC Summit, 20 May 2009, Sydney Drilling at Bhukia at Panch Mahuri Zone at Mahi Zone

AIBC Summit, 20 May 2009, Sydney Bhukia Bhukia Ancient Workings Panch Mahuri Delwara

AIBC Summit, 20 May 2009, Sydney Bhukia Bhukia Ancient Workings Timran Mata Largest Ancient Open Pit in drainage gully Person standing at edge of open pit here

AIBC Summit, 20 May 2009, Sydney Bhukia Ancient Workings Mortar stone Pestle Gold Tailings Mound

AIBC Summit, 20 May 2009, Sydney Wealth Creation by Exploration…BUT Gold Resource 1.74 Moz in situ US$1.5 Billion Exploration Target Phase 1 is +5 Moz Doldrums 3-Year Permits Exploration going well Permitting delays Legal doldrums Will there ever be a gold mine?

AIBC Summit, 20 May 2009, Sydney Our Experience ……. Enigmatic Legally granted permits 2-3 years positive exploration, $7 million spent Then Rajasthan Govt. reneges on next level of permits Unprincipled discretionary actions … Unbelievable! Tried reasoning and negotiation Legal challenge ………… new Govt………some hope now

AIBC Summit, 20 May 2009, Sydney India Mining Sector Slowly opening up from mid-1990s 100% FDI …..but……no foreign-run mine yet! Fragmented industry, State-run agencies can veto investment New National Mineral Policy still not legislated A principles-driven policy difficult to achieve – no political consensus Still some underlying resentment to private enterprise and FDI despite policy pronouncements to the contrary?

AIBC Summit, 20 May 2009, Sydney What now for our JV? Need Govt support, not more hurdles! India needs a minerals success story Our JV gold development project could provide choices for future generations ……

AIBC Summit, 20 May 2009, Sydney Lessons Learnt Spend slowly ‘Educate’ bureaucrats and politicians along the way to subdue expectations Don’t assume laws, natural justice, logic and reasonableness will prevail in permitting matters Process-driven business environment, outcomes appear secondary at times!

AIBC Summit, 20 May 2009, Sydney Bureaucracy The system works…….just don’t hold your breath

AIBC Summit, 20 May 2009, Sydney Road Blocks Expect them…….. They are a dead set certainty Organized Chaos……..not to be confused with Disorganized Chaos!

AIBC Summit, 20 May 2009, Sydney Infrastructure………. ………Interrupted! Things are improving...but slowly

AIBC Summit, 20 May 2009, Sydney Have Patience……..….and Perseverance The Brits couldn’t really change India in 200 years So what makes you think you can!?

AIBC Summit, 20 May 2009, Sydney Many Thanks Rajasthan Wonderful land of arid beauty and ancient palaces India Excellent untapped mineral potential But….. Plan B for IGL Continue to assert our legal rights…… …New Business outside of India to spread risk