EMAIL ALERTS

The key projects comprising the Chirundu JV are the Njame and Gwabe uranium deposits, located approximately 80km south-east of Lusaka, the capital of Zambia. African Energy Resources has earned an initial 30% equity interest in the project and is earning a 70% equity interest by completing the Chirundu Pre-Feasibility Study for possible development of the Njame and Gwabe deposits.

Albidon Limited 30% operated by African Energy Resources Limited (‘AFR’) under an Exploration Agreement

• Resource modelling on the Njame and Gwabe uranium deposits has confirmed a current resource of >9.5Mlb U3O8 contained within 14 million tonnes of ore.
• Based on these resources, a Pre-feasibility Study (‘PFS’) was completed for the Chirundu Uranium Project by joint venture partner African Energy Resources (‘AFR’). The PFS demonstrates positive economics for uranium mining and processing at Chirundu based on the parameters and assumptions used by AFR.
• Following a review of the results of the PFS for Chirundu, the Company has decided to maintain its 30% interest in the joint venture and commit to funding its share of the Bankable Feasibility Study (‘BFS’) which has now commenced.
• Albidon owns 100% interest in the nearby Kariba and Luano uranium joint ventures in which AFR is earning an initial 30% interest by sole-funding drilling programmes and other exploration activities at a number of mineralised prospects.

Drilling in 2007 has enabled an updated estimate for the Njame deposit.

The total Inferred Resource is now 8.8Mt @ 340 ppm U₃O₈ for 3,000t U₃O₈ (6.6 Mlb). This resource is concentrated in the Njame North deposit, with contributions from the Njame East and Njame Central deposits shown in the table.

Based on drilling completed in 2007 a resource estimate has been completed for the Gwabe project: Inferred Resource of 4.2 Mt @ 267ppm U₃O₈ for 2.5 Mlb of contained U₃O₈ (1,120 tonnes) at a 100ppm lower cut-off grade. The resource estimate methodology and classification complies with the JORC Code and has been independently reviewed by Coffey Mining Pty Ltd.

The Gwabe uranium deposit is located in Karoo-aged sediments and is 20km along strike from the Njame deposit. Uranium mineralization at Gwabe is hosted in oxidised, coarse grained sandstone grits and pebble conglomerates which overlie a nonmineralised, reduced silty-shale horizon.

The mineralisation dips gently to the south-east and is located close to the surface, at between 3m and 29m depth.

The Albidon-African Energy Resources Joint Venture is currently evaluating the potential for economically viable mining and uranium processing at the Njame and Gwabe deposits as part of

the Chirundu Pre-Feasibility Study. With the increased Inferred Resource at Njame, the total Inferred Resource for the Chirundu project is now 4,120t U3O8 (9.1 Mlb U3O8). The Pre-Feasibility Study is expected to be fi nalised by the end of the fi rst quarter of 2008, with a decision to proceed to a full Bankable Feasibility Study (BFS) in the second quarter. The Pre-Feasibility Study is based on mining a number of deposits and trucking uranium-loaded resin from these to a central processing plant.

Exploration continued at the Chisebuka and Namakande uranium prospects in the Kariba Valley JV, in addition to an initial reconnaissance programme covering an extensive area to the southwest of the Munyumbwe and Chisebuka uranium prospects. This area was evaluated through airborne radiometric surveying in November 2007.

Chisebuka Prospect

Rock-chip sampling in 2007 confi rmed the presence of high-grade uranium mineralisation at surface with 11 of 46 samples exceeding 100ppm U3O8. A programme of RC drilling on a nominal 400m x 100m grid was undertaken to test these anomalies. Signifi cant assays are listed in the table below. Mineralisation at Chisebuka occurs in two parallel zones over at least 800m of strike in the northern zone and at least 400m in the southern zone within coarse-grained sandstones interpreted to be part of the Karoo-aged Escarpment Grit Formation that hosts the Njame and Gwabe uranium deposits. Both zones remain open along strike to the northeast. Drilling at Chisebuka is expected to recommence in the second or third quarter of 2008. The Chisebuka uranium prospect is situated 75 km to the south-west of the Njame uranium deposit.

Namakande Prospect

Reconnaissance geological mapping, geochemical sampling, rock-chip sampling and gamma-ray scintillometer surveys were completed over a number of previously identifi ed ground radiometric anomalies at Namakande. Uranium mineralisation has been confi rmed at 5 out of 6 targets, with peak values up to 1,150 ppm U3O8 in rock samples and up to 326 ppm U3O8 in soil samples. Additional soil sampling and geological validation will be undertaken in 2008, with drilling as warranted.

African Energy Resources formally nominated a third joint venture project with Albidon Limited in November 2007. The Luano Valley JV includes parts of two large scale prospecting licenses owned by Albidon containing Karoo sediments located in central Zambia. Exploration will commence in 2008.

Information in this report relating to exploration results and mineral resources is based on data compiled by Frazer Tabeart (an employee and Managing Director of African Energy Resources Limited), who is a member of The Australasian Institute of Mining and Metallurgy. Frazer Tabeart has suffi cient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person under the 2004 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves. Frazer Tabeart consents to the inclusion of the data in the form and context in which it appears.