wedgetail mining limited - millennium minerals · clive donner (chairman) terry stark ... resource...

Wedgetail Mining LimitedA N N U A L R E P O R T 2 0 0 6

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Wedgetail Mining LimitedGround Floor,

24 Outram Street

West Perth WA 6005

Telephone: +61 (0)8 9488 8800

Facsimile: +61 (0)8 9481 0288

Email: [email protected]

Web: www.wedtgetail.net.au

ContentsCompany Details ........................................................................................... 1

Chairman’s Report ......................................................................................... 2

Review of Operations ..................................................................................... 4

Directors’ Report ......................................................................................... 10

Corporate Governance Statement ................................................................ 17

Income Statement For The Year Ended 31 December 2006 .......................... 21

Balance Sheet As At 31 December 2006 ..................................................... 22

Statement Of Cash Flows For The Year Ended 31 December 2006 ............... 23

Statement Of Changes in Equity For The Year Ended 31 December 2006 ..... 23

Notes To, And Forming Part Of, The Financial Statements ............................. 24

Directors’ Declaration ................................................................................... 41

Independent Audit Report ............................................................................ 42

Schedule Of Interests In Mining Tenements ................................................... 43

Supplementary Information ........................................................................... 47

Front cover photos (clockwise):

Looking southwest towards Golden Eagle,

Quartz vein outcrop, SAG Mill shell, Diamond drillrig

Wedgetail Mission Statement:

Wedgetail Mining

Limited’s mission

is to maximise

shareholder wealth

by finding and

developing quality

gold reserves in a

profitable and socially

responsible manner,

without compromising

the safe work ethic that

protects and maintains

the health and well-

being of our employees

and the environment.

Location map

DirectorsClive Donner (Chairman)

Terry Stark (Managing Director)

Frank Vanspeybroeck

Geoffrey Lambert

Ross Gillon

Evan Kirby

Richard Procter

Company SecretaryJames Moran

Registered Office and Principal Place of BusinessGround Floor

24 Outram Street

West Perth WA 6005

Telephone: +61 (0)8 9488 8800

Facsimile: +61 (0)8 9481 0288

AuditorRothsay Chartered Accountants

Level 1, 2 Barrack Street

Sydney NSW 2000

BankersWestpac Banking Corporation

Level 16, 109 St Georges Terrace

Perth WA 6000

Share Registry Advanced Share Registry

110 Stirling Highway

Nedlands WA 6009

Telephone: +61 (0)8 9389 8033

Facsimile: +61 (0)8 9389 7871

Australian Stock ExchangeHome Branch: Perth

CodeWTE

Company Details

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Dear Shareholder

I am pleased to present to you the Annual

Report of Wedgetail Mining Limited for the

financial year ended 31 December 2006.

Over the 2006 year many challenges have

confronted the Board and management as

they have progressed development of the

Nullagine Gold Project.

Nullagine Gold ProjectSince the successful completion of the

bankable feasibility study (“BFS”) in April

2006 the resource sector has been subject

to substantial increases in operating costs.

These have been well documented in the

media from time to time and consequently,

the management team has been engaged

extensively over the past months in

reviewing, revising and updating the

economic data on the project. Extensive

analysis was undertaken on the different

approaches to mining, haulage and

treatment of the ore in order to optimise

the net result.

Considerable work has been completed

on the approvals required to establish an

operating project. The completion and sign

off by the various authorities are at different

stages. Such approvals include:

• Clearing Permit

• Works Approval

• Mining Proposal

• Shire Approval

• Water Extraction

• Main Roads Department

• Dangerous Goods Storage

• Power Supply

All flora and fauna surveys required by

the Department of Environment and

Conservation (DEC) have been completed

and formal approval of the Mining Proposal

is expected shortly.

Chairman’s Report

The demand on mining equipment and

the long lead times currently experienced

by the industry in sourcing various items

of equipment was the catalyst for the

Company purchasing the SAG mill, the

old Sons of Gwalia camp from Southern

Cross, CIL tanks from Mt Todd and a

mobile crane. These assets are currently

in storage ready for installation at the

project when appropriate.

In October the Westpac Banking Group

Limited was mandated to assist the

Company in funding the development

of the Nullagine Project. Negotiations

and dialogue has continued with the

bank whilst the review of the economic

model is undertaken.

The Board is expected to make a decision

on the commencement and construction

of the mine in the short term.

ExplorationOur exploration strategy was successful

on a number of fronts during 2006,

through both new discoveries and

improvements in the overall resource

base. Underpinning this strategy has been

increased emphasis on target generation

through reconnaissance exploration, and

to this end the program of soil sampling

delineated eleven new geochemical

anomalies during the year. Seven of

these anomalies are located along the

high-grade Golden Gate trend, and scout

drilling of these resulted in the discovery of

the Condor, Harrier and Falcon prospects.

These prospects were quickly advanced

to the resource definition stage, and as

a result they have contributed to a 60%

increase in the resource base at Golden

Gate. Closer to Nullagine, drilling of a

strong soil anomaly near Golden Eagle

resulted in the delineation of extensive

zones of mineralisation at the Angela

prospect, and there appears to be

excellent potential for the delineation

of a bulk-tonnage resource at Beatons

Creek based on the scale and intensity of

the soil anomaly delineated at this prospect

and the results of preliminary drilling.

Looking forward, 2007 promises to be

a busy year, with soil sampling to continue

across Wedgetail’s large prospective

landholding, and drilling directed at the

large number of high quality targets

generated by this work.

Finally, I sincerely thank you all for your

patience and continued support over the

past year. I also extend my sincere thanks

to my board colleagues, the staff and all

the consultants engaged during 2006 for

their efforts and I trust with this continued

support 2007 will be an even more

promising year.

Clive Donner

Chairman

Signed at Perth this 18th day of April 2007

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INTRODUCTION The Company has progressed

towards becoming a gold producer

at the Nullagine Gold Project, with the

achievement of several milestones

during 2006.

The most significant of these was the

completion of a bankable feasibility study in

April 2006 which showed that the planned

Nullagine Gold Project is both technically

and financially robust and could support the

construction of a nominal 1 million tonnes

per annum CIL processing plant milling 4.5

million tonnes of ore to produce in excess

of 300,000 ounces of gold.

In July 2006, RSG Global, as consultants

to Westpac Banking Corporation

(“Westpac”) completed an audit of the

Project Financial Model which resulted

in the Company mandating Westpac to

provide up to $42 milllion of debt funding

for the project.

At an extra-ordinary general meeting in

August shareholders approved a change

of Company name to Wedgetail Mining

Limited to better reflect the Company’s

focus as well as a 1 for 10 consolidation

of the share capital and a subsequent

placement in late September to raise

$19 million for project capital.

DEVELOPMENTMajor development tasks undertaken

during the year were:

• A new SAG mill was ordered from

Polysius (a division of ThyssenKrupp

Engineering).

• The CIL tanks and other infrastructure

were purchased from the Mt Todd mine

site and the equipment dismantled and

transported to the Nullagine site.

• Other second-hand equipment

purchased included the crushing

plant and a large proportion of the

accommodation village buildings.

• Design of the processing plant was

commenced by Holtfreters Pty Ltd and

had reached 50% completion by year

end. The total capital cost of the project

was estimated to be $43 million.

• Tenders were called for the mining of

ore and waste from the Golden Eagle

and satellite pits as well as the road

haulage of ore from the satellite pits.

The costs for contract mining were

found to be significantly above those

used in the BFS and as a result the

Company had to explore other mining

alternatives to reduce these costs.

It is therefore likely the Company will

become an owner miner.

• A number of applications for the

necessary regulatory project approvals

were submitted to the State Government

and significant progress with the

approval of these was achieved by

the end of the year.

• A preliminary study was made of the

potential to heap leach low grade ore

material which will be won from the

Golden Eagle pit. There is the potential

for a large tonnage of this material to be

generated in the Golden Eagle area and

produce additional ounces of gold.

Review of Operations

EXPLORATION 1 Resource DevelopmentResource definition drilling in 2006

focused on new prospects delineated

along the Golden Gate trend during the

latter half of 2005. As a result of this work,

the mineral resource inventory at Golden

Gate was increased 60% by delineating

new resources at the Falcon, Harrier,

Condor and Crow prospects (Figure 1).

Much of the drilling was shallow, testing

above 40 metres depth, and there is the

potential to expand these resources

because mineralisation remains open

at depth in all cases.

Figure 1:

Outline of the Nullagine Project area

showing the location of the main resources


In total, just over 6,500 metres were drilled

along the Golden Gate trend, and the

scope and results of the various drilling

campaigns are summarised in Table 1.

Table 1: Scope and summary of results of resource definition drilling

Deposit Reverse Circulation Results: Holes with Intercepts

No. Holes Metres >10 gmm* >30 gmm*

Golden Gate (ABC) 7 355 28% 28%

Harrier 34 2,372 35% 6%

Falcon 44 2,538 38% 20%

Condor 12 549 75% 17%

Crow 11 444 45% 18%

Buzzard 6 260 66% –

Total 114 6,518

* Note: gmm is an abbreviation for gram-metres, which is the product of the intercept grade, in g/t Au,

and the width of the intercept (e.g. 30 gmm is equivalent to 10 metres grading 3 g/t Au, or 5 metres

grading 6 g/t Au). A 1 g/t Au lower cut-off grade is used to calculate intercept grade.

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Standout results from the resource definition drilling include intercepts such as 12 metres

grading 6.82 g/t Au at Falcon, 16 metres grading 4.94 g/t Au at Condor, and 11 metres

grading 3.89 g/t Au at Harrier. An Australian Stock Exchange (ASX) announcement

detailing the location of these, and other exciting drill results, was released on the

24th of August 2006.

Following the success of resource definition drilling during 2006, an updated Mineral

Resource inventory for the Nullagine Project (at a 1 g/t Au lower cut-off grade) is

presented in Table 2.

Resource definition drilling in 2007

will continue to focus on new prospects

generated by recent and ongoing

reconnaissance exploration along the

Golden Gate trend and further east in

the Eastern Creek area.


Measured Indicated Inferred Total

Deposit Millions Au Millions Au Millions Au Millions Au

Tonnes (g/t) koz Tonnes (g/t) koz Tonnes (g/t) koz Tonnes (g/t) koz

Golden Eagle 4.74 2.04 311 1.44 1.75 80.8 1.34 1.72 74.2 7.52 1.93 466

Barton 0.71 2.11 48.1 0.46 2.13 31.1 0.20 2.70 17 1.36 2.20 96.2

Beatons Creek* – – – – – – 1.60 2.15 110.6 1.60 2.15 110.6

Golden Gate 0.37 3.76 45.1 0.11 3.59 13.1 0.08 3.17 7.8 0.56 3.64 66

Harrier 0.11 2.19 7.5 0.27 2.66 2.3 0.02 2.24 1 0.15 2.28 10.8

Condor 0.10 2.38 7.6 0.03 2.44 2.6 0.03 2.75 2.3 0.16 2.46 12.5

Falcon 0.10 2.58 8.2 0.03 2.33 2.3 0.03 2.40 2.1 0.16 2.50 12.6

Crow 0.02 2.77 2.3 0.01 2.72 0.2 – – – 0.03 2.76 2.6

All Nations 0.50 2.04 32.6 0.06 1.75 3.5 0.04 2.23 2.6 0.60 2.02 38.7

Shearers 0.21 1.81 11.9 0.22 1.51 10.9 0.09 1.50 4.2 0.52 1.60 27.1

Little Wonder – – – 0.19 1.70 10.2 0.21 1.70 11.2 0.39 1.70 21.4

Otways – – – – – – 0.49 1.40 22.1 0.49 1.40 22.1

Gambols – – – – – – 0.20 1.50 9.6 0.20 1.50 9.6

Total 6.85 2.15 474.2 2.57 1.90 157.1 4.31 1.91 265 13.73 2.03 896.3

* Note: Resource estimates prepared by Hellman & Schofield Pty Ltd using a multiple indicator kriging technique, apart from the

Beatons Creek resource which is based on an estimation by the previous owner.

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Table 2: Mineral Resource Inventory for the Nullagine Project

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2 Reconnaissance Exploration

Surface SamplingMajor programs of soil sampling and

follow-up rock-chip sampling continued

this year, and in tandem these surface

sampling techniques have been very

effective tools for quickly advancing

geological targets through to the drilling

stage. Figure 2 shows the new target

areas evaluated by soil sampling

during 2006.

The soil sampling technique employed by

the Company was developed from rigorous

study of the gold and pathfinder metal

behaviour in the soil horizon above the

known gold mineralisation at Golden Eagle

and Shearers deposits. The technique has

already proven to be far more reliable than

Scout DrillingMuch of the 2006 exploration expenditure

was directed towards first-pass drilling of

a series of strong gold-in-soil anomalies

delineated along the Golden Gate trend

and in the area between Golden Eagle

and the Five Mile Creek. In excess of

45,000 metres of inclined RAB drilling was

undertaken over 16 prospects (Figure 3).

The scope and results of the scout drilling

campaigns are summarised in Table 3.

previous soil sampling surveys undertaken

by other companies, and there is the

potential to re-evaluate some of the older

exploration areas using the new sampling

technique, particularly those areas that

encompass what appear to be compelling

geological targets.


Figure 2:

Target areas evaluated by soil sampling

Figure 3:

Prospects tested by scout drilling

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Stand-out RAB drill hole intercepts

from these prospects include 20 metres

grading 12.9 g/t Au at Harrier, 8 metres

grading 7.21 g/t Au at Condor and 8

metres grading 9.58 g/t Au at Crow

(ASX announcements released on

29th May and 24th August 2006).

The Company intends to continue

exploration using the methods adopted

in late 2005 and during 2006, whereby

scout drilling is directed at selected surface

sampling anomalies within prospective

target areas that are delineated by

structural mapping. This approach will

ensure that maximum benefit is derived

from exploration expenditure, and should

enable the Company to quickly evaluate

the resource potential of its large, highly

prospective landholding.

Results: Rotary Air Blast Holes with Intercepts

Prospect No. Holes Metres >2 gmm* >5 gmm*

Project Area: Golden Gate

Harrier 33 1,349 58% 42%

Falcon 29 1,198 3% 3%

Condor 37 1,667 62% 54%

Crow 59 2,392 37% 17%

Buzzard 49 2,160 31% 18%

Goshawk 41 1,615 27% 8%

Hawk 28 1,120 14% 7%

Kestrel 149 5,945 10% 3%

Kite 26 1,040 31% –

Osprey 64 2,549 8% 3%

Vulture 46 1,084 11% 4%

Golden Gate Sterilisation 50 2,012 – –

Project Area: Golden Eagle

Angela 95 3,433 57% 21%

Golden Eagle South 110 4,333 10% 3%

Cajuput 51 1,850 2% –

South Dromedary 31 1,240 13% –

Golden Eagle Sterilisation 86 3,436 2% 1%

Project Area: Five Mile

Molly 109 4,393 3% –

Kuwait 42 2,188 19% 7%

1,135 45,724

* Note: A 0.5 g/t Au lower cut-off grade is used to calculate the gram-metre values of scout drill hole intercepts.


Table 3: Scope and Summary of Results of Scout Drilling

The information in this report that relates to

Exploration Results is based on information

compiled by Dr Michael Grigson, who is a

Member of the Australasian Institute of Mining

and Metallurgy. Dr Grigson is a full time employee

of Wedgetail Mining Limited. Dr. Grigson has

sufficient experience which is relevant to the style

of mineralisation and type of deposit under

consideration and to the activity which he is

undertaking to be qualified as a Competent

Person as defined by the 2004 Edition of the

‘Australasian Code for Reporting of Exploration

Results, Mineral Resources and Ore Reserves’.

Dr Grigson consents to the inclusion in the report

of the matters based on his information in the

form and context in which it appears.

Terry Stark

Managing Director

Signed at Perth this 18th day of April 2007

WEDGETAIL MINING LIMITED ANNUAL REPORT 2006

ABN 85 003 257 556

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Wedgetail Mining LimitedF I N A N C I A L R E P O R T

For the year ended 31 December 2006

and shareholders information


10

DIRECTORS

The names and details of the Directors of the Company

in office during or since the end of the financial year are:

Clive Donner (Non-Executive Chairman)

Clive Donner has substantial skills in fundraising

and project financing spanning over 26 years. He

was previously the project finance head and Director

responsible for Rothschild Australia’s project finance

mining business in Western Australia before spending

over a decade in venture capital and equities in the

resources sector. Mr Donner is the Managing Director

of LinQ Resources Fund, a mining and resources fund

specialising in small cap resources.

Mr Donner was appointed non-executive Chairman

of the Company on 5 September 2003.

Frank Vanspeybroeck (Non-Executive Director)

Frank Vanspeybroeck is the founder of Wedgetail.

He has over 23 years experience in the exploration

and mining industry in Australia. His experience includes

gold mining, commissioning and operating carbon in pulp

gold processing plants. He is also the Managing Director

of the AIM listed China Goldmines plc.

Mr Vanspeybroeck was Managing Director of the

Company from 23 November 1999 until 31 January

2006, and remains a non-executive director.

Geoffrey Lambert (Non-Executive Director)

Geoffrey Lambert holds BEc and MEc degrees from the

University of Sydney and has had over thirty years experience

in investment banking. Mr Lambert has served on the Boards

of a number of public companies and is currently a Director

of ICS Global Ltd, Stratatel Ltd and Reward Minerals Ltd.

Mr Lambert was appointed a non-executive director of the

company on 23 November 1999.

Ross Gillon (Non-Executive Director)

Ross Gillon is a solicitor in Perth and has previously

been a director of a number of exploration companies.

Mr Gillon was appointed a non-executive director of

the Company on 16 June 2003.

Directors report

The Directors of

Wedgetail Mining

Limited (“Company”

or “Wedgetail”)

present their report

on the Company

for the financial

year ended 31

December 2006.


11

Evan Kirby (Non-Executive Director)

Evan Kirby holds BSc and PhD degrees from the

University of Newcastle upon Tyne. He is a metallurgist with

over 30 years international experience covering operations

management, technical support, engineering design, and

feasibility study management. His work has covered a wide

range of processes associated with gold, platinum group

metals, base metals and sulphuric acid production.

Since 2002, he has operated his own consulting

business, Metallurgical Management Services Pty Ltd.

Mr Kirby was appointed a non-executive director of the

Company on 23 March 2004.

Richard Procter (Non-Executive Director)

Richard Procter holds BSc (Eng) (University of the

Witwatersrand) and MBA (Cape Town) degrees. He

is a mining engineer with over 30 years international

experience covering corporate, operations, contracting,

consulting and project developments. These positions

have included the leadership and management of base

and precious metal mining concerns (at both executive

and general management levels), development of

bankable feasibility studies and their conversion into

mining operations; responsibility for mining asset

evaluations; undertaking valuations including technical

and operational audits, involvement in mining asset due

diligence and Expert reporting; and providing technical

and strategic planning advice to both mining and

industrial organisations.

Mr Procter was appointed a non-executive director of

the Company on 15 February 2005.

Terry Stark (Managing Director, appointed

23 February 2007)

Terry Stark is a mining engineer with more than 35 years

experience in the gold, nickel, manganese and chromite

industries. He is a former managing director of Horizon

Mining Limited and PMA Limited and brings extensive

operating and project development experience to the

Company.

Mr Stark was appointed managing Director of the

Company on 23 February 2007.

DIRECTORSHIPS OF OTHER LISTED COMPANIES

Directorships of other Australian listed companies held by directors in the three years immediately before the end of the

financial year are as follows:

Name Company

Clive Donner Matrix Metals Limited, Dioro Exploration NL and the LinQ Resources Fund

Geoffrey Lambert ICS Global Limited, Stratatel Limited, Reward Minerals Limited, Riversdale Mines Limited

and QMASTOR Limited

Ross Gillon Red River Resources Limited

Evan Kirby Dwyka Diamonds Limited, Sylvania Resources Limited

Richard Procter Nil

Terry Stark Nil

DIRECTORSHIPS INTERESTS

As at the date of this report, the

interests of the Directors and their

associates in the shares of the

Company are:

Clive DONNER – –

Frank VANSPEYBROECK – 1,281,517

Geoffrey LAMBERT – 283,572

Ross GILLON – 475,001

Evan KIRBY – 32,500

Richard PROCTER 42,500 –

Terry STARK – –

Directors report


12

COMPANY SECRETARY

James Moran (Appointed 27 October 2006)

James Moran is a qualified CPA, Chartered Corporate

Secretary and has a Diploma with The Australian Institute

of Company Directors. He has 25 years resources sector

experience gained both locally and overseas. He has had

extensive exposure to both the corporate and operational

sides of financial and management accounting and general

administration functions.

Stephen Brown (Resigned 27 October 2006)

Stephen Brown is a CPA and Chartered Secretary and

has over 20 years experience in the areas of financial and

management accounting, administration and company

secretarial functions.

PRINCIPAL ACTIVITY

The principal activity of the Company during the year

was exploration for gold in Western Australia. There

was no change in the nature of the Company’s principal

activity during the year.

RESULT

The loss after income tax for the financial year was

$2,209,098 (2005: loss of $3,829,112).

DIVIDENDS

No dividend was paid during the financial year and the

directors do not recommend payment of a dividend.

REVIEW OF OPERATIONS

The prime activity of the Company during the 2006 financial

year was the continued exploration and development of the

Nullagine Gold Project in the Pilbara region northern Western

Australia.

A detailed review of the operations for the year is included

in the Review of Operations section of the Annual Report.

STATE OF AFFAIRS

In the opinion of the Directors, there were no other significant

changes to the state of affairs of the Company that occurred

during the financial year under review not otherwise disclosed

in this report or the financial statements.

SIGNIFICANT EVENTS AFTER THE

BALANCE DATE

No matter or circumstance has arisen since the end of

the financial year that has significantly affected, or may

significantly affect the operations of the Company, the

results of those operations or the state of affairs

of the Company in financial years subsequent to

31 December 2006.

LIKELY DEVELOPMENTS AND EXPECTED

RESULTS OF OPERATIONS

The Company intends to continue the exploration and

development of its existing tenements at the Nullagine

Gold Project.

REMUNERATION REPORT

The Remuneration Report outlines the remuneration

arrangements which were in place during the year,

and remain in place at the date of this report, for the

Directors and executives of the Company.

Remuneration Philosophy

The performance of the Company depends on the quality

of its Directors and executives. To prosper, the Company

must attract, motivate and retain highly skilled Directors

and executives.

To this end, the Company embodies the following

principles in its remuneration framework:

• Retention and motivation of key executives

• Attraction of quality management to the Company, and

• Performance incentives which allow executives to

share the rewards of the success of the Company.

Remuneration Committee

The Company is not of sufficient size to warrant the

formation of a remuneration committee. It is the Board

of Directors responsibility for determining and reviewing

compensation arrangements for the Directors and senior

executives.

The Board assesses the appropriateness of the nature

and amount of remuneration of Directors and senior

executives on a periodic basis by reference to relevant

employment market conditions with the overall objective

of ensuring maximum stakeholder benefit from the

retention of a highly qualified Board and executive team.

Remuneration Structure

The structure of non-executive Director and senior

executive remuneration is separate and distinct.

Objective

The Board seeks to set remuneration at a level which

provides the Company with the ability to attract and retain

Directors and executives of the highest calibre, whilst

incurring a cost which is acceptable to shareholders.

Directors report


13

Structure

Remuneration of non-executive Directors comprises

fees determined having regard to industry practice

and the need to attract appropriately qualified persons.

Fees do not contain any non-monetary elements.

Remuneration of executive Directors and other senior

executives are determined after consideration is given to

normal commercial rates of remuneration for similar levels

of responsibility, industry practices and the need to obtain

appropriately qualified persons to fill the executive positions

necessary for the Company to operate. Remuneration is

not linked to the performance of the Company, but rather

on the ability to attract and retain Directors and senior

executives of the highest calibre within the industry.

The granting of remuneration options is done by the

Board. The Board grants the options by giving consideration

to the seniority of the employee’s position and the need

to retain highly qualified employees and executive team.

The granting of options is in substance a performance

incentive which allows employees to share the rewards

of the success of the Company.

Director’s Remuneration

Details of the remuneration of each Director of Wedgetail,

including their personally-related entities, for the year ended

31 December 2006 are set out as follows:

Mr C Donner 2006 50,000 – – – – 50,000

Mr F Vanspeybroeck 2006 22,000 17,500 – – – 39,500

Mr G Lambert 2006 24,000 – – – – 24,000

Mr R Gillon 2006 24,000 – – – – 24,000

Mr E Kirby 2006 24,000 3,450 – – – 27,450

Mr R Procter 2006 24,000 134,760 – – – 158,760

Mr T Stark (appointed Managing

Director 23 Feb 2007) 2006 – 64,000 – – – 64,000

The Company did not have any other executives (“specified

executive”) with authority for the strategic direction and

management of the Company during the year.

Director Employment Contracts

Frank Vanspeybroeck is a Director of IMMO Services (WA)

Pty Ltd. The Company has entered into a contract with

IMMO Services (WA) Pty Ltd for the supply of management

services under normal commercial terms and conditions.

The agreement terminated on 31 January 2006,

with no termination benefits payable.

Mr Evan Kirby is a Director of Metallurgical

Management Services (Pty) Ltd which provides

metallurgical consultancy services to the Company.

Mr Terry Stark is a Director of T A Stark and Associates

Pty Ltd who received consulting fees up to the end of

the financial year totalling $64,000. Mr Stark was

subsequently appointed Managing Director of the

Company on February 23, 2007.

Directors Consulting Non- Super- Value of

Fees Fees monetary annuation Share

Benefits Options

Year $ $ $ $ $ Total

Directors report


14

Clive DONNER 17 17

Ross GILLON 17 16

Evan KIRBY 17 11

Geoffrey LAMBERT 17 16

Richard PROCTER 17 13

Frank VANSPEYBROECK 17 15

MEETINGS OF DIRECTORS

The number of meetings of Directors

held during the year and the number

of meetings attended by each Director

was as follows:

INSURANCE OF DIRECTORS AND OFFICERS

The Company agreed to pay a premium in respect of a contract insuring the Directors and Officers of the Company.

Full details of the cover and premium are not disclosed as the insurance policy prohibits the disclosure.

Expiry Date Number of Options Exercise Price

11 October 2007 (unlisted) 3,000,000 55 cents

17 April 2007 (unlisted) 16,000 55 cents

CORPORATE GOVERNANCE

In recognising the need for the highest standards of

corporate behaviour and accountability, the Directors

of Wedgetail support and have adhered to the principles

of corporate governance. The Company’s corporate

governance statement is contained within the

Annual Report.

SHARE OPTIONS

Options on Issue

At the date of this report

unissued shares of the company

under option are:

ENVIRONMENTAL REGULATION

AND PERFORMANCE

The Company’s operations are subject to environmental

regulation under the laws of the Commonwealth and of the

State, with specific conditions relating to rehabilitation.

In the case of Approved Notices of Intent to Mine,

bonds are held by the Company’s bank which may be

released to the company when Department of Industry

and Resources is satisfied that conditions imposed on

those licences have been met.

Notices of Intent to Mine incorporate environmental

conditions, including those related to noise, dust,

water run off, rare and endangered flora and fauna,

sites of historical and aboriginal significance as well

as rehabilitation criteria.

The Directors advise that during the year ended

31 December 2006, no claim has been made by any

competent authority that any environmental issues,

condition of licence or notice of intent have been

breached, or any bond forfeited.

Directors report


15

Directors report


16

Non-Audit Services

The Board of Directors has considered the position and

is satisfied that the provision of non-audit services is

compatible with the general standard of independence

for auditors imposed by the Corporations Act 2001.

The Directors are satisfied that the provision of non-

audit services by the auditor, as set out below, did not

compromise the auditor independence requirements

of the Corporations Act 2001 for the following reasons:

Directors report

The following amounts were paid to the auditors:

• all non-audit services have been reviewed by the

Directors to ensure they do not impact the impartiality

and objectivity of the auditor; and

• none of the services undermine the general principles

relating to auditor independence as set out in

Professional Statement F1, including acting in a

management or a decision-making capacity for the

Company or acting as advocate for the Company.

Signed at Perth this 29th day of March 2007

in accordance with a resolution of the Directors.

Terry Stark

Managing Director

Auditors’ Remuneration

Auditing accounts 14,000 15,200

Non-audit Services

Independent report 5,700 2,750

2006 2005 $ $


17

This statement outlines the main corporate governance

practices in place throughout the year, which comply with

the ASX Corporate Governance Council recommendations

unless otherwise stated.

Role of the Board

The Board is responsible for ensuring that the Company

is managed in a manner which protects and enhances

the interests of its shareholders and takes into account

the interests of all stakeholders. To fulfil this role, the

Board is responsible for setting the strategic directions

for the Company, establishing goals for management

and monitoring the achievement of these goals.

Because of the limited size of the Company and its

financial affairs and operations, the use of separate

committees of the Board of Directors is not considered

generally appropriate. All matters that might properly be

dealt with by such committees are currently dealt with

by the full Board of Directors. Decisions of the Board

are, to the extent practicable, unanimous.

Composition of the Board

The names and details of the Directors of the Company

in office at the date of this Statement are set out in the

Directors’ Report.

The composition of the Board is determined using the

following principles:

• Persons nominated as Non-Executive Directors shall

be expected to have skills, experience and expertise

of benefit to the Company and to bring an independent

view to the Board’s deliberations. Persons nominated

as Executive Directors must be of sufficient stature and

security of employment to express independent views

on any matter.

• The Chairperson should ideally be non-executive and

independent and be elected by the Board based on

his/her suitability for the position. The Board believes

that the Chairperson is able and brings quality and

independent judgment to all relevant issues falling

within the scope of the role of a Chairperson and

remains up-to-date with current issues facing the

Company by frequent contact with the Managing

Director and executive of the Company.

• All Non-Executive Directors are expected voluntarily to

review their membership of the Board from time-to-time

taking into account length of service, age, qualifications

and expertise relevant to the Company’s then current

policy and programme, together with the other criteria

considered desirable for composition of a balanced

Board and the overall interests of the Company.

• Under the Company’s Constitution, the minimum

number of Directors is three. At each Annual General

Meeting, one third of the Directors (excluding the

Managing Director) must resign, with Directors

resigning by rotation based on the date of their

appointment. Directors resigning by rotation may

offer themselves for re-election.

The Board has accepted the following definition of an

Independent Director:

“An Independent Director is a Director who is not a

member of management (a Non-Executive Director)

and who:

1. is not a substantial shareholder of the Company or an

officer of, or otherwise associated, directly or indirectly,

with a substantial shareholder of the Company;

2. has not within the last three years been employed in

an executive capacity by the Company or another group

member, or been a Director after ceasing to hold any

such employment;

3. is not a principal of a professional adviser to the

Company or another group member;

4. is not a significant consultant, supplier or customer

of the Company or another group member, or an officer

of or otherwise associated, directly or indirectly, with a

significant consultant, supplier or customer;

5. has no significant contractual relationship with the

Company or another group member other than as

a Director of the Company;

6. has not served on the Board for a period which could,

or could reasonably be perceived to, materially interfere

with the Director’s ability to act in the best interests of

the Company; and

7. is free from any interest and any business or other

relationship which could, or could reasonably be

perceived to, materially interfere with the Director’s

ability to act in the best interests of the Company.”

Corporate Governance Statement


18

Wedgetail considers a significant consultant, supplier or

customer to be material if the total of their annual invoices

amounts to more than 5% of the Company’s total

expenditure in that category.

Consistent with the Corporations Law the Company

considers that the Board should have at least three

Directors and strives to have a majority of Independent

Directors. Currently the Board has seven directors, six are

non-executive and Terry Stark the Managing Director was

appointed on February 23, 2007. Messrs Donner and

Gillon are not considered to be independent as Mr Donner

is an officer of a substantial shareholder and Mr Gillon

is a principal of a professional advisor to the Company.

Messrs Lambert, Vanspeybroeck, Procter and Kirby are

considered to be independent of Wedgetail. The number

of Directors is maintained at a level which optimises the

spread of the workload and efficient decision making.

The composition of the Board is reviewed on an annual

basis to ensure the Board has the appropriate mix of

expertise and experience. Where a vacancy exists, through

whatever cause, or where it is considered that the Board

would benefit from the services of a new Director with

particular skills, the Board determines the selection criteria

for the position based on the skills deemed necessary for the

Board to best carry out its responsibilities and then appoints

the most suitable candidate who must stand for election at

the next general meeting of shareholders.

Performance of Directors

The performance of Directors is assessed through review

by the Board as a whole of director’s attendance at and

involvement in Board meetings, his performance and other

matters identified by the Board or other directors. Due to

the Board’s assessment of the effectiveness of these

processes, the Board has not otherwise formalised

measures of a director’s performance.

The Company has not conducted a performance evaluation

of the members of the Board during the reporting period,

however the Board conducts a review of the performance of

the Company against budgeted targets on an ongoing basis.

Conflict of Interest

In accordance with the Corporations Act 2001 and the

Company’s constitution, Directors must keep the Board

advised, on an ongoing basis, of any interest that could

potentially conflict with those of the Company. Where the

Board believes a significant conflict exists, the Director

concerned does not receive the relevant Board papers

and is not present at the Board meeting whilst the item

is considered. Details of Directors related entity

transactions with the Company are set out in the related

parties note in the financial statements.

Independent Professional Advice and

Access to Company Information

Each Director has the right of access to all relevant

Company information and to the Company’s executives

and, subject to prior consultation with the Chairman, may

seek independent professional advice at the Company’s

expense. A copy of advice received by the Director is

made available to all other members of the Board.

Remuneration

The Board of Directors maintains remuneration policies

which are aimed at attracting and retaining a motivated

workforce and management team. The intention is to

match the outcomes from the remuneration system with

the performance of the Company and ultimately the value

received by our shareholders on a long-term basis.

The Company embodies the following principles in its

remuneration framework:

• retention and motivation of key executives;

• attraction of quality management to the Company; and

• performance incentives which allow executives to

share the rewards of the success of the Company.

Full details of Directors’ and specified executives’

remuneration is set out in the Directors’ Report and in

the Directors’ and Executives’ Disclosures note in the

financial statements.

Due to the limited size of the Company and of its

operations and financial affairs, the use of a separate

remuneration committee is not considered appropriate

for Wedgetail.



1�

Committees

To assist the Board in achieving the highest standards

of Corporate Governance, the Directors will aim in

due course to establish an Audit Committee, and

a Remuneration Committee, both to be constituted

with a majority of non-executive Directors.

Audit Committee:

Wedgetail did not have a separately established audit

committee. However, the duties and responsibilities

typically delegated to such a committee are expressly

included in the board’s responsibilities and therefore

were not in compliance with item 4.2 of the ASX

Corporate Governance Principles. The Board does

not believe any marked efficiencies or enhancements

would be achieved by the creation of a separate

committee. An Audit Committee Charter is currently

being planned.

Remuneration Committee:

Recommendation 9.2 of the ASX Corporate Governance

Principles requires the establishment of a remuneration

committee. During the year, Wedgetail did not have a

separately established remuneration committee. However,

the duties and responsibilities typically delegated to such

a committee are expressly included in the main board’s

responsibilities. The Board does not believe that any

marked efficiencies or enhancements would be achieved

by the creation of a separate committee.

Ethics

It is the policy of Wedgetail that all Directors, managers

and employees are expected to act with the utmost

integrity and objectivity, striving at all times to enhance

the reputation and performance of Wedgetail.

Risk Management

The company has in place a framework to safeguard

company assets and ensure that business risks are

identified and properly managed. The company has

in place a number of risk management controls which

include the following:

• Performance and funding of exploration activities;

• Budget controls;

• Guidelines and limits for the approval of capital

expenditure and investments;

• A comprehensive insurance programme;

• Status of Mining Tenements; and

• Continuous disclosure obligations.

Management is required to provide to the Board regular

reports on all these matters.

The Board receives regular reports about the financial

condition and operating results of the company.

The Chief Executive Officer and Chief Financial Officer

annually provide a formal statement to the Board that in

all material respects and to the best of their knowledge

and belief:

• The Company’s financial reports present a true and

fair view of the Company’s financial condition and

operational results and are in accordance with relevant

accounting standards; and

• The Company’s risk management and internal control

systems are sound, appropriate and operating efficiently

and effectively.

Group Strategic Planning

The company has adopted a formal and dynamic process

of strategic planning. The Board reviews and endorses

strategies designed to ensure the long term successful

outcome for the company.



20

Trading in the Company’s Securities by

Directors and Employees

The Board has adopted a policy in relation to dealings in

the Company’s securities which applies to all directors and

employees. Under the policy, directors are prohibited form

short term or “active” trading in the Company’s securities,

and directors and employees are prohibited form dealing

in the Company’s securities whilst in possession of price

sensitive information. The Chairman or Company Secretary

must be notified of any proposed transaction.

Role of Shareholders

The shareholders of the company play an important role

in corporate governance by virtue of their responsibilities

for voting on the appointment of directors.

The Board ensures that shareholders are kept fully

informed on developments affecting the company through:

• The Annual Report and Wedgetail newsletters are

distributed to shareholders;

• Compliance with Australian Stock Exchange’s

continuous disclosure requirements (and subsequent

shareholder announcements); and

• The annual general meeting and other meetings

called to obtain approval for Board action.



21

Notes To, And Forming Part Of, The Financial Statements For The Year Ended 31 December 2006

2006 2005 $ $ Plant and equipment – reconciliation

Carrying amount at beginning of year 1,608,584 1,354,509

Additions 247,389 483,219

Disposals – (1,869)

Less Depreciation (92,897) (227,275)

Carrying Amount At End Of Year 1,763,076 1,608,584

Motor vehicles – reconciliation

Carrying amount at beginning of year 94,519 101,738

Additions 6,853 12,900


Carrying Amount at End of Year 92,116 94,519

Land and buildings – reconciliation

Carrying amount at beginning of year 1,214,357 432,669

Additions at cost – 781,687

Carrying Amount at End of Year 1,214,357 1,214,356

Leasehold improvements – reconciliation





Capital works in progress – reconciliation

Carrying amount at beginning of year – –

Additions at cost 6,986,858 –

Carrying Amount at End of Year 6,986,858 –

Total Amount at End of Year 10,139,530 3,002,372

10. NON CURRENT ASSETS – OTHER FINANCIAL ASSETS

Available for sale financial assets at fair value – 457,000

Security deposits – 125,772

– 582,772

Market Value Of Shares In Listed Companies – 457,000


21

Income Statement For The Year Ended 31 December 2006

Note 2006 2005 $ $

Revenue from ordinary activities 3 692,146 239,643

Bad Debt written off – (250,000)

Carrying amount of non current assets sold – (1,869)

Depreciation and amortisation (107,937) (268,506)

Employment /consultants (1,234,607) (947,532)

Non cash fair value adjustment – (74,500)

Finance costs (756,438) (1,313,090)

Management and administration expenses (796,793) (1,206,171)

Other expenses from ordinary activities (5,469) (7,087)

Profit/(Loss) from ordinary activities before income

tax expense 4 (2,209,098) (3,829,112)

Income tax expense 5 – –

Net profit/(loss) attributable to the members of

Wedgetail Mining Limited 16 (2,209,098) (3,829,112)

Total Changes In Equity Other Than Those Resulting

From Transactions With Owners As Owners (2,209,098) (3,829,112)

Earnings per share – Basic 23 (0.0012) (0.004)

The accompanying notes form part of the financial statements.


22




Additions 247,389 483,219


























– 582,772



22

Balance Sheet For The Year Ended 31 December 2006

Note 2006 2005 $ $ Current Assets

Cash and cash equivalents 6 11,865,433 4,430,059

Receivables 7 144,357 9,148,851

Total Current Assets 12,009,790 13,578,910

Non-Current Assets

Exploration assets 8 24,078,865 17,268,213

Property plant and equipment 9 10,139,530 3,002,372

Other financial assets 10 – 582,772

Total Non-Current Assets 34,218,395 20,853,357

Total Assets 46,228,185 34,432,267

Current liabilities

Trade & Other Payables 11 3,806,511 3,712,157

Provisions 12 82,034 38,024

Interest Bearing Liabilities 13 369,077 6,655,634

Total Current Liabilities 4,257,622 10,405,815

Non Current Liabilities

Interest Bearing Liabilities 14 340,295 2,602,668

Total Non Current Liabilities 340,295 2,602,668

Total Liabilities 4,597,917 13,008,483

Net Assets 41,630,268 21,423,784

Equity

Contributed equity 15 50,452,239 28,183,910

Accumulated losses 16 (8,821,971) (6,760,126)

Total Equity 41,630,268 21,423,784



23




Additions 247,389 483,219


























– 582,772



23

Statement Of Cash Flows For The Year Ended 31 December 2006

Note 2006 2005 $ $ Cash Flows From Operating Activities

Rental and other income 237,197 130,194

Interest and borrowing costs paid (498,000) (775,336)

Payments to suppliers and employees (1,998,490) (1,924,132)

Interest and distributions received 439,102 107,081

Net Cash Used In Operating Activities 21 (b) (1,820,191) (2,462,193)

Cash Flows From Investing Activities

Payments for plant and equipment (6,990,119) (1,282,593)

Payment for mineral exploration areas (3,990,054) (8,448,085)

Proceeds from sale of investments 450,738 –

Proceeds from sale of plant and equipment 14,000 2,181

Payments for mineral exploration security deposits (115,000) (45,678)

Net Cash Used In Investing Activities (10,630,435) (9,774,175)

Cash Flows From Financing Activities

Drawdown on borrowings – 6,624,862

Proceeds from shares issued 28,695,000 7,524,643

Repayments of borrowings (8,809,000) –

Net Cash Provided By Financing Activities 19,886,000 14,149,505

Net Increase / (Decrease) In Cash Held 7,435,374 1,913,137

Cash Held At The Beginning Of Period 4,430,059 2,516,922

Cash Held At The End Of The Financial Year 21 (a) 11,865,433 4,430,059

Statement Of Changes In Equity For The Year Ended 31 December 2006

Total equity at the beginning of the year 21,423,784 10,888,428

Net loss 16 (2,209,298) (3,829,112)

Equity settled transactions:

Value of share options expensed 16 147,453 412,717

Transactions with equity holders in their capacity as

equity holders:

Contributions of equity, net of transaction costs 15 22,268,329 13,951,751

Total equity at the end of the year 41,630,268 21,423,784

Note 2006 2005 $ $



24

(a) Basis Of Presentation

This is a general purpose financial report of the Company

that has been prepared in accordance with applicable

accounting standards and other mandatory professional

reporting requirements (Urgent Issues Group Consensus

Views) and the Corporations Act 2001. The accounting

policies have been consistently applied.

The financial statements have been prepared on the basis

of historical costs, except where stated certain current and

non-current assets are held at current valuation.

(b) Statement of Compliance

The full year financial report complies with Australian

Accounting Standards, which include Australian

equivalents to International Financial Reporting Standards

(‘AIFRS’). Compliance with AIFRS ensures that the full year

financial report, comprising the financial statements and

notes thereto, complies with International Financial

Reporting Standards (‘IFRS’).

(c) Income Tax

Income tax on the income statement for the periods

presented comprises current and deferred tax. Income tax

is recognised in the income statement except to the extent

that it relates to items recognised directly in equity, in which

case it is recognised in equity.

Current tax is the expected tax payable on the taxable

income for the year, using tax rates enacted or substantially

enacted at the balance sheet date, and any adjustment to

tax payable in respect of previous years.

Deferred tax is provided using the balance sheet liability

method, providing for temporary differences between

the carrying amounts of assets and liabilities for financial

reporting purposes and the amounts used for taxation

purposes.

A deferred tax asset is recognised only to the extent that

it is probable that future taxable profits will be available

against which the asset can be utilised.

(d) Property, Plant and Equipment

Cost and valuation

Items of property, plant and equipment comprising a class

of non current assets are carried at cost less accumulated

depreciation and any impairment in value.

Land and buildings are measured at cost.

The carrying amount of plant and equipment is reviewed

annually by directors to ensure it is not in excess of the

recoverable amount from these assets. The recoverable

amount is assessed on the basis of the expected net cash

flows that will be received from the assets employed and

subsequent disposal. The expected net cash flows have

been discounted to their net present values in determining

recoverable amounts.

Subsequent costs are included in the assets

carrying amount or recognised as a separate asset, as

appropriate, only when it is probable that future economic

benefits associated with the item will flow to the Company

and the cost of the item can be measured reliably. All other

repairs and maintenance are charged to the income

statement during the financial period in which they

are incurred.

Depreciation

Depreciation is calculated on a diminishing value basis to

write off the net cost of each item of plant and equipment

over its expected useful life to the company. The expected

useful lives are as follows:

Plant and equipment 5 – 10 years.

(e) Mineral Exploration Expenditure

Costs incurred during the exploration and evaluation

phases are accumulated in respect of each identifiable

area of interest.

Exploration and evaluation costs shown in the Balance

Sheet represent an accumulation of net direct exploration

and evaluation costs incurred by the company in relation

to the acquisition of areas of interest for which rights of


Wedgetail Mining Limited (“Wedgetail” or the “Company”)

is a public listed limited company that is incorporated and

domiciled in Australia.

During the year, the principal activity of Wedgetail was gold

exploration and development of the Nullagine gold project

in Western Australia.

1. CORPORATE INFORMATION

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


25

tenure are current and expected to be maintained and

in respect of which:

i) such costs are expected to be recouped through

successful development and exploitation of the area;

or

ii) exploration and/or evaluation activities in the areas have

not yet reached a stage which permits an assessment of

the existence or otherwise of economically recoverable

reserves.

The directors regularly review the capitalised exploration

costs and where appropriate areas of interest are written

down to their recoverable amount.

The ultimate recoupment of costs related to the areas

of interest in the exploration and evaluation phase is

dependent on the successful and commercial

exploitation of the relevant areas.

(f) Investments and other financial assets

The Company classifies its investments in the following

categories: financial assets at fair value through profit and

loss, loan and receivables, held-to-maturity investments,

and available-for-sale financial assets. The classification

depends on the purpose for which the investments were

acquired. Management determines the classification of

its investments at initial recognition and re-evaluates this

designation at each reporting date.

(g) Leases

Leases are classified at their inception as either operating

or finance leases based on the economic substance of the

agreement so as to reflect the risks and benefits incidental

to ownership.

Operating leases

The minimum lease payments of operating leases, where

the lessor effectively retains substantially all of the risks and

benefits of ownership of the leased item, are recognised

as an expense on a straight line basis.

Contingent rentals are recognised as an expense in the

financial year in which they are incurred.

Finance leases

Leases which effectively transfer substantially all of the

risks and benefits incidental to ownership of the leased

item to the economic entity are capitalised at the present

value of the minimum lease payments. A lease liability of

equal value is also recognised.

Capitalised lease assets are depreciated over the

estimated useful life of the assets. Minimum lease

payments are allocated between interest expense and

reduction of the lease liability with the interest expense

calculated using the interest rate implicit in the lease

and charged directly to the Income Statement

The cost of improvements to or on leasehold property

is capitalised, disclosed as leasehold improvements,

and amortised over the unexpired period of the lease

or the estimated useful lives of the improvements,

whichever is the shorter.

(h) Segment reporting

A segment is a distinguishable component of the

consolidated entity that is engaged either in providing

products or services (business segment), or in providing

products or services within a particular economic

environment (geographical segment), which is subject

to risks and rewards that are different from those of

other segments.

(i) Goods and Services Tax

Revenue, expenses and assets are recognised net of the

amount of goods and services tax (“GST”), except where

the amount of GST incurred is not recoverable from the

taxation authority. In these circumstances, the GST is

recognised as part of the cost of acquisition of the asset

or as part of the expense.

Receivables and payables are stated with the amount of

GST included. The net amount of GST recoverable from,

or payable to, the ATO is included as a current asset or

liability in the Balance Sheet.

Cash Flows are included in the statement of cash flows

on a gross basis.

The GST components of cash flows arising from investing

and financing activities which are recoverable from, or

payable to, the ATO are classified as operating cash flows.

(j) Trade Payables and Other Creditors

These amounts represent liabilities for goods and services

provided to the company prior to the end of the financial

year and which are unpaid, together with assets ordered

before the end of the financial year. The amounts are

unsecured and are usually paid within 30 days of

recognition.


2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)


26

(k) Trade Receivables and Revenue Recognition

Interest revenue is recognised on a proportional basis

taking into account the interest rates applicable to the

financial assets.

Other debtors are recognised at the amount receivable

and are due for settlement within 30 days from the end

of the month in which services were provided.

(l) Cash and cash equivalents

Cash and cash equivalents include cash on hand and

in banks and investments in money market instruments,

net of any outstanding bank overdraft.

(m) Borrowing Costs

Borrowing costs are recognised as an expense when

incurred.

(n) Interest Bearing Loans and Borrowings

All loans and borrowings are initially recognised at cost.

Any accrued interest is recorded in payables.

(o) Revenues

Revenue is recognised to the extent that it is probable

that the economic benefits will flow to the Company and

the revenue can be reliably measured.

Dividend and distribution revenue is recognised when

the shareholders right to receive payment is established.

Interest revenue is recognised as the interest accrues.

Rental revenue is recognised in accordance with rental

agreements.

(p) Share Based Payment Transactions

Equity based compensation benefits are provided to

certain employees and suppliers as consideration for

goods and services received.

The fair value of options granted is recognised as an

expense. The fair value is measured at grant date and

recognised over the period that the holder becomes

unconditionally entitled to the options.

(q) Employee Entitlements

(i) Wages and Salaries and Annual Leave

Liabilities for wages and salaries, including annual

leave expected to be settled within twelve months of

the reporting date are recognised in the provision for

employee benefits up to the reporting date and are

measured at the amounts expected to be paid when

the liabilities are settled.

(ii) Employee Benefit on-costs

Employee benefit on costs, including payroll tax and

superannuation guarantee charge, are charged as an

expense when incurred.

(r) Comparatives

Where required by Accounting Standards, comparative

figures have been adjusted to conform to changes in

presentation for the current financial year.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)



27




Additions 247,389 483,219


























– 582,772



27


2006 2005 $ $

5. INCOME TAX

Profit / (loss) before income tax expense (2,209,098) (3,829,112)

Prima facie tax on operating profit/(loss) (662,729) (1,148,734)

Tax effect of permanent and timing differences

Non-deductible expenses 50,108 –

Provision for diminution in value of investments – 22,350

Future income tax benefit not brought to account 612,621 1,126,384

Income Tax Expense Attributable To Operating Profit (Loss) – –

The company has approximately $14,139,970 (2005:

$12,097,900) in losses for income tax purposes

unrecouped at balance date (subject to confirmation

by the Commissioner of Taxation). The aggregate future

income tax benefit of $4,241,991 (2005: $3,629,370)

has not been carried forward as an asset in the Balance

Sheet as realisation of the benefit is not regarded as

virtually certain and will only be obtained if:

(a) the company derives future assessable income of

a nature and of an amount sufficient to enable the

benefit from the exploration expenditure and tax

losses to be realised;

(b) the company continues to comply with the conditions

for deductibility imposed by the law; and

(c) no changes in tax legislation adversely affect the

company in realising the benefit from the tax losses.

3. REVENUE FROM ORDINARY ACTIVITIES

Interest received 440,573 97,081

Distributions received 37,249 10,000

Proceeds from disposal of fixed assets – 2,181

Proceeds from sale of financial asset – –

Rental & others 214,324 130,381

692,146 239,643

4. OPERATING PROFIT / (LOSS)

Loss before income tax expense includes the following specific gains

and expenses:

Expenses

Bad debt written off – 250,000

Non cash fair value adjustment – 74,500

Depreciation and amortisation 107,937 268,506

Value of share options expensed 147,453 412,717

Finance costs

Interest paid or payable – other persons 360,397 619,724

Borrowing costs paid – other persons 396,041 693,366

Net Gains

Gain on disposal of shares (11,734) –

Gain on disposal of fixed asset (1,043) 312


28




Additions 247,389 483,219


























– 582,772



28


2006 2005 $ $

9. PLANT AND EQUIPMENT

Plant and Equipment – at cost 2,373,870 2,024,851

Less Accumulated Depreciation (610,794) (416,267)

Written Down Value 1,763,076 1,608,584

MOTOR VEHICLES

Motor Vehicles – at cost 155,936 124,081


Written Down Value 92,116 94,519

LAND AND BUILDINGS

Land and Buildings – at cost 1,214,356 1,214,356

Less Accumulated Depreciation – –

Written down Value 1,214,356 1,214,356

LEASEHOLD IMPROVEMENTS

Leasehold Improvements – at cost 138,145 133,486


Written down Value 83,123 84,913

6. CURRENT ASSETS - CASH

Cash at bank and on hand 1,741,092 192,746

Cash on deposit 10,124,341 4,237,313

11,865,433 4,430,059

7. CURRENT ASSETS - RECEIVABLES

Debtors 27,288 9,085,802

GST refundable 73,381 63,049

Prepayments 43,688 –

144,357 9,148,851

8. EXPLORATION TENEMENTS

Mineral Exploration And Evaluation Expenditure


Current year expenditure 6,810,652 8,448,085


Recoverability of the company’s carrying value of interests in mineral projects

is subject to the successful development and exploitation of the exploration

properties or alternatively, the sale of these tenements at amounts at least equal

to the book values.


2�




Additions 247,389 483,219


























– 582,772



2�


2006 2005 $ $

CAPITAL WORKS IN PROGRESS

Capital Works – Nullagine project 6,989,428 –

Less Accumulated Depreciation – –

Written down Value 6,989,428 –

Total Written Down Value at End of Year 10,142,099 3,002,372

PLANT AND EQUIPMENT - RECONCILIATION


Additions 247,389 483,219




MOTOR VEHICLES - RECONCILIATION





LAND AND BUILDINGS - RECONCILIATION




LEASEHOLD IMPROVEMENTS – RECONCILIATION





CAPITAL WORKS IN PROGRESS – RECONCILIATION





9. PLANT AND EQUIPMENT (continued)


30




Additions 247,389 483,219


























– 582,772



30


2006 2005 $ $ 10. NON CURRENT ASSETS – OTHER FINANCIAL ASSETS



– 582,772


11. CURRENT LIABILITIES – PAYABLES

Trade creditors 3,617,872 3,712,157

Other creditors and accruals 188,639 –

3,806,511 3,712,157

Trade creditors are non interest bearing and are generally on 30 day terms.

12. CURRENT LIABILITIES – PROVISIONS

Provision for employee entitlements 82,034 38,024

The provision consists of annual leave expected to be settled within twelve

months of the reporting date.

13. CURRENT LIABILITIES – INTEREST BEARING LIABILITIES

Convertible note 300,000 2,500,000

Hire Purchase Liability 69,077 90,117

Borrowings – 4,065,517

369,077 6,655,634

On the 25th August 2004, the Company issued a

Convertible Note for $2.5m to Rothschild Australia

Global Resources Fund Ltd, subsequently renamed LinQ

Capital Limited (“LinQ”), as trustee for the LinQ Resources

Fund. Interest is calculated at 10% per annum. The

note originally matured on the 31st May 2006 and in

accordance with the original agreement this was extended

for 12 months. It can be converted into shares in the

company at 35 cents per share. There is a Mining

Mortgage and a fixed and floating charge over the

company’s assets as security for the Convertible Note.

At the shareholders general meeting in August 2006

shareholders approved the deed between LinQ and the

Company whereby LinQ could convert the note into

shares at a conversion price equal to the price (22 cents)

at which shares under the share placement approved in

August were issued. The maximum number of shares to

be issued upon conversion was 10,000,000, resulting

in a partial conversion of the original note.


31




Additions 247,389 483,219


























– 582,772



31


2006 2005 $ $ 14. NON CURRENT LIABILITIES - INTEREST BEARING LIABILITIES

Interest Bearing Liabilities

Hire Purchase Liability 40,295 102,668

Convertible Note 300,000 2,500,000

Total Non Current Interest Bearing Liabilities 340,295 2,602,668

15. CONTRIBUTED EQUITY

(a) Issued Capital

235,852,176 (2005: 1,274,355,298) ordinary shares 50,452,239 28,183,910

(b) Movement In Issued Capital

Balance at the beginning of the financial year 28,183,910 14,232,159

21,392,889 ordinary shares issued 4 cents per share pursuant to share

purchase plan 855,716 –

85,045,886 ordinary shares were issued on 28 September 2006 at 22 cents

per share pursuant to share placement ($18,710,096 less costs of $1,205,017) 17,505,079 –

20,000,000 ordinary shares were issued on 4 October 2006 at 22 cents per

share for the conversion of Convertible Notes. 4,400,000 –

227,272 ordinary shares were issued on 5 December 2006 at 22 cents per

share. This was a rectification following the reconciliation of the share

placement on 28 September 2006 50,000 –

1,003,902 ordinary shares were issued on 5 December 2006 at 24.62 cents

per share for the provision of drilling services in the Nullagine area. 247,161 –

254,221,235 ordinary shares were issued on 31 December 2005 at 5 cents

per share pursuant to the Underwriting Agreements dated December 2005

(Refer Notes 7 and 12).($12,711,062 less costs 2,573,952) 10,137,110

Additional issue costs brought to account (789,627)

On the 3rd March 2005, the company issued a Convertible

Note for $2.5m to LinQ Capital Limited as trustee for the

LinQ Resources Fund. Interest is calculated at 10% per

annum. The note will mature on the 31st January 2007,

however may be extended to no later than 31 January

2008. It can be converted into shares in the company at

5.5 cents per share. There is a Mining Mortgage and a

fixed and floating charge over the company’s assets as

security for the Convertible Note. The LinQ Resources

Fund received interest totalling $396,050 for the convertible

notes and an extension fee of $25,000 was paid for the

extension of the convertible note expiry date.

At the shareholders general meeting in August 2006

shareholders approved the deed between LinQ and the

Company whereby LinQ could convert the note into shares

at a conversion price equal to the price (22 cents) at which

shares under the share placement approved in August

were issued. The maximum number of shares to be issued

upon conversion was 10,000,000, resulting in a partial

conversion of the original note.

2006 2005 $ $


32




Additions 247,389 483,219


























– 582,772



32


(c) Terms and Conditions of Contributed Equity

Ordinary Shares

Ordinary shares have the right to receive dividends as declared and, in the event

of winding up the company, to participate in the proceeds from the sale of all

surplus assets in proportion to the number of and amounts paid up on shares held.

Ordinary shares entitle their holder to one vote, either in person or by proxy, at

a meeting of the company.

15. CONTRIBUTED EQUITY (continued)

3,173,962 ordinary shares were issued on 31 December 2005 from the

exercise of options at an exercise price of 5 cents – 158,698

10,715 ordinary shares were issued on 1 November 2005 from the exercise of

options at an exercise price of 5 cents – 536

77,700,120 ordinary shares were issued on 27 April 2005 at 5 cents per share

for exploration and working capital requirements

($3,885,006 less costs 237,600) – 3,647,406

100,000 ordinary shares were issued on 15 April 2005 from the exercise

of options at an exercise price of 5 cents – 5,000

60,032 ordinary shares were issued on 24 March 2005 from the exercise of

options at an exercise price of 5 cents – 3,001

Balance At The End Of Year 50,452,239 28,183,910

2006 2005 $ $

2006 2005 Number Number (d) Options

Options - listed

Balance at beginning of year – 205,765,862

Issued during year – 51,800,082

Exercised during year – (257,565,944)

Expired during year – –

Balance at end of year – –

Options - unlisted

Balance at beginning of year 34,700,000 –

Issued during year 300,000 34,700,000

Share Capital consolidation (27,270,000) –

Exercised during year – –

Expired during year (4,714,000) –

Balance at end of year 3,016,000 34,700,000


33




Additions 247,389 483,219


























– 582,772



33


(e) Convertible Notes

Movement in notes convertible to ordinary shares in the capital of the parent entity are as follows:

No. of Convertible Conversion Price No. of Potential

Notes Ordinary Shares Balance

$ $ $ $

Opening balance 300,000 0.35 857,142 300,000

Issue of convertible notes 300,000 0.55 545,455 300,000

Closing balance 600,000 1,402,597 600,000

The total number of potential ordinary shares outstanding in the capital of the parent entity at 31 December 2006, in respect

of options and convertible notes, is 4,418,597 (2005: 151,583,116) ordinary shares.

16. ACCUMULATED LOSSES

Opening balance at the beginning of year (6,760,126) (3,343,731)

Net profit/(loss) attributable to members of Wedgetail Mining Limited (2,209,298) (3,829,112)

Equity settled transactions 147,453 412,717

Closing Balance At The End Of Year (8,821,971) (6,760,126)

17. SEGMENTAL INFORMATION

The company operated for the financial year within Australia.

The principal activity of the company was mineral exploration.

2006 2005 $ $

The 30,000,000 unlisted options to subscribe for fully

paid ordinary share which were granted to the Investec

Australia Bank on 3 November 2005 were reduced to

3,000,000 following the 1 for 10 share capital reduction

ratified by shareholders on 29 August 2006. Subsequent

to that shareholders meeting these options now have an

exercise price of 55 cents per share, and expire on

11 October 2007.

On 19 April 2006 Employee Options totalling 160,000

were issued with an exercise price of 4.8 cents. These

expire on 17 April 2007. As a result of the 1 for 10 share

capital consolidation mentioned in the above paragraph

the exercise price is now 48 cents.

15. CONTRIBUTED EQUITY (continued)


34




Additions 247,389 483,219


























– 582,772



34


2006 2005 $ $ 18. EXPENDITURE COMMITMENTS

(a) Exploration

Due to the nature of the company’s activities, it is difficult to accurately

forecast the amount of future expenditure that will be necessary to incur in

order to maintain present interests. Expenditure contracts on mineral tenure

can be reduced by selective relinquishment of exploration tenements, or by

the re-negotiation of expenditure commitments.

The minimum level of exploration commitments:

– Not later than one year is 1,565,000 991,000

– later than one year and not later than five years is 3,000,000 2,887,500

– later than five years is 2,000,000 1,800,000

(b) Operating Lease Commitments

The minimum level of operating lease commitments:

– Not later than one year is 227,952 255,862

– later than one year and not later than five years is 189,960 111,393

c) Finance Lease Commitments

The minimum level of operating lease commitments:

– Not later than one year is 69,077 90,117

– later than one year and not later than five years is – 102,667

19. REMUNERATION OF AUDITOR

Amounts received, or due and receivable by the auditor for:

Auditing 14,000 15,200

Other services 5,700 2,750

19,700 17,950


35




Additions 247,389 483,219


























– 582,772



35


20. RELATED PARTY INFORMATION

(a) Names Of Directors

The persons holding positions as Directors of the Company during the financial year were:

C Donner F Vanspeybroeck

G Lambert R Gillon

E Kirby R Procter

(b) Directors’ Remuneration

Non–Executive Directors

Mr C Donner 2006 50,000 – – – – 50,000

2005 46,500 – – – – 46,500

Mr G Lambert 2006 24,000 – – – – 24,000

2005 24,000 – – – – 24,000

Mr R Gillon 2006 24,000 – – – – 24,000

2005 24,000 – – – – 24,000

Mr E Kirby 2006 24,000 3,450 – – – 27,450

2005 24,000 19,650 – – – 43,650

Mr R Procter 2006 24,000 134,760 – – – 158,760

2005 20,000 – – – – 20,000

Mr F Vanspeybroeck 2006 22,000 17,500 – – – 39,500

2005 – 185,500 – – – 185,500

Post Equity

Short Term Employment Compensation

Directors Consulting Non-monetary Super- Value of Share Total

Fees Fees Benefits annuation Options

Year $ $ $ $ $ $


36




Additions 247,389 483,219


























– 582,772



36


20. RELATED PARTY INFORMATION (continued)

(e) Other Transactions With Specified Directors

Frank Vanspeybroeck is a Director of IMMO Services (WA)

Pty Ltd. The Company has entered into a contract with

IMMO Services (WA) Pty Ltd for the supply of management

services under normal commercial terms and conditions.

During the period that company was paid $17,500 (2005:

$185,500). The agreement terminated on 31 January 2006,

with no termination benefits payable.

Mr Ross Gillon is a partner of Lawton Gillon which

provides legal services to the Company. During the period

that Partnership was paid $48,084 (2005: $29,010).

Mr Evan Kirby is a Director of Metallurgical Management

Services (Pty) Ltd which provides metallurgical consultancy

to the Company. During the period that Company was paid

$3,450 (2005 $19,650).

Mr Clive Donner is a director of LinQ Corporate Pty Ltd,

which is owned by a trust in which Mr Donner is one of

the beneficiaries. During the year this company received

a net fee of $60,000 for corporate and financial advice

provided at normal commercial rates. LinQ Corporate

Pty Ltd also received gross fees at commercial rates of

$777,638 for and on behalf of sub-underwriters to the

share placement in August 2006.

Mr Clive Donner is a director and a beneficiary of

Woodcross Holdings Pty Ltd, the trustee of the

Woodcross Trust, which received $21,744 for the lease

of office furniture to the Company at commercial rates.

Prior to his appointment as Managing Director

Mr Terry Stark was engaged as a consultant to the

Company providing mining engineering services on

the Nullagine Gold Project. Monies paid to him up to

the end of the financial year totalled $64,000.

(c) Executives’ Remuneration

The company does not employ any executive officers apart from the Directors.

(d) Directors’ Interests as at 22 March 2007

Director Ordinary Shares

Direct Interest Indirect Interest

Clive DONNER – –

Frank VANSPEYBROECK – 1,281,517

Geoffrey LAMBERT – 283,572

Ross GILLON – 475,001

Evan KIRBY – 32,500

Richard PROCTER 42,500 –

Terry STARK – –


37




Additions 247,389 483,219


























– 582,772



37


2006 2005 $ $ 21. NOTES TO THE STATEMENT OF CASH FLOWS

(a) Reconciliation Of Cash

Cash as at the end of the financial year as shown in the Statement of

Cash Flows is reconciled to the related items in the Statement of Financial

Position as follows:

Cash at bank 1,741,092 192,746

Cash on deposit 10,124,341 4,237,313

11,865,433 4,430,059

(b) Reconciliation Of Net Cash Provided By Operating Activities

To Operating Loss After Income Tax

Profit/(Loss) after income tax (2,209,298) (3,829,112)

Profit on sale of property, plant and equipment (1,043) (312)

Profit on sale of investments (6,000) –

Depreciation 107,937 273,194

Provision on diminution in financial assets 6,000 74,500

Share based payments 147,453 412,717

Provisions 44,010 38,024

Interest expense capitalised – 65,517

Bad debt written off – 250,000

Exploration written off 10,160 –

Movement in assets and liabilities

Trade receivables (3,432) (67,691)

Tax asset (10,332) 230,128

Trade creditors and accruals 94,354 90,842

Net Cash Used In Operating Activities (1,820,191) (2,462,193)

(c) Non-Cash Investing Activities

There were no non-cash investing activities.


38




Additions 247,389 483,219


























– 582,772



38


The Company’s accounting policies, including the

terms and conditions of each class of financial liability

and equity instrument, both recognised and unrecognised

at the balance date, are as follows:

Short Term Deposits

Short term deposits are stated at the lower of cost and net

realisable value. Interest is recognised in the Statement of

Financial Performance when earned.

22. FINANCIAL INSTRUMENTS

Listed Shares

Listed shares are carried at the lower of cost or

recoverable amount. Dividend income is recognised

when the dividends are declared by the investee.

Trade Payables and Accruals

Liabilities are recognised for amounts to be paid in the

future for goods and services received, whether or not

billed to the Company. Trade liabilities are normally settled

on 60 day terms.

(a) Interest Rate Risk

The Company’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of

changes in market, interest rates and the effective weighted average interest rates on these financial assets, is as follows:

Weighted Average Floating Fixed Maturing Non-Interest

2006 Effective Interest Interest Interest Bearing Total

% $ 1 Year 1 – 5 years $ $

Financial Assets

Interest bearing deposits 6.30% 9,915,251 – – – 9,915,251

Cash at bank 5.80 1,741,092 – – – 1,741,092

Receivables/tax asset – – – – –

Shares in listed companies – – – – –

Security deposits 5.70% 209,090 – – – 209,090

Total Financial Assets 11,865,433 – – – 11,865,433

Financial Liabilities

Payables – – – 3,617,872 3,617,872

Hire Purchase Liability – 69,077 – – 69,077

Provisions – – – – –

Borrowings – – – – –

Convertible notes 10.0% – 300,000 300,000 – 600,000

Total Financial Liabilities – 369,077 300,000 3,617,872 4,286,949

Net Financial Assets 11,865,433 (369,077) (300,000) (3,617,872) 7,578,484


3�


Financial Assets

Interest bearing deposits 5.4% 4,237,313 – – – 4,237,313

Cash at bank 3.7% 192,746 – – – 192,746

Receivables/tax asset – – – 9,148,851 9,148,851

Shares in listed companies – – – 457,000 457,000

Security deposits 5.4% – 125,772 – – 125,772

Total Financial Assets 4,430,059 125,772 – 9,605,851 14,161,682

Financial Liabilities

Payables – – – 3,712,157 3,712,157

Hire Purchase Liability – 90,117 102,668 – 192,785

Provisions – – – 38,024 38,024

Borrowings 8.5% – 4,065,517 – – 4,065,517

Convertible note 10.0% – 2,500,000 2,500,000 – 5,000,000

Total Financial Liabilities – 6,655,634 2,602,668 3,750,181 13,008,483

Net Financial Assets 4,430,059 (6,529,862) (2,602,668) 5,855,670 1,153,199

Weighted Average Floating Fixed Maturing Non-Interest

2005 Effective Interest Interest Interest Bearing Total

% $ 1 Year 1 – 5 years $ $

(b) Credit Risk

The maximum exposure to credit risk, excluding the value

of any collateral or other security, at balance date, to

recognised financial assets is the carrying amount, net

of any provisions for doubtful debts, as disclosed in the

Balance Sheet and notes to the financial statements.

The Company does not have any material risk exposure

to any single debtor or group of debtors, under financial

instruments entered into by it.

(c) Net Fair Values

Methods and assumptions used in determining net

fair value.

For assets and other liabilities, the net fair value

approximates their carrying value. No financial assets

and financial liabilities are readily traded on organised

markets in standardised form, other than listed invest-

ments. The Company has no financial assets where

carrying amount exceeds net fair values at balance date.

The aggregate net fair values and carrying amounts of

financial assets and financial liabilities are disclosed in the

Statement of Financial Position and in the notes to and

forming part of the financial statements.

22. FINANCIAL INSTRUMENTS (continued)


40


2006 2005 Cents per share Cents per share 23. EARNINGS PER SHARE

Basic earnings per share – (loss) (0.0012) (0.004)

Weighted Average number of ordinary shares outstanding during the year

calculation of basic EPS 1,862,814,457 992,002,115

Diluted earnings per share are not considered to be materially different from

basic earnings per share and accordingly are not disclosed.

24. CONTINGENT LIABILITES

Bonds are held with respect to mining licences for which Notices of Intent have been lodged. Bonds are set by the

Department of Minerals and Energy, however there is no certainty that such bonds will be adequate to cover any

environmental damage in the event of mining. The Company is not able to determine the nature or extent of any further

requirement in respect of changing environmental requirements.


41

In accordance with a resolution of the Directors of Wedgetail Mining Limited, I state that:

In the opinion of the Directors:

(a) The statements and notes of the Company are in accordance with the Corporations Act 2001, including:

(i) giving a true and fair view of the Company’s financial position as at 31 December 2006, and performance for the year

ended on that date; and

(ii) complying with Accounting Standards and Corporations Regulations 2001; and

(b) There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become

due and payable.

On behalf of the Board.

Terry Stark

Managing Director

Directors report


42

Independent Audit Report To The Members Of Wedgetail Mining Limited


43

Schedule Of Interests in Mining Tenements

Prospect Area Tenement Registered Holder Wedgetail Beneficial

Interest

ALL NATIONS M46/199 Wedgetail Mining Limited 100%

M46/225 Wedgetail Mining Limited 100%


BARTONS G46/02 *Livestock Marketing Pty Ltd 75%

M46/164 *Livestock Marketing Pty Ltd 75%

M46/3 *Livestock Marketing Pty Ltd 75%

M46/441 TupperGlenda Pty Ltd 75%

BEATONS CREEK M46/10 Wedgetail Mining Limited 100%



BEATONS CREEK EAST P46/1263 Wedgetail Mining Limited 100%

P46/1264 Wedgetail Mining Limited 100%



CAJUPUT P46/1289 Wedgetail Mining Limited 100%




COOKES CREEK E46/591 *Furnace Technology 80%

E46/486 Wedgetail Mining Limited 100%


DAVIS RIVER L46/41 Wedgetail Mining Limited 100%

EASTERN CREEK M46/124 DMF Pty Ltd 100%

M46/142 Young, John William 100%

FEDERATION M46/64 Wedgetail Mining Limited 100%

FIVE MILE P46/1368 Ruane, Michael 100%

M46/50 *Simba Holdings Pty Ltd 75%

E46/308 Tyson Resources Pty Ltd 100%


L46/33 Wedgetail Mining Limited 100%








44



Interest

FIVE MILE P46/1372 Wedgetail Mining Limited 100%





















GOLDEN EAGLE E46/394 Wedgetail Mining Limited 100%

L46/45 Wedgetail Mining Limited 100%




GOLDEN GATE P46/1421 Bighead Enterprises Pty Ltd 100%

P46/1422 Bighead Enterprises Pty Ltd 100%

E46/279 *Simba Holdings Pty Ltd 75%






LITTLE WONDER M46/146 Wedgetail Mining Limited 100%



45


MIDDLE CREEK E46/391 Wedgetail Mining Limited 100%




























MIDDLE CREEK NORTH P46/1478 Wedgetail Mining Limited 100%











Interest


46


MOSQUITO CREEK E46/572 Tyson Resources Pty Ltd 100%

P46/1384 Tyson Resources Pty Ltd 100%










MT MCKAY E46/659 Wedgetail Mining Limited 100%

ONE MILE P46/1309 Wedgetail Mining Limited 100%











TWENTY MILE SANDY P46/1291 Wedgetail Mining Limited 100%







* Net Profit interest.


Interest


47

Category Number of shareholders Units

1-1,000 512 299,729

1,001-5,000 1,910 5,634,204

5,001-10,000 930 7,847,560

10,001-100,000 1,502 47,852,080

100,001-99999999999 181 174,218,603

5,035 235,852,176

Holders holding less than a marketable parcel 1,493 2,152,795

Percentage held by twenty largest holders is 56.63%

SUBSTANTIAL SHAREHOLDINGS

The number of ordinary shares held by the substantial shareholders as at 28 March 2007 were

LinQ Capital Ltd 69,220,078

Supplementary Information

SHAREHOLDERS INFORMATION

DISTRIBUTION OF SHAREHOLDERS AT 28 MARCH 2007


48

Supplementary Information

RBC Dexia Investor Services Australia Nominees Pty Limited 69,220,078 29.35

Westpac Custodian Nominees Limited 17,901,352 7.59

HSBC Custody Nominees (Australia) Limited 11,272,818 4.78

HSBC Custody Nominees (Australia) Limited-GSI ECSA 5,913,500 2.51

Yandal Investments Pty Ltd 5,000,000 2.12

Westpac Direct Equity Investments Pty Ltd 4,883,549 2.07

Geraldton Agricultural Services Pty Ltd 2,500,000 1.06

Citicorp Nominees Pty Limited 2,404,455 1.02

Lando Pty Ltd 2,300,000 0.98

RFC Growth Fund Limited 1,400,000 0.59

J P Morgan Nominees Australia 1,237,559 0.52

ANZ Nominees Limited 1,180,800 0.50

Link Traders (Aust) Pty Ltd 1,136,000 0.48

Mr Paul Neville Griffin 1,100,000 0.47

Vanspeybroeck Superannuation Pty Ltd 1,069,312 0.45

Mr Minlu Fu 1,061,851 0.45

Rod Pearce (The Rod Pearce Family Fund A/C) 1,003,902 0.43

Karari Australia Pty Ltd 1,000,000 0.42

Perpetual Trustee Co Ltd (RFC Growth Fund II A/C) 1,000,000 0.42

Mr Ronald George Martin & Mrs Marie Joyce Martin 1,000,000 0.42

133,585,176 56.63

Category Number of shares % of Issued shares

SHAREHOLDERS INFORMATION

COMPANY DETAILS

i) The name of the Company Secretary is James Moran.

ii) The address of the registered and principal office in

Australia is Ground Floor, 24 Outram Street, West

Perth, WA, AUSTRALIA, 6005.

The telephone number is +61-8-94888800 and the

facsimile number is +61-8-9481 0288.

VOTING RIGHTS

a) On a show of hands each member present in person

or by proxy has one vote.

b) On a poll every member present in person or by proxy

has one vote for each share held in the company.

STOCK EXCHANGES THAT HAVE GRANTED

QUOTATION TO THE COMPANY’S SECURITIES

The company’s securities are quoted on the Australian

Stock Exchange Limited.

UNLISTED OPTIONS ON ISSUE

Options issued by the Company which is not listed on

the Australian Stock Exchange is as follows:

• 3,000,000 options exercisable on or before 11 October

2007 at an exercise price of $0.55 each;

• 16,000 options exercisable on or before 17 April 2007

at an exercise price of $0.48 each; and

• 12,450,000 options exercisable on or before

19 December 2011 at an exercise price of $0.29 each.

TOTAL HOLDING OF THE TWENTY LARGEST HOLDERS OF EACH SECURITY

Top twenty shareholders as at 28 March 2007

ContentsCompany Details ........................................................................................... 1

Chairman’s Report ......................................................................................... 2

Review of Operations ..................................................................................... 4

Directors’ Report ......................................................................................... 10

Corporate Governance Statement ................................................................ 17

Income Statement For The Year Ended 31 December 2006 .......................... 21

Balance Sheet As At 31 December 2006 ..................................................... 22

Statement Of Cash Flows For The Year Ended 31 December 2006 ............... 23

Statement Of Changes in Equity For The Year Ended 31 December 2006 ..... 23

Notes To, And Forming Part Of, The Financial Statements ............................. 24

Directors’ Declaration ................................................................................... 41

Independent Audit Report ............................................................................ 42

Schedule Of Interests In Mining Tenements ................................................... 43

Supplementary Information ........................................................................... 47

Front cover photos (clockwise):

Looking southwest towards Golden Eagle,

Quartz vein outcrop, SAG Mill shell, Diamond drillrig

Wedgetail Mission Statement:

Wedgetail Mining

Limited’s mission

is to maximise

shareholder wealth

by finding and

developing quality

gold reserves in a

profitable and socially

responsible manner,

without compromising

the safe work ethic that

protects and maintains

the health and well-

being of our employees

and the environment.

Location map

Wedgetail Mining LimitedA N N U A L R E P O R T 2 0 0 6

ww

w.d

esig

nban

k.co

m.a

u

Wedgetail Mining LimitedGround Floor,

24 Outram Street

West Perth WA 6005

Telephone: +61 (0)8 9488 8800

Facsimile: +61 (0)8 9481 0288

Email: [email protected]

Web: www.wedtgetail.net.au

wedgetail mining limited - millennium minerals · clive donner (chairman) terry stark ... resource...

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