Ann: Quarterly Activities Report , page-2

QUOTE

Corporate

On 8 December 2011, CGNPC Uranium Resources Co., Ltd. ("CGNPC-URC") and the China-Africa Development Fund, announced their intention to make a recommended cash offer for Kalahari Minerals plc, Extract's 42.74% shareholder, through a new acquisition vehicle, Taurus Mineral Limited. The offer is priced at 243.55 pence per Kalahari share. Formal offer documents were posted to Kalahari shareholders on 5 January 2012.

In line with ASIC's ruling governing the potential acquisition by Taurus of an interest of over 20% in Extract, Taurus has proposed to make a downstream cash offer to Extract shareholders if it receives acceptances of the Kalahari Offer in respect of more than 50% of the voting rights in Kalahari. If made, the offer for Extract will be priced at A$8.65 per Extract share.

Extract's Independent Directors are continuing to review all available opportunities to maximise shareholder value, and intend to make a recommendation in relation to the proposed Taurus offer for Extract if and when such an offer is made to Extract shareholders.

Through the ongoing partnership process, the Company has received interest in Husab from a range potential strategic investors. The nature and level of this interest received, including from CGNPC-URC, has confirmed Husab's status as a world class and highly strategic asset. In light of the proposed Taurus offer for Extract, discussions with other interested parties are being accelerated in order to assess whether any alternative and superior proposals may be available for Extract shareholders.

The company intends to continue discussions regarding debt financing of the project and potential offtake arrangements to underpin its development. Plans for delivery of access, power and water infrastructure are also well advanced, while the Mine Optimisation and Resource Extension (MORE) programme continues to deliver results that increase the mine life through definition of further reserves, and that optimise the design of the processing plant and mining operations.

Net cash expenditure in the quarter totalled $9.2m. At 31 December 2011, the Company held cash balances totalling $54.7m.

The Company attended and presented at the following forums during the quarter:

1. Namibia Investment Forum, Windhoek.
2. Commonwealth Business Forum, Perth