announcement purchase of lignite project

Late announcement:

ASX ANNOUNCEMENT
3 June 2008

Blackham Exercises Option to Purchase
Zanthus Lignite Project in WA

KEY POINTS
• Option Agreement to acquire lignite project in WA.
• JORC In Situ Inferred Resources 164 million tonnes
• Significant potential exists to increase the resource size
• Zanthus seam a feedstock for oil production
• Average seam thickness 10 to 13 meters

Blackham Resources Ltd (Blackham or Company) continues to increase its portfolio of WA lignite projects after exercising an Option Agreement (“Option Agreement”) to purchase Zutshan Energy Pty Ltd (“Zutshan”), owner of the 100% interest in the Zanthus lignite deposit approximately 240 kilometres north east of Esperance in Western Australia’s Eucla Basin.
Blackham has completed all due diligence related to this transaction, including a review of Project tenements and related data and records.

Having exercised the Option Agreement, Blackham now has seven days to complete the acquisition of all issued capital in Zutshan. The consideration for this transaction is:

(a) $100,000 in cash; and
(b) $400,000 worth of fully paid ordinary shares in Blackham on exercise of option.

A further $200,000 worth of fully paid ordinary shares in Blackham will be paid once a decision to mine is made.
The total inferred Lignite Resource at the Zanthus project of 164 million tonnes has an average thickness of 10 to 13 metres and is 15 to 20 metres deep in the south west and up to 50 metres deep in the north east.

Reports by petroleum consultants in 2005 and 2006 highlighted the potential of the Zanthus Seam as a feedstock for oil production. A limited amount of analysis was conducted and sample results ranged from 38 to 133 litres per tonne on a dry basis.

Due the limited sample population and scatter a much lager sample population will be needed before oil content within the Zanthus seam can be evaluated with confidence.

Blackham currently has a combined JORC compliant Resource base of 631 million tonnes taking into account the 70% interest in the Scaddan Energy project and the

100% owned Zanthus deposit.
Project Resource Mt Blackham Share
Mt
Scaddan Energy Project 70% 668 468
Zanthus deposit 100% 164 164
Total Resource 832 632
Potential barrels of oil products** 416 million barrels 316 million barrels

**estimated industry average recovery of 0.5 barrel per tonne of lignite to be confirmed by bench scale testing
Based on a potential 30,000 bbl per day CTL operation Blackham’s current resource could provide feedstock for 30 to 40 years. With additional exploration potential at
Scaddan East and Zanthus, Blackham is well positioned to increase its resources in the region.

As a result of the purchase of the Zanthus lignite deposit Blackham is now strategically positioned to advance the CTL potential of its resources base. The Zanthus project compliments Blackham’s existing interest in the Scaddan Energy project 60 kms north of Esperance, Western Australia. The Zanthus deposit will give Blackham additional flexibility as to the scale and range of products for an operation in the Esperance region.