agreed, from the prospectusSovereign risk – Tanzania: The...

agreed, from the prospectus

Sovereign risk – Tanzania: The Chilalo Project is located in Tanzania and is subject to the risks
associated with operating in foreign countries. There are risks attached to exploration and
mining operations in a developing country like Tanzania which are not necessarily present
in a developed country like Australia. These risks may include economic, social or political
instability or change, hyperinflation, currency non-convertibility or instability and changes of
(or interpretations of) law affecting foreign ownership, government participation, taxation,
working conditions, rates of exchange, exchange control, exploration licensing, export duties,
repatriation of income or return of capital, environmental protection, labour relations as well
as government control over natural resources or government regulations that require the
employment of local staff or contractors or require other benefits to be provided to local
residents. The Company may also be hindered or prevented from enforcing its rights with
respect to a governmental instrumentality.
There can be no guarantee that the Company will be able to generate a positive return for its
Shareholders if an event occurs in Tanzania which materially adversely affects the value of
the Chilalo Project.
In Tanzania, the State retains ownership of the minerals and consequently retains control
of the exploration and production of mineral resources. Accordingly, these operations may
be materially affected by the government through royalty payments, export taxes and
regulations, surcharges, value added taxes, production bonuses and other charges.