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PT has answered a question.....

Hello Phil,
Thank you for your previous reply.
Announcements out today make it clear that we could see a possible further issue of shares up to another 40m for the balance of $7m loan outstanding. Since discussion of share consolidation at 1 for every 3.4, we have now gone to over 1 for every 4 held...a material change. Is there any other issues that could arise that may see this conversion rate become worse again. It would appear from the price action on the market since the announcement, that these surprises are not appreciated, and being forewarned is a far more comfortable position to be in.
secondly, other than today, we only have 2 more days before end of quarter.Are we still to expect the jorc announcements before 30 June as previously stated. If not, can you give us any idea of how long the delay may be.
Thanking you again for your attention to these matters.

Regards
Rileyi

Hi,

The Company has not received a further request from YA Global Investments for an additional conversion.

I have understanding for the discontent in the market regarding the conversion but it also has a bright side to it. The Company has reduced its debt by 50% in 2 weeks.

Santa Barbara, which is our only cash producing project at the moment, would have to produce 350,000 tonnes of iron ore to be able to pay $13m. As you may realise, 350,000 tonnes is almost the production for 2007-2008.

The projects that Admiralty Resources NL are running are cash hungry projects as they are in an initial expansion stage and pilot stage and if we want to expand as quickly as possible, the convertible note is the way to go.

The dilution will be almost unnoticeable when the ADY shares consolidation takes place prior to the demerger.

SRK Consulting sent a draft of the JORC resources for Mariposa and Mirador about a week ago. I noticed a few geostatical errors and I spent a day with them at the mines on Wednesday. I am reviewing the second draft and will announce to the market as soon as it is ready.

Regards,
PT