overview

OVERVIEW
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Like a number of mining explorers, Venus Resources Ltd (ASX:VNS)
started with one objective - to find diamonds - but is now throwing a lot
of its resources into developing its iron ore prospects.
The company has acquired iron ore interests in the heart of the
midwest iron ore province.
Last week the company announced the acquisition of five
exploration licence applications and one prospecting licence application
in the midwest iron ore province immediately on strike from the extensive
tenement holdings of Gindalbie Metals, Royal Resources, Portman Mining
and Midwest Corporation.
Other contiguous tenement holders to the north include Ferrowest
and Aurox.
The tenements cover approximately 25 kilometres of a tightly
folded BIF sequence (the Windanning Formation), which further to the
south hosts the Mungada hematite and Karara magnetite deposits (Gindalbie
Metals) and the Koolanooka/Blue Hills hematite DSO project (Midwest
Corporation).
The six acquired tenement applications cover some 180 square
kilometres of the Yalgoo-Singleton Greenstone Belt which also host the
Golden Grove zinc, copper, gold and silver deposit/s and mines of Oxiana
and the new tenements are also considered prospective for VMS style base
metal mineralisation.
The BIF units contain multiple alternating sequences of iron rich
hematite and magnetite units +/- cherts and intercalated mafic and felsic
units.
Structural thickening is observed adjacent to fold hinges and
complexly folded and dislocated zones.
Hematite enrichment and large increases in potential tonnages is
observed in these geologically complex areas to the south of the Venus
project area where active mining and feasibility studies are currently
being conducted by Gindalbie Metals and Midwest Corporation
Recent exploration success by the Gindalbie/Royal JV (Warriedar
Joint Venture Ground) located 15 kilometres to the south has returned
encouraging drill intersections within hematite rich zones of the BIF
including 60m @ 62.6pc Fe and 19m @ 60.1pc Fe within the same prospective
BIF units.
Previous historic exploration has focused on the base metal and
gold prospectivity of the tenements, however the exploration potential of
the iron mineralisation has been barely touched in the tenement areas.
The tenements are favourably located being adjacent to the
bitumen Golden Grove to Geraldton main road and six kilometres south of
the town of Yalgoo.
An abandoned railway easement runs from Yalgoo to Mullewa where
the current operating railway line from Mullewa to Geraldton is
positioned and comprises a major component of the Oakajee port and rail
project of Yilgarn Infrastructure for the large deposits of Gindalbie and
Midwest Corporation.
Venus has also acquired a 100 per cent interest in application
E66/65, a 121 square kilometre exploration licence located immediately
adjacent to the proposed Oakajee port development.
This tenement may contain rocks suitable as a source of any
construction materials required for the impending development of the
Oakajee port and rail project.
Immediately following grant and statutory approvals Venus plans
to conduct approximately 6,000 metres of drilling to test a number of
targets already identified from field work and magnetic interpretation.
Key terms of the acquisition are:
* Tenements to be acquired: E59/1488, E59/1489, E59/1490,
E59/1503, E59/1504, P59/1887, E66/65;
* The consideration for the acquisition of the tenements
comprises $50,000 cash the issue of two million fully paid Venus
Resources shares at a deemed price of 50c, subject to voluntary escrow
provisions.
* A 1.25pc FOB royalty for iron ore and a 1.25pc net smelter
royalty for base and precious metals.

SHARES PRICE MOVEMENTS
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Shares of Venus Resources yesterday fell 5c to 56c. Rolling high
for the year is 75c and low 30c. The company has 14.8 million shares with
a market cap of $8.3 million.
Directors of Venus Resources say they are pleased with the new
tenement acquisitions and believe that the combination of the diamond
exploration licences adjacent to the Argyle diamond mine, coupled with
the new iron ore tenements, provide Venus with the opportunity for
success on two exploration fronts with active drilling programs due to
commence immediately on receipt of all regulatory approvals.
Meanwhile, Venus Resources considers that the best potential for
finding new diamond pipes in the East Kimberley region of Western
Australia lies in those areas where younger rocks (predominantly
sediments or lava flows) have covered the prospective Proterozoic
basement areas.
This is clearly evident within Exploration Licence E80/3253 which
lies on strike from the Argyle diamond mine.
Important controlling faults and structures believed to be
relevant to the localisation of the Argyle pipe can be mapped extending
along strike to the Venus Resources tenement area.
On the basis of this simple geological principle, exploration
will target areas where Proterozoic-aged kimberlite pipes (similar to
Argyle at approximately 1.2 billion years old) are covered by younger
sediments thus concealing potential diamond pipes from surface discovery.
Venus Resources is exploring for Argyle aged (Proterozoic: 1.2
billion years) lamproite diamond bearing pipes possibly located under
younger cover rocks comprising Devonian sediments or Cambrian basalts(400
million to 600 million years old).
During the quarter Venus significantly expanded its search window
after entering into an agreement to earn an 80 per cent interest in four
tenements located adjacent to its current tenement holding in the East
Kimberley along strike from the Argyle diamond mine.
Under the terms of the agreement signed with unlisted explorers
Raptor Exploration Pty Ltd and UXK Resources Ltd, Venus may earn an 80
per cent interest in any diamond discovery by contributing a minimum of
20 per cent of the total expenditure commitment on the tenements and
completing a bankable feasibility study on any diamond discovery.
The tenements, EL 80/3615, EL 80/3743, EL 80/3761 and application
ELA 80/3880 cover a total area of 503.4 square kilometres and
significantly expand the prospective areas held by Venus Resources in its
search for buried diamond pipes.
Review of the aeromagnetics in the area reveals a number of
structural dilationary targets immediately along strike from the Argyle
diamond mine where possible Proterozoic aged lamproite diamond pipes may
have been intruded and subsequently buried by younger sediments and
volcanic rocks.
Depth of the cover rocks is unknown but is estimated to be in the
order of 50-200 metres in thickness.
Following heritage surveys and mines department approvals the
company plans to conduct drill testing of the targets to test for the
presence of diamond bearing lamproite pipes.
A Heritage Impact Assessment (HIA) has been lodged with the
Kimberley Land Council and a Program of Work (POW) has been lodged with
the Department of Minerals and Resources.
Final approvals are anticipated by the end of June at which stage
drill testing of the targets will commence.

BACKGROUND
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Venus Resources joined the ASX list on June 12, 2007.
It was formed to explore for diamonds in the East Kimberley
region of Western Australia in areas where younger cover rocks have the
potential to hide buried diamond pipes of a similar age and size to the
world-class Argyle diamond mine.
Exploration Licence E80/3253, covering 224 square kilometres,
will be the focus of the company's exploration effort and is located 20
kilometres north of Argyle.
The Argyle mine has to date produced 675 million carats of
diamonds worth a combined $US11 billion ($14.3 billion) in the 21 years
since open pit operations began in 1985.
Since the discovery of Argyle in 1979 subsequent exploration in
the East Kimberley has located a number of smaller dykes and pipes
however, no pipes of Argyle's size and economic significance have been
found.
Venus Resources has recognised that any new commercial lamproite
diamond pipes are possibly located under younger Devonian cover rocks in
the vicinity of Argyle and has acquired what it considers to be a key
ground holding based on this simple principle.
An extensive sequence of Devonian sediments is present throughout
the tenement area and Venus Resources plans to systematically drill key
targets already identified within the project area where outcropping
Devonian rocks may be covering older Proterozoic aged lamproite diamond
pipes.
The targets are conceptual in nature, however the complex geology
linked to an ideal geological setting provides the Company with a real
opportunity to test for and potentially discover a new lamproite diamond
pipe.