quarterly report ending december 31 2006

RE:HEDGING.

At 31 December 2006, the group held forward
sales contracts for the following quantities of
metal:
Copper 14,425 tonnes
Zinc 18,325 tonnes
Gold: 145,887 ounces
Silver 1,224,557 ounces
On a mark-to-market basis, this total hedge
position was out of the money in the amount
of US$151,983,375. With the decline in spot
base metals prices since the end of the
quarter, the out of the money position has
decreased to US$130,336,475 as at close of
business on 30 January 2007.
At 31 December 2006, the group had
outstanding senior and subordinated debt
plus unsecured convertible notes totalling
US$77,828,000 and A$8,000,000
respectively. The group also had standby
credit arrangements in place totalling
US$4,135,000 and undrawn lines of credit
totalling US$16,847,000.