how much potash do they have

With recent surges in share prices and popularity in the potash sector, namely IPL,MAK,MLX
surely ADY is well positioned to jump on this wave of positive news and popularity. I note from
the JORC report of 27 July 2005 that the inferred potassium chloride resource for the "drilled
area" alone was 2.48mt (USD$372m @ USD$150/t) and total inferred was 4.7mt. The price has
increased some 30% since then.

Please can you let us know if:

1. Is ADY producing/selling potash currently?
2. What plans do you have to get serious potash production happening and when?
3. With the current wave of popularity for potash, is it possible for you to bring this fantastic
resource of ADY to the fore, and promote the fact, to take advantage of this positive market
sector sentiment?

ADMIRALTY RESOURCES NL Answer from Phillip Thomas, Executive Director

The latest JORC shows that over a 30 square kilometre area (of the 250 square km area we
own), we have 50 million tonnes of potash and proven of 33 million tonnes +- 1.9million tonnes.
You quote substantially less numbers.
1. ADY is producing potash as the second last by-product from the lithium process. We have
advised Rheochem Plc, with whom we have the first takeoff contract, we will supply them with
20 tonnes of 99.75% pure potash in May 2008.
2. We have one of the best geological teams in Latin America, if not the America's, with specific
targets of which one is potash. Potash occurs in a solid form as well as in a liquid form (which
we have in brines). For every 17,000 tonne of lithium salts we produce, 77,000 tonne of potash
is produced (basically for free). Two years ago potash was struggling to maintain $175 per
tonne so we did not plan to exceed our production target. Rio Tinto has a $800m project Rio
Colorado down the road with production of 2.4million tonnes per annum, which will basically
satisfy Latin America. Brazil is short 360,000 tonnes of ag grade potash alone. We are producing
at the top end which is used for drilling applications. Ag grade is less pure than what we
produce.
3. Our strategy going forward is to take advantage of the potash price/shortage but and
although our brines are not optimal, the production is free. We also have sodium carbonate and
sodium sulphate from Río Grande mine which is even higher price than potash.