BRR - Straight from the source

MR. GRAHAM CARMAN, MANAGING DIRECTOR OF PARADIGM METALS LIMITED (PDM)

“Excellence in Mining and Exploration Presentation”

http://www.brr.com.au/event/51325

WEDNESDAY, SEPTEMBER 17, 2008, 3:45 PM.

            PDM    Thanks very much everybody. It’s a pleasure to present Paradigm here to you today. We’ve got a booth upstairs, quite close to the coffee base so feel

10                    free to come and check with us up there when you have time.

                        Usual disclaimer.

                        I want to outline to you today very brief introduction to the company and we’ll

15                    talk about our flagship, Frogmore Copper Project in New South Wales and then, I’ll talk briefly about our tungsten resource here, also in New South Wales, and a very exciting new play we’ve got in joint venture with Exco Resources’ vanadium, molybdenum, uranium project in Cloncurry.

20                    Where are we located? We’ve got a geographic focus in New South Wales, Central Eastern New South Wales, an area which we call our Frogmore Project and the other area is up in the Cloncurry area where we just put out an announcement today, and I’ll talk about that briefly towards the end of the talk. We’re divesting our non-core assets elsewhere in Queensland and in

25                    New South Wales.

                        Who are we? Dick Austen, some of you may know, a very well-known gentlemen from the coal industry, founder of Austen & Butta a number of years ago; myself, the MD; John Gaskell, a director of Dominion Mining; and

30                    Steven Lonergan, a number of you know, lawyer and he’s our company secretary. We’ve got a solid, two full-time employees and we use contractors as and when required. I guess it enables us to keep things pretty tight when we need to.

35                    That’s the snapshot of the company, like a lot of other companies everybody were suffering on the share market at the moment but the main focus on that slide I want to point to you is the share register. Sempre Metals recently took 11% stake in the company back in May. They’re a very big US-based commodity trader and we’re very pleased to have them on our register.

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                        Some recent highlights, they took an 11% stake back in May and we’ve got a period of time to negotiate an offtake at Frogmore. I’ll talk about Frogmore as we go forward from here. In July, we completed 2,500 m of drilling there and we got a number of very exciting copper intercepts with some precious

45                    metal credits. We just completed and announced drill results from our Cloncurry Joint Venture with Exco Resources and I’ll update you on that as well.

                        We’re very pleased to be in New South Wales. We think New South Wales is grossly under explored and obviously the infrastructure is fantastic. The geology is very good and there are some world-class deposits around and we’re only 100 km south of Cadia in an area that really has seen not much

5                      exploration, surprisingly little. Really, it’s quite incredible how much had a little expression it has been and that’s where we are, the red dot on the center of the Lachlan Fold Belt there. Pretty much due west of Sydney about …as the crow flies 300 km due west of Sydney, about 50 km East of Young.

10                    The infrastructure is obviously very good in this part of the world. We get down the project along the Hume highway. You can be on site in 3.5 to 4 hours, 30 km from a little township called Boorowa and that’s a population of about 5,000, I believe. Obviously, there’s bitumen right up to the edge of the project …has good rail access and electricity and every other bit of

15                    infrastructure that you would want.

                        A geology map of the main project area…the Frogmore area is…cursor isn’t working…we’re too much about that, but the Frogmore Copper Project is located right at the northern end of a strung out piece of Silurian volcanic

20                    geology and we think that’s important, we’ve pegged a 50 km strike along a shear zone which we think is also very important, and this is controlling mineralisation along that belt. There are a number of old mines controlled by the structure and located on the diagram. I’ll focus mostly on Frogmore itself and mention briefly the White Rock tungsten area and also the Democrat

25                    area to the south.

                        Frogmore here was …there was an old mine and smelter there way back in the late 1800’s and there are some high-grade material mine and smelter on site. There’s really been not much exploration done since, until we acquired

30                    the property in 2007. There were some previous drilling and most of that drilling was orientated parallel to mineralisation, so it didn’t have too much chance of hitting very much. We’ve drilled about 6,000 m in the last 12 months and done quite a lot of geophysics, as well.

35                    The copper mineralisation is chalcopyrite and this is what it tends to look like, occurs with pyrrhotite or pyrite in veins and breaches and stringers, I guess. The rock is a strongly foliated and chloridized volcanic rock and that quite green and whenever get that greeny black color to it you tend to know that you’re close to the mineralisation.  You get a wee bit of quartz but not very

40                    much, sulphides, chalcopyrite, as I said, with pyrrhotite and pyrite and there is minor with variable silver, gold, with a bit of sphalerite, zinc, and galena lead.

                        This is the principal prospect as we have at the moment. We call it the Pride of Frogmore. The Pride of Frogmore is that northeast-southwest trending

45                    lode, the water zone if you like. The old time is mined north-south shear zones. You may be able to see on the diagram the line of X’s on the right hand side of the diagram, they were north-south veins and they’re where the outcrops where. The northeast trending zone is a brand new zone that it wasn’t known about. We initially came and drilled holes east-west and realized that the mineralisation thickens along a different trend and this has opened up some new opportunities for us and some very exciting opportunities going forward. I want to point out some of the grades you can probably see those on the right hand side of the diagram. We’re very excited

5                      in there’s really fantastic potential to come up with a strong resource early in the New Year.

                        That’s the cross-section….in this instance, showing thickening as it goes down with depth. The body dips steeply to the southeast. I mentioned the

10                    northeast strike not east-west as was previously thought and there are a number of multiple lodes that are yet to be explored or drilled. This is a long-section through the Pride of Frogmore. It’s around 200 m in length. You know there’s really been not much drilling at all on a top 100 m, and that’s an area we’re going to be focusing on, that’s next in a little while. There’s a strong

15                    plunge to the south, which is on this diagram to the left, we’ve done down hole EM and there’s conductors in a number of holes indicating mineralisation is open in that southerly direction.

                        Silver, silver tends to be around higher vents. Gold is around about 0.1, so it’s

20                    too small but a significant credit and there are no duty elements as very little arsenic, for example, or any other deleterious elements. So we haven’t done any test work on the concentrate and it caught any or any metallurgical test work yet but we have every reason to believe that this material will concentrate very well.

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                        In terms of the targets on the Pride of Frogmore, we’re going to be focusing on what we described generally as open pit targets less than 100 m from surface. The underground targets, if you like, the deeper ones were such a priority first at the current time. We’re going to be working hard to generate

30                    more intersections in that top 100 m and come up with an initial resource early in the New Year.

                        Just for the geologist out there, this is quite an important slide in terms of our model and it’s quite a simple one really. I’ll just focus on the linkages if you

35                    like between the two shears and so as linkages where you get thicker, wider, better grade mineralisation in our model and this is a very well known proven model. It’s been around for a long, long time now and applying it to Frogmore, the red areas, the hot areas if you like, are the IP targets and the Pride of Frogmore, which is really one of our tested lodes as shown on the diagram

40                    and there’s a number of other targets and lots of smoke as indicated by anomalous base metal and precious metal geochemistry from soil and aircore drill holes. The area really has seen very little drilling with the exception of the Pride of Frogmore, you know, so we’ve got 1 km or more of very perspective country. The IP indicates sulphides which is a very encouraging sign and

45                    from our experience elsewhere, the sulphides tend to be mostly chalcopyrite from our experience in the Pride of Frogmore. So, it’s really an untested belt. We’re going to be getting out there very soon and testing this with more detailed geophysics and then some drilling.

                        Just in terms of… I guess where we see it in terms of comparisons with other Australian deposits. Clearly it’s not going to be (inaudible) (00:11:06) in terms of size and tonnage and I guess our target size would be sitting on that Grade Tonnage Curve somewhere around where it’s shown there in red and that’s

5                      what we’re targeting in terms of the tonnage, in terms of a target tonnage, if you like, for a copper project.

                        Being a geologist, we like to compare it with other like deposits and I guess in New South Wales we tend to compare it currently with the Cobar belt. The

10                    Frogmore belt on the left and the Cobar belt on the right. They’re at the same scale. There are a lot of comparisons with the geology and with some other textures and some of the sulphide mineralogy as well. So we got an analogy if you like in New South Wales which we’re going for and further to that just showing a long-section, same scale with CSA on the right, that’s the western

15                    zone CSA. We haven’t yet been able to reproduce those grades but obviously that’s something which we’ll be hoping to do going forward.

                        One of the other targets we’ve got nearby is the Democrat area and recently we’ve been able to come up with some very interesting gold numbers as well

20                    as copper. We’d picked up rock chips at surface there grading up to 16 g in veins and breaches and stringer zones. There’s copper up to 5%. There’s a number of old pits and workings here and there’s been almost no drilling on this three drill holes inside, a couple of square kilometers and they’re all shallow holes. So that’s another very exciting target for us in the Frogmore

25                    district.

                        I’ll mention the Tungsten project…I’ll just quickly go through that while we’re in this general neck of the woods. We define the resource there of 260,000 tonnes at 0.70% tungsten oxide and it had a tin created as well. There’s a

30                    high-grade zone as well 123,000 tonnes at 1.15% WO3 …. it’s all less than  30 m from surface.

                        The White Rock Project was mined during the 1950’s and ore was stockpiled, there’s a photograph there showing stockpiles of the tungsten ores just sitting

35                    at surface, and it’s a scan for those of who are interested in a bit of geology, and I’ll show you a cross-section now. Note this scale bar on the left, that’s pretty much the geometry of the scanned bodies. They’re flat lined replacement zones and some pretty good grades. We generated a concentrate from some test work that we did early in the year and there’s

40                    some good potential to expand this. This is a long section showing some targets beneath the granite seal as well as some vein targets from some of the (inaudible) zones on the southern and western ends. So, there’s some good potential out there at the White Rock Tungsten Project to expand the resource.

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                        This is original magnetic image 5 km scale belt at top, a number of magnetic targets that have yet to be assessed in detail.

                        In Queensland, we have a joint venture project with Exco Resources. Michael Anderson spoke yesterday you would have heard his talk. Paradigm in this case is the manager of this particular project. It’s a uranium-oil shale/ vanadium-molybdenum joint venture project. I’ll show you some of the results

5                      that we’ve come up with and we released this morning. We’ve uncovered with some drilling that we’ve done in the Toolebuc formation, some substantial areas of vanadium and molybdenum and the red dots on this diagram show holes that have generated assays higher than 0.4% vanadium as vanadium pentoxide. I’ll just point out the scale bar that’s about 10 km of

10                    prospective area and that white rectangle on the left hand side at the top, and conservatively we’ve got about 100 km of prospect of a land.

                        A cross-section of that northern prospect, just again note the scale bar. It’s a very significant package of tenements. The red contour is a grade with 0.4%

15                    vanadium contour and vanadium and the molybdenum tend to occur to give us so that’s also with the high-grade molybdenum values are. I’ll point out also the vertical exaggeration so the scale bar…the bottom of the pile yellows about 20 to 25 m. So, it’s really very shallow and quite a bit …the area has a lot of potential to really add value. What we’re really yet to ascertain is the

20                    metallurgical aspects of this material, so the next steps will be to review the extraction technologies and we’ll be doing some test work in reviewing some of the extraction technologies available in this particular type of rock.

                        Just on the right hand side of the diagram there’s also a potential for deeper

25                    uranium. There was 8 m at around 100 ppm U3O8 in one of those holes, so we’ll be looking at also the uranium potential in the deeper oil shell.

                        So, that’s basically it. I thought I’d just summarize with the three P’s, the projects, partnerships, and the people. Why Paradigm? I think we’re one of

30                    the few emerging New South Wales copper plays with a very exciting under explored copper play. We’ve got some excellent projects elsewhere as well and I’ll be happy to talk to you about those upstairs at our booth. We’re building some strong partnerships and we’ve got some very good supporters out there and we’re very pleased to have them. Of course, very importantly

35                    too we’ve got some good people in our team.

                        So, please come and talk to us up in our booth upstairs and thanks very much for the opportunity to talk to you today.

40                    Cheers.

INTERVIEW CONCLUDED

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