Quarterly Activities/Appendix 5B Cash Flow Report

• Nagambie to enter joint venture with Alkane Resources over major antimony-gold discovery
• Alkane to earn up to 80% interest through $27.5 million staged expenditure
• Alkane to become significant 13.6% shareholder in Nagambie

Nagambie Resources has announced the successful finalisation of negotiations for a proposed joint venture with Alkane Resources Ltd over Nagambie's major antimony-gold discovery at the Nagambie Mine. Alkane and Nagambie have signed a binding Term Sheet for a proposed earn-in by Alkane over Nagambie's mining licence MIN 5412 and its surrounding exploration licence EL 5511. The activities of the earn-in and subsequent potential joint venture are proposed to include exploration drilling, decline-access mine development, mine stoping operations, and potential trucking of ore to the Costerfield treatment plant. Alkane will undertake a $27.5 million staged expenditure to earn up to an 80% interest in the tenements, with Nagambie retaining 20%. Alternatively, Alkane has the option to earn 60% for $12.5 million expenditure, with Nagambie retaining 40%. On completion of the earn-in, the joint venture will be formed. Alkane will also subscribe for $2.5 million of Nagambie shares, and PPT Nominees will convert $1.5 million of its loan facility into Nagambie shares, improving the company's balance sheet. Nagambie retains 100% of its other exploration tenements, including the Whroo Mines Gold-Antimony Project and the Wandean Gold-Antimony Project.

Alkane to subscribe for $2.5 million of Nagambie shares. PPT Nominees to convert $1.5 million of its $3.0 million loan facility into Nagambie shares. Potential for significant future Nagambie free cash flow from joint venture antimony and gold production.

If the proposed joint venture is formed, Alkane will provide processing capacity, underground mobile equipment, workforce, and maintenance facilities for the joint venture operations. This would allow Nagambie to avoid the majority of capital costs and operating risks associated with developing a new mine, while retaining exposure to potential future free cash flow from antimony and gold production.