Reedy Lagoon Corporation Limited has received preliminary results from its collaboration with the CSIRO to develop a method of determining magnetite resources using petrophysically constrained magnetic modelling. The Company's interest in this work is in gaining information that can be used to guide its drilling to determine a Mineral Resource for the Burracoppin Magnetite Deposit located between Perth and Kalgoorlie in Western Australia. The work completed to date by the CSIRO has included sub-sampling of intervals of core to obtain petrophysical data which were used to calculate relationships between iron grade, magnetic susceptibility and density.

These data were then used to generate a 3-D magnetic/density model of the mineralization using the airborne magnetic data from the survey flew in 2010/11. Results to date have been presented to the Company and its consultant, H & S Consultants Pty Ltd, with preliminary modelling being most encouraging. Additional assay data are expected later this month and will be incorporated into the model once available.

The CSIRO model of the deposit incorporates complicated structure involving double plunging superimposed folding cut by numerous north to east-north-east striking faults. The CSIRO's investigations found magnetite morphology showing stratiform layering and shear related fabrics. It is thought that structure has controlled magnetite replacement but the replacement is locally stratiform.

This would reduce the significance of the dip of individual structures as any dip may be only local. The CSIRO model has potential to significantly assist the Company's planned drilling. The CSIRO model presents an alternative interpretation of the deposit geometry that differs significantly from that used to initially plan the Company's drilling to determine whether a Mineral Resource is present in the project area.