REPLACEMENT PROSPECTUS

Transcription

1 ELECKRA MINES LIMITED ABN Broker to the Offer HARTLEYS REPLACEMENT PROSPECTUS For the issue of up to 30 million Shares at 20 cents each to raise up to $6 million (with a minimum subscription of 20 million Shares at 20 cents each to raise $4 million). SHARES OFFERED BY THIS REPLACEMENT PROSPECTUS SHOULD BE CONSIDERED SPECULATIVE. THE OFFER IS NOT UNDERWRITTEN. THIS REPLACEMENT PROSPECTUS REPLACES THE PROSPECTUS OF ELECKRA MINES LIMITED DATED AND LODGED WITH ASIC ON 8 MAY 2006.

2 - 1 - TABLE OF CONTENTS IMPORTANT NOTICE...1 READING THIS REPLACEMENT PROSPECTUS...3 CHAIRMAN'S LETTER...4 INVESTMENT HIGHLIGHTS AND RISKS DETAILS OF THE OFFER ABOUT ELECKRA'S PROJECTS BOARD AND MANAGEMENT RISK FACTORS INDEPENDENT GEOLOGIST'S REPORT INVESTIGATING ACCOUNTANT'S REPORT EXPLORATION TITLES REPORT SUMMARY ADDITIONAL INFORMATION DIRECTORS' STATEMENT GLOSSARY OF DEFINED TERMS...75 CORPORATE DIRECTORY...80 APPLICATION FORM...81 IMPORTANT NOTICE This Replacement Prospectus is dated 13 June A copy of this Replacement Prospectus was lodged with the ASIC on 13 June ASIC and ASX and their respective officers take no responsibility for the contents of this Replacement Prospectus. The fact that ASX may admit the securities of the Company to Official Quotation is not to be taken in any way as an indication of the merits of the Company or the Shares offered under this Replacement Prospectus. The expiry date of this Replacement Prospectus is 7 June No Shares will be allotted or transferred on the basis of this Replacement Prospectus later than the expiry date. This Replacement Prospectus does not constitute an offer in any place where or to any person whom it would be unlawful to make such an offer. The distribution of this Replacement Prospectus in jurisdictions outside the Commonwealth of Australia may be restricted by law and persons who come into possession of it should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable security law. All financial amounts shown in this Replacement Prospectus are expressed in Australian dollars. This Replacement Prospectus is available in electronic format via The Offer constituted by this Replacement Prospectus in electronic form is only available to persons receiving this Replacement Prospectus in electronic form within Australia. Persons having received this Replacement Prospectus in electronic form may, during the offer period,

3 - 2 - obtain a paper copy of this Replacement Prospectus (free of charge) by telephoning Hartleys on (08) Applications for Shares may only be made on the Application Form attached to this Replacement Prospectus or in its paper copy form as downloaded in its entirety via The Corporations Act prohibits any person from passing on to another person an Application Form unless it is attached to a hard copy of this Replacement Prospectus or accompanied by the complete and unaltered electronic version of this Replacement Prospectus. This Replacement Prospectus provides information for investors to decide if they wish to invest in the Company and should be read in its entirety. If you have any questions about the desirability of or procedure for investing in the Company, please contact your stockbroker, accountant or independent financial adviser. The Shares offered under this Replacement Prospectus carry no guarantee whatsoever with respect to return of capital investment, payment of dividends or future value. REPORTING OF EXPLORATION RESULTS AND MINERAL RESOURCES The information contained in the Independent Geologist's Report (Section 5) was compiled by the Independent Geologist. Otherwise, information that relates to exploration results, mineral resources and ore reserves has been compiled by the Company and is based on information provided by Mr Russell Davis, a director of Eleckra who is a member of the Australian Institute of Mining and Metallurgy. All information of this type is expressed in terms of the 2004 edition of the "Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" ("JORC Code"). Mr Davis has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a competent person as defined in the 2004 edition of the "Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves".

4 - 3 - READING THIS REPLACEMENT PROSPECTUS This Replacement Prospectus provides information about the Company, its proposed activities and investing in its Shares, including the subject matter of Eleckra's exploration proposals, and risks and other factors which may influence those proposals. Details of Eleckra's Offer of Shares, including a summary of the proposed use of funds to be raised by the Offer, are set out in Section 1 of this Replacement Prospectus. Eleckra's proposals, including its exploration plans and information regarding its management, are set out in Sections 2 and 3 of this Replacement Prospectus. All intending investors and their advisors should read Section 2 of this Replacement Prospectus in particular to obtain an understanding of the Company's proposed activities. All readers should note there are risks associated with the Company, its proposed activities and investing in its Shares. Detailed information regarding risks is set out in Section 4 of this Replacement Prospectus and should be read to obtain an understanding of the risks connected with investing in the Company. Specific risks are also included in this Replacement Prospectus where particular matters are described. Investors and their advisors should not rely solely on the Investment Highlights and Risks on pages 6 to 8 of this Replacement Prospectus, and in particular should read the Sections referred to above. An Independent Geologist's Report is included in Section 5 of this Replacement Prospectus, and should be read by investors and their advisors to gain an independent view of the Company's exploration opportunities and proposals. An Investigating Accountant's Report setting out financial information including a pro-forma balance sheet, which should be read by investors and their advisors in order to consider the Company's financial position, is included in Section 6. An Exploration Tenements Report which contains information about the Tenements and factors which affect them has been lodged with ASIC and is available free upon request. A summary of matters in that Report and details about its incorporation into this Replacement Prospectus are included in Section 7. A Glossary of Defined Terms is included in Section 10 of the Replacement Prospectus. This sets out the meaning of and explains certain terms used in this Replacement Prospectus. If, after reading this Replacement Prospectus a decision is made to invest, instructions for applying for Shares are set out in Section 1 and on the attached Application Form(s). If you have any questions about the desirability of, or procedure for, investing in the Company, please contact your stockbroker, accountant or independent financial adviser.

5 - 4 - CHAIRMAN'S LETTER Dear Investor, On behalf of the Directors of Eleckra Mines Limited (Eleckra) it is with pleasure that I present you with this Replacement Prospectus and invite you to invest in Eleckra by subscribing for the Offer. Eleckra intends to raise up to $6 million (with a minimum subscription of $4 million) to explore the tenements that it anticipates securing upon completion of the capital raising described in this Replacement Prospectus and to investigate the potential to develop the gold resource base. Since Eleckra was incorporated in May 2004 it has entered agreements to secure tenements located in the Yamarna Greenstone Belt containing Measured, Indicated and Inferred gold Resources totalling 740,000 oz (12.6 mt at 1. 8 g/t Au). The Board of Eleckra anticipates securing these tenements at an opportune time of resurgent interest in gold following the significant uplift in the price of gold in late 2005 and continuing into To consolidate its ground position at the Yamarna Projects, Eleckra has also applied for four additional exploration licences as well as holding an exploration licence at Darkan, 60 km southeast of the world class Boddington Gold Mine. Eleckra's proposed acquisition of tenements at the Yamarna Projects comprises approximately 3,300 km 2, covering a strike length of approximately 180 km of the Yamarna Greenstone Belt. Eleckra considers the Yamarna Greenstone Belt to be one of the least explored greenstone belts within the Yilgarn Craton, an area rich with minerals that currently supplies more than half of Australia's 8 moz of annual gold production. The Board of Eleckra considers there is potential for finding new gold deposits within the Yamarna Greenstone Belt given that the fault system at the Yamarna Projects is part of a deep crustal suture, similar to the fault systems at the adjacent Laverton belt and Leonora belt to the west, which both host world class gold mines. Eleckra has a three-part exploration strategy. Eleckra's primary focus will be to explore the tenements with a view to discovering gold deposits that can be developed. At present, in the order of 15 promising structural and geochemical targets warrant early drill testing. Eleckra also seeks to build on the resource base on its acquired tenements to a sufficient size and grade to justify mine development. Given current favourable market conditions the Company intends to conduct revised scoping studies to target and determine the size and grade of potential reserves at the Yamarna North Project that may provide an adequate financial return to enable a decision to commence mining activities. Eleckra seeks to increase shareholder wealth by increasing the size of existing gold resources via a series of exploration programs. At the outset it is anticipated the exploration program will concentrate on infill and extensional drilling of high grade positions within the Attila/Alaric resource area and the Khan North and Breelya prospects. As some of the Yamarna Project tenements are also considered prospective for uranium, nickel, copper chromite and platinum group elements (PGE's) the Company plans to maximize portfolio development by farming out the rights to the non-gold commodities to parties with greater expertise in these commodities. This will form the third phase of the exploration strategy and potentially provide additional expenditure on the Company's tenements to accelerate and improve the chances of exploration success. By way of example, a section of the

6 - 5 - Thatcher Soak uranium prospect and sections of the anomalous calcrete drainage channel extend onto the Yamarna Project tenements. The Company hopes to test the potential for possible economic uranium resources at Thatcher's Soak with a modest exploration drill program in its own right or by farming out the uranium rights. The Company has negotiated the rights to acquire an attractive portfolio upon the completion of the capital raising described in this Replacement Prospectus and has assembled an experienced Board of Directors with a complementary skill base. I commend the Offer to you and look forward to welcoming you as a shareholder of Eleckra Mines Limited. Yours faithfully, Richard Revelins Chairman 13 June 2006 Eleckra Mines Limited

7 - 6 - ELECKRA'S PROJECTS INVESTMENT HIGHLIGHTS AND RISKS Eleckra has been formed to pursue exploration on tenements located in Western Australia. Eleckra has entered agreements to acquire tenements comprising its proposed Yamarna North Project and Yamarna South Project ("the Yamarna Projects"). The Yamarna Projects are constituted by 56 granted tenements and rights in respect of 14 applications for exploration licences and mining leases. Eleckra has applied for a further 4 exploration licences, which, if granted, will form part of the proposed Yamarna Projects. Eleckra project location map

8 - 7 - The Yamarna Projects are situated on the eastern margin of the Archaean Yilgarn Craton in Western Australia, some 140 km east of Laverton. These tenements cover most of the Yamarna Greenstone Belt and portions of the adjacent Dorothy Hills and Mount Venn greenstone belts within Western Australia's Eastern Goldfields. Eleckra also holds one exploration licence, centred some 60 km southeast of the Boddington gold project. The tenement, referred to as the Darkan Project, covers a section of the Darkan Fault, which the Company interprets as traversing close to the area of the Boddington gold deposit. The tenements held or to be acquired by Eleckra thereby comprise: o o o o Yamarna North Project: 42 tenements and 14 applications for tenements comprising approximately 1200 km²; Yamarna South Project: 14 tenements comprising approximately 1600 km²; Yamarna Eleckra applications: 4 tenement applications comprising approximately 500 km²; and Darkan Project: 1 tenement comprising approximately 190 km². RISK OF EXPIRY OF TENEMENTS Potential investors should note that: Applications have been made for an extension of term in respect of seven exploration licenses which have expired, four of which (E38/525, E38/526, E38/620 and E38/804) are within the Yamarna South Project and three of which (E38/687, E38/691 and E38/1315) are within the Yamarna North Project. Two of the applications (E38/687 and E38/691) have now been granted; Two exploration licenses (E38/541 and E38/544) within the Yamarna North Project have expired but remain in force subject to the determination of mining lease applications; Four exploration licenses (E38/361, E38/541, E38/544 and E38/797) and nine prospecting licenses (P38/1199, P38/2626 to 2632 (inclusive) and P38/2752) all within the Yamarna North Project which have expired or are soon to expire are the subject of applications for conversion to mining leases, and as such, the underlying exploration or prospecting licence may continue in force until the respective application for a mining lease is determined; Eight exploration licenses (E38/1386, E38/1387, E38/1545 and E38/1565 at the Yamarna North Project and E38/1504, E38/1528, E38/1539 and E38/1567 at the Yamarna South Project) are subject to statutory partial surrender within two years from the date of the Replacement Prospectus and an application for exemption from statutory partial surrender must be lodged if the holder wishes to retain 100% of the licensed area; and Five exploration licences at the Yamarna North Project (E38/1336, E38/1355, E38/1388, E38/1389 and E38/1410) became subject to fourth year partial statutory surrender obligations on 15 April 2006 and one exploration licence at the Yamarna South Project (E38/1468) became subject to third year partial statutory surrender

9 - 8 - obligations on 12 May Applications seeking exemption from these statutory partial surrender obligations have been lodged. Potential investors should note if any of the applications referred to above are not successful the tenements will either expire by effluxion of time or be subject to the provisions for statutory surrender and the Company would therefore be unable to conduct exploration activities on those tenements or the parts of tenements that were surrendered. There is no guarantee that any tenement applications or conversions in which the Company has a current or potential interest will be granted. The grant and renewal of tenements is subject to a number of specific legislative conditions including payment of rent and minimum annual expenditure commitments. The renewal of the term of a tenement (including exemptions to conditions) is also subject to the discretion of the relevant Minister. The inability to meet those conditions in relation to any of the tenements comprising the Company's Projects could restrict the ability to renew a granted tenement, adversely affecting the financial performance of the Company. OTHER KEY INVESTMENT RISKS An investment in the Company should be considered speculative. Potential investors should be aware that while the Company has entered into arrangements, or progressed arrangements, with native title claimants for access to land the subject of the Tenements, the Company makes no representation that it is given access to the land the subject of the Tenements. Furthermore, the Tenements may be subject to legislative or common law native title rights. If native title rights do exist, access to the Tenements, or progress to the development of an economic ore reserve, may be adversely affected. Also, an investment in the Company should be considered speculative as the Company's success depends upon the exploration and/or identification of economic reserves. Potential investors should note the Company's activities are speculative in nature and there can be no guarantee that any economic ore deposits, if discovered, can be successfully developed. Potential investors should refer to Section 4 for further details in respect of risk factors. MEANING OF RESOURCES This Replacement Prospectus, when referring to the Tenements within the Yamarna North Project refers to Measured, Indicated and Inferred gold Resources. "Measured", "Indicated" and "Inferred" are terms which have specific meanings when used in connection with exploration for mineral resources. Part of the purpose of the use of these terms is to enable comparison with other mining exploration results by categorising results according to increasing levels of geological knowledge and confidence. The categories are defined, and the corresponding components in respect of the Yamarna North Project are set out, in the table below.

10 - 9 - Yamarna North Resource Summary Resources At 1.0g/t Au cut off Category Meaning 000t Grade Au g/t Ounces Measured That part of a Resource 2, ,000 for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence Indicated That part of a Resource 4, ,000 for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. Inferred That part of a Resource 5, ,000 for which tonnage and/or grade can be estimated with only low levels of confidence. TOTAL 12, ,000 Note: Totals have been approximated due to rounding of resource figures. All of the above Resources are located in several deposits within a 14 km strike length within granted Mining Leases. "1.0 g/t Au cut off" refers to the minimum grade of gold per tonne (measured in grams) below which mineralised material is not included in the applicable Resource estimate. "Ounces" describes a theoretical quantity and does not indicate that the actual amount of gold which could be recovered if extraction were economically viable will equal or exceed that amount. A "Resource" is a concentration or occurrence of material of intrinsic economic interest in or on the earth's crust in such a form, quality and quantity that there are reasonable prospects for eventual economic extraction. All information about the Resources is based on data generated by parties from whom Eleckra will buy the Tenements comprising the Yamarna North Project and previous explorers. Categorisation of Resources as Measured, Indicated or Inferred does not establish or indicate that gold or any other material will be able to be extracted, processed, transported or sold economically at a particular time or at all. In each case, additional work would be required to be done and money expended to advance the assessment of a Resource to a stage which it may be determined that is it economically viable to exploit it. There is no certainty that particular Resources or any Resources will be identified by the Company as being economically viable for exploitation.

11 SECTION ONE DETAILS OF THE OFFER 1.1. Introduction The total number of Shares offered under this Replacement Prospectus is up to 30,000,000 Shares at an issue price of 20 cents each to raise up to $6 million. The minimum subscription allowable under the Offer is 20,000,000 Shares to raise $4 million. No Shares will be issued pursuant to this Replacement Prospectus unless the minimum subscription amount is received. The Shares issued under this Replacement Prospectus will be fully paid ordinary shares in the capital of the Company and will rank equally with existing ordinary shares of the Company. Minimum Subscription Maximum Subscription Number of Shares currently on issue 16,950,000 16,950,000 Number of new Shares to be issued to acquire Yamarna 10,150,000 10,150,000 Projects Number of new Shares to be issued to the Broker to the Offer 1,000,000 1,000,000 Number of new Shares offered 20,000,000 30,000,000 Total Shares on issue post Offer 48,100,000 58,100,000 Offer price per Share $0.20 $0.20 Gross proceeds from the Offer $4,000,000 $6,000,000 Market capitalisation at Offer price $9,620,000 $11,620,000 The Company also has 6,500,000 options on issue, each exercisable at $0.20 expiring on 31 March Purpose of the Offer The purpose of the Offer is to raise funds to: (a) (b) (c) (d) (e) acquire the Tenements and related mining information; subject to their acquisition, explore the Tenements pursuant to the Company's expenditure programs; provide adequate working capital to maintain the Company's core activities; satisfy maintenance costs of the Tenements; and satisfy the Company's anticipated short to medium term working capital requirements. The Company anticipates that upon completion of the Offer it will have sufficient working capital to carry out its exploration activities and stated objectives. The Company has commitments consistent with its business objectives to spend at least half of its cash raised through the Offer Use of Funds The net proceeds of the Offer and pre-existing funds available will be applied as follows:

12 Minimum Subscription Maximum Subscription Total Funds Raised at IPO $4,000,000 $6,000,000 Approximate funds available as at lodgement $131,000 $131,000 Gross funds available $4,131,000 $6,131,000 It is anticipated that the funds available will be applied as follows: Use of Funds (for first two years of operation) Minimum Subscription Maximum Subscription Tenement acquisitions $200,000 $200,000 Brokerage fees (including seed capital) $227,000 $327,000 Estimated duties $223,000 $223,000 Exploration expenditure $2,340,000 $3,700,000 Surplus working capital $55,000 $593,000 Administration $900,000 $900,000 Outstanding costs of the Offer (excluding brokerage) $186,000 $188,000 Total use of funds $4,131,000 $6,131,000 Note: The figures above were as at 8 May Since that date some obligations have been discharged in accordance with the Company's anticipated schedule for payments. Costs associated with the Offer of approximately $81,000 have been paid to date. It has been estimated that an additional $413,000 (including brokerage) will be paid on achieving the minimum subscription. If the Offer is fully subscribed an estimated additional amount of $102,000 would be incurred in respect of the costs of the Offer (including brokerage), bringing the total additional costs associated with the Offer to $515,000 (including brokerage) How to apply for Shares Applications must be for a minimum subscription of 10,000 Shares or $2,000 and thereafter in multiples of 2,500 Shares or $500. All Applications must be made on an Application Form attached to and forming part of this Replacement Prospectus or on a paper copy of the electronic Application Form which accompanies the electronic version of this Replacement Prospectus, both of which can be found at, and downloaded from, Completed Application Form(s) must be sent to the Share Registry and be accompanied by payment in full by a cheque or a bank draft in Australian dollars drawn on an Australian branch of an Australian bank made payable to the "Eleckra Mines Limited Float Account" and crossed not negotiable. Applicants should return their completed Application Forms to the Share Registry at the address shown in the Corporate Directory by no later than 5:00 pm Western Standard Time ("WST") on the Closing Date. Regardless of how they are lodged, all Applications must be received no later than 5:00 pm WST on the Closing Date unless otherwise varied. Further instructions for completing and lodging Application Forms are set out in the Application Forms attached to this Replacement Prospectus. Please note that you are not required to sign an Application Form. The Company reserves the right to reject any Application (including where an Application Form has not been correctly completed) or allocate any person fewer Shares than that person applied for, or vary the dates and times of the Offer without prior notice and independently of other parts of the Offer. Where Applications are rejected or fewer Shares are allotted than applied for, surplus application monies will be refunded to the Applicant in

13 accordance with the Corporations Act. No interest will be paid on any application monies refunded. Should the minimum subscription amount not be received within four months of 8 May 2006, the Company, at its absolute discretion, will either repay the application monies to Applicants without interest or (subject to any necessary ASIC or ASX waivers or consents being obtained) issue a supplementary or replacement prospectus and allow Applicants one month to withdraw their Applications and be repaid their application monies. Interest will not be paid on application monies refunded When to apply The Offer opened at 9:00 am WST on the Opening Date, and will close at 5:00 pm WST on the Closing Date. The Company, in consultation with the Broker to the Offer, reserves the right to either close the Offer at an earlier time and date or to extend the closing time and date without prior notice. Applicants are encouraged to submit their Applications as early as possible. Further details in respect of important dates are as follows: Offer Closes 22 June 2006 Dispatch of statements of shareholding 29 June 2006 Official quotation of Shares on ASX expected to commence 11 July Allotment of Shares The Company will hold all application monies received with Applications in a trust account until the allocations are determined. The Directors of Eleckra, in consultation with the Broker to the Offer, retain an absolute discretion in allocating Shares under the Offer and reserve the right to reject any Application or to allocate to any Applicant a lesser number of Shares than those applied for. If an allocation is not accepted, or is accepted in part only, the relevant part of the application monies will be refunded without interest. The allotment of Shares to Applicants will occur as soon as practicable after Applications and application monies have been received for all the Shares and the Offer is declared to be closed, after which statements of shareholding will be despatched. It is the responsibility of Applicants to determine their allocation prior to trading in Shares. Applicants trading Shares before they receive their statements of shareholding will do so at their own risk. Subject to the requirements of the Corporations Act, the Company also reserves the right to place Shares up to the maximum number referred to in this Replacement Prospectus after the Closing Date (but before the Company is admitted to the Official list of ASX) at the discretion of the Directors and in consultation with the Broker to the Offer ASX quotation The Company has made application for admission of the Shares offered by this Replacement Prospectus for quotation on ASX. It is anticipated that the Company's Shares will trade under ASX code "EKM". If the Company is admitted to the Official List, ASX will post details of the ASX Code allocated to the Company on its website. If the Company is not admitted to the Official List and its Shares are not admitted to quotation within three months after the date of this Replacement Prospectus, the Company will not allot or issue any Shares and will repay all application monies without interest and within the time prescribed by the Corporations Act or (subject to any necessary ASIC or ASX waivers and

14 consents being obtained) issue a supplementary or replacement prospectus and allow Applicants one month to withdraw their Application and be repaid their application monies CHESS The Company will participate in the Clearing House Electronic Sub-register System, known as CHESS in accordance with the Listing Rules and the ASTC Settlement Rules. The Company will maintain an electronic issuer sponsored sub-register and an electronic CHESS sub-register. The two sub-registers together will make up the Company's principal register of securities. The Company will not issue share certificates to investors. Instead, as soon as practicable after allotment of the Shares to successful Applicants, shareholders will receive an initial statement that sets out the number of Shares that they have been allocated in the Offer and details of the shareholder's holder identification number or sponsoring issuer number. Following distribution of these initial statements to all successful Applicants, an updated holding statement will only be provided at the end of any subsequent month during which the balance of the investor's holding of Shares changes and as otherwise required under the Listing Rules and the ASTC Settlement Rules. Holders of Shares may also request a statement at any time, however a charge may be made for additional statements. A statement (whether issued by CHESS or the Company) will also provide details of a Shareholder's Holder Identification Number (HIN) in the case of a holding on the CHESS subregister or Shareholder Reference Number in the case of a holding on the issuer sponsored subregister Restricted securities None of the Shares to be issued pursuant to this Replacement Prospectus will be restricted securities. However ASX, as a condition of granting the Company's application for Official Quotation of its Shares, may classify some or all of the existing Shares, together with those to be issued in satisfaction of the agreements described in Section 2.1, as restricted securities. Restricted securities will not be able to be traded during an escrow period which, depending on the circumstances, will usually be either twelve (12) or twenty-four (24) months. Prior to Official Quotation of the Company's Shares holders of restricted securities may be requested to enter into agreements with the Company which provide for adherence to any escrow arrangements imposed Dividend policy The Company anticipates that expenditure will be incurred in the evaluation and development of its projects. These activities are expected to dominate the two year period following completion of the Offer. Accordingly, the Company does not expect to declare any dividends during that period. Subject to the Company achieving sustained profitability and cashflow and satisfying any ongoing capital requirements, the Directors may consider declaring dividends. Accordingly, potential investors should note that the Company gives no assurance as to the level of dividends, if any, or of the franking of those dividends. The level of any dividend will depend upon, among other factors, the Company's future profits, funding requirements and tax position.

15 Acquisition Agreements SECTION TWO ABOUT ELECKRA'S PROJECTS The Company has entered into agreements for the acquisition of tenements comprising its proposed Yamarna North Project and Yamarna South Project ("the Yamarna Projects"). Details of these agreements are summarised below. The agreements also provide for the acquisition of mining information including an exploration database that the Company anticipates will provide a solid basis for future exploration. Completion of the agreements is conditional upon, among other things, the completion of the capital raising described in this Replacement Prospectus. A more detailed summary of the Yamarna Projects acquisition agreements has been lodged with ASIC on 13 June 2006 and is taken to be included in this Replacement Prospectus by operation of section 712 of the Corporations Act. The Company will give a copy of the more detailed summary of the Yamarna Projects acquisition agreements to any person who requests it during the Offer period of this Replacement Prospectus, free of charge. (a) Yamarna North Acquisition Agreement Under the Yamarna North Acquisition Agreement the Company will acquire tenements and mining information from Asarco and Yamarna Goldfields. The purchase price includes a cash component of $300,000, of which $125,000 has already been paid together with the issue of 5,000,000 Shares to Asarco and 2,150,000 Shares to Yamarna Goldfields. An announcement royalty, being the sum of $1 million if the Company establishes ore reserves containing at least 400,000 oz of gold is also to be paid to Asarco. The Company has also agreed to pay Asarco a net smelter royalty being 1% of net smelter returns over and above 400,000 oz of gold produced from the Yamarna North tenements, capped at a maximum of $500,000 per annum. Under the Agreement, the Company must pay Messrs Harold Carmody, Neil Gill and Trent Stehn a gold ore royalty for each dry tonne of ore treated from commercial mining operations on part of the Yamarna North tenements on an incremental scale up to a maximum of $2.00 for each dry tonne in respect of gold ore with a grade of 4.5 g/t Au or more. Messrs Carmody, Gill and Stehn are also entitled to a copper ore royalty of $1.00 for each dry tonne of copper ore treated which has a copper grade of greater than 20 kilograms/tonne. Also, the Company will acquire a pastoral lease comprising 1,438 km² ("the Pastoral Lease"). The acquisition of the Pastoral Lease, while not central to the Company's activities, will help facilitate access for the conduct of the Company's exploration activities. (b) Yamarna South Acquisition Agreement Under the Yamarna South Acquisition Agreement the Company will acquire tenements and mining information from Terra Gold Mining. The purchase price includes a cash component of $100,000, which has already been paid, together with the issue of 3,000,000 Shares to Terra Gold Mining.

16 Ancillary to the Yamarna South Acquisition Agreement, the Company has agreed to pay Terra Gold Mining an announcement royalty of $1 million upon establishing resources of 750,000 oz of gold, payable in Shares or cash, at Terra Gold Mining's election. The Company has also agreed to pay a net smelter royalty of 1% of the net smelter returns over and above 400,000 oz of gold produced from the Yamarna South tenements capped at a maximum of $500,000 per annum. (c) Local Indigenous Groups The Yamarna North Acquisition Agreement and the Yamarna South Acquisition Agreement are subject to, among other things, execution of various deeds of assumption to be entered into with local indigenous groups. Under these deeds the Company will assume, among other things, the obligations to: pay to the applicable local indigenous groups 5% of the annual rent paid to the State of Western Australia in respect of the Yamarna North tenements until commercial production commences, and thereafter pay amounts to local indigenous groups upon the first and subsequent anniversaries of the commencement of commercial production of gold and minerals other than gold, and pay any compensatory amounts to local indigenous groups; give employment and contract preference to indigenous bodies or groups where possible; inform local indigenous groups of proposed exploration or mining activities, conduct heritage surveys so that Aboriginal sites are avoided, and consult with local indigenous groups to minimise disturbance to identified Aboriginal sites; cease all work in the immediate vicinity of any Aboriginal burial site that is discovered and to notify appropriate local indigenous persons, and prevent harm or interference with any cultural sites sacred to local indigenous groups, burial grounds, indigenous and historical relics, environmental features, and built infrastructure such as roads and pipelines; and protect and rehabilitate the environment Yamarna Projects The Yamarna Projects are located east of Laverton on the eastern edge of the Yilgarn Craton. The Yilgarn Craton currently produces more than half of Australia's 8 moz of annual gold production. The Company's objective at the Yamarna Projects is to increase shareholder wealth by locating additional higher grade gold resources, which when combined with the existing identified resources, may facilitate a viable mining operation. The Yamarna Projects are principally gold projects with a demonstrable mineralised gold trend occurring in a greenstone belt that is at an early stage of exploration. In addition to the existing gold resources, a new gold discovery in 2004 at Khan North, which had a best RC intersection of 37m at 8.2 g/t Au from 40m (true width 6m) has potential to add to the resource base and warrants further drilling.

17 Previous exploration within the Yamarna South tenements has generated a range of partially tested gold targets throughout the Yamarna South tenements. The best RC intercepts were recorded at the Breelya prospect with results including 8m at 8.9 g/t Au (including 2m at 31.9 g/t Au) from 38m within a dolerite showing extensive quartz-sericite-pyrite alteration. The Company believes there is scope to discover more gold mineralisation at the Yamarna Projects, given the lack of intensive historical exploration activity. As with many greenstone belts in the Yilgarn Craton region of Western Australia, the Yamarna Greenstone Belt may be prospective for several commodities as well as gold, with potential for copper-nickel, PGE's, chromite and uranium. Yilgarn Craton, Yamarna and Darkan Project Locations and Gold Endowment and Resources

18 Deep seismic reflection survey results The prospectivity of the Yamarna Greenstone Belt is further supported by the results of a deep seismic reflection survey carried out in 2001 which indicated that the Yamarna Greenstone Belt has a similar structural architecture to the highly productive multi million ounce Laverton and Leonora belts to the west. The presence of a major deep-crustal shear zone and associated complex structural corridor is considered to have positive implications for the formation of major gold deposits Anticipated exploration at Yamarna Projects The Company anticipates that its exploration program will concentrate on drilling out extensions of higher grade positions within the Attila/Alaric resource area, drilling established targets and generating new structural and geochemical drilling targets in lightly explored areas. The mining information that the Company will acquire under the acquisition agreements described above is well organized. A substantial amount of data collection, processing and assessment has been undertaken. Of particular significance is the high-resolution aeromagnetic dataset that covers much of the Yamarna Projects. Because of the extent of surficial cover the geophysical dataset has been particularly useful for geological and structural interpretation and target definition. The exploration database includes details of surface and drill hole geochemical information. Past explorers have generated a broad range of anomalies based on these datasets. Historically, the gold geochemical anomalies of the size and strength defined may represent ore grade mineralization and in many cases warrant infill drilling. The Company intends to utilise historical information in respect of the Yamarna Greenstone Belt to prioritise this range of drill targets and to maximise the chances of exploration success. There are prospective RC drill targets generated within the existing deposits and prospects that may increase the resources base that the Company anticipates that it will acquire. These targets include the high-grade zones in the Attila/Alaric resource area, the Khan North and the Minnie Hill/Breelya prospects predominantly situated along a regional scale structural zone the Company has termed the Yamarna Shear Zone. Outside of the resource area most of the Yamarna Shear Zone has only received reconnaissance level drilling, and substantial sections of the strike have not been tested. Also, most of the drilling that has been undertaken is to a relatively shallow depth. From the limited work done it is apparent that this shear zone may be mineralised over an extensive strike length. There are also several targets identified that require additional RAB and/or aircore drilling in order to better define the anomalies prior to RC drilling. These targets include the Turnberry, Augusta, Tobin Hill, Central Bore and Dorothy Hills gold prospects. These targets occur both along the Yamarna Shear Zone and in other structural positions elsewhere within the belt. Particular structural situations can control the location of higher grade ore shoots within mineralised zones and the Company intends to apply the available exploration techniques and data processing in order to focus drilling on the prospective targets within these zones. As exploration proceeds the Company anticipates reassessing and prioritising the targets in order to maximise the chances of success. Target generation will also continue, focussing on areas with favourable rock types and structures that have received little or no previous attention. This process will also allow the relinquishment of less prospective tenements - thereby reducing the project expenditure commitment. Prospects targeted for drilling may be summarized as follows:

19 RC drilling: Attila North Alaric Khan North Breelya/Minnie Hill Infill/targeted RAB and aircore drilling: Augusta Turnberry/Yaffler Tobin Hill/Central Bore Dorothy Hills Thatchers Soak Kingston Heath Wanderrie Sun River Reconnaissance RAB and aircore drilling: Yamarna Shear Zone - gaps in coverage Mount Venn - targeting copper-nickel mineralized trend The Company anticipates that it will undertake further investigations using up to date operating cost and gold price parameters to determine the potential for developing an operation at the Yamarna Projects from the resources outlined to date. In particular the Company intends to investigate the optimum extraction method to use in order to exploit the low grade bulk ore tonnages at the Yamarna Projects. Such studies may investigate heap or dump leaching options and large scale treatment plant options Darkan The Darkan Project covers an area of approximately 190 km². The Darkan tenement is centred 60 km to the southeast of the Boddington gold-copper deposit, a large undeveloped gold deposit with current reserves of 11 moz of gold. The partners of the consortium that own the Boddington deposit have recently announced that they will proceed with the development of that project. The Boddington deposit is located in the Saddleback greenstone belt and is interpreted as a structurally controlled, intrusion related deposit. The deposit is situated close to a major southeast trending fault zone and is intruded by late stage felsic intrusives and disrupted by cross faulting. Interpretation of aeromagnetic imagery by the Company suggests this fault zone extends out of the Saddleback greenstone belt to the southeast through the Darkan tenement. The fault displays structural dislocations and flexures, which will provide the initial focus for Eleckra's exploration. In addition, possible late-stage felsic intrusions have been mapped along the fault within the Darkan tenement. The Darkan tenement includes up to 35 km of strike length of the fault zone Anticipated Darkan Project exploration strategy and program The Company's anticipated exploration approach for the Darkan Project in the first two years following it being granted will be designed to assess the fault for gold deposits. The Company anticipates that work will comprise: obtaining and reviewing previous exploration results;

20 mapping, soil and rock chip sampling programs, initially along public access roads and tracks that cross the favourable structural and geological positions; reaching agreements with the relevant private landholders where anomalous areas are found; and conducting further sampling and mapping and drilling if warranted Eleckra tenement applications The Company holds four exploration licence applications that if granted will secure prospective stratigraphy and structures within the Yamarna Greenstone Belt adjacent to the Yamarna North and Yamarna South tenements. Previous explorers have outlined several gold anomalies in soil and from RAB drilling Anticipated exploration budgets It is intended that programs will range from grass roots exploration aimed at developing anomalies through to detailed assessments of geophysical and geochemical targets. The Company has prepared anticipated two year exploration programs and budgets for the scenario where the minimum subscription of A$4 million is raised and for the scenario where the full subscription of A$6 million is raised. The budgets are believed to be consistent with the exploration potential of the projects. The anticipated exploration budget summary if the Offer is fully subscribed is as follows: Project Year 1 Year 2 Total Yamarna North and South $1,792,000 $1,792,000 $3,584,000 Darkan $58,000 $58,000 $116,000 Total $1,850,000 $1,850,000 $3,700,000 The anticipated exploration budget summary if only the minimum subscription of A$4 million is achieved is as follows: Project Year 1 Year 2 Total Yamarna North and South $1,282,000 $942,000 $2,224,000 Darkan $58, 000 $58,000 $116,000 Total $1,340,000 $1,000,000 $2,340,000 It should be recognised that the anticipated budgets may be modified from time to time depending on the results obtained from exploration as it is carried out. The Company anticipates that modification may involve an ongoing assessment of each of the prospects and may lead to increased or decreased levels of expenditure on certain prospects reflecting a change in emphasis. This is particularly true of year two expenditures that are dependent on the outcomes of year one programs. As a result of the implementation of amendments to the Mining Act 1978 (WA) in February 2006 an increase in expenditure commitments will apply following the next anniversary of each exploration licence. In the event that the expenditure proposed for the Yamarna Projects is less than the statutory exploration commitment for the tenements, the Company has available to it a number of ways to manage that commitment, including selective relinquishment of tenements, applying for and receiving exemptions from these statutory commitments, reverting current mining lease applications to exploration or prospecting licences and the potential to introduce a joint venture partner to all or some of the Yamarna South, Yamarna North or Darkan Project tenements.

21 Other commodities The Company intends to progress uranium and nickel exploration at the Yamarna Projects and may explore opportunities with reputable joint venture partners with greater expertise in these commodities, potentially releasing funds for further exploration activity. Evaluation of previous drilling data and airborne uranium radiometric data indicates that some of the Tenements cover a section of the Thatchers Soak calcrete-hosted uranium prospect and extensions of the anomalous drainage channel. The Company may test the potential for possible economic uranium resources at Thatcher's Soak with a modest exploration drill program in its own right or farm out these rights. The Company considers that the layered mafic-ultramafic sequences in the Yamarna Greenstone Belt and within the southern sections of the Mount Venn greenstone belt have as yet untested potential for Ni-Cu, PGE's and chromite.

22 SECTION THREE BOARD AND MANAGEMENT 3.1. Directors' and Company Secretary profiles Richard Revelins, BEc, Non Executive Chairman, Age 44 Richard Revelins was appointed to the Board of Eleckra on 23rd November Mr Revelins has held senior executive positions in merchant banking and stockbroking firms and has acted as an advisor to a number of public companies in such matters as takeovers, mergers and acquisitions, sale of businesses, debt and equity raisings and strategic financial advice. Mr Revelins is currently chairman of Atlas Iron Limited. He is a director of Yamarna Goldfields Limited, Mintails Limited, X-ploration Limited, Cangold Limited (Canada), Peregrine Corporate Limited, Peregrine Securities NL and Peregrine Strategic Limited. He is company secretary of Prana Biotechnology Limited. Richard Harris, BSc(Hons), Managing Director, Age 48 Richard Harris was appointed as Managing Director of Eleckra on 7th November Mr Harris has 25 years experience in the mining and stockbroking industries and his prior positions include senior mining analyst Hartleys Limited, senior business analyst - acquisitions WMC Limited and international mining analyst - Associate Director Shearson Lehman Hutton Ltd, London. Mr Harris holds a Bachelor of Science Honours degree in Mining Engineering from the University of Wales, UK. Mr Harris has considerable experience evaluating mining companies and projects, advising and raising capital for resource companies. Having specialised in the junior gold sector Mr Harris has established a wide network of relationships with senior executives and management across both the mining and financial markets and brings strong skills and experience in project and company evaluations, acquisition strategy and negotiation. Russell Davis, BSc(Hons), MBA, MAIMM, FFIN, Exploration Director, Age 48 Russell Davis was appointed to the Board of Eleckra on 28th May He is a geologist with 25 years experience in mineral exploration, management, property acquisition, mining and development. During this period Russell has worked on the exploration and development of a range of commodities for companies including Texasgulf Australia Ltd, Elf Aquitaine Australia Ltd, Noranda Australia Ltd, Asarco Australia Ltd, Wiluna Mines Ltd and Asarco. Mr Davis brings with him considerable expertise, in particular, given Mr Davis's association with Asarco, Mr Davis is familiar with many details of the Yamarna Projects. Mr Davis has held senior positions including Chief Mine Geologist, Exploration Manager and Regional Manager for Asarco. In recent years Mr Davis has been responsible for instigating and managing mineral exploration activities for Asarco and for acquiring projects held by Eleckra Mines Limited. Mr Davis holds a Bachelor of Science with Honours from the University of Queensland, a Graduate Diploma of Applied Finance and Investment from the Securities Institute of Australia and an MBA from Deakin University. Mr Davis is a Member of the Australasian Institute of Mining and Metallurgy and a Fellow of the Financial Services Institute of Australasia.

23 Bruce McCullagh, CPA, ACIS, Company Secretary, Age 59 Bruce McCullagh has a wide range of experience in accounting and company secretarial and management roles in the petroleum and mineral industries in Australia, Libyan Arab Republic, the Arabian Gulf, the United Kingdom and the United States of America. He is a Certified Practising Accountant and a member of the Chartered Secretaries Institute of Australia Corporate governance practices and conduct The Company has in place corporate governance practices to ensure that the Company is effectively directed and managed, risks monitored and assessed, and appropriate disclosures made. The Board has a number of mechanisms in place to ensure that these matters are effectively addressed. Key aspects of the Company's Corporate Governance Policy set out details in respect of: the Board; the Nomination Committee; the Remuneration Committee; the selection and appointment of new directors; the code of conduct for directors and key executives; the policy on securities trading; the policy on the selection of an external auditor; communication with and participation of shareholders; respecting the rights of shareholders; risk management; and fair and responsible remuneration. The Board will consider on an ongoing basis the procedures set out in its Corporate Governance Policy and whether or not they are sufficient given the Company's size, complexity and operations. Potential investors should note that due to the small size and operations of the Company, the Board will meet as a whole to deal with the key aspects of the Company's Corporate Governance Policy as required from time to time. The Company will provide a statement in its annual report disclosing the extent to which it has followed the procedures set out in its Corporate Governance Policy. The Company will identify in its annual report aspects of its Corporate Governance Policy that it has not followed and will give reasons for not following them Continuous disclosure The Company will comply with its continuous disclosure obligations to ASX upon admission to the Official List. The Company anticipates that this commitment will promote transparency and investor confidence, and will ensure shareholders and the financial markets are provided with timely information about its activities. The Company will post all information released pursuant to the Company's continuous disclosure obligations as soon as possible following disclosure on the Company's website at

24 SECTION FOUR RISK FACTORS The future performance of the Company and the future investment performance of the Shares offered under this Replacement Prospectus may be influenced by a range of factors. Some of these factors can be mitigated. However, many are outside the control of the Board and the Company. Prior to making any decision to accept the Offer, investors should carefully consider the following general and specific risk factors applicable to the Company Legislative changes, Government policy and approvals Changes in government regulations and policies may adversely affect the financial performance of the Company. For example, whilst increased Tenement rentals as a result of amendments to the Mining Act have been taken into account in the Company's anticipated budgets, the Company cannot foresee the full extent of these additional increases in the future. These increases may impact on the Company's actual financial statements. The Company's capacity to explore and mine, as well as industry profitability generally, may be affected by changes in government policy, which are beyond the control of the Company General economic conditions Changes in the general economic climate in which the Company operates may adversely affect the exploration activities of the Company. Factors that may contribute to that economic climate include, the general level of economic activity, interest rates, inflation and other economic factors. The price of commodities and level of activity within the mining industry will also be of particular relevance to the Company Unforseen expenses While the Company is not aware of any expenses that may need to be incurred that have not been taken into account, if such expenses were subsequently incurred, the anticipated budgets of the Company may be adversely affected Operation and development risks By its nature, the business of exploration, mineral development and production is subject to a variety of risks which are beyond the control of the Company. These risks may adversely impact the Company's activities and include, but are not limited to, force majeure events such as adverse weather, industrial accidents, technical failures, labour disputes, acts of terrorism, earthquake, fire and explosion. Whilst the Company has taken out insurance in an endeavour to reduce the effect of any of these risks, the Company gives no assurances that such insurance will be adequate Native title and aboriginal heritage issues Both the Native Title Act 1993 (Commonwealth), related State native title legislation and Aboriginal land rights and Aboriginal heritage legislation may affect the Company's ability to gain access to prospective exploration areas or validity of title. Tenements may be subject to legitimate common law native title rights. If native title rights do exist, access to the Tenements, or progress to the development of an economic ore reserve, may be adversely affected. Compensatory obligations may be necessary in settling native title claims lodged over tenements held or acquired by the Company. The level of impact of these matters will depend, in part, on the location and status of the Tenements. At this stage, it is not possible to

25 quantify the impact (if any) that these developments may have on the operations of the Company. Yamarna Goldfields and Asarco commenced a process of negotiation towards entering an access agreement with the Cosmo Newberry, a native title claimant. The Company intends to continue these negotiations towards procuring an access agreement after settlement of the Yamarna North Acquisition Agreement Commodity price risk The Company's prospects and share price will be influenced by the price obtained from time to time for the commodities targeted in its exploration programs. Commodity prices fluctuate and are affected by factors including the relationship between global supply and demand for minerals, forward selling by producers, the cost of production and general global economic conditions. The outlook for inflation, interest rates, currency exchange rates and supply and demand issues also affects commodity prices. These factors may have an adverse affect on the Company's prospects, as well as its ability to fund its future activities Environmental risks The Company's operations and projects are subject to State and Federal laws and regulations regarding environmental hazards. The Company's activities are expected to have an impact of the environment. The Company intends to conduct its activities in an environmentally responsible manner, in accordance with applicable laws and regulations Share market risk The market price of the Shares can be expected to rise and fall in accordance with general market conditions and factors specifically affecting the Australian minerals and resources sector and exploration companies in particular. Neither the Company nor its Directors warrant the future performance of the Company or any return on investment in the Shares Reliance on key personnel In formulating its exploration programs, the Company relies to a significant extent upon the experience and expertise of key personnel. Although information concerning the Company and the Tenements has been chronicled, the loss of one or more of these key personnel may adversely affect the Company's prospects of pursuing its activities Future capital needs and additional funding The future capital requirements of the Company will depend on many factors including the results of the proposed exploration activities. Should the Company require additional funding there can be no assurance that additional funds will be available on acceptable terms, or at all. Any inability to obtain additional funding, if required, may have an adverse effect on the Company's activities and its financial condition and performance Resource estimations Despite resource estimates in this Replacement Prospectus having been made in terms of the JORC Code, estimates have been made by observations and are subjective in nature and may prove to be inaccurate and adversely affect the Company's activities.

26 Exploration Mineral exploration and development activities are high risk undertakings. The Company's exploration of the Tenements may not result in the discovery of an economic ore deposit. If economic ore deposits are discovered, there can be no guarantee that these deposits can be developed Joint venturers and/or third party arrangements Whilst the Company anticipates that it may enter into joint venture or third party arrangements for the exploration, development and/or exploitation of minerals there can be no guarantee that these arrangements will be successful.

27 SECTION FIVE INDEPENDENT GEOLOGIST'S REPORT

28 Contents SECTION FIVE 1. Independent Geologist's Report 26 FIGURES Figure 1 Location map of the Eleckra projects 28 Figure 2 Yamarna tenement and prospect locations on greyscale aeromagnetic image 30 Figure 3 Yamarna project - regional geological setting 32 Figure 4 Geology of the Attila-Alaric gold deposits 35 Figure 5 Attila cross section 10040N (see figure 4 for location) 36 Figure 6 Attila cross section 9040N(see figure 4 for location) 36 Figure 7 Attila cross section 18300N (see figure 4 for location) 37 Figure 8 Distribution of drill holes 39 Figure 9 Plan of Khan North showing location of drill holes containing anomalous gold on aeromagnetic greyscale image 40 Figure 10 Khan North section 36400N 41 Figure 11 Breelya and Minnie Hill prospects - location of anomalous drill samples on aeromagnetic image 42 Figure 12 Central Bore and Tobin Hill prospects - location of anomalous drill samples on gold-in-soil geochemical image 43 Figure 13 Sun River and Wanderrie Prospect - Location of anomalous drill samples on aeromagnetic image 44 Figure 14 Dorothy Hill prospect - location of anomalous drill samples on aeromagnetic image 45 Figure 15 Muirfield, St Andrews, Pine Valley, Spearwood and Pebble Beach prospects - location of anomalous drill samples on aeromagnetic image 46 Figure 16 Mt Venn prospect - aeromagnetic image showing the extension of prospective Cu-Ni lithology into 38/ Figure 17 Geology of the Yamarna Cr-PGE prospect 48 Figure 18 Thatchers Soak prospect - radiometric image showing extension of the anomaly into E38/1083 and Figure 19 Darkan project - aeromagnetic image showing similar structural setting to the Boddington-Wandoo deposits 52 TABLES Table 1 Yamarna project tenement summary 29 Table 2 Yamarna project tenement schedule 31 Table 3 Yamarna Mineral Resources at June Table 4 Attila/Alaric Significant Drilling Results 37

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57 SECTION SIX INVESTIGATING ACCOUNTANT'S REPORT Due to the renumbering of Sections in this Replacement Prospectus, references to Sections in this report should be read as follows: - Section 3.3 (Use of Funds) is now Section Section 7 (Risk Factors) is now Section 4. - Section 8 (Independent Geologist's Report) is now Section 5. - Section 10 (Exploration Titles Report) now see Section 7. - Section 11 (Contract details) now see Sections 2.1 and 8.4.

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