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The licence area is estimated to contain iron ore reserves and resources of
388.8 million tonnes of Russian category A, B and C ore with an average grade of
41.7% and 2,590 million tonnes of Russian resource category P1 and P2. Of the
A, B and C1 category reserves, 39% (82.5 million tonnes) is defined as 'rich
ore' and contains an average grade in excess of 50% Fe of which 67.7 million
tonnes have an average grade of 55.7% Fe.

Aricom believes that the deposit could be developed into a large scale open pit
iron ore mining and concentrating operation on the following basis. Development
of the project is expected to commence in 2007. Initial work will focus on a
comprehensive programme of confirmation drilling. Subject to and following
suitable positive results from this, a feasibility study should be potentially
completed in early 2008 and the project could be in operation as early as
2010-2011.