Corporate Governance

The Directors consider the governance procedures are appropriate relative to the size and stage of development of the Group.

UK Corporate Governance Code

The Listing Rules of the Financial Services Authority incorporate the UK Corporate Governance Code which sets out the principles of Good Governance and the Code of Best Practice for listed companies. Although the Company is not required to comply with the Code, the Board consider its principals, while also being mindful of the Company's size and activities, when assessing the adequacy of its Corporate Governance procedures.

The Board of Directors

The Board consists of three executive directors and four non-executive directors, including the Chairman Mr Gerard Holden. Each of the executive directors has a wealth of minerals exploration and development experience. The non-executive directors similarly have considerable experience in minerals industry, finance and corporate development.

The Board considers Mr Greg James and Mr David Weill to be independent.

Mr Gerard Holden has been a director and chairman of the Company for four years, prior to which he was employed by Barclays Capital who have advised the Company. On his appointment he was awarded 200,000 share options. The Board consider that neither of these, either separately or together, impair his ability to make decisions objectively in the interest of the Company although he does not satisfy the criteria as defined by the Combined Code for an Independent Director.

The Board considers that its current composition is satisfactory, taking into account the size and scale of the Group's activities and no one individual or group dominates the decision making process. The composition of the Board, including the balance between Executive and Non-Executive Directors will continue to be reviewed to ensure that the Board continues to have the appropriate structure and skills to meet the needs of the Company as its business develops.

The Board meets regularly through the year, providing effective leadership and overall management of the Group's affairs through the schedule of matters reserved for its decision. This includes the approval of the Group's forecast and budget, major capital expenditure, risk management polices and approval of the financial statements. Formal agendas, papers and reports are sent to the Directors in a timely manner prior to Board meetings.

The Board delegates certain of its responsibilities to the Board Committees which have clearly defined terms of reference.

The Audit Committee

The Audit Committee considers the Group's financial reporting (including accounting policies) and internal financial controls. The Audit Committee consists of Mr Gerard Holden, Mr Greg James and Mr David Weill and is responsible for ensuring that the financial performance of the Group is properly monitored and reported on.

The Remuneration Committee

The Remuneration Committee is responsible for making recommendations to the Board on Directors' and senior executives' remuneration. It consists of Mr Gerard Holden, Mr Greg James and Mr David Weill. Non Executive Directors' remuneration and conditions are considered and agreed by the Board. Financial packages for the Executive Directors are established by reference to those prevailing in the employment market for executives of equivalent status both in terms of level of responsibility of the position and their job qualifications and skills. The Committee will also have regard to the terms which may be required to attract an equivalent experienced executive to join the Board from another Company.

The Nominations Committee

The Nominations Committee makes recommendations to the Board for the recruitment of Directors and senior executives. The Nominations Committee consists of Mr Gerard Holden, Mr Greg James and Mr David Weill.