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Annual Report 2009 Annual Report 2009 ABN

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Annual Report 2009 Annual Report 2009 ABN Powered By Docstoc
					Annual Report 2009
         ABN 26 116 478 703
Contents



 Company Profile                                                           01
        Toronto Stock Exchange Listing                                     02
 Mantra’s Vision                                                           02
 The Mantra Mission                                                        02
 Mantra’s Core Values                                                      02
 Corporate Overview                                                        04
 Tanzanian Projects                                                        05
            Mkuju River Project                                            05
            Mbamba Bay Project                                             13
            Regional Karoo Targets (Southern Tanzania)                     14
            Bahi North and Handa Projects                                  14
 Mozambique and Malawi Projects                                            14
            Zambezi Valley Project - Mozambique                            14
 Sustainable Development                                                   16
            Health and Safety                                              16
            Environment                                                    16
            Community Relations                                            18
 Annual Financial Report                                                   19        Uranium mineralisation under ultraviolet light
 Corporate Governance                                                      96
 Additional Information                                                   104




Corporate Directory
Directors                                                Share Registers                             Stock Exchange Listings
Mr Ian Middlemas          Chairman                       Australia                                   Australian Securities Exchange
Mr Robert Behets          Joint Managing Director        Computershare Investor Services Pty Ltd     ASX Code: MRU - Fully paid ordinary shares
Mr Matthew Yates          Joint Managing Director        Level 2, 45 St Georges Terrace
                                                                                                     Toronto Stock Exchange (note - pending)
Mr Colin Steyn            Non-Executive Director         Perth WA 6000
                                                                                                     TSX Code: MRL - Fully paid ordinary shares
Mr Mark Pearce            Non-Executive Director
                                                         Telephone:               1300 557 010       Solicitors
Country Manager - Tanzania                               International:         +61 8 9323 2000
                                                         Facsimile:             +61 8 9323 2033      Hardy Bowen Lawyers
Mr Tony Devlin
                                                         Canada                                      Auditor
Company Secretary
                                                         Computershare Investor Services Inc.        Deloitte Touche Tohmatsu
Mr Luke Watson                                           100 University Avenue
                                                         Toronto, Ontario, M5 J2Y1                   Website
Registered and Principal Office
                                                         Canada                                      www.mantraresources.com.au
Level 9, BGC Centre
28 The Esplanade                                         Telephone:             +1 416 263 9449
Perth WA 6000                                            Facsimile:             +1 416 981 9800
Telephone: +61 8 9322 6322
Facsimile: +61 8 9322 6558
Company Profile


Mantra Resources Limited is a dynamic and emerging uranium company focused on aggressively
fast-tracking the exploration, appraisal and potential development of its flagship Mkuju River Project
in Tanzania, in order to fulfil its vision of becoming a significant uranium producer by 2012.
Results to date at the Company’s wholly owned Mkuju River               Over the next twelve months Mantra will continue to focus on
Project (‘MRP’ or ‘the Project’) located in southern Tanzania           advancing the MRP to development status, whilst progressively
have confirmed the presence of widespread surface uranium               working up and evaluating targets on its pipeline of additional
mineralisation and multiple thick mineralised horizons at               quality projects in Tanzania which predominantly cover highly
shallow depths within the 100km2 area known as the                      prospective Karoo age sediments. On satisfactory completion of
Nyota Prospect (‘Nyota’).                                               the PFS, the Company will move to complete the BFS quickly,
                                                                        with a view to expediting its transition from explorer to producer.
To date an Inferred Mineral Resource of 35.9 million pounds
U3O8 (39.9 million tonnes @ 409ppm U3O8, using a lower cut-             During the year, the Company has achieved a number of key
off grade of 200ppm U3O8) has been estimated for the Nyota              project milestones and advanced its status during a challenging
Prospect. This initial Mineral Resource Estimate (‘MRE’) is based       period for mineral resources companies. This progress is
on drilling that covers only a small part of the total area of Nyota,   attributed to a robust cash position, a strategic alliance with
and the potential exists to substantially expand the resource           Highland Park S.A. (includes original founders and former
base with ongoing work.                                                 executives of LionOre Mining International Limited) and a strong,
                                                                        supportive shareholder base. Furthermore, the Board of Mantra
A Scoping Study completed in June 2009 confirmed the                    includes Directors experienced in the resources industry and
technical and economic viability of the Project, and its capacity       the Company’s technical team has experience in uranium
to operate with strong cash margins. Using the current MRE as a         exploration as well as operating in African environments, in
base case scenario, the Project can support a minimum annual            particular Tanzania and southern Africa.
production of 2.5 million pounds U3O8 for a minimum ten year
mine life.                                                              The continued growth of Mantra will be further propelled by
                                                                        positive results from the MRP, its pipeline of additional projects
A Pre Feasibility Study (‘PFS’) has commenced as a prelude to a         and other strategic acquisitions. The advancement of the
Bankable Feasibility Study (‘BFS’) and the Company aims to be           MRP will position the Company to increase stakeholder value
in production in 2012.                                                  through the successful exploration, appraisal and ultimately the
                                                                        development of its uranium projects.


                                                      2009                  2010                     2011                    2012
 Pre Feasibility Study

 TSX Listing

 Drilling

 Resource Estimation

 Bankable Feasibility Study

 Permitting

 Project Financing

 Construction

 Commissioning & Production




                                                                                                     Mantra Resources Annual Report 2009      1
  Vision, Mission, Values


  Toronto Stock Exchange Listing                                                       THE MANTRA MISSION
  The Company intends to list on the Toronto Stock Exchange                            Mantra will achieve this vision through a purposeful focus on
  (‘TSX’) during October 2009 and is in the process of filing its                      the following themes in its business:
  Application with TSX. Mantra’s TSX code will be ‘MRL’.
                                                                                       •	 Utilising all of its resources efficiently and responsibly;
  The Directors believe that a dual listing on the TSX represents                      •	 Conducting its business in an environmentally
  an important milestone in the Company’s development and                                 responsible manner;
  will further raise the profile and status of the Company within
                                                                                       •	 Safeguarding the health and safety of all its stakeholders;
  the global investment community. The dual listing on the TSX
  will provide increased liquidity to the Company’s current and                        •	 Continuously improving all of its systems and processes;
  future shareholders and provide increased access to the large                        •	 Developing its people and recognising superior
  Canadian and other northern hemisphere capital markets.                                 performance; and
                                                                                       •	 Fostering mutually beneficial relationships with
  The Company has engaged Haywood Securities Inc. (‘Haywood’)                             its stakeholders.
  to act as the Company’s sponsor for the intended TSX listing.

  The Company will maintain its existing listing on the Australian
  Securities Exchange (‘ASX’, code MRU) as its primary listing.




                                                                                       View from the MRP camp site

                                                                                       MANTRA’S CORE VALUES
  Mantra senior management inspect drill cuttings
                                                                                       Mantra will build an organisation that reflects the
  MANTRA’S VISION                                                                      core values of:
                                                                                       •	 Teamwork
  Mantra’s vision is to be a uranium producer
                                                                                       •	 Integrity
  delivering superior value to its stakeholders.
                                                                                       •	 Caring
  This objective is pursued through strategies which draw on the                       •	 Transparency
  technical, financial and corporate strengths of the Company to
                                                                                       •	 Innovation
  provide multiple opportunities.
                                                                                       •	 Commitment

                                  OUR VISION
   REgIONAL “KAROO” TARgETS
   zVp - MOzAMbIqUE
                                                                                       “We aim to be a
                                                               MARKET CApITALISATION




   MbAMbA bAy pROjECT
   MRp SATELLITES
                                      pROdUCTION
                                                                                       uranium producer
                              y
                            wA




                                                                                       delivering superior
                                     CONSTRUCTION
                       AT H




    MKUjU                         bANKAbLE FEASIbILITy
                    Np




    RIVER                               STUdy


                                                                                       value for our
    pROjECT
                TIO




                                  pRE FEASIbILITy STUdy
               dUC




                                     SCOpINg STUdy
              pRO




                                   MINERAL RESOURCE

                                                                                       stakeholders”

2 Mantra Resources Annual Report 2009
                   Diamond drill rig at Nyota




Mantra Resources Annual Report 2009   3
  Corporate Overview


  The year in review has been highlighted by
  considerable progress in several areas of the
  Company’s activities as it initiates the transition
  from exploration to development.




  Infill drilling and trenching at Nyota
  This progress has been achieved in what is a challenging period
  for mineral resources companies and the Directors are pleased
  to present the fourth annual report to shareholders.

  During the year the Company has focused on its flagship, wholly
  owned Mkuju River Project in southern Tanzania. In August
  2009, the Company moved to 100% ownership of the MRP by
  acquiring the remaining 15% interest in the Mkuju River South
  Joint Venture. The northern half of the MRP, which includes the
  Nyota Prospect, was already 100% wholly owned by Mantra.
  The acquisition is a strategic move which further strengthens
  the Company’s position as the dominant player in this emerging
  uranium province of Karoo age sediments in southern Tanzania.

  The results of Mantra’s extensive ongoing drilling program have
  confirmed the presence of multiple stacked mineralised horizons   In addition, Mantra recognises that it is fortunate to have a
  at shallow depths at Nyota. Significant mineralisation has been   diverse group of skilled consultants participating in its growth.
  intersected in approximately 80% of the holes drilled to date,    Their continuing contributions and participation engender
  with thicknesses up to 55 metres. A maiden MRE of 35.9 million    considerable confidence in an optimal outcome for the projects
  pounds U3O8 (39.9 million tonnes @ 409ppm, using a 200ppm         and the Company.
  lower cutoff) was completed in February 2009.

  A Scoping Study (or ‘the Study’), which included comprehensive
  metallurgical test work and was based on the current MRE, was
  completed in June 2009. The Study confirmed robust Project
  economics over what is considered to be a base case ten year
  mine life producing 2.5 million pounds U3O8 per annum.

  A PFS has commenced and will look at optimising the process
  flow sheet and refining the capital and operating costs for the
  Project, as a prelude to the commencement of the BFS.

  The Company’s progress achieved during the year owes
  much to the skills, commitment and loyalty of its employees.      Field staff briefing




4 Mantra Resources Annual Report 2009
Tanzanian Projects


Mkuju River Project
The MRP is located in southern Tanzania, some 470km
southwest of Dar es Salaam. It comprises twenty contiguous
tenements (licences, renewals and applications) covering an
area of approximately 3,300km2.The area was first identified
as prospective for uranium during reconnaissance exploration
undertaken between 1978 and 1982 by Uranerzbergbau
GmbH (‘UEB’).

The Project is situated in the southern part of the Selous Basin,
a large intracratonic basin filled with clastic sediments of the
Karoo Supergroup. The geology of the project area consists of
thick sequences of Karoo sediments dominated by sandstones.
Secondary uranium mineralisation has been identified within
both the Mkuju and Mbarangandu Series.

The uranium mineralisation at the Nyota Prospect is observed
to be preferentially hosted within sandstone and gritty/
conglomeratic sandstone horizons capped by finer grained
claystone units. The strongest mineralisation is frequently
observed at or near the contact between the sandstone and
claystone units.




                                                                    Mantra Resources Annual Report 2009   5
   Mkuju River Project


  The Company achieved several significant milestones at the             Key points are summarised as follows:
  MRP during the year. Mantra:
                                                                         •	 The MRE is an initial resource for the Project and the
  •	 Delivered an initial MRE of 39.9 million tonnes averaging              potential exists to substantially increase this resource
     409ppm U3O8 for a contained 35.9 million pounds of U3O8.               base with ongoing work;
     The MRE was based on drilling undertaken on only 10 of              •	 The MRE covers an area of approximately 9km2 which
     the 17 radiometric anomalies identified within the 100km2              represents only a small part of the overall target area
     area of Nyota. The majority of the resource is within 60m              of Nyota;
     of the surface;
                                                                         •	 Mineralisation remains open within the current resource
  •	 Completed a Scoping Study, using the MRE as a basis,                   areas. In addition, numerous other radiometric anomalies
     which included a comprehensive metallurgical test work                 at Nyota, and within the broader Project area, have not yet
     program and revealed strong Project economics;                         been drilled;
  •	 Moved to 100% ownership of entire Project;                          •	 The uranium mineralisation is dominantly sandstone hosted
  •	 Commenced a Pre Feasibility Study;                                     and occurs in multiple stacked, flat lying horizons at shallow
                                                                            depths, with thicknesses up to 55m;
  •	 Completed over 75,000m of Reverse Circulation (‘RC’),
     Aircore, Open Hole and Diamond drilling, comprising                 •	 The majority of the MRE is within 60m of surface; and
     approximately 1,250 holes;                                          •	 Further drilling programs, aimed at expanding the
  •	 Intersected thick zones of sandstone hosted mineralisation             MRE and upgrading the resource classification, are
     (up to 55m thick) at shallow depths;                                   currently underway.
  •	 Intersected significant mineralisation in approximately 80%
     of the holes drilled to date;
  •	 Identified significant radiometrically blind mineralisation
     through drilling; and
  •	 Commenced reconnaissance work on a suite of 33
     additional radiometric anomalies identified within the
     broader MRP area, outside of Nyota (Satellite Targets).

  Nyota Prospect
  Mineral Resource Estimate
  An Inferred Mineral Resource was estimated at 39.9 million
  tonnes averaging 409 ppm U3O8 for a contained 35.9 million
  pounds of U3O8 (or approximately 16,300 tonnes contained U3O8)
  at a lower cut-off grade of 200 ppm U3O8. The MRE covers only
  the areas drilled to date at Nyota and is based on data from the
  40,000m drilling campaign completed by the Company in 2008.

                            Mkuju River Project
                    Inferred Mineral Resource Estimate
    Lower Cut-off        Tonnage           Grade       Contained U308
     (U308 ppm)       (million tonnes)   (U308 ppm)   (million pounds)
        250                29.7            472             30.9
        200                39.9            409             35.9
        150                49.9            362             39.8

  Note: apparent differences may be due to rounding

  The MRE was prepared by independent consultants CSA Global
  Pty Ltd (‘CSA’) and was reported in accordance with the JORC
  Code (2004).




6 Mantra Resources Annual Report 2009
Mkuju River Project


Scoping Study                                                        •	 Greater than 90% recovery in leach;
                                                                     •	 Acid leach is a proven technology and used by most
The Scoping Study was managed by MDM Engineering Limited                uranium processes around the world;
of South Africa (‘MDM’) and completed by a number of industry
recognised consultants engaged by the Company. MDM is a              •	 Rapid leach time with 90% dissolution within <4 hours;
minerals process engineering and project management company          •	 The rapid leach will reduce retention time;
with a 20 year track record of undertaking feasibility studies and   •	 Leach temperature is close to ambient and will not
designing and constructing metallurgical plants and associated          therefore require heating;
infrastructure throughout Africa. During the past two years MDM      •	 Low reagent consumption;
has completed two feasibility studies for uranium projects and is
currently constructing two uranium plants.                           •	 Minimal extraction of impurities; and
                                                                     •	 Reduction of environmental issues with the generation of a
Using the MRE as a basis, the Study confirmed the technical and         stable leach residue.
economic viability of the Project and its capacity to operate with
strong cash margins.

The Study was completed using the following parameters:

•	 Life of mine            minimum 10 years
•	 Average Production 2.5 million pounds U3O8 per annum
•	 Ore Mining Rate         Up to 3.7 million tonnes per annum
•	 Cut off grade           200 ppm U3O8
•	 Recovery                81% including beneficiation
•	 Uranium price           US$60 per pound U3O8
The key considerations in the Study were preferred mining and
processing route, scale, throughput rate, project life, community
and environmental impacts. The minimum life of the Project is
ten years, but has the potential to be significantly increased,
given the number of untested targets within close proximity of       The conceptual flow sheet incorporates the concept of upgrading
the current resource areas. The Study is therefore considered as     (beneficiating) the feed material ahead of its processing. The
a base case scenario.                                                beneficiation is achieved by processing the blended run of mine
                                                                     feed through a scrubber. The feed to the scrubber is up to 3.7
Mining                                                               million tonnes of ore per annum. A scrubber unit simulates the
The mining of both ore and waste is a simple process in shallow      activity of a low energy input mill. As the uranium mineralisation
open pits requiring no drilling and blasting. The stripping ratios   is interstitial and predominantly reports to the finer fraction, the
for the Project are as low as 1:1.3 (ore/waste) with the life of     coarse fraction can be rejected with a 10% loss of uranium at
mine stripping ratio averaging 1:2.4. The average mining cost        this point. The coarse fraction is rejected using a series of
is approximately US$1.35 per tonne mined (ore and waste)             three cyclones.
equating to a total mining cost of US$5.60 per pound
U3O8 produced.                                                       Test work has demonstrated that approximately half of the initial
                                                                     mass of scrubber feed is rejected. This process is termed herein
processing                                                           as ‘scatting’. The scats are discarded to a stockpile after being
                                                                     washed over a screen with fresh water to remove fines. The fine
The process facility is based on a simple acid leach, utilising      fraction of the scrubber feed (P80 -325 microns) containing
proven technology that has been in operation globally for over       90% of the uranium is then processed in the near ambient
40 years. The acid leach process is best suited to the MRP and       temperature acid leach.
further work will be completed to refine the flow sheet which will
ultimately be followed up with pilot plant test work at the BFS      An overall U3O8 recovery of 81% has been applied in the Study.
phase. The key results from the test work completed to date, and     This is calculated by applying a 90% recovery from the scatting
the merits of the leach type are as follows:                         process and a minimum 90% recovery from the remainder of
                                                                     the metallurgical process.




                                                                                                  Mantra Resources Annual Report 2009       7
   Mkuju River Project




  Capital Costs                                                           Infrastructure and Other Capital Cost Summary
                                                                          (+/-30% nominal accuracy)
  Capital costs (determined to a nominal accuracy of +/-30%)
  for the process plant and all other project infrastructure are                          Description                     Cost US$ m
  estimated at US$130.1 and US$66.4 million respectively.
  This includes US$20.0 million which has been estimated for               Plant Infrastructure Cost                           2.1
  a sulphuric acid plant and US$4.0 million for the ‘first fill’ of        Camp Infrastructure Cost                            4.7
  reagents. These costs exclude the capital required for the mining
  fleet, facilities or working capital. The capital cost of the initial    Contractors Preliminary and General                 2.1
  mining fleet and associated facilities is US$26.9 million (+/-           ‘First Fill’ of Reagents and Transport              4.0
  30% nominal accuracy), however it is anticipated that this will
  be leased and therefore does not form part of the Project’s              Sulphuric acid plant                               20.0
  capital expenditure.                                                     Tailings Storage Facility                          10.0
  Summary of Process Plant Costs (+/- 30% nominal accuracy)                Power Supply Cost                                   4.5
                                                                           General and Administration Costs                    5.5
                      Description                     Cost US$ m
    Civils Cost                                           12.4             Construction of New Road to Mine                   10.0
    Steelwork Cost                                        15.0             Sub Total                                          62.9
    Mechanical Cost                                       34.7             Contractors Margin                                  0.7
    Electrical and Instrumentation Cost                     9.3            Contingency                                         2.8
    Piping and Valves Cost                                  6.1            Total Infrastructure                               66.4
    Transport Costs                                         6.1
    Construction Cost                                     13.9            Operating Costs
    EPCM Cost                                             16.2            The total operating cost per pound of U3O8 produced in the initial
                                                                          years will be lower due to an elevated feed grade to the plant. In
    Sub Total                                            113.7
                                                                          the first full year of production, the operating cost is estimated
    Contractors Margin                                      7.9           to be US$23.20 per pound U3O8. Over the current ten year life
    Contingency                                             8.5           of mine the average estimated operating cost is US$26.50 per
                                                                          pound U3O8 for an owner operator mining scenario.
    Total Plant                                          130.1



8 Mantra Resources Annual Report 2009
Mkuju River Project


Summary of LOM Operating Costs                                         •	 Geology - Mantra
(+/- 30% nominal accuracy)                                             •	 Resource Estimation - CSA Global (Perth, Darwin, London)
                                                         US$/lb U3O8   •	 Mining Engineering - CSA Global (Perth, Darwin, London)
                      Description                         produced     •	 Comminution - Orway Mineral Consultants (Perth)
 Mining (owner operator)                                      5.60     •	 Metallurgy and Process Engineering - Hydromet (Perth,
                                                                          South Africa)
 Process Plant and Infrastructure                            18.85
                                                                       •	 Metallurgical Test Work - SGS Minerals Services (Perth)
 General and Administration                                   2.05        and ANSTO (Sydney)
 Total Operating Costs (owner operator mining)               26.50     •	 Environmental - Metago (Perth, South Africa) and MTL
                                                                          Consulting Company (Tanzania)
Scoping Study Summary                                                  •	 Tailings Management - Metago (Perth, South Africa)
The Scoping Study confirmed the technical and economic                 During the PFS phase, the Company will focus on evaluating
viability of the Project and its capacity to operate with strong       opportunities to reduce capital and operating costs, including:
cash margins. The key outcomes of the Study follow:
                                                                       •	 Upgrading the resource classification of portions of
•	 The MRP can support a minimum annual production of 2.5                 the current Inferred MRE to the Indicated category
   million pounds U3O8 for a minimum 10 year mine life;                   and increasing the overall resource base to potentially
                                                                          enable increased volumes of higher grade material to
•	 The operating cost in the first full year of production is
                                                                          be mined earlier;
   US$23.20 per pound, averaging US$26.50 over the initial
   10 years of production;                                             •	 Reviewing the applicability of the Resin-in-Pulp
                                                                          metallurgical process route, which has the potential to
•	 Capital and associated infrastructure costs of
                                                                          significantly reduce both capital and operating costs;
   <US$200 million;
                                                                       •	 Examining the use of reagents, their transport and
•	 The Project is a shallow, open pit mining proposition
                                                                          reclamation to reduce operating costs; and
   utilising simple low cost acid leach extraction
   techniques; and                                                     •	 Reviewing lower cost alternatives for power generation
                                                                          with a view to reducing operating costs.
•	 Using a uranium price of US$60 per pound, the Project
   has the capacity to generate pre-tax cash margins of                Infill and Sterilisation drilling
   approximately US$80 million per annum. This indicates
   that the capital costs for the process plant and associated         The PFS infill and sterilisation drilling program commenced in
   project infrastructure could be paid back within a three year       May 2009 and is being completed with the following objectives:
   period from the commencement of production.
                                                                       •	 Upgrade the resource classification of portions of the
The positive results of the Scoping Study for the Nyota Prospect          current Inferred MRE of 35.9 million pounds U3O8 to
underpins the Company’s strategy of focusing on near-term                 the Indicated category;
production and generating an early cash flow, and further              •	 Allow further assessment of the high grade surface
demonstrates the potential of the MRP to become a significant             mineralisation for its inclusion in future MRE’s;
low cost uranium producing province.
                                                                       •	 Deliver diamond core for the pilot plant metallurgical
                                                                          test work;
Pre Feasibility Study
                                                                       •	 Provide additional geological, geotechnical and
The PFS commenced in late June and is being managed by                    hydrogeological information; and
MDM. The Company has also engaged internationally recognised
                                                                       •	 Test the suitability of locations for tailings storage facilities,
specialist consultants in the fields of comminution, metallurgy,
                                                                          waste dumps and site infrastructure.
mining engineering, resource estimation, and environmental and
tailings management as integral members of the study team.             The infill drilling program is designed to close in the existing
                                                                       offset 100m by 100m drill pattern down to a notional 50m by
The PFS study team includes:                                           50m pattern and comprises a total of approximately 4,000m of
                                                                       diamond core and 22,000m of aircore/open hole drilling. The
•	 Project Managers/Engineering Group - MDM Engineering                sterilisation drilling program will comprise up to 10,000m of
   (South Africa)
                                                                       open hole drilling.




                                                                                                     Mantra Resources Annual Report 2009       9
    Mkuju River Project




10 Mantra Resources Annual Report 2009
Mkuju River Project


                      To date results have been received for 220 aircore/open-hole
                      and 52 diamond holes. Highlights from the initial results include:

                      •	 Confirmed continuity of mineralised zones at Nyota, both in
                         terms of thickness and grade;
                      •	 High grade mineralisation intersected at shallow depths
                         (from surface and typically less than 60m depth), with
                         thicknesses up to 55m; and
                      •	 Peak intercept of 55m @ 1,319ppm eU3O8 represents the
                         best drill intersection recorded at Nyota to date.
                      As at 15 September 2009 a total of 286 aircore/open holes for
                      16,550m and 73 diamond holes for 3,730m have been drilled
                      as part of the resource infill drilling program at Nyota. The data
                      obtained from this program will ultimately form the basis for a
                      revised MRE for the Prospect expected to be completed in the
                      December 2009 quarter.




                                                   Mantra Resources Annual Report 2009     11
    Mkuju River Project


    Exploration Activities                                                completed to date, including three new exposures of surficial
                                                                          uranium mineralisation within an untested target area
    Extension and Exploration drilling                                    immediately to the northeast of the current resource area.
    Recent geological mapping and integration of historical work
    has focused on the generation and ranking of priority target          Satellite Targets – Reconnaissance Program
    areas, proximal to the known areas of mineralisation. Drilling        A high resolution helicopter-borne radiometric survey
    completed in 2008 in the central and eastern portions of the          completed over the entire MRP area in mid 2007 resulted
    priority drill area at Nyota covered only 3km2, but contained         in the identification of 33 uranium anomalies requiring field
    approximately 70% (24.5 million pounds U3O8) of the current           evaluation. These Satellite Targets were the focus of a
    MRE. High priority target areas covering approximately 5km2           helicopter supported reconnaissance program completed
    have been confirmed during field work, along with a further           in mid 2008.
    4km2 of quality, priority targets.

    An extension and exploration drilling program on a nominal
    100m x 100m spacing commenced in June 2009 initially
    focusing on the high priority target areas followed by the priority
    targets. The objectives of the drill program are to:

    •	 Substantially increase the overall inferred resource base
       of the Nyota Prospect;
    •	 Provide continuity between the current resource areas;
    •	 Assist in the overall optimisation of open pits and waste
       dump locations; and
    •	 Facilitate the refinement of the existing geological model         Helicopter supported reconnaissance exploration
       and generation of additional targets.
    As at 15 September 2009 a total of 135 exploration aircore/           The SWC Prospect is the most advanced of the Satellite Targets,
    open holes have been drilled at Nyota for 9,030m. Three drill         where a number of prominent airborne radiometric anomalies
    rigs are currently on site and it is anticipated that these rigs      have been identified by the Company. The largest of which is
    will continue to operate throughout the year with a revised           over 1.6km long and up to 800m wide. The Prospect is 45km
    global MRE anticipated to be completed in the March quarter           to the south of Nyota and is part of the MRP. The auger drilling
    of 2010.                                                              program, completed in late 2008, revealed very encouraging
                                                                          results with the following key points:

                                                                          •	 Select intersections included 8m @ 1,255ppm, 5m
                                                                             @1,152ppm, 5m @ 692ppm, 7m @ 497ppm and 7m
                                                                             @ 447ppm;
                                                                          •	 Twelve of the sixteen (75%) holes were mineralised;
                                                                          •	 Eight of the twelve mineralised holes ended in
                                                                             mineralisation;
                                                                          •	 Five of the mineralised holes were mineralised
                                                                             from surface;
    High grade uranium mineralisation in drill core                       •	 All the mineralisation is shallow – within the top 13m;
                                                                          •	 Mineralisation is up to 8m thick;
    Trenching and Mapping
                                                                          •	 The auger drilling was completed in approximately 2km2
    To date, approximately 170 trenches have been excavated                  of the 6km2 that comprise the SWC Prospect area; and
    in the central and eastern portions of the Nyota Prospect.
                                                                          •	 The geology and mineralisation observed is similar to Nyota.
    The trenching program is being undertaken to allow further
    assessment of the high grade surface mineralisation for its           The geological observations and preliminary interpretation
    inclusion in future MRE’s. Initial assay results are pending.         resulting from the initial field checking of Satellite Targets within
                                                                          the broader MRP area are considered extremely encouraging
    Detailed geological mapping (1:2,500 scale) is currently being        and further field work is planned to be undertaken during the
    undertaken in the northern Prospect area. A number of key             September 2009 quarter.
    geological features have been recognised in the mapping




12 Mantra Resources Annual Report 2009
Mbamba Bay Project




Mbamba Bay Project                                                 shallow auger holes (average depth of 3m) completed on
                                                                   second order radiometric anomalies with better results
The Mbamba Bay Project is located in the south-western             including 2.0m @ 510ppm, 3.7m @ 185ppm, 1.0m @
corner of Tanzania and comprises one licence covering an           660ppm and 2.8m @ 229ppm.
area of 72km2.
                                                                   The results from the two reconnaissance programs have been
A high resolution helicopter-borne radiometric survey completed    used to rank and prioritise the suite of anomalies for initial drill
at the Mbamba Bay Project in 2007 revealed a suite of eight        testing which is planned to be undertaken in late 2009.
priority anomaly clusters within a 12km2 zone of anomalous
uranium channel radiometric response associated with Karoo
age sediments. Follow up reconnaissance programs including
geological mapping, ground radiometrics and trenching
confirmed the presence of sandstone hosted uranium
mineralisation at surface throughout an approximately 4km by
1km, north-northwest trending corridor.

A total of 21 trenches, testing 5 radiometric anomaly clusters
(1S, 2S, 1N, 2N, 2NW), were excavated, mapped and sampled
during the initial field program in 2007. Assay results returned
from continuous channel sampling of the trenches showed
that significant intercepts (>100ppm U3O8) were recorded in
15 of the 21 trenches. Significant results included 1.15m @
1,116ppm, 2.80m @ 742ppm, 2.50m @ 413ppm and 2.40m
@ 409ppm.

A second field work program, focused on extending the area
covered by geological mapping, ground radiometrics and
trenching to include the radiometric anomalies not evaluated
during the initial field campaign, was completed in late 2008.     Trenching at Mbamba Bay Project
Assay results were returned from the 20 trenches and 35




                                                                                                 Mantra Resources Annual Report 2009      13
    Other Projects


    Regional Karoo Targets (Southern Tanzania)                           followed-up select anomalies with ground surveys and trenching
                                                                         during the late 1970’s.
    The Regional Karoo Targets comprise a package of uranium
    exploration tenements (licences, renewals and applications)          A brief field campaign comprising geological mapping, ground
    covering approximately 6,550km2 in southern Tanzania, outside        radiometrics and auger drilling was completed at the Handa
    of the Mkuju River and Mbamba Bay Project areas.                     Project. Approximately 36 line kms of ground radiometric
                                                                         traversings and 35 auger holes were completed. The results
    The JV and wholly owned tenements are located within, or             are pending.
    on the margins of, the Karoo-age basins of southern Tanzania.
    The majority of the tenements occur within geological settings
    dominated by the Karoo age sediments of the Selous or Ruhuhu
                                                                         MOzAMbIqUE ANd MALAwI pROjECTS
    Basins, and are considered to be prospective for sandstone-          During the year, the Company rationalised its projects in
    hosted uranium mineralisation.                                       Mozambique and Malawi as it focused its resources on the
                                                                         MRP in Tanzania. The Company has retained only one project in
    A high resolution helicopter-borne radiometric survey completed      Mozambique and completely withdrawn from Malawi.
    in mid 2007 revealed 16 uranium radiometric anomalies
    within Karoo sandstones. These target areas were the focus           Zambezi Valley Project - Mozambique
    of a helicopter supported reconnaissance and field checking
    program completed in mid 2008. Geological mapping, ground            The Zambezi Valley Project – Mozambique (‘ZVP –
    radiometrics and rock chip sampling was undertaken at 16 sites.      Mozambique’) is approximately 300km due west of Tete in
    The data gathered during the reconnaissance program, although        northwestern Mozambique. The Project covers approximately
    preliminary in nature, is considered very encouraging and            600km2 and comprises four Prospecting Licences. The Company
    highlight the exploration potential of the Regional Karoo Targets.   recognised that mineralisation identified in Zimbabwe had the
                                                                         potential to continue over the border into Mozambique.
    Bahi North and Handa Projects
                                                                         Work during the year has included desktop reviews, soil
    The Bahi North and Handa Projects are located within the Bahi        sampling and mapping and data integration of the airborne
    catchment in central Tanzania, an area considered prospective        radiometrics. An RC drilling program recently commenced aimed
    for palaeochannel associated, calcrete-hosted uranium                at testing approximately 1km of the main target area.
    mineralisation.
                                                                         Given the focus on the MRP, the Company is currently assessing
    Uranium accumulation within the Bahi catchment system has            its options with regard to this project.
    been recognised since 1953 when an intersection of 0.15m
    @ 2,400ppm U3O8 was recorded in a salt exploration program
    drill hole near the centre of the Bahi Swamp. UEB identified a
    number of radiometric anomalies in the Bahi catchment area
    from an interpretation of airborne geophysical data and




14 Mantra Resources Annual Report 2009
Sustainable Development


SUSTAINAbLE dEVELOpMENT                                          With the assistance of an internationally regarded radiation
                                                                 safety management professional, Mantra has developed a
At Mantra we believe the success of our business is              Radiation Management Plan which incorporates procedures
underpinned by a strong commitment to all aspects of             for the management of radiation in uranium exploration and
sustainable development with an integrated approach to           project development. The procedures have been implemented
economic, social and environmental management and effective      for all exploration projects with monitoring and data collection
corporate governance.                                            complying with international standards and measures.

Health and Safety
The Company believes that sound occupational health and
safety management practices are in the best interests of its
employees, its business, its shareholders, and the communities
in which it operates.

Mantra is committed to achieving the highest performance in
occupational health and safety to create and maintain a safe
and healthy environment at the workplace.

The Company seeks to eliminate work-related incidents,
illnesses and injuries by identifying, assessing and
where reasonably practical, eliminating or otherwise
controlling hazards.

Mantra employs a dedicated Health and Safety Officer at the
MRP and is in the process of implementing a comprehensive
Occupational Health and Safety Management System designed
to underpin safety of all employees and the general community.




MRP field crew                                                   Trenching crew with standard PPE




                                                                                              Mantra Resources Annual Report 2009   15
    Sustainable Development




    Water sampling at the MRP




    Environment                                                       •	 consult and communicate openly with host communities,
                                                                         governments and other stakeholders.
    Mantra regards caring for the environment as an integral part
    of its business and is committed to operating in a responsible    In ensuring effective environmental management at the MRP,
    manner which minimises the impact on the environment.             Mantra maintains a team of environmental specialists on site
                                                                      who are responsible for the day to day implementation of the
    The Company seeks to ensure that throughout all phases of         Company’s environmental guidelines and procedures.
    activity personnel and contractors give proper consideration to
    the care of flora, fauna, land, air, water and the community.     The Company has collected a comprehensive suite of
                                                                      baseline environmental and radiological data during the wet
    To fulfil this commitment Mantra will:                            and dry seasons at the MRP and recently commenced an
                                                                      Environmental and Social Impact Assessment (‘ESIA’). The
    •	 comply with applicable environmental laws and regulations;     general objective of the ESIA is to assess potential environmental
    •	 implement and maintain effective environmental                 and socio-economic impacts of the Project in order to develop
       management systems;                                            management plans that will enable the mitigation of adverse
    •	 integrate environmental factors into decision-making           impacts and enhance positive impacts. Once the detailed study
       throughout the mining life-cycle;                              is completed, Mantra will prepare the ESIA report including
    •	 assess the potential environmental effects of its activities   both an Environmental Management Plan and an Environmental
       and manage environmental risk;                                 Monitoring Plan in accordance with the requirements of the
                                                                      Tanzanian Environmental Management Act. This also forms an
    •	 regularly monitor and strive to continually improve its        integral part of the Special Mining Licence application.
       environmental performance;
    •	 rehabilitate the environment affected by Company activities;
    •	 promote environmental awareness among personnel
       and contractors to increase understanding of their roles
       and responsibilities in relation to environmental
       management; and




16 Mantra Resources Annual Report 2009
     Minimal disturbance drilling with small rig




Mantra Resources Annual Report 2009   17
    Sustainable Development




    Meeting with local community groups in the Namtumbo District




    Community Relations                                            The Company currently employs over 40 people at the MRP from
                                                                   the local communities and sources the majority of its supplies
    Mantra seeks to develop and maintain positive, enduring        from local providers. In conjunction with Game Frontiers of
    relationships with its host communities in line with the       Tanzania Limited and Tanganyika Wildlife Safari Limited, Mantra
    Company’s Code of Ethics and Conduct by striving for mutual    has established a Community Development Fund which has
    understanding of each other’s needs and aspirations.           contributed significant financial support to a number of health,
    Commensurate with the level of its activities Mantra commits   education, wildlife conservation and local business development
    to support:                                                    initiatives proposed by the local communities in the district in
                                                                   which the MRP is located.
    •	 ongoing consultation with local communities and
       public authorities;
    •	 open and transparent communication about activities that
       might affect the host community;
    •	 mitigation, management and monitoring plans that meet
       international and local standards;
    •	 local sourcing of supplies, services and labour;
    •	 technology transfer and training to both individuals and
       related institutions; and
    •	 community development programs that can be
       self-sustaining.




                                                                   Donation of solar panels at Mbamba Bay




18 Mantra Resources Annual Report 2009
    Annual Financial Report 2009



Directors’ Report                                                                         20
Auditor’s Independence Declaration                                                        40
Income Statement                                                                          41
Balance Sheet                                                                             42
Cash Flow Statement                                                                       43
Statement of Changes In Equity                                                            44
Notes to and Forming Part of the Financial Statements                                     46
Directors’ Declaration                                                                    92
Independent Auditor’s Report                                                              93




                                                    Mantra Resources Annual Report 2009   19
    Directors’ Report

    The Directors of Mantra Resources Limited present their report on the Consolidated Entity consisting of Mantra
    Resources Limited (“the Company” or “Mantra”) and the entities it controlled at the end of, or during, the year ended
    30 June 2009 (“Consolidated Entity” or “Group”).

    Directors
    The names of directors in office at any time during the financial year or since the end of the financial year are:

       Mr Ian Middlemas              Non-Executive Chairman

       Mr Robert Behets              Joint Managing Director

       Mr Matthew Yates              Joint Managing Director

       Mr Colin Steyn                Non-Executive Director

       Mr Mark Pearce                Non-Executive Director

    Unless otherwise disclosed, Directors held their office from 1 July 2008 until the date of this report.

    Current Directors and Officers
    Mr Ian Middlemas
    Non-Executive Chairman
    Qualifications – B.Com, CA

    Mr Middlemas is a Chartered Accountant, a member of the Financial Services Institute of Australasia, Securities
    Institute of Australia and holds a Bachelor of Commerce degree. He worked for a large international Chartered
    Accounting firm before joining the Normandy Mining Group where he was a senior group executive for approximately
    10 years. He has had extensive corporate and management experience, and is currently a director with a number
    of publicly listed companies in the resources sector.

    Mr Middlemas was appointed a Director of the Company on 30 September 2005. During the three year
    period to the end of the financial year, Mr Middlemas has held directorships in Salinas Energy Limited
    (November 1995 – present), OmegaCorp Ltd (October 2000 – August 2007), Global Petroleum Limited (April
    2007 – present), Syngas Limited (May 2007 – February 2008), Indo Mines Limited (December 2006 – present),
    Xenolith Resources Limited (March 2007 – present), Newport Mining Limited (September 2008 – present), Mavuzi
    Resources Limited (January 2007 – March 2008), Odyssey Energy Limited (September 2005 – present), Pacific
    Energy Limited (June 2006 – present), QED Occtech Limited (July 2001 – present), Sierra Mining Limited (January
    2006 – present), Sovereign Metals Limited (July 2006 – present), Fusion Resources Limited (May 2002 – March
    2009) and Berkeley Resources Ltd (July 2003 – November 2006).

    Mr Robert Behets
    Joint Managing Director
    Qualifications – B.Sc (Hons), FAusIMM, MAIG

    Mr Behets is a geologist with over 20 years experience in the mineral exploration and mining industry in Australia
    and internationally. From 1988 to 2005, he worked for WMC Resources Limited where he held various senior
    management positions, including Manager Geology - Kambalda Nickel Operations, Manager Commercial - St Ives
    Gold Operations, Manager Geology - Pinares Nickel Project (Cuba), Exploration Manager – Brazil, and Group
    Manager Exploration. Mr Behets has a strong combination of technical, commercial and managerial skills and
    extensive experience in regional and mine-site exploration, mineral resource and ore reserve estimation, feasibility
    studies and mine geology for nickel sulphide, nickel laterite, gold and copper-gold-uranium deposits.

    Mr Behets is a Fellow of The Australasian Institute of Mining and Metallurgy and a Member of the Australian
    Institute of Geoscientists. He is also a current member of the Australasian Joint Ore Reserve Committee (JORC).

    During the three year period to the end of the financial year, Mr Behets has not held any other directorships in listed companies.




20 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Current Directors and Officers (Continued)
Mr Matthew Yates
Joint Managing Director
Qualifications – B.Sc. (Hons.), MAIG

Mr Yates is a geologist with over 20 years industry experience, covering most facets of exploration from generative
work to project development. He was the Managing Director of OmegaCorp Limited and was instrumental in the
acquisition of the Mkuju River, Kariba and Mavuzi Uranium Projects. He has worked in Australia and southern, east
and west Africa, Central Asia and the Gulf Region. He managed the exploration teams at Nimary and Buhemba
gold projects in Western Australia and Tanzania respectively. Mr Yates has an applied technical background and
has held senior positions for over fifteen years, including Exploration Manager for Tanganyika Gold Limited.

During the three year period to the end of the financial period, Mr Yates held directorships in Omegacorp Limited
(February 2004 – August 2007), Mavuzi Resources Limited (August 2007 – March 2008) and Fusion Resources
Ltd (May 2002 – August 2005 and May 2007 – February 2009).

Mr Colin Steyn
Non-Executive Director
Qualifications - B.Com, MBA

Mr Steyn has over 30 years experience in the resources sector with particular expertise in the development of
mining operations in southern Africa. Mr Steyn was previously President and CEO of LionOre Mining International
(“LionOre”) from 1999 to 2007. He was one of the original founders of LionOre and was instrumental in the growth
and development of LionOre into a major international mining house. During his time as CEO, LionOre grew from
a market capitalisation of US$100 million to over US$6 billion.

From 1996 to 2000, he was a director of Centachrome, a worldwide metals marketing organisation. For five years
prior to 1996, Mr Steyn was Executive Director in charge of Metallurgical Operations in Zimbabwe for Rio Tinto;
where he started his career in 1979.

During the three year period to the end of the financial period, Mr Steyn held a directorship in LionOre Mining
International Limited (1999 – June 2007).

Mr Mark Pearce
Non-Executive Director
Qualifications – B.Bus, CA, FCIS, F Fin

Mr Pearce is a Chartered Accountant and is currently a director of several listed companies that operate in the
resources sector. He has had considerable experience in the formation and development of listed small cap
resource companies and has worked for several large international Chartered Accounting firms. Mr Pearce is also
a Fellow of the Institute of Chartered Secretaries and a Fellow of the Financial Services Institute of Australasia.

Mr Pearce was appointed a Director of the Company on 30 September 2005. During the three year period to the
end of the financial year, Mr Pearce has held directorships in OmegaCorp Limited (October 2000 – August 2007),
Salinas Energy Limited (February 2002 – July 2006), Newport Mining Limited (September 2008 – present), Fusion
Resources Limited (May 2002 – February 2009), Syngas Limited (May 2007 – January 2008), Xenolith Resources
Limited (March 2007 – present), Mavuzi Resources Limited (January 2007 – March 2008), Odyssey Energy Limited
(September 2005 – present), QED Occtech Limited (November 2004 – present), Sovereign Metals Limited (July
2006 – present) and Sierra Mining Limited (January 2006 – August 2006).




                                                                                   Mantra Resources Annual Report 2009   21
    Directors’ Report (Continued)

    Current Directors and Officers (Continued)
    Mr Luke Watson
    Company Secretary
    Qualifications – B.Bus, CA, ACIS

    Mr Watson is a Chartered Accountant, an Associate Member of the Institute of Chartered Secretaries and holds
    a Bachelor of Business degree. He commenced his career with a large international Chartered Accounting
    firm prior to joining OmegaCorp Limited in November 2005 as Company Secretary, a role he held through to
    September 2007. Mr Watson was also the Company Secretary of Mantra from May 2006 – April 2007.

    Mr Watson was re-appointed Company Secretary of Mantra on 11 March 2008.

    Principal Activities
    The principal activities of the Consolidated Entity consisted of mineral exploration in Africa.

    Employees

                                                                                       2009                   2008
     The number of full time equivalent people employed by the
                                                                                         68                     72
     Consolidated Entity at balance date


    Dividends
    No dividends have been declared, provided for or paid in respect of the financial year ended 30 June 2009 (2008: nil).

    Earnings Per Share
                                                                                      2009                   2008
                                                                                        $                      $
     Basic loss per share                                                            (0.37)                 (0.78)
     Diluted loss per share                                                          (0.37)                 (0.78)


    Corporate Structure
    Mantra Resources Limited is a company limited by shares that is incorporated and domiciled in Australia.
    The Company has prepared a consolidated financial report including the entities it incorporated and controlled
    during the financial year.

    Consolidated Results
                                                                                      2009                   2008
                                                                                        $                      $
     Loss of the Consolidated Entity before income tax expense                     (30,133,817)           (41,521,094)
     Income tax expense                                                                       -                      -
     Net loss attributable to members of Mantra Resources Limited                  (30,133,817)           (41,521,094)




22 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Review of Operations and Activities
The operating loss of the Consolidated Entity for the year ended 30 June 2009 was $30,133,817 (2008: $41,521,094).
This loss is largely attributable to:

(i)    The Consolidated Entity’s accounting policy of expensing exploration and evaluation expenditure incurred by
       the Consolidated Entity, subsequent to the acquisition of the rights to explore, and up to the commencement of
       bankable feasibility studies. During the period, exploration expenditure totalled $21,633,321 (which includes
       non-cash share-based payment expenses of $7,298,721). In addition, an impairment provision totalling
       $7,759,787 was made in respect of capitalised exploration and evaluation expenditure (30 June 2008: Nil)
       (refer Note 9 for further details); and

(ii)   The Consolidated Entity expenses the value (determined using the Binomial option pricing model) of share
       options granted to Directors, employees, consultants and other advisors. The value is measured at grant date
       and recognised over the period during which the option holders become unconditionally entitled to the options.
       During the period, non-cash share-based payment expenses totalled $7,455,687 ($7,298,721 classified as
       exploration expenditure and $156,966 classified as corporate and administration expenditure).

It is noted that the above mentioned numbers, and the financial report, are presented in Australian dollars.

During the financial year, the Consolidated Entity continued the aggressive exploration and ongoing development
of its flagship Mkuju River Project (‘MRP’ or ‘Project’) in southern Tanzania. The following key milestones were
achieved at the MRP:

•	     Inferred Mineral Resource estimate (‘MRE’)
       The data obtained from the 2008 drilling program was used to complete the Company’s initial MRE for the
       wholly owned Nyota Prospect which forms part of the larger Mkuju River Project (‘MRP’).

       As announced on 2 February 2009, the Inferred Mineral Resource has been estimated at 39.9 million tonnes
       averaging 409 ppm U3O8 for a contained 35.9 million pounds of U3O8 (or approximately 16,300 tonnes
       contained U3O8) at a lower cut-off grade of 200 ppm U3O8, with the majority of the MRE within 60 metres
       of surface.

•	     Scoping Study
       The MRE was used as a base case scenario for the Scoping Study completed in June 2009 which confirmed
       the potential technical and economic viability and potential for the Project to generate strong cash margins.

       The key Scoping Study results were as follows:

         -    The MRP can support a minimum annual production of 2.5 million pounds U3O8 for a minimum ten year
              mine life;
         -    The operating cost in the first full year of production is US$23.20 per pound, averaging US$26.50 over
              the initial ten years of production;
         -    Capital and associated infrastructure costs of <US$200 million;
         -    The Project is a shallow, open pit mining proposition utilising simple low cost acid leach extraction
              techniques; and
         -    Using a uranium price of US$60 per pound, the Project has the capacity to generate pre-tax cash
              margins of approximately US$80 million per annum, and indicates that the capital costs for the process
              plant and associated project infrastructure could be paid back within a three year period from the
              commencement of production.

       The Directors believe that the positive results of the Scoping Study for the Nyota Prospect underpins the
       Company’s strategy of focusing on near-term production and generating an early cash flow, and further
       demonstrates the potential of the MRP to become a major part of a significant uranium producing province.

The Consolidated Entity continued its exploration programs at a number of its other uranium projects in southern
and central Tanzania, and Mozambique.




                                                                                     Mantra Resources Annual Report 2009   23
    Directors’ Report (Continued)

    Review of Operations and Activities (Continued)
    Mkuju River Project
    The MRP is located in southern Tanzania, some 470km southwest of Dar es Salaam. Mantra’s work program
    at the MRP is aimed at advancing the exploration and appraisal of the widespread ‘Karoo’ sandstone-hosted
    uranium mineralisation identified within the Project area. Exploration and drilling undertaken to date has confirmed
    the presence of widespread surface uranium mineralisation and multiple stacked mineralised horizons at shallow
    depths at the Nyota Prospect.

    The Consolidated Entity completed a 40,000m drilling program targeting the Nyota Prospect in late 2008. Data
    obtained from the drilling program formed the basis for a maiden MRE, which was completed in early February
    2009. The Inferred Mineral Resource was estimated at 39.9 million tonnes averaging 409 ppm U3O8 for a
    contained 35.9 million pounds of U3O8 (or approximately 16,300 tonnes contained U3O8) at a lower cut-off
    grade of 200 ppm U3O8.

    The MRE was prepared by independent consultants CSA Global Pty Ltd (‘CSA’) and reported in accordance with
    the JORC Code (2004).


                                                   Mkuju River Project
                                   Nyota Prospect – Inferred Mineral Resource Estimate
           Lower Cut-off                     Tonnage                          Grade                      Contained U3O8
            (U3O8 ppm)                   (million tonnes)                   (U3O8 ppm)                  (million pounds)
                 250                            29.7                            472                            30.9
                 200                            39.9                            409                            35.9
                 150                            49.9                            362                            39.8
         Note: Apparent differences may occur due to rounding

    The MRE covers an area of approximately 9km2 which represents only a small part of the overall target area
    of the Nyota Prospect and the potential exists to substantially increase this resource base with ongoing work.
    Mineralisation remains open within the current resource areas. In addition, numerous other radiometric anomalies
    at the Nyota Prospect, and within the broader Project area, have not yet been drilled.

    The MRE was used as a base case scenario for the Scoping Study completed in June 2009 which confirmed
    the potential technical and economic viability and potential for the Project to generate strong cash margins. The
    Scoping Study was managed by MDM Engineering Limited (‘MDM’) of South Africa and completed by a number of
    industry recognised consultants engaged by the Company.

    MDM has been retained as Study Manager for the Pre Feasibility Study (‘PFS’), which commenced during June 2009.
    Four drill rigs are currently operating at the MRP and will remain at site until December 2009. The drilling aims to
    significantly increase the resource base of the Project and lift the resource category of portions of the current MRE.

    Considerable progress is anticipated at the MRP over the coming months with the release of:
    •	 exploration and infill drilling results as they become available;
    •	 results of the extensive trenching program that is currently underway to assess high-grade surface mineralisation;
    •	 a resource upgrade in the fourth quarter of 2009, lifting certain portions of the current MRE to the Indicated category;
    •	 further metallurgical test results;
    •	 the conclusion of the Resin in Pulp (‘RIP’) testwork, scheduled to commence in August 2009, which may reduce
       both operating and capital costs for the MRP;
    •	 PFS results by December 2009;
    •	 the award and commencement of a Bankable Feasibility Study (‘BFS’); and
    •	 a revised MRE for the Project aiming to significantly increase the overall resource base during the first quarter of 2010.




24 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Review of Operations and Activities (Continued)
Regional Exploration - Tanzania
During the financial year, the Consolidated Entity also completed the following exploration activities at its remaining
exploration properties in Tanzania:
•	   Very encouraging trench and auger drill hole results were received from the SWC Prospect. The Prospect
     is 45 kilometres to the south of the Nyota Prospect and is part of the Mkuju River Project. The auger holes
     were drilled as a follow-up to the airborne radiometric anomalism identified by the Company, and as part of a
     helicopter supported field reconnaissance program; and
•	   Reconnaissance exploration programs were completed at the Mbamba Bay and Handa Projects in Tanzania.

Mozambique Projects
The Company continues to target sandstone hosted uranium mineralisation in the middle to upper Karoo sequences,
currently the focus of significant uranium exploration and development by a number of companies including Paladin
Energy Limited’s Kayelekera Uranium Project in Malawi which recently commenced production. Specifically, the
Company has identified priority drill targets at the Zambezi Valley Project (‘ZVP – Mozambique’) for drilling that
commenced in August 2009.

Malawi Projects
During the year the Company elected to withdraw from its Malawi Projects due to insufficient encouragement from
the exploration results obtained. Under the terms of the JV agreements, Mantra transferred its interests in the
exploration properties to its JV partners for no consideration. The Company has now completely withdrawn from
Malawi and no longer holds any interests in exploration properties in that country.

Corporate and Financial Position
Following completion of a $24 million placement to Highland Park and its nominees in 2008 and the exercise
of a significant number of options during 2009, the Company had cash reserves of over $26 million at 30 June
2009. In addition, there are 14.3 million unlisted options outstanding with a weighted average exercise price of
approximately $2.12 each, which if exercised will raise up to $30 million. The Board believes that it has the finances,
management skills, resources and mining development expertise that will enable it to successfully complete the
BFS on the Company’s wholly owned Nyota Prospect, enhancing Mantra’s ability to fulfil its strategic objective of
becoming a significant uranium producer in the near term.

The following material corporate events occurred during the year:
•	   The Company announced that it intends to seek a dual listing on the Toronto Stock Exchange (‘TSX’) later
     this year and has engaged Haywood Securities Inc. to act as the Company’s sponsor. The dual listing on the
     TSX will provide increased liquidity to the Company’s current and future shareholders and provide increased
     access to the larger Canadian and other northern hemisphere capital markets.
•	   The Company raised approximately $6.5 million from the exercise of 28.9 million listed and unlisted options.
     Following the receipt of the option exercise monies, the Company’s cash balance increased to approximately
     $26.1 million at 30 June 2009. A small number (45,227) of outstanding listed but unexercised options
     (ASX Code: MRUO) expired on 30 June 2009.
     The issued share capital of the Company at 30 June 2009 was 108,604,994 shares, together with 14.3 million
     unlisted options with a weighted average exercise price of approximately $2.12 each.




                                                                                      Mantra Resources Annual Report 2009   25
    Directors’ Report (Continued)

    Review of Operations and Activities (Continued)
    Business Strategies and Prospects
    The Consolidated Entity currently has the following business strategies and prospects over the medium to long term:

    (i)     To significantly increase the resource base, lift certain portions of the current MRE to the Indicated category,
            and complete a BFS on the wholly owned Nyota Prospect, part of the larger MRP, enabling the Consolidated
            Entity to become a uranium producer in the near-term and generate an early cash flow.
            The Company has already commenced a Pre Feasibility Study and committed to a large drilling and trenching
            program that started in May and will run through until December 2009. It is anticipated that the BFS will
            commence in late 2009;
    (ii)    Seek to maximise the value of the Consolidated Entity’s portfolio of exploration assets in Africa; and
    (iii)   Continue to identify and evaluate new uranium and other corporate opportunities, which can enhance
            shareholder value.

    Risk Management
    The Board is responsible for the oversight of the Consolidated Entity’s risk management and control framework.
    Responsibility for control and risk management is delegated to the appropriate level of management with the Joint
    Managing Directors having ultimate responsibility to the Board for the risk management and control framework.

    Significant Changes in the State of Affairs
    Other than as disclosed below, there were no significant changes in the state of affairs of the Consolidated Entity
    during the year.

    (i)     On 2 February 2009, the Company completed and announced an initial MRE for the wholly owned Nyota
            Prospect, part of the larger MRP. The Inferred Mineral Resource was estimated at 39.9 million tonnes
            averaging 409 ppm U3O8 for a contained 35.9 million pounds of U3O8 (or approximately 16,300 tonnes
            contained U3O8) at a lower cut-off grade of 200 ppm U3O8. The MRE covers only the areas drilled to date at
            the Nyota Prospect;

    (ii)    On 17 June 2009, the Company announced that the Scoping Study for the Nyota Prospect had confirmed
            the technical and economic viability of the Project and its capacity to operate with strong cash margins.

            Using the current Inferred MRE as a base case scenario, the Project can support a minimum annual production
            of 2.5 million pounds U3O8 for a minimum ten year mine life. The operating cost in the first full year of
            production is US$23.20 per pound, averaging US$26.50 over the initial ten years of production.
            At the uranium price of US$60 per pound used in the Scoping Study, the Project has the capacity to generate
            pre-tax cash margins of approximately US$80 million per annum;




26 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Significant Changes in the State of Affairs (Continued)
(iii)   On 28 November 2008, the Company granted the following options to the Joint Managing Directors as part
        of its remuneration/incentive arrangements after obtaining shareholder approval at the Company’s Annual
        General Meeting:
        -   600,000 unlisted options each at an exercise price of $2.50 each, expiring on 30 June 2010 and vesting
            on 31 December 2008; and
        -   600,000 unlisted options each at an exercise price of $3.50 each, expiring on 30 June 2011 and vesting
            on 30 June 2010, subsequently cancelled in March 2009 (refer item (v) below).

        The options were valued at $196,800 and were subject to the vesting periods noted above. The options have
        been expensed over their vesting periods, as required by the relevant accounting standards;

(iv)    On 30 January 2009, the Company issued 250,000 unlisted options exercisable at $1.20 each, expiring on
        31 December 2010 as consideration in relation to the termination of Denison Mines Corp’s rights under the
        Joint Venture Agreement (including the uranium rights for the Meponda and Mavuzi Projects and the exploration
        rights to the Zambezi Valley Project in Mozambique) and the Strategic Alliance Agreement. The options were
        valued at $62,500 and immediately expensed in accordance with the relevant accounting standards;

(v)     Effective 1 March 2009, the Joint Managing Directors accepted a reduced cash remuneration package
        which resulted in their salaries being reduced from $325,000 (plus 9% superannuation) to $250,000
        (plus 9% superannuation) per annum respectively. In addition, the Joint Managing Directors each agreed to
        the cancellation of 600,000 Incentive Options exercisable at $3.50 each on or before 30 June 2011.

        On approximately the same date, the Board also reduced the salary packages of a number of other employees
        and cancelled 500,000 Unlisted Options exercisable at $3.50 each, expiring on 30 June 2011, and 500,000
        Unlisted Options exercisable at $4.50, expiring 30 September 2011;

(vi)    On 12 March 2009, the Company granted the following options to employees and consultants of the Company
        as part of its remuneration/incentive arrangements:

        -   850,000 unlisted options at an exercise price of $1.65 each, expiring on 31 December 2010 and vesting
            on 31 March 2010; and
        -   850,000 unlisted options at an exercise price of $2.50 each, expiring on 30 June 2010.
        The options were valued at $994,500 and were subject to the vesting periods noted above. The options have
        been expensed over their vesting periods, as required by the relevant accounting standards;

(vii)   On 29 April 2009, the Company granted to the Joint Managing Directors 600,000 unlisted options each at an
        exercise price of $1.65 each, expiring on 31 December 2010 and vesting on 31 March 2010, as part of its
        remuneration/incentive arrangements after obtaining shareholder approval at a General Meeting.

        The options were valued at $1,860,000 and were subject to a vesting period of 12 months. The options have
        been expensed over their vesting periods, as required by the relevant accounting standards;




                                                                                     Mantra Resources Annual Report 2009   27
    Directors’ Report (Continued)

    Significant Changes in the State of Affairs (Continued)
    (viii) On 30 June 2009, the Company granted the following options to employees of the Company as part of its
           remuneration/incentive arrangements:

            -    300,000 unlisted options at an exercise price of $3.00 each, expiring on 31 December 2010 and vesting
                 on 31 December 2009; and
            -    300,000 unlisted options at an exercise price of $3.50 each, expiring on 30 June 2011 and vesting on
                 30 June 2010.
             The options, valued at $1,107,000, were granted at the end of the financial year and are subject to vesting
             periods of between 6 and 12 months. The options will be expensed over their vesting periods, as required by
             the relevant accounting standards; and

    (ix)     During the June quarter the Company raised approximately $6.3 million from the exercise of 28.2 million
             listed and unlisted options, allowing the Company to increase its cash balance to approximately $26.1 million
             at 30 June 2009. A small number of outstanding listed but unexercised options (ASX Code: MRUO) expired
             on 30 June 2009. The number of options that remained unexercised and therefore expired was 45,227.

    Significant Post Balance Date Events
    •	     On 24 July 2009, the Company entered into an Agreement to divest its non-core Projects in Mozambique
           (Niassa, Mavuzi, Mucumbura, Murrupula and Zumbu Projects) to North River Resources Plc (‘NRR’), a
           company listed on London’s AIM Market. Consideration for the properties was US $100,000, plus 10 million
           shares in NRR. The issue of the shares to Mantra was approved by NRR’s shareholders at a General Meeting
           held in late August 2009.

    •	     On 18 August 2009, the Company announced that it had moved to 100% ownership of the entire MRP by
           acquiring the remaining 15% interest in the Mkuju River South Joint Venture. The Property is approximately
           1,800km2, comprises ten tenement areas, and covers the southern portion of the Company’s flagship MRP in
           southern Tanzania.

           It is noted that the northern half of the MRP, which includes the Nyota Prospect that hosts an initial Inferred
           Mineral Resource estimate of 35.9 million pounds U3O8 (39.9 million tonnes at 409 ppm, using a 200 ppm lower
           cut-off grade), was already 100% wholly owned by Mantra.

           The acquisition price of the remaining 15% interest in the Property was 200,000 fully paid ordinary shares in Mantra.

    Other than as disclosed above, there were no significant events occurring after balance date requiring disclosure.

    Environmental Regulation and Performance
    The Consolidated Entity’s operations are subject to various environmental laws and regulations under the relevant
    government’s legislation. Full compliance with these laws and regulations is regarded as a minimum standard for
    all operations to achieve.

    Instances of environmental non-compliance by an operation are identified either by external compliance audits or
    inspections by relevant government authorities.

    There have been no significant known breaches by the Consolidated Entity during the financial year.




28 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Likely Developments and Expected Results
As previously announced, the Company intends to seek a dual listing on the TSX later this year. During the June
quarter the Company continued with its planning and preparations for the intended TSX listing and expects to lodge
its application documentation with the TSX during the September quarter. Further information and timing in relation
to the proposed TSX listing will be provided in due course.

It is the Board’s current intention that the Consolidated Entity will focus on its wholly owned MRP in southern
Tanzania. Specifically, in the coming year the Company intends to:
•	   complete the extensive drilling program which is already well advanced, in order to:
     - significantly increase the overall resource base; and
     - upgrade the resource classification of portions of the current Inferred MRE to the Indicated category;
•	   release further metallurgical test results;
•	   complete the Resin in Pulp (‘RIP’) testwork, that commenced in August 2009, which aims to reduce both
     operating and capital costs for the MRP;
•	   announce the Pre Feasibility Study results by December 2009; and
•	   commence the Bankable Feasibility Study, which is expected to be completed during 2010.

The successful completion of these activities will assist the Company to achieve its strategic objective of becoming
a significant uranium producer in the short to medium term.

The Company will also continue to identify and evaluate both uranium and other resource opportunities, including
potential acquisitions, joint ventures, or investments in the resources sector, which can enhance Shareholder value.

All of these activities are inherently risky and the Board is unable to provide certainty that any or all of these
activities will be able to be achieved. In the opinion of the Directors, any further disclosure of information regarding
likely developments in the operations of the Consolidated Entity and the expected results of these operations in
subsequent financial years may prejudice the interests of the Company and accordingly, further information has
not been disclosed.

Information on Directors’ Interests in Securities of Mantra
                                                           Interest in Securities at the Date of this Report
                                                                Shares(1)                    Unlisted Options(3)
 Ian Middlemas                                                  1,640,000                                  -
 Robert Behets                                                  1,169,415                       1,700,000
 Matthew Yates                                                  1,949,165                       1,200,000
 Colin Steyn   (4)
                                                               16,038,982                       4,905,243
 Mark Pearce                                                     153,625                                   -

                                                       Interest in Securities Issued/Granted During the Year
                                                                 Shares(1) & (2)             Unlisted Options(3)
 Ian Middlemas                                                     520,000                                     -
 Robert Behets                                                   1,084,916                        1,800,000
 Matthew Yates                                                   1,955,833                        1,800,000
 Colin Steyn                                                       625,000                                     -
 Mark Pearce                                                         43,628                                    -




                                                                                       Mantra Resources Annual Report 2009   29
    Directors’ Report (Continued)

    Information on Directors’ Interests in Securities of Mantra (Continued)
    Notes
    (1)      “Shares” means fully paid ordinary shares in the capital of the Company.
    (2)      All shares issued during the year were acquired from the exercise of listed and unlisted options which were due to expire
             on 30 June 2009 (refer Note 16 for further details).
    (3)      “Unlisted Options” means:
            (i)      Robert Behets:
                    - 500,000 $0.35 incentive options exercisable on or before 30 June 2010;
                    - 600,000 $1.65 incentive options exercisable on or before 31 December 2010;
                    - 600,000 $2.50 incentive options exercisable on or before 30 June 2010; and
                    - 600,000 $3.50 incentive options exercisable on or before 30 June 2011 (note – cancelled in March 2009).
            (ii)     Matthew Yates:
                    - 600,000 $1.65 incentive options exercisable on or before 31 December 2010;
                    - 600,000 $2.50 incentive options exercisable on or before 30 June 2010; and
                    - 600,000 $3.50 incentive options exercisable on or before 30 June 2011 (note – cancelled in March 2009).
            (iii)    Colin Steyn:
                    - 4,905,243 $2.20 options exercisable on or before 30 June 2011.
    (4)     Mr Steyn has an indirect substantial beneficial interest in these shares and unlisted options. The securities are held in the
            name of Highland Park S.A. and were issued pursuant to a share placement completed in April 2008 which was approved
            by shareholders at a General Meeting. During the year, Highland Park acquired 2,333,333 shares and 625,000 listed
            options from Denison Mines Corp.

    Share Options
    At the date of this report the following unlisted options have been issued over unissued shares:
    •	   650,000 unlisted options at an exercise price of $0.35 each that expire on 30 June 2010;
    •	   350,000 unlisted options at an exercise price of $0.90 each that expire on 31 December 2009;
    •	   600,000 unlisted options at an exercise price of $1.20 each that expire on 31 December 2010;
    •	   2,050,000 unlisted options at an exercise price of $1.65 each that expire on 31 December 2010;
    •	   6,000,000 unlisted options at an exercise price of $2.20 each that expire on 30 June 2011;
    •	   3,350,000 unlisted options at an exercise price of $2.50 each that expire on 30 June 2010;
    •	   800,000 unlisted options at an exercise price of $3.00 each that expire on 31 December 2010; and
    •	   500,000 unlisted options at an exercise price of $3.50 each that expire on 30 June 2011.
    Since 30 June 2009, no shares have been issued as a result of the exercise of options.

    Meetings of Directors
    The following table sets out the number of meetings of the Company’s directors held during the year ended
    30 June 2009, and the number of meetings attended by each director.

                                                             Board Meetings
                                                             Number Eligible                   Board Meetings
     Current Directors                                         to Attend                      Number Attended
     Ian Middlemas                                                    6                                 6
     Robert Behets                                                    6                                 5
     Matthew Yates                                                    6                                 6
     Colin Steyn                                                      6                                 6
     Mark Pearce                                                      6                                 6




30 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Remuneration Report (Audited)
This report details the amount and nature of remuneration of each Key Management Personnel of the Group. Other
than the Directors, Company Secretary, and the Company’s Country Manager in Tanzania, there were no executive
officers of the Group during the year.

Remuneration Policy
Executive Remuneration
The remuneration policy for its Key Management Personnel is to provide a fixed remuneration component, a cash
at risk component (bonus) and a specific equity related component. The Board believes that this remuneration
policy is appropriate given the stage of development of the Company and the activities which it undertakes and is
appropriate in aligning director objectives with shareholder and business objectives.

The remuneration policy in regard to setting the terms and conditions for the executive directors has been developed
by the Board taking into account market conditions and comparable salary levels for companies of a similar size
and operating in similar sectors.

The Company is a medium sized listed company, which is focussed on advancing the potential development of the
Nyota Prospect, part of the larger MRP in southern Tanzania. During the year the Company completed an initial
Mineral Resource estimate for the wholly owned Nyota Prospects and completed a Scoping Study which confirmed
the technical and economic viability of the Project and its capacity to operate with strong cash margins. The Company
intends to commence a BFS in the second half of 2009. The Board considers that the experience of Messers Behets
and Yates in the resources industry will greatly assist the Company in progressing the MRP through the BFS and
development stages. As such, the Board believes that the number of options granted to Messers Behets and Yates
is commensurate to their value to the Company. Similarly, the Board believes that the number of options granted to
Messers Devlin and Watson is commensurate to their value to the Company. Other than the vesting conditions of
each class of options, there are no additional performance criteria on the options as:

(i)   the Incentive Options granted to Messers Behets and Yates during the year had exercise prices equal to, or
      greater than, the price of the Company’s shares on the date of grant; and

(ii) given the speculative nature of the Company’s activities and the small executive team responsible for its
     running, it is considered the performance of Messers Behets and Yates and the performance and value of the
     Company are closely related. As such, the options granted will generally only be of benefit if Messers Behets
     and Yates perform to the level whereby the value of the Company increases sufficiently to warrant exercising
     the options granted.

It is noted that Mr Yates received the following unlisted options during the prior year:
•	     125,000 unlisted options at an exercise price of $0.20 each that expire on 29 June 2009; and
•	     250,000 unlisted options at an exercise price of $0.30 each that expire on 30 June 2010.
These unlisted options were “replacement options” granted following the completion of the merger with Mavuzi in
March 2008 pursuant to a private treaty between Mantra and Mr Yates. In accordance with the relevant accounting
standards, the replacement options were not expensed on the basis that the original Mavuzi options had already
been expensed by Mavuzi and the replacement options did not have any incremental fair value.

Directors receive a superannuation contribution, which is currently 9% and do not receive any other retirement benefits.
Some individuals, however, have chosen to sacrifice part of their salary to increase payments towards superannuation.

All remuneration paid to directors is valued at cost to the Company and expensed. Options are valued using the
Binomial methodology. In accordance with current accounting policy the fair value of options granted as remuneration
is recognised as an expense with a corresponding increase in equity. The fair value is measured at grant date and
recognised over the period during which the directors become unconditionally entitled to the options.




                                                                                       Mantra Resources Annual Report 2009   31
    Directors’ Report (Continued)

    Remuneration Report (Audited) (Continued)
    Non-Executive Director Remuneration
    The Board policy is to remunerate non-executive directors at market rates for comparable companies for time,
    commitment and responsibilities. The Board determines payments to the non-executive directors and reviews their
    remuneration annually, based on market practice, duties and accountability. Independent external advice is sought
    when required. The maximum aggregate amount of fees that can be paid to non-executive directors is subject to
    approval by shareholders at a General Meeting. Fees for non-executive directors are not linked to the performance
    of the Consolidated Entity. However, to align Directors’ interests with shareholder interests, the Directors are
    encouraged to hold shares in the company and have in limited circumstances received options. The Company’s
    non-executive Directors’ did not receive any options as remuneration during the year ended 30 June 2009.

    Impact of Earnings on Key Management Personnel Remuneration
    The Company is currently undertaking exploration and project evaluation activities and does not expect to be
    undertaking profitable operations until after the successful commercialisation, production and sale of commodities
    from one or more of its projects. Accordingly, the Board does not consider current or prior year earnings when
    assessing remuneration of Key Management Personnel.

    As a result of the Company’s exploration and business development activities, the Board anticipates that it
    will retain future earnings (if any) and other cash resources for the operation and development of its business.
    Accordingly, the Company does not currently have a policy with respect to the payment of dividends and as a result
    the remuneration policy does not take into account the level of dividends or other distributions to shareholders
    (e.g. return of capital).

    Impact of Shareholder Wealth on Key Management Personnel Remuneration
    The Board does not directly base remuneration levels on the Company’s share price or movement in the share
    price over time. However, as noted above, a number of Key Management Personnel have received incentive
    options which will generally only be of benefit if the Key Management Personnel perform to the level whereby the
    share price of the Company increases sufficiently to warrant exercising the options granted.

    Group Performance
    The table below sets out summary information about the Consolidated Entity’s earnings and movements in
    shareholder wealth for the period from incorporation (30 September 2005) to 30 June 2009:

                                                                                               Year Ended
                                                   Year Ended            Year Ended           30 June 2007          Period Ended
                                                  30 June 2009          30 June 2008                (1) & (2)
                                                                                                                    30 June 2006
                                                        $                     $                        $                  $
     Revenue                                        1,551,777               1,525,885             409,277                       -
     Loss before tax                              (30,133,817)           (41,521,094)          (2,670,648)               (413,013)
     Loss after tax                               (30,133,817)           (41,521,094)          (2,670,648)               (413,013)
     Dividends                                                 -                      -                         -               -
     Share price at start of year                         3.81                   1.05                   0.20        Not applicable
     Share price at end of year                           3.77                   3.81                   1.05        Not applicable
     Market capitalisation at end of
     year (undiluted)                            409,440,827            303,590,375            46,304,144           Not applicable
     Basic loss per share                                 (0.37)                 (0.78)              (0.10)              (206,507)
     Diluted loss per share                               (0.37)                 (0.78)              (0.10)              (206,507)

    Notes:
    (1) The share price at the start of the 30 June 2007 year refers to the issue price on the initial public offering date.
    (2) The Company listed on the ASX on 9 October 2006. Share price information before this time is not available.




32 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Remuneration Report (Audited) (Continued)
Key Management Personnel Remuneration
Details of the nature and amount of each element of the remuneration of each Director and executive of the
Company or Group for the financial year are as follows:

                        Short-Term
                         Benefits
                                                                                                           Percentage
                                                           Share-                                            of Total
                                            Post                              Other
                                           Employ-         Based              Non-                        Remuneration          Percentage
                     Salary      Cash       ment          Payments            Cash                        that Consists        Performance
                     & Fees      Bonus     Benefits          (1) & (5)
                                                                             Benefits       Total           of Options           Related
 2009                   $          $          $                 $               $             $                 %                   %
 Directors
 Ian Middlemas        50,000        -               -                    -      -            50,000                    -                -
 Robert Behets       300,000        -         27,000         272,258            -           599,258               45.50%                -
 Matthew Yates       300,000        -         27,000         272,258            -           599,258               45.50%                -
 Colin Steyn          40,000        -               -                    -      -            40,000                    -                -
 Mark Pearce          15,000        -               -                    -      -            15,000                    -                -
 Executives
 Luke Watson         150,000        -         13,500         156,966            -           320,466               48.98%                -
 Tony Devlin   (6)
                     490,309        -         49,031       3,442,490            -         3,981,830               86.50%                -

Notes
(1) Share-based payments includes the accounting valuation of all options granted and cancelled during the year. The value of
    each Key Management Personnel’s share-based payments has been calculated as follows:


                                                 Share-Based Payments During the Year

                       Value of Options                                         Value of Options
                         Granted and             Value of Options                Granted in Prior           Total Share-Based
                       Cancelled During         Granted During the              Years and Vested             Payments for the
                           the Year                    Year                      at 30 June 2009                   Year
 2009                          $                        $                                $                          $
 Directors

 Robert Behets                 59,400                    212,858                              -                      272,258

 Matthew Yates                 59,400                    212,858                              -                      272,258

 Executives
 Luke Watson                         -                            -                     156,966                      156,966

 Tony Devlin(6)            2,066,000                    1,376,490                             -                    3,442,490

(2) The value of options granted during the period is recognised in compensation over the vesting period of the grant, in
    accordance with Australian accounting standards.
(3) Other than the Directors, Company Secretary, and Country Manager – Tanzania, there were no executives of the Company
    or Group during the year.
(4) Details of incentive options granted as remuneration to each Key Management Personnel of the Company or Group during
    the financial year are outlined in a separate section below.




                                                                                                  Mantra Resources Annual Report 2009       33
    Directors’ Report (Continued)

    Remuneration Report (Audited) (Continued)
    Key Management Personnel Remuneration (Continued)
    (5) The following incentive options were granted to Directors and executives of the Company or Group during the year, and
        were then subsequently cancelled after each of the individuals agreed to receive a restructured remuneration package,
        including a reduced cash remuneration package:
             •	   Robert Behets and Matthew Yates:
                  - 600,000 $3.50 unlisted options expiring 30 June 2011
             •	   Tony Devlin:
                  - 500,000 $3.50 unlisted options expiring 30 June 2011; and
                  - 500,000 $4.50 unlisted options expiring 30 September 2011.
    (6) Tony Devlin commenced as Country Manager of Mantra Tanzania Limited on 1 September 2008. Mr Devlin is based permanently
        in Tanzania and his salary is paid in US dollars and includes all applicable Tanzanian taxes. Mr Devlin’s salary has been
        converted to Australian dollars using the average exchange rate for the year (~USD1.00:AUD0.75). His cash remuneration
        package includes a remote area allowance and is commensurate with the skills and experience he brings to the Group.
    (7) There were no incentive options granted to Directors as remuneration in prior years that lapsed during the year ended
        30 June 2009.

                           Short-Term
                            Benefits
                                                                                                       Percentage
                                                             Share-                                      of Total
                                                Post                         Other
                                               Employ-       Based           Non-                     Remuneration       Percentage
                        Salary       Cash       ment        Payments         Cash                     that Consists     Performance
                        & Fees       Bonus     Benefits         (1) & (5)
                                                                            Benefits      Total         of Options        Related
     2008                  $           $          $                $           $            $               %                %
     Directors
     Ian Middlemas       36,000            -          -                -         -        36,000             -                  -
     Robert Behets      240,000      50,000     26,100                 -         -       316,100             -            15.82%
     Matthew Yates       75,000            -     6,750                 -         -        81,750             -                 -
     Colin Steyn                 -         -          -                -         -                -          -                 -
     Mark Pearce         15,000            -          -                -         -        15,000             -                 -
     Executives
     Luke Watson(3)      32,500            -     2,925         1,734             -        37,159         4.67%                 -

    Notes
    (1) Other than the Directors and Company Secretary, there were no Executives of the Company or Group during the year.
    (2) There were no unlisted options granted to Directors as remuneration during the year ended 30 June 2008. Further, there
        were no options that were exercised by Directors or that lapsed during the year.
    (3) Luke Watson was appointed Company Secretary of the Company on 11 March 2008.




34 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Remuneration Report (Audited) (Continued)
Options Granted to Key Management Personnel
Details of options recorded as remuneration to each Key Management Personnel of the Company or Group during
the financial year are as follows:

                                                                                         Grant                          No.
                                                                                         Date                      Vested at
                                                  Grant         Expiry      Exercise      Fair         No.          30 June
                         Issuing Entity           Date           Date        Price       Value       Granted           2009
                                                                               $           $
 2009
 Directors
 Robert Behets       Mantra Resources Ltd        28-11-08      30-06-10         2.50     0.065       600,000         600,000
                     Mantra Resources Ltd        28-11-08      30-06-11         3.50     0.099       600,000       cancelled
                     Mantra Resources Ltd        29-04-09      31-12-10         1.65     1.550       600,000                  -
 Matthew Yates       Mantra Resources Ltd        28-11-08      30-06-10         2.50     0.065       600,000         600,000
                     Mantra Resources Ltd        28-11-08      30-06-11         3.50     0.099       600,000       cancelled
                     Mantra Resources Ltd        29-04-09      31-12-10         1.65     1.550       600,000                  -
 Executives
 Tony Devlin         Mantra Resources Ltd        27-06-08      31-12-10         3.00     2.111       500,000         500,000
                     Mantra Resources Ltd        27-06-08      30-06-11         3.50     2.131       500,000       cancelled
                     Mantra Resources Ltd        27-06-08      30-09-11         4.50     2.001       500,000       cancelled
                     Mantra Resources Ltd        12-03-09      31-12-10         1.65     0.740       500,000                  -
                     Mantra Resources Ltd        12-03-09      30-06-10         2.50     0.430       500,000         500,000
 2008
 Executives
 Luke Watson         Mantra Resources Ltd        27-06-08      30-06-10         2.50     2.12          75,000         75,000

Notes
(1) Details on the valuation of the options, including models and assumptions used are provided below.
(2) Each option converts into one ordinary share of Mantra Resources Limited on exercise.
(3) No amounts are paid or payable by the recipient on receipt of the option.

The fair value of the equity-settled share options granted is estimated as at the date of grant using the Binomial
option valuation model taking into vaccount the terms and conditions upon which the options were granted.

The following table lists the inputs to the valuation model used for share options (unlisted) granted to Key
Management Personnel during the year ended 30 June 2009:




                                                                                            Mantra Resources Annual Report 2009   35
    Directors’ Report (Continued)

    Remuneration Report (Audited) (Continued)
    Options Granted to Key Management Personnel (Continued)


                                     $1.65             $1.65          $2.50           $2.50      $3.00          $3.50         $3.50
                                    Unlisted          Unlisted       Unlisted        Unlisted   Unlisted       Unlisted      Unlisted
                                    Options           Options        Options         Options    Options        Options       Options
    Exercise price                        $1.65             $1.65       $2.50          $2.50      $3.00          $3.50         $3.50
    Share price on date of grant          $1.66             $2.70       $0.64          $1.66      $3.77          $0.64         $3.77
    Share price at 30 June 2009           $3.77             $3.77       $3.77          $3.77      $3.77          $3.77         $3.77
    Dividend yield                          Nil               Nil         Nil             Nil           Nil         Nil              Nil
    Volatility                               85%              85%          85%            85%           85%         85%              85%
    Risk-free interest rate                2.68%             3.08%       3.35%          2.68%          4.03%      3.35%          4.03%
    Grant date                      12/03/09          29/04/09       28/11/08        12/03/09   30/06/09       28/11/08      30/06/09
    Expiry date                     31/12/10          31/12/10       30/06/10        30/06/10   31/12/10       30/06/11      30/06/11
    Expected life of option (yrs)          1.81              1.67        1.59           1.30           1.50       2.59           2.00
    Fair value at grant date              $0.74             $1.55      $0.065          $0.43      $1.83         $0.099         $1.86
    Number of options granted        850,000 1,200,000 1,200,000                     850,000    300,000 1,200,000            300,000
    Vesting date                    31/03/10          31/03/10       31/12/08        12/03/09   31/12/09       30/06/10      30/06/10
    Vesting period (yrs)                   1.04              0.92         0.5             Nil           0.5         1.5              1.0
    Expensed at                           Yes              Yes           Yes             Yes         Yes           Yes            Yes
    30 June 2009                     (pro-rata)       (pro-rata)                                (pro-rata)                   (pro-rata)

    Options Granted to Directors and Executives
    Details of the value of options granted, exercised or lapsed for each Key Management Personnel of the Company
    or Group during the financial year are as follows:

                                         Value of Options           Value of Options       Value of Options       Value of Options
                                         Granted During                Exercised            Lapsed During            Cancelled
                                             the Year               During the Year            the Year                During
                                              (1)&(2)&(3)                  (4)                    (5)
                                                                                                                      the Year
                                                  $                        $                      $                       $
     2009
     Directors
     Robert Behets                         1,028,400                     60,500                    -                      (59,400)
     Matthew Yates                         1,028,400                             -                 -                      (59,400)
     Executives
     Luke Watson                                        -                24,200                    -                             -
     Tony Devlin                           3,706,500                             -                 -                (2,066,000)
     2008
     Executives
     Luke Watson                             159,000                             -                -                              -




36 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Remuneration Report (Audited) (Continued)
Options Granted to Directors and Executives (Continued)
Notes
(1)     The following incentive options were granted to Directors and executives of the Company or Group during the year as
        part of the Company’s remuneration / incentive arrangements:
          •	   Robert Behets:
               - 600,000 $1.65 unlisted options expiring 31 December 2010, vesting 31 March 2010;
               - 600,000 $2.50 unlisted options expiring 30 June 2010, vested 31 December 2008; and
               - 600,000 $3.50 unlisted options expiring 30 June 2011 (note – cancelled in March 2009, refer #(5) below for
                 further details).
          •	   Matthew Yates:
               - 600,000 $1.65 unlisted options expiring 31 December 2010, vesting 31 March 2010;
               - 600,000 $2.50 unlisted options expiring 30 June 2010, vested 31 December 2008; and
               - 600,000 $3.50 unlisted options expiring 30 June 2011 (note – cancelled in March 2009, refer #(5) below for
                 further details).
          •	   Tony Devlin:
               - 500,000 $1.65 unlisted options expiring 31 December 2010, vesting 31 March 2010;
               - 500,000 $2.50 unlisted options expiring 30 June 2010, vested 31 December 2008;
               - 500,000 $3.00 unlisted options expiring 31 December 2010, vested 28 February 2009;
               - 500,000 $3.50 unlisted options expiring 30 June 2011 (note – cancelled in March 2009, refer #(5) below for
                 further details); and
               - 500,000 $4.50 unlisted options expiring 30 September 2011 (note – cancelled in March 2009, refer #(5) below
                 for further details).

(2)     For details on the valuation of the options, including models and assumptions used, please refer to Note 16 to the
        financial statements.
(3)     The value of options granted during the year is recognised in compensation over the vesting period of the grant, in
        accordance with Australian accounting standards.
(4)     The following incentive options were exercised by Directors and executives during the year:
          •	   Robert Behets:
               - 500,000 $0.20 unlisted options expiring 29 June 2009; and
               - 500,000 $0.25 unlisted options expiring 30 June 2009.
          •	   Matthew Yates:
               - 125,000 $0.20 unlisted options expiring 29 June 2009; and
               - 250,000 $0.30 unlisted options expiring 30 June 2010.
          •	   Luke Watson:
               - 275,000 $0.20 unlisted options expiring 29 June 2009.

(5)     The following incentive options were granted to Directors and executives of the Company or Group during the year, and
        were then subsequently cancelled after each of the individuals agreed to receive restructured remuneration packages:
          •	   Robert Behets:
               - 600,000 $3.50 unlisted options expiring 30 June 2011
          •	   Matthew Yates:
               - 600,000 $3.50 unlisted options expiring 30 June 2011
          •	   Tony Devlin:
               - 500,000 $3.50 unlisted options expiring 30 June 2011; and
               - 500,000 $4.50 unlisted options expiring 30 September 2011.

(6)     The unlisted options issued to Mr Watson on 27 June 2008 vested after six months continuous service. On the basis that
        these options were not granted until late June 2008 and because they did not vest until 31 December 2008, they were
        fully expensed in the current financial period.
(7)     No options were forfeited during the years ended 30 June 2009 and 30 June 2008.




                                                                                            Mantra Resources Annual Report 2009   37
    Directors’ Report (Continued)

    Remuneration Report (Audited) (Continued)
    Employment Contracts with Key Management Personnel
    Mr Robert Behets, Joint Managing Director, has a contract of employment with Mantra Resources Limited.
    The contract specifies the duties and obligations to be fulfilled by the Managing Director. The contract has a rolling
    annual term and may be terminated by either party giving 2 months notice. No amount is payable in the event of
    termination for neglect or incompetence in regard to the performance of duties. Effective 1 March 2009, Mr Behets’
    cash remuneration was reduced and he now receives a fixed remuneration component of $250,000 per annum
    (previously $325,000) plus superannuation (9%). In accordance with his contract, Mr Behets was granted a cash
    bonus of $50,000 for the year ended 30 June 2008 after achieving key performance indicators which were set by
    the Board at the start of the year.

    Mr Matthew Yates, Joint Managing Director, has a contract of employment with Mantra Resources Limited.
    The contract specifies the duties and obligations to be fulfilled by the Joint Managing Director. The contract has
    a rolling annual term and may be terminated by either party giving 2 months notice. No amount is payable in the
    event of termination for neglect or incompetence in regard to the performance of duties. Effective 1 March 2009,
    Mr Yates’ cash remuneration was reduced and he now receives a fixed remuneration component of $250,000 per
    annum (previously $325,000) plus superannuation (9%).

    Mr Tony Devlin, Country Manager - Tanzania, has a contract of employment with Mantra Tanzania Limited.
    The contract specifies the duties and obligations to be fulfilled by the Country Manager - Tanzania. The contract
    has no fixed term and may be terminated by either party giving 2 months notice. No amount is payable in the event
    of termination for neglect or incompetence in regard to the performance of duties. Effective 1 March 2009, Mr
    Devlin’s cash remuneration was reduced and he now receives a fixed remuneration component of US $300,000
    per annum plus pension (10%). In accordance with his contract, Mr Devlin is eligible to receive cash bonuses after
    achieving various key performance indicators. Mr Devlin has not been granted or paid any cash bonuses for the
    year ended 30 June 2009.

    Mr Luke Watson, Company Secretary, has a contract of employment with Mantra Resources Limited. The contract
    specifies the duties and obligations to be fulfilled by the Company Secretary. The contract has no fixed term and
    may be terminated by either party giving 2 months notice. No amount is payable in the event of termination for
    neglect or incompetence in regard to the performance of duties. Since 1 July 2008, Mr Watson has received a fixed
    remuneration component of $150,000 per annum plus superannuation (9%).

    Insurance of Officers and Auditors
    The Constitution of the Company requires the Company, to the extent permitted by law, to indemnify any person who is
    or has been a director or officer of the Company or Group for any liability caused as such a director or officer and any
    legal costs incurred by a director or officer in defending an action for any liability caused as such a director or officer.

    The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify an officer or
    auditor of the Company or of any related body corporate against a liability incurred as such an officer or auditor.

    During the financial year, an annualised insurance premium of $24,351 was paid by the Company to insure directors
    and officers of the Company.

    Non-Audit Services
    There were no non-audit services provided by the auditor (or by another person or firm on the auditor’s behalf)
    during the financial year.




38 Mantra Resources Annual Report 2009
Directors’ Report (Continued)

Auditor’s Independence Declaration
The auditor’s independence declaration is on page 40 of the Financial Report.

This report is made in accordance with a resolution of the directors made pursuant to section 298(2) of the
Corporations Act 2001.

For and on behalf of the Directors




ROBERT BEHETS
Joint Managing Director


14 September 2009




                                                                                Mantra Resources Annual Report 2009   39
     Auditor’s Independence Declaration

                                                                                          Deloitte Touche Tohmatsu
                                                                                          ABN 74 490 121 060
                                                                                          Woodside Plaza
                                                                                          Level 14

                                                                                          240 St Georges Terrace
                                                                                          Perth WA 6000
                                                                                          GPO Box A46
                                                                                          Perth WA 6837 Australia

                                                                                          DX 206
    The Board of Directors                                                                Tel: +61 (0) 8 9365 7000
                                                                                          Fax: +61 (0) 8 9365 7001
    Mantra Resources Ltd
                                                                                          www.deloitte.com.au
    Level 9, BGC Centre
    28 The Esplanade
    Perth WA 6000



    14 September 2009


    Dear Sirs
                                               Mantra Resources Limited

    In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration
    of independence to the directors of Mantra Resources Limited.

    As lead audit partner for the audit of the financial statements of Mantra Resources Limited for the financial year
    ended 30 June 2009 I declare that to the best of my knowledge and belief, there have been no contraventions of:

             (i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
             (ii) any applicable code of professional conduct in relation to the audit.

    Yours sincerely




    DELOITTE TOUCHE TOHMATSU




    A T Richards
    Partner
    Chartered Accountants
    Perth




40 Mantra Resources Annual Report 2009
Income Statement

For the Financial Year Ended 30 June 2009
                                                         Consolidated                          Company
                                           Note         2009            2008              2009              2008
                                                          $               $                 $                 $


Revenue from continuing operations          2        1,551,777       1,525,885         1,537,373            935,655


Corporate and administration costs                  (2,194,993)     (2,768,654)      (2,158,686)        (1,960,101)
Business development costs                             (65,900)      (734,499)           (65,900)         (464,050)
Exploration costs                                 (21,633,321)      (7,587,100)      (8,071,715)        (1,475,544)
Other expenses                             3(a)        (31,593)      (650,697) (13,681,488)             (7,388,176)
Impairment of exploration assets           9(b)     (7,759,787)                -     (2,090,741)                   -
Impairment of goodwill                     11                  -   (31,306,029)                  -                 -
Impairment of investment                   10                  -               -     (5,300,000)      (31,306,029)
Loss before income tax expense                    (30,133,817)     (41,521,094) (29,831,157)          (41,658,245)


Income tax expense                          4                  -               -                 -                 -
Loss after income tax expense                     (30,133,817)     (41,521,094) (29,831,157)          (41,658,245)


Loss attributable to members of
Mantra Resources Limited                          (30,133,817)     (41,521,094) (29,831,157)          (41,658,245)


Basic loss per share (cents per share)     24           (36.86)         (77.64)


Diluted loss per share (cents per share)   24           (36.86)         (77.64)



          Notes to and forming part of the Income Statement are set out on the accompanying pages.




                                                                                   Mantra Resources Annual Report 2009   41
    Balance Sheet

    As at 30 June 2009
                                                                Consolidated                   Company
                                                 Note        2009          2008           2009             2008
                                                               $             $              $                $
    ASSETS
    Current Assets
    Cash and cash equivalents                    25(b)     26,116,132    35,063,679     26,087,461    34,863,973
    Trade and other receivables                    5          498,074       656,197        224,078         439,580
    Other assets                                   6           74,424       235,782               -               -
    Other financial assets                         7          202,362       312,012               -               -
    Total Current Assets                                   26,890,992    36,267,670     26,311,539    35,303,553
    Non-current Assets
    Property, plant and equipment                  8        1,028,729       751,975         10,800           7,648
    Exploration and evaluation assets              9                 -    7,570,148               -       2,090,741
    Other financial assets                        10                 -             -     7,511,305    12,811,305
    Goodwill                                       11                -             -              -               -
    Total Non-current Assets                                1,028,729     8,322,123      7,522,105    14,909,694


    TOTAL ASSETS                                           27,919,721    44,589,793     33,833,644    50,213,247

    LIABILITIES
    Current Liabilities
    Trade and other payables                      12        1,584,838     2,305,005        603,361         670,588
    Provisions                                    13          230,399       110,378        169,915          70,513
    Borrowings                                    14          740,380       740,380      6,837,082        7,292,262
    Total Current Liabilities                               2,555,617     3,155,763      7,610,358        8,033,363


    TOTAL LIABILITIES                                       2,555,617     3,155,763      7,610,358        8,033,363

    NET ASSETS                                             25,364,104    41,434,030     26,223,286    42,179,884


    EQUITY
    Equity attributable to equity
    holders of the Company
    Issued capital                                15       91,163,906    73,424,522     91,163,906    73,424,522
    Reserves                                      16        8,938,770    12,614,263      8,043,737    11,908,562
    Accumulated losses                            17      (74,738,572) (44,604,755)    (72,984,357)   (43,153,200)

    TOTAL EQUITY                                           25,364,104    41,434,030     26,223,286    42,179,884


                  Notes to and forming part of the Balance Sheet are set out on the accompanying pages.




42 Mantra Resources Annual Report 2009
Cash Flow Statement

For the Financial Year Ended 30 June 2009
                                                             Consolidated                   Company
                                                Note         2009          2008           2009             2008
                                                               $             $              $                $


Cash flows from operating activities
Interest received                                         1,844,714     1,158,833      1,829,417        569,496
GST / VAT received                                          114,561      175,686         114,561        106,007
Payments to suppliers and employees                     (16,866,424) (8,316,571)       (3,005,526) (1,905,473)
Net cash outflow from operating activities      25(a)   (14,907,149) (6,982,052)       (1,061,548) (1,229,970)

Cash flows from investing activities
Purchase of property, plant and equipment                  (468,458)    (528,096)          (7,382)        (4,159)
Deposits paid                                                       -   (180,917)                -                -
Purchase of exploration and evaluation assets              (109,349)    (730,338)                -     (550,931)
Loans to controlled entities                                        -             -   (13,678,958) (6,064,760)
Loans to third parties                            7                 -   (312,012)                -                -
Proceeds from repayment of third party loans                102,214               -              -                -
Net cash inflow from acquisition of Mavuzi       21                 -   8,244,655                -                -
Net cash (outflow)/inflow from
investing activities                                       (475,593)    6,493,292     (13,686,340) (6,619,850)


Cash flows from financing activities
Proceeds from borrowings                                            -             -      188,600      7,292,262
Repayment of borrowings                                             -             -     (643,780)                 -
Proceeds from issue of shares                             6,489,480 24,945,755         6,489,480 24,945,755
Transaction costs from issue of shares                      (62,924)     (98,303)         (62,924)       (98,303)
Net cash inflow from financing activities                 6,426,556 24,847,452         5,971,376 32,139,714

Net (decrease)/increase in cash
and cash equivalents held                                (8,956,186) 24,358,692        (8,776,512) 24,289,894
Foreign exchange movement on cash
and cash equivalents                                          8,639      (18,925)                -                -
Cash and cash equivalents at the
beginning of the financial year                          35,063,679 10,723,912        34,863,973 10,574,079


Cash and cash equivalents at the
end of the financial year                       25(b)    26,116,132 35,063,679        26,087,461 34,863,973


         Notes to and forming part of the Cash Flow Statement are set out on the accompanying pages.




                                                                               Mantra Resources Annual Report 2009    43
                                                                                                                                                   Foreign
                                                                                                                                    Option        Currency
                                                                                                                     Issued        Premium       Translation     Accumulated         Total
                                                                                                          Note       Capital       Reserve        Reserve          Losses           Equity
                                                                 Consolidated                                           $             $               $              $                 $
                                         Balance at beginning of period                                             13,179,450       978,650         120,585        (3,083,661)    11,195,024
                                         Foreign currency translation                                                          -            -         585,116                  -      585,116
                                         Total income and expense for the year
                                                                                                                               -            -         585,116                  -      585,116
                                         recognised directly in equity
                                         Net loss for the year                                                                 -            -                -     (41,521,094)    (41,521,094)




44 Mantra Resources Annual Report 2009
                                         Total recognised income and expense for the year                                      -            -         585,116      (41,521,094)    (40,935,978)
                                         Issue of shares                                                            20,919,595              -                -                 -   20,919,595
                                         Exercise of listed options                                                  4,716,159              -                -                 -    4,716,159
                                         Share issue costs                                                              (98,303)            -                -                 -       (98,303)
                                         Share based payments                                                                  -    1,520,200                -                 -    1,520,200
                                                                                                                                                                                                  For the Financial Year Ended 30 June 2009




                                         Mavuzi Scheme Consideration                                                34,707,621      9,409,712                -                 -   44,117,333
                                                                                                                                                                                                                                              Statement of Changes in Equity




                                         Balance at 30 June 2008                                                    73,424,522     11,908,562        705,701       (44,604,755)    41,434,030
                                         Foreign currency translation                                                          -            -        189,332                   -      189,332
                                         Total income and expense for the year
                                                                                                                               -            -        189,332                   -      189,332
                                         recognised directly in equity
                                         Net loss for the year                                                                 -            -                -     (30,133,817)    (30,133,817)
                                         Total recognised income and expense for the year                                      -            -        189,332       (30,133,817)    (29,944,485)
                                         Issue of shares                                                                       -            -                -                 -             -
                                         Exercise of listed options                                                  3,971,979              -                -                 -    3,971,979
                                         Transfer of option premium reserve                                          9,679,712     (9,679,712)               -                 -             -
                                         Exercise of unlisted options                                                2,517,500              -                -                 -    2,517,500
                                         Transfer of option premium reserve                                          1,640,800     (1,640,800)               -                 -             -
                                         Share issue costs                                                             (70,607)             -                -                 -       (70,607)
                                         Share based payments                                                                  -    7,455,687                -                 -    7,455,687
                                         Balance at 30 June 2009                                                    91,163,906      8,043,737        895,033       (74,738,572)    25,364,104

                                                                      Notes to and forming part of the Statement of Changes in Equity are set out on the accompanying pages.
                                                                                                                                     Option
                                                                                                                                    Premium           Accumulated
                                                                                                    Note      Issued Capital        Reserve             Losses              Total Equity
                                                              Company                                               $                  $                  $                       $
                                      Balance at beginning of period                                            13,179,450           978,650            (1,494,955)          12,663,145
                                      Net loss for the year                                                               -                  -        (41,658,245)          (41,658,245)
                                      Total recognised income and expense for the year                                    -                  -        (41,658,245)          (41,658,245)
                                      Issue of shares                                                           20,919,595                   -                   -           20,919,595
                                      Exercise of listed options                                                 4,716,159                   -                   -            4,716,159
                                      Share issue costs                                                             (98,303)                 -                   -              (98,303)
                                      Share based payments                                                                -         1,520,200                    -            1,520,200
                                      Mavuzi Scheme Consideration                                               34,707,621          9,409,712                    -           44,117,333
                                      Balance at 30 June 2008                                                   73,424,522        11,908,562          (43,153,200)           42,179,884
                                      Net loss for the year                                                               -                  -        (29,831,157)          (29,831,157)
                                                                                                                                                                                           For the Financial Year Ended 30 June 2009




                                      Total recognised income and expense for the year                                    -                  -        (29,831,157)          (29,831,157)
                                                                                                                                                                                                                                       Statement of Changes in Equity




                                      Issue of shares                                                                     -                  -                   -                     -
                                      Exercise of listed options                                                 3,971,979                   -                   -            3,971,979
                                      Transfer of option premium reserve                                         9,679,712         (9,679,712)                   -                     -
                                      Exercise of unlisted options                                               2,517,500                   -                   -            2,517,500
                                      Transfer of option premium reserve                                         1,640,800         (1,640,800)                   -                     -
                                      Share issue costs                                                             (70,607)                 -                   -              (70,607)
                                      Share based payments                                                                -         7,455,687                    -            7,455,687
                                      Balance at 30 June 2009                                                   91,163,906          8,043,737         (72,984,357)           26,223,286

                                                                   Notes to and forming part of the Statement of Changes in Equity are set out on the accompanying pages.




Mantra Resources Annual Report 2009
45
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.    Summary of Significant Accounting Policies
    The principal accounting policies adopted in preparing the financial report of the Company, Mantra Resources
    Limited and its consolidated entities (“Consolidated Entity” or “Group”) for the year ended 30 June 2009 are stated
    to assist in a general understanding of the financial report.

    Mantra Resources Limited is a company limited by shares incorporated in Australia whose shares are publicly
    traded on the Australian Stock Exchange.

    The financial report of the Company for the year ended 30 June 2009 was authorised for issue in accordance with
    a resolution of the Directors on 8 September 2009.

    (a) Basis of Preparation
    The financial report is a general purpose financial report which has been prepared in accordance with Australian
    Accounting Standards (“AASBs”) and interpretations adopted by the Australian Accounting Standards Board
    (“AASB”) and the Corporations Act 2001.

    In the application of AASBs management is required to make judgements, estimates and assumptions about
    carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and
    associated assumptions are based on historical experience and various other factors that are believed to be
    reasonable under the circumstance, the results of which form the basis of making the judgements. Actual results
    may differ from these estimates.

    The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
    are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period
    of the revision and future periods if the revision affects both current and future periods.

    Judgements made by management in the application of AASBs that have significant effects on the financial
    statements and estimates with a significant risk of material adjustments in the next year are disclosed, where
    applicable, in the relevant notes to the financial statements.

    Accounting policies are selected and applied in a manner which ensures that the resulting financial information
    satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions
    or other events is reported.

    The financial report has also been prepared on a historical cost basis, except for other financial assets at fair value
    through profit or loss and available-for-sale investments, which have been measured at fair value.

    The financial report is presented in Australian dollars.

    (b) Statement of Compliance
    The financial report complies with Australian Accounting Standards, which include Australian equivalents to International
    Financial Reporting Standards (AIFRS). The financial report, which includes the financial statements and the notes of
    the Company and the Group, also complies with International Financial Reporting Standards (IFRS).

    In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by the
    AASB that are relevant to its operations and effective for the current annual reporting period. Details of the impact of
    the adoption of these new accounting standards are set out in the individual accounting policy notes set out below.




46 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(b)   Statement of Compliance (Continued)
Australian Accounting Standards and Interpretations that have recently been issued or amended but are
not yet effective have not been adopted by the Group for the annual reporting period ended 30 June 2009.
These are outlined in the table below:


                                                                             Application                                  Application
                                                                               Date of         Impact on Group             Date for
 Reference              Title                     Summary                     Standard         Financial Report             Group
 AASB Int. 16   Hedges of a Net         This Interpretation requires         1 October 2008    These amendments           1 July 2009
                Investment in a         that the hedged risk in a                              are not expected to
                Foreign Operation       hedge of a net investment in a                         have any impact on
                                        foreign operation is the foreign                       the Group’s financial
                                        currency risk arising between                          report.
                                        the functional currency of
                                        the net investment and the
                                        functional currency of any
                                        parent entity. This also applies
                                        to foreign operations in the form
                                        of joint ventures, associates or
                                        branches.

 AASB Int. 17   Distributions of        The Interpretation outlines          1 July 2009       These amendments           1 July 2009
 and AASB       Non-cash Assets         how an entity should measure                           are not expected to
 2008-13        to Owners and           distributions of assets, other                         have any impact on
                consequential           than cash, as a dividend to its                        the Group’s financial
                amendments to           owners acting in their capacity                        report.
                Australian Accounting   as owners. This applies to
                Standards AASB 5        transactions commonly referred
                and AASB 110            to as spin-offs, split offs or
                                        demergers and in-specie
                                        distributions.

 AASB Int. 18   Transfers of Assets     This Interpretation provides         Applies           These amendments           1 July 2009
                from Customers          guidance on the transfer             prospectively     are not expected to
                                        of assets such as items              to transfers of   have any impact on
                                        of property, plant and               assets from       the Group’s financial
                                        equipment or transfers of cash       customers         report.
                                        received from customers.             received on
                                        The Interpretation provides          or after 1 July
                                        guidance on when and how an          2009
                                        entity should recognise such
                                        assets and discusses the timing
                                        of revenue recognition for such
                                        arrangements and requires
                                        that once the asset meets the
                                        condition to be recognised at
                                        fair value, it is accounted for as
                                        an ‘exchange transaction’.

 AASB 8 and     Operating Segments      New Standard replacing               1 January 2009    AASB 8 is a disclosure     1 July 2009
 AASB 2007-3    and consequential       AASB114 Segment Reporting,                             standard so will have
                amendments to other     which adopts a management                              no direct impact on the
                Australian Accounting   reporting approach to segment                          amounts included in
                Standards               reporting.                                             the Group’s financial
                                                                                               statements. In addition,
                                                                                               the amendments may
                                                                                               have an impact on
                                                                                               the Group’s segment
                                                                                               disclosures.




                                                                                                    Mantra Resources Annual Report 2009   47
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.    Summary of Significant Accounting Policies (Continued)
    (b)   Statement of Compliance (Continued)

                                                                                 Application                                 Application
                                                                                   Date of        Impact on Group             Date for
     Reference               Title                     Summary                    Standard        Financial Report             Group
     AASB 1039       Concise Reporting        AASB 1039 was revised              1 January 2009   These amendments           1 July 2009
     (revised)                                in August 2008 to achieve                           are not expected to
                                              consistency with AASB 8                             have any impact on
                                              Operating Segments. The                             the Group’s financial
                                              revisions include changes to                        report.
                                              terminology and descriptions
                                              to ensure consistency with the
                                              revised AASB 101 Presentation
                                              of Financial Statements.

     AASB 123        Borrowing Costs          The amendments to AASB 123         1 January 2009   The Group has no           1 July 2009
     (revised) and   and consequential        require that all borrowing costs                    borrowing costs
     AASB 2007-6     amendments to other      associated with a qualifying                        associated with
                     Australian Accounting    asset be capitalised.                               qualifying assets
                     Standards.                                                                   and as such the
                                                                                                  amendments are not
                                                                                                  expected to have any
                                                                                                  impact on the Group’s
                                                                                                  financial report.

     AASB 101        Presentation of          Introduces a statement of          1 January 2009   These amendments           1 July 2009
     (revised),      Financial Statements     comprehensive income.                               are only expected to
     AASB 2007-8     and consequential        Other revisions include impacts                     affect the presentation
     and AASB        amendments to other      on the presentation of items                        of the Group’s financial
     2007-10         Australian Accounting    in the statement of changes                         report and will not
                     Standards                in equity, new presentation                         have a direct impact
                                              requirements for restatements                       on the measurement
                                              or reclassification of items                        and recognition of
                                              in the financial statements,                        amounts disclosed in
                                              changes in the presentation                         the financial report.
                                              requirements for dividends                          The Company has
                                              and changes to the titles of the                    not determined at
                                              financial statements.                               this stage whether
                                                                                                  to present a single
                                                                                                  statement of
                                                                                                  comprehensive income
                                                                                                  or two separate
                                                                                                  statements.

     AASB 2008-1     Amendments to            The amendments clarify             1 January 2009   These amendments           1 July 2009
                     Australian Accounting    the definition of ‘vesting                          are not expected to
                     Standard – Share-        conditions’, introducing the                        have any impact on
                     based payments:          term ‘non-vesting conditions’                       the Group’s financial
                     Vesting Conditions       for conditions other than                           report.
                     and Cancellations        vesting conditions as
                                              specifically defined and
                                              prescribe the accounting
                                              treatment of an award that is
                                              effectively cancelled because
                                              a non-vesting condition is not
                                              satisfied.

     AASB 2008-2     Amendments to            The amendments provide             1 January 2009   These amendments           1 July 2009
                     Australian Accounting    a limited exception to the                          are not expected to
                     Standards – Puttable     definition of a liability so as                     have any impact on
                     Financial Instruments    to allow an entity that issues                      the Group’s financial
                     and Obligations          puttable financial instruments                      report as the Company
                     arising on Liquidation   with certain specified features,                    does not have on issue
                                              to classify those instruments                       or expect to issue
                                              as equity rather than financial                     any puttable financial
                                              liabilities.                                        instruments as defined
                                                                                                  by the amendments.




48 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(b)   Statement of Compliance (Continued)

                                                                        Application                                     Application
                                                                          Date of         Impact on Group                Date for
 Reference             Title                   Summary                   Standard         Financial Report                Group
 AASB 3        Business                The revised Standard             1 July 2009      These amendments are           1 July 2009
 (revised)     Combinations            introduces a number of                            not expected to have any
                                       changes to the accounting                         impact on the Group’s
                                       for business combinations,                        financial report.
                                       the most significant of which
                                       includes the requirement
                                       to expense transaction
                                       costs and a choice (for
                                       each business combination
                                       entered into) to measure
                                       a non-controlling interest
                                       (formerly a minority interest)
                                       in the acquiree either
                                       at its fair value or at its
                                       proportionate interest in
                                       the acquiree’s net assets.
                                       This choice will effectively
                                       result in recognising
                                       goodwill relating to 100%
                                       of the business (applying
                                       the fair value option) or
                                       recognising goodwill relating
                                       to the percentage interest
                                       acquired. The changes
                                       apply prospectively.

 AASB 127      Consolidated and        There are a number of            1 July 2009      If the Group changes           1 July 2009
 (revised)     Separate Financial      changes arising from the                          its ownership interest in
               Statements              revision to AASB 127                              existing subsidiaries in the
                                       relating to changes in                            future, the change will be
                                       ownership interest in a                           accounted for as an equity
                                       subsidiary without loss                           transaction. This will have
                                       of control, allocation of                         no impact on goodwill, nor
                                       losses of a subsidiary and                        will it give rise to a gain
                                       accounting for the loss                           or a loss in the Group’s
                                       of control of a subsidiary.                       income statement.
                                       Specifically in relation to a
                                       change in the ownership
                                       interest of a subsidiary (that
                                       does not result in loss of
                                       control) – such a transaction
                                       will be accounted for as an
                                       equity transaction.

 AASB 2008-3   Amendments to           Amending standard issued         1 July 2009      Refer to AASB 3 (revised)      1 July 2009
               Australian Accounting   as a consequence of                               and AASB 127 (revised)
               Standards arising       revisions to AASB 3 and                           above.
               from AASB 3 and         AASB 127. Refer above.
               AASB 127

 AASB 2008-5   Amendments to           The improvements project         1 January 2009   These amendments are           1 July 2009
               Australian Accounting   is an annual project that                         not expected to have any
               Standards arising       provides a mechanism for                          impact on the Group’s
               from the Annual         making non-urgent, but                            financial report.
               Improvements Project    necessary, amendments to
                                       IFRSs.




                                                                                                 Mantra Resources Annual Report 2009   49
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.    Summary of Significant Accounting Policies (Continued)
    (b)   Statement of Compliance (Continued)

                                                                             Application                                 Application
                                                                               Date of         Impact on Group            Date for
     Reference              Title                   Summary                   Standard         Financial Report            Group
     AASB 2008-6    Further Amendments      This was the second              1 July 2009      These amendments are       1 July 2009
                    to Australian           omnibus of amendments                             not expected to have any
                    Accounting Standards    issued by the IASB                                impact on the Group’s
                    arising from the        arising from the Annual                           financial report.
                    Annual Improvements     Improvements Project.
                    Project                 Refer to AASB 2008-5
                                            above for more details.

     AASB 2008-7    Amendments to           The main amendments              1 January 2009   These amendments are       1 July 2009
                    Australian Accounting   of relevance to Australian                        not expected to have any
                    Standards – Cost of     entities are those made to                        impact on the Group’s
                    an Investment in a      AASB 127 deleting the “cost                       financial report.
                    Subsidiary, Jointly     method” and requiring all
                    Controlled Entity or    dividends from a subsidiary,
                    Associate               jointly controlled entity or
                                            associate to be recognised
                                            in profit or loss in an
                                            entity’s separate financial
                                            statements (i.e., parent
                                            company accounts). The
                                            distinction between pre- and
                                            post-acquisition profits is no
                                            longer required. However,
                                            the payment of such
                                            dividends requires the entity
                                            to consider whether there
                                            is an indicator of impairment.
                                            AASB 127 has also been
                                            amended to effectively allow
                                            the cost of an investment
                                            in a subsidiary, in limited
                                            reorganisations, to be based
                                            on the previous carrying
                                            amount of the subsidiary
                                            (that is, share of equity)
                                            rather than its fair value.

     AASB 2008-8    Amendments to           The amendment to                 1 July 2009      These amendments are       1 July 2009
                    Australian Accounting   AASB 139 clarifies how                            not expected to have any
                    Standards – Eligible    the principles underlying                         impact on the Group’s
                    Hedged Items            hedge accounting should                           financial report.
                                            be applied when (i) a one-
                                            sided risk in a hedged
                                            item is being hedged and
                                            (ii) inflation in a financial
                                            hedged item existed or was
                                            likely to exist.




50 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(b)   Statement of Compliance (Continued)

                                                                           Application                                  Application
                                                                             Date of          Impact on Group            Date for
 Reference             Title                     Summary                    Standard          Financial Report            Group
 AASB 2009-2   Amendments to             The main amendment                Annual            These amendments are       1 July 2009
               Australian Accounting     to AASB 7 requires fair           reporting         not expected to have any
               Standards –               value measurements to be          periods           impact on the Group’s
               Improving Disclosures     disclosed by the source of        beginning on or   financial report.
               about Financial           inputs, using the following       after 1 January
               Instruments [AASB 4,      three-level hierarchy:            2009 that end
               AASB 7, AASB 1023         •	 quoted prices (unadjusted)     on or after 30
               & AASB 1038]                 in active markets for          April 2009.
                                            identical assets or
                                            liabilities (Level 1);
                                         •	 inputs other than quoted
                                            prices included in Level
                                            1 that are observable
                                            for the asset or liability,
                                            either directly (as prices)
                                            or indirectly (derived from
                                            prices) (Level 2); and
                                         •	 inputs for the asset or
                                            liability that are not based
                                            on observable market
                                            data (unobservable
                                            inputs) (Level 3).
                                         These amendments
                                         arise from the issuance
                                         of Improving Disclosures
                                         about Financial Instruments
                                         (Amendments to IFRS 7) by
                                         the IASB in March 2009.
                                         The amendments to AASB
                                         4, AASB 1023 and AASB
                                         1038 comprise editorial
                                         changes resulting from the
                                         amendments to AASB 7.

 AASB 2009-4   Amendments to             The amendments to                 1 July 2009       These amendments are       1 July 2009
               Australian Accounting     some Standards result in                            not expected to have any
               Standards arising         accounting changes for                              impact on the Group’s
               from the Annual           presentation, recognition                           financial report.
               Improvements Project      or measurement purposes,
               [AASB 2 and AASB          while some amendments
               138 and AASB              that relate to terminology
               Interpretations 9 & 16]   and editorial changes
                                         are expected to have
                                         no or minimal effect on
                                         accounting.


 AASB 2009-5   Further Amendments        The amendments to                 1 January 2010    These amendments are       1 July 2010
               to Australian             some Standards result in                            not expected to have any
               Accounting Standards      accounting changes for                              impact on the Group’s
               arising from the          presentation, recognition                           financial report.
               Annual Improvements       or measurement purposes,
               Project [AASB 5, 8,       while some amendments
               101, 107, 117, 118,       that relate to terminology
               136 & 139]                and editorial changes
                                         are expected to have
                                         no or minimal effect on
                                         accounting.




                                                                                                    Mantra Resources Annual Report 2009   51
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.     Summary of Significant Accounting Policies (Continued)
    (b)    Statement of Compliance (Continued)

                                                                                Application                                 Application
                                                                                  Date of         Impact on Group            Date for
     Reference                  Title                   Summary                  Standard         Financial Report            Group
     AASB 2009-Y        Amendments to            These comprise editorial       1 July 2009      These amendments are       1 July 2009
                        Australian Accounting    amendments and are                              not expected to have any
                        Standards [AASB 5, 7,    expected to have no major                       impact on the Group’s
                        107, 112, 136 & 139      impact on the requirements                      financial report.
                        and Interpretation 17]   of the amended
                                                 pronouncements.

     Amendments         Amendments to IFRS 2     The amendments clarify the     1 January 2010   These amendments           1 July 2010
     to International                            accounting for group cash-                      are not expected to
     Financial                                   settled share-based payment                     have any impact on the
     Reporting                                   transactions, in particular:                    Group’s financial report
     Standards                                   •	 the scope of AASB 2; and                     as the Company does not
                                                                                                 have any cash-settled
                                                 •	 the interaction between
                                                                                                 share based payment
                                                    IFRS 2 and other
                                                                                                 transactions.
                                                    standards.




52 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(c)    Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Mantra Resources
Limited (“Company” or “Parent Entity”) as at year end and the results of all subsidiaries for the year then ended.
Mantra Resources Limited and its subsidiaries together are referred to as the Group or the Consolidated Entity.

Subsidiaries are all those entities (including special purpose entities) over which the Group has the power to govern
the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting
rights. The existence and potential effect of potential voting rights that are currently exercisable or convertible are
considered when assessing whether the Group controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated
from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries/assets by the Group
(refer to Note 1(g)).

Intercompany transactions and balances, and unrealised gains on transactions between Group companies, are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the
asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency
with the policies adopted by the Group.

(d)    Exploration and evaluation expenditure
Exploration and evaluation expenditure encompasses expenditures incurred by the Group in connection with the
exploration for and evaluation of mineral resources before the technical feasibility and commercial viability of
extracting a mineral resource are demonstrable.

For each area of interest, expenditure incurred in the acquisition of rights to explore is capitalised, classified as
tangible or intangible, and recognised as an exploration and evaluation asset. Exploration and evaluation assets
are measured at cost at recognition. Exploration and evaluation expenditure incurred by the Group subsequent
to acquisition of the rights to explore is expensed as incurred up to the commencement of Bankable Feasibility
Studies. Expenditure in relation to the preparation of Bankable Feasibility Studies is capitalised as incurred.

Expenditure is capitalised if the Company has rights to tenure and the Company expects to recoup the expenditures
through successful development or sale.

Capitalised exploration costs are reviewed each reporting date to establish whether an indication of impairment
exists. If any such indication exists, the recoverable amount of the capitalised exploration costs is estimated to
determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying
amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that
the increased carrying amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognised for the asset in previous years.

Where a decision is made to proceed with development, accumulated expenditure is tested for impairment and
transferred to development properties, and then amortised over the life of the reserves associated with the area of
interest once mining operations have commenced.

Recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful
development and commercial exploitation, or alternatively, sale of the respective areas of interest.




                                                                                       Mantra Resources Annual Report 2009   53
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.     Summary of Significant Accounting Policies (Continued)
    (e)     Revenue Recognition
    Revenue is measured at the fair value of the consideration received or receivable. The following specific recognition
    criteria must also be met before revenue is recognised:
    Interest
    Interest income is recognised on a time proportionate basis that takes into account the effective yield on the
    financial asset.

    (f)    Income Tax
    The income tax expense or income for the period is the tax payable or recoverable on the current period’s taxable
    income or tax loss based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax
    assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their
    carrying amounts in the financial statements, and to unused tax losses.

    Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when
    the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively
    enacted for each jurisdiction. The relevant tax rates are applied to the cumulative amounts of deductible and taxable
    temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary
    differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised
    in relation to these temporary differences if they arose in a transaction, other than a business combination, that at
    the time of the transaction did not affect either accounting profit or taxable profit or loss.

    Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable
    that future taxable amounts will be available to utilise those temporary differences and losses.

    Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
    tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of
    the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

    Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly
    in equity.

    Mantra Resources Limited and its 100% owned Australian resident subsidiaries have not yet elected to form a tax
    consolidated group. The Board will review this position annually, before lodgement of its annual income tax return.

    (g)    Acquisition of Assets
    The purchase method of accounting is used to account for all acquisitions of assets (including business combinations)
    regardless of whether equity instruments or other assets are acquired. Cost is measured as the fair value of the
    assets given, shares issued or liabilities incurred or assumed at the date of exchange plus costs directly attributable
    to the acquisition. Where equity instruments are issued in an acquisition, the value of the instruments is their
    published market price as at the date of exchange unless, in rare circumstances, it can be demonstrated that the
    published price at the date of exchange is an unreliable indicator of fair value and that other evidence and valuation
    methods provide a more reliable measure of fair value. Transaction costs arising on the issue of equity instruments
    are recognised directly in equity.




54 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(g)     Acquisition of Assets (continued)
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are
measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The
excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is
recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired,
the difference is recognised directly in the income statement, but only after a reassessment of the identification and
measurement of the net assets acquired.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted
to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate,
being the rate at which a similar borrowing could be obtained from an independent financier under comparable
terms and conditions.

(h)     Impairment of Assets
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment.
Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by
which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an
asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped
at the lowest levels for which there are separately identifiable cash flows (cash generating units).

(i)       Cash and Cash Equivalents
“Cash and cash equivalents” includes cash on hand, deposits held at call with financial institutions, other short-
term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current
liabilities on the balance sheet.

(j)     Receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the
effective interest rate method less an allowance for doubtful debts. Trade receivables are due for settlement no
more than 30 days from the date of recognition. An estimate of doubtful debts is made when collection of the full
amount is no longer probable. Bad debts are written off as incurred.

Receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective
interest rate method less impairment.

The effective interest method is a method of calculating the amortised cost of a receivable and of allocating interest
income over the relevant period. The effective interest rate is the interest rate that exactly discounts estimated
future cash receipts (including all fees on points paid or received that form an integral part of the effective interest
rate, transaction costs and other premiums or discounts) through the expected life of the receivable, or, where
appropriate, a shorter period.

(k)     Investments and Other Financial Assets
The Group classifies its investments in the following categories: financial assets at fair value through profit or
loss, loans and receivables, held-to-maturity investments, and available-for-sale financial assets. The classification
depends on the purpose for which the investments and other financial assets were acquired. Management
determines the classification of its investments and other financial assets at initial recognition and re-evaluates this
designation at each reporting date.




                                                                                        Mantra Resources Annual Report 2009   55
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.     Summary of Significant Accounting Policies (Continued)
    (k)     Investments and Other Financial Assets (Continued)
    (i) Financial assets at fair value through profit or loss
    Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified
    in this category if acquired principally for the purpose of selling in the short term. Derivatives are also categorised
    as held for trading unless they are designated as hedges. Assets in this category are classified as current assets.

    (ii) Loans and receivables
    Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted
    in an active market. They arise when the Group provides money, goods or services directly to a debtor with no
    intention of selling the receivable. They are included in current assets, except for those with maturities greater than
    twelve months after the balance sheet date which are classified as non-current assets. Loans and receivables are
    included in receivables in the balance sheet.

    (iii) Held-to-maturity investments
    Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed
    maturities that the Group’s management has the positive intention and ability to hold to maturity.

    (iv) Available-for-sale financial assets
    Available-for-sale financial assets, comprising principally marketable equity securities, are non-derivatives that are
    either designated in this category or not classified in any of the other categories. They are included in non-current
    assets unless management intends to dispose of the investment within twelve months of the balance sheet date.

    Purchases and sales of investments are recognised on trade-date – the date on which the Group commits to
    purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial
    assets not carried at fair value through profit or loss. Financial assets are derecognised when the rights to receive
    cash flows from the financial assets have expired or have been transferred and the Group has transferred
    substantially all the risks and rewards of ownership.

    Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently carried
    at fair value. Loans and receivables and held-to-maturity investments are carried at amortised cost using the
    effective interest rate method. Realised and unrealised gains and losses arising from changes in the fair value of
    the ‘financial assets at fair value through profit or loss’ category are included in the income statement in the period
    in which they arise. Unrealised gains and losses arising from changes in the fair value of non-monetary securities
    classified as available-for-sale are recognised in equity in the available-for-sale investments revaluation reserve.
    When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments are
    included in the income statement as gains and losses from investment securities.

    The fair values of quoted investments are based on current bid prices. If the market for a financial asset is not
    active (and for unlisted securities), the Group establishes fair value by using valuation techniques. These include
    reference to the fair values of recent arm’s length transactions, involving the same instruments or other instruments
    that are substantially the same, discounted cash flow analysis, and option pricing models.

    The Group assesses at each balance date whether there is objective evidence that a financial asset or group of
    financial assets is impaired. In the case of equity securities classified as available for sale, a significant or prolonged
    decline in the fair value of a security below its cost is considered in determining whether the security is impaired.
    If any such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference
    between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously
    recognised in profit and loss – is removed from equity and recognised in the income statement. Impairment losses
    recognised in the income statement on equity instruments are not reversed through the income statement.




56 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(l)       Fair value estimation
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and
available-for-sale securities) is based on quoted market prices at the balance sheet date. The quoted market price
used for financial assets held by the Group is the current bid price; the appropriate quoted market price for financial
liabilities is the current ask price.

The fair value of financial instruments that are not traded in an active market (for example, over the counter
derivatives) is determined using valuation techniques. The Group uses a variety of methods and makes assumptions
that are based on market conditions existing at each balance date. Quoted market prices or dealer quotes for
similar instruments are used for long-term debt instruments held. Other techniques, such as discounted cash flows,
are used to determine fair value for the remaining financial instruments.

(m)     Property, Plant and Equipment
Plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly
attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of
the item can be measured reliably. All other repairs and maintenance are charged to the income statement during
the financial period in which they are incurred.

Plant and equipment are depreciated or amortised on a reducing balance or straight line basis at rates based upon
their expected useful lives as follows:

                                                                                           Life

 Plant and equipment                                                                 2 – 15 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount (Note 1(h)).

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included
in the income statement.

(n)      Payables
Liabilities for trade creditors and other amounts are carried at amortised cost which is the fair value of the
consideration to be paid in the future for goods and services received, whether or not billed to the consolidated
entity. The amounts are unsecured and are usually paid within 30 days.

Payables to related parties are carried at amortised cost.




                                                                                        Mantra Resources Annual Report 2009   57
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.     Summary of Significant Accounting Policies (Continued)
    (o)	     Employee	Benefits
    Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave
    expected to be settled within twelve months of the reporting date are recognised in provisions in respect of employees’
    services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are
    settled. Liabilities for non-accumulating sick leave are recognised when the leave is taken and measured at the
    rates paid or payable. Employee benefits payable later than one year are measured at the present value of the
    estimated future cash flows to be made for those benefits. Contributions to defined contribution super plans are
    expensed when the employees have rendered the services entitling them to the contributions.

    (p)   Contributed Equity
    Issued and paid up capital is recognised at the fair value of the consideration received by the Company.

    Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
    net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options, for the
    acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration.

    (q)    Dividends
    Provision is made for the amount of any dividend declared on or before the end of the year but not distributed at
    balance date.

    (r)    Earnings per Share
    Basic earnings per share is calculated by dividing the profit attributable to equity holders of the company, excluding
    any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
    outstanding during the year, adjusted for bonus elements in ordinary shares issued during the year.

    Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
    account the after tax effect of interest and other financing costs associated with dilutive potential ordinary shares
    and the weighted average number of shares assumed to have been issued for no consideration in relation to
    dilutive potential ordinary shares.

    (s)  Goods and Services Tax
    Revenues, expenses and assets are recognised net of the amount of GST except:

    •	   where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority,
         in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense
         item as applicable; and
    •	   receivables and payables are stated with the amount of GST included.
    The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or
    payables in the balance sheet.

    Cash flows are included in the Cash Flow Statement on a gross basis and the GST components of cash flows
    arising from investing and financing activities, which are recoverable from, or payable to, the taxation authority are
    classified as operating cash flows.




58 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
1.    Summary of Significant Accounting Policies (Continued)
(t)   Share Based Payments
Share based payments are provided to directors, employees, consultants and other advisors and to acquire assets
such as mineral exploration licences.

The fair value of options granted (determined using the Binomial option pricing model) is recognised as an expense
or asset, as appropriate with a corresponding increase in equity. The fair value is measured at grant date and
recognised over the period during which option holders become unconditionally entitled to the options.

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-
line basis over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest.

(u)    Foreign Currency Translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (“the functional currency”). The consolidated financial
statements are presented in Australian dollars, which is the Company’s functional and presentation currency.

(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions
and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign
currencies are recognised in the income statement, except when deferred in equity as qualifying cash flow hedges
and qualifying net investment hedges.

Translation differences on non-monetary items, such as equities held at fair value through profit or loss, are reported
as part of the fair value gain or loss. Translation differences on non-monetary items, such as equities classified as
available-for-sale financial assets, are included in the available-for-sale investments revaluation reserve in equity.

(iii) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary
economy) that have a functional currency different from the presentation currency are translated into the presentation
currency as follows:
•	     Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that
       balance sheet;
•	   Income and expenses for each income statement are translated at average exchange rates (unless this is not
     a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which
     case income and expenses are translated at the dates of the transactions); and
•	   All resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of
borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders
equity. Where a foreign operation is sold or borrowings repaid, a proportionate share of such exchange differences
are recognised in the income statement as part of the gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities
of the foreign entity and translated at the closing rate.




                                                                                       Mantra Resources Annual Report 2009   59
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    1.     Summary of Significant Accounting Policies (Continued)
    (v)       Goodwill
    (i) Initial Recognition
    Goodwill acquired in a business combination is initially measured at its cost, being the excess of the cost of
    the business combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and
    contingent liabilities recognised at the date of acquisition. Goodwill is subsequently measured at its cost less any
    accumulated impairment losses. For the purpose of impairment testing, goodwill is allocated to each of the Group’s
    cash-generating units, or groups of cash-generating units, expected to benefit from the synergies of the business
    combination. Cash-generating units or groups of cash-generating units to which goodwill has been allocated are
    tested for impairment annually, or more frequently if events or changes in circumstances indicate that goodwill
    might be impaired.

    (ii) Impairment
    If the recoverable amount of the cash-generating unit (or group of cash-generating units) is less than the carrying
    amount of the cash-generating unit (or groups of cash-generating units), the impairment loss is allocated first to
    reduce the carrying amount of any goodwill allocated to the cash-generating unit (or groups of cash-generating
    units) and then to the other assets of the cash-generating unit (or groups of cash-generating units). An impairment
    loss recognised for goodwill is recognised immediately in profit or loss and is not reversed in a subsequent period.
    On disposal of an operation within a cash-generating unit, the attributable amount of goodwill is included in the
    determination of the profit or loss on disposal of the operation.

    Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to
    which goodwill has been allocated. The value in use calculation requires the entity to estimate the future cash flows
    expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value.

                                                                   Consolidated                     Company
                                                                2009           2008            2009           2008
                                                                  $              $               $              $

     2.    Revenue From Continuing Operations
     Revenue
     Interest revenue                                        1,551,777      1,525,885       1,537,373        935,655
     Other income                                               25,169                -               -              -




60 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
                                                           Consolidated                       Company
                                                        2009           2008            2009                2008
                                                          $              $               $                   $
3.      Expenses and Losses From Continuing
        Operations
Loss from ordinary activities before income tax
expense includes the following specific expenses:
(a)     Expenses
Foreign exchange loss                                 (31,593)       (637,936)          (2,530)                    -
Provision for non-recovery of intercompany loan                -              -   (13,678,958)         (7,388,176)
Other                                                          -       (12,761)               -                    -
                                                      (31,593)       (650,697)    (13,681,488)         (7,388,176)


(b)     Depreciation
Depreciation of plant and equipment                  (305,908)       (172,836)          (4,230)            (17,891)


(c)     Employee	benefit	expense
Salaries and wages                                  (2,483,945)     (1,240,199)      (781,909)           (347,500)
Defined contribution superannuation                  (365,403)         (69,339)       (72,000)             (57,775)
Bonuses                                                        -       (50,000)               -            (50,000)
Share-based payments                                (4,838,677)      (385,950)       (701,481)                     -
Other employee benefits                                        -        (9,515)               -             (3,250)
                                                    (7,688,025)     (1,755,003)    (1,555,390)           (458,525)


(d)     Other share based payments expense
Share-based payments                                (2,617,010)     (1,134,250)    (6,754,206)         (1,134,250)


(e)     Impairment
Impairment of goodwill (Mavuzi acquisition)
                                                               -   (31,306,029)               -                    -
(refer Note 11 and Note 21)
Impairment of investment (refer Note 10)                       -              -    (5,300,000)        (31,306,029)
                                                               -   (31,306,029)    (5,300,000)        (31,306,029)




                                                                                  Mantra Resources Annual Report 2009   61
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
                                                                       Consolidated                        Company
                                                                   2009          2008               2009               2008
                                                                     $             $                  $                  $
     4.       Income Tax
     (a)      Recognised in the Income Statement
     Current income tax
           Current income tax expense/(benefit)                 (6,376,881)    (1,863,189)          (56,021)         (183,165)


     Deferred income tax
           Adjustments in respect of current income
                                                                    61,305                  -        43,603                   -
           tax of prior years
           Origination and reversal of
                                                                1,914,810       (242,722)           (82,217)          102,633
           temporary differences
           Deferred tax assets not recognised                   4,400,766       2,105,911            94,635            80,532
     Income tax expense reported in the income
                                                                        -               -                  -                  -
     statement


     (b)      Reconciliation Between Tax Expense and
              Accounting	Profit/(Loss)	Before	Income	Tax	
     Accounting profit/(loss) before income tax                (30,133,817)   (41,521,094)      (29,831,157)       (41,658,245)
     At the domestic income tax rate of 30%
                                                                (9,040,145)   (12,456,328)       (8,949,347)       (12,497,474)
     (2008: 30%)
           Expenditure not allowable for income tax
                                                                 4,187,321    10,667,500          8,811,108        12,445,447
           purposes
           Adjustments in respect of current income tax
                                                                    61,305                  -        43,603                       -
           of prior years
           Deferred tax assets not recognised                    4,852,260     1,934,240             94,636            52,027
           Effect of higher income tax in other jurisdiction       (60,741)     (145,412)                      -                  -
     Income tax expense reported in the
                                                                         -              -                      -                  -
     income statement


     (c)      Deferred Income Tax
     Deferred income tax at 30 June relates to
     the following:
     Deferred Tax Liabilities
           Property, Plant and Equipment                            24,074                  -                  -                  -
           Accrued interest income                                  28,874       116,755             28,874           116,487
           Deferred tax assets used to offset deferred
           tax liabilities                                         (52,948)      (116,755)          (28,874)          (116,487)
                                                                         -              -                  -                  -




62 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
                                                                     Consolidated                    Company
                                                                 2009           2008             2009      2008
                                                                   $              $                $         $

 4.      Income Tax (continued)
 Deferred Tax Assets
      Property, plant and equipment                              38,397           53,066              -                -
      Accrued expenditure                                        22,425           24,825       22,425           37,725
      Provisions                                                 50,974           26,227       50,974           21,154
      Business related costs                                    146,382         255,359        63,125         126,645
      Tax losses available to offset against future
                                                              7,330,070       2,440,319       201,756         301,941
      taxable income
      Deferred tax assets used to offset deferred tax
                                                                (52,948)        (116,755)     (28,874)        (116,487)
      liabilities
      Deferred tax assets not recognised                     (7,535,300)      (2,683,041)    (309,406)        (370,978)
                                                                       -                 -            -                -

The benefit of deferred tax assets not brought to account will only be brought to account if:
•	  future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
•	  the conditions for deductibility imposed by tax legislation continue to be complied with; and
•	  no changes in tax legislation adversely affect the Company in realising the benefit.

(d)    Tax Consolidation
Mantra Resources Limited and its 100% owned Australian resident subsidiaries have not yet elected to form a tax
consolidated group. The Board will review this position annually, before lodgement of its annual income tax return.

 5.      Current Assets –
         Trade and Other Receivables
 GST and VAT receivable                                          390,642        185,122        127,832           51,290
 Accrued Interest receivable                                      96,246        389,183         96,246         388,290
 Other                                                            11,186         81,892                   -                -
                                                                 498,074        656,197        224,078         439,580



 6.      Current Assets – Other Assets
 Prepayments                                                     61,792         54,865                 -               -
 Deposits paid                                                   12,632        180,917                 -               -
                                                                 74,424        235,782                 -               -




                                                                                      Mantra Resources Annual Report 2009      63
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
                                                                     Consolidated                   Company
                                                                   2009        2008             2009       2008
                                                                     $           $                $          $
      7.     Current Assets –
             Other Financial Assets
      Amounts loaned to third parties*                            202,362       312,012               -             -
                                                                  202,362       312,012               -             -

    *Terms & Conditions

    The loan to the third party (a drilling company) was undertaken on commercial terms and conditions, except that
    there is no fixed repayment of the loan by the third party. The key terms of the loan are as follows:
    (i)      The funds were used to manufacture a drilling rig;
    (ii)     The repayment of the loan was initially offset against the invoices of the third party for the provision of
             drilling services. The drilling program was completed in December 2008 and the balance of the loan is
             being repaid by the third party;
    (iii)    There is no fixed repayment of the loan, however the third party is expected to re-commence drilling shortly
             and the loan is expected to be fully repaid by 31 December 2009; and
    (iv)     Up to 31 December 2008, the loan was interest bearing at 7% per annum calculated against the balance of the
             loan with interest compounded on a daily basis. Effective 1 January 2009, the loan became interest free.

      8.     Non-Current Assets –
             Property, Plant And Equipment
      Plant and equipment
      Cost                                                        1,544,292      993,172         61,239         53,857
      Accumulated depreciation                                     (515,563)     (241,197)       (50,439)      (46,209)
      Net carrying amount                                         1,028,729      751,975         10,800          7,648


      Reconciliation
      Carrying amount at beginning of year                         751,975       129,655           7,648        21,380
      Additions                                                    468,458       528,096           7,382         4,159
      Additions – Mavuzi acquisition (net of depreciation)                  -    270,386                  -             -
      Depreciation charge for the year                             (305,908)     (172,836)        (4,230)      (17,891)
      Foreign currency gain/(loss) on translation                  114,204         (3,326)                -             -
      Carrying amount at end of year, net of accumulated
                                                                  1,028,729      751,975         10,800          7,648
      depreciation and impairment




64 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
                                                                        Consolidated                       Company
                                                                      2009           2008             2009             2008
                                                                        $              $                $                $
 9.      Non-Current Assets –
         Exploration and Evaluation Assets
 At 30 June 2008, the company had mineral exploration
 costs carried forward in respect of areas of interest which
 were fully impaired during the year ended 30 June 2009:

 (a)     Areas of interest:
 Tanzania
 Mkuju River Project                                                         -     192,073                    -      192,073
 Bahi North Project                                                          -              1                 -               -
 Southern Tanzania JV’s                                                      -     508,454                    -      329,047
 Mbamba Bay Project                                                          -     328,689                    -      328,689
 Central Tanzania JV’s                                                       -     277,248                    -      277,249
 Mozambique
 Mavuzi & Meponda Projects (Note 21)                                         -   5,300,000                    -               -
 Malawi
 Chintheche/Chikangawa & Nankenza Projects                                   -     963,683                    -      963,683
                                                                             -   7,570,148                    -    2,090,741


 (b)     Reconciliation
 Carrying amount at beginning of year, at cost                    7,570,148        849,810         2,090,741         849,808
 Obtained on acquisition of Mavuzi at fair value                             -   5,300,000                    -               -
 Obtained on acquisition of Malawi assets                                    -     690,000                    -      690,000
 Capitalised expenditure                                            109,349        730,338                    -      550,933
 Less: Provision for impairment     (1)
                                                                 (7,759,787)                -     (2,090,741)                 -
 Add: Foreign currency translation                                    80,290                -                 -               -
 Carrying amount at end of year                                              -   7,570,148                    -    2,090,741

The abovementioned exploration assets are comprised solely of intangible assets.
Notes
(1)     During the year ended 30 June 2009, there was an impairment loss of $7,759,787 charged to the Consolidated Entity’s
        exploration and evaluation assets. Given the Company’s strategy of focussing on the development of its wholly owned
        Nyota Prospect in southern Tanzania, and due to insufficient encouragement from the exploration results obtained, the
        decision was made to fully impair the value of the Consolidated Entity’s non-core exploration assets in Mozambique
        ($5,300,000), Tanzania ($1,531,363) and Malawi ($963,683). It is further noted that the Company elected to withdraw
        from all of it Projects in Malawi due to insufficient encouragement from the exploration results obtained.




                                                                                            Mantra Resources Annual Report 2009   65
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
                                                                   Consolidated                          Company
                                                                2009            2008             2009          2008
                                                                  $               $                $             $
     10.    Non-Current Assets –
            Other Financial Assets
     Investment in controlled entities – at cost (note 21)             -           -       44,117,333       44,117,333
     Less: Provision for impairment (note 21)                          -           -       (31,306,029)    (31,306,029)
     Less: Provision for impairment (note 9(1))                        -           -        (5,300,000)               -
                                                                       -           -         7,511,304      12,811,304


     11.    Non-Current Assets – Goodwill
     Goodwill recognised on acquisition of Mavuzi                      -   31,306,029                -                -
     Less: Impairment loss (note 21)                                   -   (31,306,029)              -                -
                                                                       -               -             -                -

     12.    Current Liabilities –
            Trade and Other Payables
     Accrued expenses                                         845,858       1,496,884          74,750         125,750
     Trade creditors                                          592,045         561,995         528,610         544,837
     Withholding taxes payable                                146,935         246,126                -                -
                                                             1,584,838      2,305,005         603,360         670,587

    Notes
    (1) Trade and other payables are non-interest bearing.


     13. Current Liabilities – Provisions
     Employee benefits                                        230,399         110,378         169,915           70,513


     14.    Current Liabilities – Borrowings
     Amounts owing to third party *                           740,380         740,380                -                -
     Amounts owing to controlled entity **                             -               -     6,837,082       7,292,262
                                                              740,380         740,380        6,837,082       7,292,262




66 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
14. Current Liabilities – Borrowings (Continued)
Terms & Conditions
*The loan payable to the third party was undertaken on commercial terms and conditions, except that:
(i) There is no fixed repayment of the loan between the parties; and
(ii) No interest is payable on the loan.
**The loan payable to the controlled entity was undertaken on commercial terms and conditions, except that:
(i) There is no fixed repayment of loans between the related parties; and
(ii) No interest is payable on the loans.

                                                                    Consolidated                    Company
                                                                2009          2008              2009      2008
                                                                  $             $                 $         $
 15. Issued Capital
 (a)    Issued and Paid up Capital
 108,604,994 (2008: 79,682,513)
 fully paid ordinary shares                                 91,163,906    73,424,522       91,163,906       73,424,522

(b)    Movements in Ordinary Share Capital during the Past Two Years:
                                                                                           Number of
           Date                                       Details                               Shares                  $
 1 Jul 2007                  Opening Balance                                               44,099,185         13,179,448
 19 September 2007           Acquisition Malawi exploration assets (note 25(d)(2)(ii))         600,000            690,000
                             Share issue expenses                                                       -           (3,283)
                             Allotment of Mavuzi Scheme Consideration
 11 March 2008                                                                             18,267,169         34,707,621
                             (note 21)
                             Share issue expenses                                                       -         (30,322)
 19 March 2008               Highland Park Placement – Tranche A                             6,700,000        13,400,000
                             Share issue expenses                                                       -         (18,335)
 28 April 2008               Highland Park Placement – Tranche B                             5,300,000        10,600,000
                             Share issue expenses                                                       -         (46,363)
 July 2007 to June 2008      Exercise of listed options (note 16(b))                         4,716,159            945,756
 30 Jun 2008                 Closing Balance                                               79,682,513         73,424,522
 July 2008 to June 2009      Exercise of listed options (note 16(b))                       19,872,481          3,971,979
                             Transfer of option premium reserve                                         -      9,679,712
 July 2008 to June 2009      Exercise of $0.20 unlisted options (note 16(b))                 7,650,000         1,530,000
                             Transfer of option premium reserve                                         -         865,150
 July 2008 to June 2009      Exercise of $0.25 unlisted options (note 16(b))                   650,000            162,500
                             Transfer of option premium reserve                                         -         195,650
 July 2008 to June 2009      Exercise of $0.30 unlisted options (note 16(b))                   250,000             75,000
 July 2008 to June 2009      Exercise of $1.50 unlisted options (note 16(b))                   500,000            750,000
                             Transfer of option premium reserve                                         -         580,000
 July 2008 to June 2009      Share issue expenses                                                       -         (70,607)
 30 Jun 2009                 Closing Balance                                              108,604,994         91,163,906




                                                                                         Mantra Resources Annual Report 2009   67
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    15. Issued Capital (Continued)
    (c)   Rights attaching to Shares
    The rights attaching to fully paid ordinary shares (“Shares”) arise from a combination of the Company’s Constitution,
    statute and general law.

    Copies of the Company’s Constitution are available for inspection during business hours at the Company’s
    registered office. The clauses of the Constitution contain the internal rules of the Company and define matters
    such as the rights, duties and powers of its shareholders and directors, including provisions to the following effect
    (when read in conjunction with the Corporations Act 2001 or ASX Listing Rules):

    (1)   Shares
    The issue of shares in the capital of the Company and options over unissued shares by the Company is under the
    control of the directors, subject to the Corporations Act 2001, ASX Listing Rules and any rights attached to any
    special class of shares.

    (2)   Meetings of Members
    Directors may call a meeting of members whenever they think fit. Members may call a meeting as provided by the
    Corporations Act 2001. The Constitution contains provisions prescribing the content requirements of notices of
    meetings of members and all members are entitled to a notice of meeting. A meeting may be held in two or more
    places linked together by audio-visual communication devices. A quorum for a meeting of members is 2 natural
    persons, each of whom is or represents different Shareholders who are eligible to vote.

    The Company holds annual general meetings in accordance with the Corporations Act 2001 and the ASX Listing Rules.

    (3)   Voting
    Subject to any rights or restrictions at the time being attached to any shares or class of shares of the Company,
    each member of the Company is entitled to receive notice of, attend and vote at a general meeting. Resolutions of
    members will be decided by a show of hands unless a poll is demanded. On a show of hands each eligible voter
    present has one vote. However, where a person present at a general meeting represents personally or by proxy,
    attorney or representative more than one member, on a show of hands the person is entitled to one vote only
    despite the number of members the person represents.

    On a poll each eligible member has one vote for each fully paid share held and a fraction of a vote for each partly
    paid share determined by the amount paid up on that share.

    (4)   Changes to the Constitution
    The Company’s Constitution can only be amended by a special resolution passed by at least three quarters of the
    members present and voting at a general meeting of the Company. At least 28 days’ written notice specifying the
    intention to propose the resolution as a special resolution must be given.

    (5)   ASX Listing Rules
    Provided the Company is admitted to the Official List, then despite anything in its Constitution, no act may be done that
    is prohibited by the ASX Listing Rules, and authority is given for acts required to be done by the ASX Listing Rules. The
    Company’s Constitution will be deemed to comply with the ASX Listing Rules as amended from time to time.




68 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
                                                                   Consolidated                   Company
                                                                 2009          2008          2009            2008
                                                                   $             $             $               $
 16. Reserves
 (a)   Reserves
 Option Reserve
 Nil (30 June 2008: 19,917,708) $0.20 Listed Options                    -    9,679,712              -     9,679,712
 Nil (30 June 2008: 7,650,000) $0.20 Unlisted Options                   -     865,150               -       865,150
 Nil (30 June 2008: 650,000) $0.25 Unlisted Options                     -     195,650               -       195,650
 Nil (30 June 2008: 250,000) $0.30 Unlisted Options                     -             -             -                -
 650,000 (30 June 2008: 650,000)
                                                               190,100        190,100      190,100          190,100
 $0.35 Unlisted Options
 350,000 (30 June 2008: 350,000)
                                                               200,900        200,900      200,900          200,900
 $0.90 Unlisted Options
 600,000 (30 June 2008: 350,000)
                                                               259,550        197,050      259,550          197,050
 $1.20 Unlisted Options
 Nil (30 June 2008: 500,000) $1.50 Unlisted Options                     -     580,000               -       580,000
 2,050,000 (30 June 2008: Nil) $1.65 Unlisted Options          527,890                -    527,890                   -
 6,000,000 (30 June 2008: 6,000,000)
                                                                        -             -             -                -
 $2.20 Unlisted Options
 3,350,000 (30 June 2008: 1,300,000)
                                                             3,194,300                -   3,194,300                  -
 $2.50 Unlisted Options
 800,000 (30 June 2008: 500,000)
                                                             1,058,468                -   1,058,468                  -
 $3.00 Unlisted Options
 500,000 (30 June 2008: 700,000)
                                                             1,612,029                -   1,612,029                  -
 $3.50 Unlisted Options
 Nil (30 June 2008: 500,000) $4.50 Unlisted Options          1,000,500                -   1,000,500                  -
                                                             8,043,737      11,908,562    8,043,737     11,908,562
 Foreign Currency Translation Reserve
 Currency translation differences                              895,033        705,701               -                -
 Total Reserves                                              8,938,770      12,614,263    8,043,737     11,908,562

Option Premium Reserve
The option premium reserve is used to record the grant date fair value of share-based payments and other option
grants/acquisitions made by the Company.

Foreign currency translation reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of the
financial statements of foreign subsidiaries.




                                                                                   Mantra Resources Annual Report 2009   69
                                         For the Year Ended 30 June 2009
                                         16.           Reserves (Continued)
                                         (b)           Movements in Options during the Past Two Years were as follows:
                                                                                     Number        Number      Number      Number      Number     Number     Number     Number      Number      Number      Number      Number     Number        Number
                                                                                     of $0.20      of $0.20    of $0.25    of $0.30    of $0.35   of $0.90   of $1.20   of $1.50    of $1.65    of $2.20    of $2.50    of $3.00   of $3.50      of $4.50
                                                                                      Listed       Unlisted    Unlisted    Unlisted    Unlisted   Unlisted   Unlisted   Unlisted    Unlisted    Unlisted    Unlisted    Unlisted   Unlisted      Unlisted
                                               Date          Details        Note     Options       Options     Options     Options     Options    Options    Options    Options     Options     Options     Options     Options    Options       Options           $
                                                          Opening
                                         1 July 2007                                14,210,726     7,150,000    500,000           -     500,000          -          -          -            -           -           -          -            -           -        978,650
                                                          Balance
                                                          Grant of
                                         19 Sept 2007                                         -            -    150,000           -     150,000    350,000    350,000          -            -           -           -          -            -           -        670,200




70 Mantra Resources Annual Report 2009
                                                          Options
                                                          Grant of
                                         11 March 2008                       21      6,273,141             -          -           -           -          -          -          -            -           -           -          -            -           -      9,409,712
                                                          Options
                                                          Grant of
                                         11 March 2008                                        -     500,000           -     250,000           -          -          -          -            -           -           -          -            -           -               -
                                                          Options
                                                          Grant of
                                         19 March 2008                               2,233,333             -          -           -           -          -          -          -            -           -           -          -            -           -               -
                                                          Options
                                                          Grant of
                                         28 April 2008                               1,766,667             -          -           -           -          -          -          -            -   6,000,000           -          -            -           -               -
                                                          Options
                                                          Grant of
                                         28 April 2008                                 150,000             -          -           -           -          -          -          -            -           -           -          -            -           -        270,000
                                                          Options
                                                          Grant of
                                         28 April 2008                                        -            -          -           -           -          -          -    500,000            -           -           -          -            -           -        580,000
                                                          Options
                                                          Grant of
                                         27 June 2008                                         -            -          -           -           -          -          -          -            -           -   1,300,000    500,000     700,000      500,000               -
                                                          Options
                                                          Exercise of
                                         Jul 07 to Jun 08                   15(b)    (4,716,159)           -          -           -           -          -          -          -            -           -           -          -            -           -               -
                                                          options
                                                          Closing
                                         30 June 2008                               19,917,708     7,650,000    650,000     250,000     650,000    350,000    350,000    500,000            -   6,000,000   1,300,000    500,000     700,000      500,000     11,908,562
                                                          Balance
                                                          Opening
                                         1 July 2008                                19,917,708     7,650,000    650,000     250,000     650,000    350,000    350,000    500,000            -   6,000,000   1,300,000    500,000     700,000      500,000     11,908,562
                                                          Balance
                                                          Grant of
                                         28 Nov 2008                                          -            -          -           -           -          -          -          -            -           -   1,200,000          -   1,200,000                            -
                                                          Options
                                                          Grant of
                                         30 Jan 2009                                          -            -          -           -           -          -    250,000          -            -           -           -          -            -           -         62,500
                                                          Options
                                                          Grant of
                                         12 March 2009                                        -            -          -           -           -          -          -          -     850,000            -    850,000           -            -           -               -
                                                          Options
                                                          Cancellation of
                                         12 March 2009                                        -            -          -           -           -          -          -          -            -           -           -          -   (1,700,000)   (500,000)              -
                                                          Options
                                                          Grant of
                                         29 April 2009                                        -            -          -           -           -          -          -          -    1,200,000           -           -          -            -           -               -
                                                          Options
                                                          Grant of
                                         30 June 2009                                         -            -          -           -           -          -          -          -            -           -           -    300,000     300,000            -               -
                                                          Options
                                                          Options vested
                                         30 June 2009                                         -            -          -           -           -          -          -          -            -           -           -          -            -           -      7,393,187
                                                          expense
                                                          Expiry of
                                         30 June 2009                                   (45,227)           -          -           -           -          -          -          -            -           -           -          -            -           -               -
                                                                                                                                                                                                                                                                            Notes to and Forming Part of the Financial Statements




                                                          options
                                                          Exercise of
                                         Jul 08 to Jun 09                   15(b)   (19,872,481) (7,650,000)   (650,000)   (250,000)          -          -          -   (500,000)           -           -           -          -            -           -    (11,320,512)
                                                          options
                                                          Closing
                                         30 June 2009                                         -            -          -           -     650,000    350,000    600,000          -    2,050,000   6,000,000   3,350,000    800,000     500,000            -      8,043,737
                                                          Balance
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
                                                                  Consolidated                       Company
                                                                2009        2008                 2009       2008
                                                                  $           $                    $          $
16.    Reserves (Continued)
(c)    Movements in foreign currency translation reserve
       during the past two years were as follows:-
Balance at the beginning of period                             705,701        120,585              -                -
Currency translation differences                               189,332         585,116             -                -
Balance at end of year                                         895,033        705,701              -                -

(d)   Terms and conditions of the Unlisted Options
         The Unlisted Options (“Options”) are granted based upon the following terms and conditions:
        •	     Each Option entitles the holder to subscribe for one Share upon exercise of each Option.
        •	     The Options have exercise prices and expiry dates as follows:
               - $0.35 Incentive Options expire 30 June 2010.
               - $0.90 Incentive Options expire 31 December 2009.
               - $1.20 Options expire 31 December 2010.
               - $1.65 Incentive Options expire 31 December 2010.
               - $2.20 Options expire 30 June 2011.
               - $2.50 Incentive Options expire 30 June 2010.
               - $3.00 Incentive Options expire 31 December 2010.
               - $3.50 Incentive Options expire 30 June 2011.
        •	     The Options are exercisable at any time prior to the Expiry Date, subject to the vesting conditions
               being satisfied (if applicable).
        •	     Shares issued on exercise of the Options rank equally with the then shares of the Company.
        •	     Application will be made by the Company to ASX for official quotation of the Shares issued upon the
               exercise of the Options.
        •	     If there is any reconstruction of the issued share capital of the Company, the rights of the Optionholders
               may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of
               the reconstruction.
        •	     No application for quotation of the Options will be made by the Company.
        •	     Subject to the proposed transferee being a party which is within the class of parties in section 708
               of the Corporations Act to which disclosure is not required, the Options are transferable.




                                                                                         Mantra Resources Annual Report 2009   71
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
                                                                     Consolidated                    Company
                                                                2009            2008            2009            2008
                                                                  $               $               $               $
    17.     Accumulated Losses
    Balance at the beginning of period                      (44,604,755)     (3,083,661)    (43,153,200)     (1,494,955)
    Net loss                                                (30,133,817)    (41,521,094)    (29,831,157)    (41,658,245)
    Balance at end of year                                  (74,738,572)    (44,604,755)    (72,984,357)    (43,153,200)

    (a)    Franking Account
    In respect to the payment of dividends (if any) by Mantra in subsequent financial years, no franking credits are
    currently available, or are likely to become available in the next 12 months.

    18.     Key Management Personnel Compensation
    (a)   Details of Key Management Personnel
    The Key Management Personnel of the Group during or since the end of the financial year were as follows:

    Directors
    Mr Ian Middlemas
    Mr Robert Behets
    Mr Matthew Yates
    Mr Colin Steyn
    Mr Mark Pearce

    Other Key Management Personnel
    Luke Watson – Company Secretary
    Tony Devlin – Country Manager, Tanzania (commenced 1 September 2008)
    There were no other key management personnel during the reporting period.

    (b)    Key Management Personnel Compensation
    The following table provides a summary of all key management personnel of the Company and the Group and
    the nature and total compensation for the financial year ended 30 June 2009, and for the financial year ended 30
    June 2008. Key management personnel disclosures previously required by AASB 124 Related Party Disclosures
    paragraphs Aus25.2 to Aus25.6 and Aus25.7.1 and Aus25.7.2 are included the Remuneration Report section of the
    Directors’ Report (refer pages 13-20).

                                                                              Post                Share
                                                                           Employment            Based
                                            Short-Term Benefits             Benefits            Payments          Total
                                           Salary &        Cash
                                            Fees           Bonus         Superannuation          Options
                                              $              $                 $                    $               $
     TOTAL              2009              1,345,309              -            116,531          3,442,490      4,904,330
     TOTAL              2008                398,500       50,000               35,775               1,734       486,009

    Notes

    Other than the Directors, Company Secretary, and Country Manager of Tanzania, there were no Key Management Personnel of
    the Company or Group during the year.




72 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
19.      Related Party Disclosures
(a)   Shareholdings of Key Management Personnel
The aggregate numbers of shares of the Company held directly, indirectly or beneficially by key management
personnel of the Company or their related entities at balance date is as follows:

      Key Management                Opening         Purchases         Received                                               Held at
          Person                   Balance at                        on exercise            Other                            30 June
           2009                    1 July 2008                        of options           Changes        Sales               2009
                                        (#)              (#)               (#)               (#)            (#)                (#)
Directors
Mr Ian Middlemas                     1,120,000                 -        520,000(1)            -                   -          1,640,000
Mr Robert Behets                       184,499                 -      1,084,916      (1)
                                                                                              -        (100,000)      (1)
                                                                                                                             1,169,415
Mr Matthew Yates                       193,332                 -      1,955,833(1)            -        (200,000) (1)         1,949,165
Mr Colin Steyn (2)                  13,080,649       2,333,333(3)       625,000(1)            -                   -         16,038,982
Mr Mark Pearce                         109,997                 -         43,628      (1)
                                                                                              -                   -           153,625
Officer
Mr Luke Watson                           17,986                -        302,995(1)            -         (50,000) (1)          270,981
Mr Tony Devlin
                                                -              -                 -            -                   -                    -
(appointed 1 Sept 2008)

Notes
(1)     Exercise of listed and unlisted options expiring 30 June 2009 (refer Note 19(b) for further details).
        Messers Behets, Yates and Watson each sold shares in June 2009 for the purposes of financing the costs of exercising
        their optionholdings which were due to expire at 30 June 2009.
(2)     Mr Steyn has an indirect substantial beneficial interest in these shares and unlisted options. The securities are held in the
        name of Highland Park S.A. and were issued pursuant to a share placement completed in April 2008 which was approved
        by shareholders at a General Meeting.
(3)     During the year, Highland Park acquired 2,333,333 shares from Denison Mines Corp.




                                                                                                   Mantra Resources Annual Report 2009     73
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    19. Related Party Disclosures (Continued)
    (a)     Shareholdings of Key Management Personnel (Continued)
          Key Management              Opening          Purchases          Received                                                    Held at
              Person                 Balance at                          on exercise           Other                                  30 June
               2008                  1 July 2007                          of options          Changes                  Sales           2008
                                          (#)               (#)                 (#)                  (#)                 (#)            (#)
     Directors
     Mr Ian Middlemas                     800,000                 -                   -        320,000(1)                   -         1,120,000
     Mr Robert Behets                     125,833                 -                   -             58,666(1)               -           184,499
     Mr Matthew Yates
                                          166,666                 -                   -             26,666(1)               -           193,332
     (appointed 11 Mar 08)
     Mr Colin Steyn
                                                  -    9,810,486(2)       3,270,163(2)                         -            -        13,080,649
     (appointed 19 Mar 08)
     Mr Mark Pearce                         23,807                -                   -             86,190(1)               -           109,997
     Officer
     Luke Watson
                                            11,320                -                   -              6,666(1)               -            17,986
     (appointed 11 Mar 08)

    Notes
    (1) Issued pursuant to the completion of the merger with Mavuzi Resources Limited as a result of each Key Management
         Personnel’s share and option holdings in Mavuzi, on the same terms and conditions as offered to the public.
    (2)    Mr Steyn has an indirect substantial beneficial interest in these shares and unlisted options. The securities are held in the
           name of Highland Park S.A. and were issued pursuant to a share placement completed in April 2008 which was approved
           by shareholders at a General Meeting held on 17 April 2008.

    (b) Option and Rights Holdings of Key Management Personnel
    The aggregate numbers of options over ordinary shares of the Company held directly, indirectly or beneficially by
    key management personnel of the Company or their related entities at balance date is as follows:

                                Opening                                                                                             Vested and
      Key Management            Balance          Granted as                                                                         exercisable
          Person                at 1 July       compensation          Exercised            Other                   Held at 30        at 30 June
           2009                   2008                (1)                 (2)
                                                                                          Changes                  June 2009            2009
                                    (#)               (#)                 (#)                 (#)                     (#)               (#)
     Directors
     Mr Ian Middlemas             520,000                   -          (520,000)                     -                          -             -
     Mr Robert Behets           1,584,916        1,800,000            (1,084,916)         (600,000) (3)            1,700,000        1,100,000 (5)
     Mr Matthew Yates           1,955,833        1,800,000            (1,955,833)         (600,000) (3)            1,200,000          600,000
     Mr Colin Steyn     (4)
                                4,905,243                   -          (625,000)          625,000                  4,905,243        4,905,243
     Mr Mark Pearce                43,628                   -           (43,628)                     -                          -             -
     Officer
     Mr Luke Watson               377,995                   -          (302,995)                     -                75,000           75,000
     Mr Tony Devlin                        -     2,500,000                       -    (1,000,000)        (3)
                                                                                                                   1,500,000        1,000,000




74 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
19.        Related Party Disclosures (Continued)
(b)        Option and Rights Holdings of Key Management Personnel (Continued)
Notes
(1) The following incentive options were granted to Directors and executives of the Company or Group during the year as part
    of the Company’s remuneration / incentive arrangements:
      •	   Robert Behets:
           - 600,000 $1.65 unlisted options expiring 31 December 2010, vesting 31 March 2010;
           - 600,000 $2.50 unlisted options expiring 30 June 2010, vested 31 December 2008; and
           - 600,000 $3.50 unlisted options expiring 30 June 2011 (note – cancelled in March 2009, refer below for further details).
      •	   Matthew Yates:
           - 600,000 $1.65 unlisted options expiring 31 December 2010, vesting 31 March 2010;
           - 600,000 $2.50 unlisted options expiring 30 June 2010, vested 31 December 2008; and
           - 600,000 $3.50 unlisted options expiring 30 June 2011 (note – cancelled in March 2009, refer below for further details).
      •	   Tony Devlin:
           - 500,000 $1.65 unlisted options expiring 31 December 2010, vesting 31 March 2010;
           - 500,000 $2.50 unlisted options expiring 30 June 2010, vested 31 December 2008;
           - 500,000 $3.00 unlisted options expiring 31 December 2010, vested 28 February 2009;
           - 500,000 $3.50 unlisted options expiring 30 June 2011 (note – cancelled in March 2009, refer below for further details); and
           - 500,000 $4.50 unlisted options expiring 30 September 2011 (note – cancelled in March 2009, refer below for further details).
(2) The following options were exercised by Directors and executives during the year:
      •	   Ian Middlemas:
           - 520,000 $0.20 listed options expiring 30 June 2009.
      •	   Robert Behets:
           - 84,916 $0.20 listed options expiring 30 June 2009;
           - 500,000 $0.20 unlisted options expiring 29 June 2009; and
           - 500,000 $0.25 unlisted options expiring 30 June 2009.
      •	   Matthew Yates:
           - 80,833 $0.20 listed options expiring 30 June 2009;
           - 1,625,000 $0.20 unlisted options expiring 29 June 2009; and
           - 250,000 $0.30 unlisted options expiring 30 June 2010.
      •	   Colin Steyn:
           - 625,000 $0.20 unlisted options expiring 29 June 2009.
      •	   Mark Pearce:
           - 43,628 $0.20 listed options expiring 30 June 2009.
      •	   Luke Watson:
           - 27,995 $0.20 listed options expiring 30 June 2009; and
           - 275,000 $0.20 unlisted options expiring 29 June 2009.
(3) The following incentive options were granted to Directors and executives of the Company or Group during the year, and
      were then subsequently cancelled after each of the individuals agreed to receive reduced cash remuneration packages:
      •	   Robert Behets:
           - 600,000 $3.50 unlisted options expiring 30 June 2011
      •	   Matthew Yates:
           - 600,000 $3.50 unlisted options expiring 30 June 2011
      •	   Tony Devlin:
           - 500,000 $3.50 unlisted options expiring 30 June 2011; and
           - 500,000 $4.50 unlisted options expiring 30 September 2011.
(4) Mr Steyn has an indirect substantial beneficial interest in these options. The securities are held in the name of Highland
      Park S.A. and were issued pursuant to a share placement completed in April 2008 which was approved by shareholders at
      a General Meeting.
      During the year, Highland Park acquired and then exercised 625,000 listed options from Denison Mines Corp.
(5) As at 30 June 2009, Mr Behets also holds 500,000 $0.35 unlisted options expiring 30 June 2010 which were granted to him
      as part of the Company’s IPO in October 2006.




                                                                                                    Mantra Resources Annual Report 2009     75
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    19.      Related Party Disclosures (Continued)
    (b)      Option and Rights Holdings of Key Management Personnel (Continued)
                                   Opening                                                                   Vested and
          Key Management           Balance                                                                   exercisable
              Person               at 1 July  Granted as                                          Held at 30 at 30 June
               2008                  2007    compensation            Exercised      Other Changes June 2008     2008
                                       (#)              (#)              (#)                (#)               (#)             (#)
    Directors
    Mr Ian Middlemas                 400,000                  -                 -          120,000 (1)       520,000         520,000
    Mr Robert Behets               1,562,916                  -                 -           22,000   (1)
                                                                                                           1,584,916       1,584,916
    Mr Matthew Yates
                                   1,533,333                  -                 -          422,500 (1)     1,955,833       1,955,833
    (appointed 11 Mar 08)
    Mr Colin Steyn (2)                        -               -     (3,270,163)         8,175,406 (2)      4,905,243       4,905,243
    Mr Mark Pearce                     11,903                 -                 -           31,725            43,628           43,628
    Officer
    Mr Luke Watson
                                     300,495         75,000                     -            2,500           377,995         302,995
    (appointed 11 Mar 08)
    Notes
    (1)    Issued pursuant to the completion of the merger with Mavuzi Resources Limited as a result of each Key Management
           Personnel’s share and option holdings in Mavuzi, on the same terms and conditions as offered to the public.
    (2)    Mr Steyn has an indirect substantial beneficial interest in these shares and unlisted options. The securities are held in the
           name of Highland Park S.A. and were issued pursuant to a share placement completed in April 2008 which was approved
           by shareholders at a General Meeting held on 17 April 2008.

    Other than Directors, Company Secretary, and Country Manager of Tanzania, there were no Key Management
    Personnel of the Company during the year.

    (c)     Transactions with Related Parties in the Group
    The group consists of Mantra Resources Limited (the parent entity in the wholly owned group) and its controlled
    entities (see Note 21).

    The following loan transactions were entered into during the year within the wholly owned group:

    •	      Mantra Resources Limited advanced $12,755,534 to Mantra Tanzania Limited by way of intercompany loan
            (2008: $6,064,760). The total balance at 30 June 2009 of $20,143,709 has been provided for;

    •	      Mantra Resources Limited advanced $923,424 to OmegaCorp Minerais Limitada by way of intercompany
            loan) (2008: $193,773). The total balance of $923,424 has been provided for; and

    •	      In the prior year, Mavuzi Resources Pty Ltd advanced $7,292,262 to Mantra Resources Limited by way
            of intercompany loan. During the current financial period, Mantra Resources Limited repaid $455,180 to
            Mavuzi Resources Pty Ltd (2008: nil).




76 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
19.      Related Party Disclosures (Continued)
(c)   Transactions with Related Parties in the Group (Continued)
These transactions were undertaken on commercial terms and conditions, except that:
(i)      There is no fixed repayment of the loans; and
(ii)     No interest is payable on the loans prior to the completion of a bankable feasibility study.

The loans to Mantra Tanzania Limited and OmegaCorp Minerais Limitada were fully provided for during the year
ended 30 June 2009.
Loans with controlled entities are also disclosed in Note 14.
Remuneration and equity holdings of Key Management Personnel are disclosed in Notes 18, 19 (a) and (b).

(d)    Other transactions with Related Parties
Apollo Group Pty Ltd, a company of which Mr Mark Pearce is a Director and beneficial shareholder, was paid
$198,000 (2008: $180,000) for the provision of serviced office facilities and administration services during the
year. The amount is based on a monthly retainer due and payable in advance, with no fixed term. Furthermore,
the monthly retainer charged by Apollo Group has been determined on an arms length basis and is considered fair
value. This item has been recognised as an expense in the Income Statement.

20.      Share-Based Payments
The following table illustrates the number and weighted average exercise prices (“WAEP”) of, and movements in,
share options issued as share-based payments during the year:

                                                       2009              2009              2008               2008
                                                      Number             WAEP             Number              WAEP
  Outstanding at beginning of year                   12,900,000          $1.01           8,150,000             $0.21
  Granted by the Company during the year              6,150,000          $2.43           4,000,000             $2.45
  Replacement options issued                                    -              -           500,000             $0.20
  Replacement options issued                                    -              -           250,000             $0.30
  Cancelled by the Company during the year           (2,200,000)         $3.73                     -                 -
  Exercised during the year                          (8,550,000)         $0.21                     -                 -
  Outstanding at end of year                          8,300,000          $2.12         12,900,000              $1.01
  Exercisable at end of year                          5,650,000          $2.04           9,650,000             $0.26

The outstanding balance of options issued as share based payments on issue as at 30 June 2009 is represented by:
•	   650,000 Unlisted Options over ordinary shares with an exercise price of $0.35 each that expire on 30 June 2010;
•	   350,000 Unlisted Options over ordinary shares with an exercise price of $0.90 each that expire on 31 December 2009;
•	   600,000 Unlisted Options over ordinary shares with an exercise price of $1.20 each that expire on 31 December 2010;
•	   2,050,000 Unlisted Options over ordinary shares with an exercise price of $1.65 each that expire on 31 December 2010
     (vesting on 31 March 2010);




                                                                                        Mantra Resources Annual Report 2009   77
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    20.      Share-Based Payments (Continued)
    •	 3,350,000 Unlisted Options over ordinary shares with an exercise price of $2.50 each that expire on 30 June 2010;
    •	 800,000 Unlisted Options over ordinary shares with an exercise price of $3.00 each that expire on 31 December 2010
       (300,000 vesting on 31 December 2009, with the remainder already vested); and
    •	 500,000 Unlisted Options over ordinary shares with an exercise price of $3.50 each that expire on 30 June 2011
       (300,000 vesting on 30 June 2010, with the remainder already vested).

    The remaining contractual lives for the share options outstanding as at 30 June 2009 is between 0.5 and 2.0 years.

    The range of exercise prices for options outstanding at the end of the year was $0.35 to $3.50.

    The weighted average fair value of options granted during the year was $2.43.

    The terms and conditions of the options are disclosed in Note 16(d).

    The fair value of the equity-settled share options granted is estimated as at the date of grant using the Binomial
    option valuation model taking into account the terms and conditions upon which the options were granted.

    The following table lists the inputs to the valuation model used for share options (unlisted) granted by the Company
    during the year ended 30 June 2009:


                         $1.20        $1.65        $1.65        $2.50      $2.50      $3.00        $3.50       $3.50
                        Unlisted     Unlisted     Unlisted     Unlisted   Unlisted   Unlisted     Unlisted    Unlisted
                        Options      Options      Options      Options    Options    Options      Options     Options
    Exercise price        $1.20          $1.65      $1.65        $2.50      $2.50       $3.00       $3.50        $3.50
    Share price on        $0.75          $1.66      $2.70        $0.64      $1.66       $3.77       $0.64        $3.77
    date of grant
    Share price at        $3.77          $3.77      $3.77        $3.77      $3.77       $3.77       $3.77        $3.77
    30 June 2009
    Dividend yield            Nil          Nil         Nil          Nil        Nil         Nil         Nil          Nil
    Volatility               85%           85%         85%          85%        85%        85%          85%         85%
    Risk-free              2.55%         2.68%       3.08%        3.35%      2.68%      4.03%        3.35%       4.03%
    interest rate
    Grant date         30/01/09     12/03/09      29/04/09     28/11/08   12/03/09   30/06/09     28/11/08   30/06/09
    Expiry date        31/12/10     31/12/10      31/12/10     30/06/10   30/06/10   31/12/10     30/06/11    30/06/11
    Expected life of        1.92          1.81        1.67         1.59       1.30       1.50         2.59        2.00
    option (yrs)
    Fair value at         $0.25          $0.74      $1.55       $0.065      $0.43       $1.83      $0.099        $1.86
    grant date
    Number of           250,000      850,000 1,200,000 1,200,000          850,000    300,000 1,200,000        300,000
    options granted
    Vesting date       30/01/09     31/03/10      31/03/10     31/12/08   12/03/09   31/12/09     30/06/10   30/06/10
    Vesting period            Nil         1.04        0.92          0.5        Nil        0.5          1.5         1.0
    (yrs)
    Expensed at              Yes          Yes          Yes          Yes        Yes        Yes          Yes         Yes
    30 June 2009                     (pro-rata)   (pro-rata)                         (pro-rata)               (pro-rata)




78 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
20.    Share-Based Payments (Continued)
8,550,000 of the share options issued as share based payments in prior years were exercised during the year.
It is noted that none of the share options issued as share based payments were forfeited or expired during the year.
However, 1,700,000 $3.50 unlisted options expiring 30 June 2011 and 500,000 $4.50 unlisted options expiring 30
September 2011 that were granted to various Key Management Personnel of the Company during the year were
then subsequently cancelled.

The dividend yield reflects the assumption that the current dividend payout will remain unchanged. The expected
life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur.
The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may
also not necessarily be the actual outcome.

The total share based payment expense recorded by the Group during the year was $7,455,687 (2008: $1,520,200).
All share based payments were accounted for as equity-settled share-based payment transactions.

Refer to Note 25(d) for acquisition of assets by share based payments.

Refer to Note 21 for details of the acquisition of Mavuzi.

21.    Controlled Entities
All controlled entities are included in the consolidated financial statements. The parent entity does not guarantee
to pay the deficiency of its controlled entities in the event of a winding up of any controlled entity. The financial
year-end of the controlled entities is the same as that of the parent entity, except for OmegaCorp Minerais Ltda
which is required by Mozambique law to use a 31 December year-end (note – special purpose IFRS Accounts are
maintained for the purposes of the consolidated financial statements).

                                                                Place of
                                                             Incorporation                    % of Shares held
               Name of controlled entity                                               2009                    2008
 Mantra Tanzania Limited                                        Tanzania               100%                   100%
 Nyanza Goldfields Limited                                      Tanzania               100%                   100%
 Mantra East Africa Limited                                       Kenya                100%                   100%
 Mavuzi Resources Pty Ltd                                       Australia              100%                   100%
 Mavuzi Minerals Pty Ltd                                        Australia              100%                   100%
 OmegaCorp Minerais Ltda                                      Mozambique               100%                   100%
 Mavuzi Holdings Pty Ltd *                                      Australia                 -                   100%
 Mavuzi DRC Pty Ltd *                                           Australia                 -                   100%
 Mavuzi DRC SPRL *                                                 DRC                    -                   100%

The above named investments in controlled entities have a carrying value at balance date of $7,511,304
(2008: $12,811,304) in the Company’s separate financial statements (Refer Note 10).
Notes
* These entities were acquired following the completion of the merger with Mavuzi Resources Ltd in March 2008 and were
  subsequently deregistered during the year ended 30 June 2009. The entities deregistered during the period were dormant and
  accordingly, did not have any impact on the Consolidated Entity’s loss for the period.




                                                                                          Mantra Resources Annual Report 2009   79
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    21.      Controlled Entities (Continued)
    Acquisition of Mavuzi Resources Limited during the Prior Year
    On 11 March 2008, Mantra acquired 100% of the Shares of Mavuzi Resources Limited (‘Mavuzi’) and its wholly
    owned subsidiaries following the completion of a Scheme of Arrangement. In return, the securityholders of Mavuzi
    received the following Mantra securities as Scheme Consideration:
    (i)     Shares – 1 Mantra fully paid share for every 3 Mavuzi fully paid shares; and
    (ii)    Listed options – 1 Mantra $0.20 listed option for every 4 Mavuzi $0.20 listed options.
    It is noted that Mavuzi’s unlisted optionholders also received 1 Mantra unlisted option for every 4 Mavuzi unlisted
    options they held, broadly on the same terms and conditions as the Mavuzi unlisted options. The unlisted options
    were swapped pursuant to a private treaty between Mantra and each of the Mavuzi unlisted optionholders. In
    accordance with the relevant accounting standards, the replacement unlisted options have not been expensed.
    The acquisition of Mavuzi Resources and its wholly owned subsidiaries is analysed as follows (as required by
    AASB 3 – Business Combinations):



                                                                                           $                $
      Consideration
      Shares
      18,267,169 valued at $1.90 each using the mark-to-market method                                    34,707,621
      Listed Options
      6,273,141 valued at $1.50 each using the mark-to-market method                                      9,409,712
                                                                                                         44,117,333
      Net Assets Acquired
      Cash (net cash inflow from the acquisition)                                                         8,244,655
      Accrued interest                                                                                       73,922
      Other current assets                                                                                   73,882
      Property, plant & equipment (net of depreciation)                                                     270,386
      Exploration assets (Mavuzi’s carrying value)                                          292,822
      Revaluation of exploration assets to fair value per
      Scheme Booklet’s Valuation                                                           5,007,178      5,300,000
      Accounts payable                                                                                     (359,775)
      Borrowings                                                                                           (740,380)
      Other payables                                                                                        (29,360)
      Provisions                                                                                            (22,026)
      Fair value of net assets acquired                                                                  12,811,304
      Excess of consideration over fair value of assets acquired (Goodwill)                              31,306,029
                                                                                                         44,117,333




80 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
21.       Controlled Entities (Continued)
Acquisition of Mavuzi Resources Limited during the Prior Year (Continued)
None of the Scheme consideration was discharged by means of cash or cash equivalents.

The carrying amount of goodwill at the balance sheet date was nil (2008: nil) after an impairment loss of $5,300,000
(2008: $31,306,029) was recognised during the current financial year following the acquisition of Mavuzi in March
2008. It is noted that these impairment losses are an estimate and that a number of assumptions were used to
determine the amount of goodwill actually purchased and impaired. In particular, the valuation assigned to the
Mozambique exploration assets of $5.3 million which was fully impaired in the Company’s accounts during the
current financial period is based on an independent expert’s valuation that was included in the Scheme Booklet in
relation to the merger.

The operating loss of the acquired entities (Mavuzi Resources Pty Ltd and its controlled entities) from 11 March
2008 to 30 June 2008 was $638,543. The operating loss of the acquired entities (Mavuzi Resources Pty Ltd and its
controlled entities) for the year ended 30 June 2008 was $3,021,579.

It is noted that the Consolidated Entity’s investment in Mavuzi is carried at nil value (refer Note 10).

                                                               Consolidated                    Company
                                                            2009           2008           2009             2008
                                                              $              $              $                $
 22.     Remuneration Of Auditors
 Amounts received or due and receivable by
 Deloitte Touche Tohmatsu for:
      - an audit or review of the financial reports of
                                                           31,500         28,350         31,500          28,350
      the Company
      - other services in relation to the Company                  -              -              -                -
 Total Auditors’ Remuneration                              31,500         28,350         31,500          28,350

In addition to the amounts noted above, PwC in Tanzania will be paid approximately US $18,000 to audit Mantra Tanzania
Limited’s financial report for the year ended 30 June 2009 and KPMG in Mozambique will be paid approximately US
$11,000 to audit OmegaCorp Minerais Limitada’s financial report for the year ended 30 June 2009.

23.     Segment Information
The Consolidated Entity operates in one business segment and one geographical segment, being mineral
exploration in Africa.




                                                                                       Mantra Resources Annual Report 2009   81
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    24.    Earnings Per Share
                                                                                     Consolidated
                                                                              2009                2008
                                                                         Cents per Share     Cents per Share
     Basic loss per share (cents)                                               (36.86)              (77.64)
     Diluted loss per share (cents)                                             (36.86)              (77.64)


     The following reflects the income and share data used in the
     calculations of basic and diluted earnings per share:
     Net loss used in calculating basic and diluted earnings per share     (30,133,817)        (41,521,094)


                                                                         Number of Shares   Number of Shares
                                                                              2009               2008
     Weighted average number of ordinary shares used in calculating
                                                                            81,754,911          53,479,845
     basic earnings per share
     Effect of dilutive securities*                                                   -                    -
     Adjusted weighted average number of ordinary shares used in
                                                                            81,754,911          53,479,845
     calculating diluted earnings per share

    *Non-dilutive securities

    As at balance date, 14,300,000 (2008: 19,400,000) unlisted options were considered not dilutive as they would
    decrease the loss per share for the year ended 30 June 2009.

    Conversions, calls, subscriptions or issues after 30 June 2009

    Since 30 June 2009, the Company has issued 200,000 shares after acquiring the remaining 15% interest in the
    Mkuju River South Joint Venture, thereby moving to 100% ownership of the entire Mkuju River Project.




82 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
                                                                 Consolidated                         Company
                                                              2009         2008                2009              2008
                                                                $            $                   $                 $
 25.    Cash Flow Statement
 (a)					Reconciliation	of	Loss	from	Continuing	
         Operations	after	Income	Tax	to	Net	Cash	Outflow	
         from Operating Activities
Loss from continuing operations after income tax            (30,133,817) (41,521,094)      (29,831,157)       (41,658,245)
Adjustment for non-cash income
and expense items
Provision for employee entitlements                             33,038        87,128             12,419             49,793
Provision for payroll tax                                       86,983              -            86,983                    -
Depreciation                                                   305,908       172,836               4,230            17,892
Provision for non-recovery of intercompany loan                       -             -       13,678,958          7,388,176
Share based payments expensed                                7,455,687      1,520,200        7,455,687          1,520,200
Impairment loss on acquisition of Mavuzi                              -    31,306,029                   -                  -
Provision for impairment of investment                                -             -        5,300,000        31,306,029
Provision for impairment of exploration assets               7,795,046              -        2,090,741                     -
Foreign exchange (gain)/loss                                    (32,985)     637,936                    -                  -
Foreign exchange movement on cash                                (8,639)      18,925                    -                  -
Changes in assets and liabilities
Decrease/(increase) in trade and other receivables             158,123       (573,512)                  -                  -
Decrease/(increase) in other assets                            161,361          8,473           215,502          (390,862)
Increase/(decrease) in trade and other payables               (727,854)     1,673,881            (74,911)         537,048
Increase in intercompany loan payable                                 -             -                   -                  -
Changes in operating assets and liabilities
                                                                      -      (312,854)                  -                  -
attributable to Mavuzi acquisition
Net cash outflow from operating activities                  (14,907,149)   (6,982,052)       (1,061,548)       (1,229,970)


(b)    Reconciliation of Cash and Cash Equivalents
 Cash at bank and on hand                                      999,034       852,758            978,805           683,052
 Bank short term deposits                                   25,117,098     34,210,921       25,108,656        34,180,921
                                                            26,116,132     35,063,679       26,087,461        34,863,973

(c)    Credit Standby Arrangements with Banks
At balance date, the Company had no used or unused financing facilities.




                                                                                         Mantra Resources Annual Report 2009   83
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    25.     Cash Flow Statement (Continued)
    (d)     Non-cash Financing and Investment Activities
    (1)   30 June 2009
    During the year ended 30 June 2009, the Company completed one investment transaction that involved the issue
    of options as consideration. A summary of this transaction is provided below:

    •	     On 30 January 2009, the Company issued 250,000 unlisted options exercisable at $1.20 each, expiring on 31
           December 2010 as consideration in relation to the termination of Denison Mines Corp’s rights under the Joint
           Venture Agreement (including the uranium rights for the Meponda and Mavuzi Projects and the exploration
           rights to the Zambezi Valley Project in Mozambique) and the Strategic Alliance Agreement. The options were
           valued at $62,500 and immediately expensed in accordance with the relevant accounting standards.

    (2)  30 June 2008
    During the year ended 30 June 2008, the Company completed a number of transactions that involved the issue of
    shares as consideration. A summary of these transactions is provided below:

    (i)    Merger with Mavuzi Resources Limited – refer Note 21.
    (ii)   Malawi Joint Ventures:
           During the year, the Company acquired a 90% interest in the Chikangawa and Chintheche Projects located
           in Malawi.


                                                                                                         $
      Consideration                                                                                  690,000
      Net Assets Acquired
      Exploration and evaluation assets                                                              690,000
      Fair value of net assets                                                                       690,000
      Excess of consideration over fair value of assets acquired                                             -
      Non Cash Consideration
      600,000 fully paid ordinary shares (valued at $1.15 each)                                      690,000
      Net Cash Outflow Upon Acquisition (share issue costs)                                           (3,283)




84 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
26.     Financial Instruments
(a)    Overview
The Group’s principal financial instruments comprise receivables, payables, cash and short-term deposits.
The main risks arising from the Group’s financial instruments are interest rate risk, foreign currency risk, credit risk
and liquidity risk.

This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and
processes for measuring and managing risk, and the management of capital. Other than as disclosed, there have
been no significant changes since the previous financial year to the exposure or management of these risks.

The Group manages its exposure to key financial risks in accordance with the Group’s financial risk management
policy. Key risks are monitored and reviewed as circumstances change (e.g. acquisition of a new project) and
policies are revised as required. The overall objective of the Group’s financial risk management policy is to support
the delivery of the Group’s financial targets whilst protecting future financial security.

Given the nature and size of the business and uncertainty as to the timing and amount of cash inflows and outflows,
the Group does not enter into derivative transactions to mitigate the financial risks. In addition, the Group’s policy
is that no trading in financial instruments shall be undertaken for the purposes of making speculative gains. As the
Group’s operations change, the Directors will review this policy periodically going forward.

The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
The Board reviews and agrees policies for managing the Group’s financial risks as summarised below.

(b)   Interest Rate Risk Exposure
The Group’s exposure to the risk of changes in market interest rates relates primarily to the cash and short-term
deposits with a floating interest rate.

These financial assets with variable rates expose the Group to cash flow interest rate risk. All other financial assets
and liabilities, in the form of receivables and payables are non-interest bearing.

The Group and the Company’s exposure to interest rate risk and the effective weighted average interest rate for
each class of financial assets and financial liabilities is set out below:

                                                               Weighted Average Effective                Floating
                                                                      Interest Rate                   Interest Rate
                      Consolidated                                          %                               $
 2009
 Financial Assets
 Cash and deposits                                                         3.04%                      26,116,132
 Other financial assets                                                      Nil                          202,362
 Total Financial Assets                                                                               26,318,494
 2008
 Financial Assets
 Cash and deposits                                                         7.27%                      35,063,679
 Other financial assets                                                    7.00%                          312,012
 Total Financial Assets                                                                               35,375,691




                                                                                       Mantra Resources Annual Report 2009   85
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    26.     Financial Instruments (Continued)
    (b)     Interest Rate Risk Exposure (Continued)
                                                                      Weighted Average Effective                  Floating
                                                                            Interest Rate                      Interest Rate
                            Company                                                  %                                $
     2009
     Cash and deposits                                                             3.04%                        26,087,461
     2008
     Cash and deposits                                                             7.29%                        34,863,973

    The Group’s cash at bank and on hand and short term deposits had a weighted average floating interest rate at
    year end of 3.04% (2008: 7.27%).

    The Group currently does not engage in any hedging or derivative transactions to manage interest rate risk.

    Cash flow sensitivity analysis for variable rate instruments

    A sensitivity of 10% has been selected as this is considered reasonable given the current level of both short term
    and long term interest rates. An increase of 10% in the interest rates at the reporting date would have increased
    (decreased) equity and profit and loss by the amounts shown below. This analysis assumes that all other variables,
    in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2008.

                                                                 Profit or Loss                             Equity
                                                             10%               10%                 10%               10%
                                                           Increase          Decrease            Increase          Decrease
                                                               $                $                    $                $
     2009
     Group
     Cash and cash equivalents                              79,376            (79,376)            79,376             (79,376)
     Company
     Cash and cash equivalents                               79,376           (79,376)            79,376             (79,376)
     2008
     Group
     Cash and cash equivalents                             255,063          (255,063)            255,063          (255,063)
     Company
     Cash and cash equivalents                             254,208          (254,208)            254,208          (254,208)

    It is noted that the analysis shown above is not representative of the risks faced by the Company throughout the
    period because interest rates and cash balances have changed significantly during the year.

    (c)   Net	Fair	Value	of	Financial	Assets	and	Liabilities
    The net fair value of cash, cash equivalents and financial assets and financial liabilities approximates their carrying value.




86 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
26.    Financial Instruments (Continued)
(d)    Credit Risk Exposure
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails
to meet its contractual obligations. This arises principally from cash and cash equivalents and trade and other
receivables and in the Company includes loans to controlled entities.

The carrying amount of the Group’s financial assets represents the maximum credit risk exposure, as represented below:

                                                                   Consolidated                      Company
                                                                 2009          2008              2009            2008
                                                                   $             $                 $               $
 Financial Assets
 Cash and cash equivalents                                   26,116,132     35,063,679     26,087,461         34,863,973
 Trade and other receivables and other financial assets         774,858      1,142,478           224,078         439,580
 Loan to controlled entity                                              -              -                -                -
                                                             26,890,990     36,206,157     26,311,539         35,303,553

The Group does not have any significant customers and accordingly does not have any significant exposure to bad
or doubtful debts.

Trade and other receivables includes GST/VAT refunds receivable. Where possible the Group trades only with
recognised, creditworthy third parties. It is the Group’s policy that all customers who wish to trade on credit terms
are subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis
with the result that the Group’s exposure to bad debts is not significant. None of the Group’s receivables at 30 June
2009 or 2008 are past due. No impairment losses have been recognised.

The Company’s accounts include receivables from controlled entities for which full provisions for non-recovery
have been made. Provision is made against loans to controlled entities where the underlying exploration assets
have been fully provided for or written off. The provision is reconciled below:

                                                                                      2009                    2008
       Receivables from Controlled Entities Impairment Provision                        $                       $
 Opening balance                                                                                 -         1,323,415
 Add: Movement in balance of loan receivable (current period)                     13,678,958                6,064,761
 Balance at 30 June                                                               13,678,958                7,388,176
 Less: Provision for non-recovery of receivables from controlled entities         (13,678,958)          (7,388,176)
                                                                                             -                       -

With respect to credit risk arising from cash and cash equivalents, the Group’s exposure to credit risk arises from
default of the counter party, with a maximum exposure equal to the carrying amount of these instruments. The
parent entity’s cash and cash equivalents are held with the ANZ Bank which is an Australian bank with a AA credit
rating (Standard & Poor’s).




                                                                                      Mantra Resources Annual Report 2009    87
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    26.    Financial Instruments (Continued)
    (e)   Foreign Currency Risk
    The Group also has transactional currency exposures. Such exposure arises from transactions denominated in
    currencies other than the functional currency of the entity.

    The Group currently does not engage in any hedging or derivative transactions to manage foreign currency risk.

    The Group’s exposure to foreign currency risk throughout the current and prior year primarily arose from certain
    controlled entities of the Company with functional currencies other than AUD having foreign currency exposure in
    relation to intercompany loans which are denominated in Australian dollars. In the Group accounts, the exchange
    movements on these loans are taken to the foreign currency translation reserve. As noted above, these loans are
    fully provided for and accordingly, the carrying value of these loans at balance date is nil (2008: nil).

    (f)     Commodity risk
    The Group is exposed to commodity price risk. These commodity prices can be volatile and are influenced by
    factors beyond the Group’s control. As the Group is currently engaged in exploration and business development
    activities, no sales of commodity products are forecast for the next 12 months, and accordingly, no hedging or
    derivative transactions have been used to manage price risk.

    (g)    Capital management
    The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence
    and to sustain future development of the business. Given the stage of development of the Group, the Board’s
    objective is to minimise debt and to raise funds as required through the issue of new shares. The Group is currently
    examining new business opportunities, where acquisition/working capital requirements of a new project may involve
    additional funding in some format.

    There were no changes in the Group’s approach to capital management during the year.

    The Group is not subject to externally imposed capital requirements.

    (h)     Liquidity	risk
    Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Board’s
    approach to managing liquidity is to ensure, as far as possible, that the Group will always have sufficient liquidity
    to meet its liabilities when due. As at 30 June 2009 and 2008, the Group has sufficient liquid assets to meet its
    financial obligations.




88 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
26.     Financial Instruments (Continued)
(h)		   Liquidity	risk	(Continued)

                                                    6 - 12
                   2009               ≤ 6 months   months    1 - 5 years      ≥ 5 years            Total
                                           $          $            $              $                  $
 2009
 Group
 Financial Liabilities
 Trade and other payables              1,815,237      -           -                 -           1,815,237
 Borrowings                              740,380      -           -                 -             740,380
                                       2,555,617      -           -                 -           2,555,617
 Company
 Financial Liabilities
 Trade and other payables                773,275      -           -                 -             773,275
 Borrowings                            6,837,082      -           -                 -           6,837,082
                                       7,610,357      -           -                 -           7,610,357
 2008
 Group
 Financial Liabilities
 Trade and other payables              2,305,009      -           -                 -           2,305,009
 Borrowings                              740,380      -           -                 -             740,380
                                       3,045,389      -           -                 -           3,045,389
 Company
 Financial Liabilities
 Trade and other payables                670,590      -           -                 -             670,590
 Borrowings                            7,292,262      -           -                 -           7,292,262
                                       7,962,852      -           -                 -           7,962,852




                                                                           Mantra Resources Annual Report 2009   89
    Notes to and Forming Part of the Financial Statements

    For the Year Ended 30 June 2009
    27.     Interest In Joint Ventures (Jointly Controlled Assets)
                                                                                      Interest at               Interest at
                Joint Venture                            Activity                    30 June 2009              30 June 2008
     Tanzania
     Mkuju River South JV                         Uranium Exploration                     85%                       85%
     Southern Tanzania JV #1                      Uranium Exploration                     90%                       90%
     Southern Tanzania JV #2                      Uranium Exploration                     95%                       95%
     Mbamba Bay JV                                Uranium Exploration                     90%                       90%
     Central Tanzania JV                          Uranium Exploration                     95%                       95%
     Liwale JV                                    Uranium Exploration                     95%                       95%
     Malawi (1)
     Chikangawa/Chintheche                        Uranium Exploration                       -                       90%
     Nanzeka (uranium rights)                     Uranium Exploration                       -                       51%

    Notes
    (1)     During the year the Company elected to withdraw from its Malawi Projects due to insufficient encouragement from the
            exploration results obtained. Under the terms of the JV agreements, Mantra transferred its interests in the exploration
            properties to its JV partners for no consideration. The Company has now completely withdrawn from Malawi and no
            longer holds any interests in exploration properties in that country.

    Net assets employed in the joint ventures totalling $2,379,497 (2008: $2,270,148) previously included as exploration
    and evaluation assets in the Consolidated Entity’s Balance Sheet were fully impaired during the current financial
    period (refer Note 9 for further details).

    Net assets employed in the joint ventures totalling $2,090,741 (2008: $2,090,741) previously included as exploration
    and evaluation assets in the Company’s Balance Sheet were fully impaired during the current financial period.

                                                                          Consolidated                      Company
                                                                        2009        2008                2009       2008
                                                                          $           $                   $          $
    28.     Commitments For Expenditure
    Not longer than 1 year                                                 -          374,415             -               -
    Longer than 1 year and not longer than 5 years                         -                    -         -               -
                                                                           -          374,415             -               -

    29.     Contingent Liabilities
    As at 30 June 2009 and 30 June 2008, the Company did not have any contingent liabilities.




90 Mantra Resources Annual Report 2009
Notes to and Forming Part of the Financial Statements

For the Year Ended 30 June 2009
30.   Subsequent Events
•	    On 24 July 2009, the Company entered into an Agreement to divest its non-core Projects in Mozambique
      (Niassa, Mavuzi, Mucumbura, Murrupula and Zumbu Projects) to North River Resources Plc (‘NRR’), a
      company listed on London’s AIM Market. Consideration for the properties was US $100,000, plus 10 million
      shares in NRR. The issue of the shares to Mantra was approved by NRR’s shareholders at a General
      Meeting held in late August 2009.

•	    On 18 August 2009, the Company announced that it had moved to 100% ownership of the entire MRP by
      acquiring the remaining 15% interest in the Mkuju River South Joint Venture. The JV Property is approximately
      1,800km2, comprises ten tenement areas, and covers the southern portion of the Company’s flagship MRP
      in southern Tanzania.

      It is noted that the northern half of the MRP, which includes the Nyota Prospect that hosts an initial Inferred
      Mineral Resource estimate of 35.9 million pounds U3O8 (39.9 million tonnes at 409 ppm, using a 200 ppm
      lower cut-off grade), was already 100% wholly owned by Mantra.

      The acquisition price of the remaining 15% interest in the Property was 200,000 fully paid ordinary shares
      in Mantra.

Other than as disclosed above, there were no significant events occurring after balance date requiring disclosure.




                                                                                    Mantra Resources Annual Report 2009   91
    Directors’ Declaration

    In accordance with a resolution of the Directors of Mantra Resources Limited, I state that:
    (1)       In the opinion of the Directors:

            (a)     the financial statements, notes and the additional disclosures included in the directors’ report
                    designated as audited of the Company and of the Consolidated Entity are in accordance with the
                    Corporations Act 2001 including:

                    (i) giving a true and fair view of the Company’s and Consolidated Entity’s financial position as at 30
                        June 2009 and of their performance for the year ended on that date; and

                    (ii) complying with accounting standards and the Corporations Act 2001; and

            (b)     there are reasonable grounds to believe that the Company and the Consolidated Entity will be able to
                    pay its debts as and when they become due and payable.

    (2)     The Directors have been given a declaration required by section 295A of the Corporations Act 2001 for the
            financial year ended 30 June 2009.




    On behalf of the Board.




    ROBERT BEHETS
    Joint Managing Director




    14 September 2009




92 Mantra Resources Annual Report 2009
Independent Auditor’s Report
                                                                                        Deloitte Touche Tohmatsu
                                                                                        ABN 74 490 121 060
                                                                                        Woodside Plaza
                                                                                        Level 14
                                                                                        240 St Georges Terrace

Independent Auditor’s Report to the
                                                                                        Perth WA 6000
                                                                                        GPO Box A46

Members of Mantra Resources Limited
                                                                                        Perth WA 6837 Australia
                                                                                        DX 206
                                                                                        Tel: +61 (0) 8 9365 7000
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                                                                                        www.deloitte.com.au
Report on the Financial Report

We have audited the accompanying financial report of Mantra Resources Limited, which comprises the
balance sheet as at 30 June 2009, and the income statement, cash flow statement and statement of changes in
equity for the year ended on that date, a summary of significant accounting policies, other explanatory notes
and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled
at the year’s end or from time to time during the financial year as set out on pages 41 to 92.


Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation and fair presentation of the financial report
in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations)
and the Corporations Act 2001. This responsibility includes establishing and maintaining internal control
relevant to the preparation and fair presentation of the financial report that is free from material misstatement,
whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting
estimates that are reasonable in the circumstances. In Note 1, the directors also state, in accordance with
Accounting Standard AASB 101 Presentation of Financial Statements, that compliance with the Australian
equivalents to International Financial Reporting Standards ensures that the financial report, comprising the
financial statements and notes, complies with International Financial Reporting Standards.

Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply
with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance whether the financial report is free from material misstatement.


An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor’s judgement, including the assessment of
the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation
of the financial report in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the directors, as well as evaluating the overall presentation of the financial report.


We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.



Liability limited by a scheme approved under Professional Standards Legislation.


                                                                                   Mantra Resources Annual Report 2009   93
    Independent Auditor’s Report



    Auditor’s Independence Declaration

    In conducting our audit, we have complied with the independence requirements of the Corporations Act
    2001.


    Auditor’s Opinion

    In our opinion:

    (a) the financial report of Mantra Resources Limited is in accordance with the Corporations Act 2001, including:

        (i) giving a true and fair view of the company’s and consolidated entity’s financial position as at 30 June 2009 and of
            their performance for the year ended on that date; and

        (ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the
             Corporations Regulations 2001; and

    (b) the financial statements and notes also comply with International Financial Reporting Standards as disclosed in Note 1.

    Report on the Remuneration Report

    We have audited the Remuneration Report included in pages 31 to 38 of the directors’ report for the year ended 30 June 2009.
    The directors of the company are responsible for the preparation and presentation of the Remuneration Report in accordance
    with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report,
    based on our audit conducted in accordance with Australian Auditing Standards.

    Auditor’s Opinion

    In our opinion the Remuneration Report of Mantra Resources Limited for the year ended 30 June 2009, complies with section
    300A of the Corporations Act 2001.




    DELOITTE TOUCHE TOHMATSU




    A T Richards

    Partner

    Chartered Accountants

    Perth, 14 September 2009




94 Mantra Resources Annual Report 2009
Corporate Governance                                            96
Additional Information                                         104




                         Mantra Resources Annual Report 2009   95
    Corporate Governance Statement

    The Board of Directors of Mantra Resources Limited is responsible for its corporate governance, that is, the system
    by which the Group is managed.

    1.     Board of Directors
    1.1    Role of the Board and Management
    The Board represents shareholders’ interests in continuing a successful business, which seeks to optimise medium
    to long-term financial gains for shareholders. By not focusing on short-term gains for shareholders, the Board
    believes that this will ultimately result in the interests of all stakeholders being appropriately addressed when
    making business decisions.

    The Board is responsible for ensuring that the Group is managed in such a way to best achieve this desired result.
    Given the current size and operations of the business, the Board currently undertakes an active, not passive role.

    The Board is responsible for evaluating and setting the strategic directions for the Group, establishing goals for
    management and monitoring the achievement of these goals. The Joint Managing Directors are responsible to the
    Board for the day-to-day management of the Group.

    The Board has sole responsibility for the following:

    •	   Appointing and removing the Joint Managing Directors and any other executives and approving
         their remuneration;
    •	   Appointing and removing the Company Secretary / Chief Financial Officer and approving their remuneration;
    •	   Determining the strategic direction of the Group and measuring performance of management against
         approved strategies;
    •	   Review of the adequacy of resources for management to properly carry out approved strategies and
         business plans;
    •	   Adopting operating and capital expenditure budgets at the commencement of each financial year and
         monitoring the progress by both financial and non-financial key performance indicators;
    •	   Monitoring the Group’s medium term capital and cash flow requirements;
    •	   Approving and monitoring financial and other reporting to regulatory bodies, shareholders and
         other organisations;
    •	   Determining that satisfactory arrangements are in place for auditing the Group’s financial affairs;
    •	   Review and ratify systems of risk management and internal compliance and control, codes of conduct and
         compliance with legislative requirements; and
    •	   Ensuring that policies and compliance systems consistent with the Group’s objectives and best practice are in
         place and that the Company and its officers act legally, ethically and responsibly on all matters.
    The Board’s role and the Group’s corporate governance practices are being continually reviewed and improved
    as required.

    1.2   Composition of the Board and New Appointments
    The Company currently has the following Board members:

     Mr Ian Middlemas             Non-Executive Chairman
     Mr Robert Behets             Joint Managing Director
     Mr Matthew Yates             Joint Managing Director
     Mr Colin Steyn               Non-Executive Director
     Mr Mark Pearce               Non-Executive Director

    Details of the directors, including their qualifications, experience and date of appointment are set out in the
    Directors’ Report.




96 Mantra Resources Annual Report 2009
Corporate Governance Statement

1.     Board of Directors (Continued)
1.2    Composition of the Board and New Appointments (Continued)
The Company’s Constitution provides that the number of directors shall not be less than three and not more than
ten. There is no requirement for any share holding qualification.

The Board has assessed the independence status of the directors and has determined that there are three
independent directors, being Messers Middlemas, Steyn and Pearce.

The Board has followed the ASX Corporate Governance Principles and Recommendations when assessing the
independence of the directors which define an independent director to be a director who:

•	   is non-executive;
•	   is not a substantial shareholder (i.e. greater than 5%) of the Company or an officer of, or otherwise associated,
     directly or indirectly, with a substantial shareholder of the Company;
•	   has not within the last three years been employed in an executive capacity by the Company or another Group
     member, or been a director after ceasing to hold such employment;
•	   within the last three years has not been a principal or employee of a material professional adviser or a material
     consultant to the Company or another Group member;
•	   is not a significant supplier or customer of the Company or another Group member, or an officer of or otherwise
     associated, directly or indirectly, with a significant supplier or customer;
•	   has no material contractual relationship with the Company or another Group member other than as a director
     of the Company; and
•	   is free from any interest and any business or other relationship which could, or could reasonably be perceived
     to, materially interfere with the director’s ability to act in the best interests of the Company.
Materiality for these purposes is determined on both quantitative and qualitative bases. An amount which is greater
than five percent of either the net assets of the Company or an individual director’s net worth is considered material
for these purposes.

Highland Park S.A., a company associated with Mr Steyn, is a substantial shareholder of the Company (as defined
in section 9 of the Corporations Act). However, considering Mr Steyn’s interest in Highland Park S.A. is merely a
relevant interest and the fact that Mr Steyn is not involved in the day-to-day management of the Company, the
Board considers that this relationship is not material or significant enough to impact the independent judgment of
Mr Steyn.

Apollo Group Pty Ltd, a company associated with Mr. Pearce, is paid a monthly retainer to provide administrative
services, company secretarial services, accounting services and a fully serviced office to the Company. The
Board considers that this relationship is not material or significant enough to impact the independent judgment of
Mr. Pearce.

If the Group’s activities increase in size, nature and scope, the size of the Board will be reviewed periodically and
the optimum number of directors required for the Board to properly perform its responsibilities and functions will
be appointed.

The membership of the Board, its activities and composition is subject to periodic review. The criteria for determining
the identification and appointment of a suitable candidate for the Board shall include quality of the individual,
background of experience and achievement, compatibility with other Board members, credibility within the Group’s
scope of activities, intellectual ability to contribute to the Board’s duties and physical ability to undertake the Board’s
duties and responsibilities.

Directors are initially appointed by the full Board subject to election by shareholders at the next annual general
meeting. Under the Company’s Constitution the tenure of directors (other than managing director, and only one
managing director where the position is jointly held) is subject to reappointment by shareholders not later than the
third anniversary following his last appointment. Subject to the requirements of the Corporations Act 2001, the
Board does not subscribe to the principle of retirement age and there is no maximum period of service as a director.
A managing director may be appointed for any period and on any terms the directors think fit and, subject to the
terms of any agreement entered into, the Board may revoke any appointment.




                                                                                         Mantra Resources Annual Report 2009   97
    Corporate Governance Statement

    1.     Board of Directors (Continued)
    1.3    Committees of the Board
    Other than the recent formation of an Audit Committee, the Board considers that the Company is not currently of
    a size, nor are its affairs of such complexity to justify the formation of separate or special committees at this time.
    The Board as a whole is able to address the governance aspects of the full scope of the Company’s activities and
    to ensure that it adheres to appropriate ethical standards.

    The Board has also established a framework for the management of the Group including a system of internal
    controls, a business risk management process and the establishment of appropriate ethical standards.

    The full Board currently holds meetings at such times as may be necessary to address any general or specific
    matters as required.

    If the Group’s activities increase in size, scope and nature, the appointment of separate or special committees will
    be reviewed by the Board and implemented if appropriate.

    1.4		 Conflicts	of	Interest
    In accordance with the Corporations Act and the Company’s Constitution, Directors must keep the Board advised,
    on an ongoing basis, of any interest that could potentially conflict with those of the Group. Where the Board
    believes that a significant conflict exists the Director concerned does not receive the relevant board papers and is
    not present at the meeting whilst the item is considered.

    1.5    Independent Professional Advice
    The Board has determined that individual Directors have the right in connection with their duties and responsibilities
    as Directors, to seek independent professional advice at the Company’s expense. The engagement of an outside
    adviser is subject to prior approval of the Chairman and this will not be withheld unreasonably. If appropriate, any
    advice so received will be made available to all Board members.

    2.     Ethical Standards
    The Board acknowledges the need for continued maintenance of the highest standard of corporate governance
    practice and ethical conduct by all Directors and employees of the Group.

    2.1    Code of Conduct for Directors
    The Board has adopted a Code of Conduct for Directors to promote ethical and responsible decision-making by
    the Directors. The code is based on a code of conduct for Directors prepared by the Australian Institute of
    Company Directors.

    The principles of the code are:

    •	   A director must act honestly, in good faith and in the best interests of the company as a whole.
    •	   A director has a duty to use due care and diligence in fulfilling the functions of office and exercising the powers
         attached to that office.
    •	   A director must use the powers of office for a proper purpose, in the best interests of the company as
         a whole.
    •	   A director must recognise that the primary responsibility is to the Company’s shareholders as a whole but
         should, where appropriate, have regard for the interest of all stakeholders of the company.
    •	   A director must not make improper use of information acquired as a director.
    •	   A director must not take improper advantage of the position of director.
    •	   A director must not allow personal interests, or the interests of any associated person, to conflict with the
         interests of the company.
    •	   A director has an obligation to be independent in judgment and actions and to take all reasonable steps to be
         satisfied as to the soundness of all decisions taken as a Board.




98 Mantra Resources Annual Report 2009
Corporate Governance Statement

2.     Ethical Standards (Continued)
2.1     Code of Conduct for Directors (Continued)
•	    Confidential information received by a director in the course of the exercise of directorial duties remains the
      property of the Company and it is improper to disclose it, or allow it to be disclosed, unless that disclosure
      has been authorised by the Company, or the person from whom the information is provided, or is required
      by law.
•	    A director should not engage in conduct likely to bring discredit upon the company.
•	    A director has an obligation at all times, to comply with the spirit, as well as the letter of the law and with the
      principles of the Code.
The principles are supported by guidelines as set out by the Australian Institute of Company Directors for
their interpretation. Directors are also obliged to comply with the Company’s Code of Ethics and Conduct, as
outlined below.

2.2     Code of Ethics and Conduct
The Group has implemented a Code of Ethics and Conduct, which provides guidelines aimed at maintaining high
ethical standards, corporate behaviour and accountability within the Group.

All employees and directors are expected to:

•	    respect the law and act in accordance with it;
•	    respect confidentiality and not misuse Group information, assets or facilities;
•	    value and maintain professionalism;
•	    avoid real or perceived conflicts of interest;
•	    act in the best interests of shareholders;
•	    by their actions contribute to the Group’s reputation as a good corporate citizen which seeks the respect of
      the community and environment in which it operates;
•	    perform their duties in ways that minimise environmental impacts and maximise workplace safety;
•	    exercise fairness, courtesy, respect, consideration and sensitivity in all dealings within their workplace and
      with customers, suppliers and the public generally; and
•	    act with honesty, integrity, decency and responsibility at all times.
An employee that breaches the Code of Ethics and Conduct may face disciplinary action. If an employee suspects
that a breach of the Code of Ethics and Conduct has occurred or will occur, he or she must report that breach
to management. No employee will be disadvantaged or prejudiced if he or she reports in good faith a suspected
breach. All reports will be acted upon and kept confidential.

2.3     Dealings in Company Securities
The Company’s share trading policy imposes basic trading restrictions on all employees of the Company with
‘inside information’, and additional trading restrictions on the directors of the Company.

‘Inside information’ is information that:

•	    is not generally available; and
•	    if it were generally available, it would, or would be likely to influence investors in deciding whether to buy or
      sell the Company’s securities.
If an employee possesses inside information, the person must not:

•	    trade in the Company’s securities;
•	    advise others or procure others to trade in the Company’s securities; or
•	    pass on the inside information to others – including colleagues, family or friends – knowing (or where the
      employee or Director should have reasonably known) that the other persons will use that information to trade
      in, or procure someone else to trade in, the Company’s securities.



                                                                                        Mantra Resources Annual Report 2009   99
     Corporate Governance Statement

     2.     Ethical Standards (Continued)
     2.3    Dealings in Company Securities (Continued)
     This prohibition applies regardless of how the employee or Director learns the information (e.g. even if the employee
     or Director overhears it or is told in a social setting).

     In addition to the above, Directors must notify the Company Secretary as soon as practicable, but not later than
     5 business days, after they have bought or sold the Company’s securities or exercised options. In accordance
     with the provisions of the Corporations Act 2001 and the Listing Rules of the ASX, the Company on behalf of the
     Directors must advise the ASX of any transactions conducted by them in the securities of the Company.

     Breaches of this policy will be subject to disciplinary action, which may include termination of employment.

     2.4    Interests of Other Stakeholders
     The Group’s objective is to leverage into resource projects to provide a solid base in the future from which the
     Group can build its resource business and create wealth for shareholders. The Group’s operations are subject to
     various environmental laws and regulations under the relevant government’s legislation. Full compliance with these
     laws and regulations is regarded as a minimum standard for the Group to achieve.

     To assist in meeting its objective, the Group conducts its business within the Code of Ethics and Conduct, as
     outlined in 2.2 above.

     3.     Disclosure of Information
     3.1    Continuous Disclosure to ASX
     The continuous disclosure policy requires all executives and Directors to inform a Joint Managing Director or in
     their absence the Company Secretary of any potentially material information as soon as practicable after they
     become aware of that information.

     Information is material if it is likely that the information would influence investors who commonly acquire securities
     on ASX in deciding whether to buy, sell or hold the Company’s securities.

     Information need not be disclosed if:

     •	   It is not material and a reasonable person would not expect the information to be disclosed, or it is material
          but due to a specific valid commercial reason is not to be disclosed; and
     •	   The information is confidential; or
     •	   One of the following applies:
             i. It would breach a law or regulation to disclose the information;

             ii. The information concerns an incomplete proposal or negotiation;

             iii. The information comprises matters of supposition or is insufficiently definite to warrant disclosure;

             iv. The information is generated for internal management purposes;

             v. The information is a trade secret;

             vi. It would breach a material term of an agreement, to which the Group is a party, to disclose
                 the information;

             vii The information is scientific data that release of which may benefit the Group’s potential competitors.

     The Joint Managing Directors are responsible for interpreting and monitoring the Group’s disclosure policy and
     where necessary informing the Board. The Company Secretary is responsible for all communications with ASX.




100 Mantra Resources Annual Report 2009
Corporate Governance Statement

3.    Disclosure of Information (Continued)
3.2   Communication with Shareholders
The Group places considerable importance on effective communications with shareholders.

The Group’s communication strategy requires communication with shareholders and other stakeholders in an open,
regular and timely manner so that the market has sufficient information to make informed investment decisions on
the operations and results of the Group. The strategy provides for the use of systems that ensure a regular and
timely release of information about the Group is provided to shareholders. Mechanisms employed include:

•	   Announcements lodged with ASX;
•	   ASX Quarterly Cash Flow Reports;
•	   Half Yearly Report;
•	   Presentations at the Annual General Meeting/General Meeting’s; and
•	   Annual Report.
The Board encourages full participation of shareholders at the Annual General Meeting to ensure a high level of
accountability and understanding of the Group’s strategy and goals.

The Group also posts all reports, ASX and media releases and copies of significant business presentations on the
Company’s website.

4.    Risk Management and Internal Control
4.1    Approach to Risk Management and Internal Control
The identification and effective management of risk, including calculated risk-taking, is viewed as an essential part
of the Group’s approach to creating long-term shareholder value.

The Group operates a standardised risk management process that provides a consistent framework for the
identification, assessment, monitoring and management of material business risks. This process is based on the
Australian/New Zealand Standard for Risk Management (AS/NZS 4360 Risk Management) and the Committee
of Sponsoring Organisations of the US Treadway Commission (COSO) control framework for enterprise
risk management.

Strategic and operational risks are reviewed at least annually as part of the annual strategic planning, business
planning, forecasting and budgeting process.

The Group has developed a series of operational risks which the Group believes to be inherent in the industry in
which the Group operates having regard to the Group’s circumstances (including financial resources, prospects
and size). These include:

•	   fluctuations in commodity prices and exchange rates;
•	   accuracy of mineral reserve and resource estimates;
•	   reliance on licenses, permits and approvals from governmental authorities;
•	   ability to obtain additional financing; and
•	   changed operating, market or regulatory environments.
These risk areas are provided here to assist investors to understand better the nature of the risks faced by our
Group and the industry in which the Group operates. They are not necessarily an exhaustive list.

4.2    Risk Management Roles and Responsibilities
Management is responsible for designing, implementing and reporting on the adequacy of the Group’s risk
management and internal control system. Management reports to the Board annually, or more frequently as
required, on the Group’s key risks and the extent to which it believes these risks are being managed.

The Board is responsible for reviewing and approving the Group’s risk management and internal control system
and satisfying itself annually, or more frequently if required, that management has developed and implemented a
sound system of risk management and internal control.



                                                                                     Mantra Resources Annual Report 2009   101
     Corporate Governance Statement

     4.     Risk Management and Internal Control (Continued)
     4.3     Integrity of Financial Reporting
     The Board also receives a written assurance from the Chief Executive Officer or equivalent (CEO) and the Chief
     Financial Officer or equivalent (CFO) that to the best of their knowledge and belief, the declaration provided by
     them in accordance with section 295A of the Corporations Act is founded on a sound system of risk management
     and internal control and that the system is operating effectively in relation to financial reporting risks.

     The Board notes that due to its nature, internal control assurance from the CEO and CFO can only be reasonable
     rather than absolute. This is due to such factors as the need for judgement, the use of testing on a sample basis,
     the inherent limitations in internal control and because much of the evidence available is persuasive rather than
     conclusive and therefore is not and cannot be designed to detect all weaknesses in control procedures.

     4.4    Role of External Auditor
     The Group’s practice is to invite the auditor (who now must attend) to attend the annual general meeting and be
     available to answer shareholder questions about the conduct of the audit and the preparation and content of the
     auditor’s report.

     5.     Performance Review
     The Board has adopted a self-evaluation process to measure its own performance and the performance of its
     committees (if any) during each financial year. Also, an annual review is undertaken in relation to the composition
     and skills mix of the directors of the Company.

     Arrangements put in place by the Board to monitor the performance of the Group’s executives include:

     •	   a review by the Board of the Group’s financial performance;
     •	   annual performance appraisal meetings incorporating analysis of key performance indicators with each
          individual to ensure that the level of reward is aligned with respective responsibilities and individual contributions
          made to the success of the Group;
     •	   an analysis of the Group’s prospects and projects; and
     •	   a review of feedback obtained from third parties, including advisors.
     The Remuneration Report discloses the process for evaluating the performance of senior executives, including the
     Joint Managing Directors.

     6.     Remuneration Arrangements
     The broad remuneration policy is to ensure that remuneration properly reflects the relevant person’s duties and
     responsibilities, and that the remuneration is competitive in attracting, retaining and motivating people of the
     highest quality. The Board believes that the best way to achieve this objective is to provide Executive Directors and
     executives with a remuneration package consisting of fixed components that reflect the person’s responsibilities,
     duties and personal performance.

     In addition to the above, the Group has developed a limited equity-based remuneration arrangement for key
     executives and consultants.

     The remuneration of Non-Executive Directors is determined by the Board as a whole having regard to the level of
     fees paid to non-executive directors by other companies of similar size in the industry.

     The aggregate amount payable to the Company’s Non-Executive Directors must not exceed the maximum annual
     amount approved by the Company’s shareholders, currently $250,000.




102 Mantra Resources Annual Report 2009
Compliance with ASX Corporate Governance Recommendations

During the 2009 financial year, the Company complied with the ASX Principles and Recommendations other than
in relation to the matters specified below.

Recommendation Ref                   Notification of Departure              Explanation for Departure


2.4                                  A separate Nomination Committee The Board considers that the
                                     has not been formed             Company is not currently of a size to
                                                                     justify the formation of a nomination
                                                                     committee. The Board as a whole
                                                                     undertakes the process of reviewing
                                                                     the skill base and experience
                                                                     of existing Directors to enable
                                                                     identification or attributes required
                                                                     in new Directors. Where appropriate
                                                                     independent       consultants     are
                                                                     engaged to identify possible new
                                                                     candidates for the Board.
4.1, 4.2, 4.3                        A separate Audit Committee has         The Board considers that the
                                     not been formed and there is not an    Company is not of a size, nor are its
                                     Audit Committee operating charter      financial affairs of such complexity
                                     (note – an Audit Committee was         to justify the formation of an audit
                                     formed in September 2009).             committee. The Board as a whole
                                                                            undertakes the selection and proper
                                                                            application of accounting policies,
                                                                            the identification and management
                                                                            of risk and the review of the operation
                                                                            of the internal control systems.

                                                                            It is noted that a separate Audit
                                                                            Committee was formed in September
                                                                            2009 as part of the Board’s ongoing
                                                                            reviews of the Company’s corporate
                                                                            governance framework.

8.1                                  There is no separate Remuneration The Board considers that the
                                     Committee.                        Company is not currently of a
                                                                       size, nor are its affairs of such
                                                                       complexity to justify the formation
                                                                       of a remuneration committee. The
                                                                       Board as a whole is responsible
                                                                       for the remuneration arrangements
                                                                       for Directors and executives of
                                                                       the Company.

As the Company’s activities increase in size, scope and/or nature the Company’s corporate governance principles
will be reviewed by the Board and amended as appropriate. Furthermore, as the Company finalises its application
to dual-list on the TSX, the corporate governance framework will be reviewed and improved as required.

The Company’s Corporate Governance            Statement   is   also   available   on   the   Company’s       website
(www.mantraresources.com.au).




                                                                                  Mantra Resources Annual Report 2009   103
     Additional Information

     The securityholder information set out below was applicable as at 30 September 2009.

     1.    Twenty Largest Holders of Listed Securities
     The names of the twenty largest holders of listed securities are listed below:

           Ordinary Shares

                                                                                         No of          Percentage
                                                                                       Ordinary          of Issued
                                           Name                                       Shares Held         Shares

      ANZ Nominees Limited <Cash Income A/C>                                            19,405,317         17.83
      HSBC Custody Nominees (Australia) Limited                                         13,165,646         12.10
      Merrill Lynch (Australia) Nominees Pty Limited <Berndale A/C>                     13,080,649         12.02
      HSBC Custody Nominees (Australia) Limited                                         12,218,860         11.73
      J P Morgan Nominees Australia Limited                                                 7,137,478       6.56
      National Nominees Limited                                                             5,842,487       5.37
      HSBC Custody Nominees (Australia) Limited - A/C 3                                     3,447,300       3.17
      NEFCO Nominees Ltd                                                                    2,893,708       2.66
      Citicorp Nominees Pty Limited                                                         2,509,303       2.31
      Arredo Pty Ltd                                                                        1,640,000       1.51
      Mr Ernest Saronga Massawe                                                             1,579,750       1.45
      Invia Custodian Pty Limited                                                           1,500,000       1.38
      Beacon Exploration Pty Ltd                                                            1,300,000       1.19
      Bouchi Pty Ltd                                                                        1,186,042       1.09
      Mr Robert Behets & Mrs Kristina Behets <Behets Family A/C>                            1,169,415       1.07
      Colbern Fiduciary Nominees Pty Ltd                                                    1,103,486       1.01
      Merrill Lynch (Australia) Nominees Pty Ltd                                             921,378        0.85
      AWJ Family Pty Ltd <A W Johnson Family A/C>                                            814,800        0.75
      Mountainside Investments Pty Ltd <The Oasis Super Fund A/C>                            809,901        0.74
      HSBC Custody Nominees (Australia) Limited - A/C 2                                      766,585        0.70


      Total Top 20                                                                      92,492,105         84.99 %


      Others                                                                            16,312,889         15.01%
      Total Ordinary Shares on Issue                                                  108,804,994         100.00%




104 Mantra Resources Annual Report 2009
Additional Information

2.   Distribution of Equity Securities
Analysis of numbers of shareholders by size of holding:

                                                                        Ordinary Shares

                                                                                                 Number of
                   Distribution                         Number of Shareholders                    Shares

               1        -         1,000                           308                               133,194
          1,001         -         5,000                           412                             1,201,069
          5,001         -      10,000                             133                             1,091,562
         10,001         -     100,000                             232                             7,233,484
                   More than 100,000                               48                            99,145,685
                     Totals                                     1,122                          108,804,994

There were 61 holders of less than a marketable parcel of ordinary shares.

3.   Voting Rights
See Note 15 of the Notes to the Financial Statements.

4.   Substantial Shareholders
As at 30 September 2009, Substantial Shareholder notices have been received from the following shareholders:


                                                                                                    Number of
 Substantial Shareholder                                                                             Shares
 Highland Park SA                                                                                    16,038,982
 Anglo Pacific Group PLC                                                                             12,182,276
 Deans Knight Capital Management Ltd                                                                 10,431,628
 Haywood Securities Inc.                                                                              8,010,128
 JPMorgan Chase & Co. and its affiliates                                                              5,765,736

5.   Onmarket Buy Back
There is currently no on-market buy back program for any of Mantra Resources Limited’s listed securities.




                                                                                  Mantra Resources Annual Report 2009   105
     Additional Information

     6.       Unquoted Securities
     The names of the security holders holding more than 20% of an unlisted class of security are listed below:

                            30 Jun 10 31 Dec 09 31 Dec 10 31 Dec 10 30 Jun 11 30 Jun 10 31 Dec 10 30 Jun 11
                             Unlisted  Unlisted  Unlisted  Unlisted  Unlisted  Unlisted  Unlisted  Unlisted
                             Options   Options   Options   Options   Options   Options   Options   Options
      Unlisted Options       @ $0.35   @ $0.90   @ $1.20   @ $1.65   @ $2.20   @ $2.50   @ $3.00   @ $3.50


      Highland park S.A               -         -          -           -   4,905,243           -         -            -

      Mr Robert Behets
      (or Nominees)           500,000           -          -    600,000            -    600,000          -            -

      Mr Matthew Yates                -         -          -    600,000            -    600,000          -            -

      Mr Anthony
      Charles Devlin                  -         -          -    500,000            -    500,000    500,000            -

      Mr Russell Bradford             -         -          -           -           -           -   300,000      300,000

      ANZ Nominees
      Limited <Cash
      Income A/C>                     -         -          -           -   1,010,081           -         -            -

      Mr Andrew Ian Boyd
      & Mrs Susan Boyd
      <The Cairn A/C>                 -   150,000    150,000           -           -           -         -            -

      Verve Investments
      Pty Ltd <Verve
      Family A/C>                     -   100,000    100,000           -           -           -         -            -

      Mr Nick Holman                  -         -          -           -           -           -         -      150,000

      Mr James Sullivan               -   100,000    100,000           -           -           -         -            -

      Other (each
      individually less
      than 20%)               150,000           -    250,000    350,000       84,676   1,650,000         -       50,000


      Total                  650,000      350,000   600,000    2,050,000   6,000,000   3,350,000   800,000      500,000

     7.       Exploration Interests
     As at 30 September 2009, the Company has an interest in the following licences:

                  Project                  Licence Name            Percentage Interest                Status

      TANZANIA

      Mkuju River                           PL 2995/2005                    100%                      Granted
                                            PL 4700/2007                    100%                      Granted
                                            PL 4701/2007                    100%                      Granted
                                            PL 4702/2007                    100%                      Granted
                                            PL 4703/2007                    100%                      Granted
                                            PL 4704/2007                    100%                      Granted
                                            PL 4705/2007                    100%                      Granted
                                            PL 4706/2007                    100%                      Granted
                                            PL 5822/2009                    100%                      Granted
                                            PL 5823/2009                    100%                      Granted




106 Mantra Resources Annual Report 2009
Additional Information

7.    Exploration Interests (Continued)

             Project             Licence Name     Percentage Interest                  Status

 Mkuju River (cont.)                HQ-P 17359           100%                          Offered
                                    HQ-P 17360           100%                          Offered
                                    HQ-P 17361           100%                          Offered
                                    HQ-P 17362           100%                          Offered
                                    HQ-P 17363           100%                          Offered
                                    HQ-P 17364           100%                          Offered
                                    HQ-P 17365           100%                          Offered
                                    HQ-P 17597           100%                         Application
                                    HQ-G 15321           100%                          Offered
 Mbamba Bay JV                     PL 4168/2007          90%                           Granted
 Southern Tz JV                    PL 5905/2009          90%                           Granted
                                    HQ-P 18417           90%                          Application
                                    HQ-P 18418           90%                          Application
                                    HQ-G 15962           90%                       Under Renewal
                                    HQ-P 20258           90%                          Application
                                   PL 5667/2009          90%                           Granted
                                   PL 4410/2007          90%                           Granted
                                   PL 4301/2007          90%                           Granted
                                    HQ-P 18342           90%                          Application
 Southern Tz JV #2                 PL 4200/2007          95%                           Granted
                                   PL 4425/2007          95%                           Granted
                                    HQ-P 19300           95%                          Application
                                    HQ-G 15985           95%                       Under Renewal
                                    HQ-P 20294           95%                          Application
 Southern Tz                      PLR 5417/2008          100%                          Granted
                                    HQ-P 15130           100%                          Offered
                                  PLR 5733/2009          100%                          Granted
 Bahi North                        PL 5412/2008          100%                          Granted
                                   PL 5413/2008          100%                          Granted
                                  PLR 5414/2008          100%                          Granted
                                   PL 5416/2008          100%                          Granted
 Handa Project                     PL 4298/2006          95%                           Granted
                                    HQ-G 15675           95%                       Under Renewal
                                    HQ-P 19198           95%                          Application
                                  PLR 5826/2009          95%                           Granted
                                    HQ-G 15401           95%                           Offered
                                    HQ-P 17752           95%                          Application
                                   PL 4520/2007          100%                          Granted
                                   PL 4521/2007          100%                          Granted
 Liwale JV                          HQ-G 16077           95%                       Under Renewal
                                    HQ-G 16078           95%                       Under Renewal
                                    HQ-P 20650           95%                          Application
 MOZAMBIQUE
 ZVP - Mozambique                     1062L              100%                          Granted
                                      1768L              100%                          Granted
                                      1769L              100%                          Granted
                                      1770L              100%                          Granted
 Other                                1838L              100%                          Granted




                                                                        Mantra Resources Annual Report 2009   107
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108 Mantra Resources Annual Report 2009
Competent Person Statements
The information in this report that relates to Exploration Results in Tanzania is based on information compiled by Mr Robert Behets, who is a Fellow
of The Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Mr Behets is a full-time employee
of Mantra Resources Limited. Mr Behets 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 ‘Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code). Mr Behets consents to the inclusion in this report of
the matters based on his information in the form and context in which it appears.

The information in this report that relates to Exploration Results in Mozambique is based on information compiled by Mr Matthew Yates, who is
a Member of the Australian Institute of Geoscientists. Mr Yates is a full-time employee of Mantra Resources Limited. Mr Yates 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 ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves (The JORC Code). Mr Yates consents to the inclusion in this report of the matters based on his information in the form and context
in which it appears.

The information in this Report that relates to in-situ Mineral Resources is based on information compiled by Malcolm Titley of CSA Global Pty. Ltd.
Malcolm Titley takes overall responsibility for the Report. He is a Member of the Australasian Institute of Mining and Metallurgy (AUSIMM) and has
sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to
qualify as a Competent Person in terms of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (JORC
Code 2004 Edition). Malcolm Titley consents to the inclusion of such information in this Report in the form and context in which it appears.

The information in this report that relates to the Scoping Study is based on information compiled by Mr. Dave Dodd, who is a Chemical Engineer
and a Fellow of the South African Institute of Mining and Metallurgy. Mr. Dodd is a Technical Consultant of MDM Engineering Ltd, a consultant of
Mantra Resources Limited. Mr. Dodd 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 ‘Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves’. Mr. Dodd consents to the inclusion in the report of the matters based on his information
in the form and context in which it appears.




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