iTech Minerals Ltd. released an Exploration Target of 158 - 264 Mt @ 7 - 12 % TGC for the Sugarloaf Graphite Prospect, near Cleve on the Central Eyre Peninsula. The target has been compiled from over 33 historic drill holes and a detailed airborne electromagnetic survey that has been used to predict the continuity of graphite mineralisation. Sugarloaf Graphite Prospect: The Sugarloaf Graphite Prospect is located approximately 30 km north-west of Cleve on the central Eyre Peninsula and is directly adjacent to iTech's proposed graphite processing plant for the Campoona Spherical Graphite Project.

The graphite at this location occurs within the Paleoproterozoic Hutchison Group Metasediments and is likely to have formed from organic rich stratigraphic horizons metamorphosed during regional upper greenschist to lower amphibolite facies metamorphism during the Kimban Orogeny. The graphite rich horizon forms a largely flat lying, shallow anticlinal structure as interpreted from drilling and detailed airborne and ground-based electromagnetics. When combined, all drilling results confirm that the graphitic-rich body consists of two broadly flat lying zones of graphitic schist that, in aggregate, average 50m in true width, varying in depth from 0m (surface) to 50m below surface.

Drilling results extend over a strike length of 4 km. The host rock is a muscovite bearing quartz-rich metasiltstone. Two airborne electromagnetic surveys have been flown over the Sugarloaf Exploration Target resulting in 10 east-west conductivity depth image sections that were used to predict the subsurface extent of graphite mineralisation.

Confirmation of the conductivity anomaly being caused by graphite mineralisation is confirmed by drilling. A three-dimensional model was generated from the cross sections to define the dimensions of the Exploration Target . No density measurements have been conducted at this time but given the dominant quartz and muscovite composition it is reasonable to ascribe a very conservative density of 1.5 sg units.

The depth of oxidation in the area is approximately 80m vertically below surface corresponding with the current water table. Grade The Sugarloaf Exploration Target area has up to two vertically stacked graphite domains identified from down-hole drill intersections with a combined average thickness of 50 m determined from 13 drill holes over 2.5 km. The weighted arithmetic average of all drill intervals of graphitic schist (sample size n=694) is 9.4% Total Carbon.

Intervals chosen for the analysis had to have visible graphite however no lower grade cut-off was used. In view of no lower cut-off grade being applied it is therefore reasonable to assume that the likely grade will be between 7%-12% Total Graphitic Carbon. A total of 33 holes were compiled from historical exploration reports and the exploration database inherited from Archer Materials (ASX: AXE or Archer) during the acquisition of the tenements.

These holes were selected as they were the only ones from the broader sample set that had total graphite carbon analyses (TGC). Assumptions: The following methodology was used in the calculation of the Exploration Target at Sugarloaf. Using Datamine Discover 3D software, an `outline' of a shallow, flat lying, conductivity anomaly was created from 10 east-west cross sections spaced at 300m in the north and 400m in the south.

The source of the conductivity anomaly was confirmed from drilling results to be graphite mineralisation. A 3D model was generated from the cross sections and an upper plan surface area of 3,527,000 m2 was generated from the model. The surface area multiplied by a range of thicknesses (30m to 50m) were used to develop the tonnage range for the Exploration Target.

Rock density of 1.5 sg units for quartz-muscovite-graphite schist has been assumed. The density (sg) is theoretical and considered to be very conservative. No work has been completed to determine the accuracy of the density assumption.

In determining the average grade, internal waste intervals of up to 3m were used. Next Steps: iTech Minerals has engaged ANZAPLAN, a specialist graphite materials consultancy in Germany, to undertake a metallurgical test work program, on Sugarloaf graphite. The aim of the program is to determine if Sugarloaf graphite can be processed into a concentrate suitable for battery anode material.

A sample is currently enroute to Germany with results expected in 3-4 months. iTech is currently finalising government and landowner drilling approvals across the Sugarloaf Graphite Exploration Target with a view to commence drilling in the last quarter of this calendar year.