Zandkiopsdrift Rare Earths Project

The Company's principal project is the Zandkopsdrift project which comprises an area of approximately 60,000ha in the Namaqualand region of the Northern Cape Province, of the Republic of South Africa and includes the Zandkopsdrift rare earth deposit. Zandkopsdrift area is well situated approximately 450km north of Cape Town and 230km north of the deep water port of Saldanha Bay. Access to and infrastructure surrounding Zandkopsdrift is generally excellent.

Current Activities

In 2010 the Company focused on developing the Zandkopsdrift deposit and on completion of the 43-101 compliant independent technical report in October 2010 sought a listing on the Toronto Stock Exchange to raise funds to allow for the further development of the deposit. At the start of 2011 the Company initiated an extensive 15,000 metre-drilling programme at Zandkopsdrift. SGS Minerals Services is currently undertaking metallurgical test work on material recovered from Zandkopsdrift and from which it will seek to develop a flowsheet for the recovery and processing of rare earth oxides from Zandkopsdrift. SNC-Lavalin Inc. have been appointed as lead engineering consultants for the Zandkopsdrift preliminary economic assessment which was completed in Q1, 2012.

Geology and History

The Zandkopsdrift deposit comprises a carbonate-rich, magmatic rock deposit containing significant rare earth element bearing mineralization within outcropping and near surface, deeply weathered phases. The Zandkopsdrift carbonatite is exposed as a well-defined, outcropping hill, approximately 40m above a surrounding plain. Zandkopsdrift has been the subject of a number of geological, mineralogical and metallurgical investigations from the 1950s onwards. Most of the work was carried out by Anglo American in two phases over a six-year period, including during the 1980s, when the rare earth potential of Zandkopsdrift was investigated. All of the available rare earth related data from Anglo American ™ work, which included extensive drilling, bulk sampling, metallurgical testing and related analyses, as well as Anglo American ™ original cores, pulps and other samples, were acquired by Frontier in 2008. These data and samples have been validated by independent geological consultants, MSA, and, combined with data from work carried out by the Company, have allowed MSA to produce a CIM compliant resource estimate and a NI 43-101 compliant independent technical report on Zandkopsdrift.

The main rare earth bearing minerals of monazite and crandallite and the mineralization styles at Zandkopsdrift are similar to other rare earth deposits being evaluated and developed globally, most notably Lynas Corporation's Mount Weld deposit in Australia. The highest value heavy rare earth oxides, namely europium, terbium and dysprosium, are contained at elevated levels at Zandkopsdrift compared to several other deposits being evaluated elsewhere. In addition, the levels of thorium (178ppm) and uranium (47ppm) in the Zandkopsdrift deposit are relatively low, which compares favorably to many of the more advanced rare earth projects worldwide and reduces the potential environmental implications that would arise in the event of mine development being undertaken at Zandkopsdrift.

Resource Estimate

In summary, there are approximately 22.92Mt containing 532,000t of TREO at an average grade of 2.32% at Zandkopsdrift in the indicated resource category and an additional 20.81Mt containing 415,000t of TREO in the inferred resource category applying a 1% TREO cut-off.

It is important to note that there are a series of higher grade zones within the overall resource estimate at Zandkopsdrift that are considered to be of sufficient size to be exploited as discrete units within the deposit. The 2.5% cut-off zone is a discrete area referred to as the Zandkopsdrift B-zone which contains circa 450k tonnes of rare earth oxide and is expected to be the initial focus of the company's activities.

Resource Zones

Notes:
Resource is 43-101 compliant
Approximately 60% of the resource in at the Indicated Resource Category