TETE PROJECT - Baobab Resources prospects within the Tete project. Highlights The Massamba Group vanadiferous titano-magnetite prospects are co-incident with

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PRESS RELEASE | 6/19/2008 Page 1 of 4

TETE PROJECT – MASSAMBA AREA AIRBORNE GEOPHYSICAL INTERPRETATION

18th June 2008 Baobab Resources plc (AIM:BAO) (‘Baobab’ or ‘the Company’), a Mozambique focused mineral exploration company is pleased to present the results of an interpretation of a portion of the recently completed aeromagnetic survey covering the Massamba Group vanadiferous titano-magnetite prospects within the Tete project. Highlights

The Massamba Group vanadiferous titano-magnetite prospects are co-incident with significant magnetic anomalies.

Geophysical modeling of these magnetic anomalies indicates that the magnetite

bodies are sub-vertical, varying in width from 50m to 450m and continuous over strike lengths of up to 3.5km, with a combined strike length in excess of 8km.

Bulk density analyses of titano-magnetite rock samples from the Massamba area

have returned an average specific gravity (g/cm3) of 4.3, significantly higher than previously anticipated.

Previously reported rock chip sampling from Massamba Group returned average

grades of 49% Fe, 21% TiO2 and 0.3% V (refer to press release dated 20 May 2008).

The modeled depth to the top of the magnetic anomalies is generally shallow (0 to 50m).

Field verification of magnetite highs has located previously unrecorded outcrops of

magnetite, further supporting the geophysical interpretation.

Consultants have been commissioned to determine the metallurgical characteristics of the deposits and the economics and potential processes for recovering either a vanadium product or a combination of pig iron, vanadium and titanium products.

The geophysical data supports the interpretation of a large potential tonnage of

titano-magnetite in the Massamba area. Overview The Tete project is located immediately north of the Provincial capital of Tete and comprises three contiguous Exploration Licences that straddle the central portion of the Tete Mafic Complex, covering an area of approximately 632km2. The Licences contain 5 known vanadiferous titano-magnetite deposits: Singore, located within license 1032L approximately 30km due north of Tete; and the cluster of prospects known collectively as the Massamba Group, located within 1035L and 55km north-northeast of Tete. Recent rock chip sampling from Massamba Group returned average grades of 49% Fe, 21% TiO2 and 0.3% V (refer to press release dated 20 May 2008). The Complex is considered analogous to the Bushveld Complex and is therefore also prospective for Platinum Group Metal (PGM) mineralisation as well as massive Ni-Cu sulphide deposits.

Tete is fast becoming a major investment centre with mining majors Vale and Riversdale in the process of opening up the Moatize and Benga coal fields. The railway connecting Tete to the deep water port of Beira is being refurbished, as is the port. Power is readily available from the Cahora Bassa hydroelectric scheme with additional schemes on the Zambezi in advanced planning stages. A coal fired power plant has also been proposed for Benga. Geophysical Interpretation The Company’s consultant geophysicist, Hawke Geophysics Pty Ltd, has completed an interpretation of a portion of the recently acquired high resolution aeromagnetic data covering the Massamba area (approximately 110km2). The area comprises the Massamba Group of vanadiferous titano-magnetite deposits, namely the Chitongue Grande, Chitongue Pequeno, Chimbala and Caangua prospects. Three significant trends have been identified for further investigation:

The Chitongue Grande – Chimbala Trend: a broad zone of strong magnetic response continuous over a north-south strike length in excess of 3.5km and containing the Chitongue Grande prospect and the Chimbala prospect in its northern and central portions respectively.

The Chitongue Pequeno – Caangua Trend: The Chitongue Pequeno and Caangua

prospects appear to flank a narrower, northwest oriented anomaly approximately 2.5km in length.

Southern Trend: Re-appearance of the Chitongue Grande – Chimbala trend to the

southwest after a zone of tectonic disruption where it may be traced over a strike length of 2.5km.

The interpretation included profile modeling of the magnetic data to determine the geometry of the magnetic sources for selected areas of high magnetic intensity. Five sections were selected: three transecting the Chitongue Grande – Chimbala Trend, one crosscutting the Chitongue Pequeno - Caangua Trend, and an additional profile through the Southern Trend. Chitongue Grande – Chimbala Trend Modeling of profile data across the Chitongue Grande prospect shows the source of the main magnetic anomaly to be due to two parallel, 200m wide, sub-vertical bodies at depths from surface ranging from 30 to 50m. A third body, of lower magnetic amplitude, is modeled immediately to the east and is estimated to be approximately 150m wide. The magnetic anomalism underlying the Chimbala prospect (2km south of Chitongue Grande) is modeled as a series of semi-continuous bodies, with depths from surface ranging from 20m in the west to 45m in the east. The individual bodies are interpreted to be sub-vertical and between 100m and 450m in width. It is not certain whether the modeled bodies represent folding or fault repetition of the trend seen in the Chitongue Grande area to the north, or whether the source was thicker in this central region during emplacement. Modeling of an oblique section across the southern limit of the Chitongue Grande – Chimbala trend (approximately 2km southwest of the Chimbala prospect) suggests the majority of the magnetic source is much deeper (>100m) than on the sections to the north. This may represent deeper burial (possibly down faulting), or alternatively deeper weathering, of the magnetic source rock. Two discrete bodies have been modeled with widths of 75m and 300m. Chitongue Pequeno – Caangua Trend A single profile was modeled across the 2.5km long, northwest trending anomaly flanking the Chitongue Pequeno and Caangua prospects. The main magnetic anomaly along this section is due to a relatively narrow, 50m wide sub-vertical body from 12m depth.


Southern Trend Magnetic modeling across the 2.5km long southern continuation of the Chitongue Grande – Chimbala trend shows two main magnetic zones each composed of two smaller, parallel magnetic sources. Each magnetic ‘bed’ appears to be steeply west dipping and has a modeled thickness of between 85 and 100m. Depth to magnetic response is estimated at 0 to 25m. All bodies described above have modeled magnetic properties which would be in the normal range for banded iron formation (BIF). Field verification, density determinations & bulk sampling To complement the geophysical modeling, a number of the magnetic anomalies discussed above were selected for field checking under the supervision of international consultancy Coffey Mining Pty Ltd. Previously unreported titaniferous magnetite outcrops were identified at most of these target locations. A total of 11 titano-magnetite rock chip and float samples were collected in the Massamba area during the field verification for multi element analysis and bulk density determinations. Results from the bulk density work completed at the ACT-UIS laboratory in Tete returned an average ‘in ground’ specific gravity (g/cm3) of 4.3, significantly higher than anticipated. A complete list of results is tabulated below: Massamba Group Real Density Determinations

Sample ID East North Spec. Grav [g/cm³] Rock Type

MAS01 571719.52 8262272.88 2.9 Massive magnetite MAS02 572804.79 8261762.17 4.48 Massive magnetite MAS04 572294.08 8261054.14 3.17 Massive magnetite MAS05 571620.86 8259893.42 4.21 Massive magnetite MAS06 571469.97 8259028.69 4.48 Massive magnetite MAS07 571446.76 8258071.1 4.52 Massive magnetite MAS09 574685.14 8263126.01 4.62 Massive magnetite MAS10 574336.93 8264513.05 4.41 Massive magnetite MAS12 574464.61 8265789.84 4.53 Massive magnetite MAS18 575265.5 8267316.17 5.4 Massive magnetite MAS19 574940.5 8268436.26 4.77 Massive magnetite

Note: Samples represent rock chip specimens collected from magnetite outcrop or float. All density determinations performed at ACT-UIS Laboratorios de Moçambique Lda, Tete. Coordinates in WGS84/UTM36S datum. The Company has commissioned internationally recognised consultancy Mineral Engineering Technical Services (METS) to manage bench-scale test work to determine the metallurgical characteristics of the vanadiferous titano-magnetite and the economics and potential processes for recovering either a vanadium product or a combination of pig iron, vanadium and titanium products. A 300kg bulk sample has been collected from the Massamba area and is in the process of being shipped to Australia. Commenting today, Ben James, the Company’s Technical Director, stated: “We believe the results of the geophysical interpretation significantly upgrade the potential of the Massamba area to host large tonnages of ore. Findings of the recent field verification programme have reinforced the fact that this highly prospective terrain has experienced limited previous economic exploration, presenting the opportunity for making major new discoveries. “We look forward to reviewing the results of the metallurgical test work which will direct our future exploration initiatives in this area. With the price of vanadium being directly linked to steel production and the level of demand for steel showing no sign of abating, it is intended to commence drilling campaigns as soon as results dictate.”

18th June 2008


Download press release, complete geophysical report and figures from the Baobab website at: www.baobabresources.com The information in this release that relates to Exploration Results is based on information compiled by Technical Director Ben James (BSc). Mr James is a Member of the Australian Institute of Mining and Metallurgy, is a Competent Person as defined in the Australasian Code for Reporting of exploration results and Mineral Resources and Ore Reserves. and consents to the inclusion in the report of the matters based on the information in the form and context in which it appears. For Further Information please contact: Baobab Resources plc Tel: +61 (0)8 9430 7151 Brett Townsend Executive Director Baobab Resources plc Jeremy Dowler: Non -Executive Chairman

Tel: +44 (0)1372 450529

Grant Thornton Corporate Finance Tel: +44 (0)20 7383 5100 Fiona Owen

Fox-Davies Capital Limited Tel: +44 (0)20 7936 5200 Daniel Fox-Davies


http://www.baobabresources.com/

6 Joy Close, Willetton, WA 6155 Mobile: 0419 500 383 Fax: 08 9259 0722

Memorandum To: Ben James, Baobab Resources

From: Phil Hawke

Date: 13 Jun 2008

Re: Notes on the interpretation of magnetic data over the Massamba Fe-Ti Project

Background

The Massamba Fe-Ti Project is located 12 km west of the town of Muchena in the

northern part of the Cacame (Tete) tenement block (Figure 1). The Massamba Project is

defined by an approximately 6 x 10 km area of elevated magnetic response.

Figure 1: Masamba iron Project within the Cacame (Tete) tenement shown against the regional

Landsat image. Red squares show the locations of historically known Fe-Ti prospects.

This memo describes a review of a newly acquired magnetic survey to determine the

potential for host (magnetic) rocks for titano-magnetite ore.

Geophysical surveys

Magnetics and radiometric survey

A detailed, heli-borne (gradiometer) magnetic and radiometric survey was completed

over the Cacame tenement block by New Resolution Geophysics (NRG) during April

2008.Basic survey specifications were:

Line spacing: 100m

Line direction: 90-270°

Nominal height: 30m

Figure 2: TMI image of Massamba Project. Field check locations shown as green diamonds.

Gradient enhanced magnetic and (cps) radiometric grids and located data were created by

NRG. A suite of images based on these grids were supplied to Baobab. An image of total

magnetic intensity over the Massamba Project area is shown as Figure 2.

A number of magnetic anomalies were selected for field checking (Figure 2). Fe-Ti

(magnetic) outcrop was identified at most of these target locations. Non titano-magnetite

sources for the magnetic anomalies were only identified for two targets, MAS15 and

MAS16.

Interpretation

A schematic interpretation of the Massamba Project area is shown in Figure 3.

Figure 3: Schematic interpretation of major magnetic features in the Massamba area (refer to text).

Geological units have been subdivided into six main categories:

1. Strongly magnetized Fe-Ti (NNE trending): dark blue - The western most part of

this NNE magnetic trend has the greatest magnetic response (typical anomaly

amplitude of 2500-4700nT). Field visits indicate anomaly due to titano-magnetite.

Previously known prospects at Monte Chitongue Grande and Monte Chimbala

form within this trend.

2. Moderately magnetized Fe-Ti (NNE trending): lighter blue – Similar to above,

but less magnetic. Typical anomaly amplitude ~500nT.

3. Moderately magnetized layered Fe-Ti (folded / NW trending): purple – Narrow

bands within a bedded sequence, seems to reflect a specific horizon within a

layered (volcanic?) complex. Field visits to several locations along this trend

gave poor outcrop, however a (cherty?) titano-magnetite (BIF?) unit is described

at MAS15. Anomalies up to 2500nT (at MAS13).

4. Weakly magnetized layered unit(?): light purple – Narrow weak-moderately

magnetized bands (anomalies <500nT) within the layered complex. No field

check information at this horizon. Nature of magnetic source unknown.

5. Moderately magnetic gabbro: dark green – Interpreted from field check notes

from localities MAS15 and MAS16.

6. Unknown magnetic layers: pale green – Moderately magnetic units within the

layered sequence not field visited. Also suspected to be due to a mafic volcanic

source.

Faults offsetting stratigraphic units are interpreted in generally NE, NS and NW

orientations. NS faults appear to disrupt the strongly magnetized Fe-Ti unit; bounding it

to the west in the northern part of the Project area and possibly causing structural

repetition of this unit in the Monte Chimbala area.

Modelling

Five profiles of magnetic data were modeled to determine a reasonable first pass estimate

of the geometry of the magnetic sources for selected areas of high magnetic intensity.

The locations of these lines are shown in Figure 2; Line 60000 in the southern block, an

oblique section through a prominent magnetic trend to the west of Monte Chitongue

Pequeno, and Lines 66000, 64000 and a second oblique section along the Monte

Chitongue Grande trend.

Southern Block

A 2.5 km long, 250m wide zone of high magnetic intensity between 8258000mN and

8260500mN is defined as the Southern Block.

Three profiles of magnetic data were extracted from the magnetic grid within this area are

shown in Figure 4. The peak amplitude response of approximately 3500nT was on Line

60000 (826000mE), which is located close to field location MAS05.

Data were modeled using Encom’s Modelvision software. A forward model section for

Line 60000 is shown in Figure 5.

Figure 4: Magnetic profiles across selected

anomalies in the Southern Block.

Magnetic modeling shows two main magnetic zones (shown in blue) each requiring two

smaller, parallel magnetic sources in order fit the observed response. Each magnetic

“bed” has a modeled thickness of between 85 and 100m.

depth = 25mk = 0.75 SIK = 0.91 SI

depth = 25mk = 0.38 SIk = 0.60 SI

depth = 0m

k = 0.16 SI

Modelled response

Observed response

Figure 5: Forward magnetic model for Line 60000

The western most pair of bodies is the cause of the dominant magnetic response and has

an average (modeled) magnetic susceptibility of 0.8 SI. To the east of these, a second pair

of bodies has an average susceptibility of 0.5 SI. In both cases the modeled magnetic

susceptibility is of a similar magnitude to that expected for fresh BIF. Both sets of

magnetic sources are shown dipping steeply to the west, although this is not well

constrained by the model.

A third magnetic trend, modeled by the light green body, is modeled by a broader body

with a magnetic susceptibility of ~0.15 SI.

All bodies have a modeled depth to top of 0-25m, which can be easily attributed to the

effect of shallow weathering of a outcropping (sub-cropping) source.

Monte Chitongue Grande

Monte Chitongue Grande is an area of known titano-ferrous outcrop, albeit relatively

small in extent. Two profiles of data were extracted from the magnetic grid and are

shown in Figure 6.

Figure 6: Magnetic profiles across selected anomalies in the Monte Chitongue area.

The peak amplitude response is 4700nT on Line 66000 (575350mE), which is located

adjacent to (titano-)magnetite outcrop at Monte Chitongue Grande. A forward model

section of this profile is shown in Figure 7.

Forward modeling shows the source of the main magnetic anomaly to be due to two (light

blue) bodies at depths ranging from 30-50m. These bodies are approximately 200m wide

(each) and have modeled magnetic susceptibilities in excess of 1 SI.

A second magnetic anomaly of roughly half the amplitude (darker blue source) is

modeled by a single body of approximately 150m, but still with a strong magnetic

susceptibility of 0.75 SI.

All of these bodies have modeled magnetic properties which would be in the normal

range for fresh BIF.

Modelled response

Observed response

depth = 30mk = 0.18 SI


depth = 25m

k = 0.75 SI

depth = 30m

k = 1.24 SI


Western trend

The western trend is a 2.5 km magnetic trend passing through targets MAS12 to MAS14.

The peak anomaly amplitude (at MAS13) is approximately 1500nT (Figure 8).

While not shown here, the magnetic response over the Monte Chitongue Pequeno

magnetite outcrop is 3100nT.

Modelled response

Observed response

depth = 12m

k = 0.42 SIdepth = 0m

k = 0.06 SI

depth = 200mk = 0.19 SI(? req’d to fit regional)

depth = 27m

k = 0.29 SI

depth = 20m

k = 0.24 SI

Figure 8: Forward magnetic model for the Oblique Line 1.

The main magnetic anomaly along this section (MAS13) is due a 50m wide sub-vertical

body from 12m depth with a magnetic susceptibility of 0.42 SI. Several other sub-vertical

sources are required to fit the observed response – although are narrower and possess a

lower magnetic susceptibility.

A (200m) deep horizontal body was used to help fit the regional magnetic field. The

physical meaning of this body is not known.

Monte Chimbala

The Monte Chimbala area is also historically known for Fe-Ti lode material. The large

NNE trending magnetic anomaly (>2500nT amplitude) continues south through this

region to approximately 8261750mN. Select profiles in the Monte Chimbala region are

shown in Figure 9.

Figure 9: Magnetic profiles across selected anomalies in the Monte Chimbala area.

A series of three anomalies across the known Monte Chimbala deposit (Line 64000)

cover a width of 1000m and have peak values in excess of 2500nT. A model section

along this profile is shown in Figure 10.

The anomaly is modeled by a series of semi-continuous magnetic bodies, with depths

carrying from 20m (western most block) to 45m (to the east). It is not certain whether the

modeled bodies represent folding or repetition of the linear magnetic trend seen further to

the north, or whether the source was thicker in this central region during emplacement

(c.f. a magmatic or hydrothermal origin of the titano-magnetite mineralisation).

Weaker magnetic anomalies (~500nT) to the east of the main anomaly are still due to a

modetately magnetic source, with a modeled susceptibility of 0.36 SI.

Modelled response

Observed response

depth = 46m

k = 0.85 SI



depth = 26mk = 1.15 SIdepth = 27m

k = 1.05 SI depth = 30m

k = 0.86 SI

depth = 26m

k = 0.36 SI


The southern-most extent of the Monte Chimbala magnetic trend is modeled by Oblique

section number 2 (Figure 11).

The modeling suggests the majority of the magnetic source is much deeper (>100m) than

on sections to the north. This may represent either deeper burial, or alternatively deeper

weathering, of the magnetic source rock. A moderately magnetic near surface source

(green body) probably represents a dolerite dyke. A shallower (20m depth) magnetic

source may represent either a small fault block of titano-magnetite residual magnetic area

within the zone of weathering.

Modelled response

Observed response


depth = 110m

k = 0.80 SI


depth = 125mk = 0.80 SI

Figure 11: Forward magnetic model for the Oblique Line 2.

Conclusions

The anomalous magnetic trends in the Massamba Project area can be divided into two

broad categories;

• Folded, but generally NW trending anomalies with an amplitude up to around

1500nT, possibly reflecting bedding or layering of the primary sequence of rocks.

• A more magnetically intense NNE trend(s), up to 4500nT in amplitude, possibly

reflecting an overprint of the primary sequence.

The Monte Chitongue Pequeno and Monte Caangua titano-magnetite outcrops appear to

lie within the first group of anomaly trends, while the Monte Chitongue Grande and

Monte Chimbala occurrences fall within the second.

Magnetic modeling indicates the (western half) of the NNE magnetic trends to be due to

100-200 m wide bodies of greatest magnetic intensity (0.7 – 1.3 SI) and so are considered

the best targets for magnetite mineralisation. Because of their thickness, these bodies may

also have developed an appreciable hematite resource in upper, oxidized parts of the rock

unit.

Towards the southern extent of the trend of the Monte Chitongue / Monte Chimbala

magnetic trend the modeling indicates a greater depth to magnetic source. This is most

likely to be due to a greater depth of burial, but if it is indicative of deeper weathering

then this area may be more prospective for hematite mineralisation.

Other targets, including the NW trending features are generally narrower, and are

modeled with a lower magnetic susceptibility (suggesting a lower primary magnetite

content). However, these may still form valid targets for Fi(Ti) mineralisation although

perhaps not of the same grade / tonnes as the the NNE trends.

Based on the work completed so far the following areas are recommended as targets for

further work, in order of priority:

• Monte Chitongue Grande / MAS18

• MAS05 to MAS07

• Monte Chitongue Pequeno magnetic anomaly

• MAS13 to MAS14.

A program of field mapping and rock chip sampling of selected anomalies is believed to

have been recently completed (awaiting assay results). Geological mapping to help

constrain the regional geological framework would be useful, but may be difficult given

the limited outcrop available.

Drill testing of the magnetic anomalies / titano-magnetite outcrops seems the next logical

exploration step for these targets. Given the likelihood that these bodies are probably

steep- to vertically-dipping, angled holes (stepping out to drill 60° to the east?) are

suggested to help in complete sampling of the target magnetic sources.

DISCLAIMER: This report is intended to provide technical advice to the Client Company and it’s

Agents. Permission form the author must be sought prior to publication of these results for any

other purpose such as broker presentations or Stock Exchange release.

While all due care and consideration has been taken in the preparation of this report, Hawke

Geophysics Pty Ltd is not responsible for the consequences of any action taken by any person in

reliance of the information contained in this report or for any errors or omissions in this report.

Hawke Geophysics Pty Ltd expressly disclaims any and all liability or responsibility to any person in

respect to anything done, or omitted from being done, in respect of the information set out in this

report, any inaccuracy in the report or the consequences of any action by any person in reliance,

either wholly or partly, upon the whole or any part of the content of this report.

Documents

TETE PROJECT - Baobab Resources prospects within the Tete project. Highlights The Massamba Group vanadiferous titano-magnetite prospects are co-incident with