WARTHOG RESOURCES (T) LTD

& NGWENA LIMITED

NACHINGWEA PROJECT

DECEMBER 2010 QUARTERLY REPORT

PL 5971/2009
(Matambare)

Matambare PL5971/2009
December Quarterly Report 2010
 WARTHOG RESOURCES (T) LTD
& NGWENA LIMITED
NACHINGWEA PROJECT

Matambare PL 5971/2009

DECEMBER 2010 QUARTERLY REPORT

Introduction

Ngwena Limited (“Ngwena”) has been carrying out an extensive on-going nickel-
copper sulphide exploration program on its prospecting licenses comprising the
Nachingwea Project in SE Tanzania since 2007. Ngwena is a Tanzanian joint
venture corporation owned 75% by Continental Nickel Limited (“CNI”) of Canada and
25% by IMX Resources NL (formerly Goldstream Mining) of Australia.

The Nachingwea Project is comprised of forty (40) granted Prospecting Licenses

(PLs) as of December 31, 2010. A further nineteen (19) PLs are currently under
application. PL 5971/2009 (Matambare) is an integral part of the Nachingwea
Property holding.

During the period, January through December 2010, work on the license consisted of
an airborne geophysical survey, geochemical soil sampling, stream sediment
sampling, data compilation & interpretation and reporting. The highlights of the soil
sampling was a 400m x 400m area of >1000ppm Ni. Lab analyses returned up
to 2220 ppm Ni, 62 ppm Cu and 1700 ppm Cr.

Ngwena Limited has spent ~ $17.5 million USD on exploration on the Nachingwea
Project during the period January 2007 to December 2010. Results have been
encouraging in the Ntaka Hill area, but full evaluation of the entire project area will
require considerably more time and expenditures. Land tenure is critical to successful
and comprehensive exploration efforts.

License Details

Matambare PL5971/2009 was officially granted on December 4th 2009 and covers an
area of 198.66 km2 . The PL was granted to Warthog Resources (T) Ltd and is in the
process of being transferred to Ngwena Limited.

Location

The Nachingwea Nickel-Copper Project is located in southeastern Tanzania and is

centered 100 km north of the Mozambique border, approximately 180 km west of the
coastal port city of Mtwara and 400 km south of Dar es Salaam. The property holding
straddles portions of Nachingwea, Liwali, and Lindi Districts in Lindi Region and the
Masasi District in Mtwara Region.

Ntaka Hill is situated 47 km NW of Nachingwea District town and 12km NW of Mnero

village. All exploration is carried out from a semi-permanent tented camp established

Matambare PL5971/2009
December Quarterly Report 2010
on Ntaka Hill, 1km west of Nditi Village. All work activities for the Nachingwea Project
are supported from the Ntaka Hill Base Camp. Satellite camps and local
accommodation in towns and villages are also utilized as necessary.

The Matambare license is centered 38 km north of Ntaka Camp, 65 km NNE of

Nachingwea District town and encompasses an area of 198.66 km 2 near Selous
Game Reserve (Figure 1). Access to the license is via Mirui-Ruangwa town road and
a foot trail connecting to the Mirui-Ruangwa road at the center west of the license.
The license is drained by three seasonal rivers which pour their water into
Mbwemkuru River.

Figure 1: Matambare PL 5971/2009 location map. Black lines are roads/tracks, fine
blue lines are creeks, red lines are license boundaries and green lines are
National/District Game/Forest reserves. Ntaka Camp and local villages are also
shown for reference.

Matambare PL5971/2009
December Quarterly Report 2010
Project Exploration History and Current Exploration Objective

The project area has been sporadically explored since the 1950’s for base and
precious metals and PGE’s. Current exploration work being conducted is focused on
discovering economic nickel-copper mineralization similar to the recent discoveries
currently being evaluated in the Ntaka Hill area.

Work to date on the Nachingwea Project has consisted of interpretation of historical

geochemical and geophysical datasets, regional airborne EM and magnetic surveys
(2007 & 2008), soil and stream sampling programs (2008-2010), regional geology
traverses and ground checking of EM and geochemical anomalies. In addition
ground geophysical surveys and diamond drilling (2008-2010) have been carried out
on selected licenses, particularly in the Ntaka Hill area.

A large regional radiometric and magnetic survey was also completed in 2010 over
the entire Nachingwea Project in order to accelerate the definition of exploration
targets.

The current exploration objective on the Matambare license is to identify prospective

geological areas that can be further evaluated using geological, geochemical and
geophysical methods. The prospective areas are typically identified by interpretation
of airborne geophysical surveys and existing geochemical data. The selected areas
are then field checked by a geologist and additional geochemical and/or ground
geophysical data may be obtained with the objective of defining a drill target.

Geological Setting

The Nachingwea Project lies within the late Proterozoic Mozambique Belt of
southeastern Tanzania. The Mozambique Belt ("MB") comprises a dominantly north-
south trending domain of highly deformed and metamorphosed rocks which formed
during oblique collision of east and west Gondwana and are part of the Pan African
Orogenic System. The MB includes lithologies that have been affected by both the
Usagaran (1.8-2.0 Ga) and the Pan-African (650-580 Ma) orogenic events.

The first stages of the MB formation occurred at 1,000-700 Ma. This initial stage was
marked by large-scale magmatic intrusive activity, which may include the ultramafic-
mafic intrusions observed on the Nachingwea property. This was followed with two
collisional phases recorded at 640-620 Ma and 580-530 Ma, which are largely
responsible for the regionally observed complexly deformed tight fold structures
dominant across the project area. Peak metamorphic conditions to granulite facies
are dated at 640 Ma.

In the general Nachingwea Project area, MB lithologies consist of a mixed

assemblage of mafic to felsic granulites, gneisses and migmatites (interpreted to
represent volcanic protoliths) interlayered with amphibolites and metasedimentary
rocks, including quartzites, banded magnetic quartzites, pelites, graphitic schists and
marbles. These lithologies are cross-cut by poorly documented mafic to ultramafic
intrusions of unknown age and include the Ntaka ultramafic intrusion which hosts
considerable nickel-copper-cobalt sulfide mineralisation. All units are complexly
deformed and metamorphosed to amphibolite and granulite facies and occur in
blocks bounded by major NW, EW and NE fault zones.

Matambare PL5971/2009
December Quarterly Report 2010
As outcrop is non-existent to rare across most of the licenses little detail is known of
the local geology on the licenses. The majority of information to date has been
gathered from mapping and drilling predominantly at Ntaka Hill. However regional
geological traverses, grid mapping and drilling are started to add to the geological
database.

Summary of Work – PL 5971/2009, 2010 Exploration program

A regional exploration program was in progress during the December quarter and was
based out of the Ntaka Hill camp. Work completed in the December Quarter included
geochemical soil sampling, data compilation and interpretation. Table 1 and Figure 2
summarize the total exploration work completed on the license in 2010. Details and
results of the 2010 exploration program are given below.

Table 1
Summary of Work Completed in 2010 PL 5971/2009 (Matambare)

Work Type Production

524 samples for NITON analysis
Soil sampling
32 samples sent to the lab
Stream Sediment Sampling 50 samples for NITON analysis
Airborne Radiometric and Magnetic
875.4 line km
Survey
External Review of Historical Analysis and report completed by
Geochemical Data Richard Carver

2010 Soil Sampling and Results

Three east-west soil grids were planned on the license to test the geochemical
response of the 2010 airborne radiometric anomalies (RAD-13 and RAD-16) and
follow up on elevated Ni in streams (up to 1919ppm Ni in a 2009 CNI stream
sample). A total of 524 soil samples were collected from the three grids for analysis.
All samples were collected in the September 2010 quarter. The samples were
analyzed by a portable NITON XRF instrument prior to sending 32 anomalous
samples to ALS Chemex lab for assaying.

The Matambare C soil grid was designed to outline the source of a 1919ppm Ni
anomaly in a 2009 CNI stream sample and to cover the western edge of radiometric
target RAD-13. The grid consisted of five east-west survey lines 400m apart with
100m sample spacing and nine east-west survey lines, 200m apart with 100m
sample spacing. Soil sampling was completed in the third week of July 2010. Three
hundred and sixty five samples were collected during the program for NITON XRF
instrument analysis. The Niton results identified a 400m x 400m area of >1000ppm
Ni, within a larger area of 200ppm Ni. 32 samples were sent to ALS Chemex for lab
analyses, which returned up to 2220 ppm Ni, 62 ppm Cu and 1700 ppm Cr.

The Matambare D soil grid was designed to cover radiometric target RAD-16 and a
94ppm Ni anomaly in 2005 IMX streams. Soil sampling on eight survey lines 400m
apart with 100m sample spacing was completed in the third week of July 2010. One
hundred and sixty five samples were collected for NITON XRF instrument analysis.

Matambare PL5971/2009
December Quarterly Report 2010
Out of 165 collected samples, two samples returned anomalous values >100ppm
(one isolated sample with >100ppmNi and one isolated sample with >100ppm Cu).
Maximum NITON XRF results returned 127 ppm Ni, 141 ppm Cu and 188 ppm Cr.
No samples were sent to ALS Chemex lab for assaying from this grid.

The Matambare E soil grid was designed to cover radiometric target RAD-13. This
grid consisted of a single east-west survey line with 100m sample spacing. Soil
sampling was completed in the third week of July 2010. Twenty four samples were
collected during the program for NITON XRF instrument analysis. Three samples out
of twenty four samples returned >100ppm Ni next to a serpentinite outcrop. Maximum
NITON XRF results returned 203 ppm Ni, 116 ppm Cu and 236 ppm Cr in soil. No
samples were sent to ALS Chemex lab for assaying from this grid.

2010 Stream Sediment Sampling and results

A program was completed on the Matambare license in the September 2010 quarter
in order to follow up 2005 IMX stream sediment geochemical anomalies and
magnetic and radiometric anomalies seen in the 2010 airborne survey. 10 streams
(Matambare F-Q) were covered on the license. The samples collected were analyzed
by a Niton XRF instrument and no samples were sent to the lab for further assay.

Matambare F Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX sample which returned 103ppm Ni and 77ppm Cu. Four samples were collected
at 300m sample spacing along a stream. All Ni and Cu values were below the
detection limits of the NITON XRF instrument and no samples were sent to ALS
Chemex lab for assaying from this stream.

Matambare G Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 109ppm Ni and 56ppm Cu. Six samples were
collected at 500m sample spacing along a stream. Four samples returned >50ppmCu
by NITON XRF instrument analyses and no samples were sent to ALS Chemex lab
for assaying from this stream. Maximum NITON XRF results were 91ppm Ni, 90ppm
Cu and 122ppm Cr.

Matambare H Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 96ppm Ni and 41ppm Cu. Four samples were
collected at 350m sample spacing along a stream. One sample returned 145ppm Ni
by NITON XRF instrument analyses and no samples were sent to ALS Chemex lab
for assaying from this stream. Maximum NITON XRF results were 145ppm Ni, <LOD
Cu and 257 ppm Cr.

Matambare I Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 90ppm Ni and 75ppm Cu. Two samples were
collected at 600m sample spacing along a stream. No significant anomalous values
were detected by NITON XRF instrument analyses and no samples were sent to ALS
Chemex lab for assaying from this stream. Maximum NITON XRF results were <LOD
Ni, 51ppm Cu and 141 ppm Cr.

Matambare J Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005

Matambare PL5971/2009
December Quarterly Report 2010
IMX stream sample which returned 113ppm Ni and 74ppm Cu. Three samples were
collected at 400-700m sample spacing along a stream. No significant anomalous
values were detected by XRF NITON instrument analyses and no samples were sent
to ALS Chemex lab for assaying from this stream. Maximum NITON XRF results
were <LOD Ni, 49ppm Cu and 182ppm Cr.

Matambare K Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 96ppm Ni and 33ppm Cu. Five samples were
collected at 800m sample spacing along a stream. No significant anomalous values
were detected by NITON XRF instrument analyses and no samples were sent to ALS
Chemex lab for assaying from this stream. Maximum NITON XRF results were
87ppm Ni, 57ppm Cu and 124ppm Cr.

Matambare L Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 86ppm Ni and 25ppm Cu. Four samples were
collected at 600m sample spacing along a stream. No significant anomalous values
were detected by NITON XRF instrument analyses and no samples were sent to ALS
Chemex lab for assaying from this stream. Maximum NITON XRF results were
59ppm Ni, 38ppm Cu and 119ppmCr.

Matambare M Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 130ppm Ni and 98ppm Cu. Four samples were
collected at 400-700m sample spacing along a stream. Weak elevated Ni values
were detected by NITON XRF instrument analyses and no samples were sent to ALS
Chemex lab for assaying from this stream. Maximum NITON XRF results were
76ppm Ni, 51ppm Cu and 133 ppm Cr.

Matambare N Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 78ppm Ni and 64ppm Cu. Two samples were
collected at 700m sample spacing along a stream. One sample returned 96ppm Cu
by NITON XRF instrument analyses and no samples were sent to ALS Chemex lab
for assaying from this stream. Maximum NITON XRF results were <LOD Ni, 96ppm
Cu and 59ppm Cr.

Matambare O Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature and to follow-up a 2005
IMX stream sample which returned 98ppm Ni and 37ppm Cu. Two samples were
collected at 600m sample spacing along a stream. One sample returned 106ppm Cu
by NITON XRF instrument analyses and no samples were sent to ALS Chemex lab
for assaying from this stream. Maximum NITON XRF results were 106ppm Ni,
40ppm Cu and 147ppm Cr.

Matambare P Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a large magnetic feature. Two samples were
collected at 500m sample spacing along a stream. No significant anomalous values
were detected by NITON XRF instrument analyses and no samples were sent to ALS
Chemex lab for assaying from this stream. Maximum NITON XRF results were <LOD
Ni, 32ppm Cu and 125ppm Cr.

Matambare Q Stream sampling was carried out in the fourth week of July in order to
collect information in the area of a magnetic feature. Twelve samples were collected

Matambare PL5971/2009
December Quarterly Report 2010
at 400-1000m sample spacing along a stream. No significant anomalous values were
detected by NITON XRF instrument analyses and no samples were sent to ALS
Chemex lab for assaying from this stream. Maximum NITON XRF results were 57
ppm Ni, 39ppm Cu and 116ppm Cr.

Airborne Radiometric and Magnetic Survey

A regional airborne geophysical survey totaling 875.4 line km was flown across the
entire license in the June quarter. Magnetic and radiometric date was collected on E-
W flight lines flown at 250m line spacing. Data compilation and interpretation is on-
going and will focus on identifying radiometric targets to be followed up with future
surface geochemical surveys.

External Review of Historical Geochemical Data (R. Carver)

An external review of historical geochemical data for the Nachingwea Project was
completed by Richard Carver. The study comprised 4,661 soil samples and 1,461
stream sediment samples collect by BHP, IMX and CNI between 2005 and 2009 and
included samples collected on the current Matambare license.

On the Matambare license, the following anomalies were identified:

 1 weak Ni in stream anomaly draining a large area
 1 strong Ni-Au in stream sediment anomaly, located within the Ni in stream
anomaly described above

Matambare PL5971/2009
December Quarterly Report 2010
Figure 2: A map showing exploration work completed in 2010 on the License
PL 5971/2009 (Matambare).

Expenditures

Expenditures for Matambare PL 5971/2009 for the December 2010 Quarter are
USD $16,922.

See attached Table.

Christopher Airo and Stanslaus William

Ngwena Limited

Matambare PL5971/2009
December Quarterly Report 2010