Highlights

Management

Jonathan Shellabear appointed as Managing Director. Mr Shellabear is a senior executive with extensive experience in the Australian and international mining industries having held senior corporate and investment banking roles with NM Rothschild & Sons (Australia) Limited and Deutsche Bank. Most recently he was the Managing Director and Chief Executive Officer of Dominion Mining Limited, a position he held until February 2011 following the completion of the agreed takeover of Dominion by Kingsgate Consolidated Limited.
Heron has a very compact and experienced Management Team of three geoscientists, responsible for Business Development, Development Projects and Exploration Projects.

Corporate

Heron remains in a strong financial position with a 30 September 2011 cash balance of $45.8M, with outgoings minimized through efficient staffing levels.
Heron is well positioned to pursue significant Business Development opportunities which continue to be identified and systematically evaluated by the Management Team.
The offer rate to Heron in Business Development has significantly increased since March 2011.

Development Projects

Kalgoorlie Nickel Project

744Mt at 0.73% Nickel and 0.044% Cobalt, significant Iron credits
Potential to produce 37,000tpa Nickel in intermediate product over a 35 year mine life
Metallurgical optimizing studies current, commenced research project into ore types with internationally accredited research group CSIRO.
The Company retained an international engineering consultancy to advise on the treatment and future marketing of potential iron-nickel targets identified within the KNP. The consultancy is a world-renowned group and has specialist expertise in the processing and marketing of iron-nickel.
An initial combined iron-nickel resource at the Goongarrie South deposit has been estimated at 48.5Mt at 41% iron and 0.65% nickel. An estimation of other iron-nickel resources elsewhere within the KNP has not yet been completed.
Internationally recognized metallurgical laboratory SGS Lakefield Oretest has commenced bench-scale metallurgical test-work of an iron-nickel bulk sample.

Yerilla Nickel Project

135Mt at 0.77% Nickel and 0.05% Cobalt, significant Iron credits
Metallurgical optimizing studies current, including conventional leach and thermal upgrade technology
Shanshan may earn 70% by commissioning production, joint venture agreement in current extension of term negotiations

Exploration Projects

Shay Gap Iron Ore

Gravity anomalies in potential Detrital Iron Deposit (DID) positions are being drill tested, aiming to locate palaeo-channel ore positions

Black Range Nickel-Copper-PGM

Surface EM surveying across highly anomalous nickel-copper-PGM soil anomalies was completed and a drilling program is proposed in the December 2011 Quarter to test these geochemical and EM anomalies

Mt Zephyr Base Metal

Seven diamond holes completed for 3,227, sulphides intersected in all holes, with most significant intersection of 9m @ 0.67% zinc and 0.16% lead
Drilling confirms distal iron rich zone of a VMS system, exploration target is to now define the high grade proximal part of the VMS system
Down-hole EM has defined the next round of drill targets

Mt Zephyr Gale Gold

Strong gold anomaly of 50-273ppb over 800m of strike, 37 hole RAB program planned to test the anomaly

Binneringie Gold

A 411m diamond drill hole was completed to test a discrete circular magnetic anomaly, strong magnetite-pyrrhotite-pyrite-chlorite alteration at 100-172m, assays awaited

Bare Hill Gold

Reconnaissance RAB drilling identifies significant anomalous zone over 2,000m
confirmed a mineralized system with intercepts including 8m at 1.76g/t gold and 4m at 2.79g/t gold

A1 Gold Mine - Sale agreement and IPO

Heron entered into an Agreement with Gaffney's Creek Gold Pty Ltd and A1 Consolidated Gold Ltd relating to interlinked transactions which will result in:

A1 Consolidated Gold acquiring the A1 Gold Mine in Victoria;
Heron and Gaffney's Creek becoming foundation shareholders in A1 Consolidated Gold; and
A1 Consolidated Gold listing on the ASX through an IPO of its shares.

It is expected that a Prospectus will be lodged in late 2011.

See the A1 Gold Mine page for full details of Heron's work at A1.

Massive sulphides, Mt Zephyr Project

Ian Buchhorn, Investor Relations

Any enquiries at all, give Ian a call on (08) 9215 4444 or email.

Discovering and Developing World Class Ore Bodies