Hawkwood Gold Exploration

Rugby is currently planning to undertake detailed exploration of areas containing gold mineralization within the Hawkwood tenements. The main focus will be the Mary Elizabeth prospect, where the geophysical interpretation of airborne radiometric data defined a 700m long potassium radiometric high coincides with an extensive zone of silica-pyrite-sericite alteration. Preliminary targeting for Rugby’s exploration on Mary Elizabeth will be testing narrow outcropping epithermal vein system at depth, similar to Newcrest Mining’s Cracow gold mine about 60km North West of the company’s project.

Historical exploration at Mary Elizabeth included mapping the old workings, rock chip sampling, trenching and shallow percussion drilling. Two trenches returned wide intervals of elevated gold including 20m of 0.62g/t Au and 21m of 0.81g/t Au. In 1989 Geopeko drilled four shallow holes drilled with the most significant intersection being:

44m to 74m = 30m of 1.89g/t Au
Including: 65m to 70m = 5m of 7.14g/t Au

Compass Resources in 1998 conducted 200m line spaced soil traverses to the north of the workings, which defined a 10 to 76ppb gold anomaly with associated arsenic, over a 150m X 800m zone. In 2005 Newcrest collected rock chip samples of silica-sericite altered volcanic rock within this zone which returned anomalous assays of 3.18g/t Au, 31.7g/t Ag and 5.24g/t Au, 46.5g/t Ag. No other work was conducted.

Rugby recommends and plans to commence an exploration program of geochemical sampling and geophysics to define potential drill targets. The EPM application 17089 has been granted and Rugby is planning on conducting work on this area in the near future.

Hawkwood Joint Venture

In January 2010, the Company entered into a joint venture heads of agreement (the “Agreement”) with Eastern Iron Limited (“Eastern Iron”) which covers certain areas identified as potential iron targets within the Hawkwood property. Eastern Iron will have an opportunity to earn up to 80% ownership in these targets after completing and incurring specific drilling and exploration expenditure requirements and conducting a bankable feasibility study. To date Eastern Iron has conducted ground and air magnetic surveys on the targets and have commenced a drilling program that is expected to be completed shortly.