A Total Nickel Focus

Delivering Value from Nickel Laterite

Annual General Meeting24 November 2006

Ian BuchhornManaging Director

Heron Resources Limited

ASX: HRR

Disclaimer Forward Looking StatementThe material used in this presentation is intended to be a summary of selected geological data, current and proposed activities, as well as resource estimates based on information available to Heron Resources at the time. It does not include all available information and should not be used in isolation as a basis to invest in Heron Resources. Any potential investor should refer to Heron Resources’ ASX releases and statutory reports before considering investing in the company.This presentation includes information relating to a completed independent scoping study, completed independent resource estimate and a feasibility study which is in progress and includes “forward looking statements” which include, without limitation, estimates of potential nickel in concentrate production based on mineral resources that are currently being evaluated. While the Company has a reasonable basis on which to express these estimates, any forward looking statement is subject to risk. Risks include, without limitation: nickel metal prices, foreign exchange rate movements, failure to meet joint venture milestones, project funding capacity, concentrate off-take contracts and estimates of future capital and operating costs.The Company does not undertake to release publicly any revisions to forward looking statements included in this presentation to reflect events or results after the date of this presentation, except as may be required under applicable securities laws.

Company Profile – CorporateListed ASX August 1996

• Focus on acquisition and exploration to develop long life nickel mines

Capital Structure• 168m shares at A$0.80, mkt cap A$134m• A$5.9 million cash at bank, debt free

Significant Shareholders• Directors and associates 25.5%• Inco Limited 9.9%• BHP Billiton 9.6%

KNP Terms and ProjectSubject to meeting technical milestones, Inco sole funds Feasibility Study

• Pre-Feasibility, minimum US$18m

• Full Feasibility, minimum US$50m

Inco earn 60% oncompletion of Feasibility and securing project funding

• Inco procures all project debt funding

• Heron equity fund cap 4.5% of total equity

• Inco lends Heron its remaining equity funds

Inco Farm-in -Timing Milestones Step 1, confirm 120mt at 1.5% Ni

• Diamond drilling, screening studies• Completion July 2006

Step 2, flow sheet selection • Batch metallurgy and mini-pilot, Sep 2007

Step 3, resource and engineering• Resource drill out, plant design, Jan 2009

Feasibility Study• Bankable, completion deadline July 2011

Completed

Commenced

Step 1 Work ProgramPQ triple tube diamond drilling

• 53 holes twinning RC and DD holes, included sonic Drilling

• Confirmation of previous head assays• Beneficiation test work, 1.5% Ni LFG

Geological re-logging of all prospects• Focus on metallurgical material types

Volume estimation

Material Types In CorePlaty CUS

MagnesiticCLN

CLF

Beneficiation: how it works

Scrubbed slurryinto pilot plant

trommel screen deck

Screened rejectsSilica fragments 60%Reject grade 0.3% Ni

Screened slurryLimonite 40%

Leach feed grade 1.5% Ni

Screen Upgrade

Inco’s Conclusions to Step 1“KNP is a large nickel resource in a political stable region with good existing infrastructure which has the potential to achieve the Assumption tonnes and grade.” Leach Feed of 120mt at 1.5% Ni

“KNP is one of the better undeveloped nickel laterite opportunities in the world.”

“No fatal flaws detected during Step 1, but the core drilling, interpretations and database interpretation raised geological issues previously not recognised that need addressing during Step 2.”

Step 2 ProgramCovers first 6 months only estimated at US $2m

• Bench Scale Metallurgical Tests, 100 samples for

HPAL and AL, settling and rheology tests.

• Crushing, attritioning and scrubbing crushing

optimisation evaluate beneficiation options.

• Bulk metallurgical tests, three, 500kg semi

continuous pilot high pressure leach runs.

The Right Location

Infrastructure

KALGOORLIE

ESPERANCEKWINANA

RailGasRoadPorts

Esperance

Kalgoorlie

Leonora Laverton

Murrin MurrinRefinery

Kalpini

Bulong

Goongarrie

KNP

Sulphides and Second Heap Leach

Jump-up Dam

Heron Nickel Strategy

Time

-29.2 °

-29.5 °

-29.8 °

-29.5 °

-29.2 °

Legend:

Heron tenements

Ultramafic lithologies

0 10 20

Kilometres

Kookynie

-29.8 °

Kalgoorlie120km

MurrinMurrinnickellateriteprojectarea

Jump-up Dam Heap Leach Project 100% Heron owned and managed: outside of KNPFocus on lower capital intensityTested technologyIncremental growthResource drilling and test work continuingNickel production

Aubils

Boyce Creek

Jump-up Dam

Murphy Well

Mt Remarkable

50km

50km

Nickel Lateriteresource targets

E31/524

P31/1697

P31/1669

E31/664P31/1698

6712000 mN

6714000 mN

6710000 mN

0

24m @ 1.07% Nifrom 10m

22m @ 1.53% Nifrom surface

16m @ 0.89% Nifrom 20m

22m @ 0.79% Nifrom 10m

16m @ 0.90% Ni from 4m20m @ 1.15% Ni from 4m

28m @ 1.24% Nifrom 4m

44m @ 0.91% Ni from surface

50m @ 1.07% Ni from surface

38m @ 0.76% Ni from 2m

Drilled RC Drillhole

Max Ni % over 2 metres>1.51 to 1.50.75 to 10.5 to 0.750.25 to 0.5<0.25

54m @ 1.35% Ni from 18m

24m @ 0.85% Ni from 13m

Intercepts are basedon a 0.5% Ni cut-off

Current drill program-results pending

WesternZone

Eastern Zone

EasternNontronite Zone

Mineralisation Outline

Jump-up Dam Intercepts

640

Metres

LegendHeron Tenements

Ultramafic Outline

Jump-up Dam Infill DrillingLegend

Heron Tenements

Mineralisation Outline

Current drill program-results pending

Drilled RC Drillhole withmax Ni

Ultramafic Outline

0 640Metres

Drilling Ni % intercepts>1.51.25 to 1.51 to 1.250.75 to 10.5 to 0.75

Size by width of intercept

Top 15 intercepts based onNi% x width are labelled

4-12m

>40m24-40m12-24m

6712000 mN

6714000 mN

E31/524

P31/1697

P31/1669

E31/664

P31/1698

40m @ 0.91% Nifrom 14m 44m @

1.03% Nifrom surface

38m @ 1.05% Nifrom 22m39m @ 1.09% Ni

from 26m

46m @ 0.93% Ni from 12m

28m @ 1.24% Nifrom 4m

50m @ 1.07% Nifrom surface

Intercepts are basedon a 0.5% Ni cut-off

WesternZone

Eastern Zone

EasternNontronite Zone

54m @ 1.35% Nifrom 18m 44m @ 0.91% Ni

from surface

34m @ 1.14% Nifrom surface

26m @ 1.42% Nifrom surface

38m @ 0.98% Ni from 24m

44m @ 0.83% Nifrom surface

26m @ 1.31% Nifrom 28m

28m @1.29% Nifrom 26m

Jump-up Dam Drill Sections

Legend

Cover

Upper Clay

Upper Clay mineralisation

No vertical exaggeration

22m @1.53% Ni 22 metres

at 1.44%Nickel grade

Zone of mineralisation

Lower Clay mineralisation

Lower Clay

Ultramafic bedrock

Section 1920N

Western Zone Section 3200N

400RL

360RL

320RL

Eastern Zone

360RL

320RL

400RL

24m @1.07% Ni

28m @1.24% Ni

22m @1.53% Ni

50m @1.07% Ni

38m @0.76% Ni

44m @0.91% Ni

Garnierite delivering exceptional Ni%High grade zones identified with garnieriteGarnierite mineral can host up to 30% nickelCommonly grades better than 2% Ni in drillingVery amenable to leachingHas siliceous matrix for heap strength

Jump-up Dam Heap Leach Project

Jump Up Dam testwork results

Nickel Extraction v Time

0

10

20

30

40

50

60

70

80

0 20 40 60 80 100 120 140 160Time, days

HL06 Comp. HL07 Comp. HL03 Comp. HL04 Comp. HL05 Comp.

Calcrete

Stage 1Neutralisationwith Calcrete

PrecipitationStage

BarrelAgglomerator

Dilute acid solutionrecirculating

Acid addition

Heap stackingconveyor

Filtering and drying

Intermediate ProductBulk Bags

Shipping from Esperance

ConveyorCrusher

Mining

Crushed ore stockpile

Fine ore after crushing

Recycling of process water

Reticulated solution

Agglomerate nodules in heaps

Zero discharge site

Agglomeration with acid

Calcrete mining

ROM Stockpile

Acid supply

Goldfields

Jump-up Dam Heap Leach Flow Sheet

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun

2007 2008 2009OverviewJump-up Dam Project

Scoping study flow sheet

Key Issues• Resource drilling and estimates• Acid Supply and off take agreements• Site evaluation• Mining lease grant• Test scale heaps• Precipitation plant design

Scoping Study

Prefeasibility Study

Bankable Feasibility Study

Decision to MineConstruction

Commence ProductionRamp up to 5,000 tpa NickelRamp up to 10,000 tpa Nickel

Nickel production slide here

WA Nickel Production 2004-2005

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000Ni Tonnes

Heron Corporate Target

Jump Up Target 2

Jump Up Target 1

0

20

40

60

80

100

120

140

160

01-Dec-03

01-Mar-04

01-Jun-04

01-Sep-04

01-Dec-04

01-Mar-05

01-Jun-05

01-Sep-05

01-Dec-05

01-Mar-06

01-Jun-06

01-Sep-06

DateM

arke

t Cap

M A

UD

Summing Up: Milestone Driven GrowthHeron is continuing to deliver on the KNP Heron is delivering on medium term Nickel project from our own portfolio: Jump-up DamHeron is delivering on the divestment on non core non nickel assetsHeron delivers on land acquisition and sulphide Value add acquisitions Scoping study

and resources

Inco JV, Placement

BHPB on Register

Execution of formal agreement

Companies and Projects

Ian BuchhornManaging Director

Phone: +61 8 9091 9253 (Kalgoorlie)+61 8 9215 4444 (Perth)

ASX: HRR