Peninsula Energy Limited (Peninsula) is pleased to announce a further upgrade to the JORC-compliant Resource Estimate for the Lance uranium projects in Wyoming, USA (Lance Projects). This upgrade has been achieved by the completion of an additional 676 rotary mud drill holes completed in the seven months subsequent to the March 2012 resource estimate. The key objective of the 2012 drilling program was to increase the measured and indicated resources in preparation for commencement of mining operations at the Lance Projects. The revised JORC compliant resource estimate of 53.7Mlbs U3O8 includes a further 2.2Mlb increase in inferred resource and a conversion of 2.5Mlbs to measured and indicated category since the March estimate. The 12 month period spanning October 2011 – October 2012 has now seen in excess of 5Mlbs inferred U3O8 resource converted to the measured and indicated categories. This is more than twice the planned annual steady state production levels for the Lance Projects.Since October 2012 the drilling programme has focused on completing aquifer monitoring wells that are part of the process to include the Kendrick Production Unit in the Permit Amendment process.

Executive Chairman Gus Simpson said “We are very pleased with the recent drilling results. The programme has successfully demonstrated the ability to convert significant inferred resource to the measured and indicated categories which was the primary objective of the 2012 programme”. Drilling during the current calendar year will have a dual focus of targeting the nose of the roll front systems in the measured and indicated resource locations and to continue to convert inferred resource to measured and indicated. The targeting of the roll front noses is expected to raise both the grade and GT of the measured and indicated resources.

Updated Lance JORC-Compliant Resource Estimate – December 2012
Since the release of the March 2012 JORC resource estimate Peninsula has continued resource conversion and exploration drilling with the completion of a further 676 drill holes, the majority within the Kendrick area. Drilling during that period focused on converting resources from inferred to measured and indicated in the Kendrick area, located to the south and west of the Ross Production Unit. The drilling along the Kendrick roll front system has produced consistent thick high-grade intercepts and has been prioritised due to its resource expansion capacity and its proximity to the proposed site of the Lance Central Processing Plant. The drill density and continuity of mineralisation at Kendrick has resulted in a high proportion of inferred resources being upgraded to the measured and indicated category.

The resource has been calculated by applying a combined constraint of a grade thickness product (GT) of 0.2 contour and 200ppm eU3O8. These cut offs are considered to be appropriate for both calculating and reporting of in-situ recovery (ISR) resources at the Lance Project. The measured, indicated and inferred resources are located in host sandstones that have demonstrated positive uranium recovery from test-work. Furthermore, geological modelling of the extensive down-hole geophysical data has accurately defined the impermeable shale and mudstone horizons that form the confining horizons to the mineralised sandstones.The revised JORC compliant resource estimate of 53.7Mlbs U3O8 includes a 17% increase in measured and indicated resource since the previous estimate in March 2012. This is well in excess of the inferred to indicated or better conversion factor used in the 2012 Feasibility Study. Within the Ross Production Unit there is a combined measured, indicated and inferred resource of 11.2Mlbs U3O8 with an average grade of 518ppm and an average GT of 0.47.

At Kendrick the combined measured and indicated resource totals 4.82Mlbs U3O8 at an average grade of 497ppm and an average GT of 0.47. At Barber the combined measured and indicated resource totals 2.41Mlbs U3O8 at an average grade of 421ppm and an average GT of 0.42 (Table 2).The resource delineation and exploration drilling program was suspended at the Lance Projects in October 2012 and the rigs deployed to complete multiple clusters of aquifer monitoring wells as part of the accelerated Mine Permit amendment process that incorporates the Kendrick Production Unit in the mine planning schedule. Drilling during the current year will target the nose of the roll fronts in the areas of measured and indicated resource and conversion drilling will re-commence in February to continue upgrading existing inferred resources to measured or indicated status. Exploration drilling is also planned to re-commence at numerous sites with known mineralisation.The latest interpretation of the existing database by Peninsula’s geological team has identified and priority ranked over 500 follow-up drill targets within the Lance Projects. It is estimated that these drill targets will form the basis for on-going exploration over the next 5-10 years. Peninsula controls the majority of the surface and minerals rights in the Lance Projects Area and is currently acquiring additional locations that are considered prospective for roll front style uranium mineralisation.

Mineralised Potential
The Lance Project, operated by Peninsula’s US subsidiary, Strata Energy Inc, covers an area of over 120km² within which there is a combined total of at least 305 line kilometres (190 miles) of known stacked roll fronts. Of this total, only a small percentage has been explored, with over 90% of the drilling concentrated within the more advanced Ross, Kendrick and Barber areas. Based on the historic conversion rate from roll front length to a drill-defined resource, the mineralised potential of the Lance Project, which is in addition to the JORC-compliant resource, is assessed at between 104 and 163 Mlbs U3O8. The mineralised potential is based on an anticipated grade range of 426ppm to 530ppm U3O8. This grade range approximates the minimum and maximum modelled grades respectively.