Metallurgical Testing

A 130kg bulk sample from holes RC01 and RC03 was delivered to Promet Engineering for metallurgical test-work. Results from these tests indicate Mt Oscar ore can produce a saleable concentrate using conventional crushing, grinding and flotation techniques. Silica levels in concentrate were successfully reduced from a worst case level of 17.2% to 6.9% using Reverse Flotation. Mass recovery levels from ore to concentrate are expected to be similar to those of other magnetite projects in the Pilbara. The company is confident that a target level of 5% silica in concentrate can be achieved given that average silica levels are below that of the bulk sample. Further metallurgical test-work is planned to confirm this silica reduction strategy and to optimise reverse flotation techniques..

Background

The Mt Oscar project area is on granted Exploration Licence E47/1217 located 30km south of the port of Cape Lambert (see Figure 1). This location gives the project massive advantages in terms of access to infrastructure and vital services. Gas, water and power are all within 20km of the project and port facilities are 30km from the project.

The Mt Oscar magnetite mineralisation is hosted within sub-vertical and outcropping Banded Iron Formations (?BIF?) of approximately 10kms strike length which are part of the Cleaverville Formation. The Cleaverville Formation hosts several other major magnetite projects in the Pilbara region.

These BIF?s are coincident with a regional magnetic high. A detailed airborne high resolution magnetic survey flown in August 2007 defined five discrete magnetic anomalies which are particularly strong in intensity - 50,000nT above background (see Figure 3). These anomalies are approximately twice the intensity of those associated with the Cape Lambert (MCC) and Cape Preston (Sino Iron) magnetite projects. Rock chip sampling and field mapping conducted early in 2008 confirmed these anomalies.

Drilling Programs

Due to the rugged topography within the Mt Oscar project area and lack of ground access diamond drilling was done with a helicopter supported rig and holes were collared where suitable access was available at the top of BIF ridges. A helicopter supported diamond drilling program commenced on 16 June 2008 at the two highest priority anomalies, Anomaly 1 and Anomaly 2 with a total of seven holes drilled for 694 metres. Magnetite mineralisation was intersected within BIF units of up to 80 metres apparent thickness.

An access track was bulldozed to Anomalies 1 and 2 during August 2008 in preparation for the RC drilling program. RC drilling commenced on 4 September 2008 using a track mounted rig with holes being collared near the base of the BIF ridges to test extensions of mineralisation at depth. Magnetite rich BIF horizons of up to 178 metres in apparent width have been encountered at Anomaly 1 and 2 which both have a strike length of approximately 1km.

A total of 27 RC holes have been drilled for 5,283 metres (see Figure 2). A total of 713 DTR samples have been sent to Amdel laboratories in Kewdale for processing. Further DTR results are expected later in February and March.

Resource Estimate

Data from the RC and Diamond drilling programs conducted at Mt Oscar during 2008 will be used to produce an initial resource estimate for the project. This resource estimate should be completed by the end of the first quarter 2009.

Planned Exploration

Further RC drilling programs are planned for Anomalies 3 and 4 during the second quarter of 2009. Field mapping has indicated the presence of similar widths and quality of magnetite mineralisation at these locations.

Table 1: RC Drilling Intercepts at Mount Oscar

1.      Intercept widths are apparent not true

2.      Sample intervals are based on 4 meter composites

3.      Each composite is individually tested by DTR, with all composite results averaged for the interval

4.      Minimum interval 20 metres, maximum internal waste 8 metres

5.      DTR head samples prepared to nominally 80% passing 25 micrometers

6.      Assays performed by AMDEL Limited (IML laboratory) with chemical analysis by X-ray Fluorescence Spectrometry (XRF).

-ENDS-

For further details please contact:

Bruno Seneque, Managing Director                       +61 8 9318 5600

Warrick Hazeldine ? Purple Communications       +61 8 6314 6300

About Fox Resources

Fox Resources is a nickel focused metals developer, with a substantial resource footprint in the world-renowned Pilbara region. Fox?s Radio Hill project has been producing and shipping nickel and copper concentrate for more than four years. It was placed on care and maintenance during 2008 following adverse movements in nickel prices.

The project offers the advantages of established infrastructure, including a new 84 man village, a 425,000 tonne per annum nickel processing plant, a fully developed underground mine at Radio Hill and concentrate storage facilities at the Port of Dampier, 40km from the Radio Hill Mine. The concentrates produced at Radio Hill are also high value due to their low levels of magnesium oxide and arsenic.

Fox Resources has an off-take arrangement in place with marketing partner Jinchuan Group Limited - China's largest producer of nickel, and a major Fox Resources shareholder. The Company has also the benefit of a highly experienced Board and management team, with particular expertise in the development of major nickel projects.

The Company is also advancing its substantial Mount Oscar magnetite project in the Pilbara, where it is working to deliver an initial JORC resource estimate during the first half of 2009.

COMPETENT PERSON STATEMENT

The information in this report that relates to exploration results, mineral resources or ore reserves is based on information compiled by Mr Neil Winfield who is an employee of the company and is a member of the Australasian Institute of Mining and Metallurgy. Mr Winfield has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ?Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves?. Mr Winfield consents to the inclusion in the report of the matters based on his information in the form and context in which it appears

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