Update on Kimber Resources Inc. (KBX)

I received the following update from Kimber's investor relations, stating that the prefeasibility study will likely be delayed until 2007. Keeping in mind that the pre-feasibility was already postponed earlier this year, an indefinite delay of the postponeed feasibility study is, in my opinion, quite disappointing. At this point, although it's a tough call, I'd have to say that I'm beginning to strongly lean in the direction of Jim Papluva's proxy drive to oust the current management and would recommend others to vote in favor of Papluva's motion. I have to give some recognition to investor relations at Kimber however, they are top notch and obviously deeply care about the shareholder base. Unfortunately, however, the continuing delays in developing the project and the failure to meet deadlines has been disappointing, to say the least. Let me know whether you will be voting for or against Papluva's proxy motion.

Milosz,

Thanks again for the email and apologies for not getting back to you on Saturday but typing long emails on the Blackberry doesn’t make a lot of sense.

Firstly, you are not alone expressing your uneasiness pertaining to the delay of the Pre-Feasibility and I think rightfully so. Management too is also disappointed and has admittedly erred by pinning down a date for delivery of the Pre-Feas without having all of the data hammered out ahead of time. As you probably know, every deposit is different and therein lies one of the major challenges because surprisingly enough even after 200 or 300 holes, an additional hole still tells us something about the deposit. The earlier delay allowed us to include the additional drilling into the block model and we had recently determined that there were more controls to the mineralization than we had first thought. Over the past few months our technical team has been working on the metallurgy of the deposit and this is the key area that needs more work right now.

Metallurgical tests to date show that gold responds very well to cyanide (heap leach scenarios) with recoveries averaging in the high 80’s low 90’s (% recovery). Silver is more problematic as is expected and typical and still requires more testing. The tests we have completed to date show that recoveries have ranges from less than 20% to 100% for silver and the research our technical team has been doing now point us to developing a recovery model for the entire deposit where we can map the different areas of the deposit and the corresponding expected recovery rates. This will allow us to pin down more closely an “average” recovery for silver. Additionally, I expect that Micon will look at varied methods of recovery to compare those (and the associated costs) with the base case heap leach scenario. Silver recovery rates seem to vary to depending on location in the deposit, grade, spatial distribution etc and all of these factors will be taken into account once the additional tests are back.

Testing is now ongoing and additional tests have been ordered and are awaiting commencement by the lab in Vancouver . I also suspect that more tests will be ordered in the future. Some of the characterization tests have come back but the more definitive column tests are not expected until early 2007.

As far as a time frame for a completed Pre-Feasibility study it is not expected before the end of December. With the bulk of the more definitive silver metallurgical tests expected in early 2007 I suspect that Micon will need that data in order to be able to deliver numbers that will be 43-101 compliant and thus would be followed by a Technical Report. Now having said all of that, rolling a Pre-Feasibility study into a Full-feasibility (Bankable) will not likely be a huge undertaking. The Company has been ahead of the curve when it comes to climatic studies, socioeconomic studies and environmental baselines all which are required for a full-feas so from that perspective we are in pretty good shape.

As you mentioned in your email, the Company will continue to put the quality of the
work and data ahead of a rushed job to meet deadlines. Our goal here is to build a mine, there isn’t an easy one out there, and we want to ensure that the proper steps are taken in order to achieve this goal. The average time frame from discovery to production these days (according to a respected mining analyst in Toronto ) is between 7 and 13 years. We’ve been at it about 4-5 so far and still think we can grow the resource as well.

Again, feel free to get in touch anytime I would be happy to clarify any additional questions you may have.

Best regards,