Exploration Update

SERABI MINING plc ("Serabi" or "the Company")
                         EXPLORATION UPDATE


Highlights


  * Palito Main Zone continues to produce good results, which has
    recently included the discovery of a new mineralisation between
    the G2S and G3S lodes and a high-grade zone intersected
    south-west of the G1S lode.
  * Chico do Santo prospect demonstrates significant strike and dip
    extension, with three parallel zones intersected over a 200m
    strike length and 200m dip extent.
  * Further drilling at the Ruari's Ridge prospect returns
    encouraging results from two sub-parallel mineralised zones
    intersected over a 600m strike and 200m dip extent.
  * Drilling at Palito West intersects a potential new zone of
    high-grade mineralisation to the east of the previous exploration
    focus, which will become the first satellite ore source developed
    for Palito.
  * The Tatu prospect emerges as an attractive drill target following
    delineation of linear magnetic anomalies, juxtaposed to
    high-grade gold values in rock chips and soil anomalism.
  * Regional Tapajos exploration continues with green field
    exploration at Pizon and Sucuba projects.



Palito and Jardim do Ouro

Palito Main Zone
Following commencement of underground  drilling earlier in the  year,
results continue to identify areas of new mineralisation, as well  as
assisting in mine planning. Noteworthy  is the intersection of a  new
high-grade mineralised zone  between the  G2S and G3S  lodes, in  the
southern areas of the Palito Main Zone. At this location  underground
drill hole  PUD-185* intersected  1.29m @  250.2g/t Au  and  PUD-177*
intersecting 1.57m @ 43.32g/t Au, approximately 15m apart.

Underground exploration  drilling  seeking additional  zones  to  the
south-west of the  G1S lode  and south-east of  the Compressor  Lode,
also returned very  good results; PUD-182  intersecting two  adjacent
high grade zones including 0.94m @ 22.86g/t Au and 0.51g/t @ 17.10g/t
Au.

Meanwhile limited surface  exploration drilling  has continued  along
the Palito Main Zone, including preliminary drilling along the  north
and south strike extensions  of the mineralisation. Some  encouraging
results  were   obtained  in   this  area   where  weak   mineralised
intersections were  encountered  within  massive  sulfide  veins  and
breccias. A more detailed drill programme will be carried out in  the
areas during 2007.

Results to-date included:


   +-------------------------------------------------------------+
   | Palito North | Drill hole | Intersections                   |
   |--------------+------------+---------------------------------|
   |              | PDD-276    | 1.50m @ 1.31g/t Au from 72.40m  |
   |--------------+------------+---------------------------------|
   |              | PDD-277    | 1.71m @ 1.32g/t Au from 71.79m  |
   |              |            | 0.89m @ 1.63g/t Au from 76.50m  |
   |--------------+------------+---------------------------------|
   |              | PDD-283    | 0.53m @ 3.87g/t Au from 169.86m |
   |--------------+------------+---------------------------------|
   |              |            |                                 |
   |--------------+------------+---------------------------------|
   | Palito South | PDD-272    | 1.00m @ 1.17g/t Au from 66.57m  |
   |--------------+------------+---------------------------------|
   |              | PDD-269    | 0.69m @ 5.42g/t Au from 133.18m |
   +-------------------------------------------------------------+


Positive drill results along the Palito Main Zone have shown a strong
correlation with surface geophysical  surveys previously carried  out
to identify the  massive sulphide  mineralisation, characteristic  of
the gold-copper ore deposits found at Palito. Considering the  higher
costs associated with deep drilling now required to assess the  depth
potential of  mineralisation, it  is essential  that such  holes  are
located with the greatest precision possible in order to maximise the
value of each hole. Therefore in the latter part of 2006 we  deferred
further deep drilling in order to expand the geophysical programme on
surface. We  expect  a  resumption  of  deep  drilling  following  an
assessment  of  these  results   during  the  second  quarter   2007.
Meanwhile, exploration  and resource  drilling  will be  confined  to
shallower targets as  part of  the ongoing drill  programme for  mine
planning and scheduling.

Chico do Santo
This  prospect,  300m  north-east  of  the  Palito  Main  Zone,   has
demonstrated some  significant  early potential  from  earlier  work.
Recent results  from a  new drill  programme have  outlined at  least
three parallel mineralised bodies, broadly dipping 70° to the NE  and
demonstrating robust continuity along 200m of strike.

A  programme  of  shallow  reverse  circulation  (RC)  drilling   and
trenching, and deeper  diamond drilling  is now  in progress.  Twelve
(12) holes of an initial twenty  (20) hole drill programme have  been
completed with significant results including:


          +-----------------------------------------------+
          | Drill Hole | Intersections                    |
          |------------+----------------------------------|
          | RC-CS-02*  | 1m @ 3.17g/t Au from 6m          |
          |------------+----------------------------------|
          | RC-CS-04*  | 1m @ 4.30g/t Au from 80m         |
          |            | 1m @ 2.59g/t Au from 93m         |
          |------------+----------------------------------|
          | RC-CS-06*  | 1m @ 1.02g/t Au from 29m         |
          |------------+----------------------------------|
          | RC-CS-07*  | 3m @ 7.56g/t Au from 31m         |
          |            | including 2m @ 10.68g/t from 31m |
          +-----------------------------------------------+

  *Sample analysis completed at Serabi's laboratory at Palito Mine

In addition diamond  drilling; targeting  the down  dip extension  of
these lodes demonstrates the depth continuity of these lodes. Results
include:


          +-----------------------------------------------+
          | Drill Hole | Intersections                    |
          |------------+----------------------------------|
          | PDD-275    | 2.65m @ 2.65g/t Au from 161.4m   |
          |            | 1.50m @ 1.18g/t Au from 189.29m  |
          |------------+----------------------------------|
          | PDD-278    | 1.81m @ 1.73g/t Au from 183.56m  |
          |------------+----------------------------------|
          | PDD-280    | 0.95m @ 1.18g/t Au from 197.68m  |
          |------------+----------------------------------|
          |            | 0.87m @ 8.10g/t Au from 188.70m  |
          | PDD-285    | 0.50m @ 2.05g/t Au from 295.73m  |
          |            | 0.50m @ 12.34g/t Au from 323.10m |
          +-----------------------------------------------+


Results of 6.5m @ 2.62g/t Au from  a channel sample at the collar  of
RC-CS-08, (including 1.1m@ 6.1g/t and  0.5m @ 7.98g/t) and rock  chip
results including 7g/t, some 60m to the NW, demonstrate the potential
for shallow oxide mineralisation at  surface along these narrow  high
grade zones.

The ongoing exploration programme at Chico do Santo, will continue to
evaluate the potential of this prospect as a production satellite for
the Palito  operation. Drilling  and trenching  is aimed  at  further
defining the known mineralised zones and exploring for the  potential
of additional parallel zones to the north-east and south-west.

Ruari's Ridge
Located some 500m  south-west of  the Palito Main Zone, this area  of
strong gold geochemical anomalism, on the flank of a magnetic high is
currently subject to an ongoing diamond drilling programme.

Preliminary wide-spaced drilling along  this anomaly has  intercepted
two (2) sub-parallel, continuous  zones of mineralisation, which  are
interpreted as dipping steeply to  the north-east and extending  over
600m in strike and  200m down dip.  The north-west strike  continuity
has been closed, however,  the zones remain  open to the  south-east,
where  soil  geochemical   anomalism  continues   along  the   strike
projection. This south-east continuation is focus of current  diamond
drilling. Drilling will additionally explore for other possible areas
of nearby mineralization, including parallel zones to the  north-east
and south-west. Untested soil geochemical anomalism in the area  lies
to the south-east and south-west of the current drilled areas.


Significant gold results returned to date from this drilling include:


          +-----------------------------------------------+
          | Drill Holes | Intersections                   |
          |-------------+---------------------------------|
          |             | 1.00m @ 4.63g/t Au from 120.23m |
          | PDD-255     | 0.62m @ 3.21g/t Au from 302.26m |
          |             | 0.50m @ 1.85g/t Au from 346.63m |
          |             | 0.61m @ 2.19g/t Au from 357.63m |
          |-------------+---------------------------------|
          | PDD-258     | 1.07m @ 3.32g/t Au from 207.42m |
          |-------------+---------------------------------|
          | PDD-261     | 0.60m @ 3.69g/t Au from 25.3m   |
          |-------------+---------------------------------|
          |             | 0.27m @ 7.19g/t Au from 83.00m  |
          | PDD-271     | 0.49m @ 4.28g/t Au from 344.73m |
          |             | 1.55m @ 6.49g/t Au from 365.09m |
          |-------------+---------------------------------|
          | PDD-289     | 1.07m @ 1.18g/t Au from 42.50m  |
          +-----------------------------------------------+


Palito West
This prospect some 200m south-west of Palito, has been the subject of
ongoing exploration drilling. Intersections  in drill holes  PDD-270,
273 and 281 have defined a new  higher grade zone to the east of  the
previously defined zones of mineralisation at Palito West. This  zone
will now be the subject of a follow-up programme.


          +-----------------------------------------------+
          | Drill Hole | Intersections                    |
          |------------+----------------------------------|
          |            | 0.62m @ 2.28g/t Au from 122.88m  |
          | PDD-270    | 0.71m @ 1.55g/t Au from 196.79m  |
          |            | 0.66m @ 13.62g/t Au from 207.51m |
          |------------+----------------------------------|
          | PDD-273    | 0.43m @ 5.47g/t Au from 97.84m   |
          |            | 0.62m @ 2.53g/t Au from 154.24m  |
          |------------+----------------------------------|
          | PDD-281    | 1.00m @ 13.94g/t Au from 23.54m  |
          |------------+----------------------------------|
          | PDD-284    | 0.62m @ 2.04g/t Au from 44.00m   |
          |            | 0.94m @ 10.76g/t Au from 83.50m  |
          +-----------------------------------------------+


A preliminary  assessment of  the sampling  results has  demonstrated
that Palito West will become Serabi's first satellite ore production.
An 'on-lode'  shaft  sinking  operation has  commenced  and  will  be
followed by orebody development. Although  this is situated close  to
the current underground mining operation, it represents a first  step
to realising the wider potential of the Jardim do Ouro district.

Tatu
The Tatu prospect, an area  of historical artisinal mining  activity,
occurs approximately 2.5  kilometres north north-east  of the  Palito
Main Zone.  The area  contains numerous  abandoned pits  and  shafts,
which are  thought to  have exploited  a gold-rich,  magnetite-quartz
vein alteration zone. Sampling of surface float material in the  area
has returned results  including 191g/t, 30g/t,  26.5g/t and  11.25g/t
Au.

Serabi recently completed  a detailed ground  magnetometer survey  of
the area, totalling  some 16.5  line-kilometres. The  result of  this
magnetic survey demonstrates  a significant  magnetic anomaly  occurs
parallel with  soil geochemistry  anomalism and  with areas  of  past
mining activity.

A first pass drill  programme will commence on  this prospect in  the
coming months, targeting  the co-incident  magnetic, geochemical  and
historically mined areas.

Bill's Pipe
The Bills Pipe prospect approximately  500m north of the Palito  Main
Zone has  been the  focus of  an eleven  (11) hole,  shallow  reverse
circulation (RC)  drill  programme, designed  to  test a  major  gold
geochemical anomaly  and encouraging  trench sampling  results.  This
programme produced results including:


              +---------------------------------------+
              | Drill Hole | Intersections            |
              |------------+--------------------------|
              | RC-BP-08*  | 11m @ 1.67g/t Au from 1m |
              |------------+--------------------------|
              | RC-BP-06*  | 3m @ 5.81g/t Au from 27m |
              +---------------------------------------+

  *Sample analysis completed at Serabi's laboratory at Palito Mine

Based on results to-date,  the mineralisation is currently  difficult
to correlate between  drill holes,  and may be  related to  supergene
enrichment and dispersion  within the  saprolite profile  surrounding
very high grade, but narrow  zones of vein hosted mineralisation.  It
is planned  to further  assess  the potential  of the  more  coherent
supergene mineralisation through a programme of trenching.

Rio Novo South
The Rio  Novo  project,  which  lies  approximately  five  kilometres
south-east and along the interpreted strike of the Palito Main  Zone,
is the subject of an ongoing exploration and drill programme.

A six-hole diamond drilling program  targeting two areas of  historic
artisinal mining activities  and two  large gold-in-soil  geochemical
anomalies is nearing completion. Amongst results received to-date has
included:


          +----------------------------------------------+
          | Drill Hole | Intersections                   |
          |------------+---------------------------------|
          | FRN-002    | 0.60m @ 2.32g/t Au from 117.40m |
          +----------------------------------------------+


A review of the future exploration programme on the Rio Novo  project
will be completed  once the  current programme is  completed and  all
results have been obtained.


Tapajos Regional

Pizon
A campaign of broad spaced soil geochemistry, field mapping and  grid
auger drilling has been completed over  the immediate area of an  old
artisanal  mining  area.  A  regional,  first  pass  stream  sediment
sampling programme  has also  been commenced  on the  Pizon  tenement
holdings.

The geochemistry and field mapping programme is aimed at extending an
area of  known  anomalism  and better  defining  areas  for  detailed
follow-up. The auger  drilling programme  is focused  on an  historic
discovery hole drilled by Rio Tinto, which reported 32m @ 5.2g/t  and
is designed to target a possible follow-up drill programme.

Results from  the  geochemistry  and  auger  sampling  campaign  have
defined two gold soil anomalies,  which correspond to intrusive  acid
porphyry bodies emplaced in an acid volcanic terrain. These intrusive
bodies  are  intensely   fractured  and   associated  with   potassic
alteration.

The Pizon  project will  continue to  be a  focus for  more  regional
exploration being undertaken in the tenements surrounding the defined
anomalism. Stream sediment sampling will continue to project a  broad
coverage screening of  the area, and  follow-up surface  geochemistry
will be undertaken in  the anomalous areas  defined to better  target
future drilling programmes.

Jutai
A review of the Jutai project is currently in progress. Previous work
indicates  the   presence  of   gold  hosted   within  a   saprolite,
characterised by fine-grained free gold which is amenable to  gravity
based separation.  This  review  is  now  focusing  on  the  historic
resource area and  will include preliminary  metallurgical test  work
and a more detailed assessment of the nature of the mineralisation.

Sucuba
An extension of the soil geochemistry programme has been completed  a
further 1.2  kilometres west  of the  existing geochemical  grid  and
previously reported in our September 2006 Exploration Update. Results
confirm a westward continuation of the gold-in-soil anomaly, although
of weaker tenor, for a further one kilometre, which remains open.

A drill programme will be carried out to extend and better define the
more significant exploration results from drill holes reported in the
previous update.

Technical and geological information in this report has been read and
approved by Serabi's  Chief Geologist, Mr  Chris Spurway. Mr  Spurway
BSc (Honours) is a graduate of  the University of Sydney in  Geology.
He is a  member of the  AusIMM and has  worked for over  16 years  in
mineral exploration including three years in Brazil.

All preparation and analysis  of samples have  been completed at  SGS
Laboratories, Brazil unless marked(*),  which indicates results  from
the Company's own laboratory, awaiting independent validation.


Enquiries

Serabi                                   Numis Securities
Mining                                   Limited
plc
Graham    Tel: [phone]             John Harrison      Tel: 020
Roberts                                                     7260 1234
Chairman  Mobile: [phone]           James Black        Tel: 020
                                                            7260 1234

Clive     Tel: [phone]             Parkgreen
Line                                     Communications
Finance   Mobile: [phone]          Simon Robinson     Tel:     020
Director                                                    7851 7480

E-mail:   [e-mail]       Clare Irvine       Tel: 020
                                                            7851 7480
Website:  www.serabimining.com           [e-mail]

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