QUARTERLY REPORT

Quarterly Report

Three months ending
30 September, 2003

Cibaliung Gold Project - west Java, Indonesia

• Bankable Feasibility Study progressing on schedule.
• Exploration has discovered 13 new vein systems bringing the total number of vein systems in the area to 21.
• Strong interest expressed by possible project financiers.

Mt Alexander Goldfields - central Victoria, Australia

• Exploration target selection on schedule.

Corporate

• Placement to major shareholders approved and raises $1.7 million.
• Share Purchase Plan raises $2.2 million.
• Company well funded to complete Cibaliung BFS and advance its Victorian projects.

Expenditure

• Exploration expenditure during the quarter was A$596,725.

CIBALIUNG PROJECT

The Cibaliung Gold Project is located in the Province of Banten in west Java, Indonesia, approximately 150 kilometres south west of Jakarta. The Company's joint venture partner in the project is International Antam Resources Ltd, a majority owned subsidiary of the Indonesian Government's mining company PT Aneka Tambang (Persero). The Company presently holds a 77% interest in the joint venture.

Bankable Feasibility Study
The Bankable Feasibility Study is progressing on schedule and is expected to be completed in the first half of 2004. The Study is based on a project with:

• Mine life of 6 years on current resources with a production rate of 220,000 tonnes of ore per annum;
• Recovery of gold and silver by a conventional gravity - CIL processing plant;
• Annual production of approximately 70,000 ounces gold equivalent;
• Initial capital estimated at some US$30 million;
• Average life of mine cash operating costs of less than US$200 per ounce.

The major site activity during the Quarter has been being diamond drilling to obtain metallurgical samples and to provide infill intersections for resources upgrading. Four holes were completed at Cikoneng during the month being AC-55 and AC-56 (infill), and AC-57 and AC-58 (metallurgy). Significant assay results received were:

Drilling is continuing.


Strong interest in the Cibaliung Gold Project has been expressed by several potential providers of finance.

Cibaliung Exploration

The Cibaliung Joint Venture's recent exploration shows that the most prospective area for discovery of new economic gold shoots is in the south west quadrant of the KP where the pre-mineral host rocks (Honje Formation) are located and where approximately 50% of this area has no cover of younger post-mineral tuffs. This area hosts the Cikoneng and Cibitung shoots, which are currently the focus of the Company's Bankable Feasibility Study and covers the 6km² area surrounding the Cikoneng-Cibitung shoots. This assessment is based on the proximity of the known deposits, the preferred host rock, the structural setting, erosion preservation and the discovery by the JV of numerous epithermal vein systems. There is an additional economic argument in that it will be relatively easy to develop any shoots located here and include them in a future mine plan associated with development of the Cikoneng - Cibitung shoots.

As part of the resource estimate update completed in April 2003 for the Cikoneng and Cibitung orebodies a detailed structural model was prepared to assist resource estimation and this model has since been extended as an important tool for exploration targeting.

So far one new potentially economic vein deposit at Rorah Kadal and several anomalous zones have been identified in this area confirming that this portion of the KP has significant potential to host high grade low-sulfidation epithermal vein deposits with similar characteristics to Cikoneng-Cibitung. Two scout drill holes were completed at Rorah Kadal in early 2003 with narrow but encouraging results. It was decided to postpone further drilling of Rorah Kadal until field exploration over the greater adjoining area had been completed and assessed in 2003 so as to consider new targets and develop priorities for drilling. That is nearing completion.

The Company has completed detailed grid-based MMI soil sampling and mapping over an area greater than 1000 ha and immediately adjoining the Cikoneng and Cibitung shoots, which are currently the focus of the Company's Bankable Feasibility Study.

More than 30 new gold in soil anomalies were located in the 2003 programme bringing the total number of identified gold in soil anomalies in this area to 54. Some have been followed up by trenching and prospect mapping. As a result of this work 13 new vein systems have been discovered bringing the total number of vein systems in the area to 21. A parallel program of detailed structural mapping was carried out to underpin development of an improved geological map of the area and this is now being assessed by a consultant structural geologist.

It is expected that in the near future drill targets will be prioritise and drilling of those ranked highest will commence before the end of the year.

MT ALEXANDER GOLDFIELDS NL

Through its acquisitions and joint venture agreements put in place in 2002 the Company has built itself a geologically and geographically focussed land position in the historic gold producing area around Bendigo in central Victoria, Australia

The Company is undertaking exploration at its Mount Alexander Project, in the southern portion and the Sebastian/Raywood Project JV in the northern portion of the Bendigo goldfields.

The Company is targeting shallower repeats of the Bendigo type mineralization that historically yielded over 30 million ounces from this world class goldfield.

By the end of the Quarter, data review and compilation work within the two project areas held by Mt Alexander Goldfields N.L. in the central Victorian Gold Belt was nearing completion.

The study is providing a modern synthesis and interpretation to build structural and predictive models for the goldfield. It will define major structural trends that may be related to the mineralization and which may be used to target exploration in the northern and southern leases. These models will be used to select and prioritise targets for exploration drilling.

Mount Alexander (100%) & Sebastian/Raywood Projects (earning up to 80%)

In accordance with the terms of the Joint Venture Agreement the Company's interest in the Cibaliung Project increased to 77% at the end of the third quarter 2003 due to sole funding of joint venture expenditure.

The Company successfully raised $2.2 million by a Share Purchase Plan and $1.7 million from a Placement to major shareholders. The Company had cash of approximately $7 million at the end of the third quarter and in well positioned to advance its projects.

EXPENDITURE

Exploration expenditure during the quarter was A$596,725 made up of A$496,678 for the Cibaliung Project and A$100,047 for the Mount Alexander and Sebastian/Raywood Projects.

Ian Price
Managing Director & CEO
24 October 2003

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Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Consolidated statement of cash flows

* Expenditure in relation to Cibaliung Joint Venture in Banten-Java and MAG in the Castlemaine district of Victoria

Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related entities

Non-cash financing and investing activities

Financing facilities available
Add notes as necessary for an understanding of the position.

Estimated cash outflows for next quarter

Reconciliation of cash

NOTE: Following the General Meeting of Shareholders held on 7 October 2003 the Company allotted the Remaining Shares pursuant to the Shareholder Share Purchase Plan for funds received of $0.45 million and completed a Placement in the amount of $1.7 million.

Changes in interests in mining tenements

Issued and quoted securities at end of current quarter

* These notes bear interest at an interest rate equal to the 180 day bank bill swap reference rate plus 1%. The principal amount plus any interest accrued but unpaid may be converted into ordinary shares in the capital of the company at a rate of 5.5 cents per share at any time up to and including 30 June 2005.

Compliance statement

1. This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Law or other standards acceptable to ASX (see note 4).
2. This statement does give a true and fair view of the matters disclosed.
   
   
   Sign here:.........................................................Date: 31 October 2003
   (Company secretary)
   
   
   
   Print name: Andrew J Cooke
   
   

Notes

1. The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
2. The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
3. Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
4. The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.
5. Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.