COKAL LIMITED — Capital/Financing Update 2006

Aug 13, 2006

Monday, 14^th August 2006

MARKET ANNOUNCEMENT

Recapitalisation and Appointment of New Board Ωf Directors

The Company is pleased to announce that further to the results of the General Meeting of the company held on the 3^rd August 2006, the Subscription Deed between the Company and the representatives of the syndicate of investors (the Investors) was completed on the 8^th of August 2006, resulting in the recapitalisation of the Company and appointment of a new Board of Directors.

As a result of the completion of the Subscription Deed, the Company has issued 80,000,000 Ordinary shares at an issue price of 0.3 cents per share to the Investors and 52,500,000 options with an exercise price of 0.4 cents per share and a 5 year term to the members of the New Board of Directors.

As per the Subscription Deed, major shareholders Queste Communications Limited (QUE) and Strike Resources Limited (SRK) have transferred their total holdings of 30,672,288 shares to the Investors.

The Recapitalisation has put the company in a much stronger financial position, with net assets of approximately \$0.2 million.

The new Board of Directors is as follows:

$1₁$ Hariinder Kehal

Mr Kehal with a Bachelor of Science (Hons) from the University Of Western Australia and Master of Mineral and Energy Economics from Macquarie University is a geologist with over 20 vears experience in precious metals, industrial minerals and base metals within Australia. China and Vietnam. He has extensive experience in project evaluation, feasibility studies, joint venture negotiations and statutory reporting.

Mr Kehal was instrumental in the discovery of the one million ounce Golden Cities gold deposit, near Kalgoorlie. Western Australia in 1998 in his capacity as Exploration Manager with ASX listed AMX Resources Ltd. He has also played a major part in the discovery of other gold deposits, including Hurricane/Repulse in the Northern Territory and Transvaal, King Street, Back of Beyond and Jupiter in Western Australia, He has wide experience in presentations at board level and to analysts, brokers and fund managers, Mr Kehal is responsible for the day to day activities of Hub Resources Pty Ltd. He is currently also the Chief Operating Officer of ASX listed company AXG Mining Ltd.

$\mathcal{P}$ Godfrey Rule

Mr Rule with a Bachelor of Commerce from the University of Western Australia has over 30 vears experience in the merchant banking and resource industries in Australia and overseas. He has been a founding director of a number of ASX listed resource companies including Gloucester Coal Ltd and AMX Resources Ltd. Until recently he was a director of Western Pacific. Symetry and Select Asset Management. He is currently the Chairman of MMC Asset

ALTERA CAPITAL LIMITED

A.B.N. 55 082 541 437

813 Wellington Street, West Perth WA 6005 $T$ | (08) 9321 2642 $F(08)$ 9322 1385 Management. Until early 2005 he was a director of Orient Resources Holdings Pty Ltd with projects in China.

3. Bradley Abbott

Mr Abbott is the founding director of Abbott's Pty Ltd, a Chartered Accounting Practice based in Perth. Western Australia. The Practice also undertakes management consulting and corporate advisory services in Western Australia. He has been in public accounting since 1975 with main areas of specialty of small business, agricultural, mining, and estate planning. Mr Abbott holds a Bachelor of Business degree form Curtin University, is a Fellow of the Taxation Institute of Australia and the Institute of Chartered Accountants and is a registered company auditor.

Mr Abbott has had close involvement in the corporate management of business' involved in manufacturing equipment for the mineral processing industry, He is Chairman of Palmteg Ltd, a past director of Orient Resources Holdings Pty Ltd and several other large private companies.

$\overline{4}$ . Jeremy Shervington

Mr Shervington operates a legal practice in Western Australia, He specialises in the laws regulating companies and the securities industry in Australia. Mr Shervington has since 1985 served as a director of various ASX listed companies as well as a number of unlisted public and private companies. Mr Shervington is currently a director of the following ASX listed companies: Prairie Downs Metals Ltd, Australian Zircon NL, Emerald Oil & Gas NL and Biron Apparel Limited.

It is the intention of the new Board of Directors to introduce one or more projects into the company and then seek re-admission to the Australian Stock Exchange.

The Company wishes to announce that Mr Bradley Abbott has been appointed Company Secretary.

The Company further wishes to announce that the Registered Office and Principal Place of Business of the Company will now be located at 813 Wellington Street, West Perth WA 2005.

Further information:

Bradley Abbott Company Secretary T | (08) 9321 2642 E | brad@abbotts.net.au