EQ RESOURCES LIMITED — Capital/Financing Update 2006

Sep 3, 2006

4 September 2006

ASX Announcement

Exploration Update – Tara Drilling Commencing This Week

Icon Resources' Board of Directors would like to provide shareholders with the following update on its exploration activities.

Tara (NSW, EL 6285) - RAB drilling starting this week

Drilling will start this week to test four separate targets at the Tara project in central NSW. As well as (i) the magnetic low described in the Prospectus, Icon's recent review has identified the following targets: (ii) a westerly extension of the chargeability high;

(iii) a residual gravity response; and

(iv) a vector indicating increased alteration to the east.

Comment

(i) As described in the prospectus, Icon will be drilling the central magnetic low at Tara to investigate the possibility for a reduced granite style of gold deposit. A regional fault passes through the low in a NW direction (see Figure 1) and it is hypothesised that this may have acted as a deep-seated plumbing system allowing mineralising fluids to ascend and hopefully precipitate in economic quantities close to the surface.

(ii) The guiding model for previous exploration at Tara has been for Cobar-style mineralisation where orebodies are invariably associated with magnetic responses. These may be coincident eg Elura, or they may be significantly removed from the magnetic responses; eg the Peak Mine where a 250nT magnetic anomaly due to pyrrhotite "is centred about 250m east of the mineralisation and has masked any (magnetic) response that the mineralised body might have given" (Hinman and Scott, 1990: AusIMM Monograph 14).

The previous drilling at Tara focussed on the magnetic high and found pyrrhotite with sub-economic levels of mineralisation. Icon is targeting a previously recorded IP chargeability high which is best developed over the pyrrhotite, but which extends further to the west than the modelled source of the magnetic response (Figure 2). Icon will drill test this region for economic development of base metal and/or gold-bearing sulphides away from the pyrrhotite.

(iii) A detailed gravity survey was carried out by previous explorers which identified two discrete highs masked by the dominating effect of the underlying granite (Figure 3). Icon will test the western and more prominent of these highs.

(iv) A re-examination of the Tara core by Icon suggests that alteration increases eastwards beyond the coverage of the IP survey (Figure 4). A drillhole will be sited to test an area some 500m to the east of the existing drilling.

Icon Resources Ltd ACN 115 009 106

Suite 302, 25 Lime Street, Sydney NSW 2000 Telephone: +61 2 9279 1252 Facsimile: +61 2 9279 2727

This round of drilling will be relatively shallow (100-150m) and is designed to look for geochemical indications within the fresh rock. The holes will be cased so that diamond core 'tails' can be drilled to extend any of the holes.

Grenfell South (NSW, EL 6559) - 3D IP survey in progress

A 3D IP survey is currently being carried out at Grenfell South over a region of historical gold workings to test for evidence of mineralisation associated with possible buried intrusives interpreted in the magnetics. If the data are encouraging, follow up drilling is planned for October 2006.

Weabonga (NSW EL 6620) Geophysical surveys completed and planned

A fixed wing aeromagnetic / radiometric survey of Weabonga has recently been completed and a 3D IP survey is scheduled to start in early September (following completion of the Grenfell survey). If the data are encouraging, follow up drilling is scheduled for November 2006.

Peel Fault Project (NE NSW)

Icon is developing its model for gold along the Peel Fault and has recently applied for three more exploration licences along the fault between Warialda and Dunmore: ELAs 2805, 2806 and 2807 plus a fourth, ELA 2827, to the south east of Weabonga. As well as gold, Icon will be exploring for nickel, chrome and platinum group minerals. Figure 5 shows the locations of Icon's licences and applications in the vicinity of the Fault.

Hiawatha (NSW, EL 6291) – IP Survey postponed until December

Unseasonal heavy rains in early winter plus extensive cropping has lead to a postponement of the 3D IP survey originally planned for Hiawatha in mid 2006.

Crystal Mt Project (Old, EPM 15007) – to be relinquished

Following the disappointing drilling results from the Crystal Mt project in June 2006 as well as a re-examination of the Logan Ck molybdenum potential, Icon has decided to relinquish this licence.

For further information, contact John Bishop, Managing Director 02 9279 1252 or 0418 373 429 Digital copies of this and other reports are available on our website www.iconresources.com.au. To receive email copies of future releases, subscribe by email to $info@$ iconresources.com.au

Figure 1. Total magnetic intensity. Target T1: the magnetic low between the Tara North and Tara
South magnetic highs and the shear zone(s) interpreted to pass through this region.

Figure 2. 3D chargeability model. Target T2: a westerly extension of the chargeability high removed from the interpreted source of the North Tara magnetic high (shaded beneath the chargeability model).

Figure 3. Residual gravity. Target T3: a residual gravity response to the south of the Tara north magnetic high.

Figure 4. Target T4: an interpreted area of increased alteration to the east of the previous drilling.

Figure 5. Icon exploration licences and applications in the vicinity of the Peel Fault, NE NSW (background: total magnetic intensity plus gold occurrences).