GOLDARC RESOURCES LIMITED — Capital/Financing Update 2004

Jun 24, 2004

Cluff Resources Pacific NL

ABN 72 002 261 565

25 June, 2004

The Manager (Companies), Australian Stock Exchange, Sydney

Dear Sir.

DIAMOND SHAFT COMMENCES AT COPETON

Sinking of the shaft to evaluate the inferred resource of 500,000 carats of diamonds (200,000 tonnes at 250 carats per hundred tones) on the Copeton diamond field has commenced. The shaft head frame has been installed, the reinforced concrete shaft collar completed, and the shaft sunk to six metres with the first steel liner in place.

The contract for sinking the shaft was awarded to Craigs Mining Services. The shaft will be a circular steel lined shaft, which is safer to sink and more stable in the soft ground conditions expected at the base of the sediments. The shaft will be 2.4 metres in diameter, and will use 6 metre long cylindrical steel liners which are subsequently lowered into the shaft and welded together to produce a continuous shaft lining. This method, developed by Craigs Mining Services and recently used successfully at the Chariot Mine (NT), is protected by an international patent application.

Sinking will be mainly by jackpick, with some blasting envisaged during the initial Stage 1. Broken material will be removed from the shaft by vacuum ore lift, and ventilation will also be provided by this method. It is proposed that the shaft will be sunk initially to a depth of approximately 52 metres below surface, with the last few metres of lining safely secured and grouted into the hard granite bedrock.

At approximately 50 metres below surface, an exploratory crosscut and drive will be established over a total development length of about thirty metres. This development will be 2.2 metres high by 2.0 metres wide, into which arched steel sets and timber lagging will be installed as required. On completion of the level development, the shaft will be deepened to 57 metres in the granite.

Stage 2, if implemented, would entail establishment of a plat (open area) at about 57 metres depth with adequate clearance to allow rail and timber access. A development drive 2.2 metres high and 2.0 metres wide would extend from this, and vertical rises 1.2 metres square would be excavated upwards to the previous development level at 50 metres depth. These rises would enable systematic and safe sampling of the rocks from this level. Subsequent shaft deepening to 61 metres would be necessary.

For further information contact: Scott Enderby on Phone (02) 9482 4655 Fax: (02) 9482 4987 Email: Cluff@bigpond.com or Peter Kennewell on Phone: (02) 9482 4655

Yours faithfully,

$\mathcal{U}_L$

Peter Kennewell. Managing Director

Registered Office 1/30 Leighton Place Hornsby NSW 2077 Australia

Postal Address Locked Bag 3355 Hornsby NSW 2077 Australia

Tele-Communications Tel (612)9482 4655 Fax (612) 9482 4987 Internet www.cluff.com.au