GOLDARC RESOURCES LIMITED — Capital/Financing Update 2004

May 2, 2004

Cluff Resources Pacific NL

ABN 72 002 261 565

3 May, 2004

The Manager (Companies), Australian Stock Exchange, Sydney, NSW, 2000

Dear Sir,

SECURITY PURCHASE PLAN

The Company has established a Security Purchase Plan for its shareholders, in order to allocate further funds towards the successful development of its current projects.

The Plan is open to all current shareholders, and provides them with the opportunity to purchase listed shares in parcels from a minimum of \$250 up to a maximum of \$5000.

Details of the offer, together with the Plan documents, are attached below.

Yours faithfully,

Pilemann

PeterKennewell, Managing Director

Registered Office 1/30 Leighton Place Hornsby NSW 2077 Australia

Postal Address Locked Bag 3355 Homsby NSW 2077 Australia

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

Cluff Resources Pacific NL

ABN 72 002 261 565

3 May, 2004

Dear Shareholder,

SECURITY PURCHASE PLAN

(Formerly the Share Purchase Scheme)

The Company has planned a vigorous work program for the coming year, with three projects aiming to produce a positive cash flow in the near future. The exercise of options in December provided the Company with funds to complete its diamond exploration shaft at Copeton, to continue production and sales of the rubies from the mining program at Gloucester, and to meet administrative costs for the next twelve months. Little surplus funds will remain.

Your Directors are not satisfied with this situation. They feel that in order to progress the Company beyond this, and into a faster growth track, there needs to be additional effort put into ensuring both a reliable cash flow, and a complementary and well directed exploration effort. This exploration aims to demonstrate the blue sky potential of our projects. A consistent thrust on both these fronts will, we feel, ensure a rising share price over the coming year.

Accordingly we are again implementing the Company's security purchase plan to raise funds to ensure these aims are met.

We will be offering for sale an additional 10% of the Company's ordinary shares at 2.5 cents each. This is at a 20% discount on the average trading price for the five days prior to the announcement of the offer. We remind shareholders that this is strictly on a "first come first served" basis, and that previously some applicants have missed out due to high demand. Accordingly we recommend that shareholders apply as early as possible to avoid disappointment.

The Board is discussing underwriting of the first \$1.5 million dollars of the Plan, and an agreement on normal underwriting terms is expected shortly. If finalised, this underwriting will ensure that the funds are available, and that the aggressive development and exploration program proposed will go ahead.

It is intended that money raised will not be spent on administration, as these costs have already been budgeted for the next twelve months. All funds are planned to be directly spent on the development and exploration projects. If the diamond test shaft at Copeton is successful, additional prospecting drives will be necessary to more fully evaluate the deposit. If the deposit is suitable for smaller scale mining, a headframe will be necessary, and an additional shaft will be sunk for safety and ventilation reasons. A new diamond bearing horizon has been located on the Bingara diamond field, and further testing of this is necessary to demonstrate the potential of the field to contain a large diamond resource.

Whilst the Gloucester ruby processing operation has been upgraded over the last few months, two large six wheel drive trucks will need to be purchased to ensure the increased throughput. As well as production activities, the Company needs to continue the exploration program to locate primary sources for the Gloucester rubies, both around the area being mined at present, and throughout the surrounding region, where Cluff will be entitled to an increased 50% of the net profits from marketing by CPH.

Following the imminent grant of mining leases at our 100% owned sapphire mining project at Anakie, a test program will be fast tracked and a production plant established onsite. Although much of the necessary equipment is already owned by the Company, a crew will need to establish the plant, and operate it until a saleable parcel of sapphire has been produced and sold, and the mine is profitable.

Your Board looks forward to an exciting twelve months.

Yours faithfully,

Herman

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

SECURITY PURCHASE PLAN - APPLICATION FORM CLUFF RESOURCES PACIFIC NL ABN 72 002 261 565

Record Date: 3 May 2004 Offer Closes: 7. lune 2004 Purchase Price: 2.5c per share

SUB-REGISTER HIN/SRN

A Offer Choice and Payment Details

Indicate your choice below by ticking (>>) one box only

10,000 shares $@$	$20,000$ shares $@$	$50,000$ shares $@$	100,000 shares $@$	150,000 shares $@$	200,000 shares @
$2.5c = $250.00$	$2.5c = $500.00$	$2.5c = $1,250.00$	$2.5c = $2,500.00$	$2.5c = $3.750.00$	$2.5c = $5,000.00$

Record cheque details helmu

TWO YOU VEN YOU WANT YOU WANT A LONG TO
Drawer	Cheque Number	BSB Number	Account No.	Amount AS

PAYMENT INSTRUCTIONS:

• Only cheques or bank drafts in Australian dollars and drawn on a bank or financial institution in Australia will be accepted. Your cheque or bank draft must be made payable to "Cluff Resources Pacific NL". Please ensure that you submit the correct amount. Incorrect payments may result in your application being rejected.
• Payments must be made via cheque accompanying the Application Form.
• Cash will not be accepted via the mail or at the Cluff Resources Pacific NL Share Registry.
• Payments cannot be made at any bank.

B Contact Details - (please complete)

Please provide a telephone number and contact name in case we need to contact you regarding your application

I law as provided a comprisonal trainment and additional manual in owner to make to addition to gain antigry your approachant.
Home telephone number	Work telephone number	Contact name

C Terms and Conditions of the Cluff Resources Pacific NL Security Purchase Plan

• This offer of shares under the Security Purchase Plan closes, subject to the Director's discretion, at 5.00 pm on Monday, 7^th June 2004.
• The Security Purchase Plan is available to all shareholders of the Company with addresses in Australia and other jurisdictions where this offer does not contravene local law ("Eligible Shareholders"). This offer shall be deemed not to have been made in jurisdictions where it contravenes local law.
• The number of shares available for subscription under the Security Purchase Plan is limited to 10% of the shares on issue.
• Applications from shareholders will be processed in order of receipt. We remind shareholders there have been cases previously where applicants have missed out due to high demand, and accordingly the Board recommends shareholders apply as early as possible to avoid disappointment.
• Shares will be allotted by 15 June, 2004, and application money will be deposited into a trust account and shall be refunded by the Company in the event that the applications are refused.
• Eligible Shareholders agree to be bound by the Constitution of the Company, and may apply in multiples of shares from 10,000 (\$250) up to a maximum of 200,000 (\$5,000).
• The purchase price of the shares is 2.5 cents per share, representing a 20% discount on the weighted average sale price for the last 5 Australian Stock Exchange (Sydney) trading days prior to the announcement.
• Shareholders purchasing shares through the Security Purchase Plan will not be liable to pay brokerage.
• Although the price offered was a substantial discount at the time of calculation, the shares in the Company are a speculative investment, and the share price may change from day to day, and during the course of this offer.
• To accept this offer please complete the attached irrevocable application for shares and return it to Registries Limited, P.O.Box R67, Royal Exchange, Sydney, NSW, 1223 or Registries Limited, Level 2, 28 Margaret Street, Sydney, NSW, 1223, Australia by the closing date, together with a cheque in Australian Dollars made payable to Cluff Resources Pacific NL.

NO SIGNATURE IS REQUIRED ON THIS FORM

THIS OFFER IS NON-RENOUNCEABLE