GRANGE RESOURCES LIMITED. — Interim / Quarterly Report 2003

Mar 5, 2003

RESOURCES LIMITED A.C.N. 009 132 405

RANGE

STOCK EXCHANGE ANNOUNCEMENT

HALF-YEARLY RESULTS

6 March 2003

The directors of the Company are pleased to release the half yearly report for the period ended 31 December 2002. The group generated a consolidated net operating loss after providing for income tax of $$1,682,000$ (2001: \$536,000) for the period. The net operating loss included a number of expenditure items including the following:

• Mine operating expenses of \$969,000
• Amortisation expenses of \$148,000
• Board and payroll costs of \$446,000 $\mathbf{w}$

A net cash deficit of \$6,672,000 was generated during the period and consisted of the following:

• A net cash deficit of \$3,028,000 after allowance for revenues, relating to the operating activities associated with the mining of the Reward Deeps/Conviction underground mine and general administration costs;
• A net cash deficit of \$1,477,000 related to financing activities associated with the share buy-backs implemented by the Company; and
• $\sim$ A net cash deficit of \$2,167,000 related to operating activities associated with the mine development of the Reward Deeps/Conviction underground copper mine and provision for funding of the Company's rehabilitation obligations.

Mining Activities

Reward Deeps and Conviction Project

Development of the Reward Deeps/Conviction underground copper mine continued throughout the half year with work focussed on preparing the Conviction, B Lens and Chimney ore bodies for stoping. By the end of December production stoping in the upper levels of the Conviction ore body had commenced and stope drilling was underway in B Lens. Ore production for the quarter was 77,000 tonnes the majority of which was development ore. Stoping is scheduled to commence in the B Lens ore body during January 2003 and in the Chimney ore body during February 2003. Production from the Reward Deeps ore body is scheduled to commence during May 2003.

The Thalanga concentrator commenced treating development ore from the underground mine in October 2002. During the period, 96.269 tonnes of ore grading $5.58\%$ copper were processed through the Thalanga plant for the production of 18,033 tonnes of copper concentrate containing 27.32% copper and 0.8 $g/t$ gold. Copper recovery and concentrate grade steadily increased during the commissioning of the new ore and by the end of December were close to budget.

A.C.N. 009 132 405

GRANGE

RESOURCES LIMITED

Highway Project

Rehabilitation of the Highway and Reward waste rock dumps commenced during the December 2002 quarter. At the end of the period approximately 70% of the reshaping and 80% of the oxide capping layer had been spread. Preparations for the revegetation of the dumps had commenced during the period.

Exploration

Four underground diamond drill holes into the top of the Lower Reward Deeps resource have returned encouraging intersections including 16.2m (a) 3.54% Cu in UG02 062 and 3m (a) 4.38% Cu in UG02 060. An underground diamond-drilling programme to test a 100-metre zone vertically below the known deposit has been designed. Drilling commenced on 22 January 2003 and should be completed during the March quarter.

Freshwater

Placer Dome Asia Pacific confirmed that mining at Red Hill was scheduled to commence during February 2003 at the rate of 1.5 million tonnes per annum, with the ore to be processed through the Paddington mill.

Red Hill

Mining at Red Hill is scheduled to commence during February 2003 at a rate of 1.5 million tonnes per annum. The ore is to be trucked to the Paddington mill for processing.

Corporate Activities

At the Company's annual general meeting shareholders approved the terms of a Selective Share Buy-Back Agreement with Callanish Interests Pty Ltd a company associated with the former managing director Mr Don Hagans, to acquire 5,681,683 fully paid ordinary shares at a price of \$0.11 (amounting to a total price of \$624,985) and 26,830,168 preference shares for a total price of \$1.00. The selective share buy-back and cancellation of securities was completed on 27 November 2002.

In December 2002 the Company announced its intention to implement an on-market share buy-back for the purpose of capital management. Under the terms of the on-market share buy-back the maximum number of shares that were to be bought back over a six-month period was 7,361,691. At the end of the period the total shares bought back by the Company pursuant to the on-market share buy-back was 4,200,181 with the total consideration being \$852,464.

A.C.N. 009 132 405

GRANGE

RESOURCES LIMITED

For further information in relation to this announcement or the Company, visit the Grange Resources Limited website at www.grangeresources.com.au or alternatively contact Mr Adam Rankine-Wilson (Managing Director) on (+618) 9321 1118.

ALEC PISMIRIS Company Secretary