GRANGE RESOURCES LIMITED. — Share Issue/Capital Change 2003

May 21, 2003

FRANGE RESOURCES LIMITED A.C.N. 009 132 405

STOCK EXCHANGE ANNOUNCEMENT

NEW SHARE ISSUE AND CANCELLATION OF OPTIONS

22 May 2003

Grange Resources Limited ("Grange" or 'the Company") advises that it has today issued 500,000 ordinary fully paid shares to Mr Ludger David Kohmascher, a former executive director of the Company, following the exercise of 500,000 options issued to Mr Kohmascher pursuant to the Grange Resources Limited Directors' and Officers' Option Plan.

Grange further advises that Mr Kohmascher has agreed to cancel the remainder of his option holding for nil consideration payable in respect to the act of cancellation, representing 250,000 options. The Company will cancel these options immediately.

An Appendix 3B is attached advising of the issue of shares and the cancellation of options.

The Company intends to utilise part of the proceeds of this share issue to fund the redemption of 46,339,663 convertible redeemable preference shares in accordance with Article 2A of the Company's Constitution. The Company will shortly issue a redemption notice to all holders of convertible redeemable preference shares. The notice will contain all relevant information in relation to the terms of the convertible redeemable preference share redemption.

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 Alec Pismiris on (+618) 9321 1118.

ALEC PISMIRIS Company Secretary

S/MA - Entergosses/Grange/Compliance/ASX/ASX Annonnemients/0917 dec

Appendix 3B

New issue announcement. application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX's property and may be made public.

Introduced 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002.

NAME OF ENTITY

Grange Resources Limited

ABN

80 009 132 405

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

⁺Class of ⁺securities issued or to $\mathbf{1}$ be issued

Ordinary Fully Paid Shares

• Number of ⁺securities issued or to $\overline{2}$ be issued (if known) or maximum number which may be issued
• $\overline{3}$ Principal terms of the ⁺securities (eg, if options, exercise price and expiry date; if partly paid *securities, the amount outstanding and due dates for payment; if *convertible securities. the conversion price and dates for conversion)

500.000

Not Applicable

• See chapter 19 for defined terms.

4	Do the securities rank equally in all respects from the date of allotment with an existing class of quoted *securities?	Yes
	If the additional securities do not rank equally, please state: the date from which they do ۰ which the extent to they participate for the next dividend, case of a $fin$ the trust, distribution) or interest payment the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment
5.	Issue price or consideration	unlisted options issued under the Grange Resources Limited Directors' and Officers' Option Plan.	12 cents per share and pursuant to the exercise of
6	Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets)	The Company intends to utilise part of the proceeds of the share issue to fund the redemption of 46,339,663 convertible redeemable preference shares in accordance with Article 2A of the Company's Constitution. The remainder of the proceeds will be used by the Company for working capital.
7	Dates of entering "securities into uncertificated holdings or despatch of certificates	22 May 2003
		Number	$\overline{+}_{\text{Class}}$
8	Number and + class of all *securities quoted on ASX. (including the securities in clause 2 if applicable)	68,090,165	Ordinary Fully Paid Shares
			$+C$ lass
		Number
9	Number + class of all and *securities not quoted on ASX (including the securities in clause 2 if applicable)	46,339,663 5,075,000	Convertible Redeemable Preference Shares Options exercisable at
			12 cents and expiring 30 June 2007
10	Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Not Applicable

⁺ See chapter 19 for defined terms.

	DORUG ISSUE OF PLO FRUM ISSUE
11	security holder Is. required?	approval Not Applicable
12	Is the issue renounceable or non- renounceable?
13	Ratio in which the "securities will be offered
14	+ Class of + securities to which the offer relates
15	determine *Record date to entitlements
16	Will holdings on different registers (or subregisters) be aggregated for calculating entitlements?
17	Policy for deciding entitlements in relation to fractions
18	Names of countries in which the entity has *security holders who will not be sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7.
19	Closing date for receipt оf acceptances or renunciations
20	Names of any underwriters
21	Amount of any underwriting fee or commission
22	Names of any brokers to the issue
23	Fee or commission payable to the broker to the issue
24	Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of *security holders

Part 2 - Bonus issue or pro rata issue

⁺ See chapter 19 for defined terms.

25	the issue is contingent Ħ on "security holders" approval, the date of the meeting
26	Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled
27	If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders
28	Date rights trading will begin (if applicable)
29	Date rights trading will end (if applicable)
30	How do *security holders sell their entitlements in full through $\mathbf{a}$ broker?
31	How do *security holders sell part of their entitlements through a broker and accept for the balance?
32	How do *security holders dispose of their entitlements (except by sale through a broker)?
33	*Despatch date

Part 3 - Quotation of securities
You need only complete this section if you are applying for quotation of securities

• Type of securities 34 $(iick one)$
• Securities described in Part 1 (a)

All other securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

$(b)$

⁺ See chapter 19 for defined terms.

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

(If the additional securities do not form a new class, go to $43$ )

Tick to indicate you are providing the information or documents

35	If the "securities are "equity securities, the names of the 20 largest holders of the additional securities, and the number and percentage of additional securities held by those holders
36	If the "securities are "equity securities, a distribution schedule of the additional *securities setting out the number of holders in the categories $1 - 1.000$ $1.001 - 5,000$ $5,001 - 10,000$ $10,001 - 100,000$ 100,001 and over
-37	A copy of any trust deed for the additional *securities

Entities that have ticked box 34(b)

• 38 Number of securities for which *quotation is sought
• 39 Class of *securities for which quotation is sought
• 40 Do the *securities rank equally in all respects from the date of allotment with an existing "class of quoted *securities?

If the additional securities do not rank equally, please state:

• $\bullet$ the date from which they do
• the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment
• the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

⁺ See chapter 19 for defined terms.

41 Reason for request for quotation now

Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another security, clearly identify that other security)

42 Number and *class of all *securities quoted on ASX (including the securities in clause 38)

Number	$\overline{C}$ lass

All entities

Fees

$43$ Payment method (tick one)

Cheque attached
Electronic payment made Note: Payment may be made electronically if Appendix 3B is given to ASX electronically at the same time.
Periodic payment as agreed with the home branch has been arranged Note: Arrangements can be made for employee incentive schemes that involve frequent issues of securities.

Quotation agreement

⁺Quotation of our additional $+$ securities is in ASX's absolute discretion. ASX may quote $\mathbf{I}$ the ⁺securities on any conditions it decides.

• $\overline{2}$ We warrant the following to ASX.
• The issue of the ⁺securities to be quoted complies with the law and is not for an ٠ illegal purpose.
• There is no reason why those $+$ securities should not be granted $+$ quotation.
• An offer of the "securities for sale within 12 months after their issue will not require disclosure under section $707(3)$ or section $1012C(6)$ of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

⁺ See chapter 19 for defined terms.

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any ⁺securities to be quoted and that noone has any right to return any ⁺securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the ⁺securities be quoted.
• We warrant that if confirmation is required under section 1017F of the Corporations Act in relation to the $+$ securities to be quoted, it has been provided at the time that we request that the $+$ securities be quoted.
• If we are a trust, we warrant that no person has the right to return the $+$ securities to be quoted under section 1019B of the Corporations Act at the time that we request that the $+$ securities be quoted.
• We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action $\mathfrak{Z}$ or expense arising from or connected with any breach of the warranties in this agreement.
• $\overline{4}$ We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before $\dagger$ quotation of the $\dagger$ securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Dated: 22 May 2003

Alec Pismiris Company Secretary

⁺ See chapter 19 for defined terms.