HAMMER METALS LIMITED — Capital/Financing Update 2005

Sep 1, 2005

MIDAS RESOURCES DIMITED

ANDER DE

• Experienced and successful exploration specialists
• Pacific Rim Focus
• Targeting large or high grade mineral systems in major gold belts

Midas earning 75% interest in Uncle Sam project in world class Tintina gold belt

Will 1122 Strategic alliance with China National Gold Corp to deliver stream of projects - Midas to acquire 55% of Dongliang gold project: Shimian gold JV

AVISTE E EXEGUIDOZ AU ASSOUTO AND strategic holding in traverton Declinity Zonez Ginis & Range Af Gillinger

"Unlocking Mineral Wealth in China and Alaska"

Highlights

Re-branding Midas from an Australian focused company with a single
resource (456,000 oz gold) to a Pacific Rim explorer:

• Le Exploring the World Class Tintina gold belt in Alaska for high grade
• Strategic Alliance with China's largest gold producer to deliver a stream of advanced gold projects to Midas for JV.
• d'A Experienced Board & management Aprovenirad (dedici of discovery
• T Planning to raise around As5 million in two tranchest
• tranche 1 (professional investors) A\$2.5 M; to fund ongoing
  exploration in China and Alaska, plus provide working capital,
• A trandre 2 (est 1925 M lare 2005). Advanced Dongliang Autororea sizee 1 - accupation and exploration

"Strong leverage into gold projects in Alaska And China"

Company ShapShot

Channany Don Boyar Managing Director: Geoff Balfe Non-Exec. Director: Terry Streeter

Market Cap Issued Capital

33M options ASX Synbol MDS/MDSO S1.4M OASH Loans SI.2M

* Convertible to shares subject to shareholder approval at 8 cents/share up to max of \$700,000

S7.0M

70M shares

Michs – Gabital Stituatic

Noronshares Total No. Shares on Issue 701657

Number of shares in tranche 1 raising - up to BEACH

	AGAMODIOIS
Listed Options (25c Exp 01/12/06)	PALIKKIN
Unlisted Options (20c Exp 01/03/06)	10,205M
Unlisted Options (20e Exp 31/12/05)	TELETIM
Unister MD meeniveropir (Brond VI 2705)	HOOOM
Total Issued options.	SSASTIM

Key shareholders: Jungle Greek 15% Don Boyer 6,3%

Details of the share Placement Offer to Professional and Sophisticated TAVASTORS

ELREISING UP IO \$2.5M ENSSUE of Up to 35M shares (33% of (expanded capital) L'Pridhe based on 80% of the average of MDS share price over 5 days prior to the COSINCICELS

Midas - Use of Funds AS2.5M taisind

Alaska exploration

• Unde Sam (Au)
• Evaluation of other acquisition opportunities

China Exploration

• Dongliang (Au) due diligence, ongoing exploration
• $-$ Shman IV $(\Lambda t)$
• Evaluation of other acquisition/JV opportunities
• AUSTELE, Exploration & Working (@ 0161)
• A Fortitude mining studies and Qld Exploration
• Working Capital
• Total (this raising)

ACTES

BAS

www.netquote.com.au

Company Structure

MIDASZRESOLEROS IGED TA SARA TA TA

Mistralian Protects

Address of the Control of the EGANORS REINE (OLD) Karangaran In

ZTITOZK GENESIA (GUDAINES BR

Alaska Projects

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CHIVASIRAIESY

• Developing business relationships through our Chinese advisors to gain
• a Targeting substantial porphyry related Au, Cu-Au and mesothermal Au deposits (associated with Mesozoic accreted arcs and mega-Théanans).
• a Forming an Allance agreement with China National Gold Corp. in
• Conducting Due Diligence on Dongliang advanced gold project 300kms
  NE of Beijing large mineral system significant exploration upside.
• 4 Opportunity to expand the Alliance and include other important projects in China and Inner Mongolia.
• Wholly Owned Foreign Entity (WOFE)" formed in China, registered in
  special economic zone of Shenzhen significant commercial
  advantages for mining (e.g. three-year tax holiday, 15% tax rate)

"Midas is tapping into a stream of projects through an Alliance agreement with China National Gold Corp."

ALLIANGE DE LATIS

Dongkang Project

T, Right to acquire 55% interest in Dongliang ML for total of US\$3M
Over 18mths, subject to completion of due diligence (Oct 3^th).

• . Tollowing DD and execution of a Sale agreement Midae has a further ▉ GO days to arrange finance. Payments as follows:
• A Opion (es Ussimitud (paid)
• G Initial Payment US\$1.9M (acquires 36% equity)
• $\gamma$ Final payment US\$1.0M within 18 mths (increases equity to 55%). A

Adquisition of Other Tenements

• 1. Potential to add additional tenements in the Alliance area with Schiffeantexploration unsider Midastean acquire 70% interest by completion of a feasibility study.
• 1 * Midas has a fisk free DD period during which it can drill before making decision to buy.

New Applications

Midas 80% CNGC 20% and Midas funds 100% to completion of a REGIOULY SURV

DONITANG GOID PROJECT Geologica Isaning

• Jurassic quartz monzonite stock intruding intruded into major 310⁰ Ź. Structural corridor with gold mineralisation in fractured porphyry, on porphyry contacts and on intersections between 310 and 360 structures.
• Multiple exploration targets: diatreme breccias, sheeted vein structures, A) CIECK EXPIRECTES
• Cxidised to 50m with Au grades typically 1.5 to 2.0 gpt (4 low base W. metals) - mineralisation at intersection between NE and NW structures.
• T. Significant widths of oxidised mineralisation e.g. adit at -15m with 39m @ 2.79gpt Au and adit at -50m with 22m @ 1.60gpt Au.
• Mineralised zone outcrops systematically trenched at 40m intervals over 800m strike - only partially tested by drilling and tunnelling.
• Existing (non-JORC) gold resource currently being mined and heap Œ leached by CNGC.

Signing of Donghang MOU

Dongliang Heap leach Bad and Mine

DONGSHANPIT

OUD LEACH DUMPS

Removing Carbon for Gold extraction

Due Diffence

• A FOQUSING CON-
• E MEGILICY
• A Engineering
• AGeology/Resource
• AUDSICISCUC EXPIDITION TEICERS

We see Dongliang as an advanced exploration project with significant upside and a trial mine In existence

Shimian Gold Project - Sichuan County

a Gold and Base metal mineralisation in major structural corridor

• Regional setting involves a large granitoid body intruded into Permian
  carbonate sediments within a major crustal-scale suture zone.
• a Exploration target is a 7km long north-south section of the regional
  structure which has mineralised flexures up to 40m wide.
• r Some current artistnal mining but the target structure has not been
  Systematically sampled; Midas initial dump samples to 7gpt Au, 77gpt Ag, 24% Pb + Zn.
• Beological Brigade 405 have agreed to farm out up to 80% to Midas.
• 4 Midas has a six month option (\$50,000) to trench and sample the structure before deciding to enter into a JV.
• E Midas can earn up to 80% in stages by spending \$1.3 M within 3 years.
• Brigade 405 will provide technicians for trenching & sampling at Midas' u. Gifteration

Northern part of Shimian Project area showing Skin section of overall 7kmlong targeted Standure

Exploration Program at Shintan

• 1. Trandning and sampling to establish structure and confirm mineralisation + \$50kmin.
• Ether withdraw or a JV is formed Midas DA. procession by standard tranding and Sahipling over 7km strike APfobable cost S250KTRTRSEXESTORDV.
• 34 Given success the follow-on program would is. Clapin axian lon innaichte Non-Piob > SLOM expenditure in years 2/3.

Alaska – World Glass Indna Gold Balt

Midas Alaska Stratedy

• T Exploration deny focused and targeting a denty
  Theonsurained geologic model Nogo Type cold CEDOSTS
• 1. Pogo deposits are Intrusion Related Gold systems with
  3. potential for large tonnage and medium to high grade gold mineralisation
• E Pogo (5.5M oz @ 19gpt Au) is an U/G mine in
  Hidevelopment by Teckcominco and Sumitomo
• E Pogo type deposits occur in 90Ma granite intrusions
  La that have been rapidly emplaced to shallow grustal levels due to unroofing of metamorphic core Complexes
• A Key features induce all Au W Mo, te BrAs association and high-grade metamorphic host rocks
• The Australia Kidston and Mt Leyshon may be of this Line a

Unde Samudin Nanure

• a Unde Sam is a Kennerott (KEX) Norphan" project in the
  Mord Class Alaskan Tintina Gold Belt.
• 1 Geoinformatics has the right to acquire 100% for US\$250,000 expenditure Teaving KEX with a 2%NSR.
• a Midas can earn up to 75% for a total expenditure of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of the state of
• r Kennecott has Back-in rights as to 60% (Midas 30%) and
  Can increase to 65% (Midas 26,25%) by arranging project THE TEACH
• r KEX can exercise Back-in up to 90 days after a Midas
  A delivers a positive feasibility study and must reimburse 2 x expenditure plus carry profect to completion of a full

Unde Sam Profed

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MicEs AES & Exploration Program

• Extending geoghemical sampling over key structures and targets not covered by KEX.
• a Minimum 4 x 250m despidismond afil holes to Test key tarats (mininum kommitment US\$250,000).
• E Follow-up diamond drilling subject to results.
• k. Expanding tenement package to cover key. STUGUIC,

Summer & Eugenes Suche

• IT Chinas Stream of new Au and CultAu projects via
• PrAlaska Praxposure to World Class gold systems in
• a Australia Fortitude Resource: Seeking Strategic
  Allance With a major producer, exploring Au & Cu targats at Confors Ree, Old

Broadening Shareholder base to Ukand Nuh America commensurate with officie

The information within this report as it relates to Exploration Results, Mineral Resources or Ore Reserves was compiled by Mr Geoff Balfe. Mr Balfe is a member of the Australian Institute of Mining and Metallurgy. Mr. Balfe is competent in the field of activity being reported on and consents to the inclusion of this information in the form and context in which it appears in this report. He has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person in the 2004 Edition of the "Australian Code of Exploration Results. Mineral Resources and Ore Reserves". Geoff Balfe consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Mr Balfe is a full time employee of Midas Resources Limited.

Midas Resources Limited

973 Wellhelon Street West Perth WA 6005 (PO BOX 887, West Perth WA 6872) ATGLE

TER FOROXEZBI 5911 Fax: +61 (0) 89486 1502 Email: office@midasresources.com.au

Website: www.midasresources.com.au