HELIX RESOURCES LIMITED — Capital/Financing Update 2004

Jul 14, 2004

15th July 2004

Manager Company Announcements Office Australian Stock Exchange Limited 10th Floor, 20 Bond Street SYDNEY NSW 2000

Dear Madam

COMPANY UPDATE - DIGGERS & DEALERS 2004

Please find following a Company Update to distributed to all Shareholders and at the upcoming Diggers & Dealers Mining Forum

Yours sincerely HELIX RESOURCES LIMITED

RICCARDO VITTINO CFO and Company Secretary

COMPANY OVERVIEW

Whilst Helix has continued to maintain an extensive portfolio of exploration projects for gold, platinum group metals and nickel throughout Australia, the company has focussed much of its effort in the past 12 months on developing a new mine at its Tunkillia Project at Lake Everard in the Gawler Craton region of South Australia.

Since purchasing the 49% share of Tunkillia held by AngloGold in May 2003, Helix has rapidly progressed the project; the resource at Area 223 has almost doubled and as the drilling continues, results have shown excellent potential for further expansion. To date the company has outlined a JORC resource of 730,000 oz of Au of which about 390,000 oz is mineable by open cut methods at the current gold price. Recently, a new project development team has been employed to oversee the transition of the project from exploration to development.

The team consisting of experienced South Australian based mining engineers and mine geologists will manage the feasibility study through to its completion in early 2005.

In addition to the development of Area 223, Helix holds tenements covering over 3,000 sq km in the Lake Everard region. The company is currently trialing new geophysical techniques to prioritise the numerous and large gold in calcrete anomalies within the tenement package.

Outside of South Australia gold exploration is continuing in the Gascoyne and Yilgarn regions of Western Australia. Exploration and resource drilling at the Glenburgh Project will be carried out in late 2004.

3D Model of Resource and Whittle Pits at Area 223

Although exploration and development of the Munni Munni PGM project was put on hold in late 2002 due to the dramatic slump in the palladium price, the Company is continuing to investigate the possibility of developing the high grade shoots within the resource. These high grade zones contain over 1.4 million oz of PGM and gold at a grade of 3.3g/t, with widths in places in excess of 5 metres. The Company maintains its positive view of the longer term future of all PGM's and will retain Munni Munni as a valuable future asset.

Limited grass roots exploration for Au and PGM's is planned for the Mt Venn and Isolated Hill projects in the far eastern portion of the Yilgarn Block of Western Australia

		Grade and Tomage	Contained Metal	Status
Au.	100%	10.5Mt at 2.2q/t Au	730,000 oz	Feasibility
PGM	100%	24.0Mt at 2.9g/t PGM + Au	2.240.000 oz	Review
Αu	100%	1.4M tat 1.9g/tAu	90,000 oz	Exploration
PGM	100%	10.2Mt at 0.6g/t Pt	200.000 oz	Exploration
Ni Co	100%	2.0 Mt at 0.18% Co & 0.35% Ni	3.6001 Co.70001 Ni	Exploration
Ni Co	49%	6.0Mt at 14%Ni &0.11%Co	84.000t Ni. 6.600t Co.	Exploration
		Commodity Equity

Resource Inventory, July 2004

CORPORATE DETAILS

Information Shares FPO Options (25c Nov 2005) Unlisted Options Share Price (07.07.04) Market Capitalisation Cash

63,866,808 16,437,863 3,962,999 $$0,18$ \$11,600,000 \$2 200,000

Directors Michael Folle Rob Mosig Tony Martin lan Macpherson Bryce Wauchope Ric Vittino

Chairman Managing Director Executive Director Non executive Director Non-executive Director CFO & Company Secretary

TUNKILLIA PROJECT

Resources Growth

Prior to May 2003, before Helix purchased AngloGold's 49% of the Tunkillia Project, AngloGold estimated that Area 223 contained approximately 220,000 oz of open cut mineable gold (at AUD\$550 gold price) grading 2.5g/t Au. In the second half of 2003 Helix conducted a 14,000 metre infill drilling program to enhance the resource. As a result AMC Consultants were able to calculate the first JORC resource estimate for Area 223 of 10.5 Mt grading 2.2g/t Au containing 730,000 oz. Optimisation studies carried out on the new resource indicated that the exploitable resource had increased to 390,000 oz of gold with a head grade of 2.4g/t within a AUD\$550 pit shell.

The studies estimated cash costs of potential production was AUD\$375 per oz of Au at a stripping ratio of 7.5:1 resulting in an undiscounted pre tax cash flow of \$62million. In addition capital costs were estimated at \$25million with the project requiring a maximum negative cash flow of \$37million taking into account the 50 metres of pre-strip required to access the supergene mineralisation.

Gold Price Contained		Grade	Strip		Remvered Cash Cost	Undisc	Cash Flow
	Gold	Gold	Ratio	Gold		Cash Flow	Minus Capital
AUD S.bz	ΟZ	αľ	w:o	OΖ	ALID S.b.z	উনা	ŠΠ
500	347.000	2.4	7.4	319,000	355	44.9	19.9
550	392,000	2.4	7.5	362,000	375	62.0	37.0
600	444,000	23	7.9	408,000	400 Laterback	81.1	56.1

Whittle Pit Optimisation Studies Summary March 2004

Area 223 Resource, Long Section and Plan View

Exploration Potential

Area 223 only covers a small portion of the Tunkillia gold-incalcrete anomaly, less than one square kilometre of the total twenty square kilometre anomaly. Basement drilling outside of Area 223 is generally sparse with only a limited number of targets drilled to date. Of these a number have returned intersections of potentially economic grade (>1g/t Au). Within the anomaly the north-westerly trending shear zone which hosts the Area 223 resource has only been drilled on 10 RC traverses over its remaining 7.5km length along strike from the resource. A gradient array IP survey is currently being tested to see if it can identify areas of sulphide and silica accumulation associated with mineralisation. If successful this geophysical method has the potential to rapidly identify drilling targets outside of Area 223.

In May 2004 a further 24 RC holes were drilled into the Area 223 resource. The main focusses of the program were the poorly drilled northern end of the resource and the higher grade Area 223 South Zone. These new results continued (see adjacent floure) to show improvement in the resource. In particular, drilling confirmed extensive zones of high grade mineralisation (>5g/t Au) in and around Area 223 South. The better gold intersections from the program included 15m at 7.7g/t, 5m at 15.3g/t and 3m at $16.9g/t.$

The results confirm that Area 223 South which remains open along strike to the south has significant potential to provide additional high grade resource

Tunkillia Calcrete Anomaly

Regionally Helix has a total of 3,250 sq km under tenure in the Lake Everard region, calcrete sampling has been completed over two thirds of the area but basement drilling is limited to the Tunkillia Anomaly only. Whilst not as big as the Tunkillia Anomaly there are a number high priority targets still to be explored with in the Tenement package.

Feasibility Studies

Following the appointment of John den Dryver as Study Manager for the Tunkillia feasibility study in May 2004 his team has been conducting a preliminary assessment of the mining characteristics of the Area 223 resource. The aim of this initial study is to re-optimize the resource incorporating the new drilling results and the mining methods which have been proposed. An important part of this study will be to identify areas where further drilling around the resource is likely to increase the amount of mineable gold at the current gold price.

Area 223: 111 500mN Cross Section

Tunkillia Anomaly: Resource Location and Exploration Drilling

A number of areas requiring further drilling have already been identified, in addition to the potential southern extension of the resource. This work is expected to commence in August.

Preliminary investigations into other important aspects of the feasibility study have also commenced including identification of a suitable water supply, special on-site infrastructure requirements, native title issues and development of a suitable metallurgical testing program.

GLENBUGH PROJECT

Exploration for gold at Glenburgh has identified a number of high grade zones over 10 kilometres of strike-length within a large Proterozoic shear zone. Recent drilling at the most extensively explored of these, the Apollo Prospect, produced impressive results including 6m at 20.5g/t Au during drilling to identify the down plunge extensions to the high grade mineralisation. Although the current resource at Apollo stands at only 57,000oz grading 2.9g/t, these results indicate there is potential for a resource in excess of 100,000oz.

Earlier drilling throughout the project area had identified a number of other zones of high grade gold which are now worthy of further follow-up drilling based on the new structural data obtained from the recent drilling at Apollo.

Shallow geochemical vacuum drilling in 2003 immediately east of Apollo suggests that there may also be additional unidentified gold lodes buried beneath thin alluvial cover.

Exploration at Glenburgh will continue in late 2004 to outline new high grade shoots.

Glenburgh: Prospect Location Plan

MUNNI MUNNI PROJECT

The Munni Munni intrusive complex remains the largest platinum group metals (PGM) bearing complex to be found in Australia to date. Although the slump in world palladium prices caused an early halt to the feasibility study that the Company was conducting in joint venture with Lonmin plc, analysts believe demand for PGM's worldwide will improve. Helix is well positioned in the short to medium term to develop the project when the prices, in particular that of palladium, improve.

During the resource drilling by Helix and Lonmin a number of wider high grade reef structures were identified. However these were not evaluated in detail at the time. On going reviews since cessation of the feasibility study by Helix has suggested that further work on these structures may

Munni Munni Resource: Grade x Thickness Contours

The Mt Venn project, located east of Laverton in WA, rocketed to prominence during the late 1960's nickel boom when Tasminex NL drilled a series of sulphide bearing holes on the margin of the intrusion. The intrusion is a classic layered mafic and ultramafic intrusion with extensive sulphide rich horizons. Since the early 1970's the area has been excluded from exploration and Helix will be the first company to be granted an Exploration Licence in recent times.

The intrusion has never been explored for PGMssand exploration for nickel was at best very poor. Helix's interest in the area was generated following its discovery of reef style PGM mineralisation at Jutsons Rocks just to the north. Although the mineralisation discovered was sub economic it did show the mineralising processes required for PGM's were active in layered intrusions in this region. The more prominent sulphide horizons at Mt Venn offer an attractive new exploration target in a previously unrecognised PGM region.

HELIX RESOURCES LIMITED

A.C.N. 009 138 738 Incorporated in Western Australia Level 3, 24 Kings Park Road, West Perth, Western Australia 6005 Telephone +61 8 9321 2644, Facsimile +61 8 9321 3909 Email: helix@helix.net.au, Website: helix.net.au

CONTACTS Rob Mosia Tony Martin John den Dryver

Managing Director Director-Exploration Tunkillia Study Manager

This report is based on information compiled by full time employees of Helix Resources Limited, Messrs R W Mosig and A R Martin.
competent persons as described by Listing Rule Appendix 5A. The report reflects the informati н кинолулское (Основа) 2