HELIX RESOURCES LIMITED — Capital/Financing Update 2006

May 11, 2006

$12^{\rm th}$ May 2006

SALE OF UNMARKETABLE PARCELS OF SHARES

Helix Resources Limited advises that it intends to offer for sale on the ASX, shares of unmarketable parcels held by shareholders who have not given notice that they wish to retain their shareholding and have been in receipt of the attached letter and retention form.

The attached letter and notice of retention of shares will be dispatched on Monday 15^th May 2006.

For and on behalf of the Board

Riccardo Vittino Chief Executive Officer

For further information please contact:

Riccardo Vittino Chief Executive Officer Helix Resources Limited Ph +61 8 9321 2644

Helix Resources Limited

A C N 009 138 738 Incorporated in Western Anstralia

15 May 2006

Dear Shareholder

UNMARKETABLE PARCEL SALE FACILITY

Helix Resources Limited ("Helix Resources") has a large number of shareholders on its register that hold less than A\$500 worth of shares (an "Unmarketable Parcel"). These Unmarketable Parcels represent significant registry costs for your company. In order to efficiently manage these costs Helix Resources is entitled, under clause 3 of its Constitution and Australian Stock Exchange Listing Rule 15.13, to sell the Unmarketable Parcels of those shareholders who do not respond to this letter (referred to as the "Unmarketable Parcel Sale Facility").

Our records indicate that you held an Unmarketable Parcel as at 12 May 2006. I am writing to advise you that, unless you respond to this letter, Helix Resources intends to sell your Unmarketable Parcel and deliver to you the proceeds of the sale of that Unmarketable Parcel. All costs relating to the sale of your Unmarketable Parcel, including brokerage, are payable by Helix Resources.

If you do not want your Unmarketable Parcel to be sold, you must return a 'Share Retention Notice' as instructed below.

Pursuant to clause 3 of Helix Resources' Constitution you must therefore choose ONE of the following two options:

RETAIN your Unmarketable Parcel

Complete and return the SHARE RETENTION NOTICE If you wish to retain your Unmarketable Parcel, you must complete the enclosed 'Share Retention Notice' and return it to the Helix Resources registry so that it is received by no later than 5:00pm (Perth time) on 29 June 2006. Your Unmarketable Parcel will be sold if you do not return the Share Retention Notice.

DISPOSE vour 0t Unmarketable Parcel

Do nothing If you wish Helix Resources to sell your shares on your behalf, do nothing. If Helix Resources has not received a response from you by 5pm (Perth time) on 29 June 2006, the Board of Helix Resources may resolve (pursuant to clause 3 of the Constitution) to sell your shares and appoint a stockbroker to sell your Unmarketable Parcel at a price not less than the simple average of the last sale prices of the shares of Helix Resources on ASX over the last 10 trading days prior to the date an offer is received by Helix Resources.

Please take time to read the enclosed 'Unmarketable Parcel Sale Facility - Terms and Conditions' and seek your own investment or taxation advice if needed. Any taxation consequences arising from the sale of your Unmarketable Parcel under the Unmarketable Parcel Sale Facility will be your responsibility.

Please note that the Unmarketable Parcel Sale Facility does not affect your ability to buy or sell Hellx Resources shares on ASX (subject only to the 'Terms and Conditions of the Unmarketable Parcel Sale Facility').

If you have any questions regarding the operation of the Unmarketable Parcel Sale Facility, please call the Company Secretary on +61 8 9321 2644.

On behalf of the Board, I encourage you to consider the opportunity provided under the Unmarketable Parcel Sale Facility.

Yours sincerely

Riccardo Vittino Chief Executive Officer

P.O. Box 825, West Perth, Western Australia 6872 9 Richardson Street, West Perth, Western Australia 6005 Telephone +61 8 9321 2644, Facsimile +61 8 9321 3909, Email: helix@helix.net.au, Website: helix.net.au

Unmarketable Parcel Sale Facility - Terms and Conditions

These terms and conditions and the accompanying Share Retention Notice set out the terms and conditions of the Unmarketable Parcel Sale Facility.

1. WHAT IS THE UNMARKETABLE PARCEL SALE FACILITY?

The Unmarketable Parcel Sale Facility allows Helix Resources to sell shares on behalf of shareholders who hold less than a marketable parcel (that is, less than A\$500 worth of Helix Resources ordinary shares) on a particular date. An unmarketable parcel sale facility is often implemented by listed companies in response to the disproportionately high registry and administrative costs incurred by those companies from maintaining unmarketable parcels on their shareholder registers.

2. DOES HELIX RESOURCES HAVE THE RIGHT TO SELL MY HELIX RESOURCES SHARES?

Yes. Helix Resources is entitled, under clause 3 of its Constitution and Australian Stock Exchange Listing Rule 15.13, to sell the Unmarketable Parcels unless those shareholders notify Helix Resources in writing that they wish to retain their shares. Proceeds from the sale must be remitted to those shareholders whose Unmarketable Parcels have been sold.

3. WHAT IF I DON'T WANT MY HELIX RESOURCES SHARES TO BE SOLD?

If you wish to retain your Helix Resources shares, you MUST complete the Share Retention Notice and return it so that it is received by Helix Resources' registry: -Advanced Share Registry Services

PO Box 1156 Nedlands WA 6009

no later than 5:00pm (Perth time) on date 2006. If you do so, your shares will not be sold.

4. WHAT ARE THE COSTS OF HAVING MY HELIX RESOURCES SHARES SOLD ON MY BEHALF?

There are no brokerage or other transaction costs payable by shareholders whose Unmarketable Parcels are sold under the Unmarketable Parcel Sale Facility. These costs will be paid by Helix Resources. Taxation consequences arising from the sale of your shares under the Unmarketable Parcel Sale Facility will be your responsibility.

5. WHEN WILL MY HELIX RESOURCES SHARES BE SOLD?

Sales of shares will occur on ASX and are expected to occur over a ten to twenty trading day period after 7 July 2006 ("Sale Period").

6. WHAT PRICE WILL I RECEIVE FOR SHARES SOLD UNDER THE UNMARKETABLE PARCEL SALE FACILITY?

For each share sold, you will receive an amount equal to the total proceeds from all shares sold under the Unmarketable Parcel Sale Facility, divided by the total number of shares sold under the Unmarketable Parcel Sale Facility.

7. WHEN WILL THE PROCEEDS FROM THE SALE OF SHARES BE SENT TO ME?

As soon as practicable after the Sale Period, Helix Resources will mail a cheque for your proceeds.

8. WHERE CAN I OBTAIN FURTHER INFORMATION IN RELATION TO THE UNMARKETABLE PARCEL SALE FACILITY?

If you have any questions about the Unmarketable Parcel Sale Facility, please call Helix Resources' Company Secretary on +61 8 9321 2644.

None of Helix Resources or Advanced Share Registry Services, or any of their respective officers, employees or agents, is or is to be taken to be, giving any securities recommendation or investment advice in relation to the Unmarketable Parcel Sale Facility, nor do any of them have any obligation to do so. You should consider seeking your own independent advice in relation to the Unmarketable Parcel Sale Facility.

For further information contact:

Riccardo Vittino Chief Executive Officer Phone +61 8 9321 2644

Helix Resources Limited

A.C.N. 009 138 738 Incorporated in Western Australia

SHARE RETENTION NOTICE

You are required to complete and return this Share Retention Notice ("Notice") to Helix Resources Limited's registry by 5pm (Perth time) on 29 June 2006 if you wish to retain your Helix Resources Limited shares - notwithstanding that they do not currently represent a marketable parcel as at the date of this Notice.

In accordance with clause 3 of the Constitution of Helix Resources Limited. I give notice that I wish to retain my shareholding in Helix Resources Limited.

Signature of Shareholder(s)

Individual or First Shareholder Sole Director or Sole Company Secretary

Shareholder 2 Director/Company Secretary Director

Shareholder 3

Date: ....................................

NOTES

1. Number of Shares

This Notice only applies to the account identified by the SRN / HIN given above.

2. Signature requirements

Each shareholder must sign this form. If shares are held in joint names, all shareholders must sign. If signing as an Attorney, then the Power of Attorney must have been noted by the Company's share registry to be duly executed and accompany this form. Only duly authorised officers may sign on behalf of a company, stating the office held by the signatories.

3. Address for return of Share Retention Notice

Helix Resources Limited CI- Advanced Share Registry Services PO Box 1156 Nedlands WA 6009