ILUKA RESOURCES LIMITED — Capital/Financing Update 2005

May 3, 2005

Brisbane Head Office

Suite 1, Level 6 10 Market Street Brisbane Qld 4000 PO Box 15164 City East Qld 4002 TEL: (07) 3229 4951 FAX: (07) 3211 8765 www.bemax.com.au

Broken Hill

16-18 Kanandah Drive Broken Hill NSW 2880 PO Box 444 Broken Hill NSW 2880 TEL: (08) 8088 6538 FAX: (08) 8087 0114

Bunbury

Koombana Drive North Shore Bunbury WA 6230 PO Box 133 Bunbury WA 6231 TEL: (08) 9721 0200 FAX: (08) 9791 1249

Mildura

4463 Benetook Ave Mildura VIC 3501 PO Box 4032 Mildura VIC 3052 TEL: (03) 5025 7575 FAX: (03) 5025 7105

Perth

Level 15, QV.1 Building 250 St George's Terrace Perth WA 6000 TEL: (08) 9212 6000 FAX: (08) 9486 4711

3 May 2005

The Announcements Officer Australian Stock Exchange 20 Bridge Street SYDNEY NSW 2000

Dear Sir

Please find attached an announcement in respect of the purchase by Bemax Resources NL ("Bemax"), from Iluka Resources Limited, of exploration area to significantly increase the size of Bemax's Snapper Deposit, which already has a measured resource of 5.4 million tonnes of contained Heavy Mineral.

The development of the Snapper Deposit will benefit from the infrastructure presently under construction for the Ginkgo Mine, located just 15km from the Snapper Deposit. In addition, the Mineral Separation Plant currently under construction in Broken Hill has been designed to process Heavy Mineral from both the Ginkgo Mine and the Snapper Deposit when the latter is brought on stream in 2008.

The Ginkgo Mine is on target for commissioning at the end of this year.

Yours faithfully

Lynette Jones Company Secretary

www.bemax.com.au

Email: liones@bemax.com.au

Phone: 1800 732 290 or (61 - 7) 3229 4951 Facsimile: (61-7) 3211 8765

3 May 2005

Sale of NSW Exploration Licence

Iluka Resources Limited and Bemax Resources NL today announced that they have reached an agreement on the future development of the Snapper mineral sands deposit, located in the NSW sector of the Murray Basin.

Under the terms of the sale agreement, Bemax will make a quaranteed net deferred payment of A\$3.9 million to acquire Iluka's interest in the northern section of Exploration Licence EL 6024, which contains an extension to the Snapper Deposit.

The implementation of the sale agreement remains subject to securing the necessary approvals from the NSW Government.

Contact - Bemax

Lynette Jones (07) 3229 4951

Brisbane Head Office Suite 1. Level 6 10 Market Street Brisbane Old 4000 PO Box 15164 City East Old 4002

TEL: (07) 3229 4951 FAX: (07) 3211 8765 www.bemax.com.au

INCORPORATING