ILUKA RESOURCES LIMITED — Interim / Quarterly Report 2004

Apr 14, 2004

Notice to the Australian Stock Exchange

15 April 2004

MARCH OUARTER 2004 PRODUCTION REPORT

Iluka Group production and sales for the quarter ended March 31 2004 and the corresponding period in 2003 are summarised in the following table.

Product (tonnes)	Quarter 1 2004	Quarter 1 2003
Rutile
production	33,763	38,961
sales	25,321	27,174
Syn Rutile
production	109,988	118,524
sales	73,730	104,952
Ilmenite
Production $^{-1}$	328,842	348,747
sales	150,945	123,282
Zircon
production	105,643	88,755
sales	82,556	69,511
Leucoxene/Hyti
production -2	5,043	3,326
$\overline{\mathsf{sales}}^3$	14.698	14.570
Coal
production	230,926	289,350
sales	236,523	274,158

Notes

1 Includes Ilmenite used to manufacture synthetic rutile

2 Hyti 91 only

$\overline{3}$ Sales include Leucoxene, Hy ti 91 and Hyti 70

Group production and sales numbers include 50% of Narama Coal and 100% of $\boldsymbol{A}$ Consolidated Rutile Limited's production and sales

Overview of Group Production and Sales

• Group production of zircon and leucoxene/hyti increased in the first quarter of 2004 compared with the corresponding period in 2003. The main factor influencing higher zircon production in the quarter was the improved production performance of the USA operations compared with their performance in the first quarter of 2003. Group production of ilmenite, SR, rutile and coal were all lower, primarily as a result of production constraints at the Western Australia and NSW operations.
• Group sales of ilmenite, zircon and leucoxene/hyti increased in the first quarter of 2004 $\bullet$ compared with the corresponding period in 2003. Conversely sales of synthetic rutile, rutile and coal decreased compared with the same period in 2003, primarily as a result of the timing of shipments and product availability.

		Production for the quarter and corresponding 2003 quarter from each of Iluka's
		key regional operations are summarised in the following table.

Product (tonnes) & Location	Quarter 1 2004	Quarter 1 2003
Rutile
WA	15,201	20,423
USA	4,233	4,404
Syn Rutile
WA	109,988	118,524
Ilmenit $e^{-1}$
$WA^{-2}$	225,285	266,016
USA	71,081	53,315
Zircon
WA	73,369	66,355
USA	22,263	12,633
Hyti 91
WA	5,043	3,326
Coal
$NSW-3$	230.926	289,350

Notes

Ilmenite includes Hyti 70 in WA and Leucoxene in the USA 1.

NSW refers to Iluka's 50% interest in the Narama Coal Joint Venture $\overline{2}$

WA Ilmenite production includes ilmenite used to manufacture SR २

Consolidated Rutile Limited production (100%) for the quarter and corresponding 2003 quarter is summarised in the following table (for more details see CRL's quarterly production report dated 14 April 2004).

หลักเกมีเสียงเลี้ยกกากเกมกากเกมกากเกมกากเกมกากเกมกากเล่าเนิน Product (tonnes) Quarter 1 2004 Quarter 1 2
Rutile
Ilmenite
Zircon

Review of Regional Performance in the Quarter

WA

Lower ilmenite production levels reflect difficult mining conditions in the south-west (final stages of mining at Yoganup prior to moving to Yoganup West) and electricity supply interruptions at Eneabba. Rutile production was lower mainly as a result of declining grades in the mid-west. In the case of SR, production was impacted by a 4 week shutdown in January of the SR2 kiln at north-Capel and a 2 week shutdown in March of the SR3 kiln at Narnoulu.

USA

Higher ilmenite and zircon production levels reflect the improved performances of the Old Hickory operations in Virginia and MC1 (post planned outage to complete an upgrade) in Florida as well as an initial contribution from Lulaton operations in Georgia during the commissioning phase.

Old

Production during the quarter was impacted by periods of lower throughput at the Ibis mine due to a low mine face height and indurated layers. However, the successful integration of supplementary dry mining operations with both dredging operations enabled CRL to maintain rutile and zircon production levels in line with Q1 in 2003.

NSW

Coal production was lower due to mining difficulties caused by wet weather during the quarter. Sales were also lower in response to production constraints.

	Quarter 1 2004	Quarter 1 2003
Sales Revenue
WА	118.3	11R J
USA	19.9
	17.0
NSW
Total (A\$m)	162.9	160.5
Capex (A\$m)	36.8
Exploration (A\$m)

Iluka's sales revenue, capital and exploration expenditure for the quarter and corresponding 2003 quarter is summarised in the following table.

Notec

All revenues shown include any hedging gains and are based on 50% of Narama Coal and 100% of Consolidated Rutile Limited's revenues. Exploration is shown as cash expenditure. All financials remain subject to audit confirmation.

Exploration Results and Highlights

• Two air core drill rigs (one company owned and one on contract) focused on $\bullet$ development drilling at the Douglas project and exploration on other targets in the south west region of Victoria.
• Drilling in Western Australia continued to focus on and about operational sites. $\bullet$
• A company owned air core drill rig was used to complete the initial reconnaissance $\bullet$ program over the Farafangana prospect on the east coast of Madagascar. The rig has returned to Australia and is working in Western Australia.
• Work in the USA concentrated on and around the mine sites in Florida and Virginia. A $\bullet$ second company owned air core drill rig has been sent to the USA and will be mounted on an all terrain vehicle to increase drilling resources available to the USA operations.
• Drilling Activity Perth Basin 16,675 metres, Murray Basin 27,647 metres, USA 6,441 $\bullet$ metres.
• Tenement Relinguishments EL4323, EL4764, EL4787 Murray Basin, Victoria and $\bullet$ EL70/604 - Perth Basin, Western Australia.
• Tenement Applications ELA4793, ELA 4787 Murray Basin, Victoria, ELA 2280 Murray $\bullet$ Basin, NSW, ELA84/04 - Eucla Basin, South Australia, MLA 70/1167 and WARLA 70/38 -Perth Basin, Western Australia.

Mike Folwell Managing Director and CEO