ILUKA RESOURCES LIMITED — Interim / Quarterly Report 2005

Jan 19, 2005

Notice to the Australian Stock Exchange

20 January 2005

CORRECTION TO THE DECEMBER QUARTER 2004 PRODUCTION REPORT

Iluka Resources Limited wishes to advise that the zircon production volumes published in the December 2004 quarter production report (released earlier today) are overstated by 25,651 tonnes in respect to the following sections of the report:

• December quarter 2004 Group zircon production;
• December quarter of 2004 Western Australian zircon production;
• 2004 full year Group zircon production; and
• 2004 full year Western Australian zircon production

The correct zircon production volumes are shown below. The balance of the December quarter production report is unchanged from the version published earlier today. A re-stated version of the December quarter production report is also attached.

Group zircon Production (tonnes)	Quarter 4 2004	Full year 2004
production	107.296	428.460
WA zircon Production (tonnes)	Quarter 4 2004	Full year 2004
production	67.404	283.288

Iluka apologises for any inconvenience that may have been caused.

David Grant Chief Financial Officer

Notice to the Australian Stock Exchange

20 January 2005

RESTATED DECEMBER QUARTER 2004 PRODUCTION REPORT

Iluka Group production and sales for the quarter ended December 31 2004 and full year are summarised in the following table.

Product	Quarter 4	Ouanter 4	Full year	Fullyear
(tonnes)	2004	2003	201049	2008
Rutile
production	41,640	33,488	149,279	141,641
sales	50,257	40,290	150,914	167,324
Syn Rutile
production	146,726	119,055	495,873	471,776
sales	140,045	148,952	480,598	466,722
Ilmenite
production 1	412,695	386,817	1,450,431	1,450,552
sales	215,543	244,730	740,833	740,423
Zircon
production	107,296	101,156	428,460	405,685
sales	112,118	151,102	423,550	409,266
Leucoxene/Hyti
production 2	3,724	3,137	12,271	13,702
sales $3$	25,345	15,966	62,927	50,711
Coal
production	253,429	259,484	1,046,144	1,036,775
sales	261,569	249,544	1,055,066	1,030,000

Notes

1 Includes ilmenite used to manufacture synthetic rutile.

Hvti 91 only. $\overline{z}$

Sales include Leucoxene, Hyti 91 and Hyti 70. $\mathbf{R}$

Group production and sales numbers include 50% of Narama Coal and 100% of Consolidated Rutile Limited's $\blacktriangleleft$ production and sales.

Overview of Group Production and Sales

• Group production of rutile, synthetic rutile, ilmenite, zircon and leucoxene/hyti increased $\bullet$ in the quarter compared with the corresponding period in 2003. Group production of coal was slightly lower. The main factors positively influencing production during the period were the improved performance of both the USA and CRL operations and synthetic rutile kiln utilisation and throughput levels in Western Australia.
• Group sales of rutile and leucoxene/hyti and coal were higher in the quarter compared $\bullet$ with the corresponding period in 2003. In the case of rutile and leucoxene/hyti, this was mainly due to the timing of shipments, where as coal sales were higher in response to the customer's requirements. Conversely synthetic rutile, zircon and ilmenite sales were slightly lower in response to a more evenly spread second-half sales schedule in 2004 compared with the 2003 sales schedule which was heavily weighted towards the last quarter.

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

Product (tonnes) & Location	Quarter 4 2004)	Quarter 4 2003	Full year 2002	Full year 2003)
Rutile
WA	18,784	16,438	66,507	69,713
USA	7,254	5,872	22,916	25,698
Syn Rutile
WA	146,726	119,055	495,873	471,776
$I$ imenite $1$
WA	293,736	274,945	999,469	1,051,222
USA	88,967	81,652	326,186	276,129
Zircon
WA	67,404	69,922	283,288	301,130
USA	28,388	23,840	101,880	74,122
Hyti 91
WA	3,724	3,137	12,271	13,702
Coal
NSW	253,429	259,484	1,046,144	1,036,775

Notes

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

NSW refers to Iluka's 50% interest in the Narama Coal Joint Venture. $\mathcal{P}$

3 WA Ilmenite production includes ilmenite used to manufacture SR.

CRL's production (100%) for the quarter and full year is summarised in the following table (see CRL's quarterly production report dated 18/1/2005).

Product (tonnes)	Montena といいとき	Quarter 4 911 I E I	Fulltyear PANTER !	i Millimet T 医耳状肌
Rutile	15.602	11.178	59.856	46.230
Ilmenite	29.992	30.220	124.776	123.201
Zircon	.504	' 394		30.433

Review of Regional Performance in the Quarter

WA

WA production levels were higher for all products apart from zircon compared with the previous corresponding quarter in 2003. Higher production levels were mainly due to dry mining and processing performance improvements at both WA operations and higher synthetic rutile kiln utilisation and throughput levels at the north-Capel operations.

USA

USA production levels were higher for all products compared with the previous corresponding quarter in 2003. This was mainly due to the ongoing high-performance of the Virginia operations together with increasing contributions from the Lulaton operation (Georgia), post-commissioning and the Florida mining operations, post-completion of an upgrade in O1, 2004.

Old

• Production of rutile and zircon was higher compared with the previous corresponding quarter in 2003. This was mainly due to additional production from supplementary dry mining activities which more than offset the one month shutdown of the Yarraman dredge for repairs following a sand slump incident.

NSW

Coal production in the quarter was lower and sales slightly higher compared with the previous corresponding quarter in 2003. On a full year basis, both production and sales are slightly higher than the contractual requirement.

	Quarter 4 ស្រុកអូ	Quarter 4 2008	Full yean 2002	Full year 医血管
Sales Revenue
WA	142.6	176.4	574.4	584.1
USA	40.1	30.7	130.1	106.4
Qld	24.4	18.4	80.9	62 Z
NSW	8.8	8.3	34.3	33.1
Total (A\$m)	215.9	233.8	819.7	785.8
Capex (A\$m)	72.0		212.8	157.3
Exploration (A\$m)	4.3	3.9	14.0	13.

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

Notes

All revenues shown include any hedging gains and are based on 50% of Narama Coal and 100% of $\uparrow$ Consolidated Rutile Limited's revenues.

Exploration is shown as cash expenditure. $\overline{z}$

$\mathbf{R}$ All financials remain subject to audit confirmation.

Exploration Results and Highlights

• Drilling in the Murray Basin continued to test for extensions and edge definition at the Douglas Mine. Resource drilling at the Earl deposit delineated a north-west extension to this strandline and ground water studies confirmed that Castaway and the north-west section of the Kerribee deposit to be dry mining targets. Resource definition studies are continuing at the Euston and Ouyen deposits.
• Drilling for resource extensions at Eneabba intersected zircon enriched zones near current $\bullet$ operating mines at Adamsons and Eneabba West.
• Work on the Atlantic coastal plain in the USA continued to test resource extensions at Old Hickory, Lulaton and Green Cove Springs. The Minerals Division of the United States Geological Survey executed a Cooperative Research and Development Agreement with Iluka to explore for titanium and zircon mineralisation in the USA.
• Successful exploration highlighted the zircon and rutile potential of the Eucla Basin, straddling both South and Western Australia where Iluka made two zircon-rich discoveries (Jacinth and Ambrosia) in Exploration Licence 2900. As a consequence the Company has applied for a large number of additional tenements in the Eucla Basin covering an area of more than 50,000 square kilometres.
• Drilling Activity
• Perth Basin $-26,592$ metres $\circ$
• Murray Basin 20,505 metres $\circ$
• Eucla Basin $-13,322$ metres $\circ$
• $USA 4,536$ metres $\circ$
• Tenement Relinguishments
• NSW ELA 2280BH $\circ$

• WA-E70/1742, E70/2434 and ELA 70/2368 $\sim$

• Tenement applications $\bullet$

• O Eucla Basin SA ELAs 727/04, 746/04, 747/04, 748/04, 749/04, 750/04, 751/04, 752/04, 753/04, 754/04, 755/04, 756/04, 757/04, 758/04, 759/04, 760/04, 761/04, 762/04, 763/04, 764/04, 765/04, 766/04, 767/04, 768/04, 769/04 and 770/04.
• Eucla Basin WA ELAs 69/1973, 69/1974, 69/1975, 69/1976, 69/1977, 69/1978, $\circ$ 69/1979, 69/1980, 69/1981, 69/1982, 69/1983, 69/1984, 69/1985, 69/1986, 69/1987, 69/1988, 69/1989, 69/1990, 69/1991, 69/1992, 69/1993, 69/1994, 69/1995, 69/1996, 69/1997, 69/1998, 69/1999, 69/2000, 69/2001, 69/2002, 69/2003, 69/2004, 69/2005, 69/2006, 69/2007, 69/2008, 69/2009, 38/1751, 826/04, 69/2028 and 69/2029.

Mike Folwell Managing Director and CEO