INOVIQ LTD — Capital/Financing Update 2005

Mar 29, 2005

ASX Release

30 March 2005

ASX & AIM Symbol "EUG"

Sofia Gold-Silver Deposit Romania

As part of Eurogold's ongoing programme of reviewing historical mining data held by Transgold SA (Eurogold 50%) together with results from recently completed exploration work, Eurogold has identified the historically mined Sofia deposit as a priority exploration target for 2005.

HIGHLIGHTS

• Substantial historical production (estimated to be 3.5 million tonnes $(20, 5, 9/t)$ ) $\bullet$
• Situated 5 km from the Transgold plant
• In excess of 10km of underground workings
• Underground mapping has revealed >75 gold silver epithermal veins
• The veins have strike lengths of between 100m and 1,200m and widths of between 0.1m and 10m
• Footprint of approximately 900m x 1000m
• Underground sampling produced grades of up to 12 g/t
• 1,400m drilling programme planned for 2005

Introduction

The Sofia gold deposit is held under exploration licence title by Transgold SA and is situated approximately 5 km from Transgold's CIL gold plant. Sofia has supported significant underground production historically and it is now an exploration/evaluation target for the company as a potential source of high tonnage open pit feed for the Baia Mare plant. During the forthcoming field season a programme of exploration drilling is planned to assess this potential.

History

Accurate historical gold production in Romania is difficult to determine because of the secrecy surrounding the industry. Production from Sofia began in the 1930's and peaked during the communist era; it continued on a small scale until 2000. Anecdotal evidence suggests that 3.5 million tonnes of ore was mined at an average gold grade of 5 g/t. In excess of 10 km of underground development has been completed on two levels, accessed from adits.

It is interesting to note that the Meda tailings dump which has now been retreated by Transgold included a significant (10-15%) contribution of Sofia flotation tailings. The overall dump grade was 1.4 g/t gold.

Geoloav

The deposit lies within the Romanian portion of the Carpathian Mountains. This is a well known metallogenic province for precious and base metals which formed in response to subduction at the East European plate margin some 10 to 15 million years ago.

Sofia lies within a calc-alkaline volcanic massif related to island arc style volcanicity. A major east-west oriented trans-crustal fault, the Dragos-Voda fracture, lies just to the south. This structure is thought to have focused plutonism and hydrothermal activity.

The deposit forms a conspicuous topographic high rising to 542m above sea level and flanked by steeply incised stream valleys.

Mineralisation at Sofia is hosted by a swarm of quartz veins within andesitic country rocks which are locally brecciated. Underground mapping has revealed over 75 individual gold-silver bearing epithermal veins. The veins are steeply dipping and exhibit a range of 100-1,200m in strike length and 0.1-10 m in width. They occupy a footprint area measuring approximately 900m by $1,000m$ .

Within the veins the mineralisation consists of auriferous pyrite and free gold with traces of various base metal sulphides. Sulphides are less abundant close to surface due to supergene oxidation. Individual veins are reported to have gold grades in the range 10-80 g/t with corresponding silver grades of 20-920 g/t. Veins and adjacent wallrock are characterised by hydrothermal silicification and potassic alteration.

Recent Work

Field work has been undertaken at the Sofia workings since 1999. Old workings on the 394m and 359m levels have been reopened and channel sampled. Surface trenching and sampling was carried out over a number of veins. Observations show that only a few veins have been mined and the mining is of unknown extent. Certainly there has been no previous surface mining or expression of underground mining to surface.

Underground sampling revealed un-mined veins of up to 1m width with gold grades of up to 12 g/t. Surface sampling showed persistent mineralised structures with a highest gold value of 3.7 g/t over a width of 6.5 m.

Drilling Programme 2005

A drilling programme of 1,400m using both diamond coring and reverse circulation methods has been planned for the coming field season. The estimated cost of this work is US\$ 1.4 million. The aim of the programme is to evaluate the open pit potential of the deposit.

PETER GUNZBURG Executive Chairman Eurogold Limited