Lachlan Star Limited — M&A Activity 2004

Oct 10, 2004

ABN 88 000 759 535

Gympie Gold Limited (Receivers and Managers Appointed) (In Liquidation)

ASX and AIM Announcement

11^th October 2004

YANZHOU ACQUIRES SOUTHLAND COAL

Australian exploration, mining and marketing company Gympie Gold Limited ("Gympie Gold") today announced the execution of contracts for the sale of the group's interest in the mining leases and assets comprising the Southland Coal operations in the Hunter Valley, following a world wide sales campaign undertaken by the company's receivers.

The Purchaser is Yanzhou Coal Mining Company Limited ("Yanzhou") of China.

Yanzhou will be separately announcing the transaction in accordance with the requirement of the jurisdictions where it is listed

The sale is expected to take six to eight weeks to complete, following satisfaction of a number of commercial conditions precedent, including the transfer of mining tenements and the environmental authorities by government.

For further information:

Andrew Love, Receiver and Manager

Southland Coal Pty Limited (Receivers and Managers Appointed) (In Liquidation)

C/- Ferrier Hodgson Chartered Accountants

Telephone: 9286 9999