LIBERTY METALS LTD — Capital/Financing Update 2006

Oct 24, 2006

Traka Resources Limited

ABN: 63 103 323 173

25 October 2006

The Manager Announcements Company Announcements Office Australian Stock Exchange Limited PO Box H224 Australia Square SYDNEY NSW 2000

Dear Sir / Madam,

Entitlement Issue - Letter to Shareholders

We attach a copy of a letter sent to shareholders today advising them of the details of the Company's prorata enfittement issue announced on 24 October 2006.

Yours faithfully

Peter Ruttledge Company Secretary

Traka Resources Limited

ARN: 63 103 323 173

25 October 2006

Dear Shareholder

NOTICE OF NON-RENOUNCEABLE PRO-RATA ISSUE OF SHARES

The board of Traka Resources Limited vesterday announced a pro-rata non-renounceable 1 for 3 issue of ordinary fully paid shares (the "New Issue").

The Prospectus for the New Issue was lodged with the Australian Securities and Investments Commission (ASIC) on 24 October 2006 and will be sent to all shareholders together with shareholder Entitlement and Acceptance and Shortfall Application forms by 8 November 2006.

The Company will apply the funds raised to continue funding exploration programs, evaluate new projects and meet administration expenses.

The New Issue is non-renounceable which means that there will be no rights trading.

Details of the New Issue are as follows:

• Pro-rata non-renounceable issue of ordinary fully paid shares Type of Issue on a 1 for 3 basis Amount pavable 18 cents per share entitlement No. of shares to be issued Up to 11,195,550 Amount to be raised Up to \$2,015,200 The purpose of the issue is to fund further exploration on the Purpose of this Issue Company's projects as well as to provide for the evaluation and acquisition of new projects and ongoing administration expenditure.
• The offer is not underwritten Underwriting
• Shareholders will be able to apply for additional shares arising Shortfall applications from any shortfall in acceptances
• Listing
• Important dates
• 24 October 2006
• 3 November 2006
• 8 November 2006
• 5 December 2006
• 12 December 2006

Yours faithfully

N Tomkinson Chairman

Prospectus lodged with ASIC and ASX

Australian Stock Exchange (ASX)

• Record date for Entitlements
• Prospectus, Entitlement and Acceptance Form, and Shortfall L Application Form sent to entitled shareholders

Application for listing of the New Shares has been made to the

• OFFER CLOSES: Closing date for receipt of Acceptances
• Allotment of shares and despatch of holding statements $\ddot{ }$