METALS AUSTRALIA LTD — Capital/Financing Update 2005

Mar 2, 2005

AUSTRALIAN UNITED GOLD LTD ACN 008 982 474

1st Floor, 8 Parliament Place West Perth WA 6005 PO Box 1618 West Perth WA 6872 Tel: (08) 9481-7833 Fax: (08) 9481-7835 Email: aul@austunitedaold.com Website: www.austunitedgold.com

3rd March 2005

Australian Stock Exchange Companies Announcement Office 20 Bond Street SYDNEY NSW 2000

Dear Sirs.

Re: Sherlock Bay Extended Nickel-Copper Project

The Directors are pleased to advise that the formal Acquisition and Farm-in Agreement with Fox Resources Ltd was executed on 24^th February 2005.

Under the terms of the Agreement the Company may earn up to 70% of the Sherlock Bay Extended Project.

The Company has the right to purchase 50% for the sum of \$250,000 and the right to earn a further 20% by expending \$500,000 over the next 3 years. Fox Resources Ltd will retain a 1% net smelter royalty.

The Sherlock Bay Extended Project is located in the Eastern Pilbara Region, 1250 km north of Perth, and 75 km to the east of Karratha. The project is composed of three exploration licence applications (ELA 47/ 1226, 1227 & 1251), which cover over 470 km2 and is in close proximity to logistical infrastructure including sealed roads and port facilities; the tenement areas surround Sherlock Bay Nickel's 'Sherlock Bay' resource area

Work to date, conducted by Australian United Gold, has included:

• 1. Acquisition & Compilation of the Historical WAMEX Data.
• 1. Acquisition & Reprocessing of the Poseidon Aeromagnetic Data.
• 1. Compilation of Regional Fact & Interpretive Geology.
• 1. Acquisition of Electromagnetic & LandSat data (ongoing).

This work has identified a number of prospect areas that were generated by previous explorers and several new prospects which have been generated by the Company. Prospects include George Sherlock, Triple, Dumbalena, Quartz bore & Sherlock Bay North. The compilation of the historical data is currently being finalised, after which it will be fully evaluated. The field phase of exploration will commence when the exploration licences are officially approved.

Yours faithfully

D N ZUKERMAN Director