METALS AUSTRALIA LTD — Capital/Financing Update 2007

Jan 23, 2007

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement. application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX's property and may be made public.

Introduced 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003, 24/10/2005.

Name of entity

METALS AUSTRALIA LIMITED

ABN

38 008 982 474

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

⁺Class of ⁺securities issued or to be $\mathbf{1}$ issued

Options

• $\overline{2}$ Number of ⁺securities issued or to be issued (if known) or maximum number which may be issued
• 3 Principal terms of the +securities (eg, if options, exercise price and expiry date; if partly paid *securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

103,150,000

Exercise price: 5 cents per option Expiry date: 30 September 2009

$\overline{\text{+ See chapter 19}}$ for defined terms.

• $\overline{4}$ Do the *securities rank equally in all respects from the date of allotment No with an existing ⁺class of quoted *securities? If the additional securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration (1)100,000,000: 4 cents each (2) 3,150,000 staff and consultants: free Purpose of the issue 6 (1) Issued in part payment of an (If issued as consideration for the underwriting fee as approved in General acquisition of assets, clearly identify Meeting those assets) (2) Staff incentive $\overline{7}$ Dates of entering ⁺securities into uncertificated holdings or despatch 24 January 2007 of certificates Number ⁺Class 8 Number and ⁺class of all *securities quoted on ASX Fully Paid Ordinary 669,608,765 (including the securities in clause) 2 if applicable) 103,150,000 Options expiring 30 September 2009 at an exercise price of 5 cents each Number ⁺Class 9 Number and ⁺class of all *securities not quoted on ASX (including the securities in clause) 2 if applicable)
• $\overline{10}$ Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)

Dividend policy not yet implemented

Part 2 - Bonus issue or pro rata issue

⁺ See chapter 19 for defined terms.

11	holder security approval Is. required?
12	Is the issue renounceable or non- renounceable?
13	Ratio in which the + securities will be offered
14	+ Class of + securities to which the offer relates
15	+Record date determine to. entitlements
16	Will holdings on different registers (or subregisters) be aggregated for calculating entitlements?
17.	Policy for deciding entitlements in relation to fractions
18	Names of countries in which the entity has *security holders who will not be sent new issue documents
	Note: Security holders must be told how their entitiements are to be dealt with.
	Cross reference: rule 7.7.
19	Closing date for receipt of acceptances or renunciations
20	Names of any underwriters
21	Amount of any underwriting fee or commission
22	Names of any brokers to the issue
23	Fee or commission payable to the broker to the issue
24	Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of *security holders
25.	If the issue - is contingent on 'security holders' approval, the date of the meeting

$\overline{\text{ }*$ See chapter 19 for defined terms.

26	Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled
27	If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders
28	Date rights trading will begin (if applicable)
29.	Date rights trading will end (if applicable)
30	How do *security holders sell their entitlements in full through a broker?
31	How do + security holders sell part of their entitlements through a broker and accept for the balance?
32	How do + security holders dispose of their entitlements (except by sale through a broker)?
33	+Despatch date

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of securities (tick one)
• Securities described in Part 1 $(a)$ ञि

$(b)$

All other securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or

⁺ See chapter 19 for defined terms.

documents
35	⊠	If the "securities are "equity securities, the names of the 20 largest holders of the additional + securities, and the number and percentage of additional + securities held by those holders
36	ΙXΙ	If the "securities are "equity securities, a distribution schedule of the additional *securities setting out the number of holders in the categories $1 - 1,000$ $1,001 - 5,000$ 5,001 - 10,000 $10,001 - 100,000$ 100,001 and over
37		A copy of any trust deed for the additional +securities
		Entities that have ticked box 34(b)
38		Number of securities for which + quotation is sought
39		Class of + securities for which quotation is sought
40	*securities?	Do the + securities rank equally in all respects from the date of allotment with an existing + class of quoted
		If the additional securities do not
	٠	rank equally, please state: the date from which they do
	the ٠	to which they extent participate for the next dividend,
	(in	of the case trust, a distribution) or interest payment
		the extent to which they do not rank equally, other than in
		relation to the next dividend, distribution or interest payment
41	now	Reason for request for quotation
		Example: In the case of restricted securities, end of restriction period
	other security)	on conversion of another security, clearly identify that
			Number	+ Class
42		Number and + class of all + securities quoted on ASX (including the securities in clause 38)

$\overline{\text{ }*$ See chapter 19 for defined terms.

Ouotation agreement

• $\mathbf{I}$ *Quotation of our additional *securities is in ASX's absolute discretion. ASX may quote the *securities on any conditions it decides.
• $\overline{2}$ We warrant the following to ASX.
• The issue of the *securities to be quoted complies with the law and is not for $\bullet$ an illegal purpose.
• There is no reason why those "securities should not be granted "quotation.
• An offer of the "securities for sale within 12 months after their issue will not require disclosure under section $707(3)$ or section $1012C(6)$ of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any $\bullet$ applications received by us in relation to any *securities to be quoted and that no-one has any right to return any *securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the *securities be quoted.
• If we are a trust, we warrant that no person has the right to return the *securities to be quoted under section 1019B of the Corporations Act at the time that we request that the "securities be quoted.
• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.
• $\overline{4}$ We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before *quotation of the 'securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here: Lodged electronically Date: 24 January 2007 David Zukerman Director

name origin ansat mang arrow

⁺ See chapter 19 for defined terms.

METALS AUSTRALIA LTD

Item 35 - Top Twenty Holders of Additional Securities

Name	Number Held	Percentage of Additional Securities
LC (Asia) Limited	50.000,000	48.47
Eevo Pty Ltd	26,450,000	25.64
Queensway Investments Pty Ltd	16,375,000	15.87
Mandevilla Pty Ltd	2,500,000	2.42
Fidelity & Security Nominees Pty Ltd	1.500.000	1.45
RM Capital Pty Ltd	1,000,000	0.97
Mr Allan George Bassett	500,000	0.48
Tisan Industries Pty Ltd	500.000	0.48
Ms Gillian Arkwright	450,000	0.44
Mrs Penelope Anne McGuckin	250,000	0.24
Mr Timothy Putt	250,000	0.24
Tisan Superannuation Fund	250,000	0.24
Caconda Pty Ltd as Trustee for Kalgoorlie Mine
Management Pty Ltd Superannuation Fund	250.000	0.24
Kalgoorlie Mine Management Pty Ltd as Trustee
for Kalgoorlie Mine Management Pty Ltd
Superannuation Fund	250,000	0.24
Jadel Pty Ltd as Trustee for Kalgoorlie Mine
Management Pty Ltd Superannuation Fund	250,000	0.24
Coniston Pty Ltd as Trustee for Kalgoorlie Mine
Management Pty Ltd Superannuation Fund	250,000	0.24
Mr Neville John Bassett	250,000	0.24
Mr Norman Grafton	200,000	0.19
Mrs Sharin HL Grafton	200,000	0.19
Miss Angela M F Grafton	150,000	0.15
TOTAL	101,825,000	98.72

Item 36 - Distribution of Additional Securities by Category

Number of Holders	Options Held	Percentage
0	0
0	0
0	0
33	1,175,000	1.14
21	101,975,000	98.86
54	103.150.000	100.00