PRODIGY GOLD NL — Share Issue/Capital Change 2003

Aug 31, 2003

1 September 2003

The Announcements Office Australian Stock Exchange Limited Level 3, 20 Bridge Street SYDNEY NSW 2000

Dear Sir

Issue of Shares

Tantalum Australia NL advises that it has placed 11,781,110 ordinary fully paid shares in the Company at an issue price of 9 cents per share to raise additional working capital.

The placement has been made to a Chinese investment group that has the intention of promoting and supporting the Company's continuing sales activities and business development in the Chinese rare metal market via establishment of strategic relationships with end user customers. This strategy complements the strategic relationships already established by the company in Europe and the United States with electronics (KEMET Corporation) and aerospace customers.

Included in this issue was an issue to KEMET Corporation who have elected to maintain its 10% equity in the company pursuant to an anti dilution agreement previously approved by shareholders.

Yours faithfully

Peter Farrah Company Secretary