ROX RESOURCES LIMITED — Interim / Quarterly Report 2004

Jul 25, 2004

Quarterly Report

For the Quarter Ended 30 June 2004

HIGHLIGHTS

The Company completed the acquisition of its Menzies project, 130km north of Kalgoorlie, and listed on the ASX on 27 April 2004 after raising $4.5 million.

Current resources at Menzies total 153,563 ounces (1.7Mt @ 2.75 g/t) and the inaugural drilling programme successfully identified three new mineralised zones. This success will be followed up with further drill programmes as a matter of priority as the new mineralised zones have the potential to enhance the prospect for an increase in resources. Significant drilling intercepts include:

2 metres @ 10.8 g/t from 31 metres depth at First Hit 1 metre @ 15.1 g/t from 37 metres depth at Lady Harriet 4 metres @ 4.0 g/t from 70 metres depth at Lady Harriet 2 metres @ 8.6 g/t from 59 metres depth at Lady Shenton

Exploration and Development Activities

RC Drilling

A 2,000 metre RC drilling program was completed testing a number of targets defined by prior drilling. Assays have been received with significant intercepts as follows:

2 metres @ 10.8 g/t from 31 metres depth at First Hit 1 metre $\omega$ 15.1 g/t from 37 metres depth at Lady Harriet 4 metres $\circledR$ 4.0 g/t from 70 metres depth at Lady Harriet 2 metres @ 8.6 g/t from 59 metres depth at Lady Shenton

The drill intercepts from First Hit and Lady Shenton are significant as they indicate the potential for significant zones of mineralisation extending south (First Hit) or north (Lady Shenton) of current open pits. These zones will be followed-up with RC drilling as a priority.

The intercepts from Lady Harriet further extend an ore shoot south of the Lady Harriet open pit, which together with unmined zones beneath the pit constitute a resource currently being estimated.

Full drilling results above a $1 g/t$ Au cut-off are included in the attached table.

Resource Estimation

Current resources stand at 153,563 ounces (1.73 Mt @ 2.75 $g/t$ ) made up from seven deposits. Rox has reviewed the data on each of these deposits and initiated remodelling of the resources. As each deposit is remodelled, new pit optimisations to determine minable ore reserves will be run using more favourable economic criteria than those applied during prior mining activities in 1997-1999, e.g. higher gold price (A$550/oz vs. A$450/oz previously), and lower royalty payments (1% NSR, equivalent to about $$0.50/t$ vs. $3.00/t previously). It is anticipated that a revised resource and reserve statement will be made during the next quarter.

Work Planned

An aggressive exploration campaign is planned for the next quarter with a 7,000 metre RAB drilling programme and a 4,000 metre RC drilling programme expected to be completed.

The RAB drilling will test a number of old workings and soil anomalies. A particular focus will be a zone of old workings that lie within a 1km x 0.2km soil anomaly with gold values peaking over 100ppb. This area has had little previous drilling and represents an attractive target on the same mineralised structure as the high grade Selkirk and First Hit gold mines to the north. Other targets are along strike from the Aspacia, Lady Shenton and First Hit mines.

The RC drilling is scheduled to commence immediately after the RAB drilling and will follow-up the new zones of mineralisation discovered at First Hit and Lady Shenton, and will test other targets identified from resource modelling.

Financial

As at 30 June 2004, the Company had 32.27 million shares on issue and cash on hand of $3.36 million.

Hole	GDA East	GDA North	Dip	Azimuth(Mag)	Depth (m)	From	Tо	Interval	Au g/t*
FHRC0001	308625	6713650	$-60°$	90%	115	31	33	$\overline{2}$	10.78
GARC0001GARC0001	309922	6711623	-60%	53%	90	6064	6168	1	1.132.06
								4
GARC0002	309918	6711645	$-60^{\circ}$	53%	95	58	59	1	1.71
GARC0002						62	64	2	1.12
GARC0002GARC0002						7276	7379	13	$1.04,$1.12
GARC0003	309910	6711689	$-60°$	53%	90	61	62	1	1.18
LHRC0001	310054	6709925	$-60°$	53%	136	41	43	2	2.75
LHRC0001LHRC0001						4655	$47,$	1	1.44
LHRC0001						132	56133	11	2.661.34
LHRC0002	310048	6710072	$-60°$	530	43.	37	38	1	15.12
LHRC0003	310032	6710060	$-60^{\circ}$	53%	80	48	51.	3	1.59
LHRC0003						53	55	2	2.29
LHRC0003						67	68	1	1.52
LHRC0004	310017	6710048	$-60°$	53%	130	86	87	$\mathbbm{1}$	2.78
LHRC0005	310033	6709985	-60%	53%	140	20	21	1	1.72
LHRC0005						104	106	2	2.58
LHRC0006	310074	6709959	$-60°$	53%	90	45	$47,$	$\mathbf 2$	1.89
LHRC0006						50	52	2	3.40
LHRC0006						70	$74,$	4	4.00
LSRC0001	308929	6712589	$-60°$	53%	90	72	73.	1	1.02
LSRC0001						75	76	1	2.20
LSRC0001						88	90	2	2.12
LSRC0002	309005	6712571	$-60°$	53%	90.	59	61.	$\boldsymbol{2}$	8.59
LSRC0003	307963	6712046	$-60°$	53%	120	20	21	$\mathbbm{1}$	3.58
PIRC0001	310319	6709792	$-60°$	53%	90.	NSR
PIRC0002	310302	6709779	$-60°$	53%	120	68	69	1	1.35
PIRC0003	310382	6709664	$-60^\circ$	530	103	$_{\rm NSR}$
SYRC0001	308062	6714225	-60%	590.	91	NSR
WRRC0001	309774	6710441	$-(60°$	53%	110	73.	74.	1	1.07
WRRC0001						95.	96	1	2.45
WRRC0002	309748	6710474	$-60^{\circ}$	53%	125	96.	97	1	1.99
WRRC0002						118	120	$\boldsymbol{2}$	4.54
WRRC0003	309745	6710520	$-60^\circ$	53%	91	NSR

Menzies Drill Results June 2004

* 1 g/t Au minimum cut-off

Samples were obtained from face sampling hammer RC holes. Samples were collected at 1m intervals, riffle split, and assayed by AAS. Any result greater than $2 g/t$ Au was re-assayed by 50 g fire assay.

Dated this 26th day of July 2004.

Signed on behalf of the Board of Rox Resources Limited.

Improvement

IAN MULHOLLAND Managing Director

Please direct enquiries to: Ian Mulholland Telephone: (08) 9486 4537

The information on mineralisation contained in this report accurately reflects information compiled by Mr lan Mulholland B.Sc (Hons.), M.Sc., F.Aus.I.M.M., F.A.I.G., who is a Competent Person (as defined by the Australasian Code for Reporting of Identified Mineral Resources and Ore Reserves) with relevant experience in relation to such mineralisation and is an officer of Rox Resources Limited.

APPENDIX 5B Mining Exploration entity quarterly report

Name of entity

ROX RESOURCES LIMITED

ACN or ARBN

107 202 602

Quarter ended ("current quarter") June 2004

Consolidated statement of cash flows

	Cash flows related to operating activities		Current QuarterA$'000	Year to Date$(12$ months)$A'000
1.1	Receipts from product sales and related debtors
1.2	Payments fordevelopment(b)production(c)	(a) exploration and evaluation	(245)	(245)
1.3	administration(d)Dividends received		(42)	(42)
1.41.51.6	Interest and other items of a similar nature receivedInterest and other costs of finance paidIncome taxes paid	37	37
1.7	OtherNet Operating Cash Flows		(250)	(250)
1.8	Cash flows related to investing activitiesPayment for purchases of:	(a) prospects(b) equity investments(c) other fixed assets	(500)(14)	(500)(14)
1.9	Proceeds from sale of:	(a) prospects(b) equity investments(c) other fixed assets
	1.10 Loans to other entities1.11 Loans repaid by other entities
	1.12 Other
	Net investing cash flows		(514)	(514)
	1.13 Total operating and investing cash flows (carriedforward)		(764)	(764)

1.13 Total operating and investing cash flows (brought
forward)	(764)	(764)
Cash flows related to financing activities
1.14 Proceeds from issues of shares (net of costs)	4,126	4,126
Proceeds from sale of forfeited shares1.15.
1.16 Proceeds from borrowings
1.17 Repayment of borrowings
1.18 Dividends paid
1.19 Other
Net financing cash flows	4,126	4,126
Net increase (decrease) in cash held	(3,362)	(3,362)
1.20 Cash at beginning of quarter/year to date
1.21 Exchange rate adjustments to 1.20
1.22 Cash at end of quarter	3,362	3,362

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

• 1.23 Aggregate amount of payments to the parties included in item 1.2
• 1.24 Aggregate amount of loans to the parties included in item 1.10
• 1.25 Explanation necessary for an understanding of the transactions

$N/A$

Non-cash financing and investing activities

2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

During the period the Company completed the acquisition of its Menzies project. This involved the payment of $500,000 cash plus the issue of 2,500,000 Rox Resources Limited shares at $0.20 each.

Current quarter

68

$\overline{a}$

$A'000

2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

$Nil$

Financing facilities available

Add notes as necessary for an understanding of the position.

	Amount available$A'000	Amount used$A'000
3.1 Loan facilities
3.2 Credit standby arrangements

Estimated cash outflows for next quarter

		$A'000
4.I	Exploration and evaluation	400
4.2	Development	$\overline{\phantom{0}}$
	Total	400

Reconciliation Of Cash

Reconciliation of cash at the end of the quarter (as shown inthe consolidated statement of cash flows) to the related itemsin the accounts is as follows.		Current quarter$A'000	Previous quarter$A'000
5.I	Cash on hand and at bank	(1)
5.2	Deposits at call	3,363
5.3	Bank overdraft
5.4	Other (provide details)
	Total: cash at end of quarter (item 1.22)	3,362

Changes in interests in mining tenements

See attached Schedule A.

	Total number	Number quoted	priceIssuepersecurity (cents)	Amount paid up persecurity (cents)
7.1Preferencesecurities(description)
Changes during7.2quarter
7.3Ordinary
securities	32,272,000	22,572,000
Changes during7.4quarter- Issued	24,772,000	22,572,000	$0.20	$0.20
Convertible debt7.5securities(description andconversion factor)
Changes during7.6quarter
			Exercise Price	Expires
7.7Options(description andconversion factor)	5,250,000	Nil	$0.20	31 January 2009
	1,200,000	Nil	$0.20	30 April 2007
Issued during7.8quarter	1,200,000	Nil	$0.20	30 April 2007
7.9 Exercised duringquarter
7.10 Expired duringquarter
7.11 Debentures(totals only)
7.12 Unsecured notes(totals only)

Issued and quoted securities at end of current quarter

Compliance statement

• $\mathbf{L}$ This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Law or other standards acceptable to ASX.
• $2.$ This statement does give a true and fair view of the matters disclosed.

Sign here:

Date: 26 July 2004

Company Secretary

Print Name: Brett Dickson

Tenement Reference	Nature of Interest	Interest at beginning ofquarter	Interest at end ofquarter
M29/14	Owned	$0%$	100%
M29/88	Owned	$0%$	100%
M29/153	Owned	$0%$	100%
M29/154	Owned	$0%$	100%
M29/157	Owned	$0%$	100%
M29/184	Owned	$0%$	100%
M29/212	Owned	$0%$	100%
MLA29/223	Owned	$0%$	100%
MLA29/225	Owned	0%	100%
L29/41	Owned	$0%$	100%
L29/42	Owned	$0%$	100%
L29/43	Owned	$0%$	100%
L29/44	Owned	$0%$	100%
L 29 /58	Owned	$0%$	100%

Interests in mining tenements acquired or increased during the quarter

Glossary

М	Mining Lease
MLA	Mining Lease Application

$\mathbf L$ Miscellaneous Licence