SCIDEV LTD — Regulatory Filings 2003

Dec 30, 2003

Intec Ltd

ASX Code: INL ABN 25 001 150 849

Superior and Sustainable Metals Production

Gordon Chiu Building J01 Department of Chemical Engineering Maze Crescent University of Sydney NSW 2006 Australia

Telephone: +612-9351-6741 Facsimile: +612-9351-7180 Email: mail@intec.com.au Website: www.intec.com.au

31 December 2003 ASX Announcement Company Announcement Office

The Directors of Intec Ltd (ASX Code – INL) advise that IVNL Gold Pty Ltd (IVNL), a company jointly owned by INL and the Ivanhoe Mines Ltd group $(ASX)$ Code – IVN, itself a $23.2%$ shareholder in INL), has been negotiating with Messrs David McEvoy and Stephen Longley from PricewaterhouseCoopers (Receivers and Managers of Western Metals Copper Limited (In Liquidation) for the purchase of the Hellyer Metals Project (the Project).

Accordingly, IVNL has today entered into the Hellyer Metals Sale and Purchase Agreement (SPA) as purchaser of the Project for a provisional purchase price of A$1,597,973. IVNL's obligations under the SPA are guaranteed as to A$270,000 by Ammtec Ltd (ASX Code – AEC, one of the world's largest metallurgical and minerals testing consultancies) and by INL and IVN jointly as to the balance. IVN has the right, at its election prior to the Completion Date (expected within thirty days), to participate in up to half of the beneficial acquisition by IVNL.

The Project is presently on care and maintenance and principally comprises:

• 1. the Burnie metallurgical research and development facility;
• 1. the Hellyer mining and exploration tenements (including Que River and the Hellyer tailings dam): and
• 1. the Hellver mill:

together with associated intellectual property.

The Burnie facility is being acquired by IVNL on trust for AEC for an attributable price of A$270,000 and consists of the freehold property (including several buildings) and numerous items of plant and equipment.

The Hellyer tailings dam has been expertly maintained and contains significant amounts of gold, zinc, lead, silver and copper (in descending order of value) above ground which, at current metals prices, have an aggregate in-situ value of approximately US$1.2 billion (equivalent to approximately A$1.6 billion at the present US$/A$ exchange rate).

The high metal values in the tailings dam are due to the refractory nature of the original Hellyer ore, from which, despite the state-of-the-art crushing, grinding and flotation circuits at the Hellyer mill, less than 80% of the contained zinc was recovered, while precious metals recoveries were very low.

Preliminary metallurgical testwork carried out on samples of the refractory Hellyer tailings has indicated that the Intec Process can achieve gold and silver recoveries that are considerably higher than those delivered by conventional cyanide leaching methods. Additionally, Intec's chloridebased leach circuit achieves very high extractions of Hellyer tailings' zinc, lead and copper values.

These overall extractions give rise to a significant potential Hellyer Metals Project valuation. though only through using the Intec Process. Consequently an Intec Process development program for the Hellver Metals Project has been worked on jointly over the last six months by Western Metals technical personnel in Burnie, Tasmania and INL's chemists and engineers in Sydney.

The Hellver tailings feedstock has been used during December 2003 in the commissioning of Intec's recently-constructed gold process pilot plant, situated on the premises of Metcon Laboratories (wholly-owned by AEC) at Brookvale in northern Sydney and funded by IVN (which is the leading Intec Process licensee). In 2004 a full pilot plant campaign on the Hellver tailings will be undertaken at Brookvale, leading to the design, construction and operation of a polymetallic demonstration plant at AEC's Burnie research facility.

Although the employment of the Western Metals personnel at Burnie will largely be terminated prior to the Completion Date, it is anticipated that the majority of staff will be offered new positions with Ammtec in Burnie under the leadership of Dr Geoffrey Richmond, who has extensive experience in bringing hydrometallurgical technology to successful commercial realisation. The Hellver Metals Project would be the cornerstone project for Ammtec at Burnie, but its research facility there would also be available for additional mineralogical testwork on behalf of third parties.

Importantly, treatment of the Hellyer tailings effects an environmental improvement of the Hellyer site by removal of heavy metals and recovery of gold and silver without cyanidation. Success by IVNL at Hellyer is expected to precede similar profitable polymetallic tailings dams cleanups worldwide using the enhanced base and precious metals extractive capabilities of the Intec Process. In addition, the successful use of the Intec Process at Hellyer will demonstrate a new and advantageous development route for polymetallic orebodies. The Intec Process polymetallic demonstration plant at Burnie will be available to third parties for this purpose under the operational control of Ammtec.

The 1.5 mtpa Hellyer mill is being maintained in excellent condition and, in addition to treating Hellver tailings, IVNL will encourage the milling and flotation on a toll treatment basis of ores sourced from the other regional metals producers.

Western Metals had previously been in discussion with Pasmineo Limited concerning the environmentally beneficial treatment of zinc-bearing residues currently stockpiled at its smelter at Risdon, Tasmania. INL has already conducted laboratory testwork on other zinc-bearing residues that lead it to anticipate that the residues at Risdon would be a profitable supplementary feedstock alongside the Hellyer tailings. Now that the Hellyer Metals Project is definitely being acquired, recent discussions between Pasmineo and INL on this subject will be progressed early in 2004.

Finally, as one of the world's leading minerals exploration companies and with its existing nearby Savage River iron ore mining operations. IVN would be in an ideal position to evaluate and potentially explore Hellyer's accompanying highly prospective exploration/mining tenements.

In summary, the overall effect of the above transaction is as follows:

• 1. Operation of the Burnie facility by AEC as a continuing centre of metallurgical excellence, with the Hellver Metals Project as its cornerstone commitment.
• 1. Maximisation of employment and value-creation in Tasmania by extracting and recovering the optimal metal values from the Hellver tailings dam via the Intec Process.
• 1. Simultaneous environmental improvement of the Hellyer site by removal of heavy metals and recovery of gold and silver without cyanidation.
• 1. Toll treatment of ores and residues to assist other existing Tasmanian operations and including neighbouring metals projects currently under development by third parties.
• 1. Evaluation and potential exploration by IVN of the Hellyer tenements in synergy with its existing nearby Savage River operations.

Yours sincerely

Philip R. Wood

Philip R Wood Managing Director and Chief Executive Officer.