TASMAN RESOURCES LTD — Interim / Quarterly Report 2005

Apr 28, 2005

Level 40, Exchange Plaza 2 The Esplanade, Perth, Western Australia 6000 Telephone: (08) 9282 5889 Facsimile: (08) 9282 5866

Website: www.tasmanresources.com.au

ASX QUARTERLY EXPLORATION REPORT FOR PERIOD ENDED 31^st MARCH 2005

HIGHLIGHTS

Minerals

• $\bullet$ Drilling at Marathon South has been deferred due to rig availability, and is now expected to commence in May 2005. Drill site clearances and site preparations have been conducted. Tasman has been successful in obtaining support funding for two holes through the SA Government's PACE 2 exploration initiative.
• Exploration licences have been granted on the Gawler Craton over two new areas considered prospective for nickel and gold.

Geothermal Energy

All of Eden Energy's eight Geothermal Exploration Licences have now been granted in $\bullet$ South Australia. Eden have retained the services of Professor James Cull, a leading expert in geothermal issues, of Monash University, to assist in the exploration of these areas.

Coal Bed Methane & Abandoned Mine Methane

Mapping of coal mines and coal seams in South Wales to identify abandoned coal mine gas $\bullet$ and suitable un-worked coal seams for drill testing later in 2005.

Hydrogen/Hythane

• Memoranda of Understanding signed or negotiated with six major cities in China to introduce Hythane® (natural gas/hydrogen mix) as low emission fuel for urban buses.
• Demonstration project has commenced (to be completed by September 2005) to confirm the emission reductions of Hythane. This project will involve the building, testing and demonstration of a Hythane powered Chinese bus.

Capital Raising

Commitment received from the major Chinese controlled investor in Eden Energy to ۰ subscribe an additional AUD \$2 million into both Tasman and Eden, and to subscribe or arrange a further USD \$2-3 million into Hydrogen China (BVI) Ltd, which is undertaking the Chinese Hythane project.

MINERAL EXPLORATION ACTIVITIES

Tasman Resources NL holds a 100% interest in the "Lake Torrens Project" comprising Exploration Licences 2989, 2733, 2772, 2832, 3109, 3123, 3140, 3174, 3175, 3176, 3177, 3209 3254, 3260 and 3261 (see Figure 1). In addition, two exploration licences were granted over prospective areas on the Gawler Craton, at Mulgathing, 70km north west of Tarcoola (EL 3306), and Wartaka, 50km west of Port Augusta (EL 3307).

Marathon South Prospect

The resumption of drilling at Marathon South has been delayed due to an extension in a drilling programme for another client, and a requirement for scheduled maintenance of the drill rig prior to commencing the Tasman programme. Drill site clearances and preparations at Marathon South have been completed, and drilling is expected to commence in early- to mid-May (see Figure 4).

Tasman has been successful in obtaining support funding for two of the proposed four holes at Marathon South through the SA Government's PACE 2 exploration initiative.

Background:

Tasman's 100% owned Marathon South Prospect is located 24 km north east of Olympic Dam in South Australia. Tasman completed the first drill hole into the prospect MS 1 in November 2004. The hole was completed at 830m after intersecting 270m of variably hematite-silica-albite-sericitecarbonate altered breccias, containing significant igneous components (mainly dykes, igneous clasts and probable tuffs).

The breccias show strong similarities with rocks comprising the nearby Olympic Dam deposit, however although weakly mineralised, no significant base metal or gold values were obtained in MS 1. Tasman believes it may have discovered a large volcanic breccia system which could host a substantial copper-gold deposit. As at Olympic Dam, the size and complexity of such systems require the drilling of a number of relatively deep holes to adequately assess the potential.

ENERGY ACTIVITIES

Eden Energy Ltd (Tasman 64.33%)

South Wales - Coalbed Methane/Coalmine Methane/Natural Gas $\bullet$

During the quarter, Eden, in association with its joint venture partner in Wales, commenced a detailed mapping of the coalmines and coal seams in the $400 \text{km}^2$ tenement area (see Figure 2). The purpose of this exercise is to determine the potential for tapping significant quantities of abandoned mine gas, and for identifying primary targets for testing unworked coal seams for possible development of coal seam gas.

Advanced directional drilling is now available in the United Kingdom and the possibility exists to develop a coal bed methane gas field using either conventional vertical drilling, or alternatively development of a gas field utilising directional drilling along the coal seams.

Preliminary steps have been taken to locate a suitable drilling rig for the initial testing of the coal, and as soon as the mapping exercise is completed and a suitable rig can be located, drilling is planned to test the coal mine gas and the gas content of the coal and suitability for production of coal bed methane.

Hydrogen/Hythane Projects

Eden Energy Ltd is acquiring a 20% interest in Brehon Energy plc ("Brehon") and a 49% interest in Brehon Far East. Brehon holds patents, trademarks and know how for Hythane (a mixture of natural gas and hydrogen which dramatically reduces emissions) and to NASA developed cryogenic storage for hydrogen. Brehon Far East holds the total marketing rights for the Asia/Pacific region for the Brehon technology.

During the quarter, significant progress has been made in the Hythane project in China. There is a potential market for in excess of 500,000 Hythane powered buses in China. To date, memoranda of understanding have been signed or negotiated with 6 major Chinese cities (potential market in excess of 70,000 buses). These Memoranda of Understanding have involved the Environmental Protection Bureau, which has indicated support for the Hythane project in China.

A Chinese demonstration project is planned for April-September 2005 in which a Hythane powered bus will be built, tested and demonstrated. Subject to the outcome of that trial, preliminary approval for inclusion of Hythane in the Chinese Government's 15 City Clean Air Program has been obtained. This would immediately expose the Hythane project to 15 very large cities in China, all of which have significant air pollution problems.

Preliminary agreement has also been reached with engine controller manufacturers, Chinese engine manufacturers and Chinese bus manufacturers to work in conjunction with these relevant parties to develop the product range necessary to implement Hythane as a major vehicle fuel in China.

Suitable hydrogen, particularly from waste streams produced by other industrial processes have been identified.

Significant additional work has taken place on several patents, and since the end of the quarter, an application has been lodged for a new patent in respect of a sophisticated blender for producing Hythane (blending hydrogen and natural gas). Several other patents are currently being developed.

Top level Chinese central government and academic support for the Hythane technology has been obtained and significant interest has been shown by commercial and corporate interests in the prospect of listing the Hong Kong based Hydrogen China (BVI) Ltd on the Hong Kong Stock Exchange possibly during the next six to twelve months.

Group Capital Raising

The existing major Chinese-controlled investor in Eden Energy Ltd, which invested AUD \$ 2 million into Eden in November 2004, has agreed:

• $(i)$ to subscribe by 30 June 2005, a further \$2 million in equity to the working capital of Eden at 15 cents per share;
• to also take a placement of AUD \$ 2 million in securities in Tasman Resources NL (10) $(ii)$ million shares at 15 cents each and 10 million 28 February 2006 $20^{\circ}$ options at 5 cents each); and
• $(iii)$ to undertake to raise a further USD \$ 2-3 million as working capital for Hydrogen China BVI Ltd, the Hong Kong based company which will undertake the Chinese project.

The placement of shares and options in Tasman Resources will be subject to a shareholders' resolution, and the necessary meeting will be convened within the next seven days.

This capital raising has been agreed in replacement for the previously announced proposed investments by two subsidiaries of China Rail, which, due to currency control restrictions, has advised that it cannot proceed with its \$2 million subscription into Tasman Resources NL. They have however indicated a desire to still participate in the Chinese Hythane projects.

The corporate structure showing the inter-relationship of Tasman Resources NL, Eden Energy

Ltd and Brehon Energy PLC and its subsidiaries is attached to this report.

Geothermal Exploration

During the quarter, Eden was granted a further five geothermal exploration licences in South Australia. Eden now holds GELs 166, 167, 168, 169, 175, 176, 177 and 185 (see Figure 3).

An integrated work programme to assess the geothermal targets in the GELs has commenced. Professor James Cull of Monash University, a leading expert in geothermal issues has been engaged to assist Eden with the assessment of the various geothermal targets.

This concept involves drilling wells deep into the Earth's crust (up to 4.5 km deep) into specific rocks that have trapped significant heat over extended periods of time. Water is then injected down one well and then pumped up a second (or more) well. The aim is to recover water at a temperature of greater than 200°C, which is then used to generate electricity via a heat exchange plant. In order for the rocks to retain sufficient heat, a very thick insulating sedimentary "blanket" is required.

A key factor in commercialisation is the distance from the geothermal wells to the nearest power grid: the further the distance, the greater the cost of connecting to the grid for distributing the electricity. In the case of the northern applications, the location of the nearest power transmission lines is shown on Figure 3.

Eden Energy's strategy is to test the suitability of the target areas and drill test wells. If successful, Eden plans to establish a power generation facility that can be used to generate electricity for sale into the grid. Alternatively, the power may be used to produce renewable hydrogen for use as a fuel or as an additive to methane/CNG to produce Hythane®, both of which are proposed to be marketed through the downstream technology developed by Brehon. Eden through its relationship with Brehon Energy has access to cryogenic storage technology, which would enable the transport of liquid hydrogen by conventional tankers. Alternatively, the hydrogen could be either transported in pipelines as pure hydrogen or added to natural gas.

There are five targets covered by Eden's GELs, comprising a range of different target types:

• 1. GELs 166 and 167 cover the West Well geophysical anomaly, a interpreted radiogenic iron oxide system buried beneath an estimated 3km of Adelaide geosyncline sediment. The area is approximately 60km west of Leigh Creek.
• 1. GEL 168 covers an interpreted thermally enhanced Hiltaba age granite, adjacent to the West Well target at Mulgaria, again buried beneath several kilometres of Adelaidean sediments.
• 1. GEL 169 is located approximately 80km south of Moomba, near Bollards Lagoon, and targets a proposed analogue of the Geodynamics target at Habanero.
• 1. GEL 177 covers an area with known high thermal temperature gradients over a gravity low interpreted to be a buried granite and/or a thicker sub-basin of the Eromanga Basin near Mungeranie on the Birdsville Track.
• 1. To the north of Renmark, a geothermal anomaly identified in early oil exploration wells is associated with the Nadda/Berri/Murray Basin.

CORPORATE

Finance

At 31^st March 2005 Tasman had cash reserves of \$1.701 million.

At 31^st March 2005 Eden had cash reserves of \$ 0.856 million.

Greg Solomon Executive Chairman

The interpretations and conclusions reached in this report are based on current geological theory and the best evidence available to the authors at the time of writing. It is the nature of all scientific conclusions that they are founded on an assessment of probabilities and, however high these probabilities might be, they make no claim for complete certainty. Any economic decisions that might be taken on the basis of interpretations or conclusions contained in this report will therefore carry an element of risk.

The information in this announcement, insofar as it relates to Mineral Exploration activities, is based on information compiled by Graham M. Jeffress, who is a member of the Australian Institute of Geoscientists, and who has more than five years experience in the field of activity being reported on. It should not be assumed that the reported Exploration Results will result, with further exploration, in the definition of a Mineral Resource.

Tasman Resources - South Australian Mineral Exploration

Figure 1: South Australia - Lake Torrens Project Location and tenement map, showing Tasman exploration tenements.

South Wales - Energy Projects Farm-in Area

Figure 2: South Wales Project Location and tenement map; PEDLs cover Coal Bed/Coal Mine Methane and conventional hydrocarbon plays

South Australian Geothermal Exploration

Figure 3: Eden Energy's South Australian Geothermal Exploration Licences overlain on AusTherm03 estimated temperature at 5km depth

Marathon South Prospect

Figure 4: Marathon South Residual Gravity Image (residual of 128 pass hanning filtered variable density bouguer
gravity, using December 2004 infill gravity data) showing existing drilling and proposed collars for follow-up drilling

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

Name of entity

TASMAN RESOURCES NL

ABN

85 009 253 187

Quarter ended ("current quarter") 31 March 2005

Consolidated statement of cash flows

Cash flows related to operating activities		Current quarter \$A'000	Year to date (9 months)
			\$A'000
1.1	Receipts from product sales and related debtors	0	0
1.2	Payments for (a) exploration and evaluation (b) development production $\left( c\right)$	(98)	(722)
	administration (d)	(249)	(580)
1.3	Dividends received	Ð	U
1.4	Interest and other items of a similar nature received	32	51
1.5	Interest and other costs of finance paid	$\Omega$	$\Omega$
1.6	Income taxes paid - GST Paid	(22)	(111)
1,7	Income Taxes - GST Refunds Received Other (provide details if material)	54	87
	PACE1 Grant Funding - first 50%	40	40
	Net Operating Cash Flows	(243)	(1,235)
	Cash flows related to investing activities
1.8	Payment for purchases of: (a)prospects	0	0
	(b) equity investments	(373)	(1, 154)
	(c)other fixed assets	0	(3)
1.9	Proceeds from sale of: (a) prospects (b)equity investments	0 0	0
	(c) other fixed assets	0	0 0
1.10	Loans to other entities	0	0
1.11	Loans repaid by other entities	0	0
1.12	Other (provide details if material)	0	0
	Net investing cash flows	(373)	(1, 157)
1.13	Total operating and investing cash flows (carried forward)	(616)	(2, 392)

1.13	Total operating and investing cash flows (brought forward)	(616)	(2,392)
	Cash flows related to financing activities
1.14 1.15	Proceeds from issues of shares, options, etc. Proceeds from sale of forfeited shares	0	4,772
1.16	Proceeds from borrowings	U 0	0
1.17	Repayment of borrowings	0	0
1.18	Dividends paid	0	0
1.19	Other (provide details if material) Share Issue Costs	(7)	(280)
	Net financing cash flows	(7)	4,492
	Net increase (decrease) in cash held	(623)	2,100
1.20 1.21	Cash at beginning of quarter/year to date Exchange rate adjustments to item 1.20	3,180 0	457 0
1.22	Cash at end of quarter	2,557	2,557

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

		Current quarter \$A'000
1.23	Aggregate amount of payments to the parties included in item 1.2	151
1.24	Aggregate amount of loans to the parties included in item 1.10

1.25	Explanation necessary for an understanding of the transactions
	Management Fees, as per agreement, were paid during the quarter to a company of
	which Mr GH Solomon and Mr DH Solomon are directors.
	Legal Fees paid during the quarter to a firm of which Mr GH Solomon and Mr DH
	Solomon are partners.
	Bona-fide reimbursement of expenses for the period to 31 March 2005
	Directors Fees and Superannuation paid during the period.

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

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

Not applicable

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	Nil	Nil
3.2	Credit standby arrangements	Nil	Nil

Estimated cash outflows for next quarter

		-SA'000
4.1	Exploration and evaluation	500
4.2	Development
	Total	500

Subsequent to end of quarter additional capital has been raised to fund part of this expenditure.

Reconciliation of cash

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.		Current quarter \$A'000	Previous quarter \$A'000
-5.1	Cash on hand and at bank	1.057	1,680
5.2	Deposits at call	1,500	1,500
53	Bank overdraft	0	Đ.
5.4	Other (provide details)	0	Ð
	Total: cash at end of quarter (item 1.22)	2,557	3,180

Changes in interests in mining tenements

		Tenement reference	Nature of interest (note (2))	Interest at beginning	Interest at end of
				of quarter	quarter
6.1	Interests in mining tenements relinquished,
	reduced or lapsed
6.2	Interests in mining		(formerly)
	tenements acquired or	EL 2989	Licence granted (EL 2340)	100%	100%
	increased	EL 3123	Licence granted (EL 2507)	100%	100%
		EL 3140	Licence granted (EL 2543)	100%	100%
		EL 2733	Licence granted	100%	100%
		EL 2772	Licence granted	100%	100%
		EL 2832	Licence granted	100%	100%
		EL 3109	Licence granted	100%	100%
		EL 3174	Licence granted	100%	100%
		EL 3175	Licence granted	100%	100%
		EL 3176	Licence granted	100%	100%
		EL 3177	Licence granted	100%	100%
		EL 3209	Licence granted (EL 2594)	100%	100%
		EL 3254	Licence granted	100%	100%
		EL 3260	Licence granted	100%	100%
		EL 3261	Licence granted	100%	100%
		EL 3306	Licence granted	100%	100%
		EL 3307	Licence granted	100%	100%
		Outstanding Applications:
			ELA 62/04, ELA 63/04, ELA 64/04, ELA 65/04, ELA 66/04, ELA 204/04,
			ELA 205/04, ELA 777/04, ELA 111/05
			New Applications this quarter:
		ELA 111/05
			Geothermal Licences held in the name of Eden Energy Ltd
		GEL 166	Licence granted	100%	100%
		GEL 168	Licence granted	100%	100%
		GEL 177	Licence granted	100%	100%
		GEL 185	Licence granted	100%	100%
			Outstanding Geothermal Licence Applications in Name of
		Eden Energy Ltd
			GELA 167, GELA 169, GELA 175, GELA 176
		Outstanding Petroleum Exploration Licence Application in the Name of
		Eden Energy Ltd
		PELA 183

Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights together with prices and
dates.

		Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note 3) (cents)
7.1	Preference +securities (description)	NOT APPLICABLE
7.2	Changes during
	quarter (a) Increases
	through issues
	(b) Decreases
	through returns of
	capital, buy- backs,
	redemptions
7.3	*Ordinary	86,160,788	86,160,788
7.4	securities Changes during
	quarter
	(a) Increases
	through issues (b) Decreases
	through returns
	of capital, buy- backs
7.5	*Convertible	NOT
	debt	APPLICABLE
	securities (description)
7.6	Changes during
	quarter (a) Increases
	through issues
	(b) Decreases
	through securities
	matured,
7.7	converted Options			Exercise price	Expiry date
		43,795,417	43,795,417	20 cents	28 Feb 2006
7.8	Issued during	NIL.	NIL
7.9	quarter Exercised
	during quarter	NIL	NIL
7.10	Expired during quarter	NIL	NIL
7.11	Debentures	NOT
	(totals only)	APPLICABLE
7.12	Unsecured	NOT APPLICABLE
	notes (totals only)

Compliance statement

• This statement has been prepared under accounting policies which comply 1 with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).
• $\overline{2}$ This statement does give a true and fair view of the matters disclosed.

RAYMOND FRANCIS BUSCALL - COMPANY SECRETARY Date: 29 April 2005

Notes

• The quarterly report provides a basis for informing the market how the entity's 1. activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
• $\overline{2}$ The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
• 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
• 4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.
• 5 Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

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