TASMAN RESOURCES LTD — Interim / Quarterly Report 2005

Mar 15, 2005

TASMAN RESOURCES N.L. (A.C.N. 009 253 187)
AND CONTROLLED ENTITY

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INTERIM FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

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DIRECTORS' REPORT

Your directors submit the financial report of the economic entity for the half-year ended 31 December 2004.

DIRECTORS

The names of the directors who held office during or since the end of the half-year:

Gregory Howard Solomon, LLB (Chairman) Douglas Howard Solomon, BJuris LLB (Hons) (Non-Executive) Guy Touzeau Le Page, B.A., B.Sc. (Hons)., M.B.A., ASIA., MAusIMM (Non-Executive)

PRINCIPAL ACTIVITY

The principal activity of the economic entity during the financial year was to incur costs in relation to exploration on mining tenements.

REVIEW OF OPERATIONS

South Australia

EL 3123 (formerly EL 2507), EL 3140 (formerly EL 2543), EL 3209 (formerly EL 2594), EL 2733, EL 2772, EL 2832. EL 2989 (formerly EL 2340). EL 3109, EL 3260, EL 3261, EL 3174, EL 3175, EL 3176 and EL 3177(Tasman Resources N.L. - 100%). Current applications pending are ELA 682/04, ELA 62/04, ELA 63/04, ELA 64/04, ELA 65/04, ELA 66/04, ELA 204/04, ELA 685/04, and ELA 777/04.

LAKE TORRENS PROJECT

1. Corporate

During the half-year, various capital raisings by private placements and a prospectus placement were completed as follows:

Tasman Resources NL

• $(a)$ 6 August 2004 5,000,000 ordinary fully paid shares were issued at 7.5 cents per share raising \$375,000 by private placement,
• $(b)$ 8 September 2004 6,100,000 ordinary fully paid shares were issued at 7.5 cents per share raising \$457,500 by private placement. 6,100,000 free options to acquire ordinary fully paid shares on or before the 28 February 2006 were issued on a one for one basis with the above shares.
• $(c)$ 9 November 2004 50,000 ordinary fully paid shares were issued at 8 cents per share raising \$4,000 by private placement.
• $(d)$ 15 December 2004 5,010,000 ordinary fully paid shares were issued at 22 cents per share raising \$1,102,200 by prospectus, 1,252,500 free options to acquire ordinary fully paid shares on or before the 28 February 2006 were issued on a one for four basis with the above shares.
• $(e)$ 22 December 2004 3,248,273 ordinary fully paid shares were issued at 22 cents per share raising \$714,620 by prospectus, 812,068 free options to acquire ordinary fully paid shares on or before the 28 February 2006 were issued on a one for four basis with the above shares.

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Eden Energy Ltd

• 27 September 2004 1,200,000 ordinary fully paid shares were issued at 10 cents per share $(f)$ raising \$120,000 by private placement. 600,000 free options to acquire ordinary fully paid shares on or before the 30 September 2009 were issued on a one for two basis with the above shares.
• $(g)$ 26 November 2004 20,000,000 ordinary fully paid shares were issued at 10 cents per share raising \$2,000,000 by private placement. 10,000,000 free options to acquire ordinary fully paid shares on or before the 30 September 2009 were issued on a one for two basis with the above shares.

DIRECTORS' REPORT (Cont'd)

The funds were raised to provide ongoing working capital for the exploration and drilling programmes on the Lake Torrens Project and to fund investment into Eden Energy Ltd.

• $2.$ Cash Reserves The Cash Reserves available at the 31 December 2004 totalled \$3,179,898.
• 1. Mineral Exploration (Tasman Resources NL)
• 3.1. Exploration Tenements

The Company's tenements comprise a number of exploration licences and licence applications in South Australia, comprising several projects, namely the Lake Torrens, THZ diamond project, Central Gawler Craton gold and diamond projects, and, the Wartaka gold project.

The Lake Torrens Project that is located in central South Australia in the area between Lake Torrens and Lake Eyre South, immediately north of WMC Resource's Olympic Dam mine. Exploration Licences constituting the Lake Torrens Project are ELs 3123 (formerly 2507), 3140 (formerly 2543), 3209 (formerly 2594), 2733, 2772, 2832, 2989 (formerly 2340), 3109, 3174, 3175, 3176 and 3177. Licences 3006, 3007, 2988, 2642 and 2835 were relinguished during the last six months.

The Wartaka Gold Project comprises ELA 682/04 and is located west of Port Augusta.

ELAs 62/04. 63/04, 64/04. 65/04, 66/04. 204/04, 205/04 and 685/04 form the Central Gawler Craton Project and are considered prospective for gold, diamonds and base metals.

ELA 777/04 and ELs 3260 and 3261 are tenements on the margins of the Lake Torrens Project obtained to cover conceptual diamond plays.

All of these tenements are 100% owned by Tasman Resources NL.

3.2. Exploration Activities

During the half year to 31 December 2004 the economic entity undertook the following exploration activities:

Lake Torrens Project

Titan Prospect

• (a) Presentation, interpretation and modelling of geophysical data using potential field inversion, image processing and density susceptibility modelling.
• (b) Drilling two deep core holes into the Titan system.
• (c) Comprehensive geological logging, petrophysical measurements and geochemistry.
• (d) Synthesis of all available data and continued development and refinement of the geological and mineralisation model for the alteration system at Titan.

Marathon South

• (a) Extension of the detailed gravity data.
• (b) Presentation, interpretation and modelling of geophysical data using potential field inversion, image processing and density susceptibility modelling.

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• (c) Drilling one deep core hole into the Marathon South system
• (d) Comprehensive geological logging, petrophysical measurements and geochemistry.
• (e) Synthesis of all available data and continued development and refinement of the geological and mineralisation model for the alteration system at Marathon South.

DIRECTORS' REPORT (Cont'd)

Regional Exploration & Prospect Identification.

• (a) The Company continued reviewing the project area for potential basement hosted iron oxide copper gold (IOCG) "Olympic Dam-style" deposits. Existing deep drill holes, regional geophysics and all Open file data were used to identify and rank a number of areas.
• (b) A small stream sediment programme was completed over an area of outcropping Adelaidean sediments and interpreted faulting.
• (c) All areas covered by Tasman's soil sampling were reassessed and ranked for follow-up. A number of prospects were identified as requiring further visits and sampling to clarify the nature of anomalous geochemical samples and plan further work.

Diamonds

Following on from the Company's thorough study of the diamond prospectivity of South Australia in general and the Lake Torrens Project area in particular, detailed reviews of aeromagnetic data identified a number of very interesting magnetic targets with strong kimberlitic character in those parts of the Lake Torrens Project not already covered by this work.

THZ Diamond Project

Following on from the Company's thorough study of the diamond prospectivity of South Australia in general and the Lake Torrens Project area in particular, detailed reviews of aeromagnetic data identified several areas with good conceptual diamond potential, supported in several areas by kimberlite indicator minerals and/or diamonds. The Company secured ELAs over the areas of interest and initiated a review of the public domain aeromagnetic data to identify kimberlite targets.

Central Gawler Craton Project

Diamonds

A thorough study of the diamond prospectivity of South Australia in general and the Lake Torrens Project area in particular concluded that rocks of Jurassic and older age have potential to host diamondiferous kimberlite and lamproite intrusions. This was overlooked by previous explorers. Exploration licence applications were made over those parts of the central Gawler Craton identified as prospective for diamonds in this study. Detailed investigation of aeromagnetic data was commenced, with results due in early 2005.

Gold and Base Metals

The areas covered by ELA's in the central Gawler Craton region were assessed for other commodity opportunities. A number of strongly anomalous gold in calcrete and nickel in calcrete anomalies were noted. These prospects had either had no follow-up or inadequate drill testing and rank as excellent targets for follow-up work. Follow-up sampling to define drill targets is planned.

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Wartaka Gold Project

Review of open file geochemical data revealed an area of strong gold in calcrete anomalism in the Burrows Hill area on Wartaka Station. The anomalies were either untested or inadequately tested by drilling. Analogies with gold mineralisation elsewhere in the Gawler Craton were very encouraging. Follow-up sampling to define drill targets is planned.

DIRECTORS' REPORT (Cont'd)

3.3. Future Exploration Programme

During the next half year the company will continue with the following activities:

• A major campaign of exploration drilling at Marathon South.
• Re-assessment of the Titan Prospect.
• Complete assessment of unresolved regional prospects within the Lake Torrens Project $\bullet$ area.
• Geochemical sampling to define initial drill targets at the Wartaka and Central Gawler Craton project prospects.
• Finalize identification of kimberlite targets in the Company's tenements and undertake preliminary site visits and sampling.
• Continue project generation activities to identify opportunities for new projects (both 100% Tasman and joint ventures where suitable) both in South Australia and elsewhere.
• 1. Energy Projects (Eden Energy Ltd)

Eden Energy Ltd ("Eden"), a Tasman subsidiary, was incorporated to acquire energy related assets. Since incorporation. Eden has acquired an exciting portfolio of assets as detailed below.

4.1. Geothermal Exploration

Geothermal power using deep hot rocks has the potential to supply significant quantities of low cost "green" energy. This energy supply would be suitable for base load electrical power and be able to produce both desalinated water and hydrogen for transport and power applications. Furthermore, the project would also lead to significant carbon credits.

Geothermal Tenements

Eight Geothermal Exploration Licence applications were filed. Of these three (GEL 166, 168 and 177) have been offered and accepted by Eden and the remaining five (GELAs 167, 169, 175, 176 and 185) have been offered but not yet accepted by Eden.

Geothermal Exploration

Eden has identified six areas in South Australia to assess for hot rocks and geothermal power:

• In the Olympic Dam/Roxby Downs area the West Well targets;
• In the Olympic Dam/Roxby Downs area the Mulgaria target;
• West of Moomba on the Birdsville Track at Mungeranie; $\bullet$
• In the Renmark area:
• South of Moomba the Bollard's Lagoon target; and,
• Adjacent to Geodynamics Habanera project northeast of Moomba.

Future Exploration Programme

Data compilation for the various projects has commenced and Eden is preparing work programmes and budgets to undertake assessments of the relative prospectivity of each of the target areas. Geophysical modelling of the basement depths and possible hot pluton parameters, review of past seismic data and open file well completion reports, and, preliminary economic analysis is planned.

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DIRECTORS' REPORT (Cont'd)

4.2. Hydrogen Technologies and Hythane®

Eden has an agreement with Brehon Energy plc ("Brehon") to:

• subscribe for up to 20% of Brehon via the investment of up to US\$1M; and,
• establish a joint marketing company known as Brehon Far East Pty Ltd with Brehon in which ٠ Eden will hold up to 49%, to market Brehon's hydrogen related technology in the Asia/Pacific region.

Brehon controls patents and technology for:

• Hythane® equipment for blending the hydrogen and methane and an engine controller for adjusting operating parameters for engines burning Hythane:
• The Hythane® technology was developed by Frank Lynch (owner of Hydrogen Components ٠ Inc.) starting in the 1980s. Hythane® involves the addition of a small percentage of hydrogen (usually about 7% by energy) to natural gas to create a highly efficient very low emission vehicle fuel. Hythane® reduces NOx emissions by 95%, relative to diesel and significantly reduces CO2.

Hythane® has been successfully demonstrated in Denver (Colorado) in 1991, Erie (Pennsylvania) in 1993, in Montreal (Quebec) in 1995, and Coachella Valley California in 2003.

Hythane® technology builds upon existing compressed natural gas (CNG) infrastructure and equipment, is fully developed, and available for immediate rollout.

• storage technology compressed, liquid and supercritical storage tanks for Hythane®. $\bullet$ hydrogen and methane; and,
• refuelling & reliquifaction systems for dealing with Hythane®, hydrogen and methane.
• New patents in respect of cryogenic storage of hydrogen and Hythane® have been lodged. and several other new patents are being developed for other areas including a new blending system for Hythane®.

Brehon proposes to secure patents over as many critical areas of the hydrogen process as possible, and to form very strong strategic commercial alliances with major industry players to commercialise its technology.

Beijing Bus Project

Brehon has entered into a Memorandum of Understanding (MOU) with four leading Chinese groups to establish in China a project to replace 10,000 diesel buses in Beijing with very low emission Hythane® powered buses. These buses will burn Hythane®, a US patented mixture of hydrogen in natural gas, which Brehon acquired from Hydrogen Components Inc. in April 2004.

The Beiling Bus Project, which is anticipated to be the first in a series to be undertaken in many major cities in China, will dramatically reduce atmospheric pollution and greenhouse gas emissions in Beijing. It will be the world's first rollout of hydrogen as a vehicle fuel on a major scale.

The other parties to the MOU comprise the following:

China Association for Hydrogen Energy (CAHE);

China Electronic Engineering Design Institute (CEEDI);

Tsinghua University, a leading Chinese university; and,

Shougang Technology Research Institute (STRI).

DIRECTORS' REPORT (Cont'd)

STRI is part of the giant Shougang Group of companies that includes Capital Steel Company, a major Chinese steel manufacturer that produces 8 million tonnes of steel per year and has available as a by-product a large quantity of hydrogen. This hydrogen will be used in the blending of Hythane® for the Beijing Bus Project.

The first stage of the project will be a pilot project to develop and test 25 buses using a variety of encines and developing the necessary infrastructure for the entire project. Negotiations with the relevant parties to commence Stage 1 are well advanced and work on Stage 1 is expected to commence in the first half of 2005.

Upon successful completion of the Stage 1, which is expected to take approximately six months. the rest of the Project will be progressively undertaken on a timetable to be completed before the 2008 Olympic Games in Beijing, commencing with a second stage of 2000 buses.

The project has the preliminary approval of the Energy and Transportation Division of the Chinese Ministry of Science and Technology and will seek certification under the Clean Development Mechanism (CDM) of the Kyoto Protocol.

The project is expected to generate substantial tradeable carbon credits from the huge reduction in greenhouse gas emissions by replacing 10,000 diesel and natural gas buses with Hythane® buses operating seven days per week in Beiling. These carbon credits are anticipated to form a significant part of the funding package for the project under negotiation. During the negotiation period, the parties intend to finalize the full details of the project and execute a formal contract.

The Beijing Bus Project will represent the first major use of hydrogen as a vehicle fuel and heralds the start of the anticipated global transition to a hydrogen-based fuel economy. Furthermore, Brehon Far East has now commenced negotiations with several major parties in India for a similar project to introduce Hythane® into the Indian market.

Guangzhou Bus Project

Eden entered into a second MOU with the Guangzhou Motor Vehicle Emission and Notice Control Co-Operative Office in December 2004. The agreement is to establish a pilot project to test two different engines to operate on a combination of hydrogen and LPG for use in ten buses in Guangzhou. The parties propose to negotiate a contract within three months.

Further negotiations on the contract for the Beijing project and the establishment of a joint venture Chinese company are continuing.

Negotiations are underway with numerous other cities and provinces to convert bus fleets to operate on Hythane®, and since the end of the half year steps to commence the pilot project have commenced.

4.3. South Wales - Coal Bed Methane (CBM) and Abandoned Mine Methane (AMM)

South Wales Tenements

Eden has negotiated two farm in joint ventures with Coastal Oil and Gas Ltd and UK Methane Ltd in the UK to farm into:

• a 230km² petroleum exploration and development license (PEDL 100) over part of the South $\bullet$ Wales coalfields in respect of coal bed and coal mine methane to acquire a 50% interest. To earn its full 50% interset in PEDL 100 Eden must expend £500,000; and.
• Two new tenements were added to the South Wales Project in December 2004. PEDL 148 $\bullet$ and PEDL 149 have been granted and will form part of the project in which Eden is acquiring a 50% interest. These additional tenements are contiguous and immediately north of the existing PEDL 100.To earn its full 50% interest in PEDL 148 and PEDL 149 Eden must expend £500,000; and,

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DIRECTORS' REPORT (Cont'd)

a deeper oil/natural gas target which is located beneath PEDL 100, PEDL 148 and PEDL 149 to acquire a 50% interest (increasing to 60% if Eden expends more than £1M).

South Wales Exploration

During the quarter, a detailed due diligence and project review was completed by Eden's independent consultants. In summary, the consultant reports that:

• There is significant coal remaining in PEDL 100 to underpin a CBM project despite coal mining having been carried out for over 100 years;
• The coals in PEDL 100 are sufficiently thick, up 20m in some areas, and over a $\blacksquare$ significant portion of the permit are at an optimal CBM development depth range of 200m $-1000m$ :
• The coals of PEDL 100 range from bituminous in the south through to anthracite in the $\bullet$ north. The target for exploration will be the bituminous coals. Many economic CBM developments have occurred around the world in bituminous coals;
• Gas content determinations from individual locations in the southern portion of PEDL 100 confirm coal bed gas contents ranging from 5 $\text{m}^3$ /t to over 10 $\text{m}^3$ /t.
• The coal seams are reported to be interbedded with low permeability sand and siltstone $\bullet$ lithologies, which are ideal for CBM extraction with low water production;
• The significant number of abandoned coal mines in the region have also established a $\bullet$ further potential gas extraction opportunity from abandoned mine methane (AMM).

Future Exploration Programme

Eden will adopt the following process in assessing the CBM exploration potential of PEDL 100:

• Phase 1: Data review evaluating all appropriate coal and petroleum exploration holes/seismic and mining operations to generate drilling/assessment targets.
• Phase II: Target test drilling and sampling that will provide further data about gas contents; saturations; coal quality; permeability; reservoir properties; preliminary productivity.
• Phase III: Pilot testing of a successful target to assess well spacing; pattern; completion; response time; stimulation effectiveness; water trends; gas rates; history matching.
• Phase IV: Field development of a pilot gas producing operation.

A similar process will be followed for AMM but be focussed on historic mine workings. Economic development of the project will be dependent upon the recognition of high permeability, low stress structures. Further area specific data will also be required regarding gas content, sorption rate, saturation, reservoir pressures and distribution of historic underground mining workings.

The exploration process being considered by Eden will address the above and progress the CBM/AMM evaluation of PEDL 100 in a staged, risk-minimised, basis.

OPERATING RESULTS

The economic entity has reported a loss of \$394,674 for the period, after providing for nil income tax.

DIRECTORS' REPORT (Cont'd)

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

Significant change in the state of affairs of the economic entity during the period was as follows:

Tasman Resources NL

An increase in the paid up capital from \$7,604,166 to \$10,257,486 as a result of issue of the following shares during the period:

5,000,000 ordinary fully paid shares were issued at 7.5 cents per share as per applications to raise working capital.

6,100,000 ordinary fully paid shares were issued at 7.5 cents per share as per applications to raise working capital.

50,000 ordinary fully paid shares were issued at 8 cents per share as per applications to raise working capital. 5,010,000 ordinary fully paid shares were issued at 22 cents per share as per applications to raise working capital.

3,248,273 ordinary fully paid shares were issued at 22 cents per share as per applications to raise working capital.

A commission of 6% payable on funds raised by holders of Australian Financial Services licences was applicable to all of the above issues.

Eden Energy Ltd

An increase in the paid up capital to \$2,120,000 as a result of issue of the following shares during the period;

27 September 2004 1.200,000 ordinary fully paid shares were issued at 10 cents per share raising \$120,000 by private placement. 600,000 free options to acquire ordinary fully paid shares on or before the 30 September 2009 were issued on a one for two basis with the above shares.

26 November 2004 20,000,000 ordinary fully paid shares were issued at 10 cents per share raising \$2,000,000 by private placement. 10,000,000 free options to acquire ordinary fully paid shares on or before the 30 September 2009 were issued on a one for two basis with the above shares.

ENVIRONMENTAL ISSUES

The company is the subject of environmental regulation with respect to mining exploration and will comply fully with all requirements with respect to rehabilitation of exploration sites.

FUTURE DEVELOPMENTS

The Company proposes to continue with its exploration program.

This report is made in accordance with a resolution of the board of directors and is signed for and on behalf of the directors by:

Gregory Marguson

G H Solomon Director

Signed in Perth this $11^{17}$ day of March 2005

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DIRECTORS DECLARATION

The directors of the company declare that:

• $\ddagger$ the financial statements and notes, as set out on pages 10 to 15
• $(a)$ comply with Accounting Standards AASB 1029: Interim Financial Reporting and the Corporations Regulations; and
• $(b)$ give a true and fair view of the economic entity's financial position as at 31 December 2004 and of its performance for the half-year ended on that date;
• $2.$ in the director's opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors.

Grandy Doroman

G H Solomon Director

Signed in Perth this // day of March 2005

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STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2004

	Economic Entity
	31 December 2004 \$	30 June 2004 \$
CURRENT ASSETS
Cash Assets Receivables	3,179,898 70,020	451,940 32,831
TOTAL CURRENT ASSETS	3,249,918	484,771
NON CURRENT ASSETS
Property Plant & Equipment Exploration Expenditure at Cost Investments	25,608 5,163,516 893,141	26,277 4,737,611
TOTAL NON CURRENT ASSETS	6,082,265	4,763,888
TOTAL ASSETS	9,332,183	5,248,659
CURRENT LIABILITIES
Payables Provisions	112,196 11,550	147,161
TOTAL CURRENT LIABILITIES	123,746	147,161
NET ASSETS	9,208,437	5,101,498
EQUITY
Contributed Equity Accumulated Losses	9,281,275 (2,040,933)	6,755,888 (1,654,390)
Parent Entity Interest Outside Equity Interest	7,240,342 1,968,095	5,101,498
TOTAL EQUITY	9,208,437	5,101,498

The accompanying notes form part of this financial report.

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STATEMENT OF FINANCIAL PERFORMANCE FOR THE HALF YEAR ENDED 31 DECEMBER 2004

	31 DECEMBER 2004 \$	31 DECEMBER 2003 \$
CLASSIFICATION OF EXPENSES BY FUNCTION
Other revenues from ordinary activities
Interest Revenue	19,067	12,248
Administration expenses Depreciation expense Exploration Expenditure written off	(360, 220) (3,409) (56, 635)	(294, 606) (10, 745)
Loss from ordinary activities before income tax expense Income tax (expense) / benefit	(401, 197)	(293, 103)
Net loss from ordinary activities after income tax expense	(401, 197)	(293, 103)
Net loss (profit) attributable to outside equity interests	6,523
Net loss attributable to members of the parent entity	(394, 674)	(293, 103)
Total revenues, expenses and valuation adjustments attributable to members of the parent entity recognized directly in equity	(394, 674)	(293, 103)
Total changes in equity other than those resulting from transactions with owners as owners	(394, 674)	(293, 103)
Basic Earnings per share (cents per share)	(0.525)	(0.523)
Diluted earnings per share (cents per share)

Economic Entity

As at 31 December 2004 the company had 43,795,417 options on issue exercisable at 20 cents. These options are not considered to be potential ordinary shares for the calculation of dilutive earnings per share. Dilutive earnings per share has not been disclosed as its calculation does not show an inferior view of the earnings performance to that shown by the basic earnings per share.

The accompanying notes form part of this financial report.

STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

	Economic Entity
	31 DECEMBER 2004 S	31 DECEMBER 2003 S
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers Interest received Goods and Services Tax Paid	(326, 691) 19,067 (55, 117)	(279, 828) 12,248 (25,050)
Net cash used in operating activities	(362, 741)	(292, 630)
CASH FLOWS FROM INVESTING ACTIVITIES
Exploration expenditure Purchase of Plant & Equipment Equity Investments	(523,078) (2,441) (884,169)	(845, 868) (5,970)
Net cash used in investing activities	(1,409,688)	(851, 838)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares Costs of Share Issues	4,773,320 (272, 933)	2,058,380 (101, 414)
Net cash provided by financing activities	4,500,387	1,956,966
Net increase (decrease) in cash held Cash at 1 July 2004	2,727,958 451,940	812,498 287,827
Cash at 31 December 2004	3,179,898	1,100,325

The accompanying notes form part of this financial report.

NOTES TO THE FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

$\ddagger$ . Basis Of Preparation

The half-year consolidated financial statements are a general purpose financial report prepared in accordance with the requirements of Corporations Act 2001, Accounting Standard AASB 1029: Interim Financial Reporting, Urgent Issues Group Consensus Views and other authoritative pronouncements of the Australian Accounting Standards Board.

It is recommended that this financial report be read in conjunction with the annual financial report for the year ended 30 June 2004 and any public announcements made by Tasman Resources NL and its controlled entity during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act $2001.$

The accounting policies have been consistently applied by the entities in the economic entity and are consistent with those applied in the 30 June 2004 annual report.

The half-year report does not include full disclosures of the type normally included in an annual financial report.

$2.$ Loss from Ordinary Activities

	Economic Entity
	31 DECEMBER	31 DECEMBER
	2004	2003
The following revenue and expense items are relevant in explaining the financial performance for the interim period
Write-off of capitalised exploration expenditure on areas of
interest abandoned during the period	56,635

$3.$ Commitments

Exploration Commitments

The company has certain obligations to perform minimum exploration work and to expend minimum amounts of money on such work on mining tenements. These obligations may be varied from time to time subject to approval and are expected to be fulfilled in the normal course of the operations of the company subject to the company being able to raise sufficient additional capital. The total annual commitments on the existing tenements is \$1,300,000. These commitments have not been provided for in the accounts. In part these commitments can be satisfied by time spent by officers of the company on activities related to the exploration tenements.

Brehon Energy plc

In June 2004 Eden undertook a commitment of up to US\$1,000,000 to acquire up to a 20% interest in Brehon Energy plc and 49% interest in Brehon Far East Pty Ltd. At reporting date US\$540,000 had been paid and there was a balance payable of approximately US\$460,000 of which approximately US\$128,000 has been paid since 31 December 2004.

South Wales

Eden has negotiated two farm in joint ventures with Coastal Oil and Gas Ltd and UK Methane Ltd in the UK to farm into:

a 230km² petroleum exploration and development license (PEDL 100) over part of the South Wales $\bullet$ coalfields in respect of coal bed and coal mine methane to acquire a 50% interest. To earn its full 50% interset in PEDL 100 Eden must expend £500,000; and,

NOTES TO THE FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

$3.$ Commitments (Cont'd)

• Two new tenements were added to the South Wales Project in December 2004. PEDL 148 and PEDL 149 have been granted and will form part of the project in which Eden is acquiring a 50% interest. These additional tenements are contiguous and immediately north of the existing PEDL 100. To earn its full 50% interset in PEDL 148 and PEDL 149 Eden must expend £500,000; and,

• a deeper oil/natural gas target which is located beneath PEDL 100, PEDL 148 and PEDL 149 to acquire a 50% interest (increasing to 60% if Eden expends more than £1M).

These commitments have not been provided for in the accounts.

4. Events Subsequent To Reporting Date

On 13 January 2005 a total of 6,000,000 options were issued at no cost in Eden Energy Ltd to the directors of Eden Energy Ltd as approved at meetings of members of both Tasman Resources NL and Eden Energy Ltd.

On 1 March 2005 it was agreed to issue 1,500,000 options in Eden Energy Ltd at no cost to a consultant for the ongoing provision of consultancy services in respect of Brehon Far East Pty Ltd and Chinese investors.

On 4 March 2005 a total of 600,000 options were issued to employees of Tasman Resources NL pursuant to terms and conditions of the Employees Share and Option Plan.

Apart from the abovementioned items, there are no other matters or circumstance that have arisen since the end of the half year which significantly affected or may significantly affect the operations of the economic entity, the results of those operations, or the state of affairs of the economic entity in subsequent financial years.

5. Segment Information

$\left(\mathbb{I}\right)$ Geographical

The economic entity operates predominately in Australia.

$(ii)$ Business

The economic entity operated predominately in the area of mineral exploration, gas and investments.

6. Contingent Liabilities

There has been no change in contingent liabilities since the last annual reporting date.

7. International Financial Reporting Standards

Australia is currently preparing for the introduction of International Financial Reporting Standards (IFRS) as issued by the Australian Accounting Standards Board, effective for financial years commencing 1st January 2005.

The economic entity's management, along with its auditors, are assessing the significance of these changes and preparing for their implementation. Appropriate processes have been set in place to oversee and manage this transition to IFRS.

NOTES TO THE FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

$\overline{7}$ . International Financial Reporting Standards (Cont'd)

The directors' are of the opinion that the key differences in accounting policies that would arise from the adoption of the IFRS standards (based on standards issued to date and pending standards) are as summarised below. This summary should not be taken as an exhaustive list of all differences in accounting policies and does not include disclosure, presentation and classification differences that would affect the manner in which transactions or events are presented.

The economic entity has not quantified the potential impact of the differences discussed below. The key potential implications of the conversion to IFRS on the company/economic entity are as follows

Intangible Assets -

Intangible assets can only be revalued if there is an active market for them. Intangible assets, which have indefinite lives will not be amortised but will be tested for impairment annually.

Impairment of Assets - Assets which have infinite lives and are not amortised should be subjected to annual impairment tests. All other assets would be subject to impairment tests only when there are indications of impairment. The recoverable amount of an asset is the higher of the net selling price in an active market and its value in use. Value in use is the net present value of the future cash flows that the asset can generate.

Income Tax - Income tax will be calculated on the "balance sheet" approach under which temporary differences are identified for each asset and liability. As tax effects follow the underlying transaction, some tax effects will be recognised in equity.

Effects of Changes in Foreign Exchange Rates - The financial statements of economic entity may be reported in more than one currency. The economic entity's integrated foreign operations can no longer be translated using the temporal method.

AASB 6 requires Australian entities to apply "area of interest" accounting to their exploration and evaluation expenditures. Generally this will enable exploration and evaluation expenditures to be treated in the same manner as they were under AASB 1022, subject to any impairment testing requirements. The primary difference between this Standard and the AASB Standard that it supersedes, AASB 1022 Accounting for the Extractive Industries, is that the scope of this Standard is restricted to the treatment of exploration and evaluation expenditures. The other phases of extractive activity operations are covered under other Australian equivalents of International Financial Reporting Standards. The full impact of these Standards are yet to be determined.

We will seek to keep the stakeholders advised as to the impact of these changes as they are studied and finalised.

8. Comparative Figures

Where required by Accounting Standards comparative figures have been adjusted to conform with changes in presentation for the current financial year.

INDEPENDENT REVIEW REPORT TO THE MEMBERS OF TASMAN RESOURCES NL

SCOPE

The financial report and directors' responsibility

The financial report comprises the statement of financial position, statement of financial performance, statement of cash flows, accompanying notes to the financial statements, and the directors' declaration for Tasman Resources NL (the company) and the consolidated entity, for the half-year ended 31 December 2004. The consolidated entity comprises both the company and the entities it controlled during that half-year.

The directors of the company are responsible for preparing a financial report that gives a true and fair view of the financial position and performance of the company and the consolidated entity, and that complies with Accounting Standard AASB 1029 "Interim Financial Reporting", in accordance with the Corporations Act 2001. This includes responsibility for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial report.

Review approach

We conducted an independent review of the financial report in order to make a statement about it to the members of the company, and in order for the company to lodge the financial report with the Australian Stock Exchange and the Australian Securities and Investments Commission.

Our review was conducted in accordance with Australian Auditing Standards applicable to review engagements, in order to state whether, on the basis of the procedures described, anything has come to our attention that would indicate that the financial report is not presented fairly in accordance with the Corporations Act 2001, Accounting Standard AASB 1029 "Interim Financial Reporting" and other mandatory professional reporting requirements in Australia, so as to present a view which is consistent with our understanding of the company's and the consolidated entity's financial position, and of their performance as represented by the results of their operations and cash flows.

A review is limited primarily to inquiries of company personnel and analytical procedures applied to the financial data. These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance is less than given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

INDEPENDENCE

We are independent of the company, and have met the independence requirements of Australian professional ethical pronouncements and the Corporations Act 2001.

Head Office na laval BonkWest Tower 108 St George's Terrace Perth 6000 Western Australia

GPO Box W2106
PERTH WA 6846

Telephone:(08) 9320 2888
Facsimile: (08) 9320 2999

Kalgoorlie Office
Suite 1, 47 Brookman Street Kalgoonile 6430
Western Australia

Telephone:(08) 9021 7066

Bunbury Office Suite 1, 9A Wittenoorn Street
Bunbury 6230
Western Australia

Telephone: (08) 9791 6466

Busselton Office Suite 2
58 Bussell Highway Busselton 6280 Western Australia

Telephone:(08) 9751 3895

Email: hcperinfo@hall chadwick.com.au www.hallchadwick.com.au

Other firms in: Sydney
Melbourne meroom
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Hall Chadwick Perth Services

• · Assurance and Risk Management
• · Corporate Taxation
• · Business Valuation and Expert's Reports
• · Corporate Reance
• · Strategic Planning
• · Business and Corporate Restructuring
• Corporate and Personal
  Insolvency
• · Financial Investigations
• · Non-Statutory Arrangements with
  Creditors

National Association Holl Chadwick

International Association AGN International

Associations of Independent Firms

REVIEW STATEMENT

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the financial report of Tasman Resources NL is not in accordance with:

(a) the Corporations Act 2001, including:

• giving a true and fair view of the financial position of Tasman Resources NL $(i)$ and the consolidated entity at 31 December 2004 and of their performance for the half-year ended on that date; and
• complying with Accounting Standard AASB 1029 "Interim Financial $(ii)$ Reporting" and the Corporations Regulations 2001; and

(b) other mandatory financial reporting requirements in Australia.

INHERENT UNCERTAINTY REGARDING RECOVERABILITY OF ASSETS

Without qualification in the statement noted above, attention is drawn to the following matters:

The carrying value of mining tenements and exploration expenditure of \$5,163,516 and investments of \$893,141 is dependent upon the successful commercial exploitation and/or sale of the consolidated entity's interest therein at amounts at least equal to book value.

Hall Chadrick

HALL CHADWICK Chartered Accountants

MAURICE L ANGHIE Partner

DATED at PERTH this / day of March 2005

KC Hall Chadwick Chartered Accountants & Business Advisers

Head Office Level 40
BonkWest Tower 108 St George's Terrace
Perth 6000 Western Australia

GPO Box W2106 PERTH WA 6846

Telephone: (08) 9320 2888
Facsimile: (08) 9320 2999

Kalgoorlie Office
Suite 1, 47 Brookman Street
Kalgoorlie 6430 Western Australia

Telephone: (08) 9021 7066

Bunbury Office Suite 1, 9A Wittenoom Street
Bunbury 6230
Western Australia

Telephone: (08) 9791 6466

Busselton Office Suite 2
58 Bussell Highway Bussellon 6280
Western Australia

Telephone: (08) 9751 3895

Email: hoperinfo@hall chadwick.com.au www.hallchadwick.com.au

Other firms in: Sydney
Melbourne Adelaide Brishane

Holl Chadwick Penh Services

• · Assurance and Risk Monagement
• · Corporate Taxation
• · Business Valuation and Expert's Reports
• · Corporate Finance · Strategic Planning
• · Business and Corporate Restructuring $\bullet$ Corporate and Personal
  Insolvency
• · Financial Investigations
• Non-Srosutory

Arrongements with
Creditors

National Association Boll Chadwick

International Association AGN International

Associations of Independent Firms

$15^{th}$ March 2005

The Board of Directors Tasman Resources NL P O Box Z5360 St George' sTerrace PERTH WA 6831

Dear Board Members.

TASMAN RESOURCES NL

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Tasman Resources NL.

As lead audit partner for the review of the financial statements of Tasman Resources NL for the half-year ended 31 December 2004, I declare that to the best of my knowledge and belief, there have been no contraventions of:

• $(i)$ the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
• $(ii)$ any applicable code of professional conduct in relation to the review.

Yours sincerely,

Hall Chadrile

HALL CHADWICK CHARTERED ACCOUNTANTS

MAURICE L ANGHIE PARTNER