TITANIUM SANDS LIMITED — Capital/Financing Update 2006

Jul 30, 2006

31 July 2006

Company Announcements Office Australian Stock Exchange Limited Exchange Plaza Sherwood Court PERTH WA 6000

Milestone Vanadium Off take Agreement and \$22m Finance Package

Precious Metals Australia Ltd (PMA) is pleased to announce the conclusion of a comprehensive Vanadium Sales and Marketing Agreement and an Equity Investment Agreement with a subsidiary of leading global supply chain manager, Noble Group Limited.

This strategic alliance between PMA and Noble will ensure that the Windimurra project in Western Australia is a highly competitive, long life world-class mine, producing high quality vanadium at a sustainable cost.

Vanadium Sales and Marketing Agreement

Noble Resources Limited ("Noble") has agreed to purchase the total vanadium output of the Windimurra mine, at prevailing market prices.

During the first seven years of production, Noble will pay a minimum price for vanadium equal to the cash cost of producing vanadium at Windimurra based on the forecast production schedule.

In consideration for Noble Resources entering into the Vanadium Sales and Marketing Agreement and agreeing to pay the minimum price for vanadium. PMA has agreed to pay Noble a once-off fee of A\$10m satisfied by the issue to Noble of 3,728,549 fully paid ordinary shares in PMA equal to 4.99% of the shares outstanding, subject to PMA shareholder approval.

Noble will exclusively market and handle all distribution logistics for Windimurra vanadium worldwide through its international network of offices and will be paid a fee at commercial rates for this service. Noble's marketing

effort will be complemented by PMA's own marketing team which will focus on servicing end user's requirements, new high-value product development and promoting Windimurra vanadium as the product of choice.

Level 4, 76 Kings Park Road West Perth Western Australia 6005

PO Box 620 West Perth Western Australia 6872

Telephone: +61 8 94231900
Facsimile: +61 8 94231999

http://www.pmal.com.au

The Agreement is subject to PMA board approval for development of the Windimurra Project and entry into financing arrangements for the Project.

Equity Investment Agreement

Noble has agreed to subscribe to an unlisted, unsecured convertible note on the following terms:

• $\bullet$ face value of A\$8,202,207;
• term of 3 years (from when funds are drawn);
• early repayment is permitted: $\bullet$
• convertible into 3.728.548 fully paid ordinary PMA shares, equivalent to $\bullet$ an issue price of A\$2.20 per share:
• interest at LIBOR plus 2%: $\bullet$
• other standard terms. $\Delta$

PMA's ability to call for payment of the face value of the note is subject to completion of due diligence by Noble within 60 days, and approval of PMA shareholders.

Additionally, PMA's wholly-owned subsidiary, PMA (Windimurra) Pty Ltd, the owner of the Windimurra Project, has granted to Noble a 60 day option to subscribe for 9.999% of the issued share capital of PMA (Windimurra) Pty Ltd for A\$13.5 million, subject to Noble and PMA entering into a shareholders agreement.

Upon exercising the option and issuing the convertible note, Noble will be entitled to nominate 2 directors to the PMA board.

PMA executives have met with a large number of vanadium users world wide who have indicated strong interest in securing reliable vanadium supply, of higher quality and more competitive cost than has been available in recent years. PMA chose an alliance with Noble due its financial strength, strong reputation, market penetration in the growing Chinese market, and past success in partnering Australian mines.

We look forward to working closely together in serving the vanadium industry and in maximising returns to shareholders.

Yours sincerely PRECIOUS METALS AUSTRALIA LIMITED

RODERICK SMITH Managing Director

For further details please contact:

Ms. Louisa Tam Noble Group Limited Tel: +852 2861 3511 Fax: +852 2527 0282 Email: noble@thisisnoble.com

Mr Roderick Smith Chief Executive Officer Precious Metals Australia Limited Tel +61 8 94231900 Fax: +61 8 94231999 Email: info@pmal.com.au

Editor's Note Regarding Noble Group Limited

Noble Group Limited (SGX: NOBL) is a market leader in managing the global supply chain of agricultural, industrial and energy products. Achieving the second highest profitability in 2005 with net profits of US\$231 million representing a 36% ROE on US\$11.7 billion in revenue, the Group operates a network of over 70 offices in 42 countries serving more than 3500 customers.

In 2005, Noble Group was assigned ratings from Moody's Investors Service and Standard & Poor's Ratings Agency and joined the benchmark Straits Times Index, MSCI Index in Singapore and the FTSE - Hang Seng Index. During this period, the Group was recognized as one of BusinessWeek's Stars of Asia and FinanceAsia's Best Companies, a leader in Corporate Governance by The Asset and a Best Employer by Hewitt Associates. Noble also topped The Forbes Global 2000 - Total Return over the last five years.

In 2004, Noble Group's Board of Directors was awarded the Listed Companies (Main Board) Boards Award from The Hong Kong Institute of Directors and ranked first on the Billion-dollar club of the Singapore Stock Exchange for Total Shareholder Returns over a 3 and 5 year period.

Editor's Note Regarding the Windimurra Vanadium Mine

The Windimurra Vanadium Project, located 600km north east of Perth, Western Australia, is based on the largest reported vanadium Proven Ore Reserve in the world. The Windimurra mine was originally built by PMA and its partner in 1999/2000 at a total cost including infrastructure of over \$270m and whilst operating, was the world's largest primary vanadium mine, producing some 10% of world production. The mine produced over 30m lbs of vanadium pentoxide which was sold to consumers throughout the world. Windimurra product was recognised as the highest purity produced by any mine.

The mine closed in early 2003, and was partly decommissioned in 2004 in controversial circumstances. PMA regained full ownership of the mine, remaining plant and equipment, intellectual property and designs and records in August 2005.

Since 2003 world demand for vanadium and the price of the commodity have increased strongly, largely driven by growth in Chinese steel production. PMA will re-build and reopen the Windimurra Mine by end 2007 at an increased level of production and including conversion to ferrovanadium. The mine will produce 5,000,000kg of contained vanadium, anticipated to meet approximately 8% of the world's growing demand.