TITANIUM SANDS LIMITED — Capital/Financing Update 2007

May 28, 2007

ABN 65 009 131 533

29 May 2007

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

Dear Sir / Madam

WINDIMURRA GAS SUPPLY SECURED

The board is pleased to announce that the Company's 90% subsidiary, Windimurra Vanadium Pty Ltd, has entered into three agreements for the purchase and delivery of natural gas to the world class Windimurra vanadium mine, under development 650km north east of Perth.

An agreement for the purchase of natural gas has been signed with an off-shore WA gas producer. The supply agreement is worth approximately \$35m over the initial term of 3 years with Windimurra having an option to extend for a further 3 years.

A Part Haul Standard Shipper Contract for the transmission of gas on the Dampier to Bunbury Natural Gas Pipeline ("DBNGP") from the inlet on the DBNGP that receives gas from the gas field to the MidWest Gas Pipeline offtake on the DBNGP has been signed with the pipeline operator, DBNGP (WA) Transmission Pty Ltd. The contract for a term of 15 years secures Windimurra's place in the Stage 5A expansion of DBNGP due for completion in March 2008.

A Gas Transportation Agreement has also been reached with Horizon Power and APT Pipelines (WA) Pty Ltd for the transmission of gas from the DBNGP to the Windimurra Vanadium mine, via the Mid West Pipeline, for a term of 15 years. This 365km gas pipeline was originally built to facilitate development of Windimurra in 1999.

The gas will be used to fire the existing 126m rotary kiln at Windimurra, and to power the 18.5MW gas turbine power station. The first three of four gas turbines being built for the Company by Solar Turbines of USA, will leave the factory next month.

Gas is an essential fuel for the Windimurra vanadium mine, and its use is unique in the vanadium industry. Roasting the ore concentrate with natural gas has previously been shown at Windimurra to yield a higher purity vanadium product than is produced by competitors who use pulverised coal. Gas also represents the largest single operating cost and the execution of these contracts therefore represents a significant milestone as Windimurra moves from the detailed design to the construction and operational stage.

Yours sincerely

PRECIOUS METALS AUSTRALIA LIMITED

DRIAIN SCOTT DIRECTOR

Level 4, 76 Kings Park Road West Perth Western Australia 6005 PO Box 620 West Perth Western Australia 6872 Telephone: +61 8 9423 1900 Facsimile: +61 8 9423 1999