QUARTERLY REPORT. Third Quarter Activities & Cashflow Report for the period ended 31 March 2004

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1 ASHBURTON MINERALS LTD Suite 3, 2 Richardson Street, West Perth WA 6005 PO Box 517, West Perth WA 6872 Tel: ; Fax: ; QUARTERLY REPORT Third Quarter Activities & Cashflow Report for the period ended 31 March 2004 Significant Events during Quarter: HIGHLIGHTS Wirralie Feasibility Study reports an increase in total resources by 21% to 532,000 oz; Study temporarily suspended in favour of additional resource drilling. Wirralie low grade oxide resource extension drilling programme completed, with 53 of 65 holes drilled returning ore grade intercepts; total of 3,181 metres drilled; best intercepts g/t, g/t, g/t, 2.91 g/t, 1.11 g/t. Straits Resources Ltd enters into Option and Joint Venture Agreement over the Company s Yandan project in the Drummond Basin, Qld. Entitlements Option Prospectus issued, offering one 2-cent option for every six fully paid shares held; options exercisable at 32c each, expiring on 31 March 2007, and to be listed on ASX. Conversion of options: 2,268, cent options, expiring 30 June 2006, were converted into fully paid ordinary shares, raising $272,196. Additional EL application lodged in East Kimberley region of WA. Share price at start of quarter (2/01/04): 32.5 c; price at end of quarter (31/03/04): 24.0 c. Significant Events Subsequent to Quarter end: Entitlements Option Prospectus closed, raising $242,648; 12,132,422 two-cent options quoted on ASX under code ATNO; opening trade on at 5.0c. Three new EL applications lodged in the Ashburton region of WA.

2 REVIEW OF OPERATIONS 1. CORPORATE During the Third (March) quarter $314,000 was raised through the exercise of options. A further $242,648 was raised subsequent to quarter end via a prospectus issue of new options (Entitlements Options). The strong support that the Company has attracted in Europe continued to grow during the Quarter. Some 40% of the Company s shares are currently held by European-based investors. The Company s share price moved from 32.5 c at the beginning of the quarter on 2 January 2004, to close the Quarter at 24.0 cents, reflecting the continuing fall in the gold price during the period. At lodgement of this report, on 30 April 2004, the gold price remained relatively low at US$ Entitlements Option Issue On 9 March 2004, the Company issued an Entitlements Option Prospectus, being a pro-rata non-renounceable rights issue of up to 12,132,422 options, on the basis of one two-cent option for every six fully paid shares held, at an exercise price of 32 cents each by 31 March A total of 558 shareholders participated in the issue, with primary applications totalling 4,816,897 options. The shortfall of 7,315,525 options was oversubscribed and was allocated by Directors to participating applicants on a pro-rata basis. The full entitlement of 12,132,422 options was thus issued. Quotation of the options on the ASX was sought and granted, and trading opened at 5.0 cents on 30 April Exercise of Loyalty options An additional 2,268,301 Loyalty options were exercised at 12 cents each and converted to fully paid ordinary shares, raising $272, in general working capital. A further 2,659, cent Loyalty options, with an exercise date of 30 June 2006, remain unexercised. 1.3 New Company Secretary Following the resignation of Mr Ross Greg Ledger from the position, Mr Tom Melanko was appointed Company Secretary on 2 March Mr Melanko is a Certified Practicing Accountant with over 12 years commercial accounting experience and has previous experience as a company secretary with companies involved in mineral exploration and in information technology. 1.4 Option and JV Agreement with Straits Resources Ltd (ASX: SRL) On 4 March 2004, the Company announced that its subsidiary company, Wirralie Mines Pty Ltd ( WMPL ), signed an agreement with Straits Exploration (Australia) Pty Ltd, a wholly owned subsidiary of Straits Resources Limited ( Straits ), over the Company s Yandan tenements in the western Drummond Basin in Queensland. The Yandan tenements encompass some 500 km 2 of prospective Drummond basin stratigraphy and include the Yandan Gold Mine, from which Ross Mining NL recovered 365,000 oz through a combination of CIP and dump leach operations from 1992 to Under the terms of the Agreement, Straits has a six month option period to determine whether or not to proceed to the farm-in stage, through which Straits can earn 70% in the

3 tenements by expending $2 million over a four year period, with a minimum of $150,000 per annum, subsequent to which exploration would be on a joint venture basis. This is an excellent achievement for the Company. The Yandan tenements are situated 50 to 80 km southwest of the Company s Wirralie project where work is underway into a feasibility study at recommencing gold mining operations on remaining oxide resources utilising the existing 1.5 Mtpa treatment plant and infrastructure. Straits involvement will enable the company to concentrate is exploration efforts on prospects within closer trucking distance to the Wirralie plant, while ensuring active exploration of the very prospective Yandan tenements. 2. WIRRALIE FEASIBILITY STUDY Initial results from the Wirralie Feasibility Study were received during the Quarter. The main outcome of investigations to date has been the confirmation that the low grade Wirralie oxide resource remains open and therefore not fully quantified. It was consequently decided to put the study on hold while further resource drilling was undertaken to define the extent of economic oxide gold mineralisation. The results of this work are summarised below. Additional findings included the confirmation of refurbishment costs for the 1.5 Mtpa CIP/CIL treatment plant at around $1.9 million. A negative finding is that the bore field will require augmentation from its current supply rate of 35 L/s to around 50L/s in order to provide sufficient process water for the envisaged 1.5 Mtpa throughput rate. However, subsequent to this monitoring work the Drummond region experienced extensive flooding and follow up monitoring is required to determine the level of recharge of the aquifer system. Consulting independent geologists, Hellman & Schofield ( H&S ) completed an initial resource recalculation for the Wirralie deposit, showing an overall increase in total resources by 21% to 532,000 oz of contained gold, consisting of 132,000 oz of oxide resources (down by 8%), and 400,000 oz of sulphide resources (up by 35%). These results are summarised in the appended Table 1. The decrease in the oxide resources stems from an erroneous inclusion in a previous resource estimate of a component of mined material, an error stemming from the use of an incorrect, non-final excavated surface. 2.1 Wirralie Oxide Resource Drilling The initial programme of resource drilling across the Wirralie low grade oxide resource has been completed, comprising a total of 65 holes for 3,181 metres of RC drilling. The primary aim of this programme was to provide information from areas lacking sufficient drill density to enable inclusion within a JORC-compliant resource estimate. The programme was very successful, with 53 of the 65 holes drilled returning ore grade intercepts. A full listing of significant results is tabulated below. This work has extended the Wirralie oxide resource a further 75 metres to the west. The details of the increase in the resource will be released once the oxide resource has been recalculated by H&S.

4 Wirralie oxide resource drilling, April 2004: Significant Intercepts 1 Hole No. 2 Easting 3 Northing 3 Depth From (m) Width (m) Au Grade (g/t) WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC to EOH WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC WWC

5 WWC WWC WWC WWC WWC WWC WWC WWC Note 1: Significant intersections are determined using a 0.5 g/t lower cut, 2m minimum width, and 2 m maximum internal dilution. Note 2: All holes drilled at -60 o to local grid south. Note 3: Local grid co-ordinates. 3. EXPLORATION Field work was delayed throughout due to a longer than expected wet season, affecting the Ashburton and East Kimberley campaigns in particular. Field work will commence in the Ashburton region in a week s time following which the crews will move to the East Kimberley. 3.1 Drummond Basin, Qld Evaluation of various prospects within this vast project area is continuing. Work included a compilation of a seamless digital geological map database. Evaluation work commenced over the Police Creek prospect where previous internal resource estimates (possibly non- JORC compliant) by Newmont cite an estimated g/t for a contained 80,000 of gold. Current work will be aimed at confirming the existence a near surface oxide component to this resource that may represent satellite feed to the Wirralie treatment plant. 3.2 East Kimberley, WA (Figure attached) Digital capture of available open file historical data is continuing. Quotes for airborne geophysical surveys have been obtained, with this work possibly scheduled for acquisition in June An additional exploration licence, E80/3318, termed the Amherst Project, was applied for in the East Kimberley region. The application consists of 70 sub-blocks and is some 220 km 2 in size. The Amherst tenement encompasses a number of historical workings that record gold, copper, silver and lead mineralisation. The tenement is situated in the Mt Amherst area, some 75 km SW of Halls Creek, and contains a broad, poorly mapped sequence of undifferentiated Lower Proterozoic schists, amphibolites and dolerites along the northern edge of the Halls Creek Mobile Zone (see appended figure). The Company views the east Kimberley as an under-explored province that is demonstrably highly prospective for a range of commodities. The Amherst tenement enhances the Company s portfolio and increases the likelihood of a significant economic discovery. 3.3 Ashburton, WA (Figure attached) Three new exploration licences have been applied for in the Ashburton region. Using the benefits of its existing 60,000-plus assay geochemical database, the Company has been

6 able to identify these areas as being very prospective for gold mineralisation. The three applications are located in various parts of the Ashburton region, as shown in the attached map. TOM DUKOVCIC Managing Director 30 April 2004 NOTE: The information contained in this report insofar as it relates to exploration results, Mineral Resources or Ore Reserves is based on information compiled by Mr Tom Dukovcic who is a Member of the Australian Institute of Geoscientists and who has sufficient relevant experience to qualify as a Competent Person as defined in the 1999 Edition of the Australasian Code for Reporting of Mineral Resources and Ore Reserves. This report accurately reflects the information compiled by Mr Dukovcic.

7 Table 1. Wirralie Gold Mine Resource Summary (showing comparison of Hellman & Schofield (2004) results with RSG Global (2003) results, as reported in the Company s prospectus of July 2003) Cutoff Measured grade Au g/t M t Grade Au g/t M t Indicated Inferred Total Grade Au g/t M t Grade Au g/t M t Grade Au g/t Ounces Oxide (H&S) ,000 Oxide (RSGG) ,000 Sulphide (H&S) not calc. not calc. not calc. not calc ,000 Sulphide (RSGG) ,000 TOTAL (H&S) ,000 1 Major reason for discrepancy between H&S and RSGG resource is the use by RSGG of incorrect (non-final) excavated surface, thus including a component of mined oxide material in their estimate. 2 H&S sulphide resource reported only as a total resource in the Inferred category.

8 me me Copericus (Ni) mn mn Sally Malay (Ni) Panton Sill (PGM) Halls Creek Amherst Tenement Koongie Park (VMS Cu-Pb-Zn-Ag-Au) mn mn Nicolson's Find (Au) Dockerell (Au) me me ASHBURTON MINERALS LTD Map Location Kimberley Project Regional Aeromagnetics and Tenement Location Date: 30/04/04 Projection: GDA 94 Scale: 1:1,000,000

9 me me Red Hill mn Paulsons mn mn Soldiers Secret mn Top Camp me me Map Location New Tenement Applications ASHBURTON MINERALS LTD Ashburton Project Regional Aeromagnetics and Tenement Location Date: 30/04/04 Projection: GDA 94 Scale: 1:1,000,000

10 Appendix 5B Mining exploration entity quarterly report Appendix 5B Rule 5.3 Mining exploration entity quarterly report Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98. Name of entity Ashburton Minerals Ltd ACN or ARBN Quarter ended ( current quarter ) March 2004 Consolidated statement of cash flows Cash flows related to operating activities Current quarter $A 000 Year to date (9 months) $A Receipts from product sales and related debtors 1.2 Payments for (a) exploration and evaluation (b) development (c) production (d) administration (147) (449) (357) (973) (58) (309) 1.3 Dividends received 1.4 Interest and other items of a similar nature received Interest and other costs of finance paid - (8) 1.6 Income taxes paid 1.7 Other (provide details if material) Net Operating Cash Flows (612) (1,572) Cash flows related to investing activities 1.8 Payment for purchases of: (a)prospects (b)equity investments (c) other fixed assets (18) 1.9 Proceeds from sale of: (a)prospects (b)equity investments (c)other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) (5) (35) Net investing cash flows (18) (40) 1.13 Total operating and investing cash flows (carried forward) (630) (1,612) + See chapter 19 for defined terms. 1/7/98* Appendix 5B Page 1

11 Appendix 5B Mining exploration entity quarterly report 1.13 Total operating and investing cash flows (brought forward) (630) (1,612) Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc , Proceeds from sale of forfeited shares Proceeds from borrowings Repayment of borrowings - (100) 1.18 Dividends paid 1.19 Other - Cost of capital raising (77) (230) Net financing cash flows 237 5,448 Net increase (decrease) in cash held (393) 3, Cash at beginning of quarter/year to date 4, Exchange rate adjustments to item Cash at end of quarter 3,974 3,974 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' Aggregate amount of payments to the parties included in item Aggregate amount of loans to the parties included in item Explanation necessary for an understanding of the transactions 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 Financing facilities available + See chapter 19 for defined terms. Appendix 5B Page 2 1/7/98*

12 Appendix 5B Mining exploration entity quarterly report Add notes as necessary for an understanding of the position. 3.1 Loan facilities Amount available $A 000 Amount used $A Credit standby arrangements Estimated cash outflows for next quarter $A Exploration and evaluation Development 150 Total 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 Previous quarter $A Cash on hand and at bank Deposits at call 3,825 4, Bank overdraft 5.4 Other (provide details) Total: cash at end of quarter (item 1.22) 3,974 4,367 Changes in interests in mining tenements 6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased Tenement reference E80/2897 E80/2905 E80/2906 Nature of interest (note (2)) Title Granted Title Granted Title Granted Interest at beginning of quarter 0% 0% 0% Interest at end of quarter 50% 50% 50% + See chapter 19 for defined terms. 1/7/98* Appendix 5B Page 3

13 Appendix 5B Mining exploration entity quarterly report 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. 7.1 Preference + securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs, redemptions Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted 7.7 Options (description and conversion factor) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter 7.11 Debentures (totals only) 7.12 Unsecured notes (totals only) Total number Number quoted Issue price per security (see note 3) (cents) 69,201,646 69,201,646 2,268,301 2,268, ,336 (ATNAI) Employee Option Incentive Scheme 2,659,550 Loyalty Option Scheme 2,268,301 2,268,301 N/A Exercise price Various 12 cents Amount paid up per security (see note 3) (cents) Expiry date 31 December June See chapter 19 for defined terms. Appendix 5B Page 4 1/7/98*

14 Appendix 5B Mining exploration entity quarterly report Compliance statement 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Law or other standards acceptable to ASX (see note 4). 2 This statement does /does not* (delete one) give a true and fair view of the matters disclosed. Sign... Date: 28 April 2004 Company Secretary here: Print name:...tom Melanko... Notes 1 The quarterly report provides a basis for informing the market how the entity s 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. 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 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. == == == == == + See chapter 19 for defined terms. 1/7/98* Appendix 5B Page 5