Australia's Straits Resources reports C. Kalimantan gold project progress

The following is an exceprt from Australian mining firm Straits Resources Limited quarterly report posted on July 21,2004.

(Mt Muro Gold Project, Straits - Contract of Work 70%)

Drilling has continued through the quarter concentrating on the Juking Sopan and Tumbang Lahung areas. A total resource of 109,000 gold equivalent ounces has been defined on results to date on the Main Tasat vein (detailed below in Table) and a total of 319,000 ounces including near mine resources (previous reported). Drilling continues in the Tumbang Lahung area on the Botol vein in addition to infill drilling at Tasat. A further resource upgrade based on this drilling is expected in the current quarter.

Based on existing resources and anticipated results detailed planning work has commenced to re-start mining operations. This decision is expected toward the end of the current quarter with operations commencing early in 2005. Initially production is likely to be at reduced capacity. This strategy is being implemented to fund past and future holding and exploration cost until such time as sufficient resources are defined to enable the plant to operate at full capacity.

Table: Mt Muro Resources June 30, 2004 (at a 1.4 g/t gold equivalent cut-off)

	Measured Tonnes	Grade Au equiv	Indicated Tonnes	Grade Au equiv	Inferred Tonnes	Grade Au equiv	Total Tonnes	Grade Au equiv
Near mine	185,817	4.9	1,270,172	3.5	259,930	4.3	1,715,919	3.8
Juking Sopan			871,109	3.9			871,109	3.9

Juking Sopan

In the Juking Sopan District a total of 138 drill holes have been completed by the end of the June quarter. The Tasat Vein has now been drilled on roughly 40 by 20 m centres over a strike length of approximately 600 metres.

Tumbang Lahung

A total of 49 drill holes have been completed so far at the Tumbang Lahung area 12 km west of the Mt Muro mine site.

Drilling has defined the narrow high grade Botol quartz vein dipping at 45 degrees with steeper rich splays. A number of the intercepts have recorded spectacular gold and silver grades.

A small elluvial portion is developed on the surface. Infill drilling is continuing to confirm the vein geometry and thickness. (*)