PRESS RELEASE - Austindo announces drilling results of Cibaliung project in West Java and formation of joint venture

Drill Results

Austindo Resources Corporation is pleased to announce results of continuing drilling at its Cibaliung project.

At Cibaliung gold mineralisation is hosted within epithermal quartz-adularia veins and two high-grade shoots, referred to as Cikoneng and Cibitung have been identified to date.

Results from the first seven holes (AC-001 to AC-007) were reported in the Quarterly Report to the end of June, 2000. A further four holes have been completed (AC-008 to AC-011) for a total of 2,940 metres to date.

The latest drilling has tested for depth extensions at Cibitung. Three holes, AC-008, AC-010 and AC-011 intersected broad zones of quartz stockwork, quartz veins and vein breccia with average gold grades (no cut-off applied) as shown below. Hole AC-006, which has been reported previously, intersected the same broad zone:

AC-006 from 117.6m to 137.7m (20.1m downhole) 2.71g/t Au & 36g/t Ag.

AC-008 from 208.25m to 234.45m (26.2m downhole) 3.06g/t Au & 29g/t Ag.

AC-010 from 240.85m to 278.25m (37.4m downhole) 6.20g/t Au & 50g/t Ag.

AC-011 from 197.8m to 221.3m (23.5m downhole) 2.34g/t Au & 19g/t Ag.

Within this broad zone, higher potentially economic gold grades occur as two distinct lodes, one confined to the hangingwall of the main structure and the other towards its footwall. Silver values are higher in the footwall lode in AC-8, 10 & 11 suggesting that the two lodes may be the result of separate phases of mineralisation.

Hole AC-010 is particularly encouraging. It is the deepest hole drilled to date at Cibitung and intersected the shoot at approximately 250 metres below surface. The intersection indicates that the width of the overall vein structure increases with depth and that the width and grade of both the hangingwall and footwall lodes also increase with depth.

Hole AC-011 appears to occur towards the edge of the shoot where both lodes are present, but grade and width is lower. Hole AC-009 is outside the shoot limits and did not intersect any significant mineralisation.

Recent detailed studies of the vein mineralogy and structure suggest that the dilation zone that was responsible for localising the mineralisation at Cibitung, may be better developed at depth and to the south. This area provides a priority target and further drilling is being conducted with the objective of better defining the Cibitung Shoot and further extending it at depth.

Formation of Joint Venture Company

The Company is also pleased to confirm that it has obtained approval from the Indonesian Capital Investment and State-owned Enterprises and Development Board for the establishment of PT Cibaliung Sumberdaya ("CS") as a joint venture mining services company. In accordance with the terms of the Joint venture Agreement dated 2nd November 1999 ("JVA"), the Company will hold 63% of the shares in CS, and International Antam Resources Ltd ("IAR") will hold 37%. Further approval from the Indonesian Minister for Justice and Human Rights will now be pursued to enable CS to formally commence operations in Indonesia.

In accordance with the terms of the JVA, CS will enter into a Mining Services Agreement with both PT Aneka Tambang (a 65% state owned mining company) and PT Antam Resourcindo (a wholly owned subsidiary of IAR) who together hold the relevant authorisation to explore at Cibaliung (and are both parties to the JVA).

Under Indonesian mining law there are two types of licence relevant to gold. They are the Kuasa Pertambangan ("KP") and the Contract of Work ("CoW"). A KP is a mining authorisation which may only be granted to Indonesian government agencies, state enterprises, private corporations, co-operatives or Indonesian citizens. A CoW is a legally binding agreement with the government of the Republic of Indonesia and may be entered into with non-Indonesian investors.

Traditionally the Indonesian government has only permitted the granting of KPs in respect of projects located in Java. While the Company may not hold a KP, PT Aneka Tambang is approved by the Indonesian government to hold KP's in Java and accordingly the Company's participation in the Cibaliung project is a contractual one in the form of the JVA and of the Mining Services Agreement referred to above, rather than a direct interest in the KP.

Pursuant to a decree issued by the Ministry of Mines and Energy in Indonesia on 4 August, 1999 there is now provision for foreign controlled entities, such as CS, to hold a Contract of Work over projects located in Java. It is likely that CS will apply for a Contract of Work to directly secure a right to develop and mine the Cibaliung project. CS's right to do so is acknowledged by PT Aneka Tambang and PT Antam Resourcindo in the JVA.

The term of the existing exploration KP in respect of the Cibaliung project has now been extended for three years to 13 May, 2003 which is sufficient for the Company to carry out the necessary exploration required to determine the economic viability of the project. (*)