Matrix Metals | Copper Production and Exploration

Matrix Metals Limited is pleased to report the results of the first 36 holes from the 82 hole drilling program completed at the Mt Watson Prospect in late December 2001. The Mt Watson Prospect is located 25 km away from the Company's cathode copper production facility at Mt Cuthbert in north west Queensland.

These initial results have extended the area containing resource grade intersections from 650 to approximately 1,100 metres of strike length. A resource upgrade is currently being estimated and will be reported when completed.

Significant intercepts reported from the first 36 holes are:

(Maximum hole depth 25.5 m)

Table

As summarised above, these results confirm extensions of strongly mineralised zones to the east and west of the existing resource area. The sections containing resource grade and width mineralisation have now been drilled from 9,350 m East to 10,425 m East on the local grid. The resulting new resource area will extend, with minor sub-resource grade/width intervals, for approximately 1.1 kilometres of strike length.

Table 1.0 reports the drill hole location of the first 36 holes.

Table 1.0

Results for the remaining 46 holes, which tested for mineralisation in areas 400m to the east and 650m to the west of the resource area, are due over the next week and will be reported when received. The total strike length tested by this, and the previous drilling campaign, now totals approximately 2.1 kilometres.

Yours sincerely,

Andrew Chapman
Chief Executive Officer

The geological information in this report is based on information compiled by the Company's Senior project Geologist, Mr Phil Frank and the Company's Operations Manager, Mr Bob Dennis both of whom are employees of Matrix Metals Limited. Messrs Frank and Dennis each have a minimum of 5 years experience in estimation, assessment of, and evaluation of Mineral Resources and Ore Reserves, which are relevant to the style of mineralisation under consideration.