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Fourth Quarter Activities Report

Document date:  Wed 31 Jul 2002
Published:  Mon 05 Aug 2002 10:24:30
Document No:  192947
Document part:  B
Market Flag:  Y
Classification:  Fourth Quarter Activities Report

TROY RESOURCES NL                             2002-07-31  ASX-SIGNAL-G

HOMEX - Melbourne                                                     

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CORPORATE REPORT

SERTAO FINANCING

Troy's 70% owned Brazilian subsidiary, Sertao Mineracao Ltda ("SML")
has received a firm offer of funding for the Goias Project. The
funding approved is for a US$5.5 million Project Loan and 40,000
ounce Gold Hedging Facility from N M Rothschild & Sons. This facility
is to fund the development of the Goias Velho Gold Project and
partially refinance the debt provided by Troy to SML.

MINING REPORT

BULCHINA MINE
SANDSTONE
(Troy Group 100%)

MINE PRODUCTION

Production for the Quarter was 11,135 ounces of gold at a cash cost
of A$236 per ounce. The Bulchina operation has continued to perform
above budget levels in terms of gold production and at below budget
costs.

For the 2001/02 financial year, gold production was 46,835 ounces at
a cash cost of A$219 per ounce.

The safety performance at the Bulchina Project and of the Company
overall is also of an excellent standard, with no Lost Time Injuries
recorded over the last 18 months.

The Company is a signatory to the Australian Minerals Industry Code
for Environmental Management. There were no environment issues during
the quarter.

GOLD PRODUCTION : BULCHINA

                  JUNE 2002    PREVIOUS        12 MTHS TO   12 MTHS TO
                  QUARTER      CORRESPONDING   JUNE 2002    JUNE 2001
                               QUARTER

Tonnes Milled      109,346       105,094       445,503      422,203
Head Grade (g/t)      3.28          4.07          3.41         4.46
Recovery (%)         96.52         96.00         95.89        96.30
Gold Produced (oz)  11,135        13,198        46,835       58,299
Cash Cost (A$/oz)     $236          $177          $219         $145

"Cash Costs" are defined to include all expenditures directly
incurred on mining and milling, plus overheads and outgoings net of
movements in deferred mining costs and stockpiles, but exclude
Government gold royalty payments.

MILLING

The mill has continued to perform well with no major problems. There
are no major capital costs expected over the next 12 months, except
for a lift of the tailings dam walls.

DEVELOPMENT

During the quarter, a new pit optimisation was completed for the
Bulchina Mine, which includes laterite ore from a southern extension
of the orebody. As at 1 May 2002, the Mine Reserve is 830,650t @
2.71g/t Au using a gold price of A$520 per ounce. In addition, at
that date, there was an ore stockpile at the mill of 81,520t @
1.87g/t  total contained gold of 77,275 ounces. This Reserve will
ensure around two years of production.

MINE EXPLORATION

A new drilling programme is being formulated to test for both
laterite and saprolite ore extensions.

GOIAS VELHO PROJECT
BRAZIL
(Troy 70%)

SERTAO GOLD MINE (Troy 70%)

MINE

All permits have now been received to allow mining to start under a
trial mining scheme. It is expected that the full mining permit will
be received by mid November 2002.

Excavation and foundation work at the plant site has commenced and
civil works are scheduled to start in late August 2002.

The Company is now assessing tenders for the open pit mining
contract. Orders have also been placed for the manufacture of
components required to complete the mill installation.

It is expected that ore mining will start mid October 2002, following
a small pre-strip, which has already commenced.

Geological remodelling of the Sertao Deposit following further
drilling, has now been completed. The drilling, which outlined
mineralisation in soil and updated existing data, has permitted a new
optimised mining Reserve of 228,900 tonnes @ 18.78g/t for 138,200
ounces of contained gold based on a gold price of US$310 per ounce.

This Reserve excludes the sulphide part of the orebody which will
require further metallurgical test work. Estimated recoveries of gold
from sulphides is around 88%. The remodelling, optimisation and
design was done by Snowden Mining Industry Consultants.

EXPLORATION

Geological mapping, prospecting and soil sampling programmes have
been ongoing along 20km of lightly explored, prospective stratigraphy
that stretches north from the Sertao Gold Deposit.

Four target areas have been defined to date, namely: North Antena,
Watershed 1, Watershed 2 and Sertao North (Figure 1). The first three
of these are marked by soil or soil sample gold colour anomalies and
high grade rock chip assays values, the last is marked by an
anomalous rock chip result of 3.38g/t Au. Soil sampling will be
undertaken in due course on this latter area. None of these targets
has yet been drill tested.

At Antena North, work by the previous owners (a subsidiary of WMC)
defined a soil anomaly measuring ~500m x 300m at >30ppb Au.
Prospecting within the area of the soil anomaly located visible gold
in hand specimen with a rock chip sample assay of 24.83g/t Au.

At Watershed 1, panned gold colours from soil samples, outlined an
anomaly measuring 1.4km x 200m with associated rock chip assays of
36.67g/t, 9.61g/t and 7.43g/t Au.

At Watershed 2, a soil anomaly measuring ~600m x 200m at >30ppb has
been defined with associated rock chip values of 81.25g/t and
35.83g/t Au.

A programme of reconnaissance, first pass diamond drilling will be
initiated in August on these targets.

CORNISHMAN JOINT VENTURE
SOUTHERN CROSS
(Troy 49%)

COMMENCEMENT OF MINING (STAGE 3)

Sons of Gwalia Ltd (51%), manager/operator of the Cornishman Joint
Venture, has confirmed that mining operations commenced on 30 July
2002. Open pit mining contracts have been awarded for the development
of Stage 3 at the northern end of the existing Stage 1 and 2 open
pit. The joint venture ore will be processed at Sons of Gwalia's
Marvel Loch treatment plant, located approximately 35 kilometres
south of Cornishman.

The ore Reserve (100%) calculated for Stage 3 is 543,800t @ 3.9g/t
for 68,200 contained ounces of gold, based on a gold price of A$525
per ounce.

To the south of the old pit, an open pit ore Reserve for Stage 4 has
been calculated at 428,000t @ 3.8g/t for 52,300 contained ounces, at
a gold price of A$525 per ounce. No decision has been taken on mining
Stage 4 by the Joint Venture at this stage, until the possibility of
further extension of this Reserve to the south has been investigated.
Sons of Gwalia Ltd is also analysing the economics of mining the
southern section via underground rather than open-cut methods.

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