quarterly out, page-15

1 March 2006
The Manager
Company Announcements
Australian Stock Exchange Limited
Dear Sir,

(i) Commencement of Final Design/Construction

(ii) Election to use new equipment

(i) Australian Zircon advises that the Company has commenced development of its 100% owned Mindarie Zircon Project in the western Murray Basin.

�� The Company has given an interim order to international engineering firm Parsons Brinckerhoff to commence the development of a project development plan.

�� The Company has also given an interim order to the respected Australian mineral sand engineering firm RJ Robbins and Associates to proceed with detailed mechanical design.

This work will, subject to final sign off of formal legal documentation scheduled for execution during March, lead to fabrication and procurement of the items required for construction of the Mindarie facilities.

(ii) Australian Zircon also advises that following detailed engineering assessment of its equipment needs, the Company has elected to source nearly all new equipment for the Mindarie construction. Accordingly, the Company will not proceed to purchase the second hand equipment secured under the option announced to ASX in July last year. The Company’s commitment to all-new equipment is not expected to impact the Project’s development schedule and the associated costs are able to be accommodated within the existing development budget.

Yours faithfully,
Peter E

1 March 2006
The Manager
Company Announcements
Australian Stock Exchange Limited
Dear Sir,
(i) Commencement of Final Design/Construction
(ii) Election to use new equipment
(i) Australian Zircon advises that the Company has commenced development of its 100% owned Mindarie Zircon Project in the western Murray Basin.
�� The Company has given an interim order to international engineering firm Parsons Brinckerhoff to commence the development of a project development plan.
�� The Company has also given an interim order to the respected Australian mineral sand engineering firm RJ Robbins and Associates to proceed with detailed mechanical design.
This work will, subject to final sign off of formal legal documentation scheduled for execution during March, lead to fabrication and procurement of the items required for construction of the Mindarie facilities.
(ii) Australian Zircon also advises that following detailed engineering assessment of its equipment needs, the Company has elected to source nearly all new equipment for the Mindarie construction. Accordingly, the Company will not proceed to purchase the second hand equipment secured under the option announced to ASX in July last year. The Company’s commitment to all-new equipment is not expected to impact the Project’s development schedule and the associated costs are able to be accommodated within the existing development budget.
Yours faithfully,
Peter E