Next Iron Ore producer

Probably the next PMM or MGX??????
High grades needs no railway line and closer than other ports for overseas markets.


AZTEC RESOURCES LIMITED 2002-05-30 ASX-SIGNAL-G

HOMEX - Perth

+++++++++++++++++++++++++
The directors of Aztec Resources Limited ("Aztec Resources" or
"Company") are pleased to announce the Company has entered into
negotiations to acquire the remaining 30% interest of the Koolan
Island Project. The company currently holds a 70% interest in the
Koolan Island Project and completion of this acquisition will
increase its stake to a 100% interest.

The Company and the vendors of the Koolan Island Project are in the
process of finalising negotiations to enter into an option agreement
to give Aztec Resources the right to acquire the remaining interest
in the Koolan Island Project. The term of the option will be 12
months and the option fee will be $100,000. On exercise of the
option, Aztec Resources will be obligated to pay the vendors a
royalty of $2.50 per tonne of iron-ore produced.

KOOLAN ISLAND PROJECT

The Koolan Island Project is some 1900 km north of Perth, Western
Australia, and about 70km to the north of the port of Derby in the
Kimberley region of Western Australia.

Aztec Resources holds three exploration licence applications,
covering an area of approximately 200 square kilometres, over Koolan
Island and the adjacent mainland. The Koolan and Cockatoo Island
iron-ores are some of the richest and purest in the world,
containing between 67% and 69% Fe, with low contaminants in the form
of silica, phosphorous, aluminium and sulphur. BHP mined 67 million
tonnes of high-grade haematite ore averaging 67% iron between 1965
and 1994 when mining ceased.

Portman Mining and Henry Walker Eltin are mining extensions to the
ore on nearby Cockatoo Island, 5 kilometres to the west. Cockatoo
Island was also mined by BHP and closed in 1986.

A team of independent consultant mining engineers and geologists,
experienced in the iron ore industry, visited Koolan Island in April
to assess the ore reserve potential, and determine the status of the
Main Pit and satellite ore bodies following the closure of BHP's
mining operations in 1994.

The Company has been able to obtain a number of important technical
data from BHP which includes geotechnical studies on the hanging wall
and footwall slopes of the Main Pit and hydrographic information of
the shipping and berthing channels. In addition, final pit survey and
original topographic information has been obtained in a digital
format. External mining consultants have been briefed by Aztec mining
engineers who are currently preparing a scope of works and budget.
The data will be utilised by them to determine a conceptual mining
plan for a number of cutback scenarios in order to maximise the
economic potential of the proposed mine. This work will form part of
a pre-feasibility and feasibility study that will include costing for
infrastructure development, pit de-watering and contract mining
operations.

Further work is being undertaken that will include a new aerial
survey of the island and exploration drilling of the Main Pit western
extension and Mullet and Acaia orebodies.

Evaluation of the historical data and detailed reports prepared by
former BHP technical personnel, with experience on Koolan Island,
indicates that the ore reserve potential is far greater that
originally envisaged.

CAPITAL RAISINGS

The Company intends to raise approximately $1.8 million (before
costs) through the issue of 40 million shares at an issue price of
4.5 cents per share. The issue will include a free attaching option
for every 2 shares subscribed. The Company will also issue 120
million options at 0.2 cents per option to raise $240,000. 80 million
of these options will be offered to subscribers to the 40 million
shares on the basis of two options for every one share subscribed for
and issued. The balance of 40 million options will be issued at the
discretion of the directors. These options will have an exercise
price of 20 cents each and an expiry date of 31 January 2005.

Funds raised from the issue will be used to fund work on the Koolan
Island Project, in particular completion of a
pre-feasibility/feasibility study, to progress metallurgical test
work on the Company's Brockman Project, general exploration and
evaluation work, and for general working capital purposes. It is
anticipated that the Kooloon Island pre-feasibility study will be
completed within the next three months.

It is proposed that these capital raisings be placed through a Broker
to the Offer, and made through the issue of a prospectus.

RE-COMPOSITION OF BOARD

With the broadening of the Company's focus, in particular on the
Koolan Island Project and the Brockman Tantalum/Polymetallic Project,
it is proposed that the Board of the Company be re-constituted to
bring to the Company the necessary spread of experience to progress
its projects.

Mr Adam Rankine-Wilson has been invited to join the Board, such
appointment to be subject to shareholder approval. Subject to such
shareholder approval, Mr Rankine-Wilson will be invited to take the
role as Non-Executive Chairman. Mr Michael Povey has joined the Board
as a non-executive director. Mr Ron Gajewski has resigned as a
director of the company, however, will be retained by the Company in
a consulting role. Mr Neville Bassett has been appointed as company
secretary.

Subject to all necessary approvals the Board will comprise:

Adam Rankine-Wilson (Chairman)
Brett Matich (Managing Director)
Edmond Edwards (Executive Director)
Michael Povey (Non-Executive Director)

Mr Rankine-Wilson, aged 39, was appointed Managing Director of Grange
Resources Limited in 1990. In 1992 Grange took over Barrack Mines
Limited (now a wholly owned subsidiary of Grange). Over the past 12
years Mr Rankine-Wilson has been involved predominantly in the mining
industry and has a strong background in the finance and investment
sectors. During this period he has been a director/managing director
of various private and public companies, including Managing Director
of Quaestus (now Australian Silicon controlled by Portman Mining
Limited - approximately 72% shareholding). Mr Rankine-Wilson has a
minority interest in Koolan Island project.

Mr Povey is a Mining Engineer with 20 years extensive world-wide
experience in mining and mining related industries. His mining
experience has included management positions at some of the world's
largest open pit and underground operations and has included mine
operations and management, resource evaluation and mine development,
consulting and business management. The majority of his Australian
experience was gained in Western Australia including a close
involvement with the BHP Koolan Island iron ore operation through to
its closure in 1994.

Mr Povey is a Chartered Engineer, an Associate of the Camborne School
of Mines, Member of the Australian Institute of Mining and
Metallurgy, Affiliate Member of the Australian Institute of Company
Directors and holds a West Australian Unrestricted Quarry Managers
Certificate of Competency.

PROPOSED ISSUE OF OPTIONS TO DIRECTORS AND CONSULTANTS

The Company also proposes to issue a total of 20 million free options
to the directors, officers and consultants of the Company. The
options will be unlisted and have an exercise price of 5 cents each
and an expiry date of 30 June 2007.

The Company will seek shareholder approvals in respect to the
proposed issue of options and the capital raisings.

ESCROW ARRANGEMENTS

On 16 May 2002, 100 million shares were released from escrow. Of
these shares the subject of the release, 15 million shares will
remain escrowed pursuant to voluntary escrow agreements until 16
August 2002 and 75 million shares will remain escrowed pursuant to
voluntary escrow agreements until 16 May 2003.


B Matich
MANAGING DIRECTOR