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Drills for Nickel at Greenvale as Qld Exploration Kicks Off

COBRA RESOURCES LIMITED 2002-07-04 ASX-SIGNAL-G

HOMEX - Adelaide

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Cobra Resources Ltd (ASX: CBO) is preparing to kick off a drilling
program in the Greenvale laterite nickel-cobalt project near Cairns
in far north Queensland, previously operated by Queensland Nickel, as
its 2002 field season gets underway.

Greenvale, part of Cobra's Three Rivers Project, contains significant
remnant ore from previous mining operations which the Company plans
to evaluate together with ore from the nearby Lucknow Project.

Cobra's Chairman, Mr Laurie Ziatas, said previous drilling had
indicated significant areas of mineralisation remaining within the
old Greenvale pit which may be amenable to low-cost, low-temperature
and pressure acid leaching techniques.

"Some of this ore is beneath waste dumps left by previous mining," he
said. "The current drilling program is designed to test the
continuity of the remnant ore zones and possible extensions of the
ore to the south of the pit."

"We have already commenced metallurgical evaluation of the ore at
both Greenvale and Lucknow, with a view to determining further
development options," Mr Ziatas added.

At Cobra's Marlborough Project, further to the south inland from
Rockhampton, Cobra is currently evaluating the laterite nickel-cobalt
potential of the Mt Redcliffe area within its Cabbage Tree EPM, along
with other areas of previously recognised laterite potential.

Mr Ziatas said metallurgical evaluation of nickel-cobalt ore
previously drilled on the nearby South Slopeaway tenements was also
in progress, including the potential reactivity of the ore with
dilute sulphuric acid. "This data will give an indication of which
ores may have potential to be processed using low-pressure acid
leaching technologies."

A number of chromite occurrences within the Cabbage Tree tenement are
also being evaluated for their gold and PGM potential, particularly a
number of small chromite lenses previously tested by other operators
which occur within shear zones.

The Perth-based Company also today (Thursday) announced the sale of
the nickel-cobalt and platinum rights to its Walhalla tenements in
Victoria to Perth-based Goldstar Resources Limited.

Cobra had previously sold the Victorian tenements to Perseverance
Mining Pty Ltd (a subsidiary of Perseverance Mining Corporation NL),
but retained the nickel-cobalt and PGM rights. Under an agreement
announced today, Cobra will transfer its nickel-cobalt and PGM rights
to Goldstar in return for a 4% Nickel, Cobalt and PGM Net Smelter
Return payable quarterly in arrears.

The agreement is subject to Goldstar's successful listing on the
Australian Stock Exchange.

Cobra is focusing on its Queensland and PNG laterite nickel projects
and Marlborough chrysoprase projects in Queensland as its prepares to
launch its new exploration spin-off, Musgrave Minerals Ltd.

The Company has received shareholder approval for the spin-off, which
will see Musgrave raise up to $6 million to pursue the exploration of
a promising portfolio of projects in the West Musgrave region of
Western Australia, with Cobra and Cobra shareholders directly
receiving a substantial stake in the new entity.

Musgrave Minerals expects to lodge a Prospectus with the Australian
Securities and Investments Commission (ASIC) within the next week,
with the Record Date for priority entitlements to the new issue for
Cobra shareholders to be announced shortly.

Mr Ziatas said final underwriting agreements were currently being
negotiated for the IPO.

Released by: On behalf of:
Jan Hope / Nicholas Read Laurie Ziatas
Jan Hope & Partners CHAIRMAN
Telephone: (08) 9388-1474 Cobra Resources Ltd
Telephone: (08) 9325-4096