P&O Australian Resorts continues its commitment to product quality with the announcement of a major refurbishment program to be carried out across three of its properties during 2001.

�From it�s earliest days - with the acquisition of Heron Island in 1980 - through to the purchase of Lizard Island in May 1999, P&O Australian Resorts has managed a continuous program of upgrade and refurbishment across all seven of it�s properties,� explained James Baillie, Managing Director of P&O Australian Resorts.

�P&O Australian Resorts� philosophy is one which positions ongoing investment in infrastructure as a priority to ensure that each resort in the Australia�s Natural Treasures portfolio continues to provide guests with a unique nature-based holiday experience which also offers premium accommodation and facilities.�

�Last year saw the completion of a AUS$15-million refurbishment of Lizard Island - carried out during a six-month closure - and the final stage of an AUS$8million upgrade of Dunk Island. Throughout 2000, smaller scale projects were also carried out at Cradle Mountain Lodge with the introduction of new spa suites and dive facilities were upgraded on Heron Island.�

�During 2001, P&O Australian Resorts will embark upon major refurbishment programs for Heron Island, Bedarra Island and Silky Oaks Lodge. The level of work being undertaken at Heron and Bedarra Islands will necessitate a limited closure period. However on re-opening, resort guests will be able to enjoy improved accommodations and a greater range of activities,� said Mr Baillie.

Heron Island: Heron Island will close from 29 April � 20 May 2001, to allow for significant construction works to be completed on accommodations and a general upgrade of the resort, including back-of-house facilities.

Soft refurbishment projects will continue for an additional four months as selected accommodations are upgraded. This phase of the program will have minimal impact on guests and all resort activities will continue as per the normal operations program.

The major work programs on Heron Island include the demolition of the Island�s Turtle Cabins - which currently offer share facilities - and the introduction of a new grade of accommodation, Turtle Cabins, complete with ensuite facilities.

Heron Island refurbishment works will be completed by September 2001. Bedarra Island: Bedarra Island will close in May 2001 while the resort undergoes a soft refurbishment program. The new-look Bedarra will feature an extended beachfront deck; new bar and restaurant facilities and the island�s 15 villas will also be upgraded.

Bedarra�s closure from 4- 25 May will allow for the fast-tracking of project works. The resort will re-open on Saturday 26 May with a contemporary styled restaurant designed to showcase the Island�s tropical location and reflect it�s positioning as Australia�s most exclusive island resort.

Silky Oaks Lodge: An extensive refurbishment of chalet accommodations and the construction of new spa facilities will be carried out at Silky Oaks Lodge during 2001. The design brief for the project is to capture the relaxed feel of the resort�s rainforest location and to convey a sense of nature in all design elements.

The first phase of the program is expected to begin on 1 March 2001 and be completed by 25 June.

Accommodation at the resort will be reduced to 50 chalets, each given a fresh new look and an addition to resort facilities � the Healing Waters Spa � will also be constructed.

Silky Oaks� new Healing Waters Spa will be the third of P&O Australian Resorts� spas, each introduced during extensive upgrade programs.

�Spas represent a new signature experience offered by P&O Australian Resorts, � said Baillie

�Silky Oaks new Healing Waters Spa will join the Pavilion Spa on Lizard Island and Dunk Island�s Spa of Peace and Plenty. Each spa is created in an individual style reflecting the character and location of each resort and also offers unique products and treatments.�

The Healing Waters spa takes its name from the local indigenous language referring to the healing qualities of the Mossman River. The spa - and its treatments � will draw from the lush tropical environment and the spirit of the ancient rainforest, offering guests another opportunity to relax in beautiful surroundings.

Refurbishments at Silky Oaks Lodge will be completed by 16 September 2001.

EDITORS� NOTES: P&O Australian Resorts offer premium nature based holiday experiences in some of Australia�s most spectacular locations. Each property within the Australia�s Natural Treasures portfolio is a unique window to one of Australia�s World Heritage Listed areas and offers a range of quality soft adventure experiences in an individual, relaxed and professional style.

P&O Australian Resorts include: Bedarra Island; Brampton Island; Cradle Mountain Lodge; Dunk Island; Heron Island; Lizard Island & Silky Oaks Lodge Bedarra Island: Bedarra is Australia�s most exclusive island, an indulgent tropical private haven located off the coast of Cairns. A maximum of 30 guests are accommodated in 15 beautifully appointed secluded villas with all meals and 24 hour open bar included

Brampton Island: The Brampton Beat. A lively relaxed Whitsunday Island that offers lots of fun and great value for money. Most of the Island is a National Park and with seven golden sandy beaches and lots of activities to enjoy, most of them free, the Brampton Beat is the ideal Whitsunday resort. Brampton Island does not cater for day trippers or children.

Cradle Mountain Lodge: A spectacular retreat at the gateway to the Cradle Mountain/Lake St.Clair National Park in North Western Tasmania. Cradle Mountain Lodge offers a wonderful mountain wilderness experience with easy access to Cradle Mountain and Dove Lake National Parks.

Dunk Island: After a 4-month refurbishment program, Dunk Island emerged in September 2000 transformed as the Island of Peace and Plenty. This $2million investment followed a $6million upgrade of accommodation and furnishings carried out on Dunk Island in the previous two years.

Guests visiting the new-look Dunk Island will gain an immediate sense of being in a tropical paradise. The Plantation Bar and restaurant areas have undergone extensive remodeling and design features throughout the resort now echo the Island�s connection with the rainforest. This tropical rainforest island resort offers easy access to the Great Barrier Reed and almost unlimited choice of water and land based activities. Resort facilities include the Spa of Peace and Plenty, a farm, an artists� colony and Kids Club

Heron Island This World Heritage Listed coral cay island offers direct access to the spectacular beauty of the Great Barrier Reef which begins just where the white sands of the Island�s beaches end. Heron Island also has special �Junior Ranger� activities for children and offers close encounters with an amazing array of marine, animal and bird life.

Lizard Island: After a AUS$15million six-month refurbishment, (re-opening in late July 2000) the post modern Lizard is more spectacular than ever before. Located on the Great Barrier Reed, with coral gardens directly off shore, this remote, private paradise offers 24 white sandy beached and many activities.

As Australia�s first boutique Island resort, post-modern Lizard Island is the epitome of contemporary elegance with no compromise on quality, service or guest privacy and comfort. Accommodations and facilities are discreet in every aspect, complementing the natural environment and achieving an unprecedented level of style and facility. Dining and other service elements have also been redefined in a deluxe contemporary style. New facilities include the Pavilion Spa, gym and entertainment lounge. Lizard Island does not cater for children under 10 years.

Silky Oaks Lodge: The Daintree�s ultimate resort � a stylish property located just a few steps away from the ancient rainforest areas Queensland�s Daintree National Park. Surrounded by rainforest and overlooking the healing waters of the picturesque Mossman River, Silky Oaks Lodge is the perfect base from which to explore Port Douglas and the attractions of Tropical North Queensland

Media Contact: (not for publication) Julia Gauci P&O Australian Resorts 61 2 9364 8350 julia_gauci@poaustralia.com