Exhibit 10.7

                    AMENDED AND RESTATED CONSULTING AGREEMENT

      This Agreement is entered into and is effective on February 1, 2001 by and
between  Alloy  Steel  International,  Inc, a Delaware  corporation,  having its
principal place of business at 42 Merchantile Way Malaga,  P.O. Box 3087, Malaga
D C 6945, Western Australia (the "Company"),  and Persia Consultants,  Inc. (the
"Consultant").

      WHEREAS,  the Company desires to retain  Consultant to provide services to
the Company.

      NOW THEREFORE,  in  consideration of the premises and the mutual covenants
and agreements  herein  contained,  the parties hereto do covenant and agree, as
follows:

      1. Restated Agreement.  This Amended and Restated agreement supersedes and
replaces the Agreement dated as of October 2, 2000.

      2.  Retention.  The Company  hereby  retains  Consultant to render certain
advisory services (the "Services") with regard to corporate development and such
other related  activities as the Board of Directors of the Company may from time
to time direct,  and consulting with the Board of Directors from time to time as
requested  by the Company.  Consultant  agrees to use its best efforts to supply
the Services in a professional and diligent manner.

      3. Term. The Term of this  Agreement  shall be twelve (12) months from the
date hereof,  but within the 12-month  period,  the Company may,  without cause,
elect to terminate the  Agreement by giving  thirty (30) days'  written  notice.
Upon such termination, Consultant shall be relieved of any further obligation of
performance  to  the  Company;  provided,   however,  that  all  obligations  of
confidentiality,  non-disclosure and non-competition will continue in full force
and effect for one (1) year from the effective date of any termination.  If this
agreement shall be terminated prior to the end of the Term, the Consultant shall
not, in any event, be liable to return any pre-payment. The parties hereby agree
that any pre-payment  made to Consultant  shall be fully earned by Consultant at
the time such  pre-payment is made and shall be in consideration of Consultant's
agreement  to expend  time,  effort  and  energy on  behalf  of  Company  to the
exclusion of other clients.

      4. Compensation.  The Company acknowledges that it does not currently have
the financial ability to pay for Consultant's Services in cash.  Therefore,  the
Company shall, in consideration of Services to be performed,  and for other good
and  valuable  consideration,  the receipt and  sufficiency  of which are hereby
acknowledged by the Company,  concurrently with the execution hereof, pay to the
Consultant a total of One Million Three Hundred and Fifty  Thousand  (1,350,000)
shares of the common stock (the "Shares") of the Company.

      5. Consultant's Non-Disclosure of Information/Non-Competition.

            a. The Consultant  acknowledges that in the course of its engagement
            it may become  familiar  with trade  secrets and other  confidential
            information  (collectively,  "Confidential Information" ) concerning
            the Company and Consultant shall hold in


<PAGE>

            a  fiduciary  capacity  for the  benefit of the  Company all secret,
            confidential proprietary information,  knowledge or data relating to
            the Company that shall have been obtained by the  Consultant  during
            its engagement by the Company and that shall have not been or now or
            hereafter  have become public  knowledge  (other than by acts by the
            Consultant or its  representatives  in violation of this Agreement).
            Consultant  agrees that it shall not disclose to any third party any
            Confidential  Information for any purpose other than the performance
            of its duties under this Agreement. During the Term and at all times
            thereafter,  regardless  of the reason for the  termination  of this
            Agreement,  Consultant  shall not, without the prior written consent
            of the  Company  or as  otherwise  may be  required  by law or legal
            process,  communicate or divulge any such information,  knowledge or
            data to anyone  other than the Company and those  designated  by the
            Company.

            b.  Upon  completion  of the  Term or  earlier  termination  of this
            Agreement for any reason,  Consultant will return to the Company any
            confidential  materials  or  information  which the Company may have
            supplied  to the  Consultant.  Consultant  may retain a copy of such
            materials or information  for  Consultant's  own due diligence file.
            However,  Consultant hereby agrees not to distribute or release such
            confidential  materials or information without giving the Company at
            least five (5) days'  written  notice so that Company shall have the
            opportunity,  at Company's sole cost and expense, to move to prevent
            Consultant's distribution or release of the confidential material or
            information.

            c. Subject to the  limitations set forth herein,  Consultant  agrees
            that  during  the Term and for a period  of one year  thereafter  it
            shall not directly or indirectly, own, manage, control,  participate
            in,  consult with,  render  services for, or in any manner engage in
            any  business  competing  with the  business  of the Company as such
            business  exists within any  geographical  area in which the Company
            conducts its business.  In addition,  Consultant  shall not solicit,
            interfere  with or conduct  business with any vendors,  customers or
            employees of the Company  during the term of this Agreement or for a
            period of one year after the  termination  hereof.  In the event the
            Company  breaches  any of  its  duties  or  obligations  under  this
            Agreement,  the Company agrees that Consultant shall not be bound by
            the  provisions  of  this  Agreement,   except  for  the  provisions
            concerning Confidential Information.

      6. Restrictions on Transfer

      The  Consultant  understands  and  agrees  that the  Securities  purchased
pursuant to this  Agreement  are being  offered  pursuant to Section 4(2) of the
Securities Act of 1933, as amended, (the "Securities Act"), and that such shares
and any interests therein,  may not be offered,  sold,  transferred,  pledged or
otherwise disposed of except pursuant to (i) an effective registration statement
under the  Securities Act and any applicable  state  securities  laws or (ii) an
exemption from registration under


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<PAGE>

such act and such laws  which,  in the  opinion of counsel for the holder of the
Securities, which counsel and opinion are reasonably satisfactory to counsel for
the Company, is available.  The Consultant  represents that he is an "accredited
investor"  as such term is defined in Rule 501(a) of  Regulation  D  promulgated
under the Securities  Act. The Consultant  also  understands and agrees that the
following  legend  shall  appear on  Securities  and that the  Company  may give
appropriate  instructions  to the transfer  agent for the  Securities to enforce
such restrictions:

      THESE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
      REGISTERED  UNDER  THE  SECURITIES  ACT OF 1933 OR  APPLICABLE
      STATE SECURITIES LAWS. THESE SECURITIES HAVE NOT BEEN ACQUIRED
      WITH A VIEW TO  DISTRIBUTION  OR RESALE,  AND MAY NOT BE SOLD,
      MORTGAGED,  PLEDGED,  HYPOTHECATED  OR  OTHERWISE  TRANSFERRED
      WITHOUT AN EFFECTIVE  REGISTRATION  STATEMENT  FOR SUCH SHARES
      UNDER  THE  SECURITIES  ACT OF 1933 AND ANY  APPLICABLE  STATE
      SECURITIES LAWS, OR AN OPINION OF COUNSEL  SATISFACTORY TO THE
      COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES
      ACT OF 1933 OR UNDER APPLICABLE STATE SECURITIES LAWS.

      7. Arbitration.  Any dispute, controversy or claim between the Company and
the Consultant  arising out of or related to this  Agreement  shall be conducted
solely  in a  proceeding  held in  accordance  with the  rules  of the  American
Arbitration Association then in effect. This Agreement, or breach thereof, shall
be settled by arbitration, and any award shall be binding and conclusive for all
purposes thereof,  may include injunctive relief (but only as ordered by a Court
of competent  jurisdiction),  as well as orders for specific performance and may
be  entered  as a final  judgment  in any court of  competent  jurisdiction.  No
arbitration  arising out of or  relating to this  Agreement  shall  include,  by
consolidation or joinder or in any other manner,  parties other than the Company
and the Consultant and other persons  substantially  involved in common question
of fact or law whose  presence is required if complete  relief is to be afforded
in  arbitration.  The cost and  expenses of such  arbitration  shall be borne in
accordance with the  determination of the arbitrator and may include  reasonable
attorney's  fees,  provided,  however,  that if either party shall  commence any
action or  proceeding  against  the  other in order to  enforce  the  provisions
hereof,  or to recover  damages  resulting from the alleged breach of any of the
provisions hereof, the prevailing party therein shall be entitled to recover all
reasonable costs incurred in connection  therewith,  including,  but not limited
to, reasonable attorneys' fees. Each party hereby further agrees that service of
process may be made upon it by registered or certified mail, express delivery or
personal service at the address provided for herein.

      8.  Remedies.  In the  event of the  actual  or  threatened  breach of the
provisions of this Agreement by a party, the other party shall have the right to
obtain injunctive relief and/or specific


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<PAGE>

performance and to seek any other remedy available to it.

      9. Law,  Venue,  Jurisdiction.  This  agreement and all matters and issued
collateral  thereto shall be governed by the laws and the courts of the State of
New York without regard to the principles of conflicts of laws.

      10.  Severability.  If any provision of this Agreement becomes or is found
to be illegal or  unenforceable  for any reason,  such clause or provision  must
first be  modified  to the extent  necessary  to make this  Agreement  legal and
enforceable  and then if  necessary,  second,  severed from the remainder of the
Agreement to allow the  remainder  of the  Agreement to remain in full force and
effect.

      11. Counterparts.  This Agreement may be executed in several counterparts,
and all of such counterparts taken together shall be deemed to be one Agreement.

      12.  Attorneys'  Fees.  If  either  party  shall  commence  any  action or
proceeding  against the other in order to enforce the provisions  hereof,  or to
recover  damages  resulting  from the  alleged  breach of any of the  provisions
hereof, the prevailing party therein shall be entitled to recover all reasonable
costs  incurred  in  connection  therewith,   including,  but  not  limited  to,
reasonable attorneys' fees.

      13.  Waiver  of  Breach..  The  waiver  by any  party of a  breach  of any
provision  of this  Agreement  shall not operate be construed as a waiver of any
subsequent breach by any party.

      14.  Notices.  Each notice,  demand,  request,  approval or  communication
("Notice")  which is or may be  required  to be given by any  party to any other
party in  connection  with  this  Agreement  and the  transactions  contemplated
hereby,  shall be in writing,  and given by personal  delivery,  certified mail,
return receipt  requested,  prepaid,  or by overnight  express mail delivery and
properly addressed to the party to be served at such address as set forth above.
Notices  shall be effective on the date  delivered  personally,  the next day if
delivered  by  overnight  express  mail or three days  after the date  mailed by
certified mail.

      15. Entire Agreement. This Agreement contains the entire agreement between
Consultant  and Company,  and correctly sets forth the rights and duties of each
of the  parties  to each  other  concerning  such  matter as of this  date.  Any
agreement or  representation  concerning the subject matter of this Agreement or
the duties of Consultant in relation to Company not set forth in this  Agreement
is null and void.

      16. Binding  Effect.  The rights created by this Agreement  shall inure to
the benefit of, and the  obligations  created  hereby  shall be binding upon the
parties, their heirs, successors, assigns and personal representatives.

      IN WITNESS  WHEREOF,  the parties  hereto have executed this Agreement the
day and


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<PAGE>

year first hereinabove written.

                                            ALLOY STEEL INTERNATIONAL, INC.

                                            By: ________________________________
                                                Name:
                                                Title:

                                            Persia Consultants, Inc.

                                            ____________________________________



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