4DS MEMORY LIMITED — Interim / Quarterly Report 2013

Jan 30, 2014

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ASX: FRY
www.fitzroyresources.com.au
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31 January 2014

Quarterly Report for the period ending 31 December 2013

• Premier transaction completed with improved terms

• Due diligence drilling completed and exploration continues in 2014

• Significant coking coal intersection in maiden deep drill hole

• Technical Report confirms high quality hard coking coal

Completion of the Acquisition of Premier Coking Coal Limited

During the period, Fitzroy Resources Limited (“Fitzroy” or “The Company”) completed the transaction to acquire 100% of Premier Coking Coal Limited (“Premier” or “PCC”) and its subsidiary, Premier Coking Coal LLC, a US based coal exploration and development company (“Premier Option”).

The primary focus of Fitzroy’s activities for 2014 and beyond will now be the development of the Emmaus and Blackstone properties (see location map - Figure 1) and to become a low capital cost, profitable producer of hard coking coal.

Fitzroy will continue to assess further acquisitions in the vicinity of both properties.

Completion of Due Diligence Drill Program

The due diligence program related to the acquisition of Premier was completed during December. The program successfully confirmed the accuracy of the 50 historic drill holes that existed at Emmaus and Blackstone.

A drill program will be prioritised at Blackstone in 2014 that aims to define a maiden resource. Defining a resource at Emmaus and Blackstone is an important first step toward the Company’s strategy to become a coking coal producer during 2014. The proposed drilling locations are shown in Figure 2.

The final hole of the due diligence drilling has successfully intercepted 3.8 feet (1.2 meters) of coal in the only hole planned to be drilled below the water table. The discovery of coal of mineable thickness at greater depth could have a significant impact on the long term future of the Emmaus project’s future development. Coal Inventories are known to exist within the region in seams such as the Sewell, Beckley (War Creek), Firecreek and Pocahontas. To our knowledge, no previous deeper drilling has occurred at Emmaus.

Drilling during 2014 will also test the extents and continuity of the deeper coal mineralisation in the Beckley while also testing for Fire Creek and Pocahontas seams. The proposed drilling locations are also shown in Figure 2.

The results of the due diligence program and the historic drill holes were announced on 6 December 2013.

Fitzroy Resources Limited Level 1, 35 Havelock Street PO Box 839 T +61 8 9481 7111 E admin@fitzroyresources.com.au West Perth WA 6005 West Perth WA 6872 F +61 8 9320 7501 W www.fitzroyresources.com.au

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FIGURE 1 - LOCATION MAPS OF EMMAUS AND BLACKSTONE PROPERTIES

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FIGURE 2 - EMMAUS DUE DILIGENCE PROGRAM AND PROPOSED 2014 DRILL HOLE LOCATIONS

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Independent Technical Report

The Emmaus and Blackstone Technical Report[1] (“Technical Report”) was prepared by Cardno MM&A (“Cardno”) and commissioned to assist Fitzroy during its due diligence period.

The full report is available on the homepage of the Fitzroy Resources website.

The Technical Report considered four key seams at the Emmaus Property (Douglas, Gilbert, Lower War Eagle and the Beckley) and the same seams on the Blackstone Property except the Lower War Eagle, which is not included in the Blackstone option. Estimates of coal quality and based on historical exploration and mining data indicate the coal is a mid-volatile hard coking coal.

The Technical Report was an assessment of the historic and recent drill hole results, a description of the features of the property and contained an initial Exploration Target of hard coking coal at both properties. It verified the likelihood of mid volatile, low sulphur hard coking properties of the coal and discusses the project’s reasonable prospect for economic extraction both above and below drainage.

Key findings included:

• Little to no evidence of faulting or folding

• The above water table, hillside target seams are generally contiguous

• Based on the available quality data the target seams are characterised as mid-volatile, low sulfur bituminous coking coal

• Can potentially be mined by underground and highwall/auger methods

Cardno endorsed and supported the ongoing exploration program to potentially identify and quantify Coal Resources on the Emmaus Property, as well as the Blackstone exploration program. Provided positive results from the exploration, Cardno believes the identification of potential resources areas could provide a sufficient Coal Resource quantity to justify coal production on both the Emmaus and Blackstone Properties.

Exploration Target

As part of the Technical Report, Cardno identified an Exploration Target.

The Exploration Target was broadly defined using the historic drilling data and the due diligence drilling conducted by Fitzroy. Cardno’s experience and knowledge of the region was also an important consideration.

The potential quantity and grade of the Exploration Target is conceptual in nature in that there has been insufficient exploration to estimate a Coal Resource and that it is uncertain if further exploration will result in the estimation of a Coal Resource.

A full description of the basis for the estimate and proposed activities to test the validity of the Exploration Target are available in the Technical Report and the Fitzroy ASX release of 10 December 2013.

1 An ASX release of the technical report and exploration target was announced on 10 December 2013. The full technical report is available on the homepage of the Fitzroy website

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When assessing the Exploration Target reasonable prospects of economic extraction were assessed by considering factors such as:

• Infrastructure;

• likely mining methodology;

• transportation and coal handling and;

• permitting

The Exploration Target is shown in Table 1 and Table 2

Seam	Mining Type	Low	High	Average
Emmaus Property
Lower War Eagle	Surface and Highwall	400	480	440
Gilbert	Underground	1,800	1,910	1,860
Douglas	Underground	1,930	2,110	2,020
Beckley (War Creek)	Underground	5,580	9,210	7,400
Total Emmaus Property		9,710	13,710	11,720
Blackstone Property
Gilbert	Surface and Highwall	450	660	560
Gilbert	Underground	530	770	650
Douglas	Underground	650	1,040	850
Beckley (War Creek)	Underground	0	0	0
Total Blackstone Property		1,630	2,470	2,060
Total By Seam
Lower War Eagle	Varies	400	480	440
Gilbert	Varies	2,780	3,340	3,070
Douglas	Underground	2,580	3,150	2,870
Beckley (War Creek)	Underground	5,580	9,210	7,400
Total By Seam		11,340	16,180	13,780
Total By Mining Type
Surface and Highwall	Varies	850	1,140	1,000
Underground	Varies	10,490	15,040	12,780
Total By Mining Type		11,340	16,180	13,780

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TABLE 1 - EXPLORATION TARGET ESTIMATE RANGE (X 1,000 IN-PLACE TONS)

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							Free	Max.
	Wh				lb SO2	Vlil
Proximate Analysis	as	Ash (%)	Sulfur (%)	Btu/lb	per	oate	Swelling	Fluidity
	R				MB	M
	ecovery				tu	atter	Index	(DDPM)
Gilbert Seam - Processed Coal Proximate Analysis
Average Maximum Minimum # Samples	84.1 96.2 50.0 12.0	9.4 12.4 8.1 12	0.75 0.87 0.65 12	13,949 14,275 13,506 7	1.05 1.17 0.94 7	25.7 27.3 23.1 11	8.7 9.0 8.5 12	27,821 29,823 24,487 3
Douglas(Red Ash) Seam - Processed Coal Proximate Analysis
Average Maximum Minimum	84.1 99.0 53.3	2.6 3.6 1.8	0.70 1.03 0.58	15,153 15,362 15,019	0.88 0.92 0.83	26.9 28.4 25.8	9.0 9.0 8.5	24,910 29,696 19,693 5
# Samples	14	14	14	8	8	13	14

TABLE 2 - SAMPLES OF HISTORIC DRILL PROGRAMS AT EMMAUS AND QUALITY RANGE OF EXPLORATION TARGET

Rookwood

During the September quarter, a geochemical sampling program at Rookwood was completed, following up on areas of heightened geophysical anomalism coupled with prospective geology. A further sampling program was completed during the December quarter. Results from the 100 samples taken were received during the quarter and have not highlighted any new areas of anomalism for immediate drilling however the multi-element geochemistry will be used to plan future exploration programs.

Glentanna

No work has been done at Glentanna during this reporting period.

Corporate

Improvement of Premier Transaction

On 12 November 2013, Fitzroy announced to the market that it had considerably improved the terms of the transaction with the shareholders of Premier Coking Coal and the owners of the Emmaus and Blackstone leases which Premier holds and option over. The table below illustrates the differences in the terms.

	Previous terms		New Terms
	Fitzroy receives: Emmaus Lease Share consideration: 55 million FRY ordinary shares 55 million FRY performance shares Cash consideration: US$1,600,000		Fitzroy receives: Emmaus Lease Blackstone Lease Deep Mine Permit Share consideration: 30 million FRY ordinary shares 20 million FRY performance shares Cash consideration: US$805,000

This was a significant outcome for Fitzroy. Not only were the terms and cash requirements to complete the deal substantially improved, but the current owners of the property leases, Emmaus Partners, have agreed to join the Fitzroy share register as a show of faith in the projects that we are acquiring. Emmaus Partners are individuals who have mined and done business within the West Virginian coal industry for a long time. Also included in the new terms was the Blackstone mineral lease. Blackstone is adjacent to Emmaus property and is permitted, giving Fitzroy immediate access to the Red

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Ash/Douglas seam at any time in the future after we have completed our technical, engineering and financial analysis.

Director Appointment

In October Russell Lynton-Brown was appointed as a Non-Executive Director of the company. Russell has a background in the Stockbroking and Corporate finance sector. He has extensive experience in the provision of advice to retail, institutional and corporate clients focusing on the natural resources sector.

Cash Position and Capital Raise

On 23 December 2013, Fitzroy announced a Rights issue and Placement to raise A$1.279 million.

The placement is complete and rights issue closed with an acceptance level of 56.3% for a total of $579,155 received. Underwriters have indicated funds for the shortfall of $449,845 will be received during the week commencing 3 February 2014. Current cash reserves including the proceeds of the capital raising are expected to cover cash requirements for the remainder of the 2014 financial year.

The cash position as at 31 December 2013 is $434,000.

Benjamin Lane

For further information contact:

Mr Benjamin Lane Mr Simon Robertson Chief Executive Officer Company Secretary +61 8 9481 7111 +61 8 9481 7111

Competent Person Statement

The information in this report that relates to Exploration Results and the Exploration Target is extracted from the reports entitled “Due Diligence Completion & Significant Intercept – Emmaus” created on 6 December 2013 and “Technical Report Completed for Emmaus and Blackstone” created on 10 December 2013 and are available to view on www.fitzroyresources.com.au. The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements. The company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.’

Tenement Schedule

Tenement Schedule
Project	Location	Tenement	Interest
Rookwood	Queensland	EPM17604	100%
Rookwood	Queensland	EPM18845	100%
Rookwood	Queensland	EPM16749	100%
Glentanna	Queensland	EPM15401	100%
Coal Lease	Location	Land Owner	Option to Acquire	Lease Date
Emmaus	WV,USA	Kim Peraldo Gilley,et al.,Trustess	100%	24/7/2012
Emmaus	WV,USA	Harrold Investment,LP	100%	23/8/2012
Emmaus	WV,USA	Red Bird Pocahontas Land,LLC	100%	26/9/2012
Emmaus	WV,USA	C.O. Davis,Jr.,et al.,	100%	21/11/2012
Blackstone	WV,USA	Marco Land Company,Inc	100%	26/9/2012

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About Fitzroy Resources

Capital Structure (31 December 2013) Share Code ASX: FRY Shares on Issue 73.5 Million Options 6 Million Performance Shares on issue 20 Million Directors and Management Projects Tom Henderson, Chairman Emmaus: Rookwood: Will Dix, Director Hard Coking Coal Property VHMS copper/gold prospect Ric Vittino, Director West Virginia, USA 70km NW of Rockhampton, Qld Russell Lynton-Brown , Director 100km S of Charleston, WV Glentanna: Blackstone: VHMS copper/gold prospect Benjamin Lane , Chief Executive Officer Hard Coking Coal Property 140km SW of Brisbane, Qld Simon Robertson, Company Secretary West Virginia, USA 100km S of Charleston, WV

Fitzroy Resources Ltd is an Australian based coal development company, with two hard coking coal projects in West Virginia, USA.

Fitzroy’s main focus is to explore the coal potential of the Emmaus and Blackstone projects for hard coking coal and to rapidly develop into a producer of hard coking coal to the US domestic and export markets.

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FIGURE 3 – LOCATION OF EMMAUS AND BLACKSTONE

Fitzroy also owns the Rookwood and Glentanna exploration tenements in Queensland, Australia. Rookwood contains potential for the discovery of substantial VHMS copper/gold deposits beyond the existing resource.

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