ADAVALE RESOURCES LIMITED — Interim / Quarterly Report 2011

Jan 30, 2012

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

	Name of entity	Quarter ended (“current quarter”) 31 December 2011	Quarter ended (“current quarter”) 31 December 2011
	Adavale Resources Limited
	ABN 96 008 719 015 Consolidated statement of cash flows
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration and evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (compulsory acquisition of shares) Net Operating Cash Flows		Current quarter $A’000	Year to date (6 months) $A’000
		- (545) - - (218) - 6 - - -	- (803) - - (629) - 51 - - -
		(757)	(1,381)
Cash flows related to investing activities 1.8 Payment for purchases of: (a)prospects (b)equity investments (c) other fixed assets 1.9 Proceeds from sale of: (a)prospects (b)equity investments (c)other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)		- - - - - - - - -	- - - - - - - - -
		-	-
		(757)	(1,381)

1.13 Total operating and investing cash flows (brought forward)	(757)	(1,381)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (cost of raising funds and sale unmarketable parcel of shares) Net financing cash flows	- - - - - -	- - - - - (45)
	-	(45)
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end ofquarter	(757) 2,240 -	(1,426) 2,909 -
	1,483	1,483

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

• Current quarter $A'000

• 1.23 Aggregate amount of payments to the parties included in item 1.2 158 1.24 Aggregate amount of loans to the parties included in item 1.10 - 1.25 Explanation necessary for an understanding of the transactions  Payments totaling $49,710 were made directly to Mr J Risinger and to Larca Pty Ltd, an associated entity of Mr Risinger. The disbursements were in relation to consulting fees, director fees and salary owing.

• Payments totaling $39,600 were paid to Entertainment Marketing Enterprise Pty Ltd, an associated entity of Mr P Suriano. The disbursements were in relation to director fees and consulting fees in relation to the development of Adavale Indonesian project.

• Payments totaling $34,925 were made to Arthur Phillip Pty Ltd, an associated entity of Mr R Poole. The disbursements were in relation to preparing the annual financial report, ASX reporting requirements and company secretarial services.

• Payments totalling $6,600 were paid to Mr R Poole, for director fees owing.  Payments totaling $6,000 were made to Mr M Stevenson in relation to director fees owing.  Payments totaling $20,169 were made to Steinepreis Paganin, an associated entity of Mr R Steinepreis. The disbursements were in relation to director fees and legal services.

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

N/A

• 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

N/A

Financing facilities available

Add notes as necessary for an understanding of the position.

	3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
		-	-
		-	-

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	400
	-
	-
	200
Total	600

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
5.1 Cash on hand and at bank 5.2 Deposits at call 5.3 Bank overdraft 5.4 Other (provide details)	1,483	2,240
Total: cash at end of quarter(item 1.22)	1,483	2,240

Changes in interests in mining tenements

6.1 Interests in mining tenements relinquished, reduced or lapsed	Tenement reference	Nature of interest (note (2))	Interest at beginning ofquarter	Interest at end of quarter
		N/A

• 6.2 Interests in mining N/A tenements acquired or increased

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

	Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note 3) (cents)
7.1 Preference +securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs, redemptions
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital,buy-backs	316,990,019	316,990,019
7.5 +Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured,converted
7.7 Options (description and conversion factor) 7.8 Issued during quarter	65,697,879 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 115,697,879		Exercise price 0.04 0.04 0.04 0.04 0.045 0.05	Expiry date 31 Jul 2014 31 Jul 2014 31 Jul 2014 31 Jul 2014 31 Jul 2015 31 Jul 2016

7.9 Exercised during quarter 7.10 Expired during quarter
7.11 Debentures (totals only)
7.12 Unsecured notes (totals only)

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).

• 2 This statement does give a true and fair view of the matters disclosed.

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Sign here: (Director)

Date: 30 January 2012

Print name: Richard Poole

Notes

1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities .

4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.

5 Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

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