APOLLO MINERALS LIMITED — Capital/Financing Update 2012

Jun 24, 2012

25 June 2012

ASX ANNOUNCEMENT

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Apollo Delivers Maiden 72 Mt Resource at Commonwealth Hill

Highlights

ASX Code: AON

• Total Resource of 72 Mt @ 25.9% Fe including:

ABOUT APOLLO MINERALS

Apollo Minerals is an iron ore explorer and developer with two key projects in the Australian iron ore provinces of the Pilbara (Western Australia) and Gawler Craton (South Australia) and a third in Gabon, Africa. Apollo’s South Australian tenements are also highly prospective for base and precious metals.

Apollo’s projects are well situated close to infrastructure including railways and ports.

Capital Profile

Shares on issue 269.9m Options on issue 60.5m Market Cap $11m

• Indicated Resource of 19.4 Mt @ 27.7% Fe, and

• Inferred Resource of 52.6 Mt at 25.3% Fe

• Initial JORC-compliant Mineral Resource defined at Sequoia, the smallest of four primary iron targets at the Commonwealth Hill Iron Project, South Australia

• Higher grade Resource of 5.4 Mt @ 38.9% Fe contained within larger mineral resource

• Mineralisation outcrops over a 1.2 km strike length and remains open at depth, along strike and to the east

• Updated Sequoia Exploration Target[1] of 100 - 150 Mt between 25% - 35% Fe

• Pit optimisation and scoping studies are now underway

Iron Ore Projects

Commonwealth Hill South Australia Mount Oscar Western Australia Kango North Gabon

Base and Precious Metals Project

Titan South Australia

Apollo Minerals Limited ABN 96 125 222 924 50 Margaret Street Sydney NSW 2000 T: +61 2 9078 7670 F: +61 2 9078 7661 E: info@apollominerals.com.au

Contact

Richard Shemesian Apollo Minerals Ltd T: +61 2 9078 7660

INTRODUCTION

Apollo Minerals Limited (ASX: AON) (“Apollo” or “the Company”) is pleased to announce its maiden JORC Resource estimate of 72 Mt @ 25.9% Fe (Table 1) at the Sequoia deposit, the smallest of four primary iron targets, on its wholly-owned Commonwealth Hill Iron Project (CHIP) in South Australia. This initial Resource estimate includes a higher grade resource core of 5.4 Mt @ 38.9% Fe (using a 37% Fe cut-off grade).

The Sequoia deposit is located approximately 20 km west of the planned Gina rail siding, located 100 km south of Coober Pedy in South Australia.

Tony Dawe Investor Relations T: +61 8 9388 0944 www.apollominerals.com.au

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25 June 2012

ASX ANNOUNCEMENT

This new JORC- compliant estimate represents a 227% increase on the historic mineral resource of 22 Mt @ 28.4 % Fe (first 100m below the estimated base of oxidation at 45m) reported in February 1997. Apollo has now updated the Sequoia Exploration Target¹ to a range between 100 - 150 Mt grading between 25 - 35% Fe. Apollo is confident of increasing the Resource at Sequoia and adding to the project resource base with the as yet undrilled, Ibis prospect (Figure 3).

Chief Operating Officer Dominic Tisdell said, “ This important project milestone has exceeded our expectations and forms a strong foundation for the development of the Commonwealth Hill Iron Project. Importantly the Company now has the resource base to commence initial mine development plans and articulate our development strategy to investors. The next twelve months will see the Company continue its transformation from explorer to developer."

Table 1: Indicated and Inferred Mineral Resource estimate for the Sequoia Deposit classified in accordance with the (2004) JORC code.

Total Mineral Resource	Total Mineral Resource	Total Mineral Resource	Total Mineral Resource	Total Mineral Resource	Total Mineral Resource	Total Mineral Resource	Total Mineral Resource	Total Mineral Resource
Type	Cut-off	Tonnes	Fe	SiO2	Al2O3	P	S	LOI
	Fe %	mt	%	%	%	%	%	%
Oxide	15	20.6	25.8	45.9	6.5	0.06	0.07	2.3
Fresh	15	51.4	26.0	46.9	5.9	0.06	0.11	0.9
Total	15	72.0	25.9	46.6	6.1	0.06	0.10	1.3
Indicated Mineral Resource
Type	Cut-off	Tonnes	Fe	SiO2	Al2O3	P	S	LOI
	Fe %	mt	%	%	%	%	%	%
Oxide	15	0	0	0	0	0	0	0
Fresh	15	19.4	27.7	46.0	5.3	0.06	0.12	0.5
Total	15	19.4	27.7	46.0	5.3	0.06	0.12	0.5
Inferred Mineral Resource
Type	Cut-off	Tonnes	Fe	SiO2	Al2O3	P	S	LOI
	Fe %	mt	%	%	%	%	%	%
Oxide	15	20.6	25.8	45.9	6.5	0.06	0.07	2.3
Fresh	15	32.1	24.9	47.5	6.3	0.07	0.09	1.2
Total	15	52.6	25.3	46.8	6.4	0.06	0.09	1.6

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25 June 2012

ASX ANNOUNCEMENT

OVERVIEW

The Sequoia iron mineralisation outcrops, extends for 1.2km along strike and has an average true width of approximately 150m. Mineralisation remaining open along strike and at depth (Figure 1) with the maiden Mineral Resource modelled to an average depth of approximately 175m below surface. Drilling has returned intersections of up to 114m @ 38.4% Fe (Hole SE012, Figure 2). The actual size of the Resource has the potential to increase with further drilling at depth, along strike and to the east where a new mineral unit was discovered.

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Figure 1: Sequoia gravity image (GGRAV BA L) showing drilling and Figure 2 cross section line

49% of the sampling from historic drilling was composited and assayed over non-standard intervals of up to 20m. These intervals are being re-assayed at a standard length of 2m. An updated Mineral Resource statement based on these re-assayed samples is expected in Quarter 3 2012.

The new Mineral Resource block model will now be evaluated to assess the likely in-pit mineral inventory and optimised as part of a scoping study which is expected to be completed in Quarter 3, 2012.

A diamond core drill programme is currently being planned to obtain further whole rock samples for metallurgical test work with the aim of evaluating the potential to produce low cost, dry magnetic separated (DMS) iron products from the fresh rock mineralisation at grades of circa 60% Fe.

Work is currently being conducted to assess the size and quality for the next phase of exploration, with a particular focus on developing the larger scale Ibis Prospect, situated 25 km west of Sequoia (Figure 3). An update on the next phase of exploration is expected during Quarter 3, 2012.

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25 June 2012

ASX ANNOUNCEMENT

Figure 2: Cross section of Sequoia Deposit (6,693,500 mN)

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Figure 3: Commonwealth Hill magnetic image (AMAG TMI RTP) showing iron ore resources and prospects

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25 June 2012

ASX ANNOUNCEMENT

SEQUOIA RESOURCE MODELLING DETAILS

The maiden Sequoia Mineral Resource estimate was classified as containing both Indicated and Inferred Mineral Resources based on the guidelines of the (2004) JORC code and reported using a 15% Fe cut-off grade.

The Mineral Resource was estimated by Widenbar and Associates Pty Ltd based on geological data provided by the Company. Drill hole information was compiled from 22 drill holes for a total of 3,107 m comprising 21 reverse circulation (RC) holes and 1 diamond drill hole completed by March 2012 (Figure 4). Drill hole data was validated, interpreted and then modelled using MicroMine software.

The Mineral Resource estimate covers a 1.2 km strike length, an average width of 150 m and is interpreted to an average vertical depth of 175 meters (Figure 4) .

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Figure 4: Block model sections of Sequoia JORC code compliant resource displaying Fe grade

Ordinary kriging was applied to the mineral where the search ellipsoid was orientated in the plane of the mineralisation. A parent block size measuring 10 m by 25 m by 5 m (X, Y, Z) was selected for grade interpolation with sub-cells used to accurately model the mineralisation. The dimensions of the search ellipse were based on the relevant geo-statistical variogram ranges. An oxidation boundary has been interpreted by reference to the geological logging and meter by meter magnetic susceptibility logging. Bulk densities of 2.9 t/m[3] and 3.2 t/m[3] were used for the oxide and fresh mineralisation zones respectively.

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25 June 2012

ASX ANNOUNCEMENT

SEQUOIA EXPLORATION TARGET

A further Exploration Target[1] of an addition 28 – 78 Mt grading 25 – 35% Fe has been defined at Sequoia. This is in addition to the initial Mineral Resource of 72 Mt @ 25.9% Fe (using a 15% Fe cutoff grade), and if realised, would yield a mineral inventory at Sequoia of 100 – 150 Mt @ 25 – 35% Fe.

This Exploration Target[1] is based on a reconciliation of the initial Mineral Resource estimate against

magnetic and gravity geophysical models (Figures 5 & 6) and is possibly accurate to +/25%. However, they should be considered accurate to +/50% for planning purposes and are broadly indicative at best.

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Iron mineralisation units
Drill hole(s)
Inferred +1.6 t / m [3] gravity zone
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Figure 5: 3D schematic showing Sequoia iron mineralisation units and inferred 1.6 t / m3 gravity zone (looking NW)

Apollo is currently reviewing the exploration potential of its other major iron prospects (Figure 3) within the CHIP and expects to make an announcement on this matter during Quarter 3, 2012.

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Base of oxidisation
[+1.6 t / m][3][ gravity zone ]
+0.6 t / m [3] gravity zone
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Figure 6: 3D schematic showing Sequoia iron mineralisation units, base of oxidation surface and inferred 0.6 t / m3 and 1.6 t / m3 gravity zones (looking north)

25 June 2012

ASX ANNOUNCEMENT

NOTES:

1The estimates of Exploration Target sizes mentioned in this release should not be misunderstood or misconstrued as estimates of Mineral Resources. The estimates of Exploration Target sizes are conceptual in nature and there has been insufficient results received from drilling completed to date to estimate a Mineral Resource compliant with the JORC Code (2004) guidelines. Furthermore, it is uncertain if further exploration will result in the determination of a Mineral Resource.

SIGNIFICANT INDUSTRY SHAREHOLDERS

CHINA ARMCO METALS

China Armco Metals, Inc. (“China Armco”), a 10.8% shareholder in Apollo, imports and distributes a variety of metal ores and scrap to the metal refining industry in the People's Republic of China.

China Armco’s products include iron ore, coal, chrome ore, nickel ore, copper ore, scrap metal and manganese ore.

In March 2010, China Armco began operating a scrap metal recycling facility in the Jiangsu province of the People's Republic of China.

JINDAL STEEL & POWER

Apollo has recently welcomed India’s third largest steel producer Jindal Steel and Power Limited (“JSPL”) as a substantial shareholder having taken a 9.25% stake in the Company as part of its recent capital raising.

JSPL is a $16.7 billion Indian steel and energy company based in New Delhi, India and a division of Jindal Group conglomerate.

The company manufactures and sells sponge iron, mild steel slabs, ferro-chrome, iron ore, mild steel, structural, hot rolled plates and coils and coal-based sponge iron plant.

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25 June 2012

ASX ANNOUNCEMENT

CAPITAL MANAGEMENT

Apollo is in a strong financial position after completing a placement to institutional and sophisticated investors raising $3.6 million, which includes the initial investment from JSPL.

Proceeds will be used for the exploration and development of CHIP as the Company continues to work on advancing the asset towards production.

FOR FURTHER INFORMATION CONTACT:

Richard Shemesian

Executive Director

Apollo Minerals Limited

Dominic Tisdell Chief Operating Officer Apollo Minerals Limited

info@apollominerals.com.au Tel: +61 2 9078 7660

Media and Investor Enquiries:

Tony Dawe

Investor Relations

Email: tony.dawe@ppr.com.au

Tel: +61 8 9388 0944

COMPETENT PERSON DECLARATION

The information in this Report that relates to Mineral Resources and Exploration Results is based on information compiled by Mr Derek Pang who is a member of the Australasian Institute of Mining and Metallurgy. Derek has over 15 years’ experience in mineral exploration and is a full time employee of Apollo Minerals Ltd. Derek has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Derek consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

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25 June 2012

ASX ANNOUNCEMENT

ABOUT APOLLO’S PROJECTS

Apollo Minerals Ltd (ASX Code: AON) is an iron ore and minerals explorer and developer with projects in South Australia, Western Australia and Gabon, western Central Africa. The Company’s key focus is to develop an iron ore project at each of Apollo’s project sites, namely the Gawler Craton, SA, the Pilbara, WA and Gabon, Africa.

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The Commonwealth Hill site lies on the northwest margin of the Gawler Range Volcanics Domain, where the older basement rocks are interpreted as Archaean gneisses of the Mulgathing Complex, which are intruded by late syntectonic granitoids of Palaeoproterozoic age. In the southeast of the Project, Mesoproterozoic Gawler Range Volcanics overlie the older basement and coeval Hiltaba Suite granitoids intrude both the volcanics and the older basement. Major northwest and northeast trending fault structures are evident from aeromagnetic data.

Apollo is currently evaluating the

potential to develop a medium sized iron mine on the property. Drilling has identified both coarse grained magnetite and Direct Shipping Ore (DSO) style mineralisation including 66m at 38% from 18 m in SE013; 24m at 41% Fe from 4 m in SE010 on the Sequoia Prospect, and 24m at 56% Fe inclusive of 4m at 70% Fe from 20 m in SAT004 on the St Andrews Prospect. Previous work has highlighted the possibilities of producing premium quality iron concentrates and sinter fines products.

The Mt Oscar Iron Project is located in north-western part of the Pilbara Craton in north-west Western Australia, and is approximately 30 km from the coast. The magnetite-bearing rocks at Apollo’s Mt Oscar Project outcrop over an oval shaped area measuring some 5km by 2km. The iron rich horizons are strike-continuous for up to 5.5km and are locally up to 160m thick with an average interpreted thickness in excess of 60m. Recent metallurgical work has demonstrated that the production of marketable products is possible i.e. >60% Fe, <8% (Al2O3 + SiO2).

Apollo’s Kango North licence area in Gabon largely comprises rocks of the northern portion of the Archaean craton in the region, known as the North Gabon Massif. Supra-crustal remnants contain elements of the Belinga Group (2870 Ma – 2750 Ma). These rocks are known to host a number of iron ore deposits and occurrences within Gabon and neighbouring countries including Belinga, M’Bilan, Mbalam, Avima, Kango, Zanaga, Mayoko and Mayoko-Moussondji. Apollo management believes that the Kango North licence area is highly prospective for iron ore and other metals including gold and platinum-group elements.

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