BROOKSIDE ENERGY LIMITED — Capital/Financing Update 2011

Jan 24, 2011

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 1/7/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003.

Name of entity

Red Fork Energy Limited

ABN

15 108 787 720

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

• 1 +Class of +securities issued or to be Converting Notes ( Notes ) issued

• 2 Number of[+] securities issued or to Forty (40) be issued (if known) or maximum number which may be issued

• See chapter 19 for defined terms.

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3 Principal terms of the +securities Upon conversion, the Noteholder will be entitled (eg, if options, exercise price and to ordinary fully paid shares in the Company expiry date; if partly paid +securities, the amount outstanding ( Shares ), calculated at the lesser of: and due dates for payment; if (a) $0.35 per Share; or +convertible securities, the conversion price and dates for (b) 85% multiplied by the issue price conversion) further Shares issued by the Company.

• (b) 85% multiplied by the issue price of further Shares issued by the Company.

The Notes will be automatically converted on the earlier of:

• i. 6 months from the date of issue; or

• ii. the issue of any further Shares by the Company; and

• upon the receipt of shareholder approval if the number of Shares to be converted exceeds the number of securities the Company is able to issue without shareholder approval under ASX Listing Rule 7.1, ( Conversion Date ).

4 Do the[+] securities rank equally in all No, however upon conversion of the Notes into respects from the date of allotment ordinary fully paid shares, the allotted and issued with an existing +class of quoted shares will rank equally in all respects with an +securities? existing class of quoted securities. The Notes do not entitle the holder to participate in the next If the additional securities do not dividend or interest payment. rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration A$100,000 per Note

5 Issue price or consideration A$100,000 per Note 6 Purpose of the issue To fund the drilling, completion and testing of (If issued as consideration for the horizontal wells in the Big River Project. acquisition of assets, clearly identify those assets)

• 7 Dates of entering[+] securities into uncertificated holdings or despatch 11 January 2011 and 24 January 2011 of certificates

Number Class 8 Number and +class of all 139,535,000 Fully Paid Ordinary +securities quoted on ASX Shares ( including the securities in clause 2 if applicable)

• See chapter 19 for defined terms.

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9 Number and +class of all +securities not quoted on ASX (including the securities in clause 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Number	+Class
	40 7,165,000 708,333 1,800,000 708,333 1,800,000 295,500 1,800,000 1,600,000 1,800,000 2,400,000 1,587,000	Converting Notes Options – ($0.30, 30 April 2011) Options – ($0.35, 30 June 2014) Options – ($0.40, 30 April 2012) Options – ($0.45, 30 June 2014) Options – ($0.50, 30 April 2013) Options – ($0.60, 31 July 2012) Options – ($0.65, 30 April 2014) Options – ($0.65, 30 June 2014) Options – ($0.80, 30 April 2015) Options – ($1.00, 30 April 2016) Options – ($1.20, 30 November 2014)
	Not Applicable

• See chapter 19 for defined terms.

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Part 2 - Bonus issue or pro rata issue

11	Is security holder approval
	required?
12	Is the issue renounceable or non-
	renounceable?
13	Ratio in which the +securities will
	be offered
14	+Class of +securities to which the
	offer relates
15	+Record date to determine
	entitlements
16	Will holdings on different registers
	(or subregisters) be aggregated for
	calculating entitlements?
17	Policy for deciding entitlements in
	relation to fractions
18	Names of countries in which the
	entity has +security holders who
	will not be sent new issue
	documents
19	Closing date for receipt of
	acceptances or renunciations
20	Names of any underwriters
21	Amount of any underwriting fee or
	commission
22	Names of any brokers to the issue
23	Fee or commission payable to the
	broker to the issue
24	Amount of any handling fee
	payable to brokers who lodge
	acceptances or renunciations on
	behalf of +security holders

• See chapter 19 for defined terms.

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25	If the issue is contingent on
	+security holders’ approval, the date
	of the meeting
26	Date entitlement and acceptance
	form and prospectus or Product
	Disclosure Statement will be sent to
	persons entitled
27	If the entity has issued options, and
	the terms entitle option holders to
	participate on exercise, the date on
	which notices will be sent to option
	holders
28	Date rights trading will begin (if
	applicable)
29	Date rights trading will end (if
	applicable)
30	How do +security holders sell their
	entitlements in full through a
	broker?
31	How do +security holders sell part
	of their entitlements through a
	broker and accept for the balance?
32	How do +security holders dispose
	of their entitlements (except by sale
	through a broker)?
33	+Despatch date

• See chapter 19 for defined terms.

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Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

34 Type of securities ( tick one )

• (a) Securities described in Part 1

• (b) All other securities

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

• 36 If the +securities are +equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

• 37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

• 38 Number of securities for which +quotation is sought

• 39 Class of +securities for which quotation is sought

• See chapter 19 for defined terms.

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40 Do the[+] securities rank equally in all respects from the date of allotment with an existing +class of quoted +securities? If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another security, clearly identify that other security) Number +Class 42 Number and[+] class of all[+] securities quoted on ASX ( including the securities in clause 38)

• See chapter 19 for defined terms.

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Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted[+] quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any +securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• We warrant that if confirmation is required under section 1017F of the Corporations Act in relation to the[+] securities to be quoted, it has been provided at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before[+] quotation of the[+] securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here: Date: 24 January 2011

(Company Secretary)

Print name: Suzie Foreman

• See chapter 19 for defined terms.

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