CASSIUS MINING LIMITED — Interim / Quarterly Report 2011

Jul 28, 2011

29 JULY 2011

==> picture [166 x 86] intentionally omitted <==

ASX ANNOUNCEMENT

FOURTH QUARTER ACTIVITIES REVIEW

Gulf Industrials Limited (“Gulf” or “the Company”) (ASX Code: GLF), is pleased to provide shareholders with the Activity Review for the quarter ending 30 June 2011.

HIGHLIGHTS

• Successful $2.88 million (before expenses) raising to clients of Veritas Securities Limited.

• Increase in Namekara mining lease along with planned exploration and drilling programme.

• All resolutions approved at the General Meeting of shareholders held on 19 April 2011.

SUBSEQUENT TO QUARTER END

• Mr Rob Guest appointed as Manager, East African Operations based in Uganda and will commence on 1 August 2011.

• Fully underwritten non‐renounceable rights issue announced to raise approximately $11.85 million (before expenses).

NAMEKARA VERMICULITE MINE

Operation Update

Production for the quarter totaled 2,218t which was marginally above forecast. Drying of plant feed continues to be the bottleneck however this will be overcome with the installation of a new drier. The new drier has been delivered to site and is currently being installed. Production is forecast to be 3,000t during the quarter ended 30 September 2011 and will ramp up to 2,500t per month during the fourth quarter.

Sales & Production Summary

	Sep Qtr2010	Dec201	Qtr0	Mar Qtr2011	Jun Qtr2011		Year
Quarterly Sales(tonnes)	900	1,44	0	1,914	2,942		7,196
Quarterly Production(tonnes)	1,124	1,35	1	2,247	2,218		6,940

Level 10 Gold Fields House 1 Alfred Street Sydney NSW 2000 ● PO Box R745 Royal Exchange NSW 1225 Australia

t +61 2 8247 5333 ● f +61 2 9247 7722

ACN 115 027 033

www.gulfindustrials.com.au

‐ 2 ‐

Production

The majority of equipment required for the upgrade to 30,000tpa has been delivered to site and construction and commissioning work continues, with completion planned by 30 September 2011. An additional track dozer and excavator were delivered to site in July and will assist in the mining operations.

Marketing

During the quarter, the market for vermiculite continued to improve. Of specific relevance is the shortfall in supply in the coarser grades, where the Namekara product is and will continue to fill market demand.

Sales for the quarter were 2,942t which was an increase of 1,028t over the previous quarter sales of 1,914t.

Human Resources

During this period the management team was further strengthened with the appointment of Rob Guest as Manager, East African Operations, who will commence on 1 August 2011 and will be based in Uganda. Rob brings significant project and operational experience in construction, mining and processing to the team and has a track record of delivery in remote environments.

On mine, key positions of diesel mechanic and geologist were filled.

Political, Social, Environmental, Safety & Health Matters

No major community, social, safety and health were reported, and the operations remain fatality and lost time injury free.

Work continued with the social and environmental management planning and other related aspects for inclusion in the feasibility studies for further expansion of the operations at Namekara.

Resource & Exploration Geology

Exploration during the quarter was focused on a review and re‐evaluation of the exploration potential over the carbonatite, as well as the planning for the resource drilling program within the mining lease. The drilling program will commence in the October 2011 quarter.

Level 10 Gold Fields House 1 Alfred Street Sydney NSW 2000 ● PO Box R745 Royal Exchange NSW 1225 Australia t +61 2 8247 5333 ● f +61 2 9247 7722

ACN 115 027 033

www.gulfindustrials.com.au

‐ 3 ‐

Gulf’s Mining and Exploration Leases

==> picture [350 x 248] intentionally omitted <==

Namekara Mining Lease

During the quarter, the Company commenced an exploration programme covering its existing and new Ugandan exploration tenements.

Expanded Mining Lease

The revised mining lease over the Company’s producing Namekara Vermiculite Mine includes an old phosphate mine and extended vermiculite showings as identified during Gulf’s on‐ going exploration activities. The expanded mining lease now covers an area of 19.5 km².

Gulf CEO Vic Fitzmaurice said, “with the 55Mt JORC Inferred Resource, Namekara is one of the world’s largest vermiculite resources, skewed towards a coarser grade of mineral. The expansion of the mining lease ensures that Gulf is strategically placed to become one of the world’s leading vermiculite producers, contributing to a reduction in the current market supply shortfall.”

“Our approach of reviewing the potential for increased production from our existing resource, as well as the exploration and drilling program on our mining lease and exploration tenements means that we move one step closer to realising the full potential of Namekara.”

Gulf’s Exploration Program

Following a review of the Company’s exploration efforts in Uganda, the Board approved a program covering all of the Company‐held tenements in Uganda, including the expanded Namekara mining lease area with an aim to increase the current resource and improve its JORC classification.

Level 10 Gold Fields House 1 Alfred Street Sydney NSW 2000 ● PO Box R745 Royal Exchange NSW 1225 Australia t +61 2 8247 5333 ● f +61 2 9247 7722 ACN 115 027 033

www.gulfindustrials.com.au

‐ 4 ‐

The exploration programme on the Namekara Mining Lease will underpin the Company’s objective to increase output to 130,000tpa over the next few years, which will be underpinned by feasibility studies to be concluded in the near future.

In addition to the planned exploration program over the mining lease, the Company plans to extend its exploration activities on the Carbonatite complex to the exploration leases surrounding the mine.

Vic Fitzmaurice continued, “The Company notes that the area is also considered highly prospective for phosphate and other associated minerals in the Carbonatite complex, and we want to ensure the mineral potential from these mining and exploration leases.”

With production increasing to 30,000tpa from 1 October 2011 from our existing resource, as well as the planned exploration program on the expanded mining and exploration leases, we move one step closer to realising the full potential of Namekara.

Chairman, Sir Sam Jonah added that the Board is excited about the potential prospectivity for copper, phosphate and related minerals contained in the Carbonatite complex covered by Gulf’s surrounding leases. “Some time ago we realised the potential for increased vermiculite, phosphate and other related minerals at Namekara. We look forward to extending the exploration programme over all our tenements in Uganda and to develop the potential for our shareholders.”

MADAGASCAR OPERATIONS – SOALARA LIMESTONE PROJECT

The planning and evaluation of the Soalara project to maximize shareholder return continued.

CORPORATE

Placement of 64 Million Shares Raises $2.88 Million

The Company successfully placed 64,000,000 shares at $0.045 per share to clients of Veritas Securities Limited to raise a total of $2.88 million (before expenses).

The funds raised are being utilised for the development of the Namekara Mine project and for working capital purposes.

General Meeting of Shareholders Results in Approval of all Resolutions

An extraordinary general meeting of the Company was held on 19 April 2011 where all resolutions considered by shareholders were duly passed.

Level 10 Gold Fields House 1 Alfred Street Sydney NSW 2000 ● PO Box R745 Royal Exchange NSW 1225 Australia t +61 2 8247 5333 ● f +61 2 9247 7722

ACN 115 027 033

www.gulfindustrials.com.au

‐ 5 ‐

SUBSEQUENT TO QUARTER END

Appointment of Country Manager Uganda

Gulf announced the appointment of Mr Rob Guest as Manager, East African Operations commencing on 1 August 2011.

$11.85 Million Non‐Renounceable Rights Issue

The company is currently undertaking a 3 for 5 non‐renounceable pro‐rata rights issue of ordinary shares at 4 cents per share to shareholders to raise approximately $11.85 million and is fully underwritten by Veritas Securities Limited and Ocean Equities Limited.

Funds raised from the issue will be applied to final payment for the Namekara vermiculite mine, a drilling program, mine expansion and associated feasibility study, along with associated offer costs and working capital.

The three largest shareholders of the Company being African Lion 3 Limited, Jonah Capital Limited and Contango Asset Management Limited representing 36% of the issued capital, have advised that they intend to subscribe for their full entitlement under the rights issue.

FURTHER INFORMATION

Vic Fitzmaurice, CEO Wayne Kernaghan, Company Secretary

t | +27 72 778 8889 t | +61 2 8247 5333

COMPETENT PERSONS STATEMENT

The information in this report that relates to Mineral Resources is based on information compiled by HennieTheart, BSc (Hons), MSc, PhD, Pr. Sci. Nat (SACNASP 400069/88), FSEG, FGSSA, FAAG; Shaun Crisp, BSc (Hons), Pr.Sci.Nat. (SACNASP 400076/09); and Brent Barber, BSc (Hons), MPhil, AusIMM (222559), AAPG (59319‐8).

HennieTheart and Shaun Crisp are registered with the South African Council for Natural Scientific Professions (SACNASP), a JORC Recognised Overseas Professional Organisation "ROPO" and Brent Barber is a member of the Australasian Institute of Mining and Metallurgy (AusIMM). They are full‐time employees of SRK Consulting and have experience which is relevant to the style of mineralisation, type of deposits under consideration and to the activity which they have undertaken, to qualify them as a Competent Persons, as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves'.

HennieTheart, Shaun Crisp and Brent Barber consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.

The information in this release that relates to the Exploration Process is based on information compiled by A Johnstone who is a member of the Australian Institute of Geoscientists (AIG). Andrew Johnstone provides exploration management consulting services to Gulf Industrials Ltd and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which Andrew Johnstone has undertaken 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'.

Andrew Johnstone consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Level 10 Gold Fields House 1 Alfred Street Sydney NSW 2000 ● PO Box R745 Royal Exchange NSW 1225 Australia t +61 2 8247 5333 ● f +61 2 9247 7722

ACN 115 027 033

www.gulfindustrials.com.au