CAZALY RESOURCES LIMITED — Capital/Financing Update 2011

May 18, 2011

ASX ANNOUNCEMENT

CAZALY RESOURCES Limited

HAMERSLEY IRON PROJECT AGREEMENT

OPTION AGREEMENT WITH WINMAR RESOURCES TO ACQUIRE 100% OF THE HAMERSLEY IRON PROJECT

Cazaly Resources Limited (ASX: CAZ, “Cazaly”) advise, it’s wholly owned subsidiary, Cazaly Iron Pty Ltd (Cazaly Iron), has executed an agreement with Winmar Resources Limited (ASX:WFE), to vary the Farm-in Heads of Agreement dated 18 October 2010 (Variation Agreement) in relation to the Hamersley Iron Ore Project. Winmar is currently earning into a 51% interest in the tenements the subject of the Farm-in Heads of Agreement and has an exclusive option to acquire the remaining 49% from Cazaly Iron. Pursuant to the Variation Agreement, Cazaly Iron has agreed to grant Winmar an option to acquire an immediate 100% interest in the tenements for an exercise price of $35 million and the grant of a royalty. Winmar will pay an option fee of $100,000 for a two month option period. The option may be extended for a further on month at Winmar’s election subject to the payment of a further $100,000.

The grant of the option is subject to the parties obtaining a written opinion from ASX that approval will not be required under Listing Rule 10.1. On exercise of the option, Winmar will have acquired a 100% ownership interest in the Hamersley Iron Project in the Pilbara Region of Western Australia.

For further information please contact:

Nathan McMahon/ Clive Jones Joint Managing Directors Cazaly Resources Limited Tel: +618 9380 4600 Em: admin@cazalyresources.com.au

David Tasker

Professional Public Relations Tel: +618 9388 0944/ +61 433 112 936 Em: david.tasker@ppr.com.au

Website: www.cazalyresources.com.au

Level 2, 38 Richardson Street, West Perth, Western Australia, 6005. PO Box 396, West Perth, Western Australia, 6872 Phone: +61 8 9322 6283 Fax: +61 8 9322 6398 email: admin@cazalyresources.com.au ACN 101 049334 www.cazalyresources.com.au