CULLEN RESOURCES LIMITED — Capital/Financing Update 2011

Apr 20, 2011

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ABN 48 106 732 487

ASX Announcement 21 April 2011

KILLALOE PROJECT FARM-IN AGREEMENT FINALISED

Matsa Resources Limited (ASX:MAT, “Matsa” or the “Company”) is pleased to advise that the agreement with Cullen Resources Limited (“Cullen”) to farm-in to Cullen’s Killaloe Project near Norseman, WA is now unconditional and in accordance with the agreement will issue Cullen with $100,000 worth of Matsa shares.

On 15 December 2010 Matsa announced that it had reached a conditional agreement with Cullen to earn a 70% interest in the Killaloe Project. Each of the conditions has now been met.

The key terms of the farm-in agreement are:

1. Matsa to issue shares to the value of $100,000 at 5 day VWAP to Cullen within 5 business days of satisfaction of the conditions precedent;

2. Matsa to sole-fund $500,000 of exploration costs within 3 years of satisfaction of the conditions precedent (“Farm-in Period”), and to maintain the tenements in good standing throughout the term;

3. Matsa, after incurring a minimum of $100,000 of exploration costs, may elect to withdraw from the agreement within the Farm-in Period without further cost;

4. Following Matsa earning its 70% interest an unincorporated joint venture will be formed with Cullen who may, within 30 business days, elect to convert its 30% interest to a 20% interest free carried until the making of a decision to mine; and

5. Cullen may, within 30 business days of a decision to mine, elect to convert its then joint venture interest into a 2% net smelter return royalty payable on all minerals (any payments in relation to the net profits interest royalty will be an allowable deduction from the obligations of this royalty).

Accordingly Matsa is to issue 342,252 ordinary shares at an issue price of $0.2939 each based on the 5 day VWAP subsequent to the satisfaction of the conditions. An appendix 3B to that effect is attached.

The joint venture would nearly double Matsa’s land holding in the Norseman area and any significant discovery could contribute positively to the economics of Matsa’s Norseman Gold Project .

KILLALOE PROJECT:

The Killaloe Project is a highly prospective, but only partially explored terrain located near the town of Norseman in WA. The Killaloe Project covers around 20 strike kilometres of prospective terrain and includes the Duke, Killaloe, Cashel, Baseline and Peninsular gold prospects, all of which are highly

Head Office: Suite 11, 139 Newcastle Street, Perth Western Australia 6000 Tel : +61 8 9230 3555 Fax : +61 8 9227 0370 Kalgoorlie Office: Suite 1, Vosper House, 31-33 Dugan Street, Kalgoorlie 6430 Tel: +61 8 9021 7200 Fax: +61 8 9021 7277 Bangkok Office: Unit 1808, 2 Pacific Place, Sukhumvit Road, Sukhumvit Bangkok Tel : +66 0 2653 0258 Fax : +66 0 2653 0258 reception@matsa.com.au www.matsa.com.au P a g e | 1

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prospective for structurally controlled gold deposits. At Cashel, a sub-cropping narrow quartz vein with bonanza-grade native gold was discovered by costean. At the Duke Prospect, previous drilling returned 4m @ 5.6g/t Au from 8m depth and several other >1g/t Au intercepts.

The Killaloe Project is a significant area of prospective land which totals 141km[2] and is located between 17 and 32km north east of Norseman and only 30km from Matsa’s Norseman Gold Project. (See Figure 1).

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Figure 1 Location Map

Exploration Results

There is a number of exciting exploration targets within the Killaloe Project including:

Duke

The Duke prospect was discovered by sampling nickel exploration drilling spoils for gold. Some historic significant intersections are detailed below.

• 24m @ 2.15g/t BUX86 from 4 metres

• • 12m @ 1.04g/t NBC4 from 38 metres • 18m @ 1.41g/t GOC5 from 7 metres • 6m @ 1.50g/t CUX25 from 14 metres

• See table 1.

The Duke prospect is a 300[0] trending zone of anomalism measuring 350m x 45m. It has been closed off towards the north and south by ineffective shallow drilling which is unlikely to have reached the supergene zone. Figure 3 shows the down hole maximum value Au assays at Duke.

Killaloe

The Killaloe Prospect area is centred on the historic Killaloe workings where only limited RAB drilling has been completed. Other workings are scattered along a trend over 2,500m long to the north west and

ASX 21 April 2011

MATSA RESOURCES LIMITED

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south east of Killaloe, along which further exploration is warranted. Only 15 RAB holes to an average depth of 20-25 metres have been drilled on the prospect and the prospect is not adequately tested.

Cashel

Soil anomaly with results up to 3,000ppb were followed up with 40 x 20 metres spaced RAB

drilling (Figure 4). The best results include:

• 2m @ 5.83g/t KCR023 from 20 metres

See table 1.

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Figure 2 Prospect Location

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Figure 3 Duke Prospect

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Figure 4 Cashel Prospect

ASX 21 April 2011

MATSA RESOURCES LIMITED

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Paul Poli Executive Chairman

Phone +61 8 9230 3555 Fax +61 8 9227 0370

Email reception@matsa.com.au Web www.matsa.com.au

Competent Persons Statement

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Richard Breyley, who is a Member of the Australasian Institute of Mining and Metallurgy. Richard Breyley is a full time employee of Matsa Resources. Richard Breyley has sufficient experience which is relevant to the style of mineralisation and the type of ore deposit under consideration and 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 Mineral Resources and Ore Reserves. Richard Breyley consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Hole Id	North	East	From	To	**Au_ppm **
BUX86	6463624.43	398123.33	4	24	2.15
NBC4	6463616.14	398102.52	38	50	1.04
GOC5	6463533	398174	7	25	1.41
BUX25	398178.92	6463550.29	13	19	1.50
KCR023	405005	6458423	20	22	5.83
		Including 1m @ 9.4

Table 1 Historic assays

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MATSA RESOURCES LIMITED

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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, 24/10/2005.

Name of entity

MATSA RESOURCES LIMITED

ABN

48 106 732 487

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 issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (eg, if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Ordinary fully paid shares
	340,252
	Ordinary fully paid shares ranking equally with existing ordinary fully paid shares

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 1

4 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 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 7 Dates of entering +securities into uncertificated holdings or despatch of certificates 8 Number and +class of all +securities quoted on ASX (including the securities in clause 2 if applicable)	Yes	Yes
	29.39 cents per share (5 day VWAP)
	Issue of shares to farm-in to Killaloe Project
	21 April 2011
	Number	+Class
	122,351,215	Fully Paid Ordinary Shares

9 Number and +class of all +securities not quoted on ASX (including the securities in clause 2 if applicable)	Number	+Class
	7,800,000 9,000,000 2,000,000 1,200,000 2,300,000 4,250,000	Unlisted Options exercisable at $0.35 each expiring 1 July 2011 Unlisted Options exercisable at $0.50 each expiring 1 July 2012 Unlisted Options exercisable at $0.273 each expiring 26 November 2012 Unlisted ESOP Options exercisable at $0.273 each expiring 31 December 2012 Unlisted ESOP Options exercisable at $0.40 each expiring 31 August 2013 Unlisted Options exercisable at $0.45 each expiring 30 November 2013

10 Dividend policy (in the case of a No dividend policy has been established. trust, distribution policy) on the increased capital (interests)

Part 2 - Bonus issue or pro rata issue

11 Is security holder approval required? 12 Is the issue renounceable or nonrenounceable? 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?

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 3

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
	Note: Security holders must be told how their
	entitlements are to be dealt with.
	Cross reference: rule 7.7.
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
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

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

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 5

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 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 42 Number and +class of all +securities quoted on ASX ( including the securities in clause 38)

+Class

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.

• 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.

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Sign here: ............................................................ Date: 21 April 2011 ( ~~Director/~~ Company secretary) Print name: Andrew Chapman == == == == ==

• See chapter 19 for defined terms.

24/10/2005 Appendix 3B Page 7

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ABN 48 106 732 487

ASX Announcement

21 April 2011

Company Announcements Office Australian Securities Exchange Limited (‘ASX’)

MATSA RESOURCES LIMITED (ASX Code: MAT)

SECONDARY TRADING NOTICE PURSUANT TO SECTION 708A (5) (e) OF THE CORPORATIONS ACT 2001

Matsa Resources Ltd (‘Company’) gives this notice pursuant to section 708A (5) (e) of the Corporations Act 2001 (Cth) (‘Act’).

The Company has issued 340,252 fully paid ordinary shares.

The Company advises that the Shares were issued without disclosure to investors under Part 6D.2 of the Act. The Company, as at the date of this notice has complied with:

• (a) the provisions of Chapter 2M of the Act as they apply to the Company; and

• (b) Section 674 of the Act.

As at the date of this notice there is no information that is excluded information for the purposes of sections 708A (7) and (8) of the Act.

Yours sincerely

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Andrew Chapman Company Secretary

Head Office: Suite 11, 139 Newcastle Street, Perth Western Australia 6000 Kalgoorlie Office: Suite 1, Vosper House, 31-33 Dugan Street, Kalgoorlie 6430 Bangkok Office: Unit 1808, 2 Pacific Place, Sukhumvit Road, Sukhumvit Bangkok reception@matsa.com.au www.matsa.com.au

Tel : +61 8 9230 3555 Fax : +61 8 9227 0370 Tel: +61 8 9021 7200 Fax: +61 8 9021 7277 Tel: +66 0 2653 0258 Fax: +66 0 2653 0258 P a g e | 1