ELEMENTOS LIMITED — Interim / Quarterly Report 2011

Jan 30, 2011

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31 JANUARY 2011

QUARTERTLY REPORT DECEMBER 2010

Highlights

• High-grade ore system delineated in Manantiales drilling program

• Gold-copper porphyry mineralised system identified at Divisoria

• Silver-polymetallic vein system discovered at Yvette

• Placements to strategic investors and non-renounceable rights issue to existing investors totalling $7.2 million

Elementos Limited (ASX: ELT) (“Elementos” or the “Company”) quarterly exploration activities were concentrated on the Manantiales gold-silver project and the Santo Domingo gold-copper porphyry and Yvette silver and base metal vein system.

MANANTIALES

2010 Drilling Results

During the quarter the company received the results of the inaugural Manantiales diamond drilling program. The highlights include the intersection of a high-grade gold zone with silver credits from approximately 49 metres below surface. The mineralised system appears to have a minimum strike length of 80 metres in a northsouth direction, widths ranging between 4.5 to 12.5 metres and is open along strike and to depth. The Company believes there is potential for a larger epithermal system at depth.

The diamond drilling program was completed in September 2010 and comprised 19 diamond holes for a total 1,635.67 metres:

• Manantial vein - 15 holes totalling 1,383.02 metres; and,

• Julietta Norte - 4 holes totalling 252.65 metres.

The program was designed to test the Manantial vein, where high-grades were reported from channel sampling at surface, at depths of between 30 and 110 metres below the surface.

The deeper diamond core holes, MDH019, MDH014 and MDH002, intersected significant widths of high-grade gold with silver credits. Significant intersections within the high grade zone include:

• MDH019 - 12.6m at 5.04 g/t gold and 37 g/t silver from 82.78m

Incl. 5.2m at 11.3g/t gold and 65g/t silver from 83.4m

Incl. 0.7m at 57.4 g/t gold and 350 g/t silver from 85.3m

Incl. 0.73m at 13.8 g/t gold and 73 g/t silver from 87.15m

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• MDH014 – 8.34m at 3.07g/t gold and 6g/t silver from 94.2m

Incl. 3.4m at 6.53 g/t gold and 12 g/t silver from 99.2m

Incl. 0.7m at 19.4 g/t gold and 28 g/t silver from 99.2m

This high-grade mineralisation appears to have a minimum length of 80 metres, widths ranging between 4.5 to 12.5 metres, and is still open along strike and to depth.

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Figure 1 : Manantial vein longitudinal section demonstrating high grade

The shallower holes were typically lower grade than the surface channel sample results; however, it is not known if this is due to the drill spacing missing potential lenses or a possible vertical control on the mineralisation in the system.

Julieta Norte Drilling Results

MDH015, MDH016, MDH017 and MDH018 tested the structure over 175 metres of discrete pinching and swelling vein in outcrop, at shallow levels. The northernmost hole, MDH016, returned 1.02 metres at 4.4 g/t gold and 16 g/t silver from 29.73 metres. MDH017 returned 0.75 metres at 4.8 g/t gold and 7 g/t silver from 62.9 metres.

Since the vein has been mapped in outcrop to the north of MDH016 and the geochemical signatures are similar to Troy’s Julieta vein, drill testing to greater depth is planned during the next phase of drilling.

2011 Drilling Program

The follow-up program will involve further drilling and the continuation of the regional exploration program currently underway.

The second drill program, in early 2011, will be aimed at:

• Testing extensions of high-grade mineralisation along strike and to depth at the Manantial vein;

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• Second-pass drilling to check extensions along strike and to test deeper levels of the Julieta Norte vein; and,

• Exploratory drilling of the untested La Puerta vein system.

Project-scale exploration is continuing with the aim of identifying new targets for drilling. The initial focus is to sample potential extensions of the La Puerta vein system, plus a new vein system identified 600 metres east of La Puerta. Target generation will first cover the five kilometres of untested ground between the La Puerta and Julieta Norte veins, and gradually work northwards towards the Manrique prospect.

SANTO DOMINGO

Two significant advances were made at Santo Domingo during the quarter: the discovery of a mineralised gold-copper porphyry system at the Divisoria prospect and the Yvette silver-rich vein system.

Yvette

The new Yvette prospect represents the discovery of a previously unrecognized, high-grade, silver-polymetallic vein zone at the Santo Domingo project.

The Yvette vein system was discovered during reconnaissance exploration east of the El Arriero porphyry prospect. Historic mine workings are scattered along the trends of three, previously unidentified veins with a total strike length 2.5 kilometres. Wide-spread sampling over the prospect area is underway and the first assay results from selective rock chips over old mine dumps included:

• 3,552 g/t silver, 2.2 % lead, and 16.4 % zinc; and

• 1,543 g/t silver, 9.5 % lead, 13.6 % zinc and 7.3 g/t gold.

Representative (fixed length continuous samples) rock chip samples from vein material included:

• 0.3 metres at 1,089 g/t silver, 24.2 % lead, 13.4 % zinc, and 1.1 g/t gold;

• 0.8 metres at 606 g/t silver, 0.3 % lead, 3.1 % zinc, and 0.5 g/t gold; and

• 0.4 metres at 556 g/t silver, 22.7 % lead, 1.2 % zinc, and 1.5 g/t gold.

The focus of on-going exploration is to expand the size of the known mineralised area, which is open in all directions, and delineating targets ready for drilling in 2011.

The Company believes the area has potential for a low tonnage, high-grade deposit amendable to underground mining. This could be independent from any future development of the porphyry systems at Santo Domingo.

The short term focus of on-going exploration at Yvette is to expand the size of the known mineralised area through further sampling and geological mapping. This will include delineating new vein segments and exploring for potential strike extensions to the north and south. Subject to the success of the on-going field program, geophysics and a drilling program will be planned in 2011.

Divisoria

During the quarter, Elementos discovered a new porphyry system at the Divisoria, Santo Domingo. The porphyry system has a footprint of 300 x 200 metres, open in all directions. Key characteristics of the system include:

• Widespread disseminated porphyry gold-copper mineralisation;

• Small, high-grade gold, copper and polymetallic veins and breccias;

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• A strong, porphyry related, zoned alteration system, including potassic alteration) a strong indicator of close proximity to the core of a porphyry system); and,

• Location on a structural intersection, inside a large circular feature, which also encompasses the El Arriero and El Arriero Extension prospects.

The Company believes that Divisoria may represent the margin of a larger, highergrade system at a shallow depth. This program is currently suspended over the summer and will resume during the second quarter of 2011.

Santo Domingo Mineralised Environment

The Santo Domingo mineralised environment is proving to be large with a number of different mineralised styles and structures, all corresponding to different levels within a porphyry environment. These are hosted within a circular feature approximately four kilometres across which is still only partially explored. A preliminary conceptual geological model of the Santo Domingo project incorporates:

• Divisoria – gold-copper porphyry with cross cutting high-grade gold-copperbase metal veins and breccias;

• El Arriero and El Arriero Extension – low grade porphyry environment representing the periphery of a porphyry system;

• Alunita – transitional porphyry – epithermal target (currently being explored by the Company); and,

• Yvette – distal veins of high-grade silver-polymetallic vein mineralisation.

The Company believes that the Santo Domingo district has potential to be a significant centre of mineralisation. The focus of on-going exploration at each prospect includes:

• Yvette - expanding the size of the known mineralised area through further sampling and geological mapping. This will include delineating new vein segments and exploring for potential strike extensions to the north and south. Subject to the success of the on-going field program, geophysics and a drilling program will be planned for the second half of calendar 2011;

• Divisoria - expanding the Au-Cu disseminated mineralisation zone which is open in all directions, through further sampling in untested areas. The aim is to prepare drill targets within the disseminated mineralisation as well as the vein and breccia targets, which offer the potential for near surface, high-grade mineralisation at Divisoria;

• Alunita, El Arriero and the El Arriero Extension – follow-up fieldwork and drill target generation, although these are potentially slightly deeper targets than in Divisoria and are subsequently of lower priority; and

• District-scale exploration across the 250 square kilometre tenement package, which remains largely unexplored.

Santo Domingo Option-to-Purchase Contract Extension

The new contract terms provide for bi-annual option payments of US$35,000 commencing in October 2011, and an exercise price of US$530,000 on or before October 2015.

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CATHEDRAL ROCKS

During the quarter there were no exploration activities at Cathedral Rocks. On-going exploration activities will include mapping and rock-chip sampling to determine the zones of prospective mineralization at School Gully and Yaroonah. The Company also proposes to sample around numerous historic workings in the Yaroonah area, including the known base metal and molybdenum mineralisation and smaller historic tin mines scattered throughout the area;

The focus will be on the cupola of the Round Mountain monzo-granite and into the surrounding meta-sediments, as this zone plays host to all known mineralisation in the area; and follow-up on gold and silver anomalies identified in an approximately 2.5km wide by 17km long trend through the property.

MILLENIUM

During the quarter there were no exploration activities at Millenium. However, the Company is building its tenement position in the Cloncurry area and lodged applications for new tenements north and north-east of the Millenium Mining Licences (“ML’s”). Tenement applications along the Corella structural corridor total 254 square kilometres.

Weather permitting, exploration will commence in February/March

CORPORATE ACTIVITIES

Mark McCauley Appointed Director

The Company announced the appointment of Mark McCauley as a non-executive director.

Mr McCauley is currently Managing Director of RMM Capital, a Queensland based private equity firm specialising in resource investments. Prior to that, Mr McCauley was the chief financial officer and company secretary of Felix Resources Limited, a highly-successful coal company which, during Mr. McCauley’s tenure grew in market capitalisation from approximately $30 million to over $1 billion through a number of successful mergers, acquisitions and green field project developments.

Mr McCauley is also a director of Norton Goldfields Limited, and recently acted as Chief Executive Officer of the Company, working through a successful management restructure and repositioning of Norton.

Mr McCauley holds an Honours Degree in Engineering (majoring in Mining) from the University of Queensland, and a Masters in Business Administration from Bond University. Mr McCauley is also a graduate of the Advanced Management Programme at Harvard Business School, and a member of the Australian Institute of Company Directors.

In addition, Mr McCauley holds a First Class Underground Mine Manager’s Certificate.

Capital Raising Initiative

During the quarter, the company announced a capital raising and proposed rights issue to fast-track an aggressive exploration and acquisition program in 2011. The capital raising initiative incorporates:

• A 15% private placement of 8.1 million shares in the Company to Andes Investors LLC;

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• An additional private placement of 5.8 million shares to sophisticated investors Belmont Park Investments Pty Ltd and Panorama Ridge Pty Ltd, subject to approval by shareholders at a meeting to be called early in the new year; and

• A proposed pro-rata rights issue to shareholders on the register as at 31 January 2011 on a 1:4.48 basis.

The placement and rights issue will be priced at $0.26 per share, equal to the 14-day volume weighted average price (“VWAP”) when the transaction was negotiated and approved by the board. No brokerage or investment advisor fees are payable in connection with the transactions.

For more information, please contact:

Corey Nolan

Managing Director Phone: +61 (7) 3871 3985 Email: admin@elementos.com.au

Elementos is an Australian, ASX-listed, exploration company, with a number of projects in Argentina and Australia, which offer an attractive investment environment. The properties are all in mineral rich, highly prospective provinces, with developed infrastructure nearby.

Please visit us at www.elementos.com.au

COMPETENT PERSON STATEMENT

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Alistair Grahame, a member of the Australian Institute of Geoscientists. Mr Grahame is a full-time employee of Elementos Ltd and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which it 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.’ Mr Grahame consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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