ELEMENTOS LIMITED — Interim / Quarterly Report 2012

Jul 26, 2012

==> picture [591 x 118] intentionally omitted <==

27 July 2012

QUARTERLY REPORT JUNE 2012

Highlights

• Multiple mineralised structures identified across Tamaya for drilling during late 2012

• Numerous high-grade copper oxide targets recognised across Mercedes

• A cluster of prospective new vein targets, with gold up to 17.9 g/t, identified in close proximity to the Manantial Este and La Puerta veins

• Discussions are continuing with potential partners for the Santo Domingo project

• 254 square kilometres of Exploration Permits granted at Millenium

Elementos Limited (ASX: ELT) (“Elementos” or the “Company”) activities this quarter have concentrated on exploration activities at the two new Chilean projects, Mercedes and Tamaya, and on-going partnering discussions at the Santo Domingo project, Argentina.

MERCEDES, CHILE

The Company has recently completed mapping and sampling, airborne magnetometry, and Induced Polarisation (“IP”) surveys. The IP geophysical survey results highlighted a low-level chargeability anomaly (potential presence of sulphide mineralisation), but at depths likely to be uneconomic.

When exploring the Elvira porphyry system, Elementos has identified a number of near surface high-grade copper oxide targets including Mecha I, II, and III; and Pamela. The biggest structure is at Elvira. The oxide potential remains highly prospective, although further exploration is required prior to committing to drilling.

Sampling and mapping programs of exposed mineralisation and artisanal mines demonstrate the wide-spread distribution of high-grade copper oxides throughout the project area. There is also potential for deeper sulphide mineralisation within the structures. This hypothesis is also supported by the airborne magnetometry, which reveals a strong correlation between extensive geophysical lineaments and highgrade copper oxide mineralisation on surface.

Further geological mapping and sampling will be required, prior to drilling, to demonstrate that there are sufficient structures to achieve the volume required to create an economic copper oxide resource, capable of development into a solvent extraction and electro-winning operation.

During the September quarter, mapping and sampling programs will be completed at Marcelita.

==> picture [589 x 32] intentionally omitted <==

==> picture [120 x 44] intentionally omitted <==

TAMAYA, CHILE

The first phase exploration activities commenced in April and have included:

• Reconnaissance mapping – locating and assessing the extents and potential of the known structures, as well as identifying new structures across the property. Three major north-south trends have been identified and correlate strongly with copper and gold from the sampling programs. Approximately 70% of the property has now been covered by reconnaissance exploration;

==> picture [454 x 433] intentionally omitted <==

Figure 1: Map showing the extent of mineralised structures identified to date across Tamaya as interpreted from outcrops, old workings and historic mining activities. The three main trends are inferred from both field observations and interpretation of the ground-magnetometry results.

• Sampling – during the initial reconnaissance phase, more than 300 samples were collected from outcrops, historic workings or from waste piles proximal to mines. Wide-spread copper mineralisation with copper up to 7.91% and gold up to 9.51g/t have been identified.

Page 2 of 6

==> picture [120 x 44] intentionally omitted <==

The reconnaissance sampling is currently being followed-up with detailed, representative channel sampling based on the priorities defined to date.

It will not be possible to assess accurately the mineralisation from surface results, since most of the high-grade mineralisation at surface has been extracted, leaving no outcrop and unsafe workings where sampling is not possible;

==> picture [454 x 444] intentionally omitted <==

Figure 2: Map of copper values in outcrop (circles) and mine-proximal waste (triangles) at Tamaya. The strong linear trends correlate closely with the strong linear anomalies in the ground-magnetometry results.

• Geophysics - 690 kilometres of ground-magnetometry has been completed across the property. This identified both the principle mineralised structures and a number of major and lesser cross-cutting lineaments that help explain and predict the distribution of mineralisation across the property.

Page 3 of 6

==> picture [120 x 44] intentionally omitted <==

The results also support the potential for a deeper porphyry-style intrusion in the east of the property, analogous to that at Andacollo Mine 40 kilometres to the northeast; and

• Drill target identification - five core target areas have been identified: Central, Lecaros, Tortolas, Norte and Este.

==> picture [454 x 279] intentionally omitted <==

Figure 3: Reduced to Pole Ground-magnetometry at Tamaya draped over topography with the primary and secondary structures highlighted.

The on-going exploration activities at Tamaya will test a variety of oxide and sulphide targets, including:

• Lower grade bulk-tonnage mineralisation in the broad shear and breccia structures that host the main veins, material that was not worked historically because of the lower grades, and in recently identified structures including Tortolas and Lecaros;

• Remnants of the high-grade sulphide vein down to the historical mining levels, up to 700 metres below the Tamaya ridge;

• High-grade sulphides below the old mine workings beneath the historical mining levels; and

• A potential porphyry target indicated by the alteration and mineralisation styles, and the ground-magnetometry survey.

Additionally, exploration is now revealing gold and silver precious metal values in the mineralised structures that were not previously recognised. This will be tested as part of the on-going exploration activities.

A diamond drilling program, planned to start during the third quarter 2012, will be supported by the on-going detailed mapping and sampling programs, together with

Page 4 of 6

==> picture [120 x 44] intentionally omitted <==

an induced polarisation geophysical survey to test for the potential intrusive mineralisation in the east of the property.

Elementos has a joint venture with HMC Gold SCM on the Tamaya copper project in Chile, comprising 5,690 ha and 1,200 ha of mining concessions and exploration applications respectively. The Company has made subsequent applications over ground hosting extensions of known mineralisation totalling 2,700 hectares.

MANANTIALES, ARGENTINA

Following the completion of the Phase II Extended drilling program and the start of winter, the exploration focus has turned to new prospect identification and the compilation and interpretation of all historical results, for future drill planning purposes.

A cluster of new veins have been identified in the south-western corner of the Manantiales tenement, in close proximity to the Manantial, Manantial Este and La Puerta vein systems.

The majority of the new veins are topographically lower than the Manantial vein, and are also believed to be at a higher level within the epithermal environment. This is based on the high ratio of calcite to quartz, low silver content, and indications that the host rock is similar to that at Manantial vein where the company has drilled the upper levels of a mineralised epithermal system.

The most significant of these, based on the initial results, is the Valentina vein, situated 2.5 kilometres east of Manantial vein and 2.5 kilometres west of the La Puerta prospect. Initial representative rock chip samples have returned high-grade gold values with anomalous silver.

Highlights include:

• Three high-grade rock chip samples returning 17.9 g/t gold and 36 g/t silver, 12.7 g/t gold and 26 g/t silver, and 10.1 g/t gold and 27 g/t silver;

• An additional five rock chip samples above 4 g/t gold including peaks of 8.59 g/t gold and 29 g/t silver; and

• The structure remains open along strike with samples in the northern and southern ends returning 6.91 g/t gold and 12.7 g/t gold respectively.

Additionally, three more new vein prospects have been identified: Gabo, Colorado and Colorado Sur.

SANTO DOMINGO, ARGENTINA

There were no exploration activities at Santo Domingo during the quarter.

The Company had begun discussions with a number of potential joint venture partners with the financial capacity to explore and develop a large porphyry target. The partnering process is anticipated to take several months.

The Company believes that Santo Domingo could host a world-class deposit, which will require significant investment in exploration and infrastructure, including additional geophysics and deep drilling.

MILLENIUM, AUSTRALIA

There were no exploration activities at Millenium during the quarter.

Page 5 of 6

==> picture [120 x 44] intentionally omitted <==

During the quarter, Exploration Permits (“EPMs”) totalling 254 square kilometres were granted (an additional 77 square kilometres of EPMs remain subject to granting). An exploration program is being planned to test for the copper, gold and rare-earth potential in the areas within the newly granted permits.

Forte Energy NL is currently renewing the Mining Licences subject to an Option-toPurchase contract with the Company.

CATHEDRAL ROCKS, AUSTRALIA

There were no exploration activities at Cathedral Rocks during the quarter. The EPMs are currently subject to renewal process.

CASH RESOURCES

At the end of the period, the Company had cash resources of $2 million. In addition, the Company has a $0.5 million bank guarantee on deposit that will be released on completion of the first 5,000 metres of drilling at Tamaya.

For more information, please contact:

Corey Nolan

Managing Director Phone: +61 (7) 3221 7770 Email: admin@elementos.com.au

Elementos is an Australian, ASX-listed, copper and gold exploration company, with projects in Chile, Argentina and Australia. 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.

Page 6 of 6

Appendix 5B Mining exploration entity quarterly report

4Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001, 01/06/2010.

Name of entity

ELEMENTOS LIMITED

	ABN 49 138 468 756 Consolidated statement of cash flows		Quarter ended (“current quarter”) 30 JUNE 2012	Quarter ended (“current quarter”) 30 JUNE 2012
			30 JUNE 2012
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration and evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other – Bank Guarantee Net Operating Cash Flows		Current quarter $A’000		Year to date $A’000
		- (1178) (262) 26 (495)		10 (5047) (1939) 275 (495)
		(1909)		(7196)
Cash flows related to investing activities 1.8 Payment for purchases of: (a)prospects (b)equity investments (c) other fixed assets 1.9 Proceeds from sale of: (a)prospects (b)equity investments (c)other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)		(7)		(94)
		(7)		(94)
		(1916)		(7290)

• See chapter 19 for defined terms.

Appendix 5B Page 1

30/9/2001

Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(1916)	(7290)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other: Cost of share issue (adjust for IPO) Net financing cash flows	Nil Nil	Nil Nil
	Nil	Nil
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end ofquarter	(1916) 3957 (28)	(7290) 9317 (14)
	2013	2013

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

1.23 1.24	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
		113
		Nil
1.25	Explanation necessaryfor an understandingof the transactions

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

Nil

• 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

Nil

• See chapter 19 for defined terms.

Appendix 5B Page 2

30/9/2001

Appendix 5B Mining exploration entity quarterly report

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	Nil	Nil
	Nil	Nil

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	450
	Nil
	Nil
	350
Total	800

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
5.1 Cash on hand and at bank 5.2 Deposits at call 5.3 Bank overdraft 5.4 Other (provide details)	951	1395
	1062	2562
Total: cash at end of quarter(item 1.22)	2013	3957

Changes in interests in mining tenements

Tenement reference	Nature of interest (note (2))	Interest at beginning ofquarter	Interest at end of quarter
EPM19014 EPM19036 EPM18982 EPM18402 EPM18773 EPM18793	Exploration Permit Exploration Permit Exploration Permit Exploration Permit Exploration Permit Exploration Permit	- - - - - -	100% 100% 100% 100% 100% 100%

• See chapter 19 for defined terms.

Appendix 5B Page 3

30/9/2001

Appendix 5B Mining exploration entity quarterly report

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

	Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note 3) (cents)
7.1 Preference+securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital,buy-backs,redemptions
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital,buy-backs	82,383,526	82,383,526
7.5 +Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured,converted
7.7 Options (description and conversion factor) Unlisted Options 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter	4,500,000 1,500,000 1,200,000 500,000 1,000,000	Nil Nil Nil Nil Nil	Exercise price 23.3 cents 30.0 cents 25.0 cents 23.3 cents 33.3 cents	Expiry date 23 October 2015 23 December 2013 7 September 2015 30 November 2015 18 January 2017
	1,000,000	Nil	23.3 cents	23 October 2015
7.11 Debentures (totals only)
7.12 Unsecured notes(totals only)

• See chapter 19 for defined terms.

Appendix 5B Page 4

30/9/2001

Appendix 5B Mining exploration entity quarterly report

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).

• 2 This statement gives a true and fair view of the matters disclosed.

==> picture [116 x 38] intentionally omitted <==

Sign here: ............................................................ Date: 27 July 2012 (Director/Company secretary)

Print name:

Paul Crawford

Notes

• 1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

• 2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

• 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities .

• 4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.

• 5 Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

== == == == ==

• See chapter 19 for defined terms.

Appendix 5B Page 5

30/9/2001