EMU NL — Interim / Quarterly Report 2013

Apr 29, 2013

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EMU NL ABN 50 127 291 927

QUATERLEY REPORT FOR THE PERIOD ENDING 31 MARCH 2013

HIGHLIGHTS

TONNES PROCESSED(MARCH)		118,868
OPERATING COSTS MARCH(PER TONNE)		US$5.77
DIAMONDS RECOVERED (MARCH) (CARATS)		7,113
DIAMONDS SOLD MARCH & APRIL (CARATS)		10,345
FUNDS RECEIVED MARCH & APRIL SALES
		US$1.44M
AVERAGE PRICE PER CARAT		US$139

SOUTH AFRICA DIAMOND OPERATIONS

As announced on 20[th] February 2013, Emu NL and El Nino Mining Proprietary Limited (a South African registered company) had entered into an agreement to jointly acquire ownership of Superkolong Proprietary Limited, a South Africa registered company whose business is the recovery of diamonds from coarse tailings at Kimberley, South Africa.

The change of ownership of Superkolong was completed on 28 February and the transition to new owners occurred seamlessly on 1 March 2013. Since assuming control of the operation, areas of historically high break down frequency, high maintenance costs and operational inefficiency have been targeted and this work is ongoing. As these parts of the operation are up ~~graded there will be a gradua~~ l improvement in tonnes processed and stabilisation of costs.

The tender results have been favourable due to t ~~he quality of the diamonds recover~~ ed. The tender result for April included diamonds recovered up until 20[th] April. Diamonds recovered from then to month end will be held over to the May sales which will be held during the week beginning 20[th] May.

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WESTERN AUSTRALIAN PROJECTS

Emu Lake Joint Venture (Emu 30.3%)

The joint venture partners have initiated the process of divesting this project and are in discussions with several parties.

Lake Pyramid

No work undertaken. The Company is seeking expressions of interest for this project.

Ward Springs

The drilling program proposed to test the EM targets was approved by the DMR. The Company is seeking expressions of interest for this project also.

PLACEMENT

On 11[th] April 2013 shareholders approved a placement of 14,747,964 contributing shares to Bullantco Pty Ltd, a company associated with Messrs Steemson and Thomas. Upon receipt of funds from this placement, the Company’s funds will increase by approximately $442,438.

CHANGE OF NAME

At the same meeting to approve the Placement, shareholders also approved the change of name for the Company.

30 APRIL 2013

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About Superkolong Proprietary Limited

Superkolong ( SK ) is a 30.4% shareholder of Kimberley Miners Forum Proprietary Limited ( KMF ) which has purchased various Tailings Mineral Resources around Kimberley, South Africa, from De Beers Consolidated Mining ( DBCM ). SK and the other two shareholders recover diamonds using their own processing plants. The material processed is drawn from several small outer dumps, the “Outer Dumps”, and the largest TMR, Chrono 1.

Cautionary Statement

The Chrono 1 mineral resource was estimated by DBCM in 2007. It was done in accordance with SAMREC and is a qualifying foreign resource estimate . The DBCM work has been reviewed by Greg Steemson FAusIMM who has concluded that the work complies with SAMREC/JORC and is reliable. In Mr Steemson’s view, no further work is justified.

The resources for the Outer Dumps were also estimated by DBCM but apart from summary sheets prepared by DBCM and KMF production data, no other information is available.

The Chrono data was collected by DBCM between August 2003 and August 2007.

TABLE 1

Sampling techniques	Between 7 August 2003 and 10 August 2005, 154 large diameter auger (LDA) holes were drilled into the Chrono 1, 2, 3 and 4 dumps. 997 samples were collected. 760 samples were processed between March 2004 and October 2006. The remaining samples were not processed as the results would have only been available after the time scheduled for completion of the project and, in the view of DBCM, there was sufficient information to classify Chrono 1 as an Indicated Resource. In 2012, 206,000 t of material from Chrono 1 was processed by SK plant. The smaller Outer Dumps have been processed since 2007 by Kimberley Miners Forum Proprietary Limited and consistently return recovered grades between 6 and 9 cpht. These resources are classified as Inferred notwithstanding they are being processed as if they were reserves.
Drilling techniques.	A Bauer BG36C auger rig was used for the drilling program on the Chrono dumps. The rig drills a hole of diameter approximately 1m. This drilling technique is generally regarded as the best sampling method for diamonds. No drilling results are available for the outer dumps.
Drill sample recovery.	Samples generally weighed around 30t (arithmetic average 34t) but some were < 20t and some > 40t.
Logging.	The material recovered was coarse kimberlite tailings and rock and apart from that observation, there are no records of the material being described.
Sub-sampling techniques and sample	The samples were trucked to the DBCM Kimberley Mines SamplingPlant andprocessed between March 2004 and

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preparation.	October 2006. Samples were tipped into the feed bin then processed as follows: weightometer > scrubbing > aquamator > DMS > recovery > drier > sizing > x-ray sort > hand sorting > grease belt on x-ray tailings > weighing diamonds.
Quality of assay data and laboratory tests.	25,079t processed recovering 18,828 stones for 1,273.12 carats.
Verification of sampling and assaying.	No duplicate samples were taken.
Location of data points.	LDA holes were surveyed by the DBCM mine surveyor once drilling was completed.
Data spacing and distribution.	LDA holes were spaced approximately 60m apart.
Orientation of data in relation to geological structure.	The LDA holes were vertical which is the best drill hole orientation as the stratification is sub-horizontal.
Audits or reviews.	None documented by DBCM. Emu and El Nino have conducted their own reviews of the drilling and the processing during 2012. The material processed in 2012 did not reduce or increase the grade off the Outer Dump material.

Estimation and reporting of Mineral Resources

Database integrity	The Chrono 1 DBCM drilling data has been entered into Xcel spread sheets for plotting and computation purposes. It has been checked against the original hard copy reports.
Geological interpretation	The dumps are generally sub-horizontally stratified.
Dimensions	The Chrono dumps are approximately 60m high and measure approximately 600m wide and 2,000m long in an arcuate shape. The Outer Dumps are of variable sizes. In general, the previous estimates have been found to be conservative in that the tonnages reclaimed are > resource estimates.
Estimation and modeling techniques	Chrono 1 was block modeled using blocks of dimension 120 x 120 x 10m. A copy of the report is not held by the Company.
Moisture	The tonnage factor was estimated by DBCM using the mass and estimated volume of each bulk sample and usingthe

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	Troxler density gauge. Dry density 1.61 t/cu.m and insitu density 1.79 t/cu.m.
Cutoff parameters	Samples were screened at 1mm.
Mining factors	The dump material is generally pushed by bulldozer and loaded with an excavator for transport to the plant sites.
Metallurgical factors	The dump material is amenable to conventional processing by pan and DMS.
Bulk density	See above
Chrono 1	42.7 million tonnes @ 6.15 cpht (weighted average grade of the bulk samples)
Outer Dumps	8.0 million tonnes @ 8 cpht (average recovered grade)
Classification	Chrono 1 is classified as Indicated. The Outer Dumps are classified as Inferred.
Audit	Apart from the review undertaken by Emu & El Nino, none known.

Estimation and reporting of diamonds and other gemstones

Source of Diamonds	The diamonds are contained in coarse tailings and kimberlite derived from various kimberlite mining operations around Kimberley. The grade of the Outside Dumps is known from plant recoveries. The recovered grade of these dumps is between 6 and 9cpht. The Chrono TMRs came from various sources including Bultfontein, Wesselton, Du Toitspan. The diamonds range from low value industrial type goods to large gem quality diamonds.
Sample collection	DBCM drilled 154 Large Diameter (1m) Auger holes through the Chrono dumps, collected 997 bulk samples (nominally 30t each), processed 760 bulk samples (25,079 tons) and recovered 1,273.13 carats. A Bauer BG36C rig was used for the work. The LDA were drilled on a nominal 60m grid. Holes were drilled to the base of the dump, between 50 and 60m. Sample interval was nominally 5m.
Sample treatment	The samples from the Chrono dumps were screened and concentrated at the Kimberley Mines Sampling Plant which emulated DBCM full scale plants. Oversize was screened at 25mm. The bottom size was 1mm. The diamonds were recovered using a DMS followed by flow sort machines and grease tables.

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					The oversize consists of primary kimberlite and was crushed before processing.	The oversize consists of primary kimberlite and was crushed before processing.	The oversize consists of primary kimberlite and was crushed before processing.	The oversize consists of primary kimberlite and was crushed before processing.	The oversize consists of primary kimberlite and was crushed before processing.
Sample grade					Grades recovered per bulk sample ranged from nil to 47.2 carats (1 carat = 0.2g). Eighteen thousand eight hundred and twenty eight (18,828) stones were recovered amounting to 1,273.13 carats. The grade of the Outside Dumps is averaging between 6 and 9cpht based on actual plant recoveries. The average grade (estimated by DBCM) of the 760 samples processed by DBCM was 5.11cpht for the whole Chrono Dump. The weighted average grade (estimated by Emu/El Nino) of Chrono 1 samples was 6.15cpht with the grade slowly decreasing towards Chrono 2. The dry density was estimated (by DBCM) at 1.61t/m3 and wet density at 1.79t/m3.
Value estimation					The average price per carat received by SK at tender for 2012 was US$102/ct. Values for individual parcels range from < US$30/ct for industrial goods to > US$2,000/ct for gem.
Security & integrity					The bulk samples processed by DBCM followed their standard operating procedures.
Classification					Chrono 1–Indicated ~~Outer Dumps- Inferr~~ed
					~~Ou~~	~~ter Du~~	~~ps- I~~	~~nfer~~
									~~m~~ation is available.
	~~A/QC~~				~~No~~	~~quanti~~	~~ative~~	~~nfor~~

DUMP+%+BLEND+vs+GRADE+>+2012+

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50$
45$
40$
35$ BOSHOF$C$
BOSHOF$N$
30$
AREA$8/8$
25$ GEMDENE$12$
CHRONO$1$
20$
GRADE$
15$
10$
5$
0$
APR$12$ MAY$12$ JUN$12$ JUL$12$ AUG$12$ SEP$12$ OCT$12$ NOV$12$ DEC$12$
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DUMP+%+BLEND+vs+GRADE+A+2013+
$40$$
$35$$
$30$$
BOSHOF$C$
$25$$ BOSHOF$N$
AREA$1/19$
$20$$ AREA$5/6$
AREA$8/8$
$15$$ GEMDENE$12$
CHRONO$1$
$10$$ GRADE$
$5$$
$3$$
JAN$13$ FEB$13$ MAR$13$ APR$13$ MAY$13$ JUN$13$ JUL$13$ AUG$13$ SEP$13$ OCT$13$ NOV$13$ DEC$13$
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For more information on the company visit www.emunl.com.au Please direct enquiries to:

Greg Steemson Managing Director Phone: (08) 9226 4266 Mobile: 0417 981 814 Email: gsteemson@bigpond.com

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Emu NL ABN 50 127 291 927

ASX Code: EMU

10 Walker Ave West Perth, WA 6005

T +61 8 9226 4266 E info@emunl.com.au

PO Box 1112 West Perth, WA 6872

Issued Capital :

Shares - Quoted: 34,643,856 fully paid shares 19,894,892 contributing shares

COMPETENT PERSON’S STATEMENT

The details contained in this report that pertain to exploration results, mineral resources and mineral reserves are based upon information compiled by Mr. Greg Steemson, Managing Director of Emu NL. Mr. Steemson is a Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM) and has sufficient experience in 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 Exploration Results, Mineral Resources and Ore Reserves” (JORC Code). Mr. Steemson consents to the inclusion in the report of the matters based upon his information in the form and context in which it appears.

Options – Unquoted:

~~841,148 exercisable at $0.5874~~ by 22.12.2014 82,736 exercisable at $0.4266 by 21.12.2015

Directors:

Peter Thomas Chairman

Greg Steemson Managing Director

George Sakalidis & Gavin Rutherford Non-Executive Directors

FORWARD LOOKING STATEMENT

This report contains forward looking statements concerning the projects owned by Emu NL. Statements concerning mining reserves and resources may also be deemed to be forward looking statements in that they involve estimates based on specific assumptions. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward looking statements as a result of a variety of risks, uncertainties and other factors. Forward looking statements are based on management’s beliefs, opinions and estimates as of the dates the forward looking statements are made and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments.

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Appendix 5B Mining exploration entity quarterly report

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10

Name of entity

	Emu NL
	ABN 50 127 291 927 Consolidated statement of cash flows
			31 March 2013
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & 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 (provide details if material) NetOperating Cash Flows		Current quarter $A’000		Year to date (9 months) $A’000
		8 (233) - - (330) - 20 - - 39		24 (334) - - (553) - 89 - - 39
		(496)		(735)
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)		- - (8) - - 10 (2,279) - -		- - (8) - 30 10 (2,279) - -
		(2,277)		(2,247)
		(2,773)		(2,982)

• See chapter 19 for defined terms.

17/12/2010 Appendix 5B Page 1

Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(2,773)	(2,982)
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 (provide details if material) Net financing cash flows	597 - - - - -	1,097 - - - - -
	597	1,097
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	(2,176) 3,093 -	(1,885) 2,802 -
	917	917

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	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
			209
			2,279
1.25 Explanation necessaryfor an understandingof the transactions Item 1.23 includes aggregate amounts paid to directors including salary, directors’ fees, consulting fees, superannuation and geological consulting services. Item 1.24 represents loan funds advanced to a companyclassified as an associate. 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 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest		Explanation necessaryfor an understandingof the transactions
		Item 1.23 includes aggregate amounts paid to directors including salary, directors’ fees, consulting fees, superannuation and geological consulting services. Item 1.24 represents loan funds advanced to a companyclassified as an associate.
	Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest

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

• See chapter 19 for defined terms.

Appendix 5B Page 2

17/12/2010

Appendix 5B Mining exploration entity quarterly report

Estimated cash outflows for next quarter

Estimated cash outflows for next quarter
4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	150
	-
	-
	200
Total	350

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)	917	779
	-	2,314
	-	-
	-	-
Total: cash at end of quarter(item 1.22)	917	3,093

Changes in interests in mining tenements

6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased	Tenement reference	Nature of interest (note (2))	Interest at beginning ofquarter	Interest at end of quarter
	E15/0883 E51/0900 E51/1300 E51/1472 E51/1473 P51/2596 P51/2616 P51/2645 P51/2648 E27/0434 M27/0457 M27/0460 P27/1750 P27/1751	JV	51% 51% 51% 51% 51% 51% 51% 51% 51% 30.3% 30.3% 30.3% 30.3% 30.3%	0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%

• See chapter 19 for defined terms.

17/12/2010 Appendix 5B Page 3

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	34,643,856 19,894,892	34,643,856 -	Fully paid 6 cents	Fully paid 3 cents
	1,000 19,894,892	1,000 -	Fully paid 6 cents	Fully paid 3 cents
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) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter	841,148 82,736	- -	Exercise price $0.5874 $0.4266	Expiry date 22 December 2014 21 December 2015
	4,596,435	-	$1.0878	27 February 2013
7.11 Debentures (totals only)
7.12 Unsecured notes (totals only)

• See chapter 19 for defined terms.

Appendix 5B Page 4

17/12/2010

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 5).

• 2 This statement does ~~/does not*~~ (delete one) give a true and fair view of the matters disclosed.

Sign here:

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Date: 30 April 2013

(Company secretary)

Print name: Dennis Wilkins

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 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

• 5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting 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.

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• See chapter 19 for defined terms.

17/12/2010 Appendix 5B Page 5