EQ RESOURCES LIMITED — Interim / Quarterly Report 2016

Apr 28, 2016

Appendix 5B Mining exploration entity quarterly report

Rule 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, 01/06/10.

Name of entity

	Carbine Tungsten Limited
	ABN 77 115 009 106 Consolidated statement of cash flows
			31 March 2016
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 – tenement security deposits – Research and Development Tax Offset – Miscellaneous rebates and refunds Net Operating Cash Flows			Current quarter 31 March 2016 $A’000	Year to date (9 months) 31 March 2016 $A’000
			- - (176) - (304) - 5 (11) - - - 2	- (7) (696) - (757) - 28 (31) - - - 3
			(484)	(1,460)
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 – Lanstead Sharing Agreement – net Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)			- - - - - - - - (17)	- - - - - - - - (17)
			(17)	(17)
			(501)	(1,477)

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(501)	(1,477)
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 – Share issue costs Net financing cash flows	306 - - (214) - (5)	860 - - (898) - (10)
	87	(48)
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	(414) 706	(1,525) 1,817
	292*	292
*The cash balance of $292,000 at quarter end does not include the R&D received from the Australian Taxation Office on 2 April 2016.		Tax Offset of $769,717

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 Aggregate amount of payments to the parties included in item 1.2 1.24 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
	89
	Nil

1.25 Explanation necessary for an understanding of the transactions

1.23 – Executive director salary, consulting fees and reimbursement of expenses paid to directors or entities associated with directors at normal commercial rates.

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

In March 2016, the Company signed amended Tranche A and Tranche B Subscription Agreements to raise, in aggregate, $1,875,000 before expenses from Lanstead Capital L.P. ("Lanstead") by way of a subscription for 75,000,000 ordinary shares at a price of $0.025 per share. The Company also entered into a Sharing Agreement with Lanstead such that the Company's economic interest will be determined and payable in 18 monthly settlement tranches as detailed in the placement announcement of 20 November 2015. As consideration for entering into the sharing agreements, the Company issued 3,000,000 shares on 20 November 2015 and a further 5,000,000 shares on 11 March 2016 such that 83,000,000 shares, in total, have been issued to Lanstead pursuant to the amended Tranche A and Tranche B Subscription Agreements at 31 March 2016. During the March 2016 quarter, the Company received $39,577 in credit support instalments, net of sharing agreement settlements pursuant to the Tranche A Subscription Agreement. $755,556 remains invested in the Tranche A Sharing Agreement. On 11 March 2016, the Company issued 35,000,000 ordinary shares to Lanstead pursuant to the Tranche B placement. $857,000 remains invested in the Tranche B Sharing Agreement at 31 March 2016.

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

• 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

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities - Mitsubishi Corporation RtM Japan Ltd 3.2 Credit standby arrangements - Lanstead sharingagreement	Amount available $A’000	Amount used $A’000
	457	457
	1,875	263

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration (including loan repayment and interest costs)	$A’000
	-
	180
	-
	350
Total	530

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 – Bank Bills and Term Deposits	190	605
	-	-
	-	-
	102	101
Total: cash at end of quarter(item 1.22)	292	706

Changes in interests in mining tenements

6.1 Interests in mining tenements relinquished, reduced or lapsed	Tenement reference	Nature of interest (note (2))	Interest at beginning ofquarter	Interest at end of quarter

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

6.2	Interests in mining
	tenements acquired or
	increased

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 7.2	Preference+securities (description) Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs,redemptions
7.3 7.4	+Ordinary securities Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs	418,415,995	418,415,995	Fully Paid	Fully Paid
		49,300,000	49,300,000	2.5 cents	2.5 cents
7.5 7.6	+Convertible debt securities (description) Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7 7.8 7.9 7.10	Options (description and conversion factor)	8,000,000	-	Exercise price (cents) 20 cents	Expiry date 12-Nov-17
	Options Issued during quarter Options Exercised during quarter Options Lapsed during quarter
7.11	Debentures (totals only)
7.12	Unsecured notes (totals only)

• See chapter 19 for defined terms.

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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 does give a true and fair view of the matters disclosed.

Sign here: ( ~~Director~~ /Company Secretary)

Date: 29 April 2016

Print name: David W. Clark

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.

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Appendix 5B Mining exploration entity quarterly report

Schedule of Tenements as at 31 March 2016

	Tenement Name		Number	Holder	Expiry	Comments
Queensland
Mt Carbine		ML 4867 ML 4919		Carbine Tungsten Limited – Mineral Rights	31 Jul 2022 31 Aug 2023	Sub-Lease
Mt Carbine Extended		EPM14871		Carbine Tungsten Limited	12 Dec 2020	5 Year Renewal Granted
Mt Holmes		EPM 14872		Carbine Tungsten Limited	11 Dec 2020	5 Year Renewal Granted

ML = mining licence EPM = exploration permit

• See chapter 19 for defined terms.

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