EQUATORIAL RESOURCES LIMITED — Capital/Financing Update 2012

Jun 27, 2012

==> picture [580 x 158] intentionally omitted <==

ASX: EQX | 28 June 2012 | ASX RELEASE

DRILLING COMMENCES AT BADONDO

HIGHLIGHTS

• Drilling has commenced at Equatorial’s 100% owned Badondo Iron Project in the North West of the Republic of Congo.

• Completition of pre-drilling field work has revealed the presence of a thick and extensive hematite cap. This hematite cap is at least 50m thick in visible cliff exposures and appears to extend over the entire 10km strike length of the main target prospect.

• Initial scout drilling program has been expanded following the identification of extensive zones of massive hematite and will consist of 20-30 holes for approximately 5,000m of drilling.

Equatorial Resources Limited (“Equatorial” or “the Company”) is pleased to announce that drilling has commenced at its 100% owned Badondo Iron Project (“Badondo” or “the Project”) in the Republic of Congo (“ROC”). The drilling program will consist of approximately 5,000m of diamond drilling aimed at defining the thickness, quality and extent of the identified high grade hematite cap.

Badondo is located in the North West of the ROC within a regional cluster of large-scale and high quality iron ore exploration projects (refer Figure 1 and 2). High value iron deposits within 100km of Badondo include the Mbalam Iron Project owned by Sundance Resources Limited (775.4Mt at 57.2% Fe), Avima owned by Core Mining Limited (580Mt at 60% Fe), and Belinga owned by China Machinery Engineering Company (566Mt at 62% Fe).

Equatorial Resources Limited’s Managing Director and CEO, Mr John Welborn, said: “We are delighted with our progress at Badondo. The commencement of drilling has followed a three phased pre-drilling exploration campaign that has confirmed the potential for Badondo to host an extensive hematite cap. The drilling program will provide a clear indication of the geological quality, scale and value of Badondo. The initial program will provide a strong platform for further work and ongoing regional cooperation over the development of transport infrastructure required to unlock the value of this emerging iron region. The scale and quality of the world class iron projects being developed by Sundance, Core Mining, and CMEC have the potential to create a new Pilbara in Central West Africa. Drilling results from Badondo will be released to the market when received”.

EQUATORIAL RESOURCES LIMITED | ABN 50 009 188 694 Level 2, BGC Centre, 28 The Esplanade, Perth, WA, Australia 6000 | Phone: +61 8 9466 5030 | Fax: +61 8 9466 5029

www.equatorialresources.com.au

ASX: EQX | 28 June 2012 | ASX RELEASE

==> picture [378 x 378] intentionally omitted <==

Figure 1: Badondo Project Location Plan

==> picture [415 x 295] intentionally omitted <==

Figure 2: The Iron Mountains of the Congo Craton

2

ASX: EQX | 28 June 2012 | ASX RELEASE

Drilling Program

The initial drilling program will involve the completion of approximately 20-30 holes for approximately 5,000m of diamond drilling at the Badondo Prospect (refer Figure 3). Recent mapping has confirmed a 10km strike length of the Badondo Prospect. The drilling campaign has been designed to test the thickness, quality and extent of the high grade hematite mineralisation along the entire strike at the Badondo Prospect. The results are intended to provide an early indication of the geological potential of the Project. The goal is to demonstrate the potential for the project area to host significant quantities of high grade DSO iron mineralisation similar to other world class iron projects in the region.

The drilling program was designed by Equatorial’s in-house geological team working in close collaboration with SRK Consulting (“SRK”). Geologists from Sundance Resources Limited also provided advice on the program, drawing on their experience in the region.

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 59] intentionally omitted <==

==> picture [368 x 53] intentionally omitted <==

Figure 3: Drill Program at the Badondo Prospect

3

ASX: EQX | 28 June 2012 | ASX RELEASE

==> picture [253 x 340] intentionally omitted <==

Figure 4: Testing of the purpose-built helicopter-transportable diamond drill rig prior to shipment to the ROC

==> picture [318 x 211] intentionally omitted <==

Figure 5: Equatorial drill rig and exploration team on site during first day of drilling at Badondo

For further information contact:

John Welborn Managing Director & CEO Telephone : +61 8 9466 5030

Email : info@equatorialresources.com.au Web : www.equatorialresources.com.au

4

ASX: EQX | 28 June 2012 | ASX RELEASE

ABOUT EQUATORIAL RESOURCES

Equatorial Resources Limited (ASX: EQX ), is focused on the exploration and development of two 100% owned potentially large-scale iron ore projects located in the politically stable and investment friendly Republic of Congo (“ ROC ”) in the emerging global iron ore province of Central West Africa.

The Mayoko-Moussondji Iron Project , located in the southwest region of the ROC, has an estimated global exploration target of between 2.3 and 3.9 billion tonnes[1] of iron mineralisation at a grade of 30% to 65% Fe. The project has access to a rail line running directly to the deep-water port of Pointe-Noire, where the Company’s administrative office is located.

The Badondo Iron Project , in the northwest region of ROC, has an estimated global exploration target of between 1.3 and 2.2 billion tonnes[1] of iron mineralisation at a grade of 30% to 65% Fe. The project is located within a regional cluster of world-class iron ore exploration projects including Sundance Resources’ Mbalam and Nabeba projects.

==> picture [251 x 232] intentionally omitted <==

==> picture [251 x 231] intentionally omitted <==

For further information contact:

John Welborn Managing Director & CEO Telephone : +61 8 9466 5030 Email : info@equatorialresources.com.au Web : www.equatorialresources.com.au

1 Exploration Target: The estimates of exploration target sizes mentioned in this announcement should not be misunderstood or misconstrued as estimates of Mineral Resources. The potential quantity and grade of the exploration targets are conceptual in nature and there has been insufficient exploration to define a Mineral Resource in accordance with the JORC Code (2004) guidelines. Furthermore, it is uncertain if further exploration will result in the determination of a Mineral Resource.

The information in this report that relates to Exploration Results, other than Metallurgical Test Results and Geophysical Exploration Results, is based on information compiled by Mr Sean Halpin, who is a member of the Australian Institute of Geoscientists. Mr Halpin is a full time employee of Equatorial Resources Limited. Mr Halpin has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to 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’. Mr Halpin consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this report that relates to Metallurgical Test Results is based on information compiled by Dr John Clout who is a Fellow of the Australasian Institute of Mining and Metallurgy. Dr Clout is a consultant to Equatorial Resources Limited. Dr Clout has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to 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’. Dr Clout consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this announcement that relates to Geophysical Exploration Results is based on information compiled by Mr Mathew Cooper (B.App.Sc (Geophysics) Hons.) of Resource Potentials Pty Ltd, who was engaged by Equatorial Resources Limited to provide geophysical consulting services. Mr Cooper is a member of The Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to 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. Mr Cooper consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

5