EQUATORIAL RESOURCES LIMITED - Interim / Quarterly Report 2011

ASX: EQX | 29 July 2011 | ASX RELEASE

JUNE 2011 QUARTERLY REPORT

Equatorial Resources Limited (“Equatorial” or the “Company”) is pleased to present its quarterly report for the period ended 30 June 2011.

HIGHLIGHTS

Drilling has continued at the Company’s 100% owned Mayoko-Moussondji Iron Project (“MayokoMoussondji”) in the Republic of Congo (“ROC”). Initial observations of the drill core have confirmed the Company’s geological model and supported the potential for shallow hematite iron mineralisation and direct shipping ore (“DSO”). Preliminary assay results are expected to be released in late September 2011.
Wallis Drilling (“Wallis”) have been contracted to supply additional drill rigs for a further 28,000m drilling program. Wallis will operate in parallel with the existing program already underway with Partners Drilling International (“Partners”) and are expected to rapidly accelerate the identification of “hematite cap” mineralisation at the Makengui Prospect at Mayoko-Moussondji. The Company is targeting the definition of an initial oxide iron resource in the first quarter of 2012.
The Company has progressed negotiations with the ROC rail authority, Chemin de Fer Congo Ocean (“CFCO”), and the Port Authority of Pointe-Noire (“PAPN”), in accordance with the Agreements Equatorial has signed with both State Agencies. A rail engineering study is being carried out by R&H Railways (“R&H”) from South Africa and results are expected to be released in the coming weeks. Murray & Roberts Marine (“Murray & Roberts”) is finalising a prefeasibility study on the Company’s proposed port development infrastructure and results are expected to be finalised by the end of August 2011.
Significant progress has been made in the provision of infrastructure and logistics requirements of the Company’s exploration and development programs. This has involved the construction of a base camp at Mayoko, transport and logistics solutions being provided, the purchase of light and heavy vehicle fleet, communication infrastructure, and support facilities. The Company has engaged a number of specialist contractors during the quarter who will provide vital services to Equatorial in the development of the Company’s projects.
Field work has commenced at the Company’s 100% owned Badondo Iron Project (“Badondo”) in the North of the ROC. A reconaissance campaign was conducted at the Badondo Prospect and the Belinga North Prospect which included the collection of rock samples and the selection of base camp sites to enable a maiden drilling campaign at Badondo in the fourth quarter of 2011.
Equatorial acquired 19.9% of African Iron Limited (ASX: AKI) through the purchase of 95.4 million ordinary AKI shares. African Iron is the holder of an 80% interest in the Mayoko-Lekoumou Iron Project which lies adjacent to Equatorial’s 100% owned Mayoko-Moussondji Iron Project. There are a number of synergies between the two iron projects afforded by their close proximity and their strategic access to operational transport infrastructure.

ASX: EQX | 29 July 2011 | ASX RELEASE

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Figure 1: Location of Equatorial Resources’ Iron Projects in Republic of Congo

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Figure 2: Location of Iron Exploration Targets at Mayoko-Moussondji Project

MAYOKO-MOUSSONDJI IRON PROJECT

Mayoko-Moussondji is located in the southwest region of the ROC and 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 operational office is located.

Drilling Program Underway

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Figure 3: Drill hole Location Plan – Makengui Prospect

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Figure 4: Partners drill rig at Makengui Prospect

The Company’s current exploration strategy at Mayoko-Moussondji is to identify shallow hematite iron mineralisation with the potential to host DSO and rapidly move into production through the development of an initial 5Mtpa project based on the Company’s access to the existing rail and port infrastructure.

Partners commenced drilling at the Makengui Prospect (“Makengui”) at Mayoko-Moussondji in March 2011. Makengui is 12km long, up to 2km wide and lies 500m from an existing, operational bulk haulage railway line (see Figure 2 overleaf). Partners are using a multipurpose drill rig which is currently configured for diamond drilling.

ASX: EQX | 29 July 2011 | ASX RELEASE

A total of 456.6m of diamond drilling in 3 holes were completed at Makengui (see Figure 3 overleaf). Initial holes are targeting near-surface hematite mineralisation however some are being extended to investigate the underlying magnetite Banded Iron Formation (“BIF”).

The completed diamond drilling and rock exposures from the extensive clearing of drill pads and access roads at Makengui have confirmed the presence of oxide iron mineralisation outcropping at surface and extending to over 70m vertical depth below surface. In addition, the drilling to date has confirmed the presence of both fresh magnetite BIF beneath the oxide cap and detrital oxide iron mineralisation blanketing the flanks of the Makengui ridge line.

These observations have verified the Company’s geological model for the Mayoko-Moussondji iron deposits which is based on previous geophysical modeling (refer ASX announcement 30 November 2010) and indicate that the Company has the potential to rapidly advance its strategy of identifying shallow oxide iron mineralisation that may host DSO and/or mineralisation amenable to simple beneficiation.

SGS Mineral Services (“SGS”) has been contracted to provide assay services to the Company’s projects in the ROC. Equatorial has also contracted SGS to construct and operate a dedicated on-site sample preparation laboratory that will be operational towards the end of 2011. This facility is designed to reduce the freight cost of geological samples by producing small packages of powdered sample ready for analysis. Once operational, prepared samples will be sent from the lab at Mayoko directly to the SGS laboratory in Perth Australia,

Until this facility is established the Company will freight core samples to the SGS laboratory in Johannesburg, South Africa for assay. The first batch of approximately 300 drill core samples from the Makengui prospect will be dispatched from Mayoko in early August, with results expected sometime in September 2011.

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Figure 5: Oxidised iron mineralisation within the initial drilling area at Makengui Prospect

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Figure 6: Fresh magnetite BIF in drill core from hole MMKD002 – Makengui Prospect

ASX: EQX | 29 July 2011 | ASX RELEASE

Expansion of Drilling Program

During the quarter the Company signed a drilling contract with Wallis for a minimum of 28,000m of reverse circulation (“RC”) and diamond core drilling at Mayoko-Moussondji. The contract with Wallis will run in parallel to the existing drilling program already underway with Partners and is intended to rapidly advance the company’s exploration activities.

Wallis has extensive relevant experience and qualified personnel having previously successfully completed major drilling contracts exploring for iron ore in Africa for Sundance Resources Limited and Aquila Resources Limited. Wallis has the technical and financial capacity to deliver the highest level of service and significantly expand and accelerate Equatorial’s exploration activity at Mayoko-Moussondji.

The Wallis program will commence with two rigs: a KL900 truck mounted multi-purpose RC & diamond core drill rig and a Wallis/Alton diamond drill rig mounted to a steel tracked carrier. The contract specifies a minimum of 28,000m of drilling in phase 1, with approximately 8,000m of diamond core drilling and 20,000m of RC drilling. Equatorial has the option to continue with a phase 2 drilling program with Wallis for a further 40,000m, with approximately 10,000m of diamond core drilling and 30,000 meters of RC drilling.

The two Wallis drill rigs have cleared customs in Pointe-Noire and are expected to be operational at Mayoko before the end of the month. With three drill rigs operating from August onwards (2 diamond rigs and 1 RC) it is expected that the Company’s drilling program will advance rapidly.

The Company is targeting the definition of an initial oxide iron resource in the first quarter of 2012.

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Figure 7: Wallis truck mounted multi-purpose RC & diamond drill rig at the Port of Pointe-Noire

Camp Construction & Development

Construction of the Company’s operating base at Mayoko has largely been completed. This logistics center consists of first rate accomodation and catering facilities supporting over 100 daily workers and 28 expatriates and will form the Company’s long term base in the Mayoko region.

These facilities include:

Modularised expatriate standard accommodation for 28 employees and contractors, each equipped with air conditioning units and en-suite bathrooms
Core shed and storage facilities
Canteen and commercial grade kitchen facilities
Industrial grade laundry facilities
Large capacity diesel storage facility
Administration office
Fully-equipped mechanical workshop and maintenance area

ASX: EQX | 29 July 2011 | ASX RELEASE

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Figure 8-13: Camp development at the Mayoko-Moussondji Iron Project

In addition to the numerous camp construction activities, the Company embarked on major civil engineering works to facilitate the accelerated drilling program currently underway. To assist with the design and implementation of civil works, the Company engaged Knight Piesold to prepare and implement a plan for the development of a second phase of base camp facilities as well as road and bridge construction planning.

As part of this plan the Company has engaged a full-time engineering consultant on site at Mayoko to manage the civil works to be carried out during the coming months. Already present on site is local contracting firm SIPAM who have been engaged to carry out clearing work for the preparation of drill pads for the Company’s ongoing drilling campaign. The Company is evaluating a number of proposals from local road and bridge building companies to carry out further works.

Transport Logistics & Mobile Equipment Fleet

The Company has commenced operating a weekly flight service between Pointe-Noire and Moussondjo using a chartered Dornier 228-200 aircraft. The Dornier is a 19 seat, twin engine plane with a maximum payload of 1900kg. The weekly service is operated under contract by Equaflight Service (“EquaFlight”) and allows rapid crew transfer and cargo transport between Pointe-Noire and Mayoko-Moussondji.

The Company has procured an additional 13 light vehicles to support the increased level of activities particularly at Mayoko-Moussondji and to support the increased logistical and transport requirements of the Company’s expanding workforce.

ASX: EQX | 29 July 2011 | ASX RELEASE

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Figure 14: EquaFlight Weekly Charter Figure 15: Selection of vehicle fleet

During the quarter the Company procured a fleet of heavy duty mobile equipment to support the drilling and exploration operations, including clearing, road construction, transport, drill pad preparation activities and camp construction activities. The expansion of the heavy duty mobile equipment fleet included the following items:

MAN 6x6 Prime Mover 33-440, including 70 tonne low loader;
Caterpillar D8RXL Bulldozer;
Caterpillar 725 Articulated Dump Truck;
Caterpillar 140H Motor Grader;
Caterpillar 950H Wheel Loader; and
Caterpillar CS-563E Roller.

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Figure 16 - 19: Mobile Equipment Fleet

ASX: EQX | 29 July 2011 | ASX RELEASE

Communications Infrastructure

During the quarter the Company engaged global network solutions provider ITC Global (“ITC”) to install satellite (VSAT) communications at the Mayoko-Moussondji camp and at the Pointe-Noire corporate office, providing essential communication services between both sites and the corporate head office in Perth. The network is expected to be operational during the September 2011 quarter.

Community Program

Equatorial is engaged in a broad range of community development initiatives in Mayoko and the surrounding regions. The Company published its Employment Charter and Corporate Values Statement in Mayoko to promote and foster transparent and equitable human resource practices and safe working conditions for its staff.

During the quarter the Company recruited a highly experienced Community Liaison Officer who is based full time at Mayoko. A long term Community Development Plan is being drafted in conjunction with local leaders, community groups and Environmental and Social Impact consultants with a strong focus on skills development initiatives, education and malaria prevention and treatment. In June 2011 the Company made significant upgrades and donations to the Mayoko Clinic, focusing on the provision of malaria treatments and the supply of basic vaccinations. The donations were made at a ceremony in Mayoko which was later reported in the Congo’s national newspaper “Les Depeches de Brazzaville” (see Figure 21 below).

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Figure 20: Press Coverage of the Community Development work at Mayoko

Environmental Study

Equatorial is committed to the highest global standards of social responsibility and sustainable development. The Company submitted its Sustainable Development Charter to the ROC Government in December 2010 and has been working closely with the Ministry of Forestry, the Ministry of the Environment, departmental authorities in Niari as well as local community leaders and companies to ensure stakeholders are aware and supportive of the Company’s development plans and that operations are carried out with transparency and respect for the various stakeholder needs.

The Company has partnered with local environmental consulting firm EcoDurable to carry out initial Scoping and Baseline work, with permanent representatives now active on site at Mayoko. During the quarter, the Company

ASX: EQX | 29 July 2011 | ASX RELEASE

awarded a tender to a joint bid by SRK Consulting (UK) Ltd (“SRK”) and Genivar to join Ecodurable in the finalisation of the Scoping and Baseline studies in the coming months.

These Studies will form the basis of a detailed Terms of Reference that will be submitted to the ROC Government for the full Environmental and Social Impact Assessment Study.

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Figure 21-22: Scoping and Baseline Environmental Impact Studies Commence at Mayoko

Transport Infrastructure

During the quarter Equatorial continued to work with R&H to develop an Operations Blueprint for a 5mpta iron operation based on the existing rail infrastructure that intersects the Mayoko Project and connects it to the deep water port of Pointe-Noire some 450km away.

These studies were contemplated in the Agreement signed between the Company and the state owned railway entity CFCO in September 2011 in order to determine the cost and operating parameters for the transport of iron by existing rail from Mayoko to the port of Pointe-Noire. The Company has been working closely with a team of engineers appointed by the CFCO as well as with consultants from R&H to finalise the study, which will form the basis of a Commercial Contract to be signed between the Company and the CFCO in the near future.

In addition to its work on the railway system, the Company is working with a team of engineers from Murray & Roberts in conjunction with materials handling specialists Demcotech Engineering, both from South Africa, to conduct a pre-feasibility study in relation to the Company’s export loading and stockpiling facilities from the deep water port of Pointe-Noire. The studies were contemplated in the Agreement between the Company and the state owned PAPN in which the parties undertook to cooperate in investigating and implementing the infrastructure required to export iron from the Company’s Mayoko-Moussondji Iron Project (see ASX announcement 4 February 2011).

Equatorial expects to receive the results of both the rail study and port study during the coming quarter and will be released to the market when received.

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Figure 23: Existing railway through Mayoko

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Figure 24: Port of Pointe-Noire

ASX: EQX | 29 July 2011 | ASX RELEASE

Contractors

The Company has engaged a number of specialist contractors during the quarter who will provide vital services to Equatorial in the development of the Company’s projects.

The Company has engaged civil engineering contractor SIPAM SA (“SIPAM”) for road building, clearing work and drill pad preparation across the Mayoko-Moussondji Iron Project area with machinery currently in operation at the Makengui Prospect.

Equatorial engaged Knight Piesold Consulting (“Knight Piesold”) from South Africa to prepare and implement a plan for the development of a second phase of base camp facilities as well as road and bridge construction planning.

Equatorial has contracted France based CIS Catering (“CIS”) to provide catering and housekeeping services to resident staff at Mayoko-Moussondji and engaged ERINYS Congo SARL (“ERINYS”) to provide security services on site at the camp.

SGS Mineral Services (“SGS”) have been contracted to provide assay services to the Company’s projects in the ROC. Equatorial has also contracted SGS to construct and operate a dedicated on-site sample preparation laboratory at Mayoko that will be operational towards the end of 2011.

Equatorial has contracted Italian aviation company, Air Walser, to provide helicopter services to the Company. The helicopter service is based in Gabon and will be used for reconnaissance, transport, and supply missions to the Badondo Iron Project as well as including permanent MEDIVAC emergency service to both Mayoko and Badondo.

As mentioned above, the Company awarded a tender to a joint bid by SRK and Genivar to join Ecodurable in the finalisation of the Scoping and Baseline Environmental and Social Impact studies in the coming months.

A complete list of the contractors engaged during the June quarter is as follows:

CONTRACTOR

Wallis Drilling
SIPAM
Knight Piesold Consulting
SRK Consulting (UK) Ltd
CSA Global
SGS Mineral Services
ERINYS Congo SARL
CIS Catering
EquaFlight Services
Air Walser
ITC Global

SERVICE

Drilling services at Mayoko-Moussondji Road works at Mayoko-Moussondji Civil engineering consulting at Mayoko-Moussondji Environmental consulting Technical and geological consulting Laboratory assay services Security services at Mayoko-Moussondji Catering and housekeeping at Mayoko-Moussondji Weekly air charter from Pointe-Noire to Moussendjo Aviation services – helicopter Satellite communications

ASX: EQX | 29 July 2011 | ASX RELEASE

BADONDO IRON PROJECT

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 (refer ASX announcement 28 March 2011). The project is located within a regional cluster of world-class iron ore exploration projects including Sundance Resources Ltd’s (ASX:SDL) Mbalam and Nabeba projects.

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Figure 25: Equatorial Resources Project Location Plan

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Figure 26: Badondo Iron Project location

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Figure 27: Badondo Iron Project – Exploration Target

ASX: EQX | 29 July 2011 | ASX RELEASE

Badondo Field Work and Development Plans

During the quarter the Company commenced with its planned field campaign at Badondo. The field work included a number of helicopter supported reconnaissance missions that allowed the Company to visually confirm the findings of the 2007 BRGM study as well as the results of the Company’ airborne geophysics survey in 2010. In addition, the Company was able to target areas suitable for the development of base camps near the Badondo Prospect and the Belinga North Prospect to support further field work and drilling campaigns. Helicopters are being contracted from Air Walser on a monthly basis from a base in Libreville, Gabon, providing the Company with a minimum of 5 hours of contracted flight time per month.

A team of geologists from SRK Consulting in Perth Australia have been engaged to conduct a comprehensive geological mapping program over part of the Badondo Iron Project tenement commencing in September 2011. The aim of the mapping program is to produce high quality geological and structural maps of the two principal iron ore prospects that will be used to define an initial scout diamond drilling program targeting potential DSO iron mineralisation.

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Figure 28: Helictoper-supported mission near Belinga North Prospect

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Figure 29: Badondo Prospect Schematic

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Figure 30: Geologists, Badondo Field Campaign 2011

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Figure 31: Helicopter view of the Belinga North Prospect

Badondo Drilling Program

Drilling at Badondo is planned to commence before the end of 2011. The Company is in the process of finalising the acquisition of a 2100 helicopter transportable drill rig from EVH Drill Engineering Pty Ltd in Perth, Australia.

CORPORATE

Pointe-Noire Head Office

Equatorial has secured new office premises in the port city of Pointe-Noire that will form the ideal platform for the Company’s administrative operations in the ROC through to production. The offices are located at the center of the

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commercial district of Pointe-Noire and have the advantage of overlooking the deep-water Port and the railway line that connects northwards to Mayoko- Moussondji.

Human Resources

In addition to the executive team at the Perth head quarters, Equatorial now employs more than 120 empolyees in the Republic of Congo and has strenghtened the techincal team with the addition of 3 senior geologists, camp management staff and environmental consultants.

The following appointments have been made during the quarter:

Senior Geologists
Environmental Consultants
Project Infrastructure Manager
Finance Manager
HR Manager
Camp Managers
Manager of Site Security, Community Relations & Medical
Maintenance Supervisor
Accountant
Bookkeeper
Logistics Personnel
Drilling Personnel
Field Services Personnel (Road & Clearing Crew)
Geology Personnel
Camp Personnel
Medical & Security Personnel

Government Relations

During the quarter senior Company executives met on several occasions with the Minister of Mines of the ROC and other senior governmnet officals to update them on progress. Equatorial has commenced the process of negotiating an Establishment Convention and an Employment Convention Collective with the Government of the ROC. It is intended that Equatorial will present to the ROC investmnet committee at their Decempber meeting. The Company continues to have a very positive relationship with the Ministry of Mines and all areas of the ROC government.

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Figure 32: John Welborn, MD & CEO and Minister Pierre Oba, Minister of Mines, ROC

Figure 33: Equatorial’s new in country offices, Pointe-Noire, ROC

ASX: EQX | 29 July 2011 | ASX RELEASE

Acquisition of 19.9% Interest In African Iron Limited

On 30 June 2011 the Company announced it had acquired 19.9% of the ordinary share capital of African Iron Limited (ASX: AKI) (“African Iron”) through the purchase of 95.4 million ordinary AKI shares. African Iron is the holder of an 80% interest in the Mayoko-Lekoumou Iron Project which lies adjacent to Equatorial’s 100% owned Mayoko-Moussondji Iron Project. The Company is extremely pleased to have acquired this strategic stake in African Iron. In the longer term the Company believes there are a number of synergies between the two iron projects afforded by their close proximity and their strategic access to operational transport infrastructure.

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Figure 34: Location Plan of African Iron and Equatorial’s Mayoko Iron Projects

Cash Position and Shareholder Information

The Company is in a strong position with significant cash reserves and no debt. As at 30 June 2011 the Company had cash and securities of A$79.1 million.

As at 30 June 2011 the Company had 1,822 shareholders and 101,517,922 ordinary fully paid shares on issue with the top 20 shareholders holding 73.79% of the total issued capital.

The Board of Equatorial notes the recent takeover offer for Sundance Resources Limited and the increased corporate interest generally in West African Iron Projects. Equatorial remains focused on adding value to the Company’s assets at Mayoko and Badondo and accelerating exploration and development activity to create a major West African iron company.

For all enquiries please contact:

John Welborn | Managing Director & CEO Telephone: +61 8 9322 6322 | Email: [email protected] Web: www.equatorialresources.com.au

ASX: EQX | 29 July 2011 | ASX RELEASE

APPENDIX 1: DRILL HOLE DATA – MAYOKO-MOUSSONDJI PROJECT

Prospect	Hole ID	Northing	Easting	RL	Azimuth	Dip	Total Length	Metres	Metres	Assay Results
		WGS84 Zone 33S			Degrees		m	HQ	NQ
Makengui	MMKD001	9743138	246231	709	360	‐70	98.9	49.1	49.8	Assayspending
Makengui	MMKD002	9743421	247407	712	180	‐60	231.3	74.6	156.7	Assayspending
Makengui	MMKD003	9743360	247590	794	360	‐70	126.4	77.7	48.7	Assayspending
						Total	456.6	201.4	255.2

Notes

All hole collars surveyed by handheld GPS

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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 operational 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.

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For further information contact:

John Welborn

Managing Director & CEO Telephone: +61 8 9322 6322 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 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.

The information in this report that relates to Exploration Results, other than 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.

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

Name of entity
EQUATORIAL RESOURCES LIMITED
ABN 50 009 188 694	Quarter ended (“current quarter”)
50 009 188 694	30 JUNE 2011

Consolidated statement of cash flows
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) - Business development - Settlement proceeds Net Operating Cash Flows	Current quarter $A’000	Year to date (12 months) $A’000
	(2,700) - - (869) - 575 - - (40) -	(4,859) - - (2,154) - 932 (14) - (315) 1,028
	(3,034)	(5,382)
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)	- (3,383) (2,860) - - - - - -	(471) (3,383) (3,817) - - - - - -
	(6,243)	(7,671)
	(9,277)	(13,053)

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)	(9,277)	(13,053)
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): - Capital raising expenses Net financing cash flows	3,025 - - - - (1,483)	72,409 - 100 (600) - (3,128)
	1,542	68,781
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 of quarter	(7,735) 63,995 (26)	55,728 591 (85)
	56,234	56,234

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
		173
		-
1.25	Explanation necessaryfor an understandingof the transactions
	Payments include directors’ fees, superannuation, company secretarial services and provision of a fully serviced office.

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
	Not applicable

2.2	Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest
	Not applicable

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
	-	-
	-	-

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	5,149
	-
	-
	917
Total	6,066

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as	Current quarter	Previous quarter
shown in the consolidated statement of cash flows) to	$A’000	$A’000
the related items in the accounts is as follows.
5.1 Cash on hand and at bank	14,125	34,903
5.2 Deposits at call	42,109	29,092
5.3 Bank overdraft	-	-
5.4 Other (provide details)	-	-
Total: cash at end of quarter(item 1.22)	56,234	63,995

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
	Not applicable
	Not applicable

See chapter 19 for defined terms.

Appendix 5B Page 3

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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)	Amount paid up per security (see note 3)
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	101,517,922	101,517,922	N/A	N/A
	100,000	100,000	$0.25	$0.25
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	50,000 100,000 200,000 150,000 100,000 2,400,000 3,900,000 3,900,000 586,800	- - - - - - - -	Exercise price $2.335 $2.835 $2.00 $3.00 $4.00 $0.25 $0.40 $0.60 $0.82	Expiry date 4 Aug 2011 31 Dec 2012 30 Jul 2013 30 Jul 2013 30 Jul 2013 30 Jun 2012 30 Jun 2013 31 Dec 2013 31 Oct 2012

	100,000	-	$0.25	$0.25

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 ~~/does not~~ * (delete one) give a true and fair view of the matters disclosed.
Sign here:............................................................ Date: 29 July 2011 ( ~~Director~~ /Company secretary)

Print name: Greg Swan

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

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AI assistant

EQUATORIAL RESOURCES LIMITED — Interim / Quarterly Report 2011

64870_rns_2011-07-28_31142802-c9ba-41c9-b2e2-fd48c1cf8aca.pdf

ASX: EQX | 29 July 2011 | ASX RELEASE

JUNE 2011 QUARTERLY REPORT

HIGHLIGHTS

MAYOKO-MOUSSONDJI IRON PROJECT

Drilling Program Underway

Expansion of Drilling Program

Camp Construction & Development

Transport Logistics & Mobile Equipment Fleet

Communications Infrastructure

Community Program

Environmental Study

Transport Infrastructure

Contractors

CONTRACTOR

SERVICE

BADONDO IRON PROJECT

Badondo Field Work and Development Plans

Badondo Drilling Program

CORPORATE

Pointe-Noire Head Office

Human Resources

Government Relations

Acquisition of 19.9% Interest In African Iron Limited

Cash Position and Shareholder Information

APPENDIX 1: DRILL HOLE DATA – MAYOKO-MOUSSONDJI PROJECT

ABOUT EQUATORIAL RESOURCES

John Welborn

Appendix 5B

Mining exploration entity quarterly report

Name of entity

Appendix 5B Mining exploration entity quarterly report

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

Non-cash financing and investing activities

Financing facilities available

Estimated cash outflows for next quarter

Reconciliation of cash

Changes in interests in mining tenements

Issued and quoted securities at end of current quarter

Compliance statement

Notes

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EQUATORIAL RESOURCES LIMITED Interim / Quarterly Report 2011