ESTRELLA RESOURCES LIMITED — Interim / Quarterly Report 2012

Oct 30, 2012

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QUARTERLY REPORT

Quarter ending 30 September 2012

HIGHLIGHTS

• Promising initial assay results received from the Orion Prospect within the Agustina Project show the potential for a significant IOCG target;

• High grade gold results from the Venus Project sampling program being consistent with previous results at the Centauri Prospect; and

• Secured highly prospective new project “Jupiter” in Region III of northern Chile.

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Quarterly Report- 30 September 2012
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Estrella Resources limited (ASX: ESR) (Estrella or Company) is pleased to provide its Exploration Activities and ASX Appendix 5B for the quarter ending 30 September 2012.

1. EXPLORATION ACTIVITY

1.1. Agustina Project (100% owned) Orion Prospect

Mineralisation at the Orion Prospect was tested at two separate targets, the first target being the large geophysical anomaly Induced Polarisation (IP Anomaly Target) and the second beneath the existing underground terraced mine adits.

1.1.1. IP Anomaly Target

Hole ORI-03 was drilled (60[o] dip towards 055[o] ) to test for mineralisation at the IP Anomaly Target located on the south east corner of the Orion Prospect. The results for this hole returned significant mineralisation (>0.1% Cu) over an 18m interval. Interpretation of the results suggests that Hole ORI03 did not penetrate the core of the mineralised body but rather intersected its “outer shell”.

Following completion of the maiden drilling program, Estrella retained Zonge Ingenieria y Geofisica (Chile) S.A, a recognised Chilean based geophysical consultancy firm (Zonge), to undertake an independent geophysical appraisal of the IP anomaly at the Orion Prospect. The independent report from Zonge Ingeneria y Geofisica (Chile) S.A. confirmed the prospectivity of the Orion Prospect and strongly recommended that additional drilling be undertaken at the IP Anomaly Target. Subsequent to this quarter, the Company announced it will recommence drilling the first week of November 2012. Figure 1 illustrates the 3D representation of the IP Anomaly and drill hole locations of the Hole ORI03 and the proposed new holes.

Figure 1: IP Anomaly at Orion Prospect and proposed drill hole locations

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N
1 km
New Holes
Hole ORI-03
gu
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Quarterly Report- 30 September 2012
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1.1.2 Terraced Mine Adit Target

Holes ORI-01, ORI-02 and ORI-04 were drilled to test for potential mineralisation beneath the existing underground terraced mine adit at Orion Prospect. Whilst mineralised zones were intersected in all three holes, the results suggest that these zones do not increase in width at depth nor carry sufficiently high copper grades to be economically extracted. As a result, it is unlikely additional exploration work will be undertaken at this target. (See Figure 2)

Figure 2: Traverse across Orion Prospect terraced mine adits

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1.2. Agustina Project (100% owned) Centauri Prospect

At Centauri, trench cutting was attempted during the September 2012 quarter. However, rocky ground conditions prevented an effective trench from being dug. As an alternative, metre interval sampling was performed along the entire underground access drive. A total of 57 samples were collected as part of this program. Significant gold results were found in a 6m interval which included gold values up to 19.28 g/t. Further sampling programs are planned to test for repeats of high grade gold veins beyond the limits of the underground working.

1.3. Venus Project (100% owned)

During the quarter, reconnaissance field mapping and sampling were undertaken at Venus Project to assess the potential for similar structurally bound high grade gold mineralisation as those found at the Centauri Prospect within Agustina Project. Venus Project directly abuts Agustina Project and the area being explored lies to the South East of Centauri Prospect (See Figure 3). The results received to date illustrates that high grade gold is associated with structures on similar trend to those found in Centauri. These trends cover a collective strike length of 9km.

The fire assay results for the grab samples from Venus Project were received in late September. Table 1 on the following page lists the significant results from the program.

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Quarterly Report- 30 September 2012
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Table 1: Venus Project (note: 42 samples were tested, below tabulates the significant results for values >0.5g/t)

Sample	Au g/t
1	6.98
2	4.63
3	1.62
4	0.62
5	2.04
6	3.32
7	3
8	3.48
9	3.4
10	2.41
11	2.27
12	0.67
13	0.55
14	1.91
15	0.63
16	4.52
17	0.69

Figure 3: Location Map with significant gold results for Centauri Prospect and Venus Project

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Quarterly Report- 30 September 2012
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1.4. Jupiter Project (100% owned)

Subsequent to the quarter, Estrella further extended its total tenement holding in Chile. The new ground known as ‘Jupiter’ covers a total area of 17.5km[2] and is located in Region III of northern Chile, 670km north of Santiago. The Company was able to secure the project for nominal cost by becoming the primary applicant for the tenement with the relevant statutory authorities. (See Figure 4)

Jupiter Project is a particularly prospective tenement as the area is situated within the Cu-Au Metallogenic belt of the Cretaceous to Palaeocene period. This belt hosts many significant deposits including Freeport McMoran’s Candelaria and Punta de Cobre mine. Region III is also well-known for the Maricunga belt that hosts Kinross’s Maricunga.

The geology of the Jupiter Project is consistent with that of the surrounding area which hosts clusters of mineralised breccia pipes. These breccia pipes have been observed to extend up to 400m in diameter and are often visible at surface. Whilst very little exploration work has been undertaken on the Jupiter Project itself, historical drilling in nearby tenements has shown thick intersection with significant copper mineralisation within these breccia pipes.

An initial exploration program is currently underway at the Jupiter Project involving reconnaissance mapping and detailed sampling programs. It is expected this initial program will generate a number of priority targets and would be followed up by a subsequent drill program.

Figure 4: Jupiter Project and geology

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Quarterly Report- 30 September 2012
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1.5. Luna Project (100% owned) (Including Inca Project 91.5% owned)

Luna now covers an area of 258.25km[2] as 3.75km[2] was voluntarily relinquished during the quarter.

Estrella is currently progressing stream sampling and mapping over the project area to improve the geological knowledge and better assess future exploration targets.

2. COMMENTARY

Estrella's Managing Director, Dr. Jason Berton, currently in Chile said:

“The September 2012 quarter has been a busy one for Estrella. We have made significant progress in our exploration efforts on both Agustina and Venus. The drilling results received from the IP Anomaly target has given further encouragement that a significant IOCG deposit may be present at Agustina. We have recently commenced an aggressive follow up program and look forward to bringing you further updates as results come to hand.

“We have also continued to add quality tenure to our portfolio of highly prospective tenements in Chile. Jupiter represents an exciting new project for the Company in an area known for its prospectivity. We have commenced a high level exploration program at Jupiter and expect to move forward rapidly with positive results.”

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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
		Estrella Resources Limited
	ABN	Quarter Ended (''Current Quarter'')
39	151 155 207	30 September 2012

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 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 (provide details if material) Net operating cash flows	Current	Year to date (3 months) $A’000
	quarter
	$A’000
		- (366) - - (383) - 50 - - -
	-
	(366)
	-
	-
	(383)
	-
	50
	-
	-
	-
	(699)	(699)
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 1.1 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other- Project Option Fees Net investing cash flows		- - (3) - - - - - (74)
	-
	-
	(3)
	-
	-
	-
	-
	-
	(74)
	(77)	(77)
1.15 Total operatingand investingcash flows(carried forward)	(776)	(776)

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ESTRELLA RESOURCES LIMITED- APPENDIX 5B 30 SEPTEMBER 2012

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1.15Totaloperating andinvesting cash flows (brought forward)		(776)
	(776)
Cash flows related to financing activities 1.16 Proceeds from issues of shares, options, etc. 1.17 Proceeds from sale of forfeited shares 1.18 Proceeds from borrowings 1.19 Repayment of borrowings 1.20 Dividends paid 1.21 Other – Capital raising costs Net financing cash flows		- - - - - -
	-
	-
	-
	-
	-
	-
		-
	-
Net increase (decrease) in cash held 1.22 Cash at beginning of quarter/year to date 1.23 Exchange rate adjustments to item 1.2 1.24Cashatend ofquarter		(776) 5,106 23
	(776)
	5,106
	23
		4,353
	4,353

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

1.25 1.26	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
		104
		-
1.27	Explanation necessary for an understanding of the transactions
	Directorsfees /salaryfor the period:$104

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

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
		-
	-
		-
	-

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ESTRELLA RESOURCES LIMITED- APPENDIX 5B 30 SEPTEMBER 2012

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Estimated cash outflows for next quarter 4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration Total
	$A’000
	300
	-
	-
	349
	649

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 Commercial Bills 5.4 Other: Term Deposit Total: cash at end of quarter (item 1.22)		647
	454
		4,459
	3,899
		-
	-
		-
	-
		5,106
	4,353

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			Interest	Interest at end of quarter
	Tenement reference	Nature of interest
			at beginning
			ofquarter
		Part of Luna being first preference rights		258.25km2
	Luna		262km2
	None

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ESTRELLA RESOURCES LIMITED- APPENDIX 5B 30 SEPTEMBER 2012

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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.

		Number quoted		Amount paid up per security (see note 3)
			Issue price per security (see note 3)
	Total Number
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	87,101,000	45,912,500
7.5 Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7 Options Unlisted Unlisted Unlisted Unlisted Unlisted			Exercise price
				Expiry date
	3,600,000	-	25 cents	12-Sep-14
	1,000,000	-	25 cents	25-Oct-14
	505,000	-	20 cents	19-Dec-16
	600,000	-	20 cents	25-Oct-16
	1,500,000	-	20 cents	9-May-17
7.8 Issued during quarter 7.9 Exercised during quarter 7.1 Expired during quarter 7.11 Debentures (totals only) 7.12 Performance Rights (totals only) 7.13 Unsecured notes (totals only)

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ESTRELLA RESOURCES LIMITED- APPENDIX 5B 30 SEPTEMBER 2012

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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 give a true and fair view of the matters disclosed.

Sign here:

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Date: 31 October 2012

Print name: Justin Clyne- Company Secretary

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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ESTRELLA RESOURCES LIMITED- APPENDIX 5B 30 SEPTEMBER 2012