EVOLUTION MINING LIMITED — Interim / Quarterly Report 2012

Jan 24, 2012

Quarterly Report

For the period ending December 2011

Highlights

• Successful completion and implementation of the merger between Catalpa Resources and Conquest Mining and the concurrent purchase of Newcrest Mining Limited's interests in the Cracow and Mt Rawdon gold mines in Queensland on 2 November 2011

• Creation of the fourth largest ASX-listed gold producer targeting full year production of 335 – 375koz gold in FY2012 (265 – 300koz attributable)

• Successful entitlements offer raising A$152.4M and cash flow increased the cash position to A$167M at 31 December 2011 – in addition, at year end, the Company held gold and silver yet to be sold of approximately A$19.8M

• Operational scale and diversity; total quarterly gold production of 89,812oz – attributable[1] quarterly gold production of 74,095oz at a cash cost of A$760/oz

• Effective cost reduction; outstanding gold production from Pajingo delivering a total quarterly production of 26,068oz; attributable[1] gold production of 21,229oz at a cash cost of A$535/oz (Conquest Mining Limited Sep 2011 qtr: 14,049oz at A$889/oz)

• Group production and costs remain in line with FY2012 guidance

• Mt Carlton construction commenced and first concentrate production is on schedule for December quarter 2012. The project is expected to deliver 800,000oz of gold, 17.3Moz of silver and 34,000t of copper over 12 years at an average cash cost of A$600/oz (after by-product credits) further reducing the Company’s cost profile

• Exploration and resource definition drilling continued to infill and extend Mineral Resources with best results received from Cracow (11m grading 6.76g/t gold indicating a potential new zone adjacent to Kilkenny North) and Pajingo (4.6m grading 44.9g/t gold indicating a new zone adjacent Sonia East)

1Attributable production :2 November 2011 - Cracow from 30% to 100%, 100% of Mt Rawdon 18 October 2011 - Pajingo 100% .

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OPERATIONS

Improvement to safety continues to be a key focus for the group with two Lost Time Injuries (“LTIs”) reported during the quarter at Pajingo. Evolution Mining is committed to building a strong and participative safety culture and is implementing programs towards this goal.

Combined quarterly gold production of 89,812oz was in line with FY2012 guidance. Attributable gold production accounting for direct ownership of assets was 74,095oz at a cash cost of A$760/oz.

Production for the March 2012 quarter is expected to be similar to the December 2011 quarter performance.

December Quarter Consolidated Gold Production Summary

	Units	December Quarter 2011	FY2012 Year to Date
Total gold produced	oz	89,812	165,708
Attributable gold produced1	oz	74,095	99,130
Total silver produced	oz	45,972	122,020
Attributable silver produced1	oz	39,320	48,227
Attributable Cash Cost2	A$/oz	760	819
Attributable Total Cost3	A$/oz	1,035	1,084
Achieved gold price	A$/oz	1,632	1,656

1. Includes increased interest in Cracow from 30% to 100% on 2 November 2011, 100% of Mt Rawdon from 2 November 2011, and 100% of Pajingo from 18 October 2011

2. Before royalties and after silver credits

3. Includes cash costs, depreciation, amortisation, royalties and exploration

Cracow, Queensland (100%)

An excellent safety record was maintained with no LTIs at Cracow.

Cracow continued to perform well and to provide consistent cash flow delivering total gold production of 25,724oz with attributable gold production of 20,492oz at a cash cost of A$637/oz in the December 2011 quarter. Ore was sourced from Sovereign, Phoenix, Kilkenny, North Klondyke, Royal and first ore was produced from Roses Pride.

Edna May, Western Australia (100%)

Safety performance improved at Edna May with no LTIs reported.

In the December 2011 quarter Edna May produced a total of 20,006oz of gold (100% attributable) at a cash cost of A$1,044/oz. Whilst this is an improvement on the September 2011 quarter, production was marginally below guidance as a result of lower than expected mill throughput which impacted gold production and resulted in higher than expected unit cash costs.

A number of initiatives have commenced at Edna May to improve the plant performance and to sustainably increase throughput. This includes improving plant reliability and efficiency and mine to mill optimisation. It is expected that these improvements will occur over the next 12 months.

Production in the March quarter 2012 is expected to be similar to this quarter.

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Mt Rawdon, Queensland (100%)

There were no LTIs at Mt Rawdon during the quarter, continuing the operation’s excellent safety record.

In the December 2011 quarter Mt Rawdon produced a total of 18,014oz with attributable gold production of 12,367oz at a cash cost of A$893/oz. Gold production was below expectation due to lower gold feed grades associated with mining delays and unscheduled maintenance to the process plant. Unit cash costs continue to be impacted by lower feed grades resulting from lower mining rates than scheduled.

Production for the March quarter 2012 is expected to continue to improve as mining progresses toward higher grade ore sources.

Pajingo, Queensland (100%)

There were two LTIs recorded at Pajingo during the quarter. A number of safety initiatives are in place to improve safety performance.

Gold production for the December 2011 quarter was outstanding at 26,068oz (21,229oz attributable), representing a significant increase on the previous quarter’s production and at a significantly reduced cash cost of A$535/oz (Conquest Mining Limited Sep 2011 qtr: 14,049oz at A$889/oz). This was the best quarter’s production since Newmont owned the asset in 2008. Production was well above expectations due to high grade mill feed sourced from underground (Sonia orebody) and Janet A open pit together with higher mill throughput compared to the previous quarter. Higher gold production resulted in lower unit cash costs.

December Quarter Gold Production Summary

						Total/ Average
December 2011 Quarter	Units	Cracow	Edna May	Mt Rawdon	Pajingo
UG ore mined	000' t	116	-	-	92	207
UG mined grade	g/t	6.50	-	-	8.81	7.52
OP ore mined	000' t	-	617	1,194	52	1,863
OP mined grade	g/t	-	1.13	0.75	3.09	0.94
Total ore production	000' t	116	617	1,194	144	2,071
Total tonnes treated	000' t	133	623	811	133	1,700
Head grade	g/t	6.44	1.11	0.76	6.57	1.79
Gold recovery	%	93.3	90.1	91.0	96.0	92.9
Total gold produced	oz	25,724	20,006	18,014	26,068	89,812
Attributable gold produced1	oz	20,492	20,006	12,367	21,229	74,095
Total silver produced	oz	n/a	5,108	12,765	28,099	45,972
Attributable silver produced	oz	-	5,108	11,996	22,216	39,320
Attributable Cash Cost2	A$/oz	637	1,044	893	535	760
Attributable Total Cost3	A$/oz	1,023	1,268	1,030	831	1,035
Achieved gold price	A$/oz	1,646	1,573	1,659	1,642	1,632
Attributable Cash Cost2	US$/oz	647	1,060	906	543	772
Attributable Total Cost3	US$/oz	1,038	1,287	1,045	844	1,051
Achieved gold price	US$/oz	1,670	1,597	1,683	1,667	1,656

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Year to Date Gold Production Summary

						Total/ Average
July 2011 to December 2011	Units	Cracow	Edna May	Mt Rawdon	Pajingo
Total tonnes treated	000' t	266	1,220	1,697	222	3,405
Head grade	g/t	6.59	1.07	0.74	5.92	1.65
Gold recovery	%	92.73	88.69	90.19	96.0	92.1
Total gold produced	oz	52,231	37,089	36,565	39,823	165,708
Attributable gold produced1	oz	28,444	37,089	12,367	21,229	99,130
Total silver produced	oz	n/a	14,015	56,038	51,967	122,020
Attributable silver produced	oz	-	14,015	11,996	22,216	48,227
Attributable Cash Cost2	A$/oz	630	1,101	893	535	819
Attributable Total Cost3	A$/oz	1,008	1,306	1,030	831	1,084
Attributable Cash Cost2	US$/oz	649	1,135	921	552	844
Attributable Total Cost3	US$/oz	1,039	1,346	1,062	857	1,118

1. Includes increased interest in Cracow from 30% to 100% on 2 November 2011, 100% of Mt Rawdon from 2 November 2011, and 100% of Pajingo from 18 October 2011

2. Before royalties and after silver credits

3. Includes cash costs, depreciation, amortisation, royalties and exploration

DEVELOPMENT

Mt Carlton, Queensland (100%)

Project construction commenced following government mining approval for the Mt Carlton gold-silver-copper project. The Mt Carlton project is expected to produce 800,000oz of gold, 17.3Moz of silver and 34,000t of copper over a current mine life of 12 years.

Commissioning of the Mt Carlton process plant is on schedule to commence in December 2012 quarter and is anticipated to contribute 95,000oz gold equivalent per annum to Evolution Mining’s annual production at a cash cost estimate of A$600/oz after by-product credits, significantly reducing the Company’s cost profile.

Construction activities that commenced during the quarter include:

• Finalisation of access roads, creek crossings and power-line access road upgrades;

• Installation of permanent accommodation facility;

• Finalisation of communications link;

• Construction of small water control dams;

• Mobilisation of concrete civil contractor;

• Plant site earth works;

• SAG shell delivery to site;

• Implementation of Environmental Monitoring

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Construction commences at Mt Carlton
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Edna May, Western Australia

Underground Trial Mining

The underground mining approvals process continued with the submission to the Western Australian Government of the Mining Proposal and the Project Management Plan. Sustainable increases in plant throughput have been prioritised at Edna May and as a result commencement of the trial underground mining project at Edna May is on hold until later in 2012.

Western Bore field Project

Approval was gained for the construction of a process water bore field 15km west of the Edna May Gold Operation. The A$9.2M project will supply approximately 40l/s of water to the process plant increasing water security and reducing reliance on the water reservoir contained within the historic underground workings. The project will be completed in the June quarter 2012.

EXPLORATION

Cracow, Queensland

Resource Definition

Resource definition drilling to support an upgrade of the Kilkenny and Tipperary Mineral Resources at Cracow was undertaken during the quarter.

Underground resource definition drilling continued at the Kilkenny Shoot with 21 holes for 2,479.4m being completed. The results to date at Kilkenny are in line with expectations, and drilling remains on track to achieve the conversion of Inferred Resource to Indicated status. Significant results returned to date included:

• KKU176: 14.5m (11.63m)[1] grading 10.25g/t Au from 96m

• KKU180: 26.5m (13.7m)[1] grading 14.22g/t Au from 94.8m

• KKU182: 24.8m (12.05m)[1] grading 12.74g/t Au from 106.2m

At Tipperary, 17 holes were drilled for a total of 2,492m. Significant results included:

• KKU192: 4.3m grading 13.40g/t Au from 103m

• KKU194: 8.5m grading 15.52g/t Au from 91m

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Assays for 13 holes of resource definition drilling during the September 2011 quarter at Klondyke North were received. The results returned to date at Klondyke are broadly in line with expectations, and indicate potential for a small mineralised shoot adjacent existing mine infrastructure. Significant results include:

 KNU084: 6.5m (2.53m)[1] grading 8.83g/t Au from 69.9m Note:[ 1.] Estimated true width

Mine Lease Exploration

At Kilkenny potential exits to define an additional steep-plunging ore shoot along strike to the north (Figure 1). Exploration drill hole CBK317R intersected several zones of strong epithermal quartz-carbonate veining approximately 250m north of active mining operations. Further definition of the potential ore shoot is planned for the next quarter.

Best intersections included:

• CBK317R: 2.03m[1] grading 7.59g/t Au from 563.3m (Footwall splay)

• CBK317R: 11.02m[1] grading 6.76g/t Au from 625m (Kilkenny Structure)

• CBK317R: 1.74m[1] grading 5.47g/t Au from 665m (Hanging wall splay)

Note:[ 1.] Estimated true width

At Klondyke South two holes were drilled to test mineralisation to the south of Royal shoot. KDD255 returned 2m grading 1.06g/t gold from 703.8m. Two drill holes at the south end of the Fordee structure returned no significant assay results.

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Figure 1: Schematic longitudinal section of Kilkenny illustrating target area

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Regional Exploration

The remaining assays from a seven RC hole program completed at Cracow South in June were returned during the quarter. Hole KRC094 intersected 8m grading 1.21g/t gold from 128m with elevated epithermal pathfinders elements. Further exploration is planned to follow-up this result during 2012.

At the Walhalla prospect hole KRC060 intersected a mineralised zone of 2m grading 4.88g/t gold from 372m. A second hole planned to intersect the same epithermal vein along was completed during the quarter and assays are pending. Significant intersections returned during the quarter are presented in Table 1.

Edna May, Western Australia

Resource Definition

Eleven diamond holes for 3,539m were drilled during the quarter to test lateral and depth extensions to mineralisation and upgrade areas of Inferred Mineral Resource to Indicated.

The area targeted was 350m to 400m below surface with drilling intersecting mineralisation in line with expectations and further confirmed the new structural interpretation of the Edna May reef system undertaken in May 2011. Significant results are presented in Table 1 with best results including:

• EMD053: 1.40m grading 34.57g/t Au from 456.7m

• EMD055: 1.70m grading 29.45g/t Au from 457.6m

• EMD062: 4.65m grading 56.19g/t Au from 375.7m

Note: downhole intersections approximate true width

Results to date demonstrate the potential for further resource growth within the Edna May gold system at depth and along strike. Drilling of the Stage Three program is now complete with an update of the Underground Mineral Resource expected in the March quarter 2012.

Mine Lease Exploration

A diamond drilling program consisting of nine holes for 3,660m targeting down dip extensions to high grade gold mineralisation at Greenfinch is planned to be undertaken in the next quarter. This will be followed by a resource definition drilling program consisting of 28 RC holes for 5,800m aiming to upgrade the Inferred Mineral Resource at Greenfinch.

Regional Exploration

Drill programs at Perrins, Townrow NW, Colossus, Rutherford’s Reward and Hill’s End are being prepared with the objective of identifying supplementary oxide ore feed for the Edna May process plant. The first drill program consisting of 29 RC drillholes for 2,900m at Perrins is due to commence in the coming quarter.

Mt Carlton, Queensland

Mine Lease Exploration

Three diamond holes for 774m were completed to test IP chargeability targets north-west of A39 and V2 deposits. Results show a prospective geochemical signature similar to that of the adjacent A39 deposit and additional drilling has been proposed for 2012. Better intersections are presented in Table 1.

Exploration programs in 2012 will test targets adjacent to V2 and A39 deposits, extensions to V2 East, a porphyry copper target at Capsize and high-grade, low-sulphidation mineralisation at Ortiz. The Boundary and Glenking prospects will also be advanced with further drilling. Drill targets will also be generated over favourable structural settings along the Amoola and Millaroo fault zones.

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Regional Exploration

At the Jasper Ridge and Silver Ridge prospects, drilling to test quartz veined and brecciated rhyodacites, similar to the host rock at the nearby V2 deposit, continued to return encouraging near-surface results. A further 22 RC holes for 3,873m were completed during the quarter with drilling to date outlining an extensive area of low level anomalous gold and silver mineralisation related to near surface altered rhyodacite.

At the Glenking prospect, 15 RC holes for 2,202m were completed to test outcropping low sulphidation epithermal quartz veins and broad gold and silver soil geochemistry zones within the Millaroo Fault Zone. All holes intersected multiple narrow quartz veins and quartz vein stockwork, with generally low grade gold results returned. A broad gold and silver soil geochemical anomaly remains to be drill tested to the north-east of the prospect.

At the Boundary prospect, mapping and rock chip sampling was successfully completed and five follow-up RC holes for 719m were drilled. Narrow quartz veins up to 4m were intersected with anomalous results returned with further assays pending. The sixth hole to complete the program will be drilled next quarter.

Mt Rawdon, Queensland

Resource Definition and Extension

Resource definition and extension drilling programs comprising seven drillholes for 2,308m were undertaken during the quarter to upgrade Inferred Mineral Resources and to test down-dip extensions to mineralisation at Mt Rawdon. Results will be incorporated in an update of the Mineral Resource and Ore Reserves to be undertaken in the March quarter 2012. Significant results include:

• MRRC203815-3: 35.38m[1] grading 1.19g/t Au, 3.21g/t Ag from 48.0m

• MRRC203815-4: 37.14m[1] grading 1.05g/t Au, 1.89g/t Ag from 48.0m

• MRRC203815-4: 17.14m[1] grading 1.89g/t Au, 3.48g/t Ag from 226.0m

• MRRC203815-5: 12.86m[1] grading 2.09g/t Au, 5.04g/t Ag from 8.0m

• MRRC203815-5: 89.29m[1] grading 0.98g/t Au, 2.18g/t Ag from 30.0m

• Estimated true width

Mine Lease Exploration

Results were received for RC drilling which tested aeromagnetic anomalies to the north-west and west of the Mt Rawdon mine. No significant assay results were returned for this drilling.

Regional Exploration

Drilling at Mt Shamrock to test the down-plunge potential of the Kent's Knob intrusive breccia zone was completed with assay results pending.

A drill proposal to test the Aranbanga Volcanic Stratigraphy immediately south of the Mt Rawdon Mine site has been completed and consists of five RC holes for 1,500m. Drilling is anticipated to commence in the June quarter 2012.

Pajingo, Queensland

Regional Exploration

Regional exploration during the quarter focused on drilling at the Moonlight prospect and along the Starlight corridor. In total 16 holes (RC and diamond) for 2,729.3m were completed and best drill assay results are provided in Table 1.

At the Moonlight prospect, drilling targeted a northwest trending zone of mineralised epithermal quartz veining and brecciation approximately 1.5km south of mine infrastructure. Mineralisation occurs as a vein

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stockwork and breccias that emanate from a steep northeast dipping feeder vein system comprising several narrow (less than 1m wide) epithermal quartz veins. Mineralisation has been intersected over a strike length of approximately 190m where it remains open to the northwest, southeast and down-dip (Figure 2).

Best results returned during the quarter are listed below:

• JMRD3681: 3m grading 6.62g/t Au from 391m 2m grading 8.47g/t Au from 488m

• JMRD3681A: 1.8m grading 7.13g/t Au from 487m

• JMRD3681B: 6.55m grading 3.52g/t Au from 411.45m

• JMRD3702: 1m grading 10.60g/t Au from 387m 1m grading 10.20g/t Au from 435m

2m grading 6.89g/t Au from 475m

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Figure 2: Schematic longsection of Moonlight prospect

At Starlight Corridor, eight holes have been completed following up high grade intercepts at Mt Starlight and a geophysical signature at Starlight B. Best results returned during the quarter included:

• JMRD3699: 6.0m grading 2.75g/t Au from 306m including 1.25m grading 7.54g/t Au

• JMRD3701: 7.95m grading 1.75g/t Au from 291.35m

The Starlight corridor is a 2.5km long, curvi-linear zone of quartz veining and brecciation oriented essentially east-west that intersects the northwest trending Vera-Nancy line of lode. It manifests as a coincident magnetic low and resistivity high extending for approximately 2.5km. Historic drilling has intermittently tested the zone to a depth of about 400m below the surface with localised high grade intercepts a feature of several

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of the earlier drill-holes, particularly in the Mt Starlight area. Recent drilling has targeted historic higher grade intercepts; focusing on areas where previous drilling did not extend deeper than 100m below surface.

An IP geophysical survey completed during the quarter at Starlight identified a large geophysical target contiguous with recent drill results of which a large portion remains to be drill tested. A program of 11 drill holes for 3,690m has been designed to target this prospective area next quarter.

Resource Development

A drilling program comprising 18 holes for 3,818m was undertaken at Sonia Eastern Extension targeting the Bunty structure. This program has led to a reinterpretation of the Bunty structure into two converging vein systems (Sonia East Extension and Olivia) with an easterly strike orientation. These veins have potential to add to existing Mineral Resources with ongoing drilling (Figure 3). Best results returned during the quarter from Sonia East Extension included:

• 0767_09_BN: 3.3m grading 13.06 g/t Au

• 0767_10_BN: 4.6m grading 44.90 g/t Au  0767_12_BN: 10.13m grading 5.14 g/t Au  0767_34_BN: 2.2m grading 21.21 g/t Au

• 0767_35_BN: 3.61m grading 37.18 g/t Au

Best results returned during the quarter from Olivia included:

• 0767_23_BN: 1.51m grading 10.08g/t Au

• 0767_24_BN: 1.87m grading 9.95g/t Au

Note: intersections are not true width with some being acute to the interpreted orebody

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Figure 3: Schematic longitudinal section of Sonia East Extension

CORPORATE

Completion of Merger and Asset Acquisition Transactions

Following shareholder meetings on 14 October 2011, Catalpa Resources Limited (“ Catalpa ”) and Conquest Mining Limited (“ Conquest ”) announced that shareholders of both companies had approved the creation of a growth focused, asset diversified Australian gold company, Evolution Mining, through a merger of equals between Conquest and Catalpa (“ Merger ”) and the concurrent purchase of Newcrest Mining Limited’s (“ Newcrest ”) interests in the Cracow and Mt Rawdon gold mines in Queensland (“ Asset Purchase ”) (collectively, “ the Transaction ”).

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Conquest shareholders overwhelmingly supported the Transaction, with 99% of votes cast at the Conquest scheme meeting being in favour of the Merger.

Catalpa shareholders also overwhelmingly supported the Transaction, with 99% of votes cast at the Catalpa extraordinary general meeting being in favour of the issue of new shares to Newcrest as consideration for the Asset Purchase.

The transaction was implemented on 2 November 2011. Effective from that date the Company name was changed to “Evolution Mining Limited” (from Catalpa Resources Limited) and its shares now trade under ASX code “EVN”. Holding statements for the shares issued by the Company in connection with the Transaction were despatched to shareholders on 2 November 2011.

Following successful completion of the Transaction a number of new Directors were appointed. Jake Klein was appointed as Executive Chairman and James Askew and Paul Marks (who were members of the Conquest Board) and Lawrie Conway and Peter Smith (who are nominees of Newcrest) were also appointed to the Board.

Entitlement Offer

On 9 November 2011 the Company launched an underwritten 3 for 17 accelerated, renounceable entitlement offer at an offer price of A$1.45 per new share (“ Entitlement Offer ”) to raise approximately A$152.5M.

The institutional investor component of the Entitlement Offer was completed successfully and raised gross proceeds of approximately A$107.1M. Pre-existing institutional shareholders showed strong support for the Entitlement Offer, taking up approximately 80% of their entitlements (excluding Newcrest’s entitlements under the Offer). Renounced entitlements were sold via a bookbuild, which achieved a clearing price of A$1.69 per new share. The premium of $0.24 per new share was returned to renouncing shareholders (less any applicable deductions).

The retail investor component of the Entitlement Offer was also completed successfully, raising gross proceeds of approximately A$45.3M. Renounced entitlements were sold via a bookbuild, which achieved a clearing price of A$1.70 per new share. The premium of A$0.25 per new share was returned to renouncing shareholders (less any applicable deductions).

The funds raised under the Entitlement Offer will be used to strengthen the Company’s balance sheet and increase its financial flexibility. The funds will also enable the Company to progress development plans and to pursue additional growth opportunities.

At the request of the Company, its largest shareholder, Newcrest Holdings (Investments) Pty Ltd (a whollyowned subsidiary of Newcrest), did not participate in the Entitlement Offer, resulting in its interest in the Company being diluted to 32.96%.

Finance

Revenue

Attributable gold sales were A$104.9M during the quarter from the sale of 64,302oz of gold at an average price of A$1,632/oz. This comprised 49,990oz of gold sold into the spot market at an average spot price of A$1,650/oz and 14,312oz delivered into the Edna May gold hedge book at an average price of A$1,566/oz.

Cash in bank increased by A$142.9M to A$167.5M at 31 December 2011 (A$24.7M at 30 Sept 2011). In addition, at year end, the Company held gold and silver yet to be sold of approximately A$19.8M.

Major cash movements during the quarter related to A$148.8M net inflow from the Entitlement Offer and net outflows of capital and exploration expenditure of A$38.7M (including A$18M on the Mt Carlton project development).

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At year end the Company held A$38.5M of debt relating to the Edna May Project Finance Facility and A$50M in Performance Bond Facilities relating to various site environmental performance obligations.

Hedge book

The Edna May hedge book at 31 December 2011 totaled 255,333oz of gold at an average deliverable price of A$1,573/oz. The marked to market value at year end was negative A$23.5M.

Funding

Negotiations with Macquarie Bank Limited (“Macquarie”) for A$100M of debt funding for the Mt Carlton project were terminated following completion of the Transaction and Entitlement Offer. The debt funding was not accessed and the bridge finance facility was cancelled.

The Company is currently assessing a range of options to take advantage of the Company’s lower risk profile to reduce its borrowing costs.

Conference Call

Executive Chairman Jake Klein will be hosting a teleconference for investors and media to discuss the Quarterly results on Wednesday, January 25, at 11:00am (Sydney, Australia time). Dial-in numbers are as follows:

• Australia: 1800 153 721

• New Zealand: 0800 442 709  United States: 1866 307 0659  Canada: 1866 307 0658  United Kingdom: 0808 238 9067  Switzerland: 0800 000 601

• International Toll Number: +612 8212 8333

Participant PIN Code: 256938#

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Table 1: Exploration Drilling and Assay Data

		Northing MGA (m)	Easting MGA (m)	Total Depth (m)
	Hole Type				Dip/Azi MGA	From (m)	Interval (m)	ETT1 (m)	Au (g/t)	Ag (g/t)	Cu (%)
Hole
Cracow
KRC060	RC	7205709	225452	378.00	-55/291	372.00	2.00	-	4.88	-	-
KRC094	RC	7192840	229780	200.00	-50/090	128.00	8.00	-	1.21	-	-
KDD255	DD	7199175	225536	942.80	-71/069	703.80	2.00	-	0.71	-	-
CBK317R	DD	7201158	224422	828.80	-66/244	563.30	7.70	2.03	7.59	-	-
CBK317R	DD	7201158	224422	828.80	-66/244	631.00	38.50	11.02	6.76	-	-
CBK317R	DD	7201158	224422	828.80	-66/244	665.00	5.00	1.74	5.47	-	-
KKU176	DD	7200436	223974	129.00	-14/321	96.00	14.50	11.63	10.25	-	-
KKU180	DD	7200443	223983	188.30	-20/326	94.80	26.50	13.70	14.22	-	-
KKU182	DD	7200462	223993	195.90	-18/341	106.20	24.80	12.05	12.74	-	-
KKU192	DD	7200047	224017	132.70	5/254	103.00	4.30	-	13.40	-	-
KKU194	DD	7200047	224016	127.40	6/268	91.00	8.50	-	15.52	-	-
KNU084	DD	7200685	224943	113.90	43/272	69.90	6.35	2.53	8.83	-	-
Edna May
EMD053	DD	6537400	661546	525.00	-53/140	421.00	3.15	-	18.13	-	-
						456.70	1.40	-	34.57	-	-
EMD055	DD	6537401	661545	531.00	-57/142	301.25	0.50	-	46.00	-	-
						309.65	1.20	-	12.05	-	-
						389.05	1.55	-	19.81	-	-
						457.60	1.70	-	29.45	-	-
EMD058A	DD	6537399	661548	574.00	-56/136	400.30	2.30	-	43.78	-	-
EMD057W	DD	6537400	661549	552.00	-60/137	509.50	1.00	-	11.00	-	-
EMD062	DD	6537403	661547	574.00	-53/133	375.70	4.65	-	56.19	-	-
EMD056W	DD	6537403	661546	551.00	-66/144	504.06	2.64	-	8.01	-	-
						404.77	1.95	-	12.49	-	-
Mt Carlton
HC11RC1012	RC	7757020	556060	200.00	-60/172	13.00	7.00	-	0.50	20.70	0.06
						65.00	1.00	-	0.39	137.00	0.15
HC11RC1013	RC	7757020	556010	200.00	-60/172	32.00	4.00	-	0.15	22.20	-
HC11RC1015	RC	7756935	555703	158.00	-60/172	44.00	8.00	-	0.05	136.10	-
HC11RCD1018	RC/DD	7758200	558700	237.00	-55/172	112.00	7.00	-	-	85.10	0.18

Note: ETT[1] denotes Estimated True Thickness. All intervals are downhole unless an estimated true thickness is tabled.

14

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Table 1: Exploration Drilling and Assay Data (continued)

			Northing MGA (m)	Easting MGA (m)	Total Depth (m)
	Hole Type					Dip/Azi MGA		From (m)		Interval (m)	ETT1 (m)	Au (g/t)	Ag (g/t)	Cu (%)
Hole
Mt Rawdon
MRRC203875-3	RC		7203877	375255	94.00	-78 / 270	48.00			46.00	35.38	1.19	3.21	-
MRRC203875-4	RC		7203877	375252	250.00	-61 / 270	87.00			52.00	37.14	1.05	1.89	-
							226.00			24.00	17.14	1.86	3.48	-
MRRC203875-5	RC		7203869	375262	270.00	-75 / 270	8.00			18.00	12.86	2.09	5.04	-
							30.00			125.00	89.29	0.98	2.18	-
Pajingo
JMRD3681	DD		7724884	445681	533.80	-70/227	391.00			3.00	-	6.62	-	-
							488.00			2.00	-	8.47	-	-
						and	495.50			2.00	-	6.79	-	-
JMRD3681A	DD		7724884	445681	575.90	-70/227	487.00			1.80	-	7.13	-	-
							509.00			0.20	-	20.30	-	-
							565.00			1.00	-	7.54	-	-
JMRD3681B	DD		7724884	445681	512.70	-70/227	411.45			6.55	-	3.52	-	-
JMRD3702	DD		7724866	445749	564.00	-66/225	387.00			1.00	-	10.60	-	-
							435.00			1.00	-	10.20	-	-
						including	475.00			2.00	-	6.89	-	-
JMRD3699	DD		7726843	445666	451.00	-58/196	306.00			6.00	-	2.75	-	-
							308.75			1.25	-	7.54	-	-
JMRD3701	DD		7726991	446725	340.00	-58/156	291.35			7.95	-	1.75	-	-
0767_09_BN	DD		7726654	445148	240.0	30/129	129.53			3.30	-	13.06	-	-
0767_10_BN	DD		7726654	445148	195.0	14/130	129.57			4.61	-	44.90	-	-
0767_12_BN	DD		7726655	445149	267.0	-21/130	190.65			10.13	-	5.14	-	-
0767_34_BN	DD		7726654	445148	216.0	24/115	83.25			2.20	-	21.21	-	-
0767_35_BN	DD		7726654	445148	168.1	11/116	86.22			3.61	-	37.18	-	-
0767_23_BN	DD		7726652	445146	143.9	-5/171	69.37			1.51	-	10.08	-	-
0767_24_BN	DD		7726652	445146	153.0	-24/171	79.13			1.87	-	9.95	-	-
0767_26_BN	DD		7726653	445144	173.7	30/192	88.08			2.15	-	5.55	-	-

Note: ETT[1] denotes Estimated True Thickness. All intervals are downhole unless an estimated true thickness is tabled.

15

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Competent Person Statement

The information in this report that relates to exploration results, Mineral Resources or Ore Reserves listed in the table below is based on work compiled by the person whose name appears in the same row, who is employed on a full-time basis by the employer named in that row and is a member of the institute named in that row. Each person named in the table below has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he or she has undertaken to qualify as a Competent Person. Each person named in the table consents to the inclusion in this report of the matters based on his or her information in the form and context in which they appear.

	Name of **Competent Person **
Result/Resource/Reserve		Employer	Institute
			Australian Institute of Mining and Metallurgy
Cracow exploration results	Adrian Pelliccia	Evolution Mining Limited
			Australian Institute of Mining and Metallurgy
Edna May exploration results	Luke Cox	Evolution Mining Limited
Mt Carlton exploration results	David Hewitt	Evolution Mining Limited	Australian Institute of Geoscientists
			Australian Institute of Mining and Metallurgy
Mt Rawdon exploration results	Tim Murphy	Evolution Mining Limited
Pajingo exploration and resource development results
	Brentan Grant	Evolution Mining Limited	Australian Institute of Geoscientists

16

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CORPORATE INFORMATION

ABN 74 084 669 036

Board of Directors

Executive Chairman Managing Director Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director

Jake Klein Bruce McFadzean Jim Askew Laurie Conway Graham Freestone Paul Marks John Rowe Peter Smith

Company Secretary

Evan Elstein

Registered Office

Level 7, 282 Oxford Street Bondi Junction NSW 2077 PO Box 206 Bondi Junction NSW 1355 Tel: (612) 8383 2100 Fax: (612) 8383 2101

Share Register

Link Market Services Limited Locked Bag A14 Sydney South NSW 1235

Tel: 1300 554 474 (within Australia) Tel: (612) 8280 7111 Fax: (612) 9287 0303 Email: registrars@linkmarketservices.com.au

Investor Enquiries

Donna Kelly and Liesl Kemp Investor Relations Evolution Mining Limited Tel: (618) 6216 9700

Media Enquiries

Michael Vaughan FTI - Media Relations Tel: (612) 8298 6100

Internet Address

www.evolutionmining.com.au

Stock Exchange Listing

Evolution Mining Limited shares are listed on the Australian Securities Exchange under code EVN

Issued Share Capital

At 31 December 2011 issued share capital was 700,995,107 ordinary shares

17

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

	EVOLUTION MINING LIMITED	EVOLUTION MINING LIMITED	EVOLUTION MINING LIMITED	EVOLUTION MINING LIMITED
	ABN 74 084 669 036 Consolidated statement of cash flows		Quarter ended (“current quarter”)
			31 DECEMBER 2011
Cash flows related to operating activities 1.1 Receipts from gold sales 1.2 Payments for (a) production (b) administration (c) exploration 1.3 Interest and other items of a similar nature received 1.4 Interest and other costs of finance paid 1.5 Income taxes paid 1.6 Other (provide details if material) Net Operating Cash Flows		Current quarter $’000		Year to date (6 months) $’000
		106,677 (79,927) (12,645) (3,537) 730 (773) - -		149,981 (108,397) (16,643) (3,627) 1,042 (2,030) - -
		10,525		20,326
Cash flows related to investing activities 1.7 Payment for purchases of: (a) project development 1.8 Proceeds from sale of: (a) prospects 1.9 Loans to other entities 1.10 Loans repaid by other entities 1.11 Other 1.12 Other Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)		(18,226) - - - - -		(27,559) - - - - -
		(18,226)		(27,559)
		(7,701)		(7,233)

			Current quarter $’000	Year to date (3 months) $’000
1.13 Total operating and investing cash flows (brought forward)			(7,701)	(7,233)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from borrowings 1.16 Repayment of loan 1.17 Repayment of other borrowings 1.18 Dividends paid 1.19 Other Net financing cash flows			153,446 - (3,000) - - -	153,670 - (9,022) - - -
			150,446	144,648
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			142,745 24,721 -	137,415 30,051 -
			167,466	167,466
Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related e				ntities
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 $'000
				413
				NIL
1.25 Explanation necessaryfor an understandingof the transactions All transactions involving Directors and associates were on normal commercial terms. 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 reportingentityhas an interest NIL		Explanation necessaryfor an understandingof the transactions
		All transactions involving Directors and associates were on normal commercial terms.
	NIL
	Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas 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	Amount used
$’000	$’000
38,500	38,500
NIL	NIL

Estimated cash outflows for next quarter (1)

Estimated cash outflows for next quarter(1)
4.1 Exploration and evaluation(2) 4.2 Development 4.3 Production 4.4 Administration(3)	$’000
	[See 4.2]
	69,715
	89,570
	33,835
Total	193,120

• (1) Before gold and silver revenue cash flows

(2) Includes exploration and Mt Carlton capital expenditures

(3) Includes estimate of stamp duty payable on transactions during the December quarter

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 $’000	Previous quarter $’000
5.1 Cash on hand and at bank 5.2 Deposits at call 5.3 Bank overdraft 5.4 Other (provide details) – short term guarantees	124,781	24,721
	42,501	-
	-	-
	184	-
Total: cash at end of quarter(item 1.22)	167,466	24,721

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
-	-	-	-
See attached appendix

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	NIL	NIL	NIL	NIL
	NIL NIL	NIL NIL	NIL NIL	NIL NIL
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs	700,995,107	700,995,107		Fully paid
	105,144,107 822,773 5,245,601 231,082,631 180,401,006 NIL	105,144,047 822,773 5,245,601 231,082,631 180,401,006 NIL		Fully paid Fully paid Fully paid Fully paid Fully paid NIL
7.5 +Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted	NIL	NIL	NIL	NIL
	NIL NIL	NIL NIL	NIL NIL	NIL NIL

	Total number	Number quoted	Exercise price per security (see note 3)	Expiry date
7.7 Options (description and conversion factor)	329,548 329,548 329,547 272,726 56,819 113,637 113,637 113,637 113,637 6,060,606 679,000 505,291 6,290 15,172 454,645 634,672 346,865 1,560,450 582,141 221,645 350,264 600,000 93,572 1,164 2,810 84,194 117,532 64,234 400,084 107,804 41,046 64,864 1,215,000 600,000 315,000 735,000 555,000 1,650,000	NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL	$0.829 $1.049 $1.269 $1.489 $0.609 $0.609 $0.829 $1.049 $1.269 $0.830 $1.690 $1.822 $1.782 $1.860 $1.936 $1.879 $2.072 $1.802 $1.472 $2.072 $2.412 $3.062 $1.822 $1.782 $1.860 $1.936 $1.879 $2.072 $1.802 $1.472 $2.072 $2.450 $1.270 $1.840 $1.400 $2.130 $1.880 $2.000	23/12/2013 23/12/2013 23/12/2013 23/12/2013 23/12/2013 11/03/2014 11/03/2014 11/03/2014 11/03/2014 11/03/2014 30/06/2015 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 18/11/2016 18/11/2016 26/02/2013 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 18/11/2016 18/11/2016 1/06/2015 25/11/2016 6/10/2015 25/11/2015 1/04/2016 19/10/2012

7.8 Issued during quarter* 7.9 Exercised during quarter 7.10 Expired during quarter	505,291 6,290 15,172 454,645 634,672 346,865 1,560,450 582,141 221,645 350,264 600,000 93,572 1,164 2,810 84,194 117,532 64,234 400,084 107,804 41,046 64,864 1,215,000 600,000 315,000 735,000 555,000 1,650,000	NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL	$1.822 $1.782 $1.860 $1.936 $1.879 $2.072 $1.802 $1.472 $2.072 $2.412 $3.062 $1.822 $1.782 $1.860 $1.936 $1.879 $2.072 $1.802 $1.472 $2.072 $2.450 $1.270 $1.840 $1.400 $2.130 $1.880 $2.000	25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 25/11/2016 18/11/2016 18/11/2016 26/02/2013 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 25/11/2015 18/11/2016 18/11/2016 1/06/2015 25/11/2016 6/10/2015 25/11/2015 1/04/2016 19/10/2012
	45,457 45,455 68,184 68,186 5,018,319	NIL NIL NIL NIL 5,018,319	$1.090 $1.087 $1.307 $1.527 $1.100	23/12/2013 23/12/2013 23/12/2013 23/12/2013 30/10/2011
	159,223	159,223	$1.100	30/10/2011
7.11 Debentures (totals only)	NIL	NIL
7.12 Unsecured notes(totals only)	NIL	NIL
7.13 Performance rights*	159,836 240,984 159,836 240,984 106,557 160,656 106,557 160,656 575,500 575,500	NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL	NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL	30/6/2013 30/6/2013 30/6/2014 30/6/2014 30/6/2013 30/6/2013 30/6/2014 30/6/2014 30/6/2012 30/6/2013

7.14 Issued during quarter 7.15 Exercised during quarter 7.16 Expired during quarter	159,836 240,984 159,836 240,984 106,557 160,656 106,557 160,656	NIL NIL NIL NIL NIL NIL NIL NIL	NIL NIL NIL NIL NIL NIL NIL NIL	30/6/2013 30/6/2013 30/6/2014 30/6/2014 30/6/2013 30/6/2013 30/6/2014 30/6/2014
	NIL NIL	NIL NIL	NIL NIL	NIL NIL
	NIL NIL	NIL NIL	NIL NIL	NIL NIL

• Issued under the employee options and performance rights plan approved by shareholders at the AGM on 23 November 2010.

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.

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Sign here: Date: 25 January 2012

Print name: Evan Elstein – 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 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.

== == == == ==

Appendix A – Tenements Acquired

Appendix A – Tenements Acquired	Appendix A – Tenements Acquired	Appendix A – Tenements Acquired	Appendix A – Tenements Acquired
Tenement reference	Nature of interest (note (2))	Interest at beginning of quarter	Interest at end of quarter
ML 3219 ML 3221 ML 3223 ML 3224 ML 3227 ML 3228 ML 3229 ML 3230 ML 3231 ML 3232 ML 3234 ML 3243 ML 80024 ML 80088 ML 80089 ML 80114 ML 80120 EPM 10566 EPM 17302 EPM 17455 EPM 18173 EPM 9563 ML 1192 ML 1203 ML 1204 ML 1206 ML 1210 ML 1231 ML 1259 ML 50119 EPM 10164 EPM 11147 EPM 11971 EPM 12527 EPM 12829 EPM 13867 EPM 14155 EPM 14783 EPM 15597 EPM 15598 EPM 15623 EPM 15630 EPM 15805 EPM 16480 EPM 17242 EPM 17243	Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired	NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL	100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

EPM 18568 EPM 4459 EPM 8693 EPM 11152 EPM 12012 EPM 14187 EPM 14585 EPM 17792 EPM 17793 EPM 18405 EPM 18407 EPM 18444 EPM 18445 MLA 20446 ML 1575 ML 10215 ML 10246 ML 70316	Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired Acquired	NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL NIL	100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%