FireFly Metals Ltd. - Capital/Financing Update 2010

Exploration Office Warehouse I, 5 Butler Blvd Burbridge Business Park Adelaide Airport SA 5950 Postal Address PO Box 247 Export Park SA 5950

ABN: 96 110 336 733

Tel: +61 8 8375 3900 Fax: +61 8 8375 3999 www.monaxmining.com.au

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For Immediate Release Wednesday, 1 September, 2010

ASX RELEASE

Punt Hill Farm-In Agreement with Major Copper Miner

HIGHLIGHTS

Farm-in Agreement signed over Punt Hill copper-gold project with major Chilean copper mining company - Antofagasta PLC
Agreement provides significant investment in Monax’s flagship project and represents first venture within Australia for Antofagasta
Antofagasta can earn 51% of the project by expending US$4 million and an additional 19% by expending a further US$5 million

Monax is pleased to announce it has signed an option agreement over the highly prospective Punt Hill copper-gold project tenements (EL 3457 & ELA 44/10) with a major international copper mining company, Antofagasta PLC ("Antofagasta"), through its wholly-owned subsidiary Antofagasta Minerals S.A.

Antofagasta is a Chilean based copper mining company listed on the London Stock Exchange which owns and operates three copper mines in Chile. Antofagasta produced 442,500 tonnes of copper in 2009 and is forecasting an increase in production to 700,000 tonnes in 2011, ranking it as one of the top 10 copper producers in the world. Antofagasta is looking to grow its portfolio and currently has exploration and evaluation programs in North America, Latin America, Africa and Asia. The Punt Hill farm-in agreement represents Antofagasta’s first investment within Australia.

Under the Agreement, Antofagasta can earn a 51% interest in the Punt Hill project by expending US$4 million over 4 years. Once Antofagasta has obtained this 51% interest, Monax has the ability to remain at 49% by co-funding exploration or development costs, or can elect to have its interest diluted. Antofagasta can earn a further 19% equity in the project by expending a further US$5 million on exploration and development of the project tenements. If a development decision is made, Antofagasta will pay Monax a success fee of $US 10 million.

Commenting on the agreement, Monax’s Managing Director, Gary Ferris, said “Monax is extremely pleased with the involvement of a major international copper miner in the Company’s flagship Punt Hill project. Recognition by Antofagasta that Monax has delineated a significant mineralised system supports our belief that the Punt Hill project remains highly prospective. Drilling by Monax has reported the most significant copper mineralisation outside of the already defined deposits within the Iron Oxide Cu-Au Province, and recent detailed gravity surveys have defined two drill ready targets at Gopher and Otcheck. Investment by Antofagasta on exploration and development

of the project tenements will significantly advance the Punt Hill project, with the aim of discovering a world class Iron Oxide Cu-Au (IOCG) deposit”.

Background

The Punt Hill project is located within the highly prospective Iron Oxide Cu-Au Province on the eastern margin of the Gawler Craton (Figure 1). This province is host to the world class Olympic Dam and Prominent Hill mines, as well as the recently discovered Carrapateena and Hillside deposits (Figure 1). The Punt Hill tenement is adjacent to Carrapateena, which consists of a complex hematite breccia extending at depth from 470m. Monax has also recently added the Yeltacowie tenement (ELA 44/10) to the project area, located 12 km west of Carrapateena (Figure 2).

Monax has drilled 22 holes on EL 3457 for a total of 19,680m. Significant intersections include:

Hole GHDD6 – 159m @ 0.47% Cu, 0.12 g/t Au, 5.3 g/t Ag, 0.48% Zn & 0.12% Pb ( from 846m ) including
17m @ 1.1% Cu, 8.5 g/t Ag & 1.2% Zn ( from 853m )
Hole GHDD4 – 122m @ 0.47% Cu, 0.1 g/t Au, 6.6 g/t Ag & 0.38% Zn ( from 840m ) including
15m @ 0.96 Cu, 0.13 g/t Au, 10.5 g/t Ag & 0.52% Zn ( from 840m )
Hole GHDD1 – 126m @ 0.4% Cu (from 837m) including
14m @ 0.7% Cu ( from 846m ), and
14m @ 1.1% Cu, 0.25 g/t Au & 4.5 g/t Ag ( from 940m )
Hole WDDD1 – 70m @ 0.41% Cu ( from 683m ) including
28m @ 0.82% Cu & 10g/t Ag ( from 683m )
Hole WPDD1 – 60m @ 0.13% Cu & 0.03 g/t Au ( from 788m )

Exploration on the Punt Hill project tenements has comprised various geophysical methods including gravity, aeromagnetic and IP surveys which have successfully defined numerous targets worthy of drilling. Gravity surveying defined two prominent northwest trending gravity ridges and drilling undertaken by Monax has demonstrated that these ridges contain significant zones of IOCG style alteration and mineralisation.

Detailed examination of the drill holes demonstrates the presence of a major skarn alteration system with associated copper, gold, silver, zinc, lead and rare earth element (REE) mineralisation (Figure 3). Similar skarn systems are known to occur within and peripheral to the Olympic Dam deposit, increasing the potential for discovery of high-grade skarn mineralisation and/or a typical IOCG breccia system at Punt Hill. Previous drilling within the Groundhog area has demonstrated skarn mineralisation well in excess of 8km in length, a similar sized footprint to Olympic Dam. Monax maintains a firm view that this is a world class project which remains significantly under explored.

Recent detailed gravity by Monax has defined two further targets on EL 3457, the Gopher and Otcheck prospects. The Gopher prospect is located approximately 15km northwest of Groundhog, representing a discrete gravity target compared to the prominent gravity ridge seen within the Groundhog area. Modelling of the gravity data shows the source is located between 250 — 450m below the surface (Figure 4). The Gopher anomaly is approximately 1.5km in length and drilling at Flickertail to the north has shown the basement rocks are shallower within this part of the Punt Hill tenement EL 3457.

The Otcheck anomaly is located approximately 6km northwest of the Prairie Dog prospect. Hole PDDD2 reported 152m @ 0.32% zinc from 856m including a 1m intersection of 7.58% copper and 10 g/t silver at 880m.

Monax has significantly increased its position at Punt Hill with the addition of a new tenement located immediately northwest of the Punt Hill tenement. ELA 44/10 (Yeltacowie) covers 381 km[2] and is just 15 km to the west of Carrapateena (Figure 2). The tenement area contains only two drill holes which intersected basement rocks between 368m and 375m depth. Both holes intersected felsic volcanics which are interpreted to represent the Mesoproterozoic Gawler Range Volcanics, an important component of the mineralisation model for IOCG deposits in the region.

The regional gravity data covering both Punt Hill (EL 3457) and Yeltacowie (ELA 44/10 - Figure 2), shows prominent gravity features in the southern part of ELA 44/10, which have not been drill tested. The two drill holes within ELA 44/10 are not centred on these gravity anomalies.

Under the new farm-in agreement, an Exploration Subcommittee will be formed comprising two representatives each from Monax and Antofagasta. Monax will remain the Operators for the first two years. The forward exploration program has yet to be defined, but will initially include further detailed gravity on other parts of EL 3457 and ELA 44/10. Monax will update the Market once the exploration program has been finalised.

Gary Ferris Managing Director Monax Mining Limited

Gary Ferris Managing Director, Duncan Gordon Monax Mining Investor Relations Ph: (08) 8375 3900 Ph: 0404 006 444 Email: [email protected]

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr G M Ferris, who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Ferris is employed full time by the Company as Managing Director and, has a minimum of five years relevant experience in the style of mineralisation and type of deposit under consideration and qualifies 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 Ferris consents to the inclusion of the information in this report in the form and context in which it appears

About Antofagasta

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Antofagasta is a Chilean-based copper mining company listed on the London Stock Exchange. Currently, Antofagasta’s activities are primarily concentrated in Chile where it owns and operates three copper mines: Los Pelambres, El Tesoro and Michilla. Total production in 2009 included 442,500 tonnes of copper in cathode and concentrate and 7,800 tonnes of molybdenum in concentrate. As a result of the Los Pelambres expansion and Esperanza project the Group is expected to increase total copper production to over 700,000 tonnes per year by 2011. Antofagasta also has exploration and evaluation or feasibility programmes in North America, Latin America, Europe, Asia and Africa.

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Figure 1: Location of Monax’s Punt Hill project within the Iron Oxide Cu-Au Province.
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Figure 2: Punt Hill project EL 3457 and ELA 44/10 (Yeltacowie) on available gravity data.
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