FireFly Metals Ltd. — Capital/Financing Update 2012

Dec 20, 2012

Exploration Office Ware h ouse I, 5 Bu t ler Blvd Bu r bridgeBusi n essPark Adel a ide Airport SA 5950 Postal Address PO Box 247 E xport Park SA 5950

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Tel: +61 8 8 3 75 3900 Fax: +61 8 8 3 75 3999 www. m onaxminin g .com.au

ABN: 96 110 336 733

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For Imme d iate Relea s e Friday, 21 December , 2012

ASX RELEASE

Further flake graphite discovered at Monax’s Waddikee Graphite Project in South Australia

HIGHLIGHTS

• Further flake graphite found at the Wilclo South prospect – part of Monax’s Waddikee Graphite Project - extending strike length of graphite to ~2.5km.

• Visible flake graphite found at Francis prospect, also part of the Waddikee Project, potentially defining new zone of coarse flake graphite.

• 2012 Punt Hill drilling program in northern SA completed.

• Further tenements added to the Monax Alliance.

Monax Mi n ing Limite d (ASX:M O X) (“Mona x ” or “the Company”) i s please to provide a n update o n current ex p loration a c ross its pr o ject portfol i o (Figure 1).

Waddikee Graphite Project (100% Monax)

A progra m of mapping and sampling has commenced to provide further ge o logical inf o rmation fo r planned d r illing to co m mence in February 2 013. Wor k at the Wilclo South p rospect h a s extende d the surfac e exposur e of visible flake grap h ite up to ~ 2.5km in strike lengt h . Areas m apped an d sampled are shown on Figure 2.

The Wilcl o South pr o spect con t ains a prominent air b orne elect r omagnetic (AEM) an o maly (se e Figure 2) a nd previo u s samplin g and drilli n g was con f ined to th e northern p art of the a rea, withi n an uncropped paddo c k. With h arvesting c ompleted, access to t he southe r n area wa s approve d with sever a l outcrops of coarse, visible flak e graphite s ampled (Figure 3). G raphitic flo a t collecte d from the area was al s o sampled and appe a rs to indicate two pot e ntial limbs o f a large r e gional fol d structure (Figure 3).

Fourteen s amples w e re collecte d at the Wil c lo South prospect (see Plates 1 & 2).

The Fran c is prospec t located a p proximately 5.3km w e st south- w est of the Wilclo Sou t h prospec t (see Figu r e 2) was t a rgeted du e to a very strong AE M anomaly. Figure 4 shows the location o f four graphite float sa m ples colle c ted from t h e area wit h in a zone of anomal o us AEM a n d historica l ground el e ctromagne t ic (EM) da t a. The flo a t graphite s amples all contained visible flak e graphite.

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Monax is encourage d about th e discover y of float g r aphite over this stro n g EM ano m aly at th e Francis pr o spect.

The Com p any is pla n ning several lines of d etailed gr o und EM t o assist wit h locating d rill holes t o target the highly con d uctive fea t ure, which possibly r e presents a new zone of coarse v isible flak e graphite. Historical E M data at Francis c o ntains the highest E M values within the a r ea and th e anomaly i s up to 3.5km in length (Figure 4).

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Plate 1. Sample of visible coarse Plate 2. Sample of visible coarse graphite graphite float from Wilclo South from an outcrop at Wilclo South

Monax will commen c e a groun d EM surv e y in mid-J a nuary 2013 followed by a detai l ed revers e circulation (RC) drilli n g program at the Wil c lo South prospect wit h the aim o f defining a Resourc e by mid-20 1 3. RC dril l ing at Francis and La c roma is al s o planned f or early 2013.

Mapping d owngrade d the Balu m bah Siding area (Fig u re 2). His t orical sam p ling report e d graphit e up to 11 % total gra p hitic carbon (TGC), b ut inspection of this area showed the graphite to b e narrow an d mainly a m orphous.

Monax is c urrently a w aiting the r esults fro m beneficiat i on work u n dertaken on samples from Wilcl o South with final results expected in early 2013.

Punt Hill Copper-Gold Project (Monax 100%; Antofagasta earning 51%)

Monax co m pleted a s even hole d rilling pro g ram totalli n g 6875m i n mid-Dec e mber 201 2 . Drill hol e details an d locations a re shown in the Tabl e below.

The first d r ill hole of the campai g n was MMDD01. Thi s was a re- e ntry into a hole drille d by Mona x in 2007. T h e hole was originally terminated at ~911m within the B eda Volc a nics (part o f the cove r sequence), due to te c hnical diffi c ulties and g eological u nderstanding at that t i me.

The exten s ion of this drill hole i n tersected i n the drill h o le returne d 75m @ 0.2% Cu an d 1.5 g/t A g from 990 m . This incl u ded a 10 m zone reporting 0.72 % Cu, 0.1 8 g/t Au and 2.55 g/t A g (1034 – 1044m). Several narr o w zones o f anomalo u s copper w ere also re p orted incl u ding:  4m @ 0.17% C u (1099 – 1103m)  4m @ 0.56% C u (1164 – 1168m). (Note: Hole MMDD0 1 drilled ve r tical and d u e to the fl a t lying nat u re of the m etasedime n tary rocks , reported widths repre s ent interpr e ted true widths).

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Drill Hole No.	E asting	Northing	Azimuth	Dip	Tot al depth
MMDD01	743328	6503022		90o	12 48.4m
PHDD120 1	741802	6503642		90o	9 69.5m
PHDD120 2	739692	6507636		90o	10 77.5m
PHDD120 3	737499	6507582		90o	8 66.3m
PHDD120 4	741867	6505406	225 o	60o	1 306.8
PHDD120 5	737595	6505090		90o	790.3
PHDD120 6	724360	6527433	325 o	60o	641.2
PHDD120 7	735425	6508032	090 o	60o	885.6

Datu m MGA 94 Z o ne 53. Holes vertical un l ess specified above.

The remaining holes intersected either altered metas e diments o r altered to fresh Doni n gton Suit e granite wi t h some minor sulphi d es. No extensive z o nes of mi n eralisation were rep o rted in th e remaining drill holes.

Monax be l ieves the p roject rem a ins highly prospective for Olym p ic Dam style iron ox i de copper - gold mine r alisation a n d it will no w turn its attention to o ther area s to help define the di m ensions o f the syste m and the l o cation of o t her possib l e high gra d e minerali s ation. Th e Technical Committe e is schedul e d to meet in Februar y 2013, wh e re it will review the recently completed drilli n g progra m and discu s s the expl o ration program movin g forward.

Monax:Antofagasta Strategic Alliance

In Octobe r 2011, Mo n ax announced the formation of a Strategic A lliance wit h Antofaga s ta Mineral s Adelaide ( “Antofaga s ta”), a wh o lly owned subsidiar y of ‘Antof a gasta plc’ , a major i nternation a l copper mi n ing company, for proj e ct generation in Sout h Australia. Monax no w has 15 t e nements c overing fi v e separat e areas, all located in South Aus t ralia, whic h are potent i ally subjec t to the Alli a nce.

The terms of the agr e ement require that A n tofagasta s pend thro u gh Monax US$1 million over tw o years to f a cilitate are a prospecti v ity identifi c ation and a nalysis, b a sic exploration, project generatio n and targe t selection. Any initi a l propertie s that are identified a s a projec t of interest become a ‘Designat e d Project’ (DP). Onc e a DP ha s been for m ed, Antof a gasta will have acq u ired a 51 % interest and Monax a 49% interest in the pr o ject.

Antofagas t a will the n have the option to earn an a dditional 19% of an y DP (cum u lative 70 % interest) b y spending a further U S$4 millio n on explor a tion within three yea r s and sub s equently b e required t o make an a dditional c a sh payme n t (success fee) to Mo n ax for US $ 3 million.

The 15 Alliance ten e ments are outlined below (see Figure 1 and Table b elow for l o cation an d tenement d etails):

Projec t	Tene ment	No .	S tatus	A rea
Marla	Christ mas Well	ELA 2012/ 00261	Ap plication	3 20 km2
	Moun t Alice	ELA 2012/ 00278	Ap plication	8 11 km2
Algebu ckina	Algeb uckina	EL 50 93	G ranted	39 9 km2
	Dougl as Creek	EL 50 94	G ranted	9 35 km2
	Old Um bum	EL 49 90	G ranted	54 0 km2

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WGC	Nullar bor	ELA 2012/ 00063	Ap plication	9 63 km2
	North of Yalata	EL 50 77	G ranted	94 1 km2
	West of Yalata	EL 49 92	G ranted	9 57 km2
	Yalata	EL 49 93	G ranted	9 51 km2
	EastY alata	ELA 2012 /00276	Ap plication	90 4 km2
Olymp ic IOCG	Arthu r Hill	ELA 2012/ 00250	Ap plication	34 6 km2
	Hunts Bore	ELA 2012/ 00318	Ap plication	2 71 km2
	Vangu ard	ELA 2012/ 00326	Ap plication	4 24 km2
Kanga roo Island	Parnd ana	ELA 2012/ 00067	Ap plication	8 68 km2
	West of Parndana	ELA 2012/ 00068	Ap plication	2 26 km2

Algebucki n a Designa t ed project The Alge b uckina DP (“ADP”) c omprises three Allia n ce tenem e nts and t w o teneme n ts held b y Falcon Mi n erals Limi t ed (ASX:FCN) (“Falc o n”) – refe r ASX Ann o uncement 19 Dece m ber 2012 - and is loc a ted on the northern m argin of the Gawler C raton (Fig u re 1). The ADP is lo c ated withi n the Peak e and De n ison Inlier and expl o ration will commence upon a p proval by the Sout h Australian Governme n t of the re c ently sign e d Option t o Purchase Agreemen t with Falco n .

Once this approval h a s been gr a nted and t he Aborigi n al heritag e process h as been c o mpleted, a detailed g r avity surve y is planne d over four selected ta r gets.

All of these projects a re at an e arly stage of evaluati o n by the A lliance, a n d further r e porting o n these will b e made a s exploratio n activities p rogress.

Gary Ferri s Managing Director Monax Mi n ing Ph: (08) 8 3 75 3900 Email: inf o @monaxmining.com. a u

Duncan Gordon Investo r Relations Ph: 0404 006 444

The information in this report tha t relates to Explo r ation Results, Mi n eral Resources or Ore Reserves is based on infor m ation compiled b y Mr G M Ferris , who is a Memb e r of the Australa s ian Institute of M ining and Metall u rgy. Mr Ferris is employed full time by the Compa n y as Managing D irector and, has a minimum of five years relevant e x perience in the s tyle of mineralis a tion and type of deposit under co n sideration and qualifies as a Co m petent Person a s defined in the 2 0 04 edition of the “Australasian Co d e for Reporting o f Exploration Re s ults, Mineral Resources and Ore R eserves” Mr Fer r is consents to th e inclusion of the i nformation in this report in the for m and context in which it appears.

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Figure 1. Location of Monax South Australian projects.

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Figure 2. Waddikee Graphite Project. Location of mapping sites. Background 100-150m depth AEM data (red = zones of high conductivity).

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Figure 3. Wilclo South prospect. Location of graphite sites including graphite in outcrop and float. Background Google Earth image. Contours from 100-150m AEM survey data and numbers from historical WMC EM survey (large numbers denote point of high conductivity).

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Figure 4. Francis prospect. Location of float samples containing visible flake graphite. Location of graphite sites including graphite in outcrop and float. Background Google Earth image. Contours from 100-150m AEM survey data and numbers from historical WMC EM survey (large numbers denote point of high conductivity).

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