FireFly Metals Ltd. — Interim / Quarterly Report 2013

Jan 30, 2013

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 31 January 2013

Monax Mining Limited Quarterly Report For the quarter ended 31 December 2012

HIGHLIGHTS

• Punt Hill Project –

• 2012 drilling program completed.

• 75m@ 0.2% Cu in hole MMDD01 reported.

• Approximately US$3.8 million invested on the project to date by major Chilean mining company, Antofagasta.

•

Monax | Antofagasta Strategic Alliance –

• Monax Alliance has signed an Option to Purchase agreement with Falcon Minerals for two tenements in the Peake and Denison area in northern South Australia.

• Two Falcon Mineral tenements have been incorporated into Algebuckina Designated Project with exploration to commence upon Ministerial approval of the Agreement.

• Review of a number of potential copper projects for the Alliance has continued.

•

Waddikee Project –

• Field mapping has extended surface graphite at Wilco South prospect up to 2.75 km in strike with up to three zones identified.

• Coarse flake graphite float was found at Francis prospect, increasing prospectivity of this target.

• Ground EM survey commenced mid-January 2013 with drilling planned to commence in mid-February 2013.

Quarterly report for the period ending 31 December 2012 ~ 1 ~

Corporate

In the three months to 31 December 2012, Monax (ASX:MOX) continued exploration of its Punt Hill copper-gold and Waddikee graphite projects located in northern South Australia and Eyre Peninsula regions respectively.

A major drilling program was completed at the Company’s Punt Hill Project in mid-December funded entirely by farmin partner Antofagasta Minerals Adelaide Pty Ltd, a wholly owned subsidiary of major copper producer, Antofagasta plc.

During the quarter, Monax Alliance Limited signed an Option to Purchase agreement with Perth based ASX listed Falcon Minerals Limited (ASX:FCN) for two granted tenements in the Peake and Denison area in northern South Australia. The two tenements have been incorporated into the first Designated Project under the Monax | Antofagasta Strategic Alliance.

Marmota Energy Limited (ASX:MEU) (“Marmota”) reported positive results from electromagnetic and gravity surveys at its Durkin Project in northern South Australia, with drilling planned for the first quarter in 2013. Monax remains Marmota’s major shareholder with 32.6 million shares (14.28% undiluted).

The current value of this holding is $1.95 million (based on share price $0.06).

As at 31 December 2012, Monax had a cash balance of $2.6 million. During the quarter $1.6 million was spent on exploration on Monax projects.

Exploration

South Australian projects

Monax has five South Australian projects (Figure 1).

1. Punt Hill – copper-gold (farm-in with Antofagasta).

2. Monax | Antofagasta Strategic Alliance.

3. Waddikee – graphite, manganese and iron.

4. Phar Lap – copper-gold.

5. Yorke Peninsula – copper-gold (includes Melton JV with Marmota Energy).

Quarterly report for the period ending 31 December 2012 ~ 2 ~

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Figure 1. Location of Monax’s projects.

Punt Hill Project – copper-gold (Monax 100%; Antofagasta earning 51%)

The Punt Hill Project is located within the highly prospective Olympic Iron Oxide Copper-Gold (IOCG) Province on the eastern margin of the Gawler Craton in northern South Australia. This province is host to the world class Olympic Dam and Prominent Hill mines, as well as the recently discovered Carrapateena and Hillside deposits.

The Punt Hill project is subject to a farm-in agreement with major Chilean mining company Antofagasta plc, through its wholly-owned subsidiary, Antofagasta Minerals Adelaide Pty Ltd (“Antofagasta”).

Quarterly report for the period ending 31 December 2012 ~ 3 ~

Monax completed a seven hole drilling program totalling 6875m in mid-December 2012. Drill hole details and locations are shown in Figure 2 and the Table below.

The first drill hole of the campaign was MMDD01. This was a re-entry into and extension of a hole drilled by Monax in 2007. The hole was originally terminated at ~911m within the Beda Volcanics (part of the cover sequence), due to technical difficulties and geological understanding at that time.

The extension of this drill hole intersected in the drill hole returned 75m @ 0.2% Cu and 1.5 g/t Ag from 990m. This included a 10m zone reporting 0.72% Cu, 0.18 g/t Au and 2.55 g/t Ag (1034 – 1044m). Several narrow zones of anomalous copper were also reported including:

• 4m @ 0.17% Cu (1099 – 1103m)

• 4m @ 0.56% Cu (1164 – 1168m).

(Note: Hole MMDD01 was drilled vertically and due to the flat-lying nature of the metasedimentary rocks, reported widths represent interpreted true widths).

Drill Hole No.	Easting	Northing	Azimuth	Dip	Total depth
MMDD01	743328	6503022		90o	1248.4m
PHDD1201	741802	6503642		90o	969.5m
PHDD1202	739692	6507636		90o	1077.5m
PHDD1203	737499	6507582		90o	866.3m
PHDD1204	741867	6505406	225o	60o	1306.8
PHDD1205	737595	6505090		90o	790.3
PHDD1206	724360	6527433	325o	60o	641.2
PHDD1207	735425	6508032	090o	60o	885.6

Datum MGA 94 Zone 53. Holes vertical unless specified above.

The remaining holes intersected either altered metasediments or altered to fresh Donington Suite granite with some minor sulphides. No extensive zones of mineralisation were reported in the remaining drill holes.

Monax believes the Project remains highly prospective for Olympic Dam style iron oxide copper-gold mineralisation.

The Company will now turn its attention to other areas to help define the dimensions of the system and the location of other possible high grade mineralisation. The recent announcement by OZ Minerals about the new discovery at the Khamsin prospect provides encouragement for further testing of untested gravity features within the northern part of the Project area (see OZ Minerals ASX Release 21 January 2013).

The Technical Committee is scheduled to meet in February 2013 where it will review the recently completed drilling program and discuss the future exploration program.

The Punt Hill Project remains the cornerstone exploration focus for Monax, backed by strong, ongoing support from Antofagasta.

Antofagasta has already invested approximately US$3.8 million in the Project since August 2010. Under the Punt Hill Farmin Agreement, Antofagasta can earn a 51% interest in the project upon reaching US$4 million expenditure in the Project.

Quarterly report for the period ending 31 December 2012 ~ 4 ~

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Figure 2. Location of drill holes on the Punt Hill project (Red dots 2012 drill holes; yellow dots pre-2012 drill holes).

Monax | Antofagasta Strategic Alliance

In October 2011, Monax announced the formation of a Strategic Alliance with Antofagasta Minerals Adelaide Pty Ltd (“Antofagasta”), a wholly owned subsidiary of ‘Antofagasta plc’, a major international copper mining company, for project generation in South Australia.

Monax now has 15 tenements covering five separate areas, all located in South Australia, which are potentially subject to the Alliance.

The terms of the agreement require that Antofagasta spend through Monax US$1 million over two years to facilitate area prospectivity identification and analysis, basic exploration, project generation and target selection. Any initial properties that are identified as a project of interest become a ‘Designated Project’ (DP). Once a DP has been formed, Antofagasta will have acquired a 51% interest and Monax a 49% interest in the Project.

Antofagasta will then have the option to earn an additional 19% of any DP (cumulative 70% interest) by spending a further US$4 million on exploration within three years and upon

Quarterly report for the period ending 31 December 2012 ~ 5 ~

earning this interest it will subsequently be required to make an additional cash payment (success fee) to Monax of US$3 million.

The 15 Alliance tenements are outlined below (see Figure 1 and Table below for location and tenement details):

tenement details):
Project	Tenement	No.	Status	Area
Marla	Christmas Well	ELA 2012/00261	Application	320 km2
	Mount Alice	ELA 2012/00278	Application	811 km2
Algebuckina	Algebuckina	EL 5093	Granted	323 km2
	Douglas Creek	EL 5094	Granted	839 km2
	Old Umbum	EL 4990	Granted	540 km2
WGC	Nullarbor	EL 5077	Granted	541 km2
	North Yalata	ELA 2012/00064	Granted	754 km2
	West Yalata	EL 4992	Granted	690 km2
	Yalata	EL 4993	Granted	544 km2
	East Yalata	ELA 2012/00276	Application	904 km2
Olympic IOCG	Arthur Hill	ELA 2012/00250	Application	346 km2
	Hunts Bore	ELA 2012/00318	Application	271 km2
	Vanguard	ELA 2012/00326	Application	424 km2
Kangaroo Island	Parndana	ELA 2012/00067	Application	868 km2
	West of Parndana	ELA 2012/00068	Application	226 km2

Algebuckina Designated Project

The Algebuckina DP (“ADP”) comprises three Alliance tenements and two tenements held by Falcon Minerals Limited (ASX:FCN) (“Falcon”) – refer ASX Announcement 19 December 2012 - and is located on the northern margin of the Gawler Craton in northern South Australia (Figure 1).

The ADP is located within the Peake and Denison Inlier and exploration will commence upon approval by the South Australian Government of the recently signed Option to Purchase Agreement.

Once this approval has been granted and the Aboriginal heritage process has been completed, a detailed gravity survey is planned over four selected targets.

The Marla, WGC, Olympic IOCG and Kangaroo Island projects are at an early stage of evaluation by the Alliance, and these projects have not yet been approved as Designated Projects.

Monax is currently reviewing a number of other opportunities for consideration by the Alliance and will keep shareholders informed on developments.

Quarterly report for the period ending 31 December 2012 ~ 6 ~

Waddikee Project – graphite, manganese and iron (Monax 100%)

The Waddikee Project (EL 4662) is located approximately 100 kilometres south-west of Whyalla, within an area that is becoming the premier graphite province in South Australia (Figure 1).

A program of mapping and sampling has commenced to provide further geological information for planned drilling to commence in February 2013. Work at the Wilclo South prospect has extended the surface exposure of visible flake graphite up to >2.5km in strike length. Areas mapped and sampled are shown on Figure 3.

The Wilclo South prospect contains a prominent airborne electromagnetic (AEM) anomaly and previous sampling and drilling was confined to the northern part of the area, within an uncropped paddock. With harvesting completed, access to the southern area was approved with several outcrops of coarse, visible flake graphite sampled (Figure 4). Graphitic float collected from the area was also sampled and appears to indicate two potential limbs of a large regional fold structure (Figure 4).

Fourteen samples were collected at the Wilclo South prospect (see Plates 1 & 2).

The Francis prospect located approximately 5.3km west south-west of the Wilclo South prospect was targeted due to a strong AEM anomaly. Figure 5 shows the location of four graphite float samples collected from the area within a zone of anomalous AEM and historical ground electromagnetic (EM) data. The float graphite samples all contained visible flake graphite.

Monax is encouraged by the discovery of float graphite over this strong EM anomaly at the Francis prospect.

The Company is planning several lines of detailed ground EM to assist with locating drill holes to target the highly conductive feature, which possibly represents a new zone of coarse visible flake graphite. Historical EM data at Francis contains the highest EM values within the area and the anomaly is up to 3.5km in length.

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Plate 1: Sample of visible coarse graphite float from Wilclo South.

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

Quarterly report for the period ending 31 December 2012 ~ 7 ~

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Figure 4. 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 5. 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).

Quarterly report for the period ending 31 December 2012 ~ 8 ~

Phar Lap Copper-Gold Project (Monax 100% of all minerals excluding uranium; Marmota 75% uranium, Monax 25% uranium)

EL 5124 (Phar Lap) is located about 60km west north-west (WNW) of the Prominent Hill mine, on the south-western margin of the Mt Woods Inlier in South Australia’s Far North. The Mt Woods Inlier contains the Prominent Hill (Cu-Au) and Cairn Hill (Fe-Cu) mines, as well as several IOCG style targets including Joes Dam and Manxman.

Monax is continuing the land access process and plans to drill these targets in early to mid 2013.

Yorke Peninsula Project – copper-gold

Monax has two sub-projects located on the Yorke Peninsula in South Australia. They are:

1. Melton (50:50 Joint Venture with Marmota)

2. Webling Bay (100% Monax)

No exploration was undertaken on the Webling Bay project during the quarter.

Joint venture partner Marmota reported anomalous copper and gold values from a calcrete sampling program on the Melton project (see MEU ASX Release 10 September, 2012 for full details). Further calcrete sampling is planned to commence in February 2013.

Quarterly report for the period ending 31 December 2012 ~ 9 ~

Exploration Program planned for current quarter (January – March 2013)

Punt Hill – copper-gold

• Review drilling data.

• Plan next phase of exploration.

Monax | Antofagasta Strategic Alliance

• Ongoing identification of potential new potential copper projects within South Australia.

• Continue assessment of copper projects currently under review within South Australia by the Company.

• Obtain approval and undertake gravity survey on Algebuckina Designated Project.

Waddikee – graphite, iron and manganese

• Ongoing mapping and sampling.

• Complete ground EM survey (commenced mid-January).

• Undertake RC drilling program.

• Assess metallurgical results.

• Continue assessment of the Project’s iron potential.

Phar Lap – copper-gold

• Continue land access process.

Yorke Peninsula – copper-gold

• Melton Joint venture – calcrete sampling program (planned to commence in February 2013).

For further information please contact:

Gary Ferris Managing Director Monax Mining Ph: (08) 8375 3900 Email: info@monaxmining.com.au

Duncan Gordon Investor Relations Ph: 0404 006 444

‘The information in the Quarterly Report that relates to Exploration Results, Mineral Resources, Ore Reserves or targets 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.’

Quarterly report for the period ending 31 December 2012 ~ 10 ~

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

	Monax Mining Limited	Monax Mining Limited
	ABN 96 110 336 733 Consolidated statement of cash flows
			31 December 2012
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) Cash call contributions under JV agreements Other Net Operating Cash Flows		Current quarter $A’000		Year to date ( 6 months) $A’000
		- (1,608) - - (224) - 50 - - 756 112		- (2,892) - - (453) - 68 - - 2,798 34
		(914)		(445)
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)		- - 20 647 - (9) - -		- (3) 25 647 - (9) - -
		658		660
		(256)		215

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(256)	215
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) Net financing cash flows	- - - - - -	- - - - -
	-	-
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	(256) 2,881 -	215 2,410 -
	2,625	2,625

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
		(216)
		-
1.25	Explanation necessaryfor an understandingof the transactions
	The amount at 1.23 above represents non executive directors’ fees and executive director’s salary (including SGC superannuation), legal fees paid to a legal firm in which a director is a partner, contributions to Joint Venture expenditure made to a related party and service fee payments to an associated entity. The amount at 1.24 above represents costs to be recovered in relation to shared facilities from a related entity.

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

• 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

• See chapter 19 for defined terms.

Appendix 5B Page 2

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Appendix 5B Mining exploration entity quarterly report

Marmota Energy Limited pursuant to the Farm-In and Joint Venture Agreements for EL 4510 (formerly EL 3358), EL 3910, EL 3907, EL 3911and EL 4000 has incurred on an accruals basis $40,017 in the quarter ending 31 December 2012.

Antofagasta Minerals S.A. pursuant to the Farm-In Option Agreement – Punt Hill Project for EL 4642 and EL 4548 has incurred on an accruals basis $1,369,506 in the quarter ending 31 December 2012.

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
	550
	-
	-
	245
Total	795

Reconciliation of cash

Total Reconciliation of cash		795
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 Bank overdraft 5.4 Other (provide details)	858	1,114
	1,765	1,765
	-	-
	2	2
Total: cash at end of quarter(item 1.22)	2,625	2,881

• See chapter 19 for defined terms.

Appendix 5B Page 3

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Appendix 5B Mining exploration entity quarterly report

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
	EL 4991 ELA 2011/00276 ELA 2012/00268 ML 30220 ML 30221 ML 30222 ML 30223 ML 30224 ML30225	Relinquished Withdrawn Withdrawn Sold Sold Sold Sold Sold Sold	100% 100% 100% 100% 100% 100% 100% 100% 100%	0% 0% 0% 0% 0% 0% 0% 0% 0%
	EL 5077 (formerly ELA 2012/00269) EL 5093 (formerly ELA 2011/00269) EL 5094 (formerly ELA 2011/00270) ELA 2012/00261 ELA 2012/00278 ELA 2012/00318 ELA 2012/00319 ELA 2012/00326 ELA 2012/00328	Granted Granted Granted Application Application Application Application Application Application	100% 100% 100% 0% 0% 0% 0% 0% 0%	100% 100% 100% 100% 100% 100% 100% 100% 100%

• See chapter 19 for defined terms.

Appendix 5B Page 4

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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 note3) (cents)	Amount paid up per security (see note3) (cents)
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	149,514,803	149,514,803
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	215,000 10,000 425,000 225,000 325,000	Nil Nil Nil Nil Nil	Exercise Price $0.246 $0.0517 $0.0517 $0.051 $0.053	Expiry Date 18/07/2013 23/12/2013 05/03/2015 28/07/2016 23/07/2017
7.11 Debentures (totals only)

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

7.12 Unsecured notes (totals only)

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: ....31/01/2013....... ( ~~Director~~ /Company secretary)

Print name: Virginia Suttell

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 6

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