FIRSTWAVE CLOUD TECHNOLOGY LIMITED — Interim / Quarterly Report 2011

Jul 27, 2011

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Tellus Resources Ltd
ABN: 35 144 733 595
Suite 301, Level 3
66 Hunter Street,
SYDNEY NSW 2001
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ASX RELEASE

28 JULY 2011

Tellus Resources Ltd is an Australian‐based mineral exploration company.

Tellus has acquired a large tenement package in regional New South Wales prospective for Intrusive Related Gold Deposits (IRG).

A number of the tenements encompass historic goldfields, but have received relatively little in the way of modern exploration.

QUARTERLY REPORT

For the period ending 30 June 2011

HIGHLIGHTS

• High‐grade veins up to 9.56 g/t gold located at surface at Glen Morrison in Southern New England

• Tellus Resources listed on the Australian Securities Exchange after completion of successful $4.25 million initial public offering

Projects & Exploration

Projects:

Southern New England

• Glen Morrison Project (EL7699)

• Cobark Project (EL7698)

Southern New England IRG Project, NSW

Glen Morrison (EL7699, TLU: 100%)

Reconnaissance rock chip sampling around the Golden Bar and Golden Star Reefs at Glen Morrison have returned high grade gold values up to 9.56 g/t gold .

Southeast Lachlan

• Cobargo (EL7721)

• Brogo (EL7723)

• Yurammie (EL7722)

• Yambulla (EL7720)

Representative samples of different vein styles were taken from mullock around the old workings to identify the most productive veins. Two main styles were sampled; two laminated quartz‐calcite‐arsenopyrite vein samples (Figure 1) returned 9.56 g/t and 1.42 g/t gold respectively and a brecciated vein returned 2.63 g/t gold .

Directors/Officers:

Anthony Wehby David Ward Richard Willson Anne Adaley

Issued Shares and Options:

26,150,000 shares 6,000,000 unlisted options

Tellus Resources Ltd

ASX Code: TLU

T: +61 2 9231 6231 F: +61 2 9231 6687 W: www.tellusresources.com.au

Historically one of these veins was reported to have produced 70,000 ounces of gold in the late 1800’s.

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Figure 1 – Laminated veining at Glen Morrison that returned 9.56 g/t gold

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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A drilling contractor has been secured for 2,000 metres of RC drilling in July‐August and plans to test the ‘reefs’ at depth. Soil sampling has already commenced and is designed to identify further mineralisation along known strike of the veins.

Three lines of workings and veins have been mapped over 170 metres each. Sampling from the wall of another historic pit well along strike to the north‐west returned 0.60 g/t gold, suggesting the gold rich vein system may extend for at least 670 metres to the north‐west and is open to the south‐east.

The most extensive workings were developed on the Golden Star Reef (Figure 2). Although no strong veining was left around the main access shaft to sample, a siltstone with disseminated arsenopyrite returned 0.475 g/t gold; interpreted to be the mineralised margin of a higher grade vein.

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Figure 2 – Mapped workings on Aerial Photo. Solid red lines indicate known extent of the quartz‐calcite‐ arsenopyrite veining. Dashed red lines indicate interpreted extent of the veining. Rockchip samples = yellow triangles labelled by gold (g/t)

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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Southern Lachlan Project, NSW

No work was undertaken during the June quarter.

Corporate

Successful IPO

Tellus Resources listed on the Australian Securities Exchange during the June quarter after successfully completing an initial public offer that raised $4.25 million. The Company listed on 11 May, 2011 with shares quoted under the code TLU.

The Board has been extremely encouraged by the strong support shown to the Company and the endorsement of its current exploration strategy and future resource development plans.

Outlook

Work during the September Quarter will focus on follow‐up drilling at Glen Morrison to test the depth extents of surface veining. An announcement will be made on the commencement of drilling with progress results and updates as they are received.

Since the end of the quarter, the Southeast Lachlan geophysical survey has been released. Processing of the aeromagnetic data will provide Tellus with a number of targets for evaluation and follow‐up.

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Glen Morrison
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Figure 3 – Project Areas on State Government Aerial RTP Magnetics

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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For further information on this announcement or Tellus Resources please contact:

David Ward Technical Director T: 0419 979 786 E: david.ward@tellusresources.com.au

Anne Adaley Company Secretary & Chief Financial Officer T: 02 9231 6231

E: anne.adaley@tellusresources.com.au

or visit our website at www.tellusresources.com.au

For Investor and Media Enquiries: Ophir Partners ‐ Stuart Glazebrook ‐ 0402216835.

Competent Person’s Statement

The information in this report that relates to Exploration Results, Mineral Resources and/or Ore Reserves is based on information provided by Mr D Ward, Member of Australasian Institute of Mining and Metallurgy and a Technical Director of Tellus Resources Limited. Mr Ward has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify 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 Ward, consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Disclaimer

This document has been prepared by Tellus Resources Limited (“Tellus”) and may contain some references to forecasts, estimates, assumptions and other forward looking statements. These forward‐looking statements reflect the current internal projections, expectations or beliefs of Tellus based on information currently available to Tellus. Although the company believes that its expectations, estimates and forecast outcomes are based on reasonable assumptions, it can give no assurance that they will be achieved. They may be affected by a variety of variables and changes in underlying assumptions that are subject to risk factors associated with the nature of the business, which could cause actual results to differ materially from those expressed herein. Statements concerning reserves and/or resources may also be deemed to be forward looking statements in that they involve elements based on specific assumptions.

Tellus Resources Limited has taken all reasonable care in producing the text and images contained in this report but do not warrant that the information contained herein is accurate or up to date. The information in this report is based on publicly available information, internal data and information from other sources. It is not intended to give investment or other advice to any party or individual(s) and the information is not a substitute for detailed investigation or analysis. Tellus Resources Limited will not be responsible for any loss or damage (direct or indirect, consequential or otherwise) resulting from the use of information provided in this report.

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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APPENDIX 5B

Mining exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10

Name of entity	Name of entity	Name of entity
Tellus Resources Ltd
ABN 35 144 733 595 Consolidated statement of cash flows	Quarter ended (“current quarter”)
		30 June 2011
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration and evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (provide details if material) Net operating cash flows		Current quarter $A’000	Year to date (12 months) $A’000
		- (43) - - (338) - 11 - - -	- (43) - - (508) - 16 - - -
		(370)	(535)
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: Payments for security deposits and exploration licence applications Net investing cash flows		- - (18) - - - - - (4)	- - (19) - - - - - (75)
		(22)	(94)
1.15 Total operating and investing cash flows (carried forward)		(392)	(629)

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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1.15 Total operating and investing cash flows (brought forward)	(392)	(629)
Cash flows related to financing activities 1.16 Proceeds from issues of shares, options, etc. 1.17 Proceeds from sale of forfeited shares 1.18 Proceeds from borrowings 1.19 Repayment of borrowings 1.20 Dividends paid 1.21 Other: Share issue costs Net financing cash flows	4,250 - - - - (327)	4,709 - - - - (376)
	3,923	4,333
Net increase (decrease) in cash held 1.22 Cash at beginning of quarter/year to date 1.23 Exchange rate adjustments to item 1.20 1.24 Cash at end of quarter	3,531 173 -	3,704 - -
	3,704	3,704

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

1.25 1.26	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to theparties included in item 1.10	Current quarter $A'000
		24
		-
1.27	Explanation necessaryfor an understandingof the transactions
	Consulting fees: $24,000

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

Nil

• 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

Nil

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	-	-
	-	-

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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Estimated cash outflows for next quarter

Estimated cash outflows for next quarter
4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration Total	$A’000
	473
	-
	-
	125
	598

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
5.1 Cash on hand and at bank 5.2 Deposits at call 5.3 Commercial Bills 5.4 Other: Term Deposit Total: cash at end of quarter(item 1.22)	32	173
	1,672	-
	-	-
	2,000	-
	3,704	173

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	Interest at beginning of quarter	Interest at end of quarter
	None
	None

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

	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
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs	26,150,000	26,150,000
	17,000,000	17,000,000
7.5 Convertible debt securities(description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7 Options Unlisted 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter 7.11Debentures (totals only) 7.12Unsecured notes (totals only)	6,000,000	-	Exercise price 30 cents	Expiry date 31 March 2014
	1,200,000	-	30 cents	30 April 2014

QUARTERLY REPORT FOR THE PERIOD ENDED 30 JUNE 2011

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Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5).

• 2 This statement does give a true and fair view of the matters disclosed.

Sign here: Company Secretary

Date: 28 July 2011

Print name: Anne Adaley

Notes

• 1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

• 2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

• 3 Issued and quoted securities. The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities .

• 4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

• 5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.