FORTUNA METALS LTD — Capital/Financing Update 2012

Oct 17, 2012

CONTACTS PHONE EMAIL PO Box 52 +61 (08) 9295 0388 info@frontierresources.com.au West Perth FAX W EBSITE WA 6872 Australia +61 (08) 9295 3480 www.frontierresources.com.au

ABN 96 095 684 389 ASX : FNT

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ASX Limited

Company Announcements Office

18th October 2012

Variable Gold and Weak Copper Mineralisation Demonstrated in Bulago Holes 002-006

Frontier Resources Ltd announces assay results from drill holes BUL002 through BUL006 targeting porphyry copper -gold at EL 1595 - in Papua New Guinea

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• Nine drill holes have been completed by OTML at Bulago for 3,302.9m, including 2 holes at the Suguma high-grade gold Prospect.

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• Assay results for Holes BUL002 - BUL006 are reported herein. Assay results for holes BUL007, SUG001 and SUG002 are yet to be returned.

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• Each of the holes returned one or more intercepts of mineralisation with greater than 1.0 g/t gold and hole BUL002 demonstrated 63.2m grading 0.12% copper + 0.10 g/t gold.

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• Peak results included 5.9m of 1.71 g/t gold in hole BUL003, with up to 0.22% copper, 17.4 g/t silver and 118 ppm molybdenum.

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• Previously announced hole BUL001 returned (at 0.1% Cu cutoff) 124m grading 0.13 % copper + 0.06 g/t gold (from 119 to 243m), plus 76.1m grading 0.15% copper + 0.16 g/t gold (from 267 to 343.1m), plus 12.7m grading 0.11% copper + 0.10 g/t gold (from 371.8 to 384.5m) and 21m grading 0.42g/t gold + no significant copper (from 407 to 428m), including 3m of 2.04 g/t gold.

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The strongest copper in soil geochemistry zone in the central north of the grid remain to be drilled.

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• EL 1595 is part of an Earn-In Joint Venture with OK Tedi Mining Ltd, who are earning 58% by expending $US 12 million within 6 years.

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• OTML have been undertaking systematic ridge and spur soil sampling to complement Frontier's historic grid based work. This work will provide excellent geochemical coverage and enhanced vectoring for future drilling.

Hole ID	From (m)	To (m)	Intercept Length (m)	Gold Grade (g/t)	Copper Grade (ppm)	Silver Grade (g/t)	Molybdenum Grade (ppm)
BUL002 incl BUL003 incl plus plus BUL004 BUL005 incl BUL006 plus	27.8 86.1 19.1 63.5 367.1 379.0 80.0 0.0 197.0 20.5 83.9	91.0 87.0 389.6 139.4 373.0 381.0 81.5 363.1 199.0 22.0 85.5	63.2 0.9 370.5 75.9 5.9 2.0 1.5 363.1 2.0 1.5 1.6	0.10 1.32 0.06 0.04 1.71 0.50 1.22 0.09 1.80 3.19 2.57	1152 585 347 674 92 178 280 95 173 158 199	0.6 5.8 0.3 0.3 3.4 5.5 0.3 0.3 0.4 2.0 15.0	23 8 20 40 2 1 15 3 4 2 5

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Figure 1 shows the location of the Bulago El in western Papua New Guinea on a geological plan that highlights the 3 known intrusive complexes.

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Figure 2 shows the prospect locations schematically within the anomalous gold in drainage zone on an SRTM topographic plan that highlights the Bulago basin.

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Figure 3 shows the Bulago drillhole locations on the copper in soil geochemistry contours. NB Hole BUL007 is not plotted but is located in the central south section of the grid and copper anomaly.

Hole ID	Peak Gold Grade (g/t)	Peak Copper Grade (ppm)	Peak Silver Grade (g/t)	Peak Molybdenum Grade(ppm)
BUL002 BUL003 BUL004 BUL005 BUL006	1.32 2.81 1.22 1.80 3.19	2250 1185 529 804 572	5.8 5.5 0.5 1.7 17.4	62 118 35 20 9

The geochemistry indicates two possible mineralisation events, a copper event with some gold and a gold only event.

EL 1595 - Bulago Drill Hole Location and Orientation Information

BUL006 3.19 572 17.4 9	BUL006 3.19 572 17.4 9	BUL006 3.19 572 17.4 9	BUL006 3.19 572 17.4 9	BUL006 3.19 572 17.4 9	BUL006 3.19 572 17.4 9	BUL006 3.19 572 17.4 9
EL 1595 - Bulago Drill Hole Location and Orientation Information
HOLE ID	EOH DEPTH (m)	Azimuth (true)	Incl.	AMG North (m)	AMG Easting (m)	RL (m)
BUL001 BUL002 BUL003 BUL004 BUL005 BUL006 BUL007	440.3 331.1 389.6 115.0 363.1 422.4 649.5	295 180 210 270 160 180 0	-60 -70 -60 -60 -70 -60 -65	9399870 9399385 9399868 9399052 9399075 9399485 9399086	639180 639379 639182 639723 639171 638919 638540	1653.0 1716.0 1654.0 1658.0 1910.0 1801.0 ?
SUG01 SUG02	329.8 262.1	0 25	-90 -50	9400257 9400195	637091 637024	1684 1647
Total 3,302.9 m
AGD66 Zone 54

The 0.2% copper and 0.1 g/t gold cut off grades failed to adequately define the mineralised zones in the holes and a 0.1% cut off was used with limited internal dilution. Zones were defined by similar geochemistry.

Weighted drill assay results, assay highlights and drill collar information (reference datum is AMG Zone 54, AGD 66) are tabulated herein.

Core from holes BUL002- 006 AGD66 Zone 54 was cut in half onsite longitudinally by diamond bladed cut-off saw. Half core was sampled as appropriate relative to geology; they were flown to Tabubil for sample preparation and were assayed by Australian Analytical Laboratories in Townsville by fire assay (50g charge) for gold and ICP for copper, molybdenum, silver, lead, zinc, arsenic and other elements. Suitable internal standards are used as appropriate.

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EL 1595 - Bulago is located in PNG between the World Class OK-Tedi porphyry copper-gold and the Porgera epithermal/intrusive related gold Deposits. Targets are porphyry copper- gold, high-grade epithermal gold and skarn gold deposits.

The prospects are located in a 4.5km x 6km well-defined gold, zinc and copper drainage anomaly covering a recessive intrusive in a sub-circular drainage basin, with anomalism continuing up to the peripheral limestones (demonstrating skarn potential). The Suguma Prospect has very high gold grades in structures and is located in the NW of the grid.

For additional information relating to Frontier Resources, please visit the Company’s website at www.frontierresources.com.au or feel free to contact me.

FRONTIER RESOURCES LTD

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P.A.McNeil, M.Sc. CHAIRMAN / MANAGING DIRECTOR

The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by, or compiled under the supervision of Peter A. McNeil - Member of the Aust. Inst. of Geoscientists. Peter McNeil is the Managing Director of Frontier Resources, who consults to the Company. Peter McNeil has sufficient experience which is relevant to the type of mineralisation and type of deposit under consideration to qualify as Competent Person as defined in the 2004 Edition of the Australasian Code of Reporting Exploration Results, Mineral Resources and Ore Resources. Peter McNeil consents to the inclusion in the report of the matters based on the information in the form and context in which it appears.

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