HILLGROVE RESOURCES LIMITED — Capital/Financing Update 2012

Aug 23, 2012

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Friday, 24 August 2012

HILLGROVE COMPLETES $3.9 MILLION SHARE PURCHASE PLAN

Hillgrove Resources Limited (ASX: HGO) is pleased to advise that the Company has raised $3.9m under the Share Purchase Plan (“SPP”) from existing shareholders and that it has accepted all applications which complied with the SPP terms and conditions.

The SPP was announced on 19 July 2012 and closed on 17 August 2012, and follows the $15 million placement (“Placement”) that was approved by shareholders at the Company’s Extraordinary General Meeting held yesterday.

The proceeds of the Placement and SPP will be used to supplement the Company’s existing cash resources and working capital.

The issue price for shares issued under the SPP will be 7.53 cents per share. The share price was calculated at a discount of 5% to the volume weighted average price of shares traded in the ordinary course on the ASX during the five trading days up to, and including, 17 August 2012, rounded down two decimal points for each cent. Under the SPP 52,443,559[1] new shares will be issued to participating eligible shareholders.

Holding statements detailing the allocation of new shares under the SPP are expected to be despatched on 30 August 2012 by the Company’s share registry, Boardroom Limited, and normal trading of shares issued under the SPP is expected to commence on the same day. Application forms received from shareholders in relation to the SPP were reviewed and, in certain limited circumstances, some applications were rejected if they were non-compliant with the SPP terms and conditions. Accordingly, shareholders who have participated in the SPP are advised to await receipt of holding statements prior to dealing in any shares applied for under the SPP.

For more information contact:

Russell Middleton Shanthi Smith CEO (Acting) CFO (Acting)/Company Secretary Tel: +61 (0)2 8247 9300 Tel: +61 (0)2 8247 9300

1 Subject to rounding

IIII HILLGROVE RESOURCES LIMITED Level 41 Australia Square, 264 George Street, Sydney NSW 2000, Australia T +61 2 8221 0404 F +61 2 8221 0407 www.hillgroveresources.com ACN 004 297 116

HILLGROVE RESOURCES LIMITED

ABOUT HILLGROVE

Hillgrove is an Australian mining company listed on the Australian Securities Exchange (ASX: HGO) focused on the operation of the Kanmantoo Copper Mine in South Australia, and exploration on its Indonesian tenements, where the Company is targeting the discovery of world class epithermal gold and porphyry copper/gold.

The Kanmantoo Copper Mine is located less than 55km from Adelaide in South Australia. With construction now completed, Kanmantoo is an open-cut mine, and is ramping up to an initial throughput of 2.4Mt per annum in 2012, to produce approximately 80,000 tonnes of concentrate per annum.

Global Mineral Resource (March 2012)

	JORC	Tonnage	Cu	Au	Ag	Bi	Cu Metal
	Classification	(Mt)	(%)	(g/t)	(g/t)	(g/t)	(kt)
In SituResource	MeasuredIndicated	4.220.5	0.850.87	0.130.16	2.262.34	173129	35.3178.3
	Inferred	6.5	0.66	0.15	1.73	114	43.0
Long TermStockpiles	MeasuredIndicated	1.1 0.5	0.460.18	N/AN/A	N/AN/A	N/AN/A	5.0 0.9
	Total	32.8	0.80	0.15	2.20	132	262.6

Note: The estimation of Bi is based on limited sampling data. Bi is recognised as a potential penalty element. As at end of March 2012.

2012 In Situ Resource > 0.25% Cu.

Long Term Stockpiles > 0.15% Cu. Au, Ag and Bi assays are not available.

Ore Reserve (April 2010)

Category	**Tonnage **	Cu	Au	Ag
	Mt	(%)	(g/t)	(g/t)
Proved	2.3	0.87	0.13	3.2
Probable	12.5	0.84	0.18	3.1
Ore Reserve	14.8	0.85	0.17	3.1

Competent Person's Statements

The information in this release that relates to Kanmantoo Exploration Results, Exploration Targets and Stockpiles is based on information compiled by Mr Pat Manouge, who is a Member of The Australian Institute of Geoscientists. Mr Manouge is the Kanmantoo Copper Mine Exploration Manager for Hillgrove Resources and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration 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 (JORC Code)’.

The information in this release that relates to in situ Mineral Resource estimates is based on information compiled by Mr Aaron Meakin, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Meakin is a full-time employee of AMC Consultants Pty Ltd and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration 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 (JORC Code)’.

The information in this release that relates to Ore Reserve estimates is based on information compiled by Mr Geoff Davidson, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Davidson is a Principal Consultant and Director of Mining and Cost Engineering Pty Ltd and has sufficient relevant experience 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 (JORC Code)’.

The Competent Persons have consented to the inclusion in the release of the matters based on their information in the form and context in which it appears.