IRON BEAR RESOURCES LTD — Interim / Quarterly Report 2015

Jan 22, 2015

December 2014 Quarterly Report 23 January 2015

23 January 2015

Cape Lambert Resources Limited (ASX: CFE) is a fully funded mineral development company with exposure to iron ore, copper, gold, uranium, manganese, lithium and lead-silverzinc assets in Australia, Europe, Africa and South America.

Australian Securities Exchange

Code: CFE

QUARTERLY REPORT – 31 December 2014

Please find attached the Quarterly Activities Report and Appendix 5B for the period ended 31 December 2014.

Ordinary shares 626,686,586

Unlisted Options 500,000 ($0.15 exp 30 Sept 2015) 9,225,000 ($0.088 exp 18 Dec 2016)

Board of Directors Tony Sage Executive Chairman

Yours faithfully Cape Lambert Resources Limited

Tim Turner Non-executive Director

Jason Brewer Non-executive Director

Tony Sage

Ross Levin Non-executive Director

Executive Chairman

Melissa Chapman Company Secretary

Key Projects and Interests

Marampa Iron Ore Project Pinnacle Group Assets

Cape Lambert Contact

Tony Sage Executive Chairman

Eloise von Puttkammer Investor Relations

Phone: +61 8 9380 9555 Email: info@capelam.com.au

Australian Enquiries

Professional Public Relations David Tasker Phone: +61 8 9388 0944 Mobile: +61 433 112 936 Email: david.tasker@ppr.com.au

UK Enquiries

Tavistock Communications Emily Fenton / Jos Simson Phone: +44 (0)207 920 3150 Mobile: +44 (0)7899 870 450

Cape Lambert Resources Limited December 2014 Quarterly Report

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HIGHLIGHTS

Corporate

• At 31 December 2014, the Company had approximately A$16.7 million in cash at bank.

• Cape Lambert negotiated a US$20 million financing agreement with Timis Mining to fund its acquisition of the London Mining Marampa mine which includes:

• US$8 million bridging loan over a 12 month period; and

• US$12 million purchase of a Royalty.

• Cape Lambert will receive US$2/t royalty for 4 years from iron concentrate exported from Timis Mining Marampa mine to provide Cape Lambert with a royalty stream of potentially up to US$56 million.

• Timis Mining will have exclusive rights to mine and acquire 100Mt of oxide material from Cape Lambert’s Sierra Leone Projects at a price of US$3 to US$5/t, potentially earning US$300 to US$500 million for the Company.

• Annual General Meeting held and all resolutions passed on a show of hands.

• Post quarter end, Cape Lambert announced cost savings of ~A$3.5 million and the postponement of the second dividend payment.

Projects

Marampa Iron Ore Project – Sierra Leone

• Negotiations for the mine lease agreement with the Government of Sierra Leone to commence.

• An agreement for the mining and purchase of weathered ore by Timis Mining being finalised.

Gold Prospects – Cote D’Ivoire

• Geological mapping and ground truthing of the geophysical data was undertaken by consultants SRK across all 3 tenements during the quarter. A report outlining prospective targets for gold mineralisation is expected to be received early in the next quarter for review.

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CORPORATE

Strategy and Business Model

Cape Lambert Resources Limited ( ASX: CFE ) ( Cape Lambert or the Company ) is an Australian domiciled, fully funded, mineral development company. Cape Lambert has interests in several exploration and mining companies, providing exposure to iron ore, copper, gold, uranium, manganese, lithium and lead-silver-zinc assets in Australia, Asia, Europe, Africa and South America (refer Figure 1).

Cape Lambert’s strategy is to acquire and invest in undervalued and/or distressed mineral assets and companies ( Projects ) and:

• improve the value of these Projects, through a hands on approach to management, exploration, evaluation and development; and

• retain long-term exposure to these Projects through a production royalty and/or equity interest.

Cape Lambert aims to deliver Shareholder value by adding value to these undeveloped Projects. If Projects are converted into cash, the Company intends to follow a policy of distributing surplus cash to Shareholders.

Capital Management

Dividend Payment

Post quarter end, the Company announced that the Board has conducted a thorough review of it’s capital management strategy in light of falling iron ore prices and deteroriating market conditions (refer ASX Announcement 7 January 2015).

As a result of the review, Cape Lambert has instituted a range of cost reduction measures across its business, which includes reducing its full time workforce by 117 people, reduced exploration activities across its portfolio of assets and placing some non-core assets on ‘care and maintenance’. The total annual savings generated by these measures is expected to be approximately A$3.5 million.

In addition to these measures, the Board also determined it prudent to postpone the second dividend payment to shareholders scheduled for payment on 27 February 2015. The Cape Lambert board believed that postponing the upcoming dividend payment was a sound financial decision at an uncertain time in the mining sector. Cape Lambert will advise on a rescheduled timeline for this dividend payment in due course.

On Market Buy-Back

Subsequent to the quarter end, the Company’s on market share buy-back of up to 10% of the Company’s fully paid ordinary shares ( Shares ) within the 12 months from 23 January 2014 completed. Shares bought back by the Company are subsequently cancelled. A total of 41,252,301 Shares were purchased under the facility for a consideration of $4,244,992.

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Investments

Timis Mining Corporation Finance Agreement

During the quarter, the Company announced (Refer ASX Announcement 22 October 2014) that it had entered into a binding terms sheet with Timis Mining Corporation SL Limited and Timis Mining Corporation Limited (collectively Timis Mining ) to provide financing of US$20 million to assist Timis Mining with its acquisition of the Marampa Iron Ore Mine ( Mine ) in Sierra Leone from the administrator of London Mining PLC (London Mining) ( Agreement ).

The Agreement is divided into two parts including:

• (a) US$8 million Bridging Finance ; and

• (b) US$12 million for purchase of a royalty ( Royalty Purchase) .

Bridging Finance

The US$8 million Bridging Finance is repayable in 12 months and incurs interest of 3 month US LIBOR + 6%.

The principal and interest will be repaid to Cape Lambert in one payment at the expiry of the 12 month loan period and can be extended by the parties on mutually agreed terms.

Royalty Purchase

The Company negotiated the purchase of a royalty for US$12 million with Timis Mining in exchange for a royalty payment of US$2 per tonne of iron concentrate exported from the Mine ( Royalty ).

The Royalty is payable on a quarterly basis and will commence from the first shipment of concentrate from the Mine following the completion of the acquisition of the Mine by Timis Mining from the administrator of London Mining.

The Royalty will be payable over a four year period and in the event the Mine temporarily suspends production for a force majeure event, the Royalty period will be extended by the same period that the force majeure event continues.

Exclusive Rights to Acquire Cape Lambert’s Oxide Material

Cape Lambert has also negotiated the sale of oxide material from its Sierra Leone Projects to Timis Mining. Under the terms of the Agreement, Timis Mining will have exclusive rights to purchase 100 million tonnes of oxide material, or such greater amount as defined by further drilling from Cape Lambert’s adjacent Sierra Leone Projects.

The price at which the oxide material will be purchased from Cape Lambert is expected to be in the range of US$3 to US$5 per metric tonne.

A drilling campaign to increase the upside of Cape Lambert’s oxide resources is planned to begin 12 months after Timis Mining commences mining at Cape Lambert’s Sierra Leone Projects. This drilling campaign, together with any costs associated with mining operations, will be bourne by Timis Mining and not Cape Lambert.

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An agreement to formalise Timis Mining’s exclusive rights to purchase Cape Lambert’s oxide material ( Mining Agreement ) is currently being finalised. Mining of oxide material at Cape Lambert’s Marampa Project can commence once the mine lease agreement with the Government of Sierra Leone is finalised.

Rights to Match

Timis Mining may sell its interest in its Mine and Cape Lambert can sell its oxide material at any time during the period of this agreement. In the event that Timis Mining sells the mine, then it will use its reasonable endeavours to incorporate the sale of Cape Lambert’s Sierra Leone Projects at the same time.

Should the mine be sold without a sale of Cape Lambert’s Sierra Leone Projects, then the Royalty and Briding Finance obligations continue with any new third party owner and the new third party owner will be obligated to purchase the oxide material on the same basis as agreed between the parties.

Should Cape Lambert sell its Sierra Leone Projects without a sale of Timis Mining’s mine, then the Royalty obligations continue with any new third party owner of Cape Lambert’s Sierra Leone Projects and the new third party owner will be obligated to sell the oxide material to Timis Mining on the same basis as agreed between the parties.

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PROJECTS

Marampa (100% interest)

Marampa is an iron ore project at development and permitting stage, and is located 90 km northeast of Freetown, Sierra Leone, West Africa ( Marampa or Marampa Project ) (refer Figure 2). Marampa comprises two granted exploration licences (EL46A/2011 – 239.18 km[2] and EL46B/2011 – 66.00 km[2 ] (formerly EL46/2011 – 305.18 km[2] )) held by Marampa Iron Ore (SL) Limited, which is indirectly, a wholly owned subsidiary of Cape Lambert.

Exploration

No exploration activities occurred during the quarter.

Topographic Surveying

The survey of the farms and crop counting for compensation assessment in the proposed plant site area and railway yards were completed during the period.

Mining Licence

On 15 October 2014, the Company received a notice from the Ministry of Mineral Resources ( MoMR ) that its Large Scale Mining Licence application lodged late in 2013 was approved, subject to the Company notifying the MoMR of its willingness to accept the proposed licence and making payment of the annual mining licence fee. The Company accepted the proposed mining licence and has made payment of the appropriate statutory fee.

In anticipation of the negotiation of the associated mine lease agreement, that sets out the terms and conditions under which the Company would operate the large scale mine, the Company has drafted a mine lease agreement as a basis for the negotiations. The mine lease agreement is expected to take 6 to 9 months to finalise.

Downsizing

The Company has instituted cost reduction measures at Marampa and commenced to downsize its workforce to a skeleton crew while current market uncertainties exist. The downsizing measures will be finalised in early 2015.

Dempsey Resources (100% interest)

Dempsey Resources holds the Kukuna Iron Ore Project located in Sierra Leone ( Kukuna or

Kukuna Project ).

The Project is located 120 km northeast of Freetown in the northwest of Sierra Leone and consists of one exploration licence (EL22/2012) covering 68 km[2] (refer Figure 2). The licence is located 70 km due north of the Marampa Project and the Pepel Infrastructure and comprises rocks that correlate with the Marampa Group stratigraphy known to host specular hematite mineralisation.

The Kukuna project is currently under care and maintenance. The Company is maintaining the camp as a base for future exploration activities in and around the district.

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Metal Exploration Limited (100% interest)

Metal Exploration (Mauritius) Limited, a wholly owned subsidiary of Cape Lambert, holds 15 granted exploration licences and one application in Sierra Leone covering approximately 1,688km[2] . This land package covers the region 70 km to the north and south of Marampa and is referred to as the Rokel Iron Ore Project ( Rokel or Rokel Project ). Rocks from the Marampa Group exist throughout the licence areas, much the same as the Marampa Project, and are known to host specularite schist bearing units.

The Rokel Project is prospective for discovery of hematite schist deposits geologically similar to those at Marampa and is located proximal to the existing Pepel infrastructure (refer Figure 2). Regional mapping and geophysics has identified a number of prospective areas which are progressively being followed up with targeted exploration.

Exploration

Notification of the acceptance of 2 exploration lease relinquishments and partial relinquishments to 12 of the remaining 15 leases was received from the Ministry of Mining and Mineral Resources (MMMR). These relinquishments reduce the tenement holding to 15 exploration licences (previously 17) with an associated reduction in area from 2,386 square kilometres to 1,688 square kilometres. An updated tenement schedule is included in Appendix 1 and can be seen in Figure 3.

Exploration activities on the extensions to the eastern hematite targets progressed with reconnaissance mapping and pitting programs being completed during the quarter.

Mapping and pitting programs were completed on the northern leases to test extensions to the known mineralisation in the Kukuna district. Significant specular hematite schist was observed along strike on both the Kukuna North (EL18/2011) and Kukuna South (EL09/2012) licences adjacent to the main Kukuna (EL22/2012) mineralisation (refer Figure 3).

On the Kambia East licence (EL22/2011), a geological mapping and a soil sampling program were completed over a magnetic anomaly along a major regional structure (refer Figure 3). The anomaly is prospective for gold mineralisation and is coincident with recent illegal modern mechanised workings targeting gold mineralisation. The mapping was undertaken on 3 lines on a 400m x 50m grid. A total of 153 samples each weighing approximately 3kg were collected from depths varying from 50cm to 75cm. Samples have been sent for fire assay and results are awaited.

Mapping and pitting programs to test for southerly extensions to the known Kumrabai mineralisation on the Marampa East licence (20/2011) were similarly completed at the following prospects on the southern leases:

• Makumba and Matopi (Mawanka licence EL21/2011);

• Petifu (Gbahama licence EL11/2011);

• Bongoma (Gbangbama licence EL24/2011);

• Kumrabai South (Marampa East licence EL20/2011).

A total of 333 samples were forwared to SGS for iron analysis. Results are awaited.

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Exploration reports with recommendations for further work on these prospects are being compiled for review.

Cote D’Ivoire (100% interest)

Metals Exploration Cote D’Ivoire SA Limited is a wholly owned subsidiary of Cape Lambert Resources. The Company holds three tenements in the highly prospective Birimian Gold Belt of Cote D’Ivoire. The tenements are named Boundiali North (400km[2] ), Katiola (400km[2] ) and Bouake (400km[2] ) for a total land position of 1,200km[2 ] (refer Figure 4).

The tenements all contain, or are adjacent to, Birimian Greenstones and metasediments and have significant structural characteristics known to host high tenor gold mineralisation in the district. The Birimian Group is broadly divided into phyllites, tuffs and greywackes of the Lower Birimian (Type 2 metasediments), and various basaltic to andesitic lavas and volcanoclastics of the Upper Birimian (Type 1 Greenstone metavolcanics). Spatial distribution of gold mineralisation appears to be governed by north to northeast trending belts of metavolcanic rocks, ranging from 15 km to 40 km in width, associated with the Upper Birimian.

The Birimain Gold Belt is host to numerous multi-million ounce gold deposits including the Morila (7 Moz), Syama (7 Moz) and Tongon (4 Moz) deposits. Almost without exception, these major gold deposits are located at or close to the margins of the metavolcanic belts, adjacent to the strongly deformed contacts between the Upper and Lower Birimian sequences as seen to exist within the recently granted tenements.

All three tenements are highly prospective and have the potential to host multi-million ounce gold deposits (refer to ASX announcement of 30 April 2013).

Exploration

A regional mapping program was carried out by Perth based SRK Consultants over the 3 granted tenements and completed late during the quarter. The program was conducted to investigate promising interpreted structural features for hosting gold mineralisation identified from the airborne geophysical and radiometric survey completed during the previous quarter.

A total of 322 rock chip samples were collected during the mapping program and forwarded to SGS for gold analysis by fire assay and for ICP-MS multi-element analysis. Results are awaited.

The mapping report is expected during the next quarter.

Pinnacle (100% interest)

Pinnacle holds the Sandenia Iron Ore Project ( Sandenia or Sandenia Project ) located 290 km east of Conakry in the central south of the Republic of Guinea (Refer Fifure 2). The Project comprises a single tenement covering approximately 298 km[2] . The Sandenia permit contains Banded Iron Formation prospective for iron mineralisation, similar to that hosting the 6.16 Bt Kalia deposit owned by Bellzone Mining plc located on the contiguous permit to the north.

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The camp and facilities have been placed on care and maintenance and the Company is continuing to seek divestment opportunities for the project.

Mt Anketell Pty Ltd (100% interest)

Mt Anketell Pty Ltd ( Mt Anketell ), a wholly owned subsidiary of Cape Lambert, holds a single exploration licence (E47/1493) covering 56.9 km[2] in the northern Pilbara region of Western Australia, which is prospective for niche iron and gold mineralisation associated with the Nickol River precinct. Mt Anketell recently received a two year extension of the licence terms.

No exploration activities were conducted during the quarter.

The Company is currently in the process of divesting Mt Anketell.

Mining International Pty Ltd (100% Interest)

Mining International Pty Ltd (“Mining International”), is a fully owned subsidiary of Cape Lambert Resources Limited (ASX: CFE). The Company holds tenure to 4 mining leases (which were excluded from the sale of the Leichhardt Copper Project) and 3 granted exploration permits for minerals (EPM’s) (which were acquired from Caenues Minerals Limited in 2014) at the Wee MacGregor Project located 40 km southeast of Mt Isa in Queensland (refer Figure 5). One EPM application is pending grant. The total granted land package covers an area of approximately 89km[2] .

The tenements are located within in the Eastern Fold Belt of the Mt Isa inlier (Figure 5). The eastern-most tenements are located in the Mary Kathleen Zone/Wonga Subprovince. The western group of tenements are located in the Kalkadoon Leichhardt Belt. These areas are prospective for a variety of deposit types, most notably structurally controlled epigenetic copper and gold deposits.

The Wee MacGregor tenements can be classed as brownfields exploration as several copper occurrences and minor workings occur within the tenement boundaries. The largest of these are the Rosebud Mine within ML2773 which has recorded historical production of 20,000t or ore at 7.0% Cu. In addition, there are numerous under-explored geochemical and geophysical anomalies defined by previous explorers.

Cape Lambert is presently in discussion with prospective investors for the divestment of this project.

Competent Person:

The information in this report that relates to Exploration Targets and Exploration Results is based on information compiled by Dennis Kruger, who is an independent consultant from Durban Investments Pty Ltd. Mr Kruger is a Member of The Australian Institiute of Mining and Metallurgy and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Kruger consents to the inclusion in the report of the matters based on his information in the form and context in which appears. Mr Kruger has disclosed to the reporting company the full nature of the relationship between himself and the company, including any issue that could be perceived by investors as a conflict of interest. He verifies that the Report is based on and fairly and accurately reflects in the form and context in which it appears, the information in supporting documentation relating to Exploration Targets and Exploration Results.

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Figure 1: Group Structure December 2014

(ASX: CFE)

Exploration Projects Investments in Listed Entities Marampa Iron Ore Project International Goldfields Limited (ASX: IGS) CFE - 100% 24.7% interest Sierra Leone Gold (Australia / Cote d'Ivoire / Brazil) Rokel Iron Ore Project Fe Limited (ASX: FEL) CFE - 100% 57.7% interest Sierra Leone Iron Ore, Gold, Nickel (Yilgarn, Australia) Kukuna Iron Ore Project Kupang Resources Limited (ASX: KPR) CFE 12.6% interest Sierra Leone Manganese (West Timor) Sandenia Iron Ore Project Latin Resources Limited (ASX: LRS) CFE - 100% 9.82% interest Guinea Iron Ore, Gold, Copper (Peru) Mt Anketell Iron Ore Project Cauldron Energy Limited (ASX: CXU) CFE - 100% 17.4% interest WA, Australia Uranium (Australia / Argentina) Wee McGregor Copper Project Global Strategic Metals Ltd / European CFE - 100% Lithium Ltd* Australia Lithium (Austria) Cote D'ivoire Gold Project CFE - 100% Cote D'Ivoire Gabon Iron Ore Project CFE - 20% Gabon

• Currently undergoing AIM listing

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Figure 2: Cape Lambert West African Iron Ore Interests

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Figure 3: Location Map of Rokel Prospects

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Figure 4: Cote D’IvoireTenements

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Figure 5: Wee MacGregor Project Location

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Table 1: Cote d’Ivoire rock chip sampling and Rokel Pit and Surface Sample JORC Information.

JORC Code, 2012 Edition – Table 1 Report

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

Criteria	JORC Code explanation	JORC Code explanation	Commentary	Commentary
Sampling		Nature and quality of sampling (eg cut channels, random chips, or specific specialised		Cut channels within 1m x 1m x 2/3m hand excavated pits
techniques		industry standard measurement tools appropriate to the minerals under investigation,		Random surface rock chip samples of 2kg – 3kg
		such as down hole gamma sondes, or handheld XRF instruments, etc). These		~2kg samples taken from vertical channels by lithology.
		examples should not be taken as limiting the broad meaning of sampling.		Samples sent to SGS operated lab in Lunsar for sample preparation and onto SGS
		Include reference to measures taken to ensure sample representivity and the		analytical lab in Ghana for XRF determination of iron ore content.
		appropriate calibration of any measurement tools or systems used.		Samples sent to SGS operated lab in Lunsar for sample preparation and onto SGS
		Aspects of the determination of mineralisation that are Material to the Public Report.		analytical lab in South Africa for ICP-MS multi-element determination.
		In cases where ‘industry standard’ work has been done this would be relatively simple		Samples sent to SGS operated lab in Lunsar for sample preparation and onto SGS
		(eg ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was		analytical lab in Burkino Faso for gold content determination by fire assay.
		pulverised to produce a 30 g charge for fire assay’). In other cases more explanation
		may be required, such as where there is coarse gold that has inherent sampling
		problems. Unusual commodities or mineralisation types (eg submarine nodules) may
		warrant disclosure of detailed information.
Drilling		Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger,		No drilling
techniques		Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of		Pit and random surface hand sampling.
		diamond tails, face-sampling bit or other type, whether core is oriented and if so, by
		_what method, etc). _
Drill sample		Method of recording and assessing core and chip sample recoveries and results		No drilling
recovery		assessed.		Samples recoverd manually by hand in approximately 2kg- 3kg.
		Measures taken to maximise sample recovery and ensure representative nature of the		Sample bias likely due to unconscious preferential sampling inevitable in pit and rock
		samples.		chip sampling.
		Whether a relationship exists between sample recovery and grade and whether sample		Bias minimised in pits with vertical channel samples across entire lithologies.
		bias may have occurred due topreferential loss/gain of fine/coarse material.
Logging		Whether core and chip samples have been geologically and geotechnically logged to a		Logging included a geological description of the rock type sampled
		level of detail to support appropriate Mineral Resource estimation, mining studies and		The logging is entirely qualitative.
		metallurgical studies.		100% of channel samples logged.
		Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc)
		photography.
		The total length andpercentage of the relevant intersections logged.
Sub-sampling		If core, whether cut or sawn and whether quarter, half or all core taken.		No sub samples taken
techniques and		If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or		No duplicate samples were taken at this preliminary stage of the project. The and
sample		dry.		sampling method is only indicative and not suitable for any resource definition work.
preparation		For all sample types, the nature, quality and appropriateness of the sample preparation		Sample preparation in accordance with SGS Laboratory PRP94 technique
		technique.
		Quality controlprocedures adopted for all sub-sampling stages to maximise

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Criteria	JORC Code explanation	JORC Code explanation	Commentary	Commentary
		representivity of samples.
		Measures taken to ensure that the sampling is representative of the in situ material
		collected, including for instance results for field duplicate/second-half sampling.
		Whether sample sizes are appropriate to thegrain size of the material being sampled.
Quality of assay		The nature, quality and appropriateness of the assaying and laboratory procedures		Assays prepared by SGS in Sierra Leone and analysed by SGS in Ghana by XRF for
data and		used and whether the technique is considered partial or total.		iron ore content.
laboratory tests		For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters		Assays prepared by SGS in Sierra Leone and analysed by SGS in Burkino Faso for
		used in determining the analysis including instrument make and model, reading times,		gold content by fire assay
		calibrations factors applied and their derivation, etc.		Assays prepared by SGS in Sierra Leone and analysed by SGS in South Africa for
		Nature of quality control procedures adopted (eg standards, blanks, duplicates,		ICP-MS multi-element analysis
		external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias)		Quality control procedures for the pit and rock chip assays were followed via internal
		and precision have been established.		SGS protocols.
Verification of		The verification of significant intersections by either independent or alternative		Lab repeats and lab standards used.
sampling and		company personnel.		Duplicates used.
assaying		The use of twinned holes.		No samples twinned.
		Documentation of primary data, data entry procedures, data verification, data storage		Primary assay data received from SGS labs in an excel spreadsheet and loaded into
		(physical and electronic) protocols.		the company Datashed database.
		Discuss any adjustment to assay data.
Location of data		Accuracy and quality of surveys used to locate drill holes (collar and down-hole		Sample locations have been recorded on a handheld GPS.
points		surveys), trenches, mine workings and other locations used in Mineral Resource
		estimation.
		Specification of the grid system used.
		Quality and adequacy of topographic control.
Data spacing and		Data spacing for reporting of Exploration Results.		Random data spacing based on outcrop
distribution		Whether the data spacing and distribution is sufficient to establish the degree of
		geological and grade continuity appropriate for the Mineral Resource and Ore Reserve
		estimation procedure(s) and classifications applied.
		Whether sample compositing has been applied.
Orientation of		Whether the orientation of sampling achieves unbiased sampling of possible structures		Data based on outcrop occurrences.
data in relation to		and the extent to which this is known, considering the deposit type.		No particular sample orientation.
geological		If the relationship between the drilling orientation and the orientation of key mineralised
structure		structures is considered to have introduced a sampling bias, this should be assessed
		and reported if material.
Sample security		The measures taken to ensure sample security.		Chain of custody was managed by Cape Lambert Resources until samples were
				delivered to SGS Lunsar.
Audits or reviews		The results of any audits or reviews of sampling techniques and data.		Not applicable at this stage due to the preliminary nature of the project.

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Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria	JORC Code explanation	JORC Code explanation	Commentary	Commentary
Mineral tenement		Type, reference name/number, location and ownership including agreements or		All samples taken from the Rokel Project area held 100% by Metals Exploration
and land tenure		material issues with third parties such as joint ventures, partnerships, overriding		(Mauritius) Limited which is a wholly owned subsidiary of Cape Lambert Resources.
status		royalties, native title interests, historical sites, wilderness or national park and environmental settings. The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	 	All samples taken from the Cote d’Ivoire tenements are held 100% by Metals Exploration Cote d’Ivoire S.A, a wholly owned sunsidiary of Cape Lambert Resources. The tenements are in good standing.
Exploration done		Acknowledgment and appraisal of exploration by other parties.		Unknown
by other parties
Geology		Deposit type, geological setting and style of mineralisation.		Rokel Project area - Specularite schist bearing units with the Marampa Group Rocks
				Cote d’Ivoire projects – Greenstones and metasediments of the Birimian Group
				prospective for hosting gold deposits
Drill hole		A summary of all information material to the understanding of the exploration results		No drilling or assay results from drilling.
Information		including a tabulation of the following information for all Material drill holes:
		o easting and northing of the drill hole collar
		o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill
		hole collar
		o dip and azimuth of the hole
		o down hole length and interception depth
		o hole length.
		If the exclusion of this information is justified on the basis that the information is not
		Material and this exclusion does not detract from the understanding of the report, the
		Competent Person should clearly explain why this is the case.
Data aggregation		In reporting Exploration Results, weighting averaging techniques, maximum and/or		Assays were for a single samples over the full depth of each lithological layer within pits
methods		minimum grade truncations (eg cutting of high grades) and cut-off grades are usually		or as individual rock chips from surface samples.
		Material and should be stated.		No significant assays were returned during the reporting period.
		Where aggregate intercepts incorporate short lengths of high grade results and longer
		lengths of low grade results, the procedure used for such aggregation should be stated
		and some typical examples of such aggregations should be shown in detail.
		The assumptions used for any reporting of metal equivalent values should be clearly
		stated.
Relationship		These relationships are particularly important in the reporting of Exploration Results.		All samples taken vertically in pits confined to lithological units.
between		If the geometry of the mineralisation with respect to the drill hole angle is known, its		Specularite schist mineralisation has a general strike around due north depending on
mineralisation		nature should be reported.		the location along the eastern thrust fault sampled. Mineralisation is generally steeply
widths and intercept lengths		If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not known’).		dipping to the east.

Cape Lambert Resources Limited December 2014 Quarterly Report

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ASX Announcement Quarterly Report Period Ended 31 December 2014

September September

Criteria	JORC Code explanation	JORC Code explanation	Commentary	Commentary
Diagrams		Appropriate maps and sections (with scales) and tabulations of intercepts should be		See Figures ?and ? attached
		included for any significant discovery being reported These should include, but not be
		limited to aplan view of drill hole collar locations and appropriate sectional views.
Balanced		Where comprehensive reporting of all Exploration Results is not practicable,		All results have been reported
reporting		representative reporting of both low and high grades and/or widths should be practiced
		to avoid misleading reporting of Exploration Results.
Other substantive		Other exploration data, if meaningful and material, should be reported including (but not		Significant aeromag data as well as pit and trench data north and south along strike of
exploration data		limited to): geological observations; geophysical survey results; geochemical survey		the areas sampled.
		results; bulk samples – size and method of treatment; metallurgical test results; bulk
		density, groundwater, geotechnical and rock characteristics; potential deleterious or
		contaminating substances.
Further work		The nature and scale of planned further work (eg tests for lateral extensions or depth		Continued reconnaissance mapping and sampling will be followed up by drilling (RAB
		extensions or large-scale step-out drilling).		and RC) in due course
		Diagrams clearly highlighting the areas of possible extensions, including the main
		geological interpretations and future drilling areas, provided this information is not
		commercially sensitive.

Cape Lambert Resources Limited December 2014 Quarterly Report

Page 18 of 19

September

Appendix 1: Tenement Status

==> picture [440 x 492] intentionally omitted <==

Cape Lambert Resources Limited December 2014 Quarterly Report

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Rule 5.5

Appendix 5B

Mining exploration entity and oil and gas 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, 01/05/2013

Name of entity

Cape Lambert Resources Limited

ABN 71 095 047 920

Quarter ended (“current quarter”) 31 December 2014

Consolidated statement of cash flows

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) NetOperating Cash Flows	Current quarter $A’000	Year to date (6 months) $A’000
	- (4,189) - - (1,824) - 618 - - 18	- (8,782) - - (5,288) - 804 - (2,465) 115
	(5,377)	(15,616)
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 (d) controlled entity 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other: Royalty acquisition Other: Payment for subscription to convertible notes Other: Cash backing security for performance / other bonds & bank guarantees paid Other: Payment of transaction related and business development costs Net investing cash flows	- (350) (80) - - - - (9,685) 325 (13,766) - - (9)	- (589) (132) 51,504 49 - - (9,885) 650 (13,766) (250) (13) (2,432)
	(23,565)	25,136
1.13 Total operating and investing cash flows	(28,942)	9,520
Cash flows related to financing activities

• See chapter 19 for defined terms.

01/05/2013 Appendix 5B Page 1

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

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: On-market buy back Net financing cash flows	- - - - (12,534) -	- - - - (12,534) (900)
	(12,534)	(13,434)
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 ofquarter	(41,476) 58,107 49	(3,914) 20,491 103
	16,680	16,680

Payments to directors of the entity, associates of the directors, 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
		202
		-
1.25	Explanation necessaryfor an understandingof the transactions
	$202,000 (excluding GST) payment of executive and non-executive director fees.

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

N/A

• 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 N/A

• See chapter 19 for defined terms.

Appendix 5B Page 2

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Financing facilities available

Add notes as necessary for an understanding of the position.

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

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	3,100
	-
	-
	1,300
Total	4,400

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 Bank overdraft 5.4 Other (provide details)	1,680	3,107
	15,000	55,000
	-	-
	-	-
Total: cash at end of quarter(item 1.22)	16,680	58,107

• See chapter 19 for defined terms.

01/05/2013 Appendix 5B Page 3

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Changes in interests in mining tenements and petroleum tenements

6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements and petroleum tenements acquired or increased	Tenement reference and location	Nature of interest (note(2))	Interest at beginning ofquarter	Interest at end of quarter
	EPM17904	Surrendered	100%	-

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) (cents)	Amount paid up per security (see note 3) (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	626,686,586	626,686,586
	- -	- -
7.5 +Convertible debt securities (description)	-	-

• See chapter 19 for defined terms.

Appendix 5B Page 4

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

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	500,000 3,300,000	500,000 3,300,000	Exercise price $0.15 $0.088	Expiry date 30 Sept 2015 18 Dec 2016
	3,300,000	3,300,000	$0.088	18 Dec 2016
	-	-
	-	-
7.11 Debentures (totals only)	-	-
7.12 Unsecured notes(totals only)	-	-

• See chapter 19 for defined terms.

01/05/2013 Appendix 5B Page 5

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

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 /does not* (delete one) give a true and fair view of the matters disclosed.

Sign here: ...........................................

Date: 23 January 2015

(Company secretary)

Print name:

Melissa Chapman

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 and petroleum 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 or petroleum 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.

== == == == ==

• See chapter 19 for defined terms.

Appendix 5B Page 6

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