MCS SERVICES LIMITED — Capital/Financing Update 2012

Apr 15, 2012

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ASX: RGX

16 April 2012

Quickening the Pace at La Negra

Red Gum Resources Limited (“Red Gum” or “the “Company”) is pleased to update the market on the progress of its ongoing drilling program at the La Negra Project, which is host to an emerging polymetallic discovery, as reported previously (see ASX 22[nd] March, 2012).

HIGHLIGHTS

• All drill holes to date have encountered visual base metal sulphide mineralisation across broad intervals

• Assay results for holes RDN-002 and RDN-003 expected shortly, the balance to RDN-006 delivered to lab and pending processing

• New drilling company contracted and larger, truck mounted drill rig has been mobilized to site

• New rig will maximise efficiency of the remainder of the program, and potentially any extension to Phase 1 subject to results expected over the coming months

Red Gum has contracted the services of H.S.B. Sondajes, a local Chilean drilling contractor, to complete the remaining 2,000 metres of the Phase 1 diamond drilling program at La Negra. A near-new truck mounted Explorer 1500D diamond rig is currently being mobilised to site and is ideally suited to completing the program. The Company believes that the Explorer 1500D will deliver both a high penetration rate and has the capacity to drill deeper in this critical second half of the Phase 1 drilling program, which includes a mínimum of two deeper holes of 500 metres,.

Managing Director Paul Pearson commented , "We are eagerly awaiting assay results as visual results have continued to be very encouraging, in particular some very broad visual mineralisation encountered in some recent holes. Subject to the continuation of positive assay results, the Board is looking forward to making a formal decision on extending the current program".

*ENDS***

For Further information please contact:

Paul Pearson, Managing Director + 61 8 8212 5724 Victoria Thomas, Six Degrees Investor Relations +61 3 9674 0347

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About La Negra Project

The La Negra Lead-Zinc-Silver (Copper-Gold) Project is located within Region IV in Chile, approximately 360 kilometres NNE of the capital, Santiago and approximately 10 kilometres ENE of the mining town of Combarbalá. Red Gum has an option to acquire 100% in the property, which comprises 11 separate mining and exploration concessions totaling approximately 2,600 hectares.

The La Negra property has a long history, dating back to colonial times, of sourcing high grade lead-zinc-silver material. Modern day geochemical sampling verified the surface and subsurface continuity of high metal grades (zinc, lead, silver, copper, gold) over significant widths within the old workings.

Previous surface geochemistry defined a strong northerly trending (“principal”) zinc-lead anomaly, 1200 metre long x 400 metre wide, broadly corresponding with outcropping tourmaline-bearing hydrothermal breccias that host the old workings. Strong silver, copper and gold values are concentrated in the soils of the northern segment of this principal anomaly. These, and other geochemical anomalies, are underlain by large chargeability anomalies defined in the geophysics.

Competent Persons Statement

The information in this document that relates to Exploration Targets is based on information compiled by Dr Paul Pearson, who is Fellow of The Australasian Institute of Mining and Metallurgy. Dr Pearson is the Managing Director of Red Gum Resources Limited.

Dr Pearson has sufficient experience which 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’. Dr Pearson consents to the inclusion in this document of the matters based on his information in the form and context in which it appears and verifies that it is based on and fairly and accurately reflects in the form and context in which it appears, the information in my supporting documentation relating to Exploration Results, Mineral Resources and/or Ore Reserves.