PACIFIC RESOURCES LIMITED — Interim / Quarterly Report 2008

Jan 29, 2009

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

Name of entity

LODESTONE EXPLORATION LIMITED

ABN Quarter ended ("current quarter")

20 075 877 075 31 DECEMBER 2008

Consolidated statement of cash flows

Cash flows related to operating activities		Current quarter$A'000	Year to date(6 months)$A'000
1.1	Receipts from product sales and related debtors	-	-
1.2	Payments for (a) exploration and evaluation(b) development(c) production	(105)--	(160)--
	(d) administration	(231)	(475)
1.31.4	Dividends receivedInterest and other items of a similar naturereceived	-20	-33
1.5	Interest and other costs of finance paid	-	-
1.6	Income taxes paid	-	-
1.7	Other (provide details if material)	2	2
	Net Operating Cash Flows	(314)	(600)
1.8	Cash flows related to investing activitiesPayment for purchases of:(a)prospects(b)equity investments(c) other fixed assets	--(6)	--(6)
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 (provide details if material)Cash paid for security deposits	(15)	(15)
	Net investing cash flows	(21)	(21)
1.13	Totaloperatingandinvestingcashflows(carried forward)	(335)	(621)

+ See chapter 19 for defined terms.

1.13	Totaloperatingandinvestingcashflows(brought forward)	(335)	(621)
1.141.151.161.171.181.19	Cash flows related to financing activitiesProceeds from issues of shares, options, etc.Proceeds from sale of forfeited sharesProceeds from borrowingsRepayment of borrowingsDividends paidOther – Share issue costs	------	1,429----
	Net financing cash flows	-	1,429
	Net increase (decrease) in cash held	(335)	808
1.201.21	Cash at beginning of quarter/year to dateExchange rate adjustments to item 1.20	1,729-	586-
1.22	Cash at end of quarter	1,394	1,394

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

		Current quarter$A'000
1.23	Aggregate amount of payments to the parties included in item 1.2	76
1.24	Aggregate amount of loans to the parties included in item 1.10	Nil

1.25 Explanation necessary for an understanding of the transactions

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

During the quarter 3,000,000 fully paid ordinary shares were issued under a Farmin Agreement which was approved by shareholders on 9 September 2008. The shares are subject to a restriction agreement and are under a holding lock until 6 October 2009.

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.

		Amount available$A'000	Amount used$A'000
3.1	Loan facilities	Nil	Nil
3.2	Credit standby arrangements	Nil	Nil

Estimated cash outflows for next quarter

	Total	250
4.2	Development	-
4.1	Exploration and evaluation	250
		$A'000

Reconciliation of cash

Reconciliation of cash at the end of the quarter (asshown in the consolidated statement of cash flows) tothe related items in the accounts is as follows.		Current quarter$A'000	Previous quarter$A'000
5.1	Cash on hand and at bank	19	33
5.2	Deposits at call	1,375	1,696
5.3	Bank overdraft	-	-
5.4	Other (provide details)	-	-
	Total: cash at end of quarter (item 1.22)	1,394	1,729

Changes in interests in mining tenements

		Tenementreference	Nature of interest(note (2))	Interest atbeginningof quarter	Interest atend ofquarter
6.1	Interests in miningtenements relinquished,reduced or lapsed	KarinyaDistrictMt MorganDistrict	51%equityearnedinSedexMinerals Pty Ltd EL 3420Wholly-owned EPM's	267 sq kms118 sq kms	Nil88 sq kms
6.2	Interests in miningtenements acquired orincreased	N/A

+ See chapter 19 for defined terms.

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	Issuepricepersecurity (see note	Amount paid up persecurity (see note 3)
				3) (cents)	(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	175,409,529	175,409,529	Fully paid	Fully paid
	securities
7.4	Changes during
	quarter
	(a) Increases	3,000,000	-	2 cents	Fully paid
	through issues
	(b) Decreases
	through returns ofcapital, buy-backs
	(c) Increase
	through options
	exercised
7.5	+Convertible debt	N/A
	securities
	(description)
7.6	Changes during
	quarter(a) Increases
	through issues
	(b) Decreases
	through securities
	matured, converted
7.7	Options			Exercise price	Expiry date
	(description andconversion factor)	501,000	-	20 cents	27/01/11
		10,000,000	-	7 cents	10/08/10
7.8	Issued during
	quarter
7.9	Exercised during
	quarter
7.10	Expired during
	quarter
7.11	Debentures(totals only)	N/A
7.12	Unsecured notes	N/A
	(totals only)

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 4).
• 2 This statement does give a true and fair view of the matters disclosed.

Sign here: Date: 30 January 2009

Company Secretary

Print name: Leni Stanley

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 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.
• 5 Accounting Standards ASX will accept, for example, the use of International Accounting 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.