PRAIRIE LITHIUM LIMITED — Interim / Quarterly Report 2012

Jul 31, 2012

Rule 5.3

Appendix 5B

Mining 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

Name of entity
ZYL LIMITED

15 008 720 223 30 June 2012

ABN Quarter ended ("current quarter")

Consolidated statement of cash flows

		Current quarter	Year to date (9
Cash flows related to operating activities		$A'000	months)
			$A'000
1.1	Receipts from product sales and related	-	-
	debtors
1.2	Payments for(a) exploration & evaluation	(825)	(5,193)
	(b) development	-	-
	(c) production	-	-
	(d) administration	(2,133)	(4,094)
1.3	Dividends received	-	-
1.4	Interest and other items of a similar nature
	received	228	1,096
1.5	Interest and other costs of finance paid	-	-
1.6	Income taxes paid	-	-
1.7	Other (provide details if material)	93	(35)
	Net Operating Cash Flows	(2,637)	(8,226)
	Cash flows related to investing activities
1.8	Payment for purchases of:(a) prospects	-	-
	(b) equity investments	(16,249)	(19,919)
	(c) other fixed assets	(107)	(243)
1.9	Proceeds from sale of:(a) prospects	-	-
	(b) equity investments	-	-
	(c) other fixed assets	-	4
1.10	Loans to other entities	(1,321)	(1,321)
1.11	Loans repaid by other entities	-	-
1.12	Other (provide details if material)	-	-
		(17,677)	(21,479)
	Net investing cash flows
1.13	Total operating and investing cash flows(carried forward)	(20,314)	(29,705)

+ See chapter 19 for defined terms.

1.13	Total operating and investing cash flows(brought forward)	(20,314)	(29,705)
	Cash flows related to financing activities
1.14	Proceeds from issues of shares, options, etc.	-	-
1.15	Proceeds from sale of forfeited shares	-	-
1.16	Proceeds from borrowings	-	122
1.17	Repayment of borrowings	-	-
1.18	Dividends paid	-	-
1.19	Other (provide details if material)	-	(13)
	Net financing cash flows	-	109
	Net increase (decrease) in cash held	(20,314)	(29,596)
1.20	Cash at beginning of quarter/year to date	24,743	34,207
1.21	Exchange rate adjustments to item 1.20	96	(86)
1.22	Cash at end of quarter	4,525	4,525

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	808
1.24	Aggregate amount of loans to the parties included in item 1.10	-

1.25 Explanation necessary for an understanding of the transactions

Payments of Directors fees and salaries $435,525. Payments made to Hemisphere Corporate Services Pty Ltd for the provision of consultancy, administrative and tenancy related services of $372,347. Bevan Tarratt and Glenn Whiddon are both directors of ZYL Limited and shareholders of Hemisphere Corporate Services Pty Ltd.

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

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

+ See chapter 19 for defined terms.

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
3.2	Credit standby arrangements

Estimated cash outflows for next quarter

		$A'000
4.1	Exploration and evaluation	2,200
4.2	Development	100
4.3	Production	-
4.4	Administration	1,065
		3,365
	Total

Reconciliation of cash

	Reconciliation of cash at the end of the quarter (asshown 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	70	18
5.2	Deposits at call	4,396	21,549
5.3	Bank overdraft	-
5.4	Other (provide details)	59	-3,176
	Total: cash at end of quarter (item 1.22)	4,525	24,743

Changes in interests in mining tenements

		Tenementreference	Nature of interest(note (2))	Interest atbeginningof quarter	Interest atend ofquarter
6.1	Interests in miningtenementsrelinquished, reducedor lapsed

+ See chapter 19 for defined terms.

6.2 Interests in mining tenements acquired or increased

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	Amount paid up
				security (see	per security (see
				note 3) (cents)	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	492,007,899	492,007,899
	securities
7.4	Changes during	3,472,000	3,472,000	Nil(Shares	Fully paid
	quarter			issued pursuant
	(a) Increases			toKangwane
	through issues			SouthProject
	(b) Decreases			agreement)
	through returnsof capital, buy
	backs
7.5	+Convertible
	debt
	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 and	20,000,000	-	$0.20	18 April 2015
	conversion	1,500,000	-	$0.06	30 September 2012
	factor)	3,000,000	-	$0.10	30 September 2012
		2,500,000	-	$0.06	21 February 2013
7.8	Issued during
	quarter

+ See chapter 19 for defined terms.

7.9	Exercisedduring quarter
7.10	Expired duringquarter
7.11	Debentures(totals only)
7.12	Unsecurednotes (totalsonly)

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: 31 July 2012……....... (Company secretary)

Print name: ........Nicholas Ong...............

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 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.