RED METAL LIMITED — Capital/Financing Update 2012

Jan 4, 2012

ACN 103 367 684

ASX Release 5 January, 2012

ASX Code: RDM

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Issued Capital:

112,115,885 Ordinary shares

5,125,000 Unlisted options

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Directors:

Rob Rutherford Managing Director

Russell Barwick Chairman

Joshua Pitt Non-executive Director

Drilling Activities Resume on the Maronan Silver-Lead Project, Northwest Queensland

Drilling contractors have resumed activities on the Maronan project following the Christmas break.

The current two hole, 1000 metre, drill core program at Maronan is designed to test the continuity of the high grade silver-lead mineralisation in the Lower BIF and Upper BIF horizons as well as shallow mineralisation that has the potential to be extracted by open pit mining (Figure 2).

A new geological model for the Maronan deposit predicts a plunge to the mineralisation that differs from earlier interpretations and has opened up the potential to define significant resources.

Red Metal has been awarded $150,000 under the Queensland Government Greenfields 2020 – Collaborative Drilling Initiative to assist the drill testing of this exciting new geological model. The current drilling is expected to be completed in about two weeks with assay results to follow in February.

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RED METAL LIMITED

Level 15 323 Castlereagh Street Sydney NSW 2000

Ph: +61 2 9281 1805 Fax: +61 2 9281 5747 info@redmetal.com.au www.redmetal.com.au

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[Figure 1] Project Location

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----- Start of picture text ----- Open Pit TargetHigh-grade Target----- End of picture text -----

[Figure 2] Maronan Project: Longitudinal section viewed facing east for the lower banded iron formation (BIF) horizon showing drill hole positions coloured by the silver (g/t) to lead (%) ratio, intercept true thickness contours (metres) and potential exploration target polygons coloured by lead equivalent value. Note steep northerly plunge to the mineralised zone, the increasing silver to lead ratio at depth, and planned drill hole intercept locations (white/red stars).

For further information concerning Red Metal’s operations and plans for the future please refer to the recently updated web site or contact Rob Rutherford, Managing Director at:

Phone +61 (0)2 9281-1805 Fax +61 (0)2 9281-5747 www.redmetal.com.au

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----- Start of picture text ----- Rob Rutherford Russell BarwickManaging Director Chairman----- End of picture text -----

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The information in this report that relates to Exploration Results is based on information compiled by Mr Robert Rutherford, who is a member of the Australian Institute of Geoscientists (AIG). Mr Rutherford is the Managing Director of the Company. Mr Rutherford has sufficient experience which is relevant to the style of mineralization 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” (the JORC Code). Mr Rutherford consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this report that relates to Exploration Target modelling is based on work done by Mr Simon Gatehouse, who is a member of the Australian Institute of Geoscientists (AIG). Mr Gatehouse is a full time employee of Hellman & Schofield Pty Ltd. Mr Gatehouse has sufficient experience which is relevant to the style of mineralization 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” (the JORC Code). Mr Gatehouse consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.