RED MOUNTAIN MINING LIMITED — Capital/Financing Update 2011

Sep 28, 2011

ASX ANNOUNCEMENT

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Stage II drilling to commence at Zhongqu

Date: 29 September 2011

Highlights

• Stage II drill program to commence immediately at Zhongqu following successful Stage 1 results.

• Drilling to target main granodiorite mineralised zone and newly encountered hanging wall mineralisation. Previous best intersections include:

  • 31 m at 4.61 grams per tonne gold, including 4 m at 9.51 g/t gold and 8m at 10.07 g/t gold;

  • 14.3m at 4.50 g/t gold, including 6m at 7.14 g/t gold and 3m at 6.27 g/t gold;

  • 8m at 7.65 g/t gold;9m @ 5.59g/t gold;7m @ 5.70g/t gold and 4.5m @ 6.33g/t gold

• Initial results anticipated in 6­8 weeks.

China focussed gold exploration company, Red Mountain Mining Limited (“Red Mountain Mining” or “the Company”, ASX: RMX) has confirmed that a Stage II underground drilling program at the Zhongqu project will commence immediately following the encouraging results obtained in the Stage I drilling announced to the ASX on 15 eptember, 2011. S

Stage I drilling intersected the main granodiorite‐contact shear zone with a best intersection of 31m at 4.61 g/t gold including 8m at 10.07 g/t gold, as well as previously unrecognised limestone‐hosted gold mineralised structures (up to 14.3m at 4.50 g/t gold).

Red Mountain Mining CEO, Mr Andrew Richards, said that these highly encouraging results are located below the current operating mine and justify continued investigation of the gold mineralisation.

“As well as the expected main shear zone which hosts the historically mined mineralisation, we’ve also intersected a previously unknown zone of limestone hosted mineralisation in the hanging wall. This has positive implications for the amount of mineralisation we may be able to bring into a JORC compliant resource,” said Mr Richards.

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Stage II drilling will target both these styles of gold mineralisation with up to 15 drill holes totalling approximately 2430m. Provision has been made to follow up encouraging drill intercepts during the program with additional holes.

The drilling aims to establish the down dip extension of the main granodiorite‐contact shear zone and get a better understanding of the orientation and tonnage potential of the high‐grade gold hematitic limestone structures.

Site preparation and mobilisation of the drilling team has commenced. The Company already has one rig on site and is investigating the possibility of obtaining a second rig to fast track the program.

Initial drill results from this program are anticipated in approximately 6‐8 weeks time.

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Figure 1: CEO Andrew Richards and mine geology team at Zhongqu

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----- Start of picture text ----- Figure 2: Hole 10, Granodiorite contact zonemineralisation (part of an intersectionassaying 8m at 7.65/t gold).----- End of picture text -----

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Figure 3: Hole 5, Limestone hosted structure (7m at 5.70 g/t gold)

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For further information about Red Mountain Mining please visit www.redmm.com.au or contact:

Company Media Investors Andrew Richards Shane Murphy Ronn Bechler Chief Executive Officer FTI Consulting Market Eye (+61) 423044879 (+61) 420 945 291 (+61) 400 009 774 (+61 8) 9226 5668 (+61 8) 9386 1233 (+61 3) 9591 8901

About Red Mountain Mining

Red Mountain Mining is a newly listed gold exploration company with two projects in China. The Company’s strategy is to unlock the potential of ‘under‐developed’ gold projects in China by introducing Australian mining methods and improving efficiencies to gain significant production and exploration upside.

The Company has binding acquisition agreements to acquire 51% of the Zhongqu project (operating gold mine and infrastructure) and 90% of the Diebu project .

The Zhongqu Project is an operational gold mine with substantial exploration potential. The Project has been operational since 2005 using labour intensive manual mining methods and has a modern gold treatment plant with400,000 tpa capacity.

Zhongqu has a Chinese classified non‐JORC compliant gold resource. Please refer to Red Mountain's prospectus of 4 July 2011. A further Exploration Target estimate exists with an estimated range of 400,000 to 550,000 tonnes at 7.0 to 9.5 g/t of goldi. Red Mountain is conducting a drilling program to bring the gold resources into JORC compliance.

The Diebu Project has an exploration target of between 400,000 to 550,000 tonnes at 3.5 to 4.5 g/t of gold. The Company obtained encouraging results from its first comprehensive examination of Diebu in 2008. Mineralisation occurs irregularly over 6kms but has not yet been adequately explored and in particular, has not been drilled.

The mine openings (adits) have been developed following the common Chinese approach to “explore by mining”. Openings have been driven to intersect and follow the perceived main structures without consideration being given to adjacent potential replacement gold mineralisation. The system has gold, arsenic, antimony and mercury anomalism.

Red Mountain Mining was incorporated in Australia in May 2006 and was listed on the ASX in September 2011. It has spent more than five years examining potential project acquisitions in China.

Competent Persons Statement

The information in this report that relates to Exploration Results or Mineral Resources is based on information compiled by Andrew Richards, who is a member of The Australasian Institute of Mining and Metallurgy. He is a full time employee of Arc Resources Pty Ltd which is providing consulting services to Red Mountain Resources Ltd.

Andrew Richards 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

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Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Andrew Richards consents to the inclusion in the report of the matters based on their information in the form and context in which it appears.

iThe potential quantity and grade of the Exploration Targets are conceptual in nature and there has been insufficient exploration to define a Mineral Resource. It is uncertain if further exploration will result in the determination of a Mineral Resource.

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