RED MOUNTAIN MINING LIMITED — Capital/Financing Update 2014

Sep 1, 2014

DRILLING COMMENCED TESTING HIGH-GRADE TARGET AT LOBO

• High grade silver-copper surface results to be tested down plunge at Camo target
• Drilling to target near surface silver-copper resource potential and deeper high grade gold target

Perth based Red Mountain Mining Limited has commenced drilling at Camo, one of five new priority drilling targets (see release of 5th August 2014 and Figure 5) within its Lobo Prospect on the Batangas Gold Project, located 120 kilometres south of Manila in the Philippines.

Drilling will test down plunge from high grade silver-copper, with gold, surface results at Camo, including previously released rockchip sample and trenching results of:

• 729 g/t silver (Ag), 1.45 g/t gold (Au) and 4.4% Copper (Cu) (released pre-2012) and
• 487 g/t Ag, 1.45 g/t Au and 1.09% Cu (released pre-2012) and
• Tr C1-14: 4m @ 379 g/t Ag, 2.0 g/t Au, 0.62% Cu, or 7.1 g/t Au equivalent1 (released 25 August 2014)

The objectives of the initial five diamond drillhole program are two fold:

• i) Define the strike extremities of the near surface high-grade silver, copper and gold siliceous lode and
• ii) to trace the down-plunge projection of the lode into the potential high grade gold or "boiling" zone.

Red Mountain Mining Managing Director Mr Jon Dugdale said: "Over the past few months, while the rigs haven't been turning, our in country team has been working hard to identify and define five new priority target areas for drilling at Lobo - and Camo is the first cab off the rank."

"The surface results at Camo indicate we are on top of a preserved epithermal system with high grade silver (with copper and gold) at surface and the potential for a "look-alike" to the high grade South West Breccia gold zone at shallow depth."

"Drilling will initially target the shallow silver-copper-gold target, then test for a high grade gold zone below."

The location of all current and previous results and proposed drillholes are shown on Figure 1 (plan) and Figure 2 (longitudinal projection) below.

1Note: The gold equivalence calculation represents total metal value for each metal summed and expressed in equivalent gold grade in grams per tonne (g/t). The prices used in the calculation being A$1400/oz Au, A$21.50/oz Ag and A$3.20/lb Cu. Metallurgical recovery to concentrate of 90.0% for gold, 92.0% for silver and 92.0% for copper as indicated by publically available metallurgical testwork on an identical epithermal ore assemblage at Mt Carlton in Queensland, Australia.

Calculation Au Eq = ((((Grade Au g/t / 31.1035) x Price Au per Oz x Au Recovery) + ((Grade Ag g/t / 31.1035) x Price Ag per Oz x Ag recovery) + ((Grade Cu %/100) x (Price Cu per lb x 2204.6) x (Cu Recovery))) / (Price Au per Oz))) x 31.1035. It is the Company's opinion that all the elements included in the metal equivalents calculation have a reasonable potential to be recovered and sold.

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Figure 1: Plan of Camo lode with location of longitudinal projection and Silver in soil anomalies

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Figure 2: Longitudinal projection of Camo target

About the Camo Target:

The Camo target is located approximately 1.2 kilometres along strike northeast of the high grade South West Breccia (SWB) resource, and is associated with an identical flexure or bend in the structure to SWB (See plan, Figure 3). Camo is also at a 100m higher elevation than SWB, and characterised by high silver and copper grades in layered quartz-barite-enargite (Cu-As sulphide) epithermal lode material, indicative of the siliceous cap or sinter zone formed within the upper levels of an epithermal system.

High grade gold generally occurs below the silver rich siliceous sinter, within the "boiling zone" of the epithermal system. This is interpreted to have been eroded at SWB but may lie at shallow depth at Camo (See longitudinal Figure 4). This interpretation is backed up by the observation that at West Drift, 1 kilometre north of Camo, a gold resource (released 30 June 2014) is located less than 100m below the previously mined silver-copper rich siliceous zone.

The Camo lode therefore represents a significant target to define a near surface silver-copper and gold resource, with potential for a high grade gold zone at depth.

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Figure 3: Plan of SWB and Camo lodes, Lobo epithermal gold prospect, Batangas project

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Figure 4: Longitudinal projection of SWB and Camo structures

About the Lobo Prospect

Surface trench channel sampling and drilling conducted by Red Mountain has intersected high-grade epithermal gold mineralisation in five areas on the Lobo Mineral Production Sharing Agreement ("MPSA" – Philippines equivalent to a Mining Lease), namely SWB, Pica, Japanese Tunnel, West Drift and Ulupong.

Mineral Resources totaling 604,000t @ 4.2 g/t Au for 82,000 ounces of gold have been defined in three areas at Lobo, including SWB with a total 98% Indicated and 2% Inferred Resource of 221,000t @ 6.3 g/t Au, Japanese Tunnel with a total Indicated and Inferred Resource of 34,000t @ 3.0 g/t Au and West Drift with a total Indicated and Inferred Resource of 350,000t @ 3.0 g/t Au (ASX release 30 June 2014, JORC 2012).

The Company is focussed on increasing high grade resources through discovery of new, high grade, gold zones at Lobo. Five priority targets have been identified on the Lobo prospect area, for high grade gold as well as silvergold-copper mineralisation at the top of the preserved epithermal systems (see Figure 5).

Sampling of the new target areas continues, with the objective of defining multiple targets for a drilling program to commence shortly.

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Figure 5: Plan of Lobo epithermal gold prospect with resources and high priority targets

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

Company Investors Media Jon Dugdale Matt Birney Managing Director Birney Corporate (+61) 402 298 026 (+61) 419 217 090 (+61) 8 9226 5668 (+61)8 9226 5668

E: jon.dugdale@redmm.com.au E: matt@birneycorporate.com.au

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About Red Mountain Mining Limited and the Batangas Gold Project

Red Mountain Mining (ASX: RMX) is primarily a gold explorer/developer and project acquisition company which listed on the ASX in September 2011. The Company's strategy is to unlock the potential of 'under-developed' gold and polymetallic projects in the greater Asian region by introducing Australian exploration and mining methods and improving efficiencies to gain significant exploration and production upside.

The Company holds a 100% direct and indirect contractual right interest in tenements in the Philippines that contain significant gold resources. Total Mineral Resources at Batangas include Indicated Resources of 2.97 million tonnes @ 2.4 g/t Au, 227,000 oz Au and Inferred Resources of 3.22 million tonnes @ 2.1 g/t Au, 218,000oz Au for a total of 6.19 million tonnes at 2.2 g/t Au, 444,000oz Au (ASX announcement 30 June 2014, JORC 2012).

The Company will continue exploration with the objectives of upgrading Mineral Resources at Batangas.

A Scoping Study (ASX release 20 March 2014) has demonstrated a strongly viable, low capital and operating cost, gold development based on initially recovering 90,000oz of gold over 4.5 years and potentially generating A$57 million of cash flow, including A$17m of pre-production capital (US$ 1,350/oz; A$:US$ exchange 0.9).

The Company is completing a Definitive Feasibility Study (DFS) on the project and final permitting submissions have been lodged with the Philippines Government for approval to develop the Batangas Project, gold mining and processing operation (ASX release 30 April 2014).

Other gold opportunities will be reviewed on a continuous basis.

Cautionary Statement

The Scoping Study referred to in this announcement is based on lower-level technical and economic assessments, and is insufficient to support estimation of Ore Reserves or to provide assurance of an economic development case at this stage, or to provide certainty that the conclusions of the Scoping Study will be realised. There is a low level of geological confidence associated with inferred mineral resources (that represent 10% of the mining inventory in the Scoping Study) and there is no certainly that further exploration work will result in the determination of indicated Mineral Resources or that the production target itself will be realised. There is no certainty that the Scoping Study production targets or the forecast financial information derived from production targets, will be realised. All material assumptions underpinning the production targets and forecast financial information derived from the production targets, full details of which were released to ASX on 20 March 2014, continue to apply and have not materially changed.

Competent Person Statement

The information in this report relating to Mineral Resources and post 1 December 2013 Exploration Results is based on information compiled by Mr Jon Dugdale who is a Fellow of the Australasian Institute of Mining and Metallurgy and has sufficient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as defined in 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Dugdale is a full time employee and Managing Director of Red Mountain Mining Ltd. The Company confirms that the form and context in which the information is presented has not been materially modified and it is not aware of any new information or data that materially affects the information included in the relevant market announcements, as detailed in the body of this announcement. All material assumptions and technical parameters underpinning the Mineral Resource estimates continue to apply and have not materially changed.

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The information in this report relating to pre December 2013 Exploration Results is based on information compiled by Mr Jon Dugdale who is a Fellow of the Australasian Institute of Mining and Metallurgy and has sufficient exploration experience which is relevant to the various styles of mineralisation under consideration 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'. Mr Dugdale is a full time employee and Managing Director of Red Mountain Mining Ltd. Mr Dugdale takes responsibility and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Forward Looking Statements

This announcement contains certain forward looking statements. These forward-looking statements are not historical facts but rather are based on Red Mountain Mining's current expectations, estimates and projections about the industry in which Red Mountain Mining operates, and beliefs and assumptions regarding Red Mountain Mining's future performance. Words such as "anticipates", "expects", "intends", "plans", "believes", "seeks", "estimates" "potential" and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the control of Red Mountain Mining, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Red Mountain Mining cautions shareholders and prospective shareholders not to place undue reliance on these forwardlooking statements, which reflect the view of Red Mountain Mining only as of the date of this presentation. The forward-looking statements made in this release relate only to events as of the date on which the statements are made. Red Mountain Mining will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances or unanticipated events occurring after the date of this presentation except as required by law or by any appropriate regulatory authority.

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