RED MOUNTAIN MINING LIMITED — Interim / Quarterly Report 2012

Apr 25, 2012

26 APRIL 2012

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ASX ANNOUNCEMENT

March Quarter 2012 Report

MARCH QUARTER 2012 OVERVIEW

• Red Mountain Mining Limited (ASX: RMX) completed the second stage of its 1,645 metre underground diamond drilling campaign at the Zhongqu Project that confirmed the presence of high grade gold mineralisation in a series of lenses at the Xinqu underground mine.

• A preliminary Inferred JORC compliant resource for Ore Body #3 at the Xingqu mine (Zhongqu project) of 390,600 tonnes grading 4.44 g/t Au and containing 55,750 ounces Au was defined by Red Mountain Mining above a reporting grade of 1g/t.

• Red Mountain Mining negotiated an extension to the Zhongqu Framework Agreement to 31 July 2012 at no additional cost. However, as announced subsequent to the quarter end, the Company elected to withdraw from this agreement due to lower than anticipated gold resources and uncertainty over the extension amendment deed.

• A number of Board and management changes were instituted including the appointment of Mr Neil Warburton as Executive Chairman and Acting CEO.

• Red Mountain Mining remained in a strong financial position with $5.1 million in cash and no debt as at 31 March 2012.

• After completing a review of the Diebu Project from a technical and commercial perspective, Red Mountain Mining elected to withdraw from the Diebu Framework Agreement.

• The Company is advancing negotiations on several other projects within China and has extended its search for project acquisitions to the greater Asian region whilst maintaining its strategic focus of introducing modern Australian mining techniques to underdeveloped projects in the region.

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ASX code: RMX ABN 40 119568106

COMPANY DIRECTORS Neil Warburton Executive Chairman & Acting CEO Keith Rowe Executive Director

CONTACT DETAILS RED MOUNTAIN MINING LTD Head Office Unit 1, 2 Richardson Street West Perth Western Australia 6005 www.redmm.com.au info@redmm.com.au

Michael Wolley Non-Executive Director

Shannon Coates Company Secretary

ZHONGQU PROJECT, GANSU - STATUS

The Zhongqu Project was subject to a specific Framework Agreement whereby Red Mountain Mining could acquire a 51% equity interest in the operating gold mine.

During the March quarter, the Company completed the second stage of confirmatory drilling as part of the exploration program to assess the resource potential prior to exercising its option under the Zhongqu Framework Agreement. The Stage II drilling results are detailed in the Zhongqu Exploration Review section below.

In summary, the drilling results from Stage I and Stage II underground exploration confirmed the existence of high grade gold lenses within the main target zones at the Xinqu underground mine. The high grade lenses could be commercially enhanced Figure 1. Red Mountain Mining projects using an alternative mining method to that currently employed within the mine but additional drilling would be required to upgrade the current inferred JORC resource category.

A preliminary Inferred mineral resource in accordance with the JORC Code guidelines was estimated for Ore Body #3 based on the Stage I and II drill results. This resource is summarised in the Resource Review section below and totals 390,600 tonnes grading 4.44 g/t Au (55,750 ounces Au) above a reporting grade of 1.0 g/t Au.

Since listing, the Company has concentrated exploration efforts at the Xinqu underground area of the Zhongqu Project. No work has been undertaken at the Xiaruo or Zhongqu deposits within the Zhongqu Project where additional mineralisation exists as described in the Company’s August 2011 prospectus.

While there is potential for the Xiaruo and Zhongqu areas to provide resource upside, Red Mountain Mining considers there is insufficient resource potential at Xinqu alone to justify the original purchase price under the original Framework Agreement.

Consequently the Company withdrew from this agreement on 23 April 2012.

Zhongqu Exploration Review

As reported to the ASX during the March quarter, drilling by the Company at the Xingqu mine returned a number of high grade results but also showed the mineralisation to be less continuous than previously indicated (Table 1, Figure 2). This confirmed the view, reached after detailed structural mapping by the Company, that gold mineralisation existed as a series of high grade lenses controlled by north east and north west oriented structures.

Michael Wolley Non-Executive Director

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ASX code: RMX ABN 40 119568106

COMPANY DIRECTORS Neil Warburton Executive Chairman & Acting CEO Keith Rowe Executive Director

CONTACT DETAILS RED MOUNTAIN MINING LTD Head Office Unit 1, 2 Richardson Street West Perth Western Australia 6005 www.redmm.com.au info@redmm.com.au

Shannon Coates Company Secretary

Preliminary modelling of the underground drill intercepts suggests that the Xinqu deposit at the Zhongqu Project is likely to comprise a lesser resource to a vertical depth of 150 metres below the current workings than was originally estimated based on mined areas above the 6 level (lowest current workings). It is highly possible that additional lenses or other adjacent ore bodies might be encountered with further exploratory drilling around this target area.

Table 1 below summarises the significant drill intercepts:

Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts

Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts	Table 1: Zhongqu Stage II drilling - Summary of significant drill intercepts
		From (m)		Interval (m)			Interval (m)
Hole	Target		To (m)		Au (g/t)			Au (g/t)
ZQ6L018	OB#3	128	130	2.00	1.92
ZQ6L019	OB#3	110	113	3.00	4.33	including	1.00	12.05
ZQ6L020	OB#3	163.0	171.75	8.75	4.62	including	2.10 0.55	7.99 15.10
ZQ6L021	OB#3	26.00 52.25	31.40 57.40	2.48 2.20	1.87 7.16	including	1.70	8.13
ZQ6L022	OB#1	76.6	83.9	7.30	16.01	including	3.00	28.11
ZQ6L023	OB#1			NSI	NSI
ZQ6L024	OB#3			NSI	NSI
ZQ6L025	OB#3			NSI	NSI
ZQ6L026	OB#3	Not drilled
ZQ6L027	OB#3	55.0	81.0	26.0	17.65	including	3.00 5.00 6.00 4.00	38.30 14.96 26.92 20.59
		86.0	89.0	3.0	1.62
ZQ6L028	OB#3			NSI	NSI

In Table 2 below a summary of the drilling undertaken during the Stage II drilling is provided.

Table 2. Details of Zhongqu Stage II drill holes	Table 2. Details of Zhongqu Stage II drill holes	Table 2. Details of Zhongqu Stage II drill holes	Table 2. Details of Zhongqu Stage II drill holes
HoleNo	EastBJ3	NorthBJ3	Elev	TDepth	Azim	Dip	Rationale
XQ6L018	515265.500	3773173.000	3579.42	155.3	025	-14.0	Test mineralisation up dip of hole 014
XQ6L019	515265.500	3773173.000	3579.42	140.4	008	-15.0	Test mineralisation extent and west of 014
XQ6L020	515265.500	3773173.000	3579.42	230.2	008	-40.0	Test mineralisation immediatelywest of 014
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ASX code: RMX ABN 40 119568106

COMPANY DIRECTORS Neil Warburton Executive Chairman & Acting CEO Keith Rowe Executive Director

Michael Wolley Non-Executive Director

Shannon Coates Company Secretary

CONTACT DETAILS RED MOUNTAIN MINING LTD Head Office Unit 1, 2 Richardson Street West Perth Western Australia 6005 www.redmm.com.au info@redmm.com.au

XQ6L021	515345.520	3773257.500	3578.78	124.0	010	-38.0	Test continuation of GRD/LMST contact and minz
XQ6L022	515345.000	3773256.000	3578.50	146.9	060	30.0	Test down plunge mineralisation of OB#1
XQ6L023	515345.000	3773256.000	3578.50	150.0	048	0.0	Test projected down plunge position OB#1. 40m below 022.
XQ6L024	515265.500	3773173.000	3579.42	178.3	025	-53.0	Test mineralisation between holes 13 and 14
XQ6L025	515265.500	3773173.000	3579.42	180.0	025	10.0	Test up dip mineralisation from hole 018
XQ6L026	515265.500	3773173.000	3579.42	130.0	040	-30.0	Test mineralisation to east of 014 and updipof hole 015
XQ6L027	515345.000	3773256.000	3578.50	88.6	345.0	-10.0	Test mineralisation to the west of hole 010
XQ6L028	515345.000	3773256.000	3578.50	121.7	010	15.0	Test up dip mineralisation from hole 010

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Figure 2: Oblique 3D section (looking NE) of mapped and modelled ore bodies #1 and #3 which have been exploited at Xinqu mine. The red lines show the traces of the initial drillholes testing Ore Body #3 below Level 6 (in blue) and the proposed extension of Ore Body #1 above Level 6 (in purple).

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ASX code: RMX ABN 40 119568106

COMPANY DIRECTORS Neil Warburton Executive Chairman & Acting CEO Keith Rowe Executive Director

CONTACT DETAILS RED MOUNTAIN MINING LTD Head Office Unit 1, 2 Richardson Street West Perth Western Australia 6005 www.redmm.com.au info@redmm.com.au

Michael Wolley Non-Executive Director Shannon Coates Company Secretary

Resource Modelling

The drill results from Ore Body #3 were incorporated into a model of the mineralisation and a preliminary Inferred mineral resource was estimated, in accordance with the JORC Code guidelines. The purpose of this exercise was to determine an “order of magnitude” mineralisation potential for the Xinqu project to assist the Company’s investment decision.

This resource is summarised below and totals 390,600 tonnes grading 4.44 g/t Au (55,750 ounces Au) above a reporting grade of 1.0 g/t Au.

Table 3. Xingqu Ore Body #3 Gold resource (Zhongqu Project)	Table 3. Xingqu Ore Body #3 Gold resource (Zhongqu Project)	Table 3. Xingqu Ore Body #3 Gold resource (Zhongqu Project)	Table 3. Xingqu Ore Body #3 Gold resource (Zhongqu Project)	Table 3. Xingqu Ore Body #3 Gold resource (Zhongqu Project)
Reported above			Cont Gold (oz Au)
	tonnes	g/t Au		Classification
1.0 g/t Au	390,600	4.44	55,750	Inferred
3.0 g/t Au	291,600	5.19	48,650	Inferred

The resource dips shallowly to a depth approximately 120 metres below Level 6 of the Xingqu mine and restricted by the depth of drilling.

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Figure 3. 3D Schematic diagram showing the extension to Xinqu Orebody #3 below the 6 level and proposed new shaft access.

DIEBU PROJECT, GANSU

As announced on 5 March 2012, Red Mountain Mining withdrew from the Diebu Project for which the Company had a binding Framework Agreement over three granted Exploration Licences at Diebu, Gansu Province, China.

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ASX code: RMX COMPANY DIRECTORS CONTACT DETAILS ABN 40 119568106 Neil Warburton Michael Wolley RED MOUNTAIN MINING LTD Executive Chairman & Acting CEO Non-Executive Director Head Office Keith Rowe Unit 1, 2 Richardson Street Executive Director West Perth Western Australia 6005 Shannon Coates www.redmm.com.au Company Secretary info@redmm.com.au

Shannon Coates Company Secretary

The Diebu Project was reviewed by Red Mountain Mining and downgraded on a technical and commercial basis. Consequently the Company elected to withdraw from the Framework Agreement and not make any further payments towards this Deposit.

BOARD & MANAGEMENT CHANGES

The following changes to the Board and management structure were initiated by Red Mountain Mining subsequent to the end of the quarter.

• Mr Neil Warburton assumed the role of Executive Chairman and Acting CEO. Mr Warburton recently resigned from Barminco where he was CEO for the past five years, having doubled annual turnover during his leadership and enabling the company to become the largest underground mining contractor in Australia. He is one of the founding directors of Red Mountain Mining and has been on the Board since the Company’s formation six years ago.

• Mr Michael Wolley stepped down as non executive Chairman and will remain on the Board as an independent non-executive Director. With increasing time commitments arising from his full time role with Todd Corporation as Vice President of Corporate Development, Mr Wolley felt that he could not provide the time required to fulfil the Chairman’s role, but is still committed to being involved as a non executive director, having successfully led Red Mountain Mining through its IPO.

• Mr Bo Zhou, independent non-executive Director, resigned due to his increasing other business commitments. Mr Zhou was a founding director of Red Mountain Mining. He will continue to provide services to the Company as a project facilitator for China.

• Mr Andrew Richards, the Company’s CEO, stepped down from his role in order to pursue other mining related business opportunities, although he will continue to provide geological advisory services to the Company as required.

• Mr Keith Rowe continues to act as Executive Director responsible for Business Development China and Project Co-ordination.

• Mr Graeme Fraser, a geologist resident in Lanzhou, Gansu Province, PRC was appointed Exploration Manager. Mr Fraser has extensive experience as an exploration and production geologist in China where he has worked since 2005. He was Exploration Manager for Eldorado Gold’s Tianjanshan mine project in Qinghai, and Senior Geologist at Dragon Mountain Gold’s Lixian Gold project in Gansu.

• Ms Xiaozhou (Gloria) Li was appointed Financial Controller and brings extensive cross border accounting experience in commercial and mining resources to the company.

COMPANY STATUS AND OUTLOOK

Red Mountain Mining is currently reviewing a number of encouraging advanced stage projects in China and will advise the market in due course.

Michael Wolley Non-Executive Director

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ASX code: RMX ABN 40 119568106

COMPANY DIRECTORS Neil Warburton Executive Chairman & Acting CEO Keith Rowe Executive Director

CONTACT DETAILS RED MOUNTAIN MINING LTD Head Office Unit 1, 2 Richardson Street West Perth Western Australia 6005 www.redmm.com.au info@redmm.com.au

Shannon Coates Company Secretary

The Company remains in a very strong financial position with $5.1 million in cash and no debt as at 31 March, a strong technical team, and a pipeline of projects to assess.

The Company has also extended its search for advanced exploration and mining projects into the greater Asian region given several projects have come to the Company’s attention. Red Mountain Mining continues to maintain its core strategic focus of introducing modern Australian mining techniques to underdeveloped resource projects in the Asian region.

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

Company Investors Neil Warburton Ronn Bechler Executive Chairman Market Eye (+61) 408935014 (+61) 400 009 774 (+61 8) 9226 5668 (+61 3) 9591 8901

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About Red Mountain Mining Limited

Red Mountain Mining (ASX: RMX) is primarily a gold explorer and project acquisition company incorporated in Australia in May 2006 and which listed on the ASX in September 2011. The Company’s strategy is to unlock the potential of ‘under-developed’ gold and polymetallic projects by introducing Australian mining methods and improving efficiencies to gain significant production and exploration upside.

Red Mountain Mining has spent more than five years examining potential project acquisitions in China. The Company recently expanded its search for advanced exploration and mining projects to the greater Asian region following several significant projects coming to its attention.

Competent Person 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 Mining 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 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.

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ASX code: RMX ABN 40 119568106

COMPANY DIRECTORS Neil Warburton Executive Chairman & Acting CEO Keith Rowe Executive Director

CONTACT DETAILS RED MOUNTAIN MINING LTD Head Office Unit 1, 2 Richardson Street West Perth Western Australia 6005 www.redmm.com.au info@redmm.com.au

Michael Wolley Non-Executive Director

Shannon Coates Company Secretary

Appendix 5B Mining exploration entity quarterly report

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

RED MOUNTAIN MINING LIMITED

ABN 40 119 568 106

Quarter ended (“current quarter”) 31 March 2012

Consolidated statement of cash flows

Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (provide details if material) Net Operating Cash Flows	Current quarter $A’000	Year to date (9 months) $A’000
	0 (247) 0 0 (289) 0 47 0 0 0	0 (1448) 0 0 (1327) 0 128 0 0 0
	(489)	(2647)
Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets 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) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)	0 (290) (29) 0 0 0 0 0 0	0 (290) (29) 0 0 0 0 0 0
	(319)	(319)
	(808)	(2966)

• See chapter 19 for defined terms.

17/12/2010 Appendix 5B Page 1

Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(808)	(2966)
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 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows	0 0 0 0 0 0	7482 0 0 0 0 0
	0	7482
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end of quarter	0 5856 38	4516 447 123
	5086	5086

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities	Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities	Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities	Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities
1.23 1.24		Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
			40
			0
1.25 Explanation necessaryfor an understandingof 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 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest		Explanation necessaryfor an understandingof the transactions
	Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest

Financing facilities available

Add notes as necessary for an understanding of the position.

• See chapter 19 for defined terms.

Appendix 5B Page 2

17/12/2010

Appendix 5B Mining exploration entity quarterly report

	3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
		0	0
		20	2

Estimated cash outflows for next quarter

• 4.1 Exploration and evaluation

• 4.2 Development

4.3 Production 4.4 Administration

Total

$A’000 739 549 1288

Reconciliation of cash

Reco show the re	nciliation of cash at the end of the quarter (as n in the consolidated statement of cash flows) to lated items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
5.1 5.2 5.3 5.4	Cash on hand and at bank Deposits at call Bank overdraft Other (provide details)	2224 2862 0 0	2819
			3037
			0
			0
	Total: cash at end of quarter(item 1.22)	5086	5856

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.

• 5.1 Cash on hand and at bank

• 5.2 Deposits at call

• 5.3 Bank overdraft

• 5.4 Other (provide details)

Changes in interests in mining tenements

Changes in interests in	mining tenements
6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased	Tenement reference	Nature of interest (note (2))	Interest at beginning of quarter	Interest at end of quarter
	EL 62220081002036800 EL 62120080202032731 EL 62120090802036809 (“Diebu Project”)	Option to acquire 90%	Option to acquire 90%	-

• See chapter 19 for defined terms.

17/12/2010 Appendix 5B Page 3

Appendix 5B Mining exploration entity quarterly report

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 security (see note 3) (cents)	Amount paid up per security (see 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 securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs	79,060,026	64,546,875	-	-
			-	-
7.5 +Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted	-	-	-	-
	-	-	-	-
7.7 Options (description and conversion factor) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter	38,287,474	-	Exercise price $0.20 $0.20 $0.25 $0.35	Expiry date 12/09/2013 30/06/2014 31/07/2014 31/07/2016
		-
	-	-	-	-
	-	-	-	-
7.11 Debentures (totals only)	-	-

• See chapter 19 for defined terms.

Appendix 5B Page 4

17/12/2010

Appendix 5B Mining exploration entity quarterly report

7.12 Unsecured - - notes (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 5).

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

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Sign here: _____ Date: 31 March 2012 (Company secretary)

Print name: SHANNON COATES

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.

17/12/2010 Appendix 5B Page 5