REDSTONE RESOURCES LIMITED — Interim / Quarterly Report 2011

Oct 31, 2011

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QUARTERLY REPORT

For the Period ending September 30 2011

31 October 2011

The Board of Redstone Resources Limited (“the Company” or “Redstone”) is pleased to present its quarterly report for the period ending 30 September 2011.

Redstone is confident that the Tollu Copper Nickel Project has the potential to be a world class deposit. Intersections of copper sulphide mineralisation of greater than 1% Cu now extend over an area of 1.8km long and up to 1km wide. Redstone expects that both the mineralised area and the volume of hydrothermal mineralisation will increase significantly with further drilling.

HIGHLIGHTS

• A 5,000m RC drilling programme commenced at the Tollu Cu-Ni Project in September 2011.

• The drilling has intersected thick zones of copper sulphide mineralisation at the Eastern Zone.

FUTURE WORK

Redstone is planning the following exploration activity for the coming months with the following programmes to be implemented:

• The completion of the current RC drilling programme at the Tollu Cu-Ni Project.

• Plan and commence further RC drilling at the Tollu Cu-Ni Project during the December Quarter.

• Commencement of diamond drilling program at the Tollu Cu-Ni Project during the December Quarter.

• Commencement of RC drilling at the Blackstone Range project during the December Quarter.

Redstone Resources Limited ABN 42 090 169 154 Suite 3, 110-116 East Parade, East Perth WA 6004 Tel: 08 9328 2552 Fax: 08 9328 2660

www.redstone.com.au Email: contact@redstone.com.au

ASX: RDS

PROJECTS

The company holds interest in 9 exploration licenses in three project areas in the West Musgrave region of Western Australia. The projects are prospective for major copper, nickel-copper and PGE mineralisation. The exploration licenses cover in excess of 2,200km[2] . Proje c t locations are shown on Figures 1 and 2. Six of the exploration licenses held by Redstone com p rise the Baggaley Hills Farmin/Joint Venture, which is an exploration joint venture between Redst o ne and HJH Nominees Pty Ltd (HJH), where HJH is e arning an 80% interest. A further two explorat i on licenses are part of the Blackstone Range Farmi n /Joint Venture between Redstone and Resource Mining Corporation where Redstone is earning in to 90%. The remaining exploration license is wholly owned and operated by Redstone and c o mprises the Tollu Copper Nickel Project.

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Figures 1 & 2 Location of Redst o ne Resources Projects

Tollu Copper Nickel Proje c t (Redstone 100%)

(E69/2450)

The Tollu Project area host s a giant swarm of hydrothermal copper rich veins in a mineralised system covering an area of at least 6km[2] and forming part of a dilation syst e m between two major shears. Copper mineralisati o n exposed at the surface comprises malachite, tenorite and azurite. The project hosts multiple m i neralised target zones (Figure 3). During the qu a rter a review of the IP survey was completed and a 5 ,000m RC drill programme commenced.

Redstone Resources Limited ABN 42 090 1 6 9 154 Suite 3, 110-116 East Parade, East Perth WA 600 4 Tel: 08 9328 2552 Fax: 08 9328 2660

www.redstone.com.au E mail: contact@redstone.com.au

ASX: RDS

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Figure 3 Target Zones at the To l lu Copper Nickel Project

RC Drilling Program

The 5,000m RC drill program commenced in early September 2011 and duri n g the Quarter has initially focused on the Easte r n Zone. The program was designed to:

• Investigate the extension at depth, to the southeast and northwest o f the Central Zone mineralisation;

• Confirm the significance of the discovery of high grade hydrotherm a l copper sulphide mineralisation (5% C u ) at the Eastern Zone;

• Identify the presenc e of gabbro stock (mafic) at depth which is int e rpreted to be the magmatic source for the mineralisation at Tollu; and

• Test part of the 1k m surface mineralisation which has recently bee n identified at the Western Zone.

As previously reported on 2 2 September 2011, Redstone’s drilling results to date are very encouraging with thick zones of visible copper sulphide mineralisation bei n g observed from holes TLC045, TLC052 and T L C054. High water flow rates resulted in high co p per sulphide loss from drill samples within the mineralised zones. This has made it difficult to properly evaluate the true copper grades intersected.

ASX: RDS

Diamond Drill Program

As a result of the loss of co p per sulphides from drill samples due to the high water flows, a diamond drill programme is being planned to provide accurate samples of t he mineralisation intersected at the Eastern Zone. This drill programme is expected to com m ence during the December Quarter.

Induced Polarisation (IP) S urvey

The ground based IP Surve y was completed in late June 2011. The geophysics consultant’s report on the results of the s u rvey was received in September 2011.

The DDIP surveys at Tollu ha v e shown a good correlation of chargeability a n omalism with the major north-south (N-S) faults and the northwest (NW) oriented shear zones. The source of the chargeability anomalis m is likely to be the disseminated pyrite and chalcopyrite mineralisation associated with outcropping hydrothermal quartz veining alon g these zones.

Other N-S oriented chargea b ility trends have been mapped in the northea s t (NE) part of the survey area, which may be reflecting further hydrothermal mineralisatio n along structures covered by overburden and w eathered regolith cover.

Chargeability responses are typically due to disseminated sulphides, as opposed to massive sulphides, and it is likely t hat the survey is only detecting the top o f the mineralised hydrothermal veining syste m . The depth of investigation of this survey i s estimated to be approximately 200m.

Drill targets generated by the survey will form part of a new RC drill progr a mme planned to commence in the December Q uarter.

Exploration Planned at th e Tollu Cu-Ni Project for the December Qua r ter

• Complete the third d r illing program consisting of a total of 5,000m R C

• Plan and commence f urther RC drilling at the Tollu Cu-Ni Project

• Commence a diamo n d drill programme

Blackstone Range Farmin / Joint Venture (Redstone earning 90%: R e source Mining Corporation Ltd (ASX:RMI) 1 0%) (E69/2108 and E69/2109)

The Blackstone Project is loc a ted approximately 25km east of the BHP Babel and Nebo Ni-CuPGE discoveries. The project area is prospective for Cu-Ni-PGE + Au. The p roject contains a number of prospects includi n g:

• Halleys.

• Last Frontier.

• Saturn.

Redstone Resources Limited ABN 42 090 1 6 9 154 Suite 3, 110-116 East Parade, East Perth WA 600 4 Tel: 08 9328 2552 Fax: 08 9328 2660

www.redstone.com.au

E mail: contact@redstone.com.au

ASX: RDS

An IP survey was completed across the Halleys Prospect earlier this year. T he IP survey was designed to follow up shallo w drilling results, soil sampling and a discrete E M anomaly. The preliminary results of the su r vey are encouraging with the identification of an IP anomaly that appears to be concordant w ith a previously identified EM anomaly. Geop h ysics consultant’s report on the results of the survey was received after the end of the Qu a rter and is being assessed.

Exploration Planned at Bl a ckstone Range Farmin/Joint Venture for th e December Quarter

• Assessment of Geop h ysics consultant’s report.

• Plan and commence R C/diamond drill programme.

Baggaley Hills Farmin/Joi n t Venture (HJH earning 80%)

(E69/2053, E69/2054, E69/2 3 39, E69/2340, E69/2249 and E69/2200)

The Baggaley Hills project is p rospective for both Ni-Cu-PGE and Iron Oxide C o pper Gold (IOCG) mineralisation. Several areas within the project have been identified as hi g h priority targets based upon geochemical, magnetic and gravity signatures and IP surveys.

At the end of the Quarter R edstone Resources had not received any data in relation to the 6,800m RC drill programme c ompleted earlier this year. The drill programm e was designed to test geophysical anomalies ( m agnetic, gravity and IP). Assay results from th e drilling program are still pending.

CORPORATE

Redstone Resources Limited presented at Paydirt’s Australia Nickel Confer e nce held in Perth 29-30[th] September. The r elevant presentation is available on Redstone’s website.

Redstone Resources Limited ABN 42 090 1 6 9 154 Suite 3, 110-116 East Parade, East Perth WA 600 4 Tel: 08 9328 2552 Fax: 08 9328 2660

www.redstone.com.au

E mail: contact@redstone.com.au

ASX: RDS

About Redstone

Redstone Resources Ltd is a Perth Based exploration company with a portfolio of highly prospective mineral explorat i on properties in the West Musgrave region of W A and Brazil.

Redstone is an explorer f o cused on nickel and copper in Western A ustralia. Further information on Redstone can be found on the company’s website at www.re d stone.com.au.

Investor Enquiries: Telephone: +61 8 9328 2552 Facsimile: +61 8 9328 2660 Email: cont a ct@redstone.com.au Website: ww w .redstone.com.au Address: PO B o x 8646, Perth Business Centre WA 6849

ATTRIBUTION

The information in this report rela t es to exploration results is based on information compil e d by Dr Joao Orestes Santos, a part-time employee of R e dstone Resources Limited. Dr Santos is a member of the A ustralian Institute of Geoscientists and has sufficient ex p erience relevant to the style of mineralisation under co n sideration and to the activity which he is undertaking to q ualify as a Competent Person as defined in the 2004 Editi o n of the ‘Australasian Code for Reporting Exploration Res u lts, Mineral Resources and Ore Reserves’. Dr Santos cons e nts to the inclusion in the report of the matter based on his information in the form and context in which it appears.

Redstone Resources Limited ABN 42 090 1 6 9 154 Suite 3, 110-116 East Parade, East Perth WA 600 4 Tel: 08 9328 2552 Fax: 08 9328 2660

www.redstone.com.au E mail: contact@redstone.com.au