SAVANNAH GOLDFIELDS LIMITED — Interim / Quarterly Report 2014

Apr 29, 2014

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Quarterly activities and cash flow report for the period ended 31 March 2014

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Level 9, Waterfront Place, 1 Eagle St, Brisbane QLD 4000 GPO Box 1164, Brisbane QLD 4001 Telephone: 07 3108 3500 Fax: 07 3108 3501 ABN: 75 003 049 714 Email: admin@lanewayresources.com.au www.lanewayresources.com.au ASX Code: LNY

Directors Stephen Bizzell (Chairman) Rick Anthon Ben Harrison Company Secretary Paul Marshall

Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Highlights

Agate Creek Gold Project

(Located approx. 40km south of Forsayth and 60km west of Kidston, North Queensland)

• The final results from the recent metallurgical sample processed through the Georgetown CIL gold processing plant (owned by JKO Mining Pty Ltd) highlight the potential of the Agate Creek gold project.

• A total of 1,725 ounces of gold was produced from the 5,472 tonne high-grade sample. The recovered gold grade was 9.8g/t gold from a feed grade of 11.2g/t gold. This represents a gold recovery rate of 87%. Some basic circuit and reagent improvements have been identified which the Company expects would boost recoveries to +90% for future processing.

• Laneway is currently assessing the benefits of carrying out a larger metallurgical sample to further investigate potential process route and gold recovery refinements. Laneway will work towards either an application to vary the existing MDL conditions or lodgement of a Mining Lease Application prior to undertaking the further larger metallurgical sample.

• EPM 17626 (Long Gully) was granted during the quarter. Also, EPM 17739 (Malcolm Creek) was acquired. The addition of these tenements now brings the total granted tenure area within the Agate Creek Gold Project to 737km[2] .

Southern Coromandel Gold Project (NZ)

(Located within 10km of Newmont’s Waihi Gold Mine and approx 140km south-east of Auckland, NZ)

• The entire project is currently being reviewed to identify future priority target areas. Subsequently, these areas will be the subject of a defined exploration program later in the year.

Ashford & Arrawatta Coal Projects

(Located approx. 60km north of Inverell, Northern New South Wales)

• Laneway’s coal assets provide a mix of advanced resource-stage projects through to drill-ready targets with reasonable tonnage potential. Discussions continue regarding the Company’s interest in the Ashford coking coal project, whereas exploration at Arrawatta is expected to re-commence later this year.

Corporate

• The Company is in the process of implementing a strategic review with a focus on assets that have a pathway to future development. This includes the review of new project opportunities.

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Figures 1 & 2 - Gold produced from recent Agate Creek metallurgical sample

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Figure 3 - Project Location Map

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Agate Creek Gold Project

Project Overview

The Agate Creek Gold Project is located approximately 40km south of Forsayth and 60km west of Kidston in North Queensland. The project comprises EPMs 17788, 17632, 17949, 17739, 17626, EPMA 17629 & MDL402 and hosts a total JORC Indicated and Inferred resource in excess of 400,000 ounces of contained gold (refer Resource Table below).

Metallurgical Sample Summary

As previously announced, the extraction and processing of a test sample from Agate Creek was completed during the quarter. The final results from this metallurgical sample, processed through the Georgetown CIL gold processing plant (owned by JKO Mining Pty Ltd), highlight the potential of the Agate Creek gold project.

A total sample of 5,472 dry metric tonnes was removed from less than 1,000m[2] surface area within the Agate Creek mining development lease (MDL 402). Very little waste material was encountered with the material largely exposed at surface giving an average overall excavation depth of only 3m. A small program of drilling and blasting was completed to facilitate the removal of the deeper material.

The sample was hauled approximately 110km by road to JKO’s processing plant, which has a nominal throughput capacity of 100,000tpa. The batch was processed on a continuous basis in December 2013 and January 2014 at an average feed rate of 8.5 dry tonnes per hour over a total of 28 days. Plant downtime during the period totalled 11.8 hours with 641.2 operating hours giving an overall runtime of 98.2%.

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Figures 4 & 5 - High grade epithermal veining from recent metallurgical sample

The main processing consumables were grinding balls, sodium cyanide, power and lime, with the results compared with laboratory scale CIL testwork completed by the Company in 2005.

The sodium cyanide consumption was in line with the prior laboratory test work where consumption was stated as being between 0.5kg/tonne and 0.7kg/tonne. Lime consumption was higher than laboratory testwork suggested however the plant operator’s use of hydrated lime rather than Quick lime (used in prior laboratory testwork) makes direct correlation difficult. The ore hardness during this trial was higher than the 2005 lab test and high grinding ball consumption highlighted that a review of this part of the process needs to be undertaken. The mill feed size of <12mm during the trial due to the basic 2 stage crushing circuit utilised by the plant operator, rather than the <8mm feed size during the lab tests, will have also exacerbated power and mill ball consumption. However, these higher than anticipated results may also be in part due to the highly silicified nature of the surface material extracted and not necessarily a reflection of the entire deposit.

A total of 1,725 ounces of gold was produced from the 5,472 tonne high-grade sample. The recovered gold grade was 9.8g/t Au from a feed grade of 11.2g/t Au. This represents a gold recovery rate of 87%. Some basic circuit and reagent improvements have been identified which the Company expects would boost recoveries to +90% for future processing. This includes the incorporation of gravity separation prior to leaching, changes to the crushing and grinding processes and a full review of the leach kinetics, in particular a focus on increasing the dissolved oxygen levels.

Laneway is currently assessing the benefits of carrying out a larger metallurgical sample to further investigate potential process route and gold recovery refinements. The Company will work towards either an initial application to vary the existing MDL conditions or lodgement of a Mining Lease Application prior to undertaking the further larger metallurgical sample.

Sherwood Resource

As per ASX release dated 22 March 2011, an updated Mineral Resource estimate was completed on the Agate Creek epithermal gold project in North Queensland. A global resource of 414,000oz of gold was estimated at Sherwood. The breakdown of the current estimate is shown below.

Resource estimates were undertaken for each of the Sherwood, Sherwood West and Sherwood South deposits and were based upon a total of 480 exploration drill holes compiled and interpreted by Laneway. Independent consultants Golder Associates Pty Ltd were engaged to update the modelling. The tables below indicate a recoverable resource estimate that is adjusted to account for a selective mining option and includes an allowance for mine dilution.

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Resource Estimates at 0.5g/t gold cut-off grade

0.5 g/t cut-off	Sherwood	Sherwood South	Sherwood West	Total
Resource Classification	Mt Gold (g/t) Gold (oz)	Mt Gold (g/t) Gold (oz)	Mt Gold (g/t) Gold (oz)	Mt Gold (g/t) Gold (oz)
Indicated Inferred	3.01 1.53 147,000 1.38 1.36 60,000	0.30 1.34 13,000	2.94 1.31 124,000 1.84 1.17 70,000	5.95 1.42 271,000 3.52 1.26 143,000
Total	4.39 1.47 207,000	0.30 1.34 13,000	4.78 1.25 194,000	9.47 1.36 414,000

Grade and tonnage rounded to one decimal place. Ounces rounded to nearest 1,000oz.

Potential for Increased Resources

Two deep diamond drill holes completed last year intersected altered and silicified granite, rhyolite and breccias. Results were reported in an ASX announcement dated 17 July 2013 and included a broad zone of mineralisation of 31m @ 5.96g/t Au from 124m (including 1m @ 73g/t Au). This high grade zone is within the currently modelled open pits, however the width and high grade nature of the zone will likely add to the existing known resource when incorporated into a new resource model.

The original focus of these two holes was to target high grade veins which are a common feature of low-sulphidation epithermal deposits worldwide (eg. the Vera-Nancy lodes within the Pajingo gold deposit). Unfortunately, the targeted deeper bonanza feeder zone was not intercepted in either hole but remains a valid target for future drilling as it appears that the aforementioned results correlate to a separate boiling zone within the system.

Laneway is planning a follow-up drill program to further test the continuity of this high grade zone as well as testing other nearby structural and regional targets.

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Figures 6 & 7 - Small gold particle from hole CCDD482 within a 0.6m intercept averaging 10.2g/t Au from 188.4m. Images are 40x zoom (LHS) and 100x zoom (RHS). Results as per ASX announcement dated 17 July 2013.

Acquisition of EPM 17739 (Malcolm Creek)

The acquisition of EPM17739 Malcolm Creek for the Agate Creek gold project in Queensland was finalised during the quarter. This tenure is located 40km southwest of Forsayth between existing Laneway tenements and applications as seen in Figure 8. Consideration for the transfer was $10,000 in shares (issued in late 2013) and a residual 1.5 % NSSR on any production.

Previous drilling within EPM17739 has revealed the potential for diatreme breccia pipe associated gold deposits along with vein style and breccia hosted gold. The tenement holds several highly prospective targets which include the drill ready targets at Bald Mountain and Kimberley Sue.

Historic drill results include 2m @ 19.7g/t gold and 2m @ 9g/t gold from separate prospects that both require follow up, in addition to a 10g/t gold stream sediment anomaly whose source is still to be located.

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Grant of EPM 17626 (Long Gully)

EPM 17626, which was applied for in 2010, was granted during the quarter. This expands the total granted tenure within the Agate Creek project area to 737km[2] .

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Figure 8 - Location of Agate Creek Project including granted and application tenure. EPM17949 & EPM17626 are non-contiguous. EPM 17739 & EPM 17626 highlighted.

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Southern Coromandel Gold Project (NZ)

Project Overview

Laneway’s Southern Coromandel Project comprises four granted exploration permits (EP53464, EP53469, EP54216 and EP55213) covering approximately 400km[2] . The permits lie within the highly prospective Hauraki Goldfields which have produced over 40 million ounces of Au-Ag bullion from over 50 deposits. The operating Martha Hill mine at Waihi is the largest deposit in the region and is currently producing an average of 100,000oz of gold and 700,000oz of silver annually.

Quarterly Activities

All statutory reporting was completed within the March quarter. The entire project is currently being reviewed to identify future priority target areas. Subsequently, these areas will be the subject of a defined exploration program later in the year.

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Figure 9 – Location of Granted Permits on the Southern Coromandel Peninsula, New Zealand

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Ashford & Arrawatta Coal Projects

Project Overview

The Ashford Coking Coal project is located approximately 60km north of Inverell (northern NSW) and comprises a 50/50 joint venture with Northern Energy Corporation, a 100% owned subsidiary of New Hope Corporation. Ashford is an advanced stage coking coal project – as per Annual Report lodged with the ASX on 30 September 2013, the project hosts an indicated resource of 8.2Mt and an inferred resource of 5Mt. Arrawatta is an early stage coal project located 10km north of Inverell, with the tenement comprising the interpreted extension of the Ashford coal measures.

Quarterly Activities

Following an extensive review of the Company’s coal tenements, it was decided to focus on key holdings and thus retain only the most highly prospective target areas. As a result the whole Atholwood tenement was dropped and 70% of EL 6521 relinquished. Discussions continue regarding the Company’s interest in the Ashford coking coal project, whereas exploration at Arrawatta is expected to re-commence later this year.

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Figure 10 – Location of NSW Coal Tenements

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Figure 11 – Ashford Project Geology

Rockland Gold Project

Project Overview

The Rockland Gold Project is located near Warwick in Southern Queensland and comprises EPM19368 and EPM19571, covering over 300km[2] . The area is considered prospective for Intrusion Related Gold Systems (IRGS) and variants.

Quarterly Activities

Literature reviews across the area have shown very little work completed, possibly due to the large alluvial goldfields to the north and west which have been the main focus of historical exploration. Mapping was completed by several companies and highlighted the Herries Adamellite, Ruby Creek Granite and Greymare Granodiorite as having the potential to be associated with mineralisation. The dyke swarm in the central part of the project area has largely been ignored. Planned work for the rest of the year includes geological mapping and geochemical sampling focussed on the dyke swarm in the central part of the project area along with areas immediately surrounding.

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Corporate

• Subsequent to the end of the quarter, Laneway has commenced recovery action against JKO Mining Pty Limited (“JKO”) relating to amounts owing to Laneway for its share of the gold proceeds from the recent metallurgical sample that was processed through JKO’s plant. JKO is currently disputing the amount being claimed by Laneway.

• The Company is in the process of implementing a strategic review with a focus on assets that have a pathway to future development. This includes the review of new project opportunities.

• Discussions continue regarding the Company’s interest in the Ashford coking coal project.

• During the March quarter, a total of $376,000 was spent on exploration, metallurgical sampling and corporate costs.

For further information contact: Ben Harrison Director, Laneway Resources Phone: (07) 3108 3500 E-Mail: admin@lanewayresources.com.au

Competent Persons Statement

The information in this report that relates to Exploration Results and Mineral Resources (except Ashford Coal Resource) is based on information compiled by Mr Scott Hall who is a member of the Australian Institute of Mining and Metallurgy. Mr Hall is a full-time employee of Laneway Resources Limited and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are 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.’ Mr Hall consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

This information was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported.

Information herein relating to Ashford Coal Resources is based on information compiled by Mr Phillip Bryant who is a member of the Australian Institute of Mining and Metallurgy. Mr Phillip Bryant is currently an employee of New Hope Coal Limited. Mr Phillip Bryant has sufficient experience relevant to the style of mineralisation and type of deposit being reported 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, Minerals Resources and Ore Reserves’ (the JORC Code). Mr Phillip Bryant consents to the inclusion in the report of the matters based on the information in the form and context in which it appears.

This information was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported.

ASX Code: LNY

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Quarterly activities and cash flow report for the period ended 31[st] March 2014

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Schedule of Interests in Mining Tenements

Laneway Resources Limited held the following interests in mining and exploration tenements as at 31 March 2014:

Queensland Tenements

Queensland Tenements
Type & Title No.	Location	Interest
MDL402	Agate Creek	100%
EPM17632	Agate Creek	100%
EPM17788	Agate Creek	100%
EPM17949	Agate Creek	100%
EPM17626	Agate Creek	100%
EPM17739	Agate Creek	100%
EPMA17629	Agate Creek	Pending Grant
EPM19368	Rocklands	100%
EPM19571	Rocklands	100%

NSW Tenements

NSW Tenements
Type & Title No.	Location	Interest
EL6234	Ashford	50%
EL6428	AshfordNorth	50%
EL6433	Arrawatta	100%
EL6521	RobRoy	100%

New Zealand Tenements

New Zealand Tenements
Type & Title No.	Location	Interest
EP53464	Klondyke	100%
EP53469	Waitekauri	100%
EP54216	Owharoa	100%
EP55213	Waiorongamai	100%

Changes in Interests in Mining Tenements

\

|
||||||
|---|---|---|---|---|---|
||Tenement
Reference|Location|Interest at
start of qtr |Interest at
end of qtr |Comments|
|Interests in mining
tenements relinquished,
reduced or lapsed|EL6526|Atholwood
(NSW)|50%|Nil|Relinquished|
|Interests in mining
tenements acquired or
increased|EPM17626
EPM17739|Agate Ck (Qld)
Agate Ck (Qld)|Nil
Nil|100%
100%|Appln Granted
Acquired|

ASX Code: LNY

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Rule 5.5

Appendix 5B

Mining exploration entity and oil and gas 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, 01/05/2013

Name of entity

LANEWAY RESOURCES LIMITED

ACN or ARBN

003 049 714

Quarter ended (“current quarter”)

31 March 2014

Consolidated statement of cash flows

Cash flows related to operating activities 1.1 Receipts from product sales and related debtors - exploration grant 1.2 Payments (a) exploration and evaluation (b) development (c) production costs (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 Net Operating Cash Flows	Current quarter $A’000	Year to date (9 months) $A’000
	340 - (169) - - (207) - - (1) - -	340 142 (361) - - (764) - - (2) - -
	(37)	(645)
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 - Security bond deposits Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)	- - - - - - - - -	- - - - - - - - 10
	-	10
	(37)	(635)

• See chapter 19 for defined terms.

01/05/2010

Appendix 5B Page 1

Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(37)	(635)
Cash flows related to financing activities 1.14 Proceeds from issues of shares and call payments 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 - Payment of finance lease principal Net financing cash flows	- - 46 - - (2)	331 - 281 - - (7)
	44	605
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 1.22Cash at end of quarter	7 (4) -	(30) 33 -
	3	3

Payments to directors of the entity, associates of the directors, related entities of the entity and associates of the related entities

1.2 Aggregate amount of payments to the parties included in item 1.2 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
	-
	-

• 1.2 Explanation necessary for an understanding of the transactions

Nil

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

Nil

• 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

Nil

• See chapter 19 for defined terms.

Appendix 5B Page 2

01/05/2010

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	500	281
	-	-

The company has a loan facility of $500,000 provided by a director related entity

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.2 Administration	$A’000
	100
	-
	-
	150
Total	250

Reconciliation of cash

Reconciliation of cash
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.	Current quarter $A’000	Previous quarter $A’000
5.1 Cash on hand and at bank 5.2 Deposits at call 5.3 Bank overdraft 5.4 Other (provide details)	3	(4)
	-	-
	-	-
	-	-
Total: cash at end of quarter(item 1.22)	3	(4)

Changes in interests in mining tenements

Tenement reference	Nature of interest (note (2))	Interest at beginning of quarter	Interest at end of quarter
EL6526	Relinquished	50%	Nil
EPM 17626 EPM 17739	Application granted Acquisition	Nil Nil	100% 100%

• See chapter 19 for defined terms.

01/05/2010

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.

	Number issued	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	nil
7.3 +Ordinary securities - fully paid 7.4 Changes during quarter -	1,376,598,482	1,376,598,482
7.5 +Convertible debt securities 7.6 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs, or conversions (c) Increases through interest reinvestment	nil
7.7 Options (description and conversion factor) Employee Options 7.8 Issued during quarter Employee Options 7.9 Exercised during quarter Employee Options 7.10 Expired during quarter Employee Options			Exercise price	Expiry date
7.11 Debentures (totals only)	nil
7.12 Unsecured notes(totals only)	nil

• See chapter 19 for defined terms.

Appendix 5B Page 4

01/05/2010

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

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.

Sign here: JPK Marshall Date: 30/4/14 (Company Secretary)

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.

01/05/2010

Appendix 5B Page 5