ST GEORGE MINING LIMITED — Interim / Quarterly Report 2014

Apr 29, 2014

30 April 2014

QUARTERLY ACTIVITIES REPORT FOR THE PERIOD ENDED 31 MARCH 2014

HIGHLIGHTS

• Major nickel exploration campaign continues
• Comprehensive moving loop electromagnetic (MLEM) survey over priority target areas
• High quality EM conductors identified by MLEM survey for drill testing
• 2014 drill campaign scheduled to commence in mid‐May 2014
• Technical team boosted by addition of nickel specialist from BHP Billiton Nickel West

St George Mining Limited (ASX:SGQ) ("St George Mining") is pleased to present its Quarterly Activities Report for the period ended 31 March 2014.

EAST LAVERTON PROPERTY

MLEM Survey Recommences

The MLEM survey over the high priority nickel target areas recommenced this quarter after a Christmas recess. Figure 1 illustrates the areas planned to be surveyed by the MLEM survey and highlights the areas covered so far.

The first phase of the MLEM survey focused on a key section of the Stella Range belt where nickel sulphide has already been identified by three RC drill holes ‐ DRAC35, DRAC38 and DDNRC002 (see Table 1 for significant intersections).

These spaced intersections demonstrate the presence of several nickel‐rich mineral systems within this portion of the Stella Range belt, which increases the potential for EM conductors located in this area to be massive nickel sulphide deposits.

Strong EM Conductors Identified

The MLEM survey has been successful in identifying several high quality EM conductors in this section of the belt. Figure 2 illustrates the EM conductors identified so far within this area.

The EM conductor at Desert Dragon North, labelled DDN1, is rated as a Category One target by Newexco – the Company's geophysical consultants. This EM conductor is directly co‐incident with a strong magnetic anomaly. It is also situated within a broad area of elevated Ni‐Cu soil geochemical values and is proximal to drill hole DDNRC002 which intersected 2m @ 1.08% Ni with visible massive nickel sulphide veinlets. This interval is interpreted to be potentially part of a larger mineralised system.

Fixed loop electromagnetic (FLEM) surveys are being conducted over the priority conductors to provide higher resolution of the conductive body and enhance drill hole selection. Two lines of FLEM were conducted over DDN1 yielding two separately modelled sources ‐ DDN1A and DDN1B. These two sources

are modelled as being from the same conductive body. Significantly, the location of the DDN1 conductor has been confirmed as being directly along strike from drill hole DDNRC002 in the north.

Once the FLEM surveys are conducted over the remaining EM conductors and modelling completed, final drill hole selection for each EM target will be determined.

Desert Dragon – Down‐hole EM (DHEM) Survey at Diamond Drill Holes

A DHEM survey was carried out at each of the three diamond drill holes completed late last year at the Desert Dragon nickel prospect. The survey identified EM anomalies in two of the holes, DDD001 and DDD002, which warranted further assessment.

Interpretation and modelling of the EM anomalies has been completed by Newexco, the Company's geophysical adviser, which has rated these conductors as Category One targets and recommended test drilling.

The source of the conductance of each EM conductor is a discrete short‐strike EM response located within a large TMI magnetic anomaly. The significant nickel sulphide potential of the EM conductors is highlighted by their proximity to the nickel sulphide intersection in the nearby drill hole DRAC35 (18m @ 0.40% Ni from 100m).

Figure 1 – the areas on the Stella Range Belt being covered by the MLEM survey. Cambridge, Desert Dragon North, Desert Dragon and Windsor have been completed. The target currently being surveyed is Bristol.

Figure 2 ‐ TMI (Total Magnetic Intensity) RGB plan map with location of modelled EM conductors along a high priority section of the Stella Range belt that hosts the Desert Dragon North, Desert Dragon and Windsor nickel prospects. The DDN1 conductor is now modelled as two plates – DDN1A and DDN1B.

HOLE ID	NORTHING(m)	EASTING(m)	DIP(deg)	AZM(deg)	DEPTH(m)	FROM(m)	TO(m)	WIDTH(m)	Ni(%)	Cu(ppm)	Pt+Pd(ppb)
DRAC35	6739401	527150	‐60	250	244	100	118	18	0.40	342	197
						100	104	4	0.57	366	294
						112	114	2	0.51	584	281
DRAC38	6733696	530786	‐60	250	298	108	138	30	0.31	10	31
						132	138	6	0.48	40	48
						132	134	2	0.62	92	53
DDNRC002	6742718	523717	‐60	59	246	53	60	7	0.54
						53	55	2	1.08

Table 1 – Significant intersections in DRAC35, DRAC38 and DDNRC002

High Impact Drill Campaign

Preparation for Phase 1 of the 2014 drilling programme is being finalised with drilling planned to commence in mid‐May 2014. Dates will be confirmed closer to the start of drilling.

The drill campaign is the Company's first ever test drilling of EM conductors along the Stella Range belt.

A multi‐purpose drill rig has been engaged for this drilling programme with planned holes including a combination of diamond core and reverse‐circulation (RC) drilling.

ADDITION TO EXPLORATION TEAM

Mr Matthew McCarthy joined St George Mining as a consulting geologist in February 2014. Mr McCarthy is a senior geologist with a strong background in komatiite‐hosted nickel exploration in Western Australia. He joins us from BHP Billiton Nickel West, where he was part of the team that made the recent discovery of the significant Venus nickel sulphide deposit at Leinster.

Mr McCarthy also managed the exploration programme under the previous farm‐in arrangement between St George Mining and BHP Billiton Nickel West, which discovered nickel sulphides at East Laverton in 2012.

LAKE MINIGWAL PROJECT

The Lake Minigwal Project is prospective for gold and nickel sulphides, and is interpreted to be on the same north‐east trend that hosts the Mulga Tank Nickel Project of Impact Minerals Ltd (ASX: IPT) to the south.

A soil geochemical survey has been designed for the project area, for completion in Q2/Q3 2014.

No field work was completed at the Lake Minigwal Project during the quarter.

PINE CREEK PROPERTY

No field work was carried out during the quarter.

JORC 2012:

The information is extracted from the reports entitled "Major Nickel Exploration Campaign Continues" created on 23 January 2014, "Exceptional EM Conductor" created on 24 February 2014, "Further Strong EM Conductors" created on 13 March 2014, "Significant EM Targets Added for Drill Campaign" created on 8 April 2014 and "St George Prepares for High Impact Drill Campaign" created on 23 April 2014 and are available to view on http://stgeorgemining.com.au/. The Company confirms that it is not aware of any new information or data that materially affects the information included in any original market announcements referred to in this report, and that all material assumptions and technical parameters underpinning the announcements continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcements.

TENEMENT INFORMATION AS REQUIRED BY LISTING RULE 5.3.3

No tenements, in part o r whole, were relinquished, surrendered o r otherwise divested during the quarterly period ended 31 March 2014.

Tenement ID	Registered Holder	Location	Ownership	Change in Quarter
E39/0981	Desert Fox	East Laverton	(%)100	N/A
	Resources Pty Ltd	Property
E39/0982	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/0985	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1064	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1066	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1229	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1461	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1472	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1473	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1474	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1475	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1476	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1467	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1492	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1518	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1519	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1520	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1521	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1549	Desert Fox	East Laverton	100	N/A
E39/1565	Resources Pty LtdDesert Fox	PropertyEast Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1572	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1601	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1608	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property

E39/1655	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1666	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1667	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1722	Desert Fox	East Laverton	100	N/A
	Resources Pty Ltd	Property
E39/1677	St George Mining	Lake Minigwal	100	N/A
	Limited	Project
E39/1678	St George Mining	Lake Minigwal	100	N/A
	Limited	Project
EL 27732	Geotech	Pine Creek Property	80	N/A
	International Pty
	Ltd & James
	Stewart
EL 28016	Blue Thunder	Pine Creek Property	80	N/A
	Resources Pty Ltd
EL 28017	Blue Thunder	Pine Creek Property	80	N/A
	Resources Pty Ltd
EL 28232	Blue Thunder	Pine Creek Property	80	N/A
	Resources Pty Ltd
EL 28463	Blue Thunder	Pine Creek Property	80	N/A
	Resources Pty Ltd

N.B. Background on the Pine Creek Property

• 1. EL 27732 at the Pine Creek Property is currently registered in the names of Geotech International Pty Ltd and James Stewart (50% each). St George Mining Limited has an option to acquire an 80% interest in that tenement. That option has not been exercised.
• 1. All other tenements at the Pine Creek Property are registered solely in the name of Blue Thunder Resources Pty Ltd, a wholly owned subsidiary of St George Mining Limited. Geotech International Pty Ltd and James Stewart have a 20% beneficial interest in each of these tenements.

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

St George Mining Limited

21 139 308 973 31 Mar 2014

ABN Quarter ended ("current quarter")

Year to date

Current quarter

Consolidated statement of cash flows

	Cash flows related to operating activities	$A'000	(9.months)$A'000
1.1	Receipts from product sales and relateddebtors	‐	‐
1.2	Payments for(a) exploration & evaluation	(598)	(1,555)
	(b) development	‐	‐
	(c) production	‐	‐
1.3	(d) administrationDividends received	(132)‐	(497)‐
1.4	Interest and other items of a similar naturereceived	9	19
1.5	Interest and other costs of finance paid	‐	‐
1.6	Income taxes paid	‐	‐
1.7	Other ‐ GST	‐	28
	Other – Reimbursements	‐	286
	Other – R&D Tax Incentive	‐	596
		(721)	(1,123)
	Net Operating Cash Flows
	Cash flows related to investing activities
1.8	Payment for purchases of:(a) prospects	‐	‐
	(b) equity investments	‐	‐
	(c) other fixed assets	(21)	(21)
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	(21)	(21)

+ See chapter 19 for defined terms.

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

1.13	Total operating and investing cash flows	(742)	(1,144)
	(brought forward)
	Cash flows related to financing activities
1.14	Proceeds from issues of shares, options, etc.	‐	825
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 – Capital Raising Costs	(8)	(33)
		(8)	792
	Net financing cash flows
	Net increase (decrease) in cash held	(750)	(352)
1.20	Cash at beginning of quarter/year to date	1,275	877
1.21	Exchange rate adjustments to item 1.20
		525	525
1.22	Cash at end of quarter

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

		Current quarter$A'000
1.23	Aggregate amount of payments to the parties included in item 1.2	128
1.24	Aggregate amount of loans to the parties included in item 1.10	‐

1.25 Explanation necessary for an understanding of the transactions

$'000
Directors fees and remuneration 105
Accounting, bookkeeping, corporate secretarial and general administrative services 23

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

N/A

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

N/A

+ See chapter 19 for defined terms.

Financing facilities available

Add notes as necessary for an understanding of the position.

		Amount available$A'000	Amount used$A'000
3.1	Loan facilities	‐	‐
3.2	Credit standby arrangements	‐	‐

Estimated cash outflows for next quarter

		$A'000
4.1	Exploration and evaluation	250
4.2	Development	‐
4.3	Production	‐
4.4	Administration	150
	Total	400

Reconciliation of cash

Reconciliation of cash at the end of the quarter (asshown in the consolidated statement of cash flows) tothe related items in the accounts is as follows.		Current quarter$A'000	Previous quarter$A'000
5.1	Cash on hand and at bank	9	16
5.2	Deposits at call	516	259
5.3	Bank overdraft	‐	‐
5.4	Other – Term Deposit	‐	1,000
	Total: cash at end of quarter (item 1.22)	525	1,275

+ See chapter 19 for defined terms.

		Tenementreferenceandlocation	Nature of interest(note (2))	Interest atbeginningof quarter	Interest atend ofquarter
6.1	Interests in miningtenements andpetroleum tenementsrelinquished, reduced orlapsed	N/A	N/A	N/A	N/A
6.2	Interests in miningtenements andpetroleum tenementsacquired or increased	N/A	N/A	N/A	N/A

Changes in interests in mining tenements and petroleum tenements

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 persecurity (see note3) (cents)	Amount paid up persecurity (see note 3)(cents)
7.1	Preference+securities	100	‐	‐	‐
7.2	Changes duringquarter
	(a) Increasesthrough issues	‐	‐	‐	‐
	(b) Decreasesthrough returns	‐	‐	‐	‐
	of capital, buy‐backs,
	redemptions
7.3	+Ordinarysecurities	79,481,000	79,481,000	‐	‐
7.4	Changes duringquarter
	(a) Increasesthrough issues	‐	‐	‐	‐
	(b) Decreasesthrough returnsof capital, buy‐backs	‐	‐	‐	‐
7.5	+Convertibledebt securities(description)	‐	‐	‐	‐

+ See chapter 19 for defined terms.

7.6	Changes duringquarter(a) Increasesthrough issues(b) Decreasesthroughsecuritiesmatured,converted	‐‐	‐‐	‐‐	‐‐
7.7	Options			Exercise price	Expiry date
	(description and	48,508,000	48,508,000	0.20	28 November 2014
	conversion	750,000	‐	0.25	28 November 2014
	factor)	1,000,000	‐	0.40	28 November 2015
7.8	Issued during	100,000	‐	0.25	28 November 2014
	quarter	100,000	‐	0.40	28 November 2015
7.9	Exercised during	‐	‐	‐	‐
	quarter
7.10	Expired during	‐	‐	‐	‐
	quarter
7.11	Debentures	‐	‐
	(totals only)
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.

Company secretary

Sign here: Sarah Shipway Date: 30 April 2014

Print name: Sarah Shipway

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.

+ See chapter 19 for defined terms.

• 2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements and petroleum 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 or petroleum 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.