STRIKE RESOURCES LIMITED — Capital/Financing Update 2012

Oct 16, 2012

Wednesday, October 17 2012

Strike Receives Shootout Counter-Offers

Announcement Highlights

• Strike receives three counter-offers under the shoot-out process
• D&C Pesca made the highest counter-offer and is obliged to pay Strike total cash consideration of approximately US$62 million
• Strike is seeking evidence from D&C Pesca to support its financial capacity to meet its payment obligations

Background on the shoot-out counter-offer process

Strike Resources Limited (Strike or the Company) announces that three separate counter-offers have been provided by Ausinca Peru S.A.C. (Ausinca), D&C Group S.A.C. (D&C Group) and D&C Pesca S.A.C. (D&C Pesca) under the shootout process to acquire Strike's 50% interest in Apurimac Ferrum S.A. (AF), as negotiated under the AF Settlement Agreement (AFSA).

Prior to the shoot-out process, Strike held 50.1% of the shares of AF, with the remainder held by D&C Pesca (19.3%), D&C Group (less than 0.01%) and Ausinca (30.6%) (collectively the D&C Group Shareholders).

Under the shoot-out process, each of the D&C Group Shareholders had until 3 October 20121 to either accept the Strike offer or submit a counter-offer to Strike, including the repayment of Strike's loans to AF of approximately US$30.7 million. No counter-offer was submitted by the due date, which the AFSA deems to be the equivalent of a rejection by all of the D&C Group Shareholders of the Strike offer. As a result, as provided under the AFSA, each of the D&C Group Shareholders had a further and final 10 day period within which to provide Strike with a counter-offer. The three counter-offers from Ausinca, D&C Group and D&C Pesca were received within this additional 10 day period.

The separate counter-offers from D&C Group and D&C Pesca, on the one hand, and Ausinca, on the other, indicate that those AF shareholders are potentially now acting separately.

Counter-offer details

The Ausinca counter-offer values Strike's shares in AF at approximately US$500; the D&C Group counter-offer values Strike's shares in AF at approximately US$130; while the D&C Pesca counter-offer values Strike's shares in AF at US$27.5 million. The D&C Pesca counter-offer is therefore the successful offer under the shoot-out process.

As the successful bidder under the shoot-out process, D&C Pesca must also repay Strike's loans to AF equal to approximately US$30.7 million. Under a separate finance agreement (AF Financing Agreement), as at 30 September 2012 AF also owes Strike a further US$4.1 million for loans advanced since May 2012. The shootout result brings the date for repayment of this loan forward to 31 December

1 Strike submitted its offer price under the shoot-out process on 3 August 2012. Please refer to Strike's announcement on 6 August 2012. The date for each of the D&C Group Shareholders to accept the Strike offer or submit a counter-offer was extended from 2 October 2012 to 3 October 2012 due to a public holiday in Peru declared on 3 October.

2012, such that the total consideration payable to Strike as a result of the D&C Pesca counter-offer is approximately US$62 million.

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Board recommendation

Under the AFSA, payment of the proceeds from the D&C Pesca counter-offer is due in early November 2012. Strike is in the process of making enquiries to D&C Pesca about its capacity to fund its counteroffer, and to date does not have any written or formal evidence of its ability to meet its obligations under the AFSA. Until such written or formal evidence is provided supporting the financial capacity of D&C Pesca to meet its payment obligations under the AFSA, the Board of Strike recommends that shareholders consider that there remains a substantial completion risk relating to the D&C Pesca counteroffer.

As a consequence, Strike is reviewing its alternatives in the event that D&C Pesca fails to meet its payment obligations.

Strike notes that with respect to any outcome under the shoot-out process, its loans to AF remain secured by a first registered mortgage over AF's mineral concessions.

The Company will continue to update Shareholders on the progress of the settlement process.

For further information:

Malcolm Richmond Ken Hellsten Chairman Managing Director T | +61 8 9324 7100 T | +61 8 9324 7100

ASX Announcement: AF Shootout Results

About Strike Resources Limited

Strike Resources is an Australian-listed resources company with two principal projects in the attractive bulk commodities market.

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Strike's Apurimac and Cusco Iron Ore Projects in Perú are large-scale iron ore projects, with Apurimac in the pre-feasibility study stage. Strike also holds warrants in Canadian-listed Peruvian explorer Cuervo Resources Inc (Cuervo) which, if exercised, would allow it to acquire up to 49% of Cuervo.

The Company is seeking to establish a 15 - 20 million tonne per annum (Mtpa) operation in Perú based on current iron ore mineral resources totalling 374Mt2 and potential access to additional resources of 178.6Mt3 held by Cuervo in Cusco, all with significant exploration upside.

JORC Code Competent Person Statement

The information in this document that relates to exploration results and mineral resources has been compiled by Mr Ken Hellsten, B.Sc. (Geology), who is an employee of Strike Resources Ltd and is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Hellsten has sufficient experience 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 Mineral Resources and Ore Reserves" (the JORC Code). Mr Hellsten consents to the inclusion in this document of the matters based on this information in the form and context in which it appears.

2 Comprised of an indicated resource of 142.2 Mt at 57.84% Fe and an inferred resource of 127 Mt at 56.7% Fe at Apurimac and an inferred resource of 104 Mt at 32.6% Fe at Cusco.

3 Comprised of a measured resource of 19.7 Mt at 48.3% Fe, an indicated resource of 35.9 Mt at 45.9% Fe and an inferred resource of 50.8 Mt at 43.7% Fe at the Orcopura prospect and an inferred resource of 72Mt at 52.6% Fe at the Huillque and Aurora prospects.