SUNSTONE METALS LTD — Capital/Financing Update 2012

Jul 5, 2012

ASX: AVI

6 July 2012

AVALON SUPPORT CONTINUES AS IT RAISES $3.6M TO PROGRESS THE VISCARIA PROJECT IN SWEDEN

Highlights

• Placement arranged to raise A$3.6 million (before costs) at a price of 9 cents per share.

• Proceeds from the equity raising will be applied to the following activities at Avalon’s Viscaria Copper Project in northern Sweden:

  • commence a regional exploration program;

  • completing a scoping study currently underway to determine the economics of a combined open pit and underground mining operation;

  • complete planning for a major resource extension drill program; and

  • replenish the Company’s working capital.

Details

The Board of Avalon Minerals Ltd (ASX: “ AVI”) and (“Avalon” ) is pleased to announce that it has arranged a placement to raise $3.6 million (before costs) to support the continued exploration and development of its flagship Viscaria Copper Project in northern Sweden.

Avalon’s Managing Director, Jeremy Read said, “I am delighted with the success of this placement to raise a total of A$3.6 million to progress the Viscaria Project. This placement confirms the strong financial support Avalon continues to receive for this project and for its new management team. We look forward to making significant progress with the proceeds raised.”

Patersons Securities Limited (“ Patersons ”) acted as Lead Manager- Australia and RFC Ambrian Limited (“ Ambrian ”) acted as Lead Manager- United Kingdom. The placement shares will be issued to professional and sophisticated clients of Patersons and Indian Ocean Capital in Australia and of Ambrian in the United Kingdom, as well as to investors introduced by the Company.

Use of Proceeds

Proceeds from the equity raising will be used to advance the Viscaria Project in Sweden including the commencement of a regional exploration program; completing a scoping study to determine the economics of an open pit and underground mining operation; completion of planning for a major resource extension drill program; and replenishment of Avalon’s working capital.

This announcement will now bring to an end the current trading halt.

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For further information please visit www.avalonminerals.com.au or contact

Mr Jeremy Read - Managing Director Avalon Minerals Limited Tel: 07 3368 9888 Em: jeremy.read@avalonminerals.com.au www.twitter.com/avalonminerals

Mr James Harris Professional Public Relations Tel: 08 9388 0944 Mob: 0400 296 547 Em: james.harris@ppr.com.au

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