SUREFIRE RESOURCES NL — Interim / Quarterly Report 2012

Mar 14, 2012

BLACK RIDGE MINING NL ABN 48 083 274 024

INTERIM FINANCIAL REPORT 31 DECEMBER 2011

This report should be read conjunction with the Annual Report of the Company for the period ended 30 June 2011

$\mathcal{C}$

BLACK RIDGE MINING NL ABN 48 083 274 024

CONTENTS

CORPORATE DIRECTORY
DIRECTORS' REPORT
AUDITOR'S INDEPENDENCE DECLARATION
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
CONDENSED STATEMENT OF FINANCIAL POSITION
CONDENSED STATEMENT OF CHANGES IN EQUITY
CONDENSED STATEMENT OF CASH FLOWS
NOTES TO FINANCIAL STATEMENTS
DIRECTORS' DECLARATION
INDEPENDENT REVIEW REPORT

CORPORATE DIRECTORY

Board of Directors

Alan Winduss - Non-Executive Chairman Vladimir Nikolaenko -- Non-Executive Director Angus Middleton - Non-Executive Director

Chief Operating Officer

Robert Molkenthin

Company Secretary

David Semmens

Registered Office

Level 1, 47 Ord Street WEST PERTH WA 6005 Telephone: +61 8 9322 7822 Fax: +61 8 9322 7823 Email: info@blackridgemining.com Web: www.blackridgemining.com

Banker

Westpac Banking Corporation 1257 - 1261 Hay Street WEST PERTH WA 6005

Auditors

Rothsav Chartered Accountants Level 18, Central Park Building 152-158 St Georges Terrace PERTH WA 6000 Phone: $+61863645076$

Solicitors

Steinepreis Paganin Level 4, The Read Building 16 Milligan Street PERTH WA 6000 Phone: $+61893214000$ Fax: $+ 61893214333$

Share Registry

Advanced Share Registry 150 Stirling Highway NEDLANDS WA 6009 Phone: +61 8 9389 8033 Fax: $+ 61893897871$

Stock Exchange Listing

Australian Securities Exchange Black Ridge Mining NL ASX Code: BRD, BRDOA

DIRECTORS' REPORT

Your directors submit the financial report of the Company for the half year ended 31 December 2011.

Directors who have held office during or since the end of the half year are:-

Directors of the Company at any time during or since the end of the financial year are:

Alan Winduss	Non-Executive Chairman
Vladimir Nikolaenko	Non-Executive Director
Angus Middleton	Non-Executive Director

Operating Result

As disclosed in the financial statements, the Company recorded a consolidated loss of $576,364 (2010: $624,216) for the half year to 31 December 2011.

Review of Operations

Unaly Hill Vanadiferous Magnetite Project (E57/420)

In November 2011, the Company announced an Inferred Mineral Resource estimate for Unaly Hill (E57/420), Western Australia.

Highlights of the announcement were:

• Significant vanadium Inferred Resource with over 86 million tonnes of 0.42% $V_2O_5$ at a 0.30% cut-off grade
• Confirmation of similar mineralization type to Quest Minerals Limited's (ASX:QNL) Victory $\bullet$ Bore Deposit
• Two significant high-grade zones $\bullet$
• The deposit remains open along strike and depth with strong potential to increase the estimated $\bullet$ resource
• Conceptual study is now underway. $\bullet$

Drilling completed in 2010 targeted titaniferous magnetite mineralisation and a maiden Inferred Mineral Resource revealed significant high grade vanadium mineralisation. The Mineral Resource for the vanadium mineralisation is 86 Mt @ 0.42% $\overline{V}_2O_5$ (Table 1). The Mineral Resource is based on a +0.30% $V2O5$ cut-off.

Significant magnetite iron mineralisation has also been revealed.

Inferred Mineral Resource for $V_2O_5$ % (Oct 2011)
Million tonnel	$V_2O_5%$	Content (Kt)$V_2O_5$	$Fe2O3$ %	Fe $%$	$TiO2$ %	SiO 2 %
86.2	0.42	36,533	24.79	23.57	4.51	30.1

Table 1 Unaly Hill vanadium Inferred Mineral Resource tonnage and grade report

DIRECTORS' REPORT

The Unaly Hill project area is located approximately 48 km south of Sandstone and around 30km ESE of Atlantic Ltd's Windimurra vanadium plant which recently successfully achieved its first ferrovanadium production.

Recent drilling and studies have highlighted excellent vanadium grades associated with the gabbro-hosted magnetite iron mineralisation. There are two main magnetite horizons, with overall strike length of 6 kilometres and widths of 25 to 40 metres and specific gravity of 3.5.

The Unaly Hill vanadium mineralisation occurs within a titaniferous magnetite sequence hosted by the Atley Intrusion. A major 25km long aeromagnetic anomaly is believed to cover this vanadiferous magnetite horizon. A greenstone series about 1 km wide with outcrops occurring over 4 km of strike length are situated immediately to the east of the Atley Intrusion. The vanadiferous magnetite gabbros are weathered to 40m with fresh gabbro passing through 5m of saprorock.

The Youanmi Shear Zone transects the Project area through its centre and could be traced for more than 25km. It forms a prominent ridge along which substantial quantity of quartz have been injected. Although most of the strike of the shear zone is unproductive, there are numerous small-scale workings along its flanks. This vein structure has not yet been systematically prospected for gold and still represents a target.

Aeromagnetic data interpretation of the Unaly Hill Project and the Quest Minerals Limited (ASX:QNL) Victory Bore deposit to the north indicates that the vanadiferous magnetite horizons persist throughout most of the Atley Igneous Complex. Their presence was also confirmed by drilling.

Durminskoe gold and silver project, Far Eastern Russia

Access to the Durminskoe gold and silver project located in Kharbarovski Krai in Far East Russia has been restricted due to inclement weather conditions and temperatures reaching -30°C. No further exploratory work can be conducted until March 2012 when conditions should be more amenable.

Corporate

During the quarter 10,500,000 unlisted options exercisable at $0.10 each and expiring on 31 December 2011 were not exercised by the due date and therefore lapsed.

QUALIFYING STATEMENTS JORC compliance

The information in this report that relates to the drilling data and geological interpretations is based on information compiled by Mr V Trashliev who is a member of the South African Council for Natural Scientific Professions ("SACNASP"). Mr Trashliev is responsible for the Mineral Resource modelling and reporting and is an employee of Gemcom Pty Ltd. The Competent Person responsible for the Independent Audit of the Mineral Resource is Mr Andrew Bewsher from BM Geological Services Pty Ltd and is a member of the Australian Institute of Geoscientists (MAIG). Both persons have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that they are undertaking to qualify as a Competent Persons as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" and do consent to the inclusion in the report of the matters based on information in the form and context in which it appears.

DIRECTORS' REPORT

Auditor's Independence Declaration

The auditor's independence declaration for period ending 31 December 2011 has been given and can be found on page 6 of this report.

Signed in accordance with a resolution of the Board of Directors

flee -

ALAN WINDUSS Director

Signed at Perth on the 15th day of March 2012.

Level 18, Central Park Building, 152-158 St Georges Terrace, Perth WA 6000 P.O. Box 8716, Perth Business Centre WA 6849 Phone (08) 6364 5076 www.rothsay.com.au

The Directors Black Ridge Mining NL Level 1, 47 Ord St West Perth WA 6005

Dear Sirs

In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best of my knowledge and belief there have been:

• no contraventions of the auditor independence requirements of the Act in $\mathsf{i}$ relation to the audit review of the 31 December 2011 interim financial statements; and
• no contraventions of any applicable code of professional conduct in relation $\mathsf{ii}$ to the review.

Graham R Swan (Lead auditor)

Rothsay Chartered Accountants

Dated

15 March 2012

Liability limited by the Accountants Scheme, approved under the Professional Standards Act 1994 (NSW).

CONDENSED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF YEAR ENDED 31 DECEMBER 2011

	Note	31.12.2011	31.12.2010
Other revenue	$\overline{2}$
Financial income	$\overline{2}$	34,521	22,493
Administrative expenses		(431, 421)	(154, 611)
Depreciation and amortisation		(2,662)	(2,000)
Employee expenses		(48,083)	(155, 849)
Exploration expenses		(79,961)	(299, 504)
Finance costs
Occupancy expenses		(48, 758)	(34,745)
Loss before income tax		(576, 364)	(624, 216)
Income tax expense
Loss from continuing operations		(576, 364)	(624, 216)
Other comprehensive income for the period
Total comprehensive loss for the period		(576, 364)	(624, 216)
Earnings per share
Basic earnings per share		(0.08c)	(0.06c)

The company's potential ordinary shares are not considered dilutive and accordingly basic loss per share is the same as diluted loss per share.

The above Condensed Statement of Comprehensive Income should be read in conjunction with the accompanying notes.

CONDENSED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2011

	31.12.2011	30.06.2011
ASSETS
Current Assets
Cash and cash equivalents	1,179,913	2,010,686
Trade and other receivable	71,077	32,525
Other	4,339	10,823
Total Current Assets	1,255,329	2,054,034
Non-current Assets
Property, plant and equipment	13,766	12,952
Exploration expenditure	147,068	147,068
Total Non-current Assets	160,834	160,020
TOTAL ASSETS	1,416,163	2,214,054
LIABILITIES
Current Liabilities
Trade and other payables	16,832	141,822
Short term provisions
Total Current liabilities	16,832	141,822
Non-current liabilities
Total Non-current liabilities
TOTAL LIABILITIES	16,832	141,822
NET ASSETS	1,399,331	2,072,232
EQUITY
Contributed equity	20,339,069	20,435,606
Reserves	223,350	223,350
Accumulated losses	(19, 163, 088)	(18, 586, 724)
TOTAL EQUITY	1,399,331	2,072,232

The above Condensed Statement of Financial Position should be read in conjunction with the accompanying notes.

CONDENSED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2011

	Note	ContributedEquity	AccumulatedLosses	Reserve	Total Equity
Balance at 1 July 2010		17,900,760	(17, 420, 839)	236,750	716,671
Shares issued during the year		1,013,800			1,013,800
Share based paymentsNet loss recognised directly in
equity			(624, 216)		(624, 216)
Shares issue costs		(57, 128)			(57, 128)
Subtotal		18,857,432	(18,045,055)	236,750	1,049,127
Balance at 31 December 2010		18,857,432	(18,045,055)	236,750	1,049,127
Balance at 1 July 2011		20,435,606	(18, 586, 724)	223,350	2,072,232
Shares issued during the year
Share based payments		(6,000)			(6,000)
Net loss recognised directly inequity			(576, 364)		(576, 364)
Shares issue costs		(90, 537)			(90, 537)
Subtotal		20,339,069	(19, 163, 088)	223,350	1,399,331
Balance at 31 December 2011		20,339,069	(19, 163, 088)	223,350	1,399,331

The above Condensed Statement of Changes in Equity should be read in conjunction with the accompanying notes.

CONDENSED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2011

	31.12.2011	31.12.2010
Cash flows from operating activities
Receipts from customers	(43, 586)
Payments to suppliers and employees	(726, 281)	(647, 281)
Interest received	34,521	11,163
Income Tax Paid
Net cash flows provided by/(used in) operatingactivities	(735, 346)	(636, 118)
Cash flows from investing activities
Payment for purchase of property, plant and equipment	(3, 476)
Advances to other entities	(1, 414)
Net Cash flows provided by/(used in) investingactivities	(4,890)
Cash flows provided by/(used in) financing activities
Proceeds from issue of shares		1,013,800
Share issue costs	(90, 537)	(57, 128)
Proceeds from borrowings
Repayment of borrowings
Net cash flows provided by/(used in) financingactivities	(90, 537)	956,672
Net increase in cash and cash equivalents	(830,773)	320,554
Cash and cash equivalents at the beginning of theyear	2,010,686	574,790
Cash and cash equivalents at the end of the year	1,179,913	895,344

The above Condensed Statement of Cash Flows should be read in conjunction with the accompanying notes.

Note 1: Basis of Preparation

These general purpose financial statements for the interim half-year reporting period ended 31 December 2011 have been prepared in accordance with requirements from the Corporations Act 2001 and Australian Accounting Standards including AASB 134: Interim Financial Reporting. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards.

This interim financial report is intended to provide users with an update on the latest annual financial statements Black Ridge Mining NL. As such, it does not contain information that represents relatively significant changes occurring during the half year. It is therefore recommended that this financial report be read in conjunction with the annual financial statements for the year ended 30 June 2011, together with any public announcements made during the half year.

The same accounting policies and methods of computation have been followed in this interim financial report as were applied in the most recent annual financial statements except for the adoption of the following new and revised Accounting Standards.

New Accounting Standards and Interpretations

Since 1 July 2011 the Company has adopted all Australian Accounting Standards and Interpretations mandatory for reporting periods beginning on or after 1 July 2011, including:

• AASB 124 (Revised) Related Party Disclosures $\bullet$
• AASB 2009-12 Amendments to Australian Accounting Standards [AASB 5, 8, 108, 110, 112, 119, $\bullet$ 133, 137, 139, 1023 & 1031 and Interpretations 2, 4, 16, 1039 & 1052]
• AASB 2009-14 Amendments to Australian Interpretation Prepayments of a Minimum Funding $\bullet$ Requirement
• AASB 1054 Australian Additional Disclosures
• AASB 2010-4 Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project [AASB 1, 7, 101, 134 and Interpretation 13]
• AASB 2010-5 Amendments to Australian Accounting Standards [AASB 1, 3, 4, 5, 101, 107, 112, 118, 119, 121, 132, 133, 134, 137, 139, 140, 1023 & 1038 and Interpretations 112, 115, 127, 132 & 10421
• AASB 2010-6 Amendments to Australian Accounting Standards Disclosures on Transfer of Financial Assets [AASB 1 & 7]

The Company has not elected to early adopt any new standards or amendments.

Going concern

The financial report has been prepared on a going concern basis, which contemplates the continuity of the normal business activities and the realisation of assets and settlement of liabilities in the normal course of business.

For the half year ended 31 December 2011 the entity incurred a loss of $576,364 and an operating cash outflow of $735,346. If the Company is unable to continue as a going concern, then it may be required to realise its assets and extinguish its liabilities, other than in the normal course of business, and at different amounts from those stated in the financial report. The Directors hold the view that Black Ridge Mining NL has adequate cash reserves, funding opportunities and prospects to allow it to pay its debts as and when they fall due, and thus the Directors believe that it is appropriate to prepare the financial report on a going concern basis

	31.12.2011	31.12.2010S
Note 2: Revenue and Other Income
Finance Income	34,521	22,493
Other Income
Total income from ordinary activities	34,521	22,493

Note 3: Dividends

No dividends were paid or proposed during the half year ended 31 December 2011.

Note 4: Operating Segments

The Company operates in predominantly in one business and geographical segment, being mineral exploration in Australia.

	Mining &
Six months ended 31 December 2011	Exploration	Corporate	Consolidated
	$	S	$
REVENUE
Other revenue		34,521	34,521
Segment Result	(79, 961)	(496, 403)	(576, 364)
ASSETS / LIABILITIES
Asset
Segments Assets	147,068	1,269,095	1,416,163
Liabilities
Segment liabilities		(16, 832)	(16, 832)
Net Assets	147,068	1,252,263	1,399,331

	Mining $&$
Six months ended 31 December 2010	Exploration	Corporate	Consolidated
	$	S	$
REVENUE
Other revenue		22,493	22,493
Segment Result	(299, 504)	(324, 712)	(624, 216)
ASSETS / LIABILITIES
Asset
Segments Assets	147,068	950,031	1,097,099
Liabilities
Segment liabilities		(47, 972)	(47, 972)
Net Assets	147,068	902,059	1,049,127

Note 5: Events after the End of the Interim Period

On 2 March 2012, the Company announced it had signed a Heads of Agreement to develop a licenced Rare Earths project located in the Tuv Province, 80 kms east of Ulaanbaatar, the capital and largest city in Mongolia. The Heads of Agreement allows for a 120 day due diligence period, during which time the Company will seek to finalise a definitive agreement in which to jointly develop the project in which the Company will have the right to earn up to 80% in the project.

An introductory fee of 10,000,000 fully paid ordinary shares in the Company will be issued to an unrelated party.

Samples assayed in mid-2011 confirmed encouraging concentrations of lanthanum, scandium, yttrium, cerium and other elements.

This is a significant investment opportunity and previous samples indicated not only rare earth elements but, potentially, vanadium, tungsten, chrome and scandium, complementing the Company's Unaly Hill vanadium project in Western Australia. This agreement has the potential to add a new tenement to the Company's portfolio and underpins its core strategy to identify and develop significant opportunities, close to existing infrastructure, that will meet current and future resource demands.

The Company will be commencing due diligence as soon as is practicable and, as part of this exercise, has engaged a qualified geologist to visit Mongolia to conduct technical due diligence encompassing confirmation of all reported exploration workings (pits, trenches and DD collars sites). Rock-chip samples will be collected at all relevant sites to confirm historically reported grades of rare earth minerals in addition to vanadium, tungsten, chrome, scandium, among others.

There have been no other matters or circumstances that have arisen since 31 December 2011 that has significantly affected or may significantly affect:

• The economic entity's operation in future years; or $\bullet$
• The results of those operations in future years; or $\bullet$
• The economic entity's state of affairs in future years. $\bullet$

Note 6: Related Party Disclosures

Administration Services Agreement

Corporate Admin Services Pty Ltd

The Company has an administration services agreement with Corporate Admin Services Pty Ltd, which Mr. Vladimir Nikolaenko is director and shareholder of the Company. The contract is for provision of strategic and corporate advisory services. The amount paid to Corporate Admin Services Pty Ltd at 31 December 2011 is $238,505.

Commercial Services Agreement $\blacksquare$

Winduss & Associates Pty Ltd

The Company receives accounting and secretarial services from Winduss & Associates Pty Ltd, an accounting practice of which Mr Winduss is a director and shareholder. Fees charged are at normal commercial rates and conditions. Winduss & Associates Pty Ltd has provided accounting services during the period in the amount of $24,312.

Acquisition of Mining Tenement - Additional Consideration

Plato Mining Pty Ltd

In 2009, the Company acquired the Unaly Hill Tenement (E57/420) from Plato Mining Pty Ltd, a company of which Mr Vladimir Nikolaenko is a Director. Upon the establishment of a JORC Code compliant inferred resource, indicated resource or measured resource on the Tenement, additional consideration will become payable to Plato Mining Pty Ltd.

Note 7: Contingent Liabilities

The Company has a contingent liability in relation to additional consideration for the acquisition of the Unaly Hill mining tenement E57/420:

Upon establishment of an inferred, indicated or measured resource, further payments must be $\bullet$ made to the vendor based on mineral ore tonnages identified.

• i) Where the resource relates to iron ore, vanadium or phosphate inferred resource $0.02 per tonne of ore, indicated resource $0.04 per tonne of ore and measured resource $0.06 per tonne of ore.
• ii) Where the resource relates to $U_3O_8$ or any base metal inferred resource $0.05 per tonne of ore, indicated resource $0.08 per tonne of ore and measured resource $0.10 per tonne of ore.
• iii) Where the resource relates to gold or any other precious metal inferred resource $0.20 per tonne of ore, indicated resource $0.30 per tonne of ore and measured resource $0.50 per tonne of ore.
• A royalty equal to 2.25% of gross revenue arising from sale of minerals derived from the tenement.

DIRECTORS' DECLARATION

The directors of the Company declare that:

• 1. The financial statements and notes, as set out on pages 7 to 17:
  • Comply with Accounting Standard AASB 134 Interim Financial Reporting and the a. Corporations Regulations and
  • Give a true and fair view of the economic entity's financial position as at 31 December $b$ . 2011 of its performance for the half-year ended on that date.
• $2.$ In the directors' opinion there are reasonable grounds to believe that the company will be able to pay its debts when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors.

ff be

ALAN WINDUSS Director

Dated this 15th day of March 2012

Level 18, Central Park Building, 152-158 St Georges Terrace, Perth WA 6000 P.O. Box 8716, Perth Business Centre WA 6849 Phone (08) 6364 5076 www.rothsay.com.au

Independent Review Report to the Members of Black Ridge Mining NL

The financial report and directors' responsibility

The interim consolidated financial report comprises the statement of financial position, statement of comprehensive income, statement of changes in equity, cashflow statement, accompanying notes to the financial statements, and the directors' declaration for Black Ridge Mining NL for the half-year ended 31 December 2011.

The Company's directors are responsible for the preparation and fair presentation of the consolidated financial report in accordance with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001. This includes responsibility for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial report.

Review approach

We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of an Interim Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the interim consolidated financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated financial position as at 31 December 2011 and the performance for the half year ended on that date; and complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001. As auditor of Black Ridge Mining NL, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of an interim financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly we do not express an audit opinion.

Independence

In conducting our review we have complied with the independence requirements of the Corporations Act 2001.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the interim consolidated financial report of Black Ridge Mining NL is not in accordance with the Corporations Act 2001, including:

• giving a true and fair view of the consolidated financial position as at 31 December 2011 and of the $\bullet$ performance for the half-year ended on that date; and
• complying with Australian Accounting Standard AASB134 Interim Financial Reporting and the Corporations Regulations 2001.

$K_0H$ say

Graham R Swan Partner

Liability limited by the Accountants Scheme, approved under the Professional Standards Act 1994 (NSW).