TALIUS GROUP LIMITED — Interim / Quarterly Report 2012

Jan 30, 2013

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ADVANCE ENERGY LIMITED ACN 111 823 762

QUARTERLY REPORT 31 DECEMBER 2012

ADVANCE ENERGY LIMITED - QUARTERLY REPORT FOR THE PERIOD ENDING 31 DECEMBER 2012

CORPORATE OVERVIEW

Activities in Ukraine

During the quarter, the Company continued its planning activities on the Ortynytska project in Western Ukraine. This completed the finalisation of the project papers and discussions with potential contractors for the proposed 2D seismic shoot.

Placement and Issue of Shares in lieu of interest

The Company raised $220,000 by issuing 73,333,333 shares at an issue price of $0.003 per share. The Company also issued 38,389,624 shares in lieu of interest that would be payable to the holders of listed convertible notes for the period ending 30 September 2012.

Subsequent Events

Renounceable Rights Issue of Options

Subsequent to the end of the quarter, the Company lodged a Prospectus with ASIC for a 1 for 1 renounceable rights issue of options. The offer will entitle shareholders to apply for options exercisable at 0.4 cents on or before 31 December 2014 at an offer price of $0.001 (0.1 cents) per option. If the offer is fully subscribed, the Company will raise approximately $1.18m which will be used for the development of the Ortynytska project, the acquisition of additional licenses and for working capital.

Anticipated Events

The Company expects to acquire seismic data over the Ortynytska feature from which it will be able to define a reportable resource and complete planning of the re-entry of the Ortynytska -2 well.

For further information contact:

Mr Anthony Short (Managing Director)

Telephone: 08 9429 2900 Facsimile: 08 9486 1011

ADVANCE ENERGY LIMITED Quarterly Report 31 December 2012 ASX CODE: AVD www.advanceenergyltd.com.au

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Appendix 5B Mining exploration entity quarterly report

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001, 01/06/10.

Name of entity

Name of entity
Advance Energy Limited
ABN 62 111 823 762	Quarter ended (“current quarter”)
62 111 823 762	31 December 2012

Consolidated statement of cash flows

Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (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 (12months) $A’000
	- - 3 - (115) - - - - 22	- - (45) - (311) - 4 - - 22
	(90)	(330)
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 (provide details if material) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)	- - - - (71) - -	- - - - (71) - -
	(71)	(71)
	(161)	(401)

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(161)	(401)
Cash flows related to financing activities 1.14 Proceeds from issues of shares and notes 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 (over subs & capital raising expenses) Net financing cash flows	220 - - - - -	553 - - (118) - (13)
	220	422
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 1.22 Cash at end ofquarter	59 60 (19)	21 98 (19)
	101	101

Payments to directors of the entity and associates of the directors Payments to 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 - 1.24 Aggregate amount of loans to the parties included in item 1.10 1.25 Explanation necessary for an understanding of the transactions

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 During the quarter 38,389,624 shares were issued as payment of convertible note interest in the amount of approximately $158,000 due as at 30 September 2012. This also occurred in respect of quarterly interest due on convertible notes as at 31 March 2012 and 30 June 2012. Also during the quarter a debt owed to a consultant in the amount of approximately $120,000 was forgiven.

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

• See chapter 19 for defined terms.

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Appendix 5B Mining 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- line of credit	Amount available $A’000	Amount used $A’000
		-	-
		-	-

Estimated cash outflows for next quarter

$A’000 4.1 Exploration and evaluation 50 4.2 Development - 4.3 Production - 4.4 Administration (including interest) 70 Total 120

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):	101	12
	-	-
	-	-
	-	-
Total: cash at end of quarter(item 1.22)	101	12

Changes in interests in mining tenements

6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased	Tenement reference	Nature of interest (note (2))	Interest at beginning ofquarter	Interest at end of quarter

• See chapter 19 for defined terms.

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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.

	Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note3) (cents)
7.1 Preference +securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases- capital returns, buy- backs or redemptions	9	Unquoted
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases- through issues (b) Decreases- capital returns or buy-backs	1,022,915,843	1,022,915,843		Fully paid
	111,722,957	111,722,957
7.5 +Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases- maturing or conversion of securities	6,675,500	6,675,500	9.5% coupon, expires Dec 2014.
7.7 Options (description and conversion factor) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter
7.11 Debentures (totals only)
7.12 Unsecured notes (totals only)

• See chapter 19 for defined terms.

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Appendix 5B Mining 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 4).

2 This statement does / ~~does not*~~ (delete one) give a true and fair view of the matters disclosed.

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Sign here: ............................................................ Date: ..31 January 2013....... (Director and Company secretary)

Print name: A Jobling

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 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.

5 Accounting Standards ASX will accept, for example, the use of International Accounting 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.

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• See chapter 19 for defined terms.

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