TUNGSTEN MINING NL — Interim / Quarterly Report 2015

Jan 28, 2016

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Quarterly Report – December 2015

Highlights

Major Asset Acquisition

• In October TGN announced that it had agreed terms for the acquisition of the Australian tungsten exploration assets of Hazelwood Resources Ltd (ASX: HAZ) comprising the Mt Mulgine and Big Hill tungsten assets (“Projects”).

• The Mt Mulgine and Big Hill Projects together represent a tungsten resource inventory of 88.2 Million tonnes at 0.17% WO3, representing more than 15 million MTU (metric tonne units) of WO3.

• TGN paid $1,000,000 and issued 5,000,000 fully paid ordinary shares as consideration for the purchase of the Projects upon completion in December 2015.

• Funding for completion of the acquisition was provided by way of loan by associated entity, GWR Group Ltd pursuant to the terms of a Funding Deed. GWR has a substantial shareholding (16.4%) in TGN and assisted with the acquisition by funding the cash requirement of the consideration for the asset purchase.

• TGN now controls an aggregate tungsten resource inventory of 93 Million tonnes at 0.18% WO3, representing more than 16.5 million MTU (metric tonne units) of WO3, providing the platform for TGN to become a globally significant player within the primary tungsten market.

• Since completion of the acquisition work has focused on consolidating geological, metallurgical and associated project information, validating and updating databases and planning future exploration and development activities.

• TGN are conducting a review of the existing JORC 2004 Mineral Resource at Big Hill with the objective of publishing a JORC 2012 compliant Mineral Resource estimate. Similar work is planned to follow on the existing Mulgine Hill Resource Estimate, also prepared under JORC 2004.

Kilba Project, Ashburton Region, Western Australia

• Soil sampling of regional targets at Kilba defined anomalous tungsten to 400 ppm W associated with skarns and calc-silicates warranting further investigation.

Corporate

• $1.92m was raised by way of private placement with an allotment of 48,000,000 fully paid ordinary shares on 15 January 2016 to sophisticated and institutional investors at a price of 4 cents per share.

Tungsten Mining NL Quarterly Activities Report December 2015

Major Project Acquisition

Tungsten Mining NL (ASX:TGN) (“the Company”) announced on 26 October 2015 that it had agreed terms for the acquisition of the Australian tungsten exploration assets of Hazelwood Resources Ltd (“Hazelwood”) comprising the Mt Mulgine and Big Hill tungsten assets (“Projects”).

The Hazelwood Projects include the 100%-owned Big Hill project, located in the East Pilbara of Western Australia which hosts a Measured, Indicated and Inferred Mineral Resource. Hazelwood have reported that pilotscale test-work has shown excellent processing characteristics producing high-quality tungsten concentrate.

The 100%-owned Big Hill project, located in the East Pilbara of Western Australia hosts a Measured & Indicated Mineral Resource. The Mt Mulgine project comprises 100% of the tungsten and molybdenum rights on a group of tenements located 350km NNE of Perth, Western Australia. The Mt Mulgine Project has been subject to significant previous evaluation. Two near surface Mineral Resources have been validated at Mt Mulgine, the Mulgine Hill Deposit and Mulgine Trench Deposit. The Mulgine Trench project continues to grow since the maiden Resource estimate announced in April 2014.

The Mt Mulgine and Big Hill Projects together represent a tungsten resource inventory of 88.2 Million tonnes at 0.17% WO3, representing more than 15 million MTU (metric tonne units) of WO3 (refer page 3). Further details on the Mineral Resource of the Projects and the individual projects can be found in the June Quarterly Report of Hazelwood released to ASX on 31 July 2015 (an extract of which is set out at Table 1).

Following completion of due diligence and execution of formal documentation during November 2015, the transaction was settled on 14 December 2015. Consideration for the purchase was the cash sum of $1,000,000 and the issue of 5,000,000 fully paid ordinary shares in TGN (“Consideration Shares”). The Consideration Shares are subject to a 12 month voluntary escrow period.

The transaction represents a significant milestone in the relatively brief history of Tungsten Mining NL. The acquisition, achieved at a low point in the commodity cycle, provides substantial upside and the platform upon which to build a business of scale and become a significant player within the tungsten industry.

Funding Deed

Funding for settlement of the transaction has been provided by associated entity, GWR Group Ltd (“GWR”). As set out in the announcement dated 26 October 2015, GWR has a substantial shareholding (16.4%) in TGN and agreed to assist by offering to fund the cash requirement of the purchase consideration. TGN and GWR have entered into a Funding Deed (“Deed”). The Deed provides for GWR to advance the Principal amount of $1,000,000 by way of unsecured loan (Loan”). The Loan is repayable:

• out of proceeds of any future entitlements issue by TGN to the extent of GWR’s subscription to the entitlements issue;

• by GWR subscribing to Convertible Notes in TGN subject to TGN shareholder approval; or

• in cash for any amount remaining outstanding on the Maturity Date (11 December 2016).

In the event GWR subscribes for Convertible Notes to be issued by TGN the Convertible Notes will be on the following terms:

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Tungsten Mining NL Quarterly Activities Report December 2015

• a face value of $1,000,000 (less any amount of the Loan repaid prior to the issue of the Convertible Notes);

• Interest to apply at the rate of 12%pa payable quarterly in arrears (as is the case with the Loan);

• Repayable on the Maturity Date (11 December 2016); and

• Conversion into fully paid ordinary shares in TGN (“Shares”) at the election of GWR at any time prior to the Maturity Date at a share price of the lesser of:

• 4 cents per Share;

• the 30 day VWAP for Shares immediately prior to receipt of a Conversion Notice; or

• the most recent issue price of Shares to raise at least $1,000,000 prior to receipt of a Conversion Notice.

Under the Deed, if TGN does not obtain the requisite shareholder approval (for ASX Listing Rule and Corporations Act purposes) within 60 days of a request from GWR for TGN to seek shareholder approval the Loan shall become payable on demand.

Exploration and Development Activity

Following settlement of the acquisition of the Mt Mulgine and Big Hill projects in mid-December, work has commenced on tenement administration, data consolidation/validation and forward planning of future activities.

TGN are conducting a review of the existing JORC 2004 Mineral Resource at Big Hill with the objective of publishing a JORC 2012 compliant resource estimate. This process involves validation of the drill database, QAQC checks and confirmation of geological interpretations. External consultants have been assisting TGN with developing the Big Hill tungsten deposit Mineral Resource to the standards required by the 2012 JORC Code.

The existing JORC 2004 Mineral Resource estimate for Mulgine Hill, a component of the Mt Mulgine project, is also planned for future review. This will be undertaken in conjunction with activities directed at upgrading the existing JORC 2012 Mineral Resource estimate for the Trench deposit at Mt Mulgine. Defining the scope of work and timing of these activities will be progressed in the current quarter as project plans are refined and prioritised.

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Tungsten Mining NL Quarterly Activities Report December 2015

Extract from the June 2015 Quarterly Report of Hazelwood Resources Ltd

Table 1 Hazelwood Resources Ltd - Tungsten Resources[1] at 0.1% WO3 cut-off

	The Trench (Mt Mulgine) JORC 2012 compliant	The Trench (Mt Mulgine) JORC 2012 compliant	The Trench (Mt Mulgine) JORC 2012 compliant
Category	Million Tonnes	% WO3	MTU (Metric tonne units) WO3	Contained tungsten W (tonnes)
Indicated	0.4	0.14	50,000	400
Inferred	63.4	0.17	11,050,000	87,600
	Mulgine Hill (Mt Mulgine) JORC 2004 compliant
	Million Tonnes	% WO3	MTU WO3	Contained tungsten W (tonnes)
Indicated	5.9	0.22	1,300,000	10,300
Inferred	2.3	0.17	400,000	3,200
	Big Hill (Pilbara) JORC 2004 compliant
	Million Tonnes	% WO3	MTU WO3	Contained tungsten W (tonnes)
Measured	9.5	0.16	1,540,000	12,200
Indicated	4.5	0.16	700,000	5,600
Inferred	2.2	0.14	300,000	2,400
	Total Tungsten Mineral Resource
	Million Tonnes	% WO3	MTU WO3	Contained tungsten W (tonnes)2
**Total **	88.2	0.17	15,347,000	121,700

1 Refer ASX (HAZ) Announcement 5 November 2014, “Hazelwood continues to increase tungsten resource” 2 Note that 121,700 tonnes of contained tungsten (W) equates to 153,470 tonnes of contained tungsten trioxide (WO3).

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Tungsten Mining NL Quarterly Activities Report December 2015

Kilba Project

The Kilba Project is located in the Ashburton Region of Western Australia. During second half of 2014, the Company completed infill drilling at Zone 8 and Zone 11 and have drilled a total of 158 reverse circulation (RC) and 37 diamond holes for 17,172 metres at the Kilba Project (Figure 1).

Figure 1 – plan displaying location of recent drilling and Mineral Resource at the Kilba Project

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In May 2013, the Company announced a Maiden Indicated and Inferred Mineral Resource at Zone 8 and Zone 11 of the Kilba project (ASX announcement; 31 May 2013). During the second half of 2014, the Company completed a phased drilling program to increasing the confidence level of the Kilba Mineral Resource at Zones 8 and 11 to an Indicated status in support of future detailed feasibility studies. Drilling infilled sections to a 40 metre spacing over the entire May 2013 Mineral Resource.

Mineral Resource

In January 2015, the Company announce an updated JORC 2012 Indicated and Inferred Mineral Resource of 5.0 million tonnes at 0.24% WO3 at Zones 8, 11 and 12 of the Kilba Project (Refer to Table 1). The Mineral Resource estimate has been completed by CSA Global Pty Ltd in accordance with the guidelines of the Joint Ore Reserve Committee (JORC) Code – 2012 Edition (refer to ASX announcement; 30 January 2015). The Mineral Resource is located on the Company’s 100%-owned Mining Lease 08/314 situated in the Ashburton Region of Western Australia.

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Tungsten Mining NL Quarterly Activities Report December 2015

Table 1: Kilba Mineral Resource estimate based on a 0.10% WO3 cut‐off grade.

Prospect	Class	Tonnes	WO3	WO3
		'000 t	%	t
Zone 8	Indicated	540	0.27	1,500
	Inferred	150	0.31	500
	Total	700	0.28	1,900
Zone 11	Indicated	3,600	0.25	9,000
	Inferred	460	0.19	900
	Total	4,000	0.24	9,800
Zone 12	Inferred	230	0.15	400
	Total	230	0.15	400
Total	Indicated	4,100	0.25	10,400
	Inferred	830	0.20	1,700
	Total	5,000	0.24	12,100

Note: Totals may differ from sum of individual numbers as numbers have been rounded to two significant figures in accordance with the Australian JORC code 2012 guidance on Mineral Resource reporting.

Metallurgical Testwork

A phase 2 investigative metallurgical test work program commenced in November 2014 and was completed at Nagrom’s Test Laboratory in June 2015. The program built on the findings and recommendations of the phase 1 test program (undertaken by Mintrex Pty Ltd in 2013), in particular to further investigate the potential of a prescalping stage to remove a significant proportion of the feed mass as waste prior to beneficiation. The remainder of the program was to determine the amenability of the sample to upgrading the WO3 content using gravity, magnetic characterisation and flotation test work. Detailed results of the program were set out in the June 2015 activities report.

In summary, the phase 2 program results were as follows:

• The continuous dense media separation (DMS) test circuit was successful in removing 19% of the feed mass for a loss of only 1% WO3.

• Subsequent beneficiation test work upgraded the WO3 from a calculated head grade of 0.3% to 70.6%, with an overall circuit recovery rate of 37%. Magnetic separation has shown to be an effective method for cleaning this gravity concentrate, with high intensity magnetic separation increasing the gravity concentrate grade from 58.9% to 76.6% WO3 at a recovery of 96.5% within that circuit.

• Middlings flotation test work, directed at improving WO3 yield, produced a WO3 recovery >90%, however the grade was well below expectations. It is suspected that insufficient WO3 liberation is the cause of the poor grade. Future metallurgical test work programs will invest in mineralogical analysis of the middlings and tailings streams to better understand the minerals present and particle liberation size in order to improve yield and optimise the process flow sheet.

Other Studies

During 2015 TGN completed pit shape optimisations using Whittle software, to assess the viability of the Kilba Project using the updated Kilba mineral resource and other economic input factors. The Whittle optimisation results generated positive outcomes for all scenarios investigated.

Upon completion of the optimisations, preliminary design work was undertaken on a number of project elements. Pit parameters have been explored, allowing mining pit and waste dump designs. Site infrastructure layout options have also been investigated, with infrastructure specialists visiting the Kilba site in June 2015, assisting in

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Tungsten Mining NL Quarterly Activities Report December 2015

layout design options. This information and previously completed studies, including flora and fauna surveys, support ongoing consultation with regulatory bodies.

No additional study work was undertaken on the Kilba project during the December quarter.

Regional Targets

A review of historical data indicates that stream sediment sampling conducted by ANZECO in 1973 defined a number of targets that surrounds Kilba. Geological mapping of these targets was completed in September Quarter locating favourable lithologies (i.e. calc-silicate units, marbles and skarns) over considerable strike lengths. From UV lamping scheelite mineralisation within these units was considered to be generally narrow.

A small soil sampling programme totalling 339 samples was completed across six of these targets in October 2015. Results from this work defined anomalous tungsten to 400 ppm W associated with skarns and calcsilicates at three of these targets warranting further investigation in the form of follow-up soil sampling and drill testing.

Koolyanobbing Project – Seabrook Rare Metals Venture

In November 2014, Tungsten Mining entered into a binding agreement with Lithium Australia NL (ASX:LIT) that provides for LIT to explore for lithium and other metals, on the shores of Lake Seabrook, approximately 60km north-east of Southern Cross, Western Australia. The agreement concerns tenements comprising Tungsten Mining’s Koolyanobbing Project, and extends to an area of influence of 20km outside of the Tungsten Mining Tenements. The Seabrook Rare Metals Venture provides LIT with a right to earn an 80% interest to all metals other than tungsten, the right of which remain or are vested in Tungsten Mining.

No work was undertaken on the Seabrook Rare Metals Joint Venture during the December 2015 Quarter. Previously LIT identified an area of high prospectivity for pegmatites of the lithium, caesium, and tantalum class, which is about 3km long and 500 - 600m wide, remains open across the Koolyanobbing Shear, transgressing the boundary between a sequence of mafic and acid lithologies.

Corporate

$1.92m was raised by way of private placement with an allotment of 48,000,000 fully paid ordinary shares on 15 January 2016 to sophisticated and institutional investors at a price of 4 cents per share (“Placement”).

The Placement was undertaken to fund working capital and the Company’s project development activities following the earlier settlement of the acquisition of the Mt Mulgine and Big Hill tungsten projects from Hazelwood Resources Limited.

Cash at bank and on deposit at the end of December 2015 has been reported as an amount of $0.277m. This balance does not include Placement monies received and held in the Company’s share application account of $1.677m as at 31 December 2015. Under Australian accounting standards such amounts are classified as “other financial assets” until such time as the relevant securities have been allotted (15 January 2015).

The Placement was made in accordance with the company's placement capacity under ASX Listing Rule 7.1 and 7.1A.

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Tungsten Mining NL Quarterly Activities Report December 2015

Tenement Summary

			Interest acquired/
		Interest held at		Interest Held at
Tenement Name	Tenement	30 Sep 2015	disposed of during	31 Dec 2015
			quarter
Whiskey Pool	E08/1812	100%	N/A	100%
Moodong Well	E08/2139	100%	N/A	100%
Loves Find	E08/2207	100%	N/A	100%
Loves Find	M08/286	100%	N/A	100%
Loves Find	M08/287	100%	N/A	100%
Kilba Well	M08/314	100%	N/A	100%
Green Gate Granite	M08/493	100%	N/A	100%
Green Gate Granite	L08/82	100%	N/A	100%
Green Gate Granite	L08/83	100%	N/A	100%
Green Gate Granite	L08/84	100%	N/A	100%
Mt Murray 2	E08/2641	100%	N/A	100%
Koolyanobbing	E77/1853	100% mineral rights for tungsten, 20% for other commodities	N/A	100% mineral rights for tungsten, 20% for other commodities
Koolyanobbing	E77/1854	“	N/A	“
Koolyanobbing	E77/1855	“	N/A	“
Koolyanobbing	E77/2021	“	N/A	“
Koolyanobbing	E77/2022	“	N/A	“
Koolyanobbing	E77/2035	“	N/A	“
Koolyanobbing	E77/2279	Nil	Tenement Granted	“
Callie Soak	E20/854	PENDING	N/A	PENDING
Mt Mulgine**	E59/1324	Nil	100% mineral rights for tungsten and molybdenum	100% mineral rights for tungsten and molybdenum
Mt Mulgine	M59/386	Nil	“	“
Mt Mulgine	M59/387	Nil	“	“
Mt Mulgine	M59/425	Nil	“	“
Mt Mulgine	P59/1785	Nil	“	“
Mt Mulgine	P59/1786	Nil	“	“
Mt Mulgine	P59/1788	Nil	“	“
Mt Mulgine	P59/1789	Nil	“	“
Big Hill**	E46/521	Nil	100 interest in the tenement%	100%
Big Hill	E46/692	Nil	“	100%
Big Hill	E46/940	Nil	“	100%
Big Hill	L46/70	Nil	“	100%
Big Hill	M46/514	Nil	“	100%

• This tenement was granted during the quarter and is held by Lithium Australia NL and subject to the terms of the Seabrook Rare Metals Venture - TGN entitled to an interest in 100% of the tungsten rights and 20% for all other commodities.

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Tungsten Mining NL Quarterly Activities Report December 2015

**Big Hill tenements and Mt Mulgine mineral rights acquired pursuant to Sale of Mining Interests Agreement between TGN, Hazelwood Resources Ltd, Big Hill Resources Ltd and others and dated 3 December 2015. Big Hill project tenements remain registered in the name of Hazelwood Resources Ltd and Bighill Resources Ltd pending registration of the tenement transfers by the Department of Mines and Petroleum.

Competent Person’s Statement

The information in this report that relates to Exploration Targets and Exploration Results is based on, and fairly represents, information and supporting documentation prepared by Peter Bleakley, who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Bleakley is not a full-time employee of the company. Mr Bleakley is a consultant to the mining industry. Mr Bleakley has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Bleakley consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Where the Company refers to the Kilba Resource Upgrade referencing the release made to the ASX on 30 January 2015 it confirms that it is not aware of any new information or data that materially affects the information included in that announcement and all material assumptions and technical parameters underpinning the resource estimate with that announcement continue to apply and have not materially changed.

For further information: Craig Ferrier Chief Executive Officer Ph: +61 8 9486 8492

E: craig.ferrier@tungstenmining.com

For Broker and Media Enquiries: Warrick Hazeldine / Andrew Rowell Cannings Purple Ph: +61 417 944 616 / +61 400 466 226 E: whazeldine@canningspurple.com.au / arowell@canningspurple.com.au

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Tungsten Mining NL Quarterly Activities Report December 2015

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

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

Name of entity
Tungsten Mining NL
ABN 67 152 084 403	Quarter ended (“current quarter”)
67 152 084 403	31 December 2015

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 (R&D tax offset) Net Operating Cash Flows	Current quarter $A’000	Year to date (6 months) $A’000
	- (119) - - (180) - 1 - - 26	- (211) - - (317) - 4 - - 26
	(272)	(498)
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)	(1,019) - - - - 18 - -	(1,019) - - - - 18 - - -
	(1,001)	(1,001)
	(1,273)	(1,499)

• See chapter 19 for defined terms.

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

1.13 Total operating and investing cash flows (brought forward)	(1,273)	(1,499)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 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 (provide details if material) Net financing cash flows	- - 1,000 - - -	- - 1,000 - - -
	1,000	1,000
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(refer note 6)	(273) 550 -	(499) 776 -
	277	277

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

1.23 1.24	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
		40
		-
1.25	Explanation necessaryforanunderstanding of thetransactions

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

• See chapter 19 for defined terms.

Appendix 5B Page 2

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

• 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

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	1,000	1,000
	-	-

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	215
	-
	-
	150
Total	365

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)	277	550
	-	-
	-	-
	-	-
Total: cash at end of quarter(item 1.22)	277	550

• See chapter 19 for defined terms.

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

Changes in interests in mining tenements and petroleum tenements

6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements and petroleum tenements acquired or increased	Tenement reference and location	Nature of interest (note (2))	Interest at beginning of quarter	Interest at end of quarter
	E59/1324-I M59/386-I M59/387-I M59/425-I P59/1785-I P59/1786-I P59/1788-I P59/1789-I E46/521-I E46/692-I E46/940 L46/70	Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition of Tungsten Rights Acquisition Acquisition Acquisition Acquisition	0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%	100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

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.

dates.
	Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note 3) (cents)
7.1 Preference +securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs, redemptions
7.3 +Ordinary securities	217,652,708	217,652,708

• See chapter 19 for defined terms.

Appendix 5B Page 4

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs	5,000,000	5,000,000	4 cents each	4 cents each
7.5 +Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7 Options (description and conversion factor) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter	15,000,000		Exercise price $0.400	Expiry date 30 Jun 2016
	1,800,000		$0.250	4 Dec 2015
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.

Sign here:

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Date: 29 January 2016

Print name: Mr Craig Ferrier CEO

• See chapter 19 for defined terms.

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

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 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.

• 6 Cash at bank and on deposit at the end of December 2015 has been reported as an amount of $0.277m. This balance does not include Placement monies received and held in the Company’s share application account of $1.677m as at 31 December 2015. Under Australian accounting standards such amounts are classified as “other financial assets” until such time as the relevant securities have been allotted (15 January 2015).

== == == == ==

• See chapter 19 for defined terms.

Appendix 5B Page 6

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