VRX SILICA LIMITED — Interim / Quarterly Report 2011

Jan 26, 2012

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December Quarter 2011 Activity Report

HIGHLIGHTS

Thaduna/Green Dragon:

• Third phase of drilling at Thaduna commenced 11 October 2011 and completed December 2011

• Broad intersections of primary chalcopyrite mineralisation in 3 holes at the Thaduna prospect

• THRC054 intersected 142 metres of mineralisation including 97 metres of visible chalcopyrite which terminated in mineralisation

• Intersections are below the predicted footwall and holes ended in mineralisation

• Copper mineralisation is visible and confirmed with hand held portable XRF

• Second rig on site to extend RC holes ending in mineralisation with diamond drilling

Warrawanda:

• Drilling has confirmed a massive ultramafic east-west intrusion more than 15 kilometres long, up to 400 metres wide and open at depth

• The intrusion is largely a uniform high magnesium ultramafic with associated low grade (~0.2%) nickel background values

• Elevated grades in WWRC013 up to 0.50% nickel, over 4 metres, with coincident iron and sulphur suggest a potential for Mt Keith style mineralisation

• Elevated nickel grades in WWRC009 up to 0.58%, over 4 metres, with coincident iron and cobalt suggest a potential for magnetite hosted Indian style nickel cobalt mineralisation

• Mineralogy work underway to define the nature of potential mineralised zones

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Thaduna/Green Dragon

In October 2011 Ventnor commenced the third phase of drilling at its Thaduna/Green Dragon copper project to drill both prospects.

The drilling program was to extend and infill previously identified mineralisation beneath existing mined pits at both the Thaduna and Green Dragon prospects to a nominal 200 metre depth.

A total of 134 RC drillholes for 17,910 metres and 2 diamond drillholes for 320 metres were drilled at the two prospects from 10 October and 15 December 2011 with results from 85 drillholes outstanding at the end of the quarter.

Subsequent to the Period

Outstanding copper assay results from the Phase 3 program were received and announced 24 January 2012. Results included:

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• 37 metres at 2.61% Cu from 111 metres (THRC113)

• including 10 metres at 7.53% Cu from 134 metres downhole;

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• 62 metres at 2.19% Cu from 125 metres (THRC114)

• including 32 metres at 3.10% Cu from 127 metres downhole and

• ended in mineralisation, 3.70% Cu at EOH, to be extended by diamond drilling

A total of 127 holes for 15,888m have now been completed at Thaduna over the three phases of drilling in 2011. Holes have been completed both underneath and north of the historic Thaduna Pit, see Figure 1. Drilling during the Phase 3 program concentrated north of the Thaduna pit where the targets are shallower and were better suited for the smaller RC rig. Towards the end of the year, a second larger multi-purpose rig was mobilised to site and commenced drilling deeper RC holes at Green Dragon as well as completing two NQ2 diamond tails on THRC054 and THRC057 at Thaduna, reported 22 December 2011.

Hole Id	Northing	Easting	Az	Dip	From	To	DH m	Cu%	Ag ppm
THRC113	7176206	772615	60 Incl. Incl. Incl. Incl.	-60	96 97 111 115 122 134	103 99 148 119 124 144	7 2 37 4 2 10	0.95 1.92 2.61 2.52 1.04 7.53	1.15 3.00 6.38 5.25 2.00 19.90
THRC114	7176278	772576	60 Incl. Incl.	-60	125 127 170	187 159 175	62 32 5	2.19 3.10 1.30	0.09 0.17 0.01 0.01
			Incl.		180	187(EOH)	7	2.94

Intersections are based on greater than 0.2% Cu, minimum of 2 metres downhole length, maximum of 2 metres of internal dilution. All intersections are downhole lengths. Included intersections in bold are based on greater than 1.0% Cu, minimum 2 metres downhole length, maximum of 2 metres of internal dilution. Assays for Cu and Ag are determined by a four acid digest with either an ICP-OES or ICP-AA finish. Coordinates are MGA Zone50 GDA.

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As recently reported, intersections of broad zones of primary mineralisation have now been made at various positions underneath the Thaduna pit. These holes, as well as the recently received assays reported here, have allowed for the development of a conceptual target for the deeper primary mineralisation that is becoming evident. Below is a generic representation of the style of mineralisation that is currently being targeted

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The mineralisation is hosted in a varying sedimentary stratigraphy of silts, shales, fine grained sandstones and greywacke. Key units within a lower grade sequence host high grade mineralisation which may also act as marker beds to the stratigraphy. As can be seen from the image above, the surface oxide expression of the mineralisation, largely mined in the historic pit, transitions through the supergene secondary sulphide chalcocite to the primary sulphide chalcopyrite. The near surface expression of the mineralisation is not directly above the underlying primary mineralisation which may be due to remobilisation during weathering and subsequent intermittent supergene deposition.

A large portion of the RC results remain outstanding, as well as the two diamond tails. Further results will be released as the assays are processed, interpreted and sections are produced.

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Warrawanda/Nickel Hills

In early April 2011, the Company completed an airborne EM geophysical survey over its Warrawanda and Nickel Hills nickel prospects and selected 13 drill targets at Warrawanda. Drilling of 2,494 metres of RC drillholes was completed during July 2011.

The 13 RC holes drilled at Warrawanda have been invaluable in furthering the Company’s understanding of this 15km long highly prospective belt. The initial multi-element results indicate the potential for not only sulphide nickel mineralisation, but Indian style NiFeCo mineralisation.

Further analyses and studies that have been undertaken on selected 1m samples include:

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• Additional multi-element analysis

• Whole Rock Lithogeochemistry

• Thin and Polished sections

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The proposed Quantitative X-ray diffraction work is yet to be completed and once undertaken a summary of the findings will be reported.

From this work the aim is to positively identify nickel sulphide mineralisation and better understand the lithology, mineralogy and alteration assemblages to guide future exploration programs.

As a result of the work completed to date, the increased understanding of the geologic environment of the Warrawanda project area has confirmed the potential for the presence of nickel sulphides with a number of potential mineralising systems including Mt Keith-style sulphide nickel and Indian NiFeCo ores.

Competent Person’s Statement

The information in this release that relates to Exploration Results is based on information compiled by Mr David Reid who is a Member of the Australasian Institute of Mining and Metallurgy (MAusIMM). Mr Reid is an employee of Ventnor Resources Limited. Mr Reid has sufficient experience which is 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 Exploration Results, Mineral Resources and Ore Reserves”. Mr Reid consents to the inclusion in this report of the matters based on information provided by him and in the form and context in which it appears.

The Georgina Basin Project - Queensland:

Ventnors’ applications for EPM’s 18385 to18392 inclusive, and situated in the Georgina Basin Queensland were granted for a period of 5 years from September 2011.

Ventnors exploration personnel conducted a preliminary site visit during November 2011 to investigate access and land ownership.

The Georgina Basin Project is a grassroots exploration project located 200 kms south west of Mt Isa in Queensland. Coincident gravity and magnetic anomalies on the project area are consistent with the possibility of an iron oxide-copper-gold deposit buried beneath late sedimentary cover.

Corporate:

During the quarter the Company completed the following securities issues:

• (i) the allotment and issue of 5,400,000 ordinary fully paid shares at an issue price of 36 cents to raise gross proceeds of $1,944,000; and

• (ii) the allotment and issue of 412,387 ordinary fully paid shares on the exercise of unlisted options exercised at a price of 25 cents each, raising $103,097.

For further details please contact: Bruce Maluish Managing Director Ventnor Resources Limited (08) 9226 3780 www.ventnorresources.com.au