XSTATE RESOURCES LIMITED — Capital/Financing Update 2011

Nov 7, 2011

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ABN 96 009 217 154

8 November 2011

ASX Limited Electronic lodgement

XSTATE RESOURCES COMPLETES PRIVATE PLACEMENT

XState Resources Limited (“XState” or the “Company”) is pleased to advise that it has completed a private placement to raise approximately $730,000 before costs, through a placement to professional and s ophisticated investor clients of Argonaut Limited.

The placement of approximately 11.5 million shares at a price of 6.3 cents each is being undertaken pursuant to S708 of the Corporations Act (Cwth) 2001, and falls within the Company’s 15% placement capacity under ASX Listing Rule 7.1, and as such is not subject to shareholder approval.

In addition to the private placement, existing shareholders registered at the record date of 7 November 2011 will be offered the opportunity to participate in the raising of funds through a share purchase plan (“SPP”) at the same price as the private placement (6.3 cents per share).

Shareholders registered at the close of business on 7 November 2011 will be eligible to participate in the SPP for an amount of between $1,000 and $15,000 per shareholder. A maximum of $945,000 (15,000,000 shares) is to be raised through the SPP. If applications pursuant to the SPP exceed this amount, applicants will be scaled back on a pro rata basis.

The placement and SPP funds will be allocated to the Company’s share of costs for the testing of the Sidi Dhaher well, and for working capital and general corporate purposes.

For and on behalf of the Board.

41 Stirling Highway, Nedlands WA 6009 Tel + 61 8 9423 3200 Fax +61 8 9389 8327 www.xstate.com.au