ZEOTECH LIMITED — Interim / Quarterly Report 2012

Oct 30, 2012

1

For the three months ending 30 September 2012

Quarterly Report

31 October 2012

Summary & Highlights for the September Quarter 2012

Laconia Resources Limited

ASX Code: LCR ABN: 29 137 984 297

Level 1, 41‐43 Ord Street West Perth WA 6005

PO Box 1151, West Perth WA 6872

Tel: 08 9486 1599 Fax: 08 9486 7899 Email: info@laconia.com.au www.laconia.com.au

Capital Structure

271.9 million shares (26.5 million escrowed)

24.1 million unlisted options

Rasuhuilca, gold‐silver, Peru

• Sampling program confirms tenor of historic channel sampling in existing cross‐cuts at Rasuhuilca Vein.

• Extension of high‐grade silver zone identified at Rasuhuilca Vein‐ West;

o 1.5 m @ 11.68g/t gold and 236.74g/t silver,

• 1 m @ 3.64g/t gold and 330.19g/t silver,

• 2 m @ 1.14g/t gold and 1,622.43g/t silver at surface.

• New gold‐silver exploration targets identified 4.5km from the current resource at the Marcelita area;

• 1.5 m @ 14.76g/t gold and 208g/t silver,

• 1.5 m @ 22.80g/t gold and 45.20g/t silver,

• 3.5 m @ 6.53g/t gold and 244.66g/t silver.

• The drill tender process is complete. Program of work approval (DIA) is nearing completion.

Lennons Find, precious and base metals, Western Australia

• Initial pit optimisation confirms potential for oxide material.

• Preliminary leach testwork continues with good recovery results.

• Oxide bulk sample to undergo further leach metallurgical testwork.

Corporate

• Vincent Algar appointed as Non‐Executive Director.

Board Members

Matthew Howison Chairman

Ian Stuart Managing Director

Dr. Saliba Sassine Non‐Executive Director

Vincent Algar Non‐Executive Director

Matthew Edmondson Company Secretary

• Well funded to finalise feasibility study review and upcoming exploration programs:

• Completed Capital Raising of $472,000.

• Announced non‐renounceable pro‐rata underwritten rights issue at 2.0c to raise $1.8 million.

• Laconia received a R&D tax refund from the Australian Taxation Office of $207,000.

Planned Activities for December 2012 Quarter

• Rasuhuilca Project Feasibility Study (2008) review underway by Optiro Consultants due for completion in December 2012 quarter.

• Approval to undertake a diamond drilling program (2,200m) at Rasuhuilca Project, to validate and extend the existing underground resource potential, is being sought during the quarter.

• Undertake site program and to verify further exploration targets at Rasuhuilca Project.

• Completion of community consultation and DIA approval process.

Laconia Resources – September 2012 Quarterly Report

Rasuhuilca Gold‐Silver Project, Southern Peru

(100% Laconia)

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During the quarter ended 30 September 2012, Laconia Resources Limited (ASX:LCR) (the Company) is pleased to have made significant progress at the Rasuhuilca Project with encouraging exploration results received. Laconia remains focused on the Company’s strategy to progress the known gold‐silver resource to development stage in the short term, while also undertaking exploration activity to define further regional drilling targets. During the quarter, the Company has identified exploration targets both on the margins of the current resource at Rasuhuilca, and also 4.5km away at the Marcelita vein system.

The Company completed the acquisition of the Rasuhuilca advanced gold‐silver development project in Peru in June 2012[1] and has made rapid progress towards potentially expanding the current resource. The acquisition has established Laconia as an emerging precious metals producer and will complement the Company’s existing portfolio of precious and base metals projects in WA.

Work completed at the Rasuhuilca Project during the September Quarter 2012

• Sampling program confirms tenor of historic channel sampling in existing cross‐cuts at Rasuhuilca Vein;

• Extension of high‐grade silver zone identified at Rasuhuilca Vein‐ West;

• New gold‐silver exploration targets identified 4.5km from the current resource at the Marcelita area;

• Program of work approval (DIA) nearing completion ahead of 2,200m diamond drilling program.

About the Rasuhuilca Project

The Rasuhuilca Project is located approximately 500km south east of the Peruvian capital, Lima, in the southern part of the country (Figure 7). It is an advanced, high‐grade gold and silver project with near‐term development potential with significant exploration upside potential. The Company’s strategy is to utilise the potential revenues from the project once in production to fund further exploration, and increase the current resource base.

The project currently has an Inferred Resource estimate of; 360,000t @ 1.97g/t Au and 179g/t Ag (at a 2.5 g/t AuEq cut‐off[2] ).

This Resource statement is based on historical data and classified as Inferred Resource as there was a lack of independent QAQC data available at the time of resource estimation. Independent sampling has since been completed by Laconia (see this report) to confirm the tenor of the historic data. The company plans to review the resource (category and size) so it can confidently be used as the basis for mine planning activities, with an internal review of a feasibility study completed by previous owners (2008) already underway.

Underground channel sampling program

In July, the Company announced successful completion of a program of underground check sampling, designed to confirm the grade tenor of prior channel sampling undertaken by previous owner, Minera Peru Gold SAC (MPG)[3] . MPG undertook comprehensive sampling of gold‐silver vein mineralisation in all ore drives and crosscuts.

1 Refer ASX Release 1 June 2012.

2 All cut offs based on an Xg/t Au Eq are conceptual in nature only. There has been insufficient metallurgical test work to date to determine eventual metallurgical recoveries and it is uncertain that the conceptual cut offs used below will be appropriate following further metallurgical test work.

3 Refer ASX Release 4 July 2012.

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Laconia Resources – September 2012 Quarterly Report

Through this channel sampling program, Laconia is able to successfully confirm that MPG’s channel sampling is a reliable sample of the mineral resource, and will be suitable for use in resource estimations.

The comparisons between Laconia’s and the earlier MPG sampling results are presented below in Figure 1 and Table 1.

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Figure 1: Length weighted composites comparing Laconia channel sampling results with channel sampling by previous owner MPG.

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Laconia Resources – September 2012 Quarterly Report

Mine Level Laconia Sample MPG Sample Northing (m) Easting (m) RL (m)	Length (m)	Laconia Au g/t MPG Au g/t Laconia Ag g/t MPG Ag g/t
4923 2901 3091 8,416,703 631,631 4,924	1.00	3.46 3.10 312 321
4923 2903 3093 8,416,702 631,629 4,924	0.90	3.68 3.50 329 314
4923 2904 3094 8,416,701 631,628 4,924	1.50	1.90 2.39 188 182
4923 2905 3095 8,416,700 631,627 4,924	1.05	14.06 11.84 1408 523
4923 2906 3096 8,416,699 631,627 4,924	1.05	10.64 15.89 485 531
4923 2907 3097 8,416,699 631,625 4,924	1.05	8.56 8.34 423 445
4923 2908 3098 8,416,698 631,625 4,924	0.95	8.50 14.24 572 539
4923 2909 3099 8,416,697 631,624 4,924	1.55	10.97 23.24 281 433
4923 2910 2628 8,416,696 631,623 4,924	1.30	0.72 0.35 81 82
4923 2911 2629 8,416,695 631,622 4,924	1.30	0.63 0.30 88 71.9
4923 2912 3100 8,416,694 631,622 4,924	0.90	4.15 9.49 186 255
Comp 1*	12.55	5.99 8.50 373 317
4923 2913 2420 8,416,698 631,620 4,924	0.80	1.09 2.00 110 130
4923 2914 2419 8,416,699 631,621 4,924	1.00	1.68 1.70 178 139
4923 2915 2418 8,416,699 631,622 4,924	0.90	1.03 0.35 108 134
Comp2*	2.7	1.29 1.34 134 134
4890 2921 2448 8,416,681 631,647 4,892	1.00	0.32 0.30 41 43
4890 2922 2449 8,416,682 631,647 4,892	0.95	15.67 0.60 54 61
4890 2923 2450 8,416,683 631,647 4,892	1.00	0.96 1.55 33 53
4890 2924 2451 8,416,684 631,647 4,892	1.00	0.40 0.40 29 58
4890 2925 2452 8,416,685 631,647 4,892	1.50	0.24 0.25 60 66
4890 2926 2453 8,416,686 631,647 4,892	1.45	0.16 0.30 80 69
4890 2927 2454 8,416,687 631,648 4,892	1.35	0.37 0.35 63 59
4890 2928 2455 8,416,689 631,649 4,892	0.70	0.39 0.75 76 123
4890 2929 2456 8,416,690 631,649 4,892	1.55	1.14 1.45 89 102
Comp3*	10.5	1.88 0.65 61 70
4890 2931 2461 8,416,693 631,618 4,892	1.60	2.91 2.20 106 227
4890 2932 2462 8,416,694 631,618 4,893	1.30	3.06 3.30 364 223
4890 2933 2463 8,416,696 631,618 4,893	1.90	2.24 2.70 63 72
Comp4*	4.8	2.69 2.70 159 1.9
4890 2934 2472 8,416,695 631,608 4,893	1.30	0.29 0.20 45 50
4890 2935 2473 8,416,696 631,608 4,893	1.40	0.35 0.25 27 94
Comp5*	2.7	0.32 0.23 36 73

Table 1: Underground channel sample validation at Rasuhuilca. (Laconia Resources 2012 channel sample assays compared with previous owner MPG channel sample assays).

Note 1: Laconia samples were assayed at CERTIMIN S.A., in Lima Peru. Au by Fire assay and AAS read, >10ppm Au was re‐calculated by gravimetric method. Silver assays by Digest concentrate. HCL+HNO3 in 3:1 mix with Aqua Regia and AAS read, >300ppm Ag was subject to extended digest and AAS read, >1000ppm Ag was re‐calculated by gravimetric means. Note 2: CompX* refers to length weighted composite grade.

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Laconia Resources – September 2012 Quarterly Report

New Exploration Targets Identified

During a comprehensive review of all existing data, Laconia has identified a range of additional target areas both on margins of the current resource at Rasuhuilca, and also at a veining system approximately 4.5km to the south east[4] . Throughout the ongoing review, specific emphasis is being placed on the potential expansion of the existing resource at Rasuhuilca and the surrounding project area.

Rasuhuilca Deposit Exploration Potential – West Zone

A high‐grade silver zone at the Rasuhuilca deposit lies 110m west of the main body of mineralisation. Abundant silver at surface demonstrates potential for a silver rich body extending to depth. Significant results are presented in Table 2 with complete assay results presented in Appendix 1. The high‐grade silver zone at the west end of the Rasuhuilca deposit has been subject to surface sampling and a single underground adit development only.

The depth potential beneath the known mineralisation remains untested (see Figure 2). The Company believes that development on the 4890 Level has failed to intersect the mineralised zone, due to a southerly plunge of the mineralised body, similar to the main mineralised body to the east. Only a small part of this zone has been tested sufficiently for inclusion in the existing inferred resource.

Underground development from the main Rasuhuilca underground workings are already established (4890 Level), providing a location to drill test this western zone.

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Figure 2: Rasuhuilca West Zone target and existing development.

4 ASX Release 16 August 2012.

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Laconia Resources – September 2012 Quarterly Report

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Figure 3: Significant results from surface sampling above 4962 Level, Rasuhuilca West Zone

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Laconia Resources – September 2012 Quarterly Report

Location	Easting	Northing	Elevation	Length (m)	Au (g/t)	Ag (g/t)
Rasuhuilca West 631,463.41 8,416,744.21			4961.85 2 0.6 400.05
Rasuhuilca West 631,462.56 8,416,738.64			4966.72 2 0.41 393.7
Rasuhuilca West 631,458.51 8,416,746.4			4960.36 2 0.6 422.28
Rasuhuilca West 631,477.98 8,416,739.33			4964.78 2 1.14 1622.43
Rasuhuilca West 631,522.59 8,416,704.86			5005.45 6 0.57 260.35
Rasuhuilca West 631,517.15 8,416,723.67			4986.06 7 2.03 196.85
Rasuhuilca West 631,493.67 8,416,729.58			4973.77 6 0.67 247.65
4962 Adit 631,483.36 8,416,744.04			4962 1 5.23 1108.94
4962 Adit 631,483.38 8,416,743.06			4962 1 5.73 616.77
4962 Adit 631,482.34 8,416,738.95			4962 1 3.64 330.19
4962 Adit 631,482.22 8,416,737.9			4962 1 8.72 193.13
4962 Adit 631,484.53 8,416,711.91			4962 1.5 11.68 236.74
4962 Adit 631,484.28 8,416,736.11			4962 1 3.05 190.02
4962 Adit 631,485.67 8,416,716.84			4962 1 2.31 763.18
4962 Adit 631,486.39 8,416,712.9			4962 1 0.78 451.68
4962 Adit 631,483.38 8,416,716.7			4962 1 0.37 513.98
4962 Adit 631,484.05 8,416,712.74			4962 1 9.41 448.56

Table 2: Significant surface and channel sampling intersections, Rasuhuilca West Zone.

Note 1: Sample results are compiled as weighted averages. Sample ID shown is for the first sample in the sequence. Samples were collected by Buenaventura between 1997 and 1999, and assayed at Intertek Bondar Clegg Bolivia. Gold (Au) was analysed by AAS with Fire Assay checks on 50 g aliquots to 2 ppb detection limits and AAS was used for Silver (Ag). All assays are available with original lab certificates from Intertek Bondar Clegg in Bolivia. Normal lab QAQC was done, and show no issues in quality. Note 2: Coordinate system used is PSAD56/UTM zone 18S EPSG 24878

Additional High Grade Gold Silver Veins at Marcelita

The Marcelita vein system and underground development is located 4.5km to the south east of the Rasuhuilca vein system (Figure 4).

Laconia’s review of the existing prospects at Marcelita has indicated a vein system which demonstrates a strike extent of 710m. To date, only 66 surface samples have been collected and assayed for gold and silver. Of the 66 samples collected, 44 samples contained gold greater than 1g/t and/or silver greater than 60g/t. A further 480m strike of veining exists in the area, which has not been surface sampled to date.

The review so far confirms considerable potential for gold‐rich oxide material amenable to bulk mining techniques and the potential for deeper plunging shoots of sulphide material with gold and silver credits. Significant samples are presented in Table 3 and all results are presented in Appendix 2.

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Laconia Resources – September 2012 Quarterly Report

The Company’s exploration plan for the Marcelita area will focus on targeting oxide material to determine if there are quantities of gold mineralisation amenable to bulk mining techniques close to surface. In addition, the potential for deeper high grade shoots of silver and gold mineralisation focussed around the intersection or close occurrence of faults and veins will be evaluated.

Zones of breccia will also be targeted as the regional geology of the Rasuhuilca Project implies potential for the presence of mineralised phreatic breccias, with a significant vertical component.

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Figure 4: Significant surface sampling results from the Marcelita Vein System and Elsa Breccia.

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Laconia Resources – September 2012 Quarterly Report

Sample	Prospect	Easting	Northing	Elevation	Length	Au	Ag
ID						(g/t)	(g/t)
23885	Elsa Breccia	632,595.0	8,415,082.0	4769	1.5	22.80	45.20
23887	Elsa Breccia	632,596.0	8,415,072.0	4769	1.5	14.76	208.00
23865	Veta Marcelita	632,467.0	8,415,045.0	4717	1.4	5.48	117.50
29006	Veta Marcelita	632,447.5	8,415,118.7	4704	0.9	3.49	819.40
23872	Veta Marcelita 1	632,547.5	8,415,259.6	4708	1	4.88	105.50
23903	Veta Marcelita 2	632,727.7	8,415,271.5	4807	3.50	6.53	244.66
23917	Veta Marcelita 2	632,747.2	8,415,125.1	4825	3.60	17.31	7.17
23933	Veta Marcelita 2	632,751.4	8,415,050.8	4820	0.60	0.13	2078.62

Table 3: Significant surface sampling results from the Marcelita Vein and Elsa Breccia.

Note 1: Sample results are compiled as weighted averages. Sample ID shown is for the first sample in the sequence. Samples were collected by Buenoventura between 1997 and 1999, and assayed at Intertek Bondar Clegg Bolivia. Gold (Au) was analysed by AAS with Fire Assay checks on 50 g aliquots to 2 ppb detection limits and AAS was used for Silver (Ag). All assays are available with original lab certificates from Intertek Bondar Clegg in Bolivia. Normal lab QAQC was done, and show no issues in quality. Note 2: Coordinate system used is PSAD56/UTM zone 18S EPSG 24878

The Marcelita Vein System ‐ background

The Marcelita Prospect contains three mineralised silicified vein systems Veta Marcelita, Veta Marcelita 1 and Veta Marcelita 2, and one mineralised breccia Elsa Breccia. The Marcelita area was subject to exploration by Buenaventura from 1997 – 2003. Initial exploration consisted of surface sampling, followed by development of the 4710 adit that drives 300m along the Veta Marcelita 2 system. Historic resource estimates were completed for Veta Marcelita 2 but are not of the standard required for JORC reporting, and therefore need to be re‐evaluated, possibly after collection of further data.

The Marcelita system is a silica‐barite‐gold‐silver vein system that strikes north‐south. There are numerous cross‐cutting fault structures ranging from east‐west orientation to southeast‐northwest orientation. The veins range from stringer zones to greater than 1.5m width, and contain plunging shoots of high grade (> 30g/t) gold mineralisation, as shown by historic exploration adit development, and small‐scale mining operations by previous owners.

At the surface the mineralisation is hosted by oxidised rock, where sulphides are now weathered to hematite, jarosite and limonite/goethite. Supergene enhancement has increased the gold content and depleted the silver content in the oxide zone. At depth the veins contain abundant sulphides, and are more silver‐rich. The extent of the mineralisation at depth is more constrained where dispersal due to weathering has not occurred.

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Laconia Resources – September 2012 Quarterly Report

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Figure 5: Veta Marcelita 2 portal.

Historic work at the Marcelita 2 Prospect has identified an oxide zone extending from surface to 50‐70m depth, which is gold‐rich and silver‐depleted. Below the oxide zone there is a sulphide zone that is richer in silver than in gold.

Rasuhuilca Project ‐ further exploration potential

The Rasuhuilca Project is situated on the collapsed rim of the Rasuhuilca strato‐volcano within a highly visible zone of secondary potassic alteration, and Laconia aims to target the following mineralisation styles:

• The network of outcropping gold‐silver veins in lower temperature acidic outflow zones (silica‐alunite‐sulphide alteration);

• Large‐scale, sub‐horizontal disseminated gold‐silver mineralisation within outflow zones;

• High‐grade bonanza gold veins beneath the acidic outflow zones;

• Copper‐gold mineralisation within buried intrusive stocks, or gold‐silver‐zinc mineralisation in skarns surrounding buried intrusive stocks.

Diamond drilling program

An initial phase comprising 2,200m of diamond drilling is planned to commence upon receipt of approval from Peruvian authorities.

The program is designed to test mineralisation between the existing underground development levels, and thus further validate the existing resource model. The Company believes there is good potential to grow the resource base and plans to test the Rasuhuilca vein both along strike and down dip in this program.

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Laconia Resources – September 2012 Quarterly Report

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Figure 6: Long section of Rasuhuilca resource model with current and planned development.

A consulting hydrologist spent two days identifying and analysing creeks, springs and other water collections within a two kilometre range of the site of current operations. The updated information will form part of the DIA for drilling and baseline data for later applications.

Logistics to support site accommodation for the proposed drilling program are progressing.

Mining Study

A study of the economics of an underground operation at Rasuhuilca was completed by the previous owners in 2008. While the study is no longer current, Laconia believes that many of the basic tenets of the study are relevant in terms of geology, mine design, metallurgy, logistics and environmental permitting. Optiro Consulting have been appointed as study manger to review and update the Rasuhuilca study document. Andrew Law, who is supervising the review, assessed the engineering aspect of the study as part of Laconia’s due diligence process. He has in‐country experience in Peru, having previously managed Mundo Minerals Limited’s Torricellias Project and is very familiar with low capex, small tonnage, high grade operations.

The review will focus on the following aspects: Mining, milling, metallurgical test work, capital requirements, operating costs and financial analysis. The majority of the work will be out‐sourced to Mining Solution SAC, a Lima based engineering group. This part of the review will focus on engineering aspects of the study only. Environmental and legal aspects will be handled by Laconia and out‐sourced to other groups as appropriate. The study review has commenced and is due for completion in the current quarter.

The current review of mineralisation potential to date indicates a reasonable expectation to increase resources and the expected mine life (calculated on the single Rasuhuilca vein, currently at 4 years) with incremental feed expected from other vein systems nearby that will be subject to upcoming exploration activity.

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Laconia Resources – September 2012 Quarterly Report

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Figure 7: Rasuhuilca Project location map.

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Laconia Resources – September 2012 Quarterly Report

Australian Exploration Activities

Lennons Find Project – Precious and Base Metals, East Pilbara WA (95% Laconia)

M45/368 (95%), E45/3293 (100%)

About the Lennons Find Base Metal Project

The project covers 116 km[2] of Archaean terrain and is located approximately 40 km from Marble Bar on the southern edge of the Mt Edgar Granitoid Complex, in the East Pilbara region of Western Australia. The Project is located on a granted mining lease. Outcropping gossanous veins with elevated base metals grades are present in the project area and occur at a consistent horizon along a 16.5km strike length of the Duffer Formation. It is this horizon which is the current focus for Laconia’s base metals exploration.

Lennons Find Mineral Resource

The total Mineral Resource at Lennons Find (M45/368) as defined by surface drilling is:

• 1.8Mt @ 82g/t silver, 0.26g/t gold, 0.2% copper, 1.4% lead and 5.1% zinc (in Indicated and Inferred categories, at various Zn Equivalent cut‐off grades[5] ) and; includes an Oxide Resource of: 200,000t @ 89g/t silver, 0.37g/t gold, 0.2%copper, 1.2 % lead and 1.4% zinc.

	Deposit Ore Type Tonnes (t) Au (g/t) Ag (g/t) Cu (%) Pb (%) Zn (%)
Indicated	Bronze Whaler Oxide 30,000 0.29 60 0.3 0.9 0.2
	Hammerhead Oxide 140,000 0.41 95 0.2 1.3 1.8
	Tiger Oxide 20,000 0.18 93 0.1 0.9 0.8
	Total ‐ Indicated Oxide 200,000 0.37 89 0.2 1.2 1.4
Inferred	Bronze Whaler Sulphide 150,000 0.15 33 0.1 0.7 1.5
	Hammerhead Sulphide 1,400,000 0.27 87 0.2 1.6 6.1
	Tiger Sulphide 50,000 0.03 36 0.1 0.3 2.8
	Total ‐ Inferred Sulphide 1,600,000 0.25 81 0.2 1.5 5.6
Total	Bronze Whaler 180,000 0.18 37 0.1 0.7 1.3
	Hammerhead 1,600,000 0.28 88 0.2 1.6 5.7
	Tiger 70,000 0.08 55 0.1 0.5 2.2
	Total ‐ Lennons Find 1,800,000 0.26 82 0.2 1.4 5.1

Table 4: Breakdown of the Lennons Find Mineral Resource at January 2012.

Note 1: For Oxide resources the Bronze Whaler deposit is reported above 1% Zn Eq, the Hammerhead deposit is reported above 2% Zn Eq and the Tiger deposit is reported above 4% Zn Eq

5 All cut offs based on an X% Zn Eq are conceptual in nature only. There has been insufficient metallurgical test work to date to determine eventual metallurgical recoveries and it is uncertain that the conceptual cut offs used below will be appropriate following further metallurgical test work.

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Laconia Resources – September 2012 Quarterly Report

Note 2: For Sulphide resources the Bronze Whaler deposit is reported above 1% Zn Eq, the Hammerhead deposit is reported above 2% Zn Eq and the Tiger deposit is reported above 4% Zn Eq

Work completed at the Lennons Find Project during the September Quarter 2012

• Preliminary leach testwork continues with good recovery results.

• Oxide bulk sample to undergo further leach metallurgical testwork.

• Initial pit optimisation confirms potential for oxide material.

Metallurgical testwork

Metallurgical test results and a subsequent direct cyanidation leach test conducted by ALS Ammtec metallurgical laboratories indicate that the following recoveries are achievable[6] ;

• Sequential leach. Acid leach followed by cyanide leach on Composite 1 (test number HY734, MH8773, 10 days sampling time)

• Gold extraction 87.5%

• Silver extraction 94.9%

• Copper extraction 75.7%

• Zinc extraction 87.9%

• Direct cyanide leach only on Composite 2 (test number MH8773, 10 days sampling time)

• Gold extraction 80.4%

• Silver extraction 92.1%

• Copper extraction 41.6%

These tests were performed on two composites samples collected from RC drill chips. The direct cyanidation results are extremely encouraging, and warrant further exploration work to expand the resource base given the current high prices achievable for gold and silver.

Bulk sample of Lennons Find oxide ore delivered to laboratory for column leach tests

Following on from success in preliminary leach tests, a two tonne bulk sample of oxide material was collected from the project. The material has been despatched to ALS Ammtec metallurgical laboratory, Perth, where laboratory scale column leach testing is planned. This will provide a better guide to likely metal recoveries from a small scale heap leach process on site.

Preliminary Economic Assessment of Indicated Oxide Resource

A preliminary economic assessment of the known oxide resource at Lennons Find has been conducted. An optimisation run using the Lerchs‐Grossman algorithm was undertaken on the oxide resource, looking to recover only gold, silver and copper using the direct cyanide leach results as the basis for the optimisation.

The following input parameters were applied to the optimisation run, conducted by OPTIRO consultants using the Resource Block Model for Lennons Find and using NPV Scheduler software.

• Mining Costs (per BCM) – A$7.26

• Processing Costs (per tonne of ore) – A$10.05

• Royalty (State) – 2.5%

• Refining Costs – US$ 5/oz Ag, Au and US$200/t Cu

6 ASX Release 15 March 2012.

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Laconia Resources – September 2012 Quarterly Report

 Recovery‐ Ag 92.1%, Au 80.4%, Cu 41.6%

Two price scenarios were considered (Table 5).

Metal	Spot (US$)	Bull Price (US$)
Silver/oz	34	50
Gold/oz	1761	2000
Copper/t	8110	9000

Table 5: Price scenarios used in Lennons Find pit optimisations.

The results of the optimisation indicate the following :

Scenario	Total	Ore	Gold	Silver	Copper	Revenue	Proc	Mining	NPV
	tonnes	tonnes	(koz)	(koz)	(kt)	($M)	Cost	Cost	($M)
	(kt)	(kt)					($M)	($M)
SPOT	1,175	124	1.7	406	0.3	12.9	1.3	5.3	6.2
BULL	1,663	150	1.9	473	0.3	22	1.6	7.4	12.6

Table 6: Results of pit optimisation of Lennons Find oxide resource.

Note 1: *Value quoted for NPV are indicative only and do not take into account capital cost estimates

Capital Cost estimate for Heap Leach Operation and Precious metal Extraction

Following the optimisation work, the Company retains a positive view about the prospects of eventual economic extraction of the Lennons Find Oxide resource. The occurrence of mineralisation within a secure mining lease title is considered a significant advantage.

Capital expenditure estimates are currently being undertaken to determine the cost of establishing a heap leach processing facility on the mining lease. A low cost contract mining and processing approach will be applied when considering the capital costs. Further metallurgical testwork on the development of a precious metal concentrate will be conducted at ALS Ammtec during the December 2012 Quarter.

Exploration Potential

The current Lennons Find oxide Mineral Resource of 200,000t contains a potentially economic quantity of silver, gold and copper as shown by the preliminary pit optimisation. Three resource areas have currently been defined by limited recent and historical drilling along a 4km strike length within the mining lease boundaries. Building on the results of the preliminary economic assessment of the oxide resource, the Company will be looking to add to the current resource base at Lennons Find.

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Laconia Resources – September 2012 Quarterly Report

Yandicoogina Project (E45/3293)

No work was completed at Yandicoogina this quarter.

==> picture [415 x 281] intentionally omitted <==

Figure 8: Lennons Find and Yandicoogina Project location.

Upcoming Work

• Laboratory scale column leach tests at ALS Ammtec metallurgical laboratory.

• Ongoing mapping and surface sampling at Yandicoogina prospect.

PAGE 16

Laconia Resources – September 2012 Quarterly Report

701 Mile Project – Precious and Base Metals, Northern Gascoyne, WA

(80% Laconia – excluding manganese and iron)

E52/2232, E52/2688‐I

About the 701 Mile Project

The 701 Mile Project consists of two granted exploration licences covering a contiguous area of 343km[2] , and is located approximately 80km south east of Newman in WA. The Company has 80% interest in all minerals other than manganese and iron.

The region hosts a number of significant discoveries, which include base metals deposits at ‘Kumarina’ and ‘Abra’ as well as Independence Group’s (ASX:IGO) Karlawinda Gold Project. Independence Group recently reported an Inferred Mineral Resource at the Karlawinda Gold Project of 18.5Mt @ 1.1 g/t Au for 674,300 ounces of contained gold[7] .

Laconia’s exploration programs at the 701 Mile Project to date (auger geochemical programs, geological mapping and aeromagnetic interpretation) indicate that the project has considerable potential for various mineralisation styles including structurally controlled polymetallic lodes and veins associated with faults and the margins of mafic intrusives.

The project is proximal to the regional scale Tangadee Lineament and is hosted within sedimentary rocks and mafic intrusives of the Collier Basin. Large areas of the tenement are overlain by shallow cover including alluvial wash, calcrete and sand and auger drilling was conducted in these areas to penetrate this cover to obtain meaningful geochemical samples.

No work was completed this quarter at the 701 Mile Project.

7 Refer to Independence Group NL ASX announcement 28 June 2012.

PAGE 17

Laconia Resources – September 2012 Quarterly Report

==> picture [472 x 329] intentionally omitted <==

Figure 9: Contoured silver and lead anomalism in auger holes (with best silver grades >0.5ppm highlighted).

Upcoming work

• Follow up of surface anomalism with RAB or aircore drilling to test down to bedrock.

• Detailed aeromagnetic surveys will be expanded to cover the entire tenement area.

• Drilling under the co‐funded grant awarded by the Western Australian Government is expected to occur in the second quarter of 2013.

Mooletar Iron Ore Project, Mount Magnet WA

(100% Laconia)

E58/384, M58/110, P58/865, P58/1054‐1056, P58/1129, P58/1383‐1388, P58/1408 ‐ 1415, P58/1476‐1485, P58/1495‐1501, P58/1511, P58/1583, M58/266 (application), M58/349 (application)

In August 2011, the Company announced it had entered into a $7.5 million Joint Venture (JV) Agreement with Chinese syndicate, Sinoz Mining Investment Group Pty Ltd (Sinoz), for the exploration and development of its Mooletar Iron Ore Project, near Mt Magnet in the Mid‐West iron ore precinct of Western Australia[8] .

8 Refer to ASX announcement 8 August 2011.

PAGE 18

Laconia Resources – September 2012 Quarterly Report

Sinoz subsequently requested that an additional party be permitted to join the joint venture syndicate. An initial $50,000 non‐refundable option fee was paid by Sinoz to secure the agreement. Following an extended period of delay by Sinoz in making a second payment due under the Joint Venture agreement, it was decided by both parties to mutually terminate the Joint Venture at the end of the September Quarter. Laconia is currently reviewing expressions of interest in the iron and precious metals rights to the Mooletar project.

About the Mooletar iron Project

The Mooletar project lies approximately 330km east of Geraldton by sealed highway, and approximately 125km from the proposed rail line in the mid‐west infrastructure corridor that would access the Oakajee port infrastructure. The Project is 100% owned by Laconia and comprises an area of 91km[2] over the eastern limb of the Archaean Mount Magnet greenstone belt. The greenstone belt hosts the Mt Magnet Gold Mine and associated gold deposits to the east of the Mooletar project licences.

The project covers a 5km strike length of banded iron formations (BIF) and has an updated Exploration Target of 230‐270 million tonnes of iron at 30‐35% Fe[9] . The Exploration Target was confirmed as a result of two drill programs and a detailed mapping program completed over the project area. It was confirmed by independent consultants, BM Geological Services Pty Ltd[10] .

Results from Davis Tube Recovery (DTR) test work[11] indicated that a high grade magnetite product may be achieved with grades up to 70.4% Fe and low levels of phosphorus and silica. The Company has completed a scoping study to evaluate its exploration and development potential.

9 Refer to ASX announcement 18 November 2010.

10 The potential quantity and grade of the Mooletar Project is conceptual in nature and there has been insufficient drilling to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a mineral resource.

11 Refer to ASX announcement 17 August 2010.

PAGE 19

Laconia Resources – September 2012 Quarterly Report

==> picture [413 x 293] intentionally omitted <==

Figure 10: Mooletar Project location and regional infrastructure (present and proposed).

Barramine Project – Gold and Base Metals, East Pilbara WA

(100% Laconia – excluding manganese and iron)

E45/3312, E45/3233, E45/3234

No work was conducted on the Barramine Project during the Quarter.

About the Barramine Project

The Barramine Exploration Project, located in the East Pilbara region of northern WA comprises three exploration licences with a combined area of 430 km[2] . Modern exploration has been undertaken since the mid 1960’s, however the area has not been extensively explored.

The Barramine Project is located along the southern edge of the Canning basin, but is mainly underlain by the Gregory Range Inlier which is largely composed of upper Archaean Fortescue Group, Carawine Dolomite, Pinjian Chert Breccia and underlying Gregory Granitic Complex. The Inlier has been mined historically for lead, and minor copper showings are located at Camel Hump and Barramine South. Manganese is currently produced at the Woodie Woodie mine, 80km southeast of the Barramine Project.

The following deposit types are considered valid conceptual exploration targets:

1. Volcanic‐related base metal sulphide horizons within sediments similar to Wonmunna, or in andesitic/rhyolitic volcanics.

2. Mississippi Valley type lead‐zinc‐ barite deposits on the southern flank of the Canning Basin.

3. Structurally controlled gold mineralisation possibly associated with NNW trending structures.

.

PAGE 20

Laconia Resources – September 2012 Quarterly Report

==> picture [235 x 335] intentionally omitted <==

Figure 11: Barramine defined geochemical target locations.

Kookynie Project – Gold and base metals, Kookynie, Eastern Goldfields WA

(100% Laconia)

P40/1255, P40/1256, E40/260

No field based exploration was conducted at the project during the Quarter. Analysis of previous sampling was conducted by the Company’s geologists in Perth.

Various parties have been approached to gauge their interest in purchasing the 162 km[2] tenement package, which is prospective for epithermal and alluvial gold and VMS type base metals.

PAGE 21

Laconia Resources – September 2012 Quarterly Report

Corporate

During the quarter, Laconia undertook a Board restructure in alignment with its strategy to focus on the flagship Rasuhuilca Project in Peru, and to support the ongoing corporate and technical activity of the Company. This included:

• Appointment of non‐executive Director, Vincent Algar

• Appointment of non‐executive Director, Dr Saliba Sassine

• Appointment of Company Secretary, Matthew Edmondson

• Resignation of Chairman and appointment of Chairman Matthew Howison (previously Non‐Executive Director)

Capital Raising

The Company announced on 3 September 2012 that it had completed a placement of 23,643,751 million fully paid ordinary shares in the Company at an issue price of 2 cents per share, to raise approximately $0.47million (the Placement).

The Placement, made to sophisticated and professional investors, occurred pursuant to the Company’s 15% placement capacity under ASX Listing Rule 7.1 and accordingly shareholder approval will not be sought.

In recognition of shareholder support, Laconia announced that it intended to offer a fully underwritten non‐ renounceable Shareholder Entitlement Rights Issue (Rights Issue) of one (1) new share for every two (2) existing shares held by shareholders at an issue price of $0.02 per share. The Rights Issue will raise approximately A$1.81 million (before costs of the Issue) and result in the issue of 90,634,380 new shares.

The rights issue offer was subsequently closed on the 15[th] October with Indian Ocean Capital (IOC) acting as lead manager to the Placement and lead manager and underwriter to the Rights issue.

The Placement and the Rights Issue enables the Company to complete its next phase of exploration, including its recently announced 2,200m drilling program at its Peru Rasuhuilca Project.

Information regarding the Rights Issue has been the subject to separate disclosure to the market.

Laconia has 655 shareholders with the top 20 shareholders holding 45% of the total issued capital.

Subsequent to the quarter Laconia has received a R&D tax refund of $207,000.

At the end of the Quarter, the Company had cash at bank of $563,000.

Further reports and an overview of Laconia’s Projects can be viewed on the Laconia website (www.laconia.com.au).

PAGE 22

Laconia Resources – September 2012 Quarterly Report

Outlook for December 2012 Quarter

Rasuhuilca

• Completion of community consultation and DIA approval process.

• Approval to undertake a diamond drilling program (2,200m) at Rasuhuilca Project, to validate and extend the existing underground resource potential, is being sought during the quarter.

• Review and update by Optiro of 2008 feasibility study for underground gold silver mine.

• Collate regional exploration data and review exploration strategy for gold, silver and copper.

• Undertake site program to verify further exploration targets at Rasuhuilca Project.

Lennons Find.

• Review of exploration potential to expand oxide resources at Lennons Find.

ENDS

For further information on Laconia Resources Limited please contact:

Ian Stuart Sam Burns Managing Director Media and Investor Relations Laconia Resources Six Degrees Investor Relations P: +61 8 9486 1599 M: 0400 164 067

E: istuart@laconia.com.au E: sam.burns@sdir.com.au

or visit our website at: www.laconia.com.au

PAGE 23

Laconia Resources – September 2012 Quarterly Report

Competent Persons Statements

Information in this report relating to the Lennons Find, Barramine, 701 Mile, Goldsworthy, Kookynie Projects and Rasuhuilca (Peru) have been compiled by Mr Vincent Algar. Mr Algar, who is a member of the Australasian Institute of Mining and Metallurgy, has compiled the information within this presentation that relates to Exploration Results. Mr Algar is a Non‐Executive Director and consultant of Laconia Resources Limited and has sufficient experience relevant to the style of mineralisation and type of deposits under consideration and to the activity currently being undertaken 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 and consents to the inclusion of this information in the form and context in which it appears in this report.

Lennons Find Resource Estimate

Mr Michael Andrew who is a member of the Australasian Institute of Mining and Metallurgy and the Australian Institute of Geoscientists has compiled the information within this presentation that relates to Mineral Resources or Ore Reserves. Mr Andrew is a full time employee of Optiro Pty Ltd and has sufficient experience relevant to the style of mineralisation and type of deposits under consideration and to the activity currently being undertaken 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 and consents to the inclusion of this information in the form and context in which it appears in this report.

Mooletar Magnetite

Information in this report relating to the Mooletar Magnetite Project and has been compiled by Mr Darryl Mapleson. Mr Darryl Mapleson who is a member of Australasian Institute of Mining and Metallurgy has compiled the information within this report that relates to Exploration Results, Mineral Resources or Ore Reserves. Mr Mapleson has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity currently being undertaken 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 and consents to the inclusion of this information in the form and context in which is appears in this report.

Peru

A review of available data was conducted by Mr Michael Andrew, a Principal of Optiro Pty Ltd. Mr Michael Andrew who is a member of the Australasian Institute of Mining and Metallurgy and the Australian Institute of Geoscientists has compiled the information within this presentation that relates to Mineral Resources or Ore Reserves. Mr Andrew is a full time employee of Optiro Pty Ltd and has sufficient experience relevant to the style of mineralisation and type of deposits under consideration and to the activity currently being undertaken 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 and consents to the inclusion of this information in the form and context in which it appears in this report.

PAGE 24

Laconia Resources – September 2012 Quarterly Report

About Laconia Resources Limited

Laconia Resources Limited is a Perth‐based emerging precious and base metals exploration and development Company with a South American focus. The recently acquired Rasuhuilca gold‐silver development project in Peru complements its existing portfolio of precious and base metal projects in Western Australia.

The Company has a portfolio of advanced mineral projects in the Murchison and Pilbara regions in Western Australia, across 52 granted tenements covering an approximate 1200km[2] . The Company has reported JORC Resources in accordance with the JORC Code, at its projects at Lennons Find, (Cu‐Ag‐Pb‐Zn‐Au) and most recently at Rasuhuilca in Peru (Au‐Ag).

The Company is focused on targeted exploration of its project areas, and further definition and expansion of its Resource base at its advanced projects.

PAGE 25

Laconia Resources – September 2012 Quarterly Report

Appendix 1: Surface and channel sampling Rasuhuilca Project

Location	Easting	Northing	Elevation	Length	Au	Ag (g/t)
				(m)	(g/t)
Rasuhuilca West	631464.06	8416748.23	4958.71	2	0	193.68
Rasuhuilca West	631463.7	8416746.19	4960.39	2	0.13	117.47
Rasuhuilca West	631463.41	8416744.21	4961.85	2	0.6	400.05
Rasuhuilca West	631463.13	8416742.17	4963.6	2	0.41	212.73
Rasuhuilca West	631462.85	8416740.33	4965.4	2	0.6	107.95
Rasuhuilca West	631462.56	8416738.64	4966.72	2	0.41	393.7
Rasuhuilca West	631458.51	8416746.4	4960.36	2	0.6	422.28
Rasuhuilca West	631458.23	8416744.35	4962.26	2	0.41	158.75
Rasuhuilca West	631457.91	8416742.31	4964.21	2	0.51	247.65
Rasuhuilca West	631478.83	8416745.19	4960.82	2	0.6	215.9
Rasuhuilca West	631478.55	8416743.35	4962	2	0.38	317.5
Rasuhuilca West	631478.26	8416741.37	4963.37	2	0.89	327.02
Rasuhuilca West	631477.98	8416739.33	4964.78	2	1.14	1622.43
Rasuhuilca West	631477.63	8416737.35	4966.23	2	0.38	168.28
Rasuhuilca West	631477.35	8416735.38	4967.52	2	0.22	133.35
Rasuhuilca West	631477.06	8416733.4	4969.15	2	0.29	327.02
Rasuhuilca West	631476.71	8416731.42	4971.18	2	0.57	107.95
Rasuhuilca West	631476.43	8416729.52	4973.76	2	0.29	60.33
Rasuhuilca West	631476.07	8416727.61	4977.05	2	0.73	142.88
Rasuhuilca West	631475.79	8416725.57	4980.33	2	1.21	61.91
Rasuhuilca West	631475.51	8416723.45	4983.57	2	0.32	231.78
Rasuhuilca West	631485.27	8416733.57	4968.33	2	0.29	127
Rasuhuilca West	631484.91	8416731.74	4969.65	1.8	0.7	314.32
Rasuhuilca West	631484.7	8416729.76	4971.36	1.9	0.48	180.98
Rasuhuilca West	631484.35	8416728.07	4974.02	1.8	0.64	209.55
Rasuhuilca West	631484.21	8416726.3	4976.88	1.8	0.6	127
Rasuhuilca West	631483.78	8416724.47	4979.78	1.9	0.41	152.4
Rasuhuilca West	631483.57	8416722.77	4982.43	1.7	0.7	209.55
Rasuhuilca West	631483.36	8416721.08	4984.98	1.8	1.05	50.8
Rasuhuilca West	631522.59	8416704.86	5005.45	6	0.57	260.35

PAGE 26

Laconia Resources – September 2012 Quarterly Report

Rasuhuilca West	631517.15	8416723.67	4986.06	7	2.03	196.85
Rasuhuilca West	631518.21	8416730.45	4979.66	3	1.56	311.15
Rasuhuilca West	631509.09	8416725.12	4981.99	6.5	0.19	66.67
Rasuhuilca West	631493.67	8416729.58	4973.77	6	0.67	247.65
Rasuhuilca West	631450.33	8416711.65	5003.41	4.8	1.24	9.53
4962 Adit	631483.27	8416745.53	4962	0.5	1.21	105.91
4962 Adit	631483.3	8416745.09	4962	1	2.21	221.17
4962 Adit	631483.36	8416744.04	4962	1	5.23	1108.94
4962 Adit	631483.38	8416743.06	4962	1	5.73	616.77
4962 Adit	631483.49	8416742.07	4962	1	2.46	224.28
4962 Adit	631483.72	8416741.04	4962	1	3.36	264.78
4962 Adit	631483.9	8416740.12	4962	1	2.15	165.1
4962 Adit	631484.06	8416739.07	4962	1	1.56	74.76
4962 Adit	631484.19	8416738.04	4962	1	1.71	183.79
4962 Adit	631484.21	8416737.05	4962	1	2.87	383.15
4962 Adit	631481.53	8416745.94	4962	1	1.31	43.61
4962 Adit	631481.69	8416744.96	4962	1	1.18	43.61
4962 Adit	631481.67	8416743.92	4962	1	3.77	283.47
4962 Adit	631481.55	8416742.92	4962	1	2.74	133.95
4962 Adit	631481.66	8416741.93	4962	1	2.21	121.49
4962 Adit	631481.98	8416740.92	4962	1	1.87	84.11
4962 Adit	631482.2	8416739.98	4962	1	1.87	165.1
4962 Adit	631482.34	8416738.95	4962	1	3.64	330.19
4962 Adit	631482.22	8416737.9	4962	1	8.72	193.13
4962 Adit	631482.22	8416736.89	4962	1	3.68	109.03
4962 Adit	631482.84	8416728.98	4962	1	1.87	118.37
4962 Adit	631482.81	8416728	4962	1	1.12	158.87
4962 Adit	631482.83	8416726.99	4962	1	1.59	37.38
4962 Adit	631482.97	8416725.98	4962	1	5.95	15.58
4962 Adit	631483.08	8416725	4962	1	1	59.19
4962 Adit	631483.21	8416723.99	4962	1	1.18	214.94
4962 Adit	631483.37	8416721.99	4962	1	1.12	15.58
4962 Adit	631483.37	8416720.99	4962	1	1.37	12.46

PAGE 27

Laconia Resources – September 2012 Quarterly Report

4962	Adit	631483.36	8416720	4962	1	1.65	24.92
4962	Adit	631484.6	8416729.12	4962	1	2.27	84.11
4962	Adit	631484.71	8416728.14	4962	1	1.09	124.6
4962	Adit	631485	8416725.14	4962	1	0.03	190.02
4962	Adit	631485.54	8416720.16	4962	1	0.03	137.06
4962	Adit	631482.38	8416735.97	4962	1	2.21	199.36
4962	Adit	631482.51	8416734.96	4962	1	2.31	158.87
4962	Adit	631482.6	8416733.98	4962	1	1.37	133.95
4962	Adit	631482.76	8416732.97	4962	1	0.5	202.48
4962	Adit	631484.28	8416736.11	4962	1	3.05	190.02
4962	Adit	631484.34	8416735.08	4962	1	2.18	236.74
4962	Adit	631484.46	8416734.14	4962	1	0.31	193.13
4962	Adit	631484.55	8416733.11	4962	1	0.22	186.9
4962	Adit	631482.7	8416729.99	4962	1	0.12	124.6
4962	Adit	631482.63	8416711.86	4962	1.5	1.78	193.13
4962	Adit	631484.53	8416711.91	4962	1.5	11.68	236.74
4962	Adit	631484.78	8416708.59	4962	1.5	1.12	18.69
4962	Adit	631485	8416706.85	4962	1.5	1.5	37.38
4962	Adit	631485.67	8416716.84	4962	1	2.31	763.18
4962	Adit	631485.71	8416715.88	4962	1	0.9	305.27
4962	Adit	631485.89	8416714.82	4962	1	0.59	68.53
4962	Adit	631486.39	8416712.9	4962	1	0.78	451.68
4962	Adit	631486.5	8416711.91	4962	1	0.97	149.52
4962	Adit	631486.43	8416710.93	4962	1	1.59	143.29
4962	Adit	631486.76	8416706.94	4962	1	3.4	271.01
4962	Adit	631483.38	8416716.7	4962	1	0.37	513.98
4962	Adit	631483.58	8416715.69	4962	1	0.62	224.28
4962	Adit	631483.76	8416714.68	4962	1	1.21	233.63
4962	Adit	631483.87	8416713.7	4962	1	0.69	152.64
4962	Adit	631484.05	8416712.74	4962	1	9.41	448.56
4962	Adit	631484.01	8416711.71	4962	1	2.21	80.99
4962	Adit	631484.77	8416706.78	4962	1	1.31	149.52
4962	Adit	631485.6	8416717.94	4962	1	0.19	137.06

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Laconia Resources – September 2012 Quarterly Report

4962	Adit	631483.31	8416718.76	4962	1	0.09	127.72
4962	Adit	631483.31	8416717.73	4962	1	0.03	165.1

Note 1: Sample results are compiled as weighted averages. Sample ID shown is for the first sample in the sequence. Samples were collected by Buenoventura between 1997 and 1999, and assayed at Intertek Bondar Clegg Bolivia. Gold (Au) was analysed by AAS with Fire Assay checks on 50 g aliquots to 2 ppb detection limits and AAS was used for Silver (Ag). All assays are available with original lab certificates from Intertek Bondar Clegg in Bolivia. Normal lab QAQC was done, and show no issues in quality.

Note 2: Coordinate system used is PSAD56/UTM zone 18S EPSG 24878

Appendix 2: Surface sampling Marcelita and Elsa Breccia

Sample	Prospect	Easting	Northing	Elevation	Length	Au	Ag
ID						(g/t)
							(g/t)
23885	Elsa Breccia	632595.0	8415082.0	4769	1.5	22.80	45.20
23886	Elsa Breccia	632597.0	8415082.0	4770	1.5	2.16	85.30
23887	Elsa Breccia	632596.0	8415072.0	4769	1.5	14.76	208.00
23888	Elsa Breccia	632598.0	8415072.0	4770	1.5	2.36	34.50
23889	Elsa Breccia	632602.0	8415072.0	4771	1.5	9.56	145.50
23890	Elsa Breccia	632596.0	8415060.0	4768	1.5	1.05	8.60
23892	Elsa Breccia	632600.0	8415060.0	4770	1.5	1.00	35.80
23895	Elsa Breccia	632606.0	8415060.0	4772	1.5	5.79	17.50
23896	Elsa Breccia	632608.0	8415060.0	4772	1.5	5.25	47.50
23897	Regional	632640.0	8415133.0	4785	1.5	1.05	16.00
23861	Veta Marcelita	632458.0	8415086.0	4712	0.65	0.27	207.00
23863	Veta Marcelita	632460.0	8415086.0	4713	1.1	1.01	40.90
23864	Veta Marcelita	632459.0	8415075.0	4713	1.2	2.59	268.90
23865	Veta Marcelita	632467.0	8415045.0	4717	1.4	5.48	117.50
29001	Veta Marcelita	632450.0	8415163.8	4699	1	0.89	117.10
29002	Veta Marcelita	632451.0	8415148.8	4702	1.2	0.69	229.00
29003	Veta Marcelita	632451.0	8415144.5	4703	1.1	0.31	84.10
29005	Veta Marcelita	632450.0	8415134.7	4703	0.8	0.57	61.20
29006	Veta Marcelita	632447.5	8415118.7	4704	0.9	3.49	819.40
29007	Veta Marcelita	632448.5	8415118.9	4705	1.2	0.65	181.60
29008	Veta Marcelita	632450.5	8415119.1	4706	1	0.38	249.00
29009	Veta Marcelita	632451.0	8415107.6	4708	1	0.30	171.30

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Laconia Resources – September 2012 Quarterly Report

29010	Veta Marcelita		632464.0	8415089.0	4714	1.3	1.14	40.50
29013	Veta Marcelita		632486.0	8415050.0	4726	0.9	1.01	86.70
29014	Veta Marcelita		632489.0	8415048.0	4728	1.2	2.50	284.00
29015	Veta Marcelita		632502.0	8415043.0	4731	1.15	0.65	180.10
29016	Veta Marcelita		632500.0	8415041.0	4730	1.1	2.05	71.60
29017	Veta Marcelita		632498.0	8415039.0	4729	0.95	3.84	143.90
29018	Veta Marcelita		632495.0	8415037.0	4727	0.85	1.38	89.30
23872	Veta Marcelita	1	632547.5	8415259.6	4708	1	4.88	105.50
23873	Veta Marcelita	1	632549.2	8415242.8	4718	1	4.39	37.50
23876	Veta Marcelita	1	632553.0	8415193.0	4741	1	2.69	51.50
23877	Veta Marcelita	1	632551.6	8415148.6	4742	1	0.27	64.10
23878	Veta Marcelita	1	632549.6	8415148.7	4741	1	0.20	70.40
23881	Veta Marcelita	1	632546.5	8415092.1	4750	0.4	0.06	83.00
23903	Veta Marcelita	2	632727.7	8415271.5	4807	3.50	6.53	244.66
23904	Veta Marcelita	2	632731.3	8415243.2	4815	2.40	7.03	28.63
23907	Veta Marcelita	2	632732.6	8415209.8	4823	0.50	1.24	2.55
23909	Veta Marcelita	2	632734.0	8415196.5	4827	1.00	2.35	6.24
23914	Veta Marcelita	2	632743.6	8415141.3	4826	0.50	10.96	17.58
23917	Veta Marcelita	2	632747.2	8415125.1	4825	3.60	17.31	7.17
23921	Veta Marcelita	2	632748.2	8415108.8	4824	0.70	7.13	8.51
23926	Veta Marcelita	2	632752.4	8415096.5	4823	1.50	1.13	98.54
23933	Veta Marcelita	2	632751.4	8415050.8	4820	0.60	0.13	2078.62

Note 1: Sample results are compiled as weighted averages. Sample ID shown is for the first sample in the sequence. Samples were collected by Buenoventura between 1997 and 1999, and assayed at Intertek Bondar Clegg Bolivia. Gold (Au) was analysed by AAS with Fire Assay checks on 50 g aliquots to 2 ppb detection limits and AAS was used for Silver (Ag). All assays are available with original lab certificates from Intertek Bondar Clegg in Bolivia. Normal lab QAQC was done, and show no issues in quality.

Note 2: Coordinate system used is PSAD56/UTM zone 18S EPSG 24878

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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

LACONIA RESOURCES LIMITED

ABN 29 137 984 297	Quarter ended (“current quarter”)
29 137 984 297	30 September 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 (R&D Tax Refund/GST) Net Operating Cash Flows	Current quarter $A’000	Year to date (3 months) $A’000
	(434) ‐ ‐ (177) ‐ 7 ‐ ‐ 153	(434) ‐ ‐ (177) ‐ 7 ‐ ‐ 153
	(451)	(451)
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)	‐ ‐ (31) ‐ ‐ ‐ (210) ‐ ‐	‐ ‐ (31) ‐ ‐ ‐ (210) ‐ ‐
	(241)	(241)
	(692)	(692)

• 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)	(692)	(692)
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 (Capital Raising Costs) Net financing cash flows	473 ‐ ‐ ‐ ‐ (120)	473 ‐ ‐ ‐ ‐ (120)
	353	353
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	(339) 922 ‐	(339) 922 ‐
	583	583

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

1.23 1.24	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
			137
			‐
1.25 Explanation necessaryfor an understandingof the transactions Item 1.23 includes aggregate amounts paid to directors including salary, director’s fees, consulting fees and superannuation 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 N/A 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest N/A		Explanation necessaryfor an understandingof the transactions
		Item 1.23 includes aggregate amounts paid to directors including salary, director’s fees, consulting fees and superannuation
	N/A
	Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest
	N/A

Financing facilities available

Add notes as necessary for an understanding of the position.

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	‐	‐
	‐	‐

Estimated cash outflows for next quarter

4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration	$A’000
	350
	‐
	‐
	150
Total	500

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as	Current quarter	Previous quarter
shown in the consolidated statement of cash flows)	$A’000	$A’000
to the related items in the accounts is as follows.
5.1 Cash on hand and at bank	35	361
5.2 Deposits at call	548	561
5.3 Bank overdraft	‐	‐
5.4 Other (provide details)	‐	‐
Total: cash at end of quarter(item 1.22)	583	922

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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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 note3) (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 through returns of capital, buy‐ backs, redemptions
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy‐ backs	181,268,761	154,763,761
	23,463,751	23,463,751	$0.02	$0.02
7.5 +Convertible debt securities (description)	1 Convertible Note, (escrowed to 20 June 2013) with an aggregate face value of $650,000 convertible as to principal to 6,500,000 Shares at a conversion price equal to $0.10 per Share and attracting interest at the rate of 10% per annum). The Note expires on 20June 2014.

• See chapter 19 for defined terms.

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7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted	1
7.7 Options (description and conversion factor) 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter	3,000,000 200,000 400,000 20,500,000	‐ ‐ ‐ ‐	Exercise price 20 cents 15 cents 8 cents 20 cents	Expiry date 31 March 2013 31 August 2013 16 May 2014 30 September 2014
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 4).

• 2 This statement does give a true and fair view of the matters disclosed.

==> picture [123 x 46] intentionally omitted <==

Sign here: ................................................Date: 31 October 2012 (Company secretary) Print name: Matthew Edmondson

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.

• See chapter 19 for defined terms.

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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.

== == == == ==

• See chapter 19 for defined terms.

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