ZEOTECH LIMITED — Interim / Quarterly Report 2012

Jan 24, 2013

25 January 2013

Summary & Highlights for the December Quarter 2012

Additional Gold-Silver Targets at Rasuhuilca Project, Peru

Laconia Resources Ltd

ASX Code: LCR ABN: 29 137 984 297

www.laconia.com.au

Capital Structure

274.7 million shares (26.5 million escrowed)

73.6 million unlisted options

• Further high-grade targets identified at the Hyallatas Prospect o 6m @ 3.59g/t Gold and 225.43g/t Silver (composite) o 4m @ 2.06g/t Gold and 301.63g/t Silver (composite) o 1m @ 1.12g/t Gold and 1041.70g/t Silver o 1.5m @ 2.31g/t Gold and 604.90g/t Silver

• Extension of high-grade silver zone identified at the Olga Vein; o 1.1m @ 6.29g/t Gold and 89.87g/t Silver o 0.7m @ 10.10g/t Gold and 101.3g/t Silver o 2.5m @ 5.08g/t Gold and 65.78g/t Silver o 0.7m @ 5.70g/t Gold and 441.0g/t Silver

Exploration tenement position expanded at the Rasuhuilca Project

• In November, Laconia agreed to formalise a seven year Option Agreement over 5,622 hectares of additional contiguous exploration licences;

• Immediately adjacent to its current 2,765ha Rasuhuilca Project;

• Providing complete access to the entire surrounding epithermal volcanic system considered highly prospective for gold, silver and copper mineralisation

Board of Directors

Matthew Howison Chairman

Ian Stuart Managing Director

Dr. Saliba Sassine Non-Executive Director

Vincent Algar Non-Executive Director

Company Secretary

Matthew Edmondson

• Option Agreement will allow Laconia to acquire 80% interest in 11 licences

• Due Diligence in progress and on-track for 31 January completion

• Nick Shakesby appointed as Chief Operating Officer, Peru

Corporate

• Binding Term Sheet for an additional 11 tenements (5,622ha) adjacent to the Rasuhuilca Project completed

• Divestment of Kookynie Project

• Rationalisation of Western Australian tenements

• Closed rights issue as announced on 17 October 2012

Planned Activities for March 2013 Quarter

• Rasuhuilca Project Feasibility Study (2008) review underway due for completion in March Quarter 2013

• Finalise approval to undertake a diamond drilling program (2,200m) at Rasuhuilca Project, to validate and extend the existing underground resource potential,

• Geological review of additional tenement package

• Completion of community consultation and approval process

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Rasuhuilca Gold-Silver Project, Southern Peru

(100% Laconia)

During the quarter ended 31 December 2012, Laconia Resources Limited (ASX:LCR) (the Company) was pleased to have built on significant progress already made at the Rasuhuilca Project with additional encouraging historical exploration results.

During the quarter, Laconia also took steps to expand its footprint in the highly prospective Andean volcanic arc of southern Peru. Laconia has agreed to enter into an Option Agreement to acquire an 80% interest in 11 licences across 5,622 hectares immediately adjacent to its current 2,765 hectare Rasuhuilca Project.

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. Similar to the Company's 100%-controlled Rasuhuilca Project, the new licences are considered highly prospective for epithermal and porphyry style gold-silver-copper mineralisation. The option period is for seven years and involves minimal initial outlay[1] .

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Figure 1: Diagram showing location of Laconia's current Project and new earn-in option licence outlines. Stipple boundaries show areas of intense alteration and primary exploration targets.

1 Refer to ASX Release 7 November 2012.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Laconia will earn an 80% interest in the licences following execution of the Option Agreement and by completing undertakings in the Binding Term Sheet including final option exercise payment and completion of a Detailed Feasibility Study.

The material terms of the Binding Term Sheet, including the undertakings referred to above, are summarised below. By mutal consent, the option period in the formal agreement is proposed to be a five year term.

• Seven year Option Agreement to acquire an 80% interest in 11 licences;

• Up-front consideration of US$150,000 comprising US$60,000 paid upon execution of the Binding Term Sheet and the balance of US$90,000 payable upon execution of a formal Option Agreement;

• Five annual option payments to the vendors of a minimum of US$250,000 and maximum of US$300,000 commencing in 2014, calculated by an agreed mechanism linked to the degree of the positive percentage increase in the price of gold;

• The remaining 20% interest in the licences held by the vendors will be free carried until completion of a Detailed Feasibility Study;

• Final option exercise payment to acquire the 80% interest of a minimum of US$5M and a maximum of US$6M, calculated by an agreed mechanism linked to the degree of the positive percentage increase in the price of gold;

• Post-acquisition, the vendors will retain a 2.25% net smelter royalty;

• Laconia is to spend $1.3M per annum towards exploration on the licences commencing in 2015 for four consecutive years;

• Laconia is to complete satisfactory due diligence at its absolute discretion before entering into the Option Agreement to replace the Binding Term Sheet by 30 January 2013;

• Laconia to manage and operate the exploration program upon execution of a formal Option Agreement, whereby an Exploration Program Board will be formed between the vendor and Laconia and will agree the overall exploration plan and program; and

• Laconia may terminate the Option Agreement at any time.

The formal Option Agreement will be subject to all necessary regulatory approvals.

Ongoing exploration data review

During the quarter, the Company’s continuing data review of high quality exploration, undertaken by previous owners Cominco and Buenaventura, identified additional exploration targets both on the extension of the existing Rasuhuilca vein system, (the Hyallatas Prospect), and also the Olga Prospect, a vein system that lies 1.5km to the north west of the Rasuhuilca resource[2] . Throughout the ongoing review, specific emphasis is being placed on the potential expansion of the existing resource at Rasuhuilca and the surrounding project area. The project currently has an Inferred Resource estimate of 360,000t @ 1.97g/t gold and 179g/t silver (at a 2.5g/t gold-equivalent cut-off[3] ).

These new targets at Hyallatas and Olga build on the exploration targets identified in the September Quarter, namely extensions of the existing Rasuhuilca vein system on margins of the current resource at Rasuhuilca and 4.5km away at the Marcelita vein system[4] . The Company is placing specific emphasis on its exploration activities to expand the existing gold and silver resources at the Rasuhuilca vein and across the entire project area.

2 Refer to ASX Release 13 November 2012.

3 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.

4 Refer to ASX Release 16 August 2012.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

The Company completed the acquisition of the Rasuhuilca advanced gold-silver development project in Peru in June 2012[5] and has made significant progress towards potentially expanding the current resource in a short timeframe and utilising effective low cost exploration methods. 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.

Rasuhuilca Project Target Generation

Laconia is continuing to review previous exploration work undertaken at Rasuhuilca, with a number of new high quality exploration targets being successfully generated. These targets are based on surface and/or underground adit sampling, or are conceptual targets based on the literature research phase for High Sulphidation Epithermal deposits and Andean Porphyry Copper/Gold deposits. Figure 2 shows the current target areas, with labels describing each one. Rock chip surface sampling discussed in this report was conducted by Buenaventura between 1997 and 2004.

Identified Targets

Target Area 1, the Olga Prospect, has surface sampling and 82m of underground development. The mineralisation is hosted in a planar vein structure, and has the potential for a strike length of 240m, as indicated by surface sampling.

Target Areas 2 and 3 are targets with very little surface sampling or data but are conceptual targets for high tonnage, disseminated mineralisation, based on the literature for High Sulphidation Epithermal deposits. Further information on these targets' potential is being compiled.

Target 4 , the Hyallatas Prospect, is based on the extension of the vein system at the Rasuhuilca Vein itself, which hosts the Projects' current JORC resource and is discussed in this release.

Targets 5 and 6 are based on encouraging surface sampling results, which are in the process of being verified by field inspection.

Target 7 , the Marcelita Prospect, is located 4.5km to the southeast of the Rasuhuilca vein system, and was previously discussed in the announcement dated 16 August 2012.

The most significant outcome from the data review and target generation phase has been recognition that there is gold enrichment, in a very high proportion of all surface samples collected by Cominco, Buenaventura and Cambridge Mineral Resources over the Rasuhuilca Project area, highlighting the outstanding development potential of the asset.

5 Refer to ASX Release 1 June 2012.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

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Figure 2: Prospects and Targets Rasuhuilca Project.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Target 1 – Olga Prospect

Olga Prospect is a vein system that lies 1.5km to the northwest of the Rasuhuilca resource. The system is similar to the Rasuhuilca vein, and is comprised of a zone of silicification, with internal fracturing, and fine barite throughout. The sulphides are weathered to goethite and jarosite at surface, and zones of hydrothermal breccia occur sporadically throughout the vein. There are at least two phases of silicification with an earlier episode of silicification that now occurs as clasts within the breccias, plus a phase of silica formed as chalcedony with close-association to the fine barite mineralisation.

The veining at Olga is linear, striking east–west, and dipping steeply to the north. The vein has an average thickness of 2.5m, as shown by mapping in the underground development adit, the 4795 level. The current measured strike length of the vein in the underground development adit at Olga Vein is 82m, and contains gold and silver mineralisation extending along the drive which lies on average 25m below the surface expression of the vein. Surface sampling and mapping of the vein cropping out on the hillside above the drive, suggests a potential strike length of 240m.

Composite surface sampling undertaken across 22m of channel samples returned a weighted average grade of 2.9g/t gold, and 116g/t silver. Composite underground sampling over 50m of channel samples, returned a weighted average grade of 2.22g/t gold and 65g/t silver. Figure 3 shows the surface expression of the Olga vein, with higher-grade samples annotated. There is also an Inset in Figure 3 that shows the underground adit development, and channel sample locations. All significant samples from the Olga Prospect are included in Appendix 1 (gold >1g/t and/or silver >60g/t).

Typically, there are modest grades throughout the vein and silicification system, with some samples returning higher grades (greater than 5g/t gold, plus greater than 60g/t silver). Previous sampling specifically targeted veins and structures, but future sampling will include altered wall rocks which also carry elevated gold and silver grades. The mineralisation at the Olga Prospect is currently being evaluated for potential to provide additional tonnages of ore-grade material that may supplement the millfeed produced from the Rasuhuilca Mine, once operational.

Future exploration at the Olga prospect will focus on extension of the known mineralisation dimensions, using diamond drilling. There is scope for extending the zone to the west, as there are good results returned from historic surface rock chip samples 115m to the west of the end of the current adit. Sampling in the underground adit indicates the drive was stopped in mineralisation.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

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Figure 3: The Olga Prospect, with Surface Sampling and Underground Adit Sampling shown.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Target 4 – Rasuhuilca Strike Extension – Hyallatas Prospect

Previous owners of the Rasuhuilca Project undertook sampling of the western extension of the Rasuhuilca vein. The historical data contains mapping and sporadic rock chip sampling of the Rasuhuilca vein structure for a further 520m to the west of the current resource.

Buenaventura collected 134 rock chip samples from the continuation of the vein, and other structures leading off the main vein. Of these samples, 69 returned values greater than 1g/t of gold, and/or greater than 60g/t of silver. These samples were collected over about 100m of the vein extension, with many other samples being collected on breccia systems, or cross-cutting faults, leaving at least 420m of the main vein yet to be sampled.

The sampling at the Hyallatas prospect has returned many significant results for silver, with a peak sample of 1,041g/t of silver in sample 23844 (See Figure 4). Gold values are generally all elevated (greater than 0.1 g/t), and the weighted average of all the gold grades from the surface sampling is 1.17g/t. Silver grades compiled as weighted averages over the total sample length average at 78.18g/t. The historic sampling has been restricted to areas of brecciation, silicification, silica-alunite alteration, veining and fault zones. Between each of the sampled zones, there are large areas of scree, Andesite and Intermediate Tuff. Some higher-grade samples and composite values from the Hyallatas Prospect illustrate the further potential of the vein system;

• 6m @ 3.59g/t Gold and 225.43g/t Silver (composite)

• 4m @ 2.06g/t Gold and 301.63g/t Silver (composite)

• 1m @ 1.12g/t Gold and 1041.70g/t Silver

• 1.5m @ 2.31g/t Gold and 604.90g/t Silver

All significant samples from sampling along the western extension of the Rasuhuilca vein are included in Appendix 2 (gold >1g/t and/or silver >60g/t).

Future exploration will consist of rock chip sampling the remaining strike. Some re-sampling of historic rock chips will also be undertaken to confirm the tenor of the assaying by Buenaventura. Future sampling programs will include all rock types to determine the back ground values for gold and silver. Detailed mapping of the structures in the area will also be completed, to identify cross-cutting structures that could be mineralised and dilational zones where the vein thickness may be increased.

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Figure 4: High-grade surface sampling results at the Hyallatas Prospect.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Work Completed at the Rasuhuilca Project during the December Quarter 2012

• Continuing consultation with community groups

• Identification of additional exploration targets of high-grade silver zones on the extension of the existing Rasuhuilca vein system, the Hyallatas Prospect, and also the Olga Prospect, a vein system that lies 1.5km to the northwest of the Rasuhuilca resource

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

About the Rasuhuilca Project

The Rasuhuilca Project is located approximately 500km southeast of the Peruvian capital, Lima, in the southern part of the country (see Figure 6). It is an advanced, high-grade gold and silver project with near-term development potential and 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 gold and 179g/t silver (at a 2.5g/t gold-equivalent cut-off[6] ).

This Resource statement is based on historical data and classified as Inferred Resource as there was a lack of independent QA/QC data available at the time of resource estimation. Independent sampling has since been completed by Laconia[7] (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.

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. Laconia aims to target the following mineralisation styles:

• The network of outcropping gold-silver veins in lower temperature acidic outflow zones (silicaalunite-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 will commence upon receipt of approval from Peruvian authorities. Approvals are expected this quarter. In the interim, the drilling program will be reviewed in light of a regional review incorporating the new tenement package currently being finalised at the moment. It is likely the drilling program will be expanded to test targets identified by the data review. The drilling scope required for permitting has been expanded and lodged with the relevant 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

6 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.

7 Refer to ASX Release 4 July 2012.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

grow the resource base and plans to test the Rasuhuilca vein both along strike and down dip in this program.

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Figure 5: Long section of Rasuhuilca resource model with current and planned development.

Mining Study

A study of the economics of an underground operation at Rasuhuilca was completed by 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. Mining consultancy, Optiro Pty Ltd (Optiro) are assisting with the resource and mining review as the Company updates the Rasuhuilca study document. Andrew Law, who is assisting with 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.

This review is ongoing with initial results due before at the end of the March Quarter 2013.

The 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 to be provided from other vein systems nearby. These nearby vein systems will be subject to upcoming exploration activity.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

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Figure 6 : Rasuhuilca Project location map.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Australian Exploration Activities

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

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

Preliminary Economic assessment of the Lennons Find Base Metal Project

A preliminary economic assessment of the known oxide resource at Lennons Find has been conducted[8] . These details were released in Laconia’s September Quarter 2012 report and for clarity reiterated below.

Consistent with Laconia’s strategy to focus its exploration efforts on the advancement and development of the Rasuhuilca Project Gold Silver project in Southern Peru, Laconia is investigating all avenues to optimise value at the Lennons Find project. Following the optimisation work, the Company retains a positive view about the prospects of eventual economic extraction of the Lennons Find Oxide Resource. The Project lies on a granted Mining Lease, the occurrence of mineralisation within a secure mining lease title is considered a significant advantage.

About the Lennons Find Base Metal Project

The project covers 116km[2] of Archaean terrain and is located approximately 40km 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 metal 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 zinc Equivalent cut-off grades[9] ) 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

8 Refer to Laconia Quarterly Report September 2012.

9 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 – January 2013 ASX/Media Release December 2012 Quarterly Report

	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 Sulphide1,400,000 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 1: 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 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 December Quarter 2012

• Ongoing appraisal of all options to advance the Lennons Find Project.

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[10] ;

• 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) o 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.

10 Refer to ASX Release 15 March 2012.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

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 consulting firm Optiro 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

• Recovery- Ag 92.1%, Au 80.4%, Cu 41.6%

Two price scenarios were considered (see Table 2).

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

Table 2: 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 3: Results of pit optimisation of Lennons Find oxide resource.

Note 1: *Value quoted for NPV is 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.

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

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.

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.

Yandicoogina Project (E45/3293)

No work was completed at Yandicoogina during the quarter.

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 @ 1.1g/t gold for 674,300 ounces of contained gold[11] .

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 during the quarter at the 701 Mile Project.

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

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Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Mooletar Iron Ore Project, Mount Magnet, WA

(100% Laconia)

E58/391, M58/110, P58/865, P58/1055-1056, P58/1385-1388, P58/1408-1411, P58/1495, P58/1499, M58/266 (application), M58/349 (application)

During the quarter, a rationalisation of the licences at Mooletar was undertaken. This included the reduction of a number of Prospecting licences to reduce the overall administrative overhead, and focus the licences suite to the prospective magnetite horizon. In addition, the Company completed the acquisition of E58/391, adding 5km of strike length to the current known magnetite horizon. The new licence addition has not been explored using modern geochemical techniques for gold mineralisation despite its close proximity to the Mt Magnet goldfield. The company has chosen to rationalise its position at Mooletar to reduce holding cost and maximise exposure to gold and magnetite potential.

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 39.3km[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[12] . 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[13] .

Results from Davis Tube Recovery (DTR) test work[14] 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.

==> picture [247 x 156] intentionally omitted <==

Figure 7: Mooletar Project location and regional infrastructure (present and proposed).

12 Refer to ASX announcement 18 November 2010.

13 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.

14 Refer to ASX announcement 17 August 2010.

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16

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

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 430km[2] . Modern exploration has been undertaken since the mid-1960s; 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.

==> picture [211 x 300] intentionally omitted <==

Figure 8: Barramine defined geochemical target locations.

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17

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Kookynie Project – Gold and Base Metals, Kookynie, Eastern Goldfields, WA

(100% Laconia)

P40/1255, P40/1256, E40/260

During the quarter Laconia completed the sale of 100% of its Kookynie Project to Rubianna Resources Limited (Rubianna, ASX: RRE)[15] .

Subsequent to the acquisition of Kookynie, Laconia has acquired a 100% in the Rasuhuilca Gold Silver project in Southern Peru and its exploration efforts became focused on the advancement and development of the Rasuhuilca Project.

Rubianna’s stated purpose is the exploration for gold and copper in the Murchison district of WA. Rubianna has a team of geologists in place to focus its exploration efforts on the discovery of gold and base metals in this prospective region. Rubianna's acquisition of the Kookynie project for 1,300,000 shares in Rubianna allows Laconia shareholders to retain exposure to, and gain a direct benefit from the exploration in the region.

Corporate

During the quarter, Laconia continued to review its Western Australian tenements. Consistent in its strategy to focus on the flagship Rasuhuilca Project in Peru, Laconia divested it Kookynie Project and is investigating all options to reduce costs within Australia and to rationalise its tenements to maximum benefit for shareholders.

Laconia has 670 shareholders with the top 20 shareholders holding 46% of the total issued capital.

Laconia has received a R&D tax refund of $207,000.

At the end of the Quarter, the Company had cash at bank of $1,315,000.

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

15 Refer to ASX Release 6 December 2012.

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18

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Outlook for March 2013 Quarter

Rasuhuilca Project

• Execution of final option agreement of the Huaco Cucho Project licences

• Completion of community consultation and 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 of the 2008 feasibility study for an underground gold silver mine at Rasuhuilca by the technical team at Laconia, Optiro and a Peruvian Engineering company,

• 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 and options to progress the project.

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

About Laconia Resources Limited

Laconia Resources 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 the Company’s existing portfolio of precious and base metal projects in Western Australia.

In Western Australia, the Company has a portfolio of advanced mineral projects in the Murchison and Pilbara regions, across 24 granted tenements covering an approximate 987 km2. The Company has determined JORC Compliant Resources at its Lennons Find Project, (Cu-Ag-Pb-Zn-Au), and more recently its Rasuhuilca Project in Peru (Au-Ag).

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

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19

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Competent Persons Statements

Information in this report relating to the Lennons Find, Barramine, 701 Mile, 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.

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20

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Appendix 1: Significant surface and channel sampling intersections at the Olga Prospect.

Sample ID	East	North	RL	Sample Length	Sample Type	Au_ppm	Ag_ppm
23102	630685	8417863	4818	0.60	SCN	2.0	233.7
23103	630647	8417867	4825	0.80	SCN	1.9	121.3
23104	630626	8417871	4821	1.25	SCN	1.3	37.2
23105	630621	8417873	4819	0.70	SCN	10.1	101.3
23106	630609	8417874	4810	0.60	SCN	2.5	34.0
23642	630700	8417867	4810	0.20	SCN	8.5	247.0
23690	630715	8417874	4801	1.00	SCN	1.8	56.8
23691	630716	8417873	4801	1.00	SCN	2.4	70.6
23692	630711	8417873	4803	1.20	SCN	1.8	283.6
23693	630711	8417872	4803	0.75	SCN	2.6	76.6
23694	630700	8417868	4810	0.50	SCN	1.3	8.3
23695	630685	8417861	4819	0.40	SCN	1.6	21.1
23696	630685	8417862	4819	0.60	SCN	3.6	495.1
23698	630652	8417868	4824	0.60	SCN	0.8	60.3
23700	630653	8417867	4825	0.70	SCN	5.7	441.0
23702	630647	8417866	4825	0.40	SCN	4.0	80.3
23704	630626	8417871	4822	0.60	SCN	4.1	11.8
23705	630630	8417869	4823	0.80	SCN	6.9	58.4
23706	630629	8417868	4824	0.90	SCN	2.5	54.7
23708	630618	8417873	4817	1.40	SCN	3.8	68.8
23709	630618	8417873	4817	0.80	SCN	1.1	19.3
23710	630611	8417874	4812	0.60	SCN	11.8	101.4
23713	630605	8417875	4807	0.70	SCN	1.0	20.6
23851	630597	8417872	4803	0.50	SCN	2.1	7.2
23852	630523	8417866	4761	0.60	SCN	3.0	383.8
23853	630517	8417866	4759	0.70	SCN	3.6	156.6
23854	630504	8417864	4753	0.90	SCN	1.4	282.7
42025	630714	8417875	4795	1.00	CN	0.57	78.53
42026	630712	8417874	4795	1.10	CN	6.29	89.87
42027	630710	8417873	4795	0.75	CN	1.04	50.75
42028	630709	8417872	4795	1.10	CN	1.34	28.92
42029	630706	8417872	4795	1.10	CN	1.40	43.38
42030	630705	8417871	4795	1.40	CN	1.04	43.38
42073	630703	8417869	4795	1.50	CN	2.30	86.01
42075	630701	8417868	4795	1.36	CN	5.02	93.21
42077	630700	8417867	4795	1.40	CN	2.73	94.53
42079	630698	8417866	4795	1.00	CN	3.75	41.39
42130	630695	8417866	4795	0.60	CN	2.69	161.03
42131	630694	8417864	4795	1.20	CN	1.73	70.59

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21

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Sample ID	East	North	RL	Sample Length	Sample Type	Au_ppm	Ag_ppm
42133	630691	8417864	4795	3.20	CN	0.26	69.54
42137	630688	8417865	4795	0.70	CN	2.00	41.68
42139	630684	8417863	4795	0.50	CN	1.22	26.37
42141	630680	8417862	4795	1.00	CN	4.04	324.32
42142	630679	8417862	4795	0.90	CN	2.93	91.00
42144	630677	8417863	4795	0.70	CN	5.00	72.17
42146	630675	8417864	4795	1.10	CN	1.86	52.52
42150	630672	8417865	4795	1.30	CN	3.58	74.34
42152	630670	8417866	4795	0.90	CN	1.87	60.73
42154	630668	8417866	4795	0.90	CN	1.92	75.03
42156	630666	8417867	4795	1.00	CN	1.73	42.75
42160	630662	8417868	4795	1.55	CN	1.50	40.08
42163	630660	8417869	4795	1.30	CN	1.41	22.79
42165	630658	8417870	4795	1.87	CN	1.37	15.91
42198	630656	8417870	4795	1.40	CN	1.79	27.01
42202	630651	8417868	4795	1.10	CN	2.12	15.05
42204	630649	8417868	4795	1.20	CN	5.96	68.96
42206	630648	8417866	4795	1.70	CN	2.83	26.33
42208	630646	8417865	4795	2.50	CN	5.08	65.78
42251	630711	8417873	4795	0.75	CN	1.04	27.78
42252	630710	8417873	4795	0.70	CN	3.46	77.11
42253	630701	8417867	4795	0.60	CN	4.19	66.62
42255	630692	8417864	4795	1.20	CN	3.15	91.85
42256	630690	8417866	4795	1.05	CN	2.50	306.46
42257	630678	8417864	4795	0.60	CN	0.06	102.34

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 shows no issues in quality. Note 2: Coordinate system used is PSAD56/UTM zone 18S EPSG 24878

Note 3: SCN = Surface Channel Sample; CN = Channel Sample in Underground Adit.

Note 4: Results greater than 1 g/t gold and/or 60 g/t silver are listed in this table. An additional 12 samples returned results below these levels.

Appendix 2:

Significant surface sampling intersections along the Extension of the Rasuhuilca Vein, Hyallatas Prospect.

Rockchip ID	Easting	Northing	Elevation	Length	Au g/t	Ag g/t
23714	631115	8416736	4967	1.2	1.18	26.60
23725	631153	8416759	4989	1	1.03	13.10
23731	631152	8416751	4989	1	1.06	9.10
23739	631151	8416741	4988	1	0.75	71.60
23740	631151	8416738	4987	1.2	0.51	69.80
23742	631184	8416757	5004	1.2	1.10	4.30
23748	631184	8416749	5004	1.5	2.14	14.40
23750	631184	8416746	5005	1.5	1.31	8.30

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22

Laconia Resources – January 2013 ASX/Media Release December 2012 Quarterly Report

Rockchip ID	Easting	Northing	Elevation	Length	Au g/t	Ag g/t
23751	631184	8416745	5005	1.5	1.70	17.70
23752	631184	8416744	5005	1.5	1.11	8.90
23754	631184	8416741	5005	1.5	1.59	8.00
23755	631184	8416740	5005	1.3	1.06	9.90
23757	631183	8416737	5005	1.2	1.01	5.40
23763	631197	8416754	5009	1	1.24	7.70
23769	631197	8416747	5009	1	1.60	15.90
23770	631197	8416745	5009	1	1.96	15.30
23771	631197	8416743	5009	1	6.72	42.10
23775	631288	8416761	4974	1.3	0.77	181.20
23777	631283	8416764	4973	1.5	0.86	65.00
23778	631279	8416766	4974	1.5	0.79	72.90
23779	631275	8416768	4975	1	1.49	172.60
23781	631273	8416768	4976	1	1.90	135.20
23783	631223	8416814	4991	1	1.46	12.00
23785	631221	8416820	4991	1	1.39	15.10
23786	631220	8416822	4990	1	1.99	38.80
23787	631219	8416825	4990	1	2.88	74.20
23788	631218	8416827	4991	1	1.53	25.10
23789	631217	8416829	4991	1	2.42	9.20
23790	631212	8416829	4993	1	3.45	178.00
23791	631211	8416831	4993	1	1.38	27.30
23792	631210	8416833	4993	1.5	2.10	13.70
23793	631205	8416813	5000	1	1.01	8.20
23794	631204	8416815	5000	0.9	1.65	27.90
23797	631154	8416810	4995	0.9	2.33	46.00
23798	630943	8416856	4932	1	2.46	122.10
23800	630943	8416855	4932	1	2.39	106.70
23801	630944	8416854	4932	1	2.15	94.10
23802	630945	8416853	4932	1	1.60	74.60

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 Note 3: SCN = Surface Channel Sample; CN = Channel Sample in Underground Adit. Note 4: Results greater than 1 g/t gold and/or 60 g/t silver are listed in this table. An additional 12 samples returned results below these levels.

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23

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	31 December 2012

Consolidated statement of cash flows

Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (R&D Tax Refund/GST) Net Operating Cash Flows	Current quarter $A’000	Year to date (6 months) $A’000
	(341) ‐ ‐ (558) ‐ 7 ‐ ‐ 68	(505) ‐ ‐ (1,005) ‐ 14 ‐ ‐ 221
	(824)	(1,275)
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)	(123) ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐	(123) ‐ (31) ‐ ‐ ‐ (210) ‐ ‐
	(123)	(364)
	(947)	(1,639)

• See chapter 19 for defined terms.

Appendix 5B Page 1

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Appendix 5B Mining exploration entity quarterly report

Appendix 5B Mining exploration entity quarterly report
1.13 Total operating and investing cash flows (brought forward)	(947)	(1,639)
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	1,812 ‐ ‐ ‐ ‐ (133)	2,285 ‐ ‐ ‐ ‐ (253)
	1,679	2,032
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	732 583 ‐	393 922 ‐
	1,315	1,315

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
			132
			‐
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 In addition to the above cash flows, Laconia Resources Ltd has sold the Kookynie properties (E40/260, P40/1255 and P40/1256) on a non‐cash basis, for the consideration of 1.3 million shares at $0.075 in Rubianna Resources Ltd. 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
	In addition to the above cash flows, Laconia Resources Ltd has sold the Kookynie properties (E40/260, P40/1255 and P40/1256) on a non‐cash basis, for the consideration of 1.3 million shares at $0.075 in Rubianna Resources Ltd.
	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	533	35
5.2 Deposits at call	782	548
5.3 Bank overdraft	‐	‐
5.4 Other (provide details)	‐	‐
Total: cash at end of quarter(item 1.22)	1,315	583

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
		Refer Annexure “A”	100%	0%
	E58/391 (Mooletar)	100%	0%	100%

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

	Total number	Number quoted	Issue price per security (see 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
	90,634,380 2,102,750 750,000	90,634,380 2,102,750 750,000	$0.02 $0.04 $0.03	$0.02 $0.04 $0.03
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
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
	49,500,000 (unlisted options)	‐	6 cents	30 September 2018
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.

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Sign here: ............................................................ Date: 25 January 2013 (Company secretary)

Print name: Matthew Edmondson

Notes

• See chapter 19 for defined terms.

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Appendix 5B Mining exploration entity quarterly report

• 1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

• 2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

• 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities .

• 4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.

• 5 Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

== == == == ==

• See chapter 19 for defined terms.

Appendix 5B Page 6

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Appendix 5B Mining exploration entity quarterly report

This is the Annexure marked “A” of 1 page referred to in the Appendix 5B Mining exploration entity quarterly report dated 25 January 2013.

LICENCES SURRENDERED			APPLICATIONS WITHDRAWN			LICENCES SOLD
E58/384-I	Mooletar		E45/3763	Waulkarlycarly		E40/260	Kookynie
P58/1129-I	Mooletar Pool					P40/1255	Kookynie
P58/1383-I	Mirrabarloo Hill North					P40/1256	Kookynie
P58/1384-I	Mirrabarloo Hill North
P58/1412-I	Mirrabarloo
P58/1413-I	Mirrabarloo
P58/1414-I	Mirrabarloo
P58/1415-I	Mirrabarloo
P58/1476-I	Mooleetar
P58/1477-I	Mooleetar
P58/1478-I	Mooleetar
P58/1479-I	Mooleetar
P58/1480-I	Mooleetar
P58/1481-I	Mooleetar
P58/1482-I	Mooleetar
P58/1483-I	Mooleetar
P58/1484-I	Mooleetar
P58/1485-I	Mooleetar
P58/1496-I	Mooleetar
P58/1497-I	Mooleetar
P58/1498-I	Mooleetar
P58/1500-I	Mooleetar
P58/1501-I	Mooleetar
P58/1511-I	Mooletar
P58/1583-I	Mooletar
P58/1054-I	Mooletar Pool

• See chapter 19 for defined terms.

Appendix 5B Page 7

30/9/2001