Firestone Energy Limited (JSE:FSE) News - Mining exploration entity and oil and gas exploration entity quarterly report FIRESTONE ENERGY LIMITED (Incorporated in Australia) (Registration number ABN 058 436 794) Share code on the JSE Limited: FSE Share code on the ASX: FSE ISIN: AU000000FSE6 FSE01 – ISIN: AU0000FSE02 (SA company registration number 2008/023973/10) (“FSE” or “the Company”) Rule 5.5 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/2013 Name of entity Firestone Energy Limited ABN Quarter ended (“current quarter”) 71 058 436 794 30 June 2016 Consolidated statement of cash flows Current quarter Year to date Cash flows related to operating activities $A’000 (12.months) $A’000 1.1 Receipts from product sales and related debtors - - 1.2 Payments for (a) exploration & evaluation - - (b) development - - (c) production - - (d) administration (66) (541) 1.3 Dividends received - - 1.4 Interest and other items of a similar nature received - 2 1.5 Interest and other costs of finance paid (69) (279) 1.6 Income taxes paid - - 1.7 Other – GST and VAT receipts 2 111 Net Operating Cash Flows (133) (707) Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects - - (b) equity investments - - (c) other fixed assets - - + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 1 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report 1.9 Proceeds from sale of: (a) prospects - - (b) equity investments - - (c) other fixed assets - - 1.10 Loans to other entities (20) (752) 1.11 Loans repaid by other entities - - 1.12 Other – net refund of rehabilitation bond - 1,178 Net investing cash flows (20) 426 1.13 Total operating and investing cash flows (carried forward) (153) (281) 1.13 Total operating and investing cash flows (brought forward) (153) (281) Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, convertible notes, etc. - 358 1.15 Proceeds from sale of forfeited shares - - 1.16 Proceeds from borrowings 148 515 1.17 Repayment of borrowings - (597) 1.18 Dividends paid - - 1.19 Other - - Net financing cash flows 148 276 Net increase / (decrease) in cash held (5) (5) 1.20 Cash at beginning of quarter/year to date 5 6 1.21 Exchange rate adjustments to item 1.20 - (1) 1.22 Cash at end of quarter - - Payments to directors of the entity, associates of the directors, related entities of the entity and associates of the related entities Current quarter $A'000 1.23 Aggregate amount of payments to the parties included in item 1.2 - 1.24 Aggregate amount of loans to the parties included in item 1.10 - 1.25 Explanation necessary for an understanding of the transactions Non-cash financing and investing activities 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows + See chapter 19 for defined terms. Appendix 5B Page 2 01/05/2013 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report None 2.2 Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest Financing facilities available Add notes as necessary for an understanding of the position. Amount available Amount used $A’000 $A’000 3.1 Loan facilities 6,564* 4,225 3.2 Credit standby arrangements * The Company has in place a project funding loan with its major shareholder The Waterberg Coal Company Limited (A$6m) and also had bridging finance (A$425k), loans from a director-related entity (A$31k) and other loans (A$108k). Estimated cash outflows for next quarter $A’000 4.1 Exploration and evaluation - 4.2 Development - 4.3 Production - 4.4 Administration 65 Total 65 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 - 5 5.2 Deposits at call - - 5.3 Bank overdraft - - + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 3 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report 5.4 Other (provide details) - - Total: cash at end of quarter (item 1.22) - 5 Changes in interests in mining tenements and petroleum tenements Tenement Nature of interest Interest at Interest at reference (note (2)) beginning end of and of quarter quarter location 6.1 Interests in mining Nil tenements and petroleum tenements relinquished, reduced or lapsed 6.2 Interests in mining Nil tenements and petroleum tenements acquired or increased 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 Amount paid up security (see per security (see note 3) (cents) note 3) (cents) 7.1 Preference Nil Nil +securities (description) 7.2 Changes during Nil Nil quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs, redemptions 7.3 +Ordinary 3,586,540,881 3,586,540,881 Fully paid securities 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs + See chapter 19 for defined terms. Appendix 5B Page 4 01/05/2013 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report 7.5 +Convertible Unlisted Conversion Repayment debt Convertible number into dates securities Notes shares (description) Ariona Con Note – Company SA A$5million 200,000,000 30 January 2017 BBY Nominees Con Note – Pty Ltd A$22.145million 885,800,000 30 January 2017 Four Oaks Con Note – 475,971,429 At Call Credit Fund US$2.7million Limited 7.6 Changes during Unlisted Conversion Repayment quarter Convertible number into dates (a) Increases Notes shares through issues Four Oaks Credit Fund Limited (b) Decreases through securities matured, converted 7.7 Options Total number Number quoted Exercise price Expiry date 2,000,000 - 0.01 30 April 2017 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Expired during quarter 7.11 Debentures (totals only) 7.12 Unsecured notes (totals only) + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 5 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Compliance statement 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5). 2 This statement does give a true and fair view of the matters disclosed. Sign here: ......... Date: 29 July 2016 Lee Boyd Company Secretary Notes 1 The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report. 2 The “Nature of interest” (items 6.1 and 6.2) includes options in respect of interests in mining tenements and petroleum tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement or petroleum tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2. 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities. 4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. 5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with. == == == == == + See chapter 19 for defined terms. Appendix 5B Page 6 01/05/2013 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Appendix 1 – Interests in mining tenements held Tenement table The Company’s interest in the Waterberg Coal Project, located in South Africa: Properties Right under Relevant Holder Interest at Issue Date Expiry Date which the Joint Beginning properties Venture and End of are held Quarter Vetleegte Vetleegte First Joint Uzalile 37.39% Granted Renewal lodged 19 Prospecting Venture Joint New Order September 2011 and Right Venture Prospectin prior to the expiry (Sekoko g Right No. date. Resources 651/2006, and Uzalile) on Section 18(5) of the 19/10/06 MPRDA provides that prospecting right in respect of which an application for renewal has been lodged will remain in force until such time as the renewal application has been granted or refused. Olieboomsfont Duikerfontein First Joint Sekoko 37.39% Granted 3 July 2016 ein Prospecting Venture Coal New Order Right Prospectin g Right No. 681/2007, on 13/10/05. Renewal on 3 July 2013 Duikerfontein Duikerfontein First Joint Sekoko 37.39% Granted 3 July 2016 Prospecting Venture Coal New Order Right Prospectin g Right No. 681/2007, on 13/10/05. Renewal on 3 July 2013 Swanepoelpan Duikerfontein First Joint Sekoko 37.39% Granted 3 July 2016 Prospecting Venture Coal New Order Right Prospectin g Right No. 681/2007, on 13/10/05 Smitspan Mining Right Second Sekoko 37.39% Granted 16/09/2041 Joint Venture Coal New Order Mining Right No. 22/2011, on 17/09/11 Massenberg Mining Right Second Sekoko 37.39% Granted 16/09/2041 Joint Venture Coal New Order + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 7 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Mining Right No. 22/2011, on 17/09/11 Minnasvlakte Mining Right Second Sekoko 37.39% Granted 16/09/2041 Joint Venture Coal New Order Mining Right No. 22/2011, on 17/09/11 Hooikraal Mining Right Second Sekoko 37.39% Granted 16/09/2041 Joint Venture Coal New Order Mining Right No. 22/2011, on 17/09/11 + See chapter 19 for defined terms. Appendix 5B Page 8 01/05/2013 Date: 05/08/2016 01:57:00 Produced by the JSE SENS Department. 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