Sipa Resources Limited ABN

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1 Sipa Resources Limited ABN January 2012 ASX DECEMBER 2011 QUARTERLY REPORT HIGHLIGHTS Highly Encouraging Results Continue at Thaduna & Woodline & Sipa Cashed-up to Advance Exploration Thaduna Copper Project Six RC holes were drilled at Enigma in December, and although none reached their targeted 300 metre depths, significant mineralisation was intersected and valuable information was gained: o three 500 metre-spaced holes midway between the two previous 500 metre-spaced Aircore lines returned: 0.8% Cu, including 1.9% Cu 0.4% Cu, including 1.6% Cu, and 0.7% Cu, including 2.2% Cu thus demonstrating continuity of mineralisation between the two earlier wide-spaced lines o fine grained primary copper sulphide (chalcopyrite) in fresh rock has been intersected in two RC drill holes (THC012 and THC014). Whilst low grade (best grades 0.22% Cu in THC012 and 0.17% Cu in THC014), these primary intersections confirm copper mineralisation 700m west of the previous western Aircore drill line o a very thick intersection 141m - of fine-grained chalcopyrite in fractures and disseminations from 87 to 228 metres in THC012 is interpreted to possibly reflect a very thick dispersion halo around a higher grade mineralised system Aircore drilling is planned to recommence in early February, subject to the rain influence of approaching Cyclone Iggy, and will be aimed at:

2 o determining the, as yet only partially constrained, lateral extent of the secondary Copper Blanket, and o test for continuity of the higher grade, and thicker, parts of the Blanket by closer-spaced drilling to assess the feasibility of establishing an oxide resource A geophysical crew is also due to conduct an initial Induced Polarisation (IP) Survey, aimed at: o discovering the sulphide source, or sources, of the secondary copper beneath, or adjacent to, that Blanket, prior to more-targeted RC &/or diamond core drilling with the appropriate contractor and equipment Woodline Gold Project 5,750m, of a planned 20,000m drill programme, was completed before Christmas at two of six prospects earmarked for testing, and very encouraging results were returned from Leucippus, where: o 100m by 50m-spaced holes have outlined a 400m by 400m area of better than 0.1 g/t gold, within a larger 2 km long gold anomaly o deeper hammer drilling is about to commence results for Adiemanthus, the other prospect drilled before Christmas, are imminent the rig returned to Woodline last week to complete the programme Tennant Creek Gold and Copper Project data and geophysical images have just been received for a 2,000 line kilometre airborne magnetic and radiometric survey and are being interpreted Cash Position During the Quarter Sipa raised $9.8m through a combination of Placement and Share Purchase Plan. $5.67 was raised through the oversubscribed Share Purchase Plan, $3.2m through a Placement to sophisticated shareholders and clients of Blackswan Equities, and US$1m to Antofagasta. Sipa is well funded with $11m in the bank. 2

3 3 Figure 1 Sipa Project Locations PROJECT DESCRIPTIONS THADUNA COPPER PROJECT (Sipa 100%) Sipa has just received all analytical results for six Reverse Circulation (RC) drill holes from the Enigma Prospect drilled in December, within our 100%-owned Thaduna Copper Project in Western Australia s Gascoyne Region (see Figures 2 to 5). The six holes, which totalled 1,215 metres, were drilled as part of a planned larger programme (which was terminated early because of technical difficulties) to test the extent of the secondary copper mineralisation found at Enigma in July/August 2011, and also to search for the primary sulphide source to the secondary mineralisation. Three holes (THC009 to THC011) were drilled between the previous two aircore drill lines which intersected significant secondary copper mineralisation. Two RC drill holes (THC012 and THC013) were targeted at the northern flank of

4 the fold which hosts the previously reported secondary Copper Blanket and one RC hole (THC014) was targeted at the fold nose to the southwest of the known Copper Blanket. Five of the six holes intersected copper mineralisation, three of these intersected secondary copper carbonate (malachite), and two of these intersected primary copper sulphide mineralisation. Grades in the secondary copper mineralisation are up to 2.2% Cu over 4 metres (THC010) and widths are up to 20 metres at 0.8% Cu (THC009). Primary chalcopyrite mineralisation had best grades to 0.2% Cu over 1 metre (THC012). Importantly, this intersection of primary chalcopyrite in THC012 has anomalous copper (>300ppm Cu) almost continuously from 130 metres to 214 metres. The fine-grained chalcopyrite was logged from 87 metres to 228 metres and is hosted in dark fractures and also disseminated around these fractures in fresh dolomite. Primary chalcopyrite mineralisation in THC014 targeted at the fold nose had grades of 0.2% Cu over 6 metres. Table 1 presents results above 0.1% copper. Importantly, none of the six RC holes reached the target depth of 300 metres due to mechanical problems with the drill rig and difficult drilling conditions. Two of the three RC holes at E, which is in between the two mineralised aircore drill lines, terminated either in weathered rock (THC011) or a few metres into fresh dolomite (THC009). This means that we could not test for primary sulphide mineralisation in positions where we had best secondary copper mineralisation. Important implications, now that all the results are collated and interpreted, are: the secondary Copper Blanket has also been intersected in three RC drill holes drilled in between the previous two, 500 metre-spaced, Aircore lines 4 fine grained primary copper sulphide (chalcopyrite) in fresh rock has been intersected in two RC drill holes (THC012 and THC014). Whilst low grade (best grades 0.22% Cu in THC012 and 0.17% Cu in THC014) these primary intersections confirm copper mineralisation 700 metres west of the previous western Aircore drill line the very thick intersection of fine-grained chalcopyrite in fractures and disseminated from 87 to 228 metres in THC012 is interpreted to reflect possibly the dispersion halo around a higher grade mineralised system grades in secondary copper mineralisation are up to 2.2% over 4 metres, and thicknesses are up to 20 metres grading 0.8% Cu none of the six RC holes reached target depth of 300 metres due to mechanical problems with the drill rig and difficult drilling conditions. THC009 terminated a few metres into fresh dolomite and THC011 terminated still in weathered rock. Whilst these holes gave important information on the continuity, grade and width of the secondary

5 copper blanket between the previous aricore drill lines, this shallow termination meant that any possible primary mineralisation was not tested in these positions 5 Thaduna is located in the Paleoproterozoic Yerrida Sedimentary Basin, and has been the focus of Sipa s search for major copper deposits for the last five years. Figure 2 shows the location of Thaduna with respect to infrastructure and the current DeGrussa high grade copper-gold mine development of Sandfire Resources NL. Figure 2- Thaduna Copper Project Location Map Sipa s recent exploration focus at Thaduna has been at the Enigma Copper Anomaly, where reconnaissance RAB drilling over the last two years, on lines initially 1 kilometre apart, with some more recent infill at 500 metres, discovered a copper anomaly (above 300ppm Cu) over some 6 kilometres of interpreted strike, as shown on geochemical image 3.

6 6 Figure 3 Copper Image Part of Thaduna Project Figure 4 Enigma Copper Anomaly showing Area of Secondary Copper and Ironstone & 6 Recent RC Holes

7 7 Figure 5 Enigma Prospect Section 77,4700E Fieldwork is scheduled to recommence in early February, but the actual timing will be dependent on the extent of widespread rain being encountered in the northwest of Western Australia, as a result of Cyclone Iggy that is approaching the northwest coast. An Aircore rig is due to arrive next Thursday to: first determine the lateral extent of the secondary Copper Blanket, by deeper drilling to the east and the west which is largely unconstrained, then test for continuity of the higher grade, and thicker, parts of the Blanket by closer-spaced drilling to determine the feasibility of establishing an oxide resource A geophysical crew is also due to conduct an initial Induced Polarisation (IP) Survey, aimed at: discovering the sulphide source, or sources, of the secondary copper beneath, or adjacent to, that Blanket, prior to more-targeted RC &/or diamond core drilling with the appropriate contractor and equipment

8 8 WOODLINE GOLD AND BASEMETALS PROJECT (Sipa 100% of 485 sq.km & 70% of 248 sq. km held by Comet Resources Limited & may earn 70% of 59 sq.km held by Image Resources NL) RAB drilling recommenced at Woodline in early December as part of a planned 20,000 metre programme designed to continue testing existing prospects Leucippus, Adiemanthus, Ommaney and Cleanthes as well as first pass testing of new gold-in-calcrete anomalies Phaedrus and Leila (see Figure 6). 206 holes for 5,750 metres were drilled before the programme was temporarily halted for a Christmas break. Only Leucippus and Adiamanthus were drilled before Christmas. Drilling recommenced one week ago. Results are only to hand for Leucippus, where 110 holes for 2,928 metres has better-defined and extended that exciting gold anomaly. 100 metre by 50 metre spaced drilling has defined an approximately 400 metre by 400 metre area where many of the holes have maximum gold values greater than 0.1 g/t (Figure 7, pink dots). These high values define the core of a northwest trending gold anomaly more than 2 kilometres long. The map of maximum gold values is based on 10 metre composite samples of the entire drill hole. Table 2 presents results > 0.1g/t Au. Bottom-of-hole samples of weakly weathered rock from the final metre of each RAB hole define a more tightly constrained, but impressive, gold anomaly (Figure 8, pink & red dots). There is a hint that the highest values might be outlining east-northeast trending lodes within the overall northwest trend of the gold anomaly. A single RAB hole (WDR2107) drilled to 80 metres with a hammer bit did not intersect high grade gold mineralisation that was anticipated down-dip of holes WDR (refer Sipa 16 December 2011 ASX Announcement): WDR1817 WDR1816 WDR g/t Au, from 29 to 30 metres (bottom-of-hole sample) 1.0 g/t Au, from 26 to 27 metres (bottom-of-hole sample) 0.5 g/t Au, from 22 to 23 metres (bottom-of-hole sample) However, if high grade lodes strike east-northeast, then this hole has not properly tested the gold mineralisation. Further drilling into fresh rock to test this hypothesis with a hammer bit will be conducted in the coming days as part of continuing RAB drilling at Woodline. Results for the Adiemanthus drilling will be reported when to hand. Drilling will continue at Leucippus, then Ommaney and Cleanthes, before moving to Leila (about 10 kilometres north of Cleanthes) and Phaedrus (between Ommaney and Theofrastos).

9 9 Figure 6 Woodline Project, Sipa Prospects and Gold-in-Calcrete Anomalies

10 10 Figure 7 Leucippus Maximum Gold-in-Hole Results Figure 8 - Leucippus - Bottom-of-Hole Gold Results

11 TENNANT CREEK GOLD PROJECT West Warrego Joint Venture (Sipa holds 70% of 295 sq. km with the Hosking- Allender- LeBrun Syndicate and may earn 80%) Meteoric Farm-in (Sipa may earn a 70% interest in 151 sq. km from Meteoric Resources NL) An approximately 2,000 line kilometre, 50 metre-spaced, low level airborne magnetic/radiometric geophysical survey was flown over the parts of the West Warrego Joint Venture and the Meteoric Farm-in in late 2011, as shown on Figure 9. Data and geophysical images are just to hand and interpretation has commenced, prior to planning the next phases at Tennant Creek. 11 Figure 9 Tennant Creek Gold-Copper Projects on LandSat Image

12 SIPA - ANTOFAGASTA STRATEGIC COPPER EXPLORATION ALLIANCE Sipa announced in our September Quarter ASX Report a Strategic Exploration Alliance in Western Australia. Generative work aimed at identifying districts and projects prospective for large copper deposits commenced in October and two Exploration Licences, named the Lake Wilderness Project, have been applied for by Sipa Copper Limited in Proterozoic sedimentary rocks east of Newman and will be considered by the Alliance. 12 OTHER PROJECTS No fieldwork was conducted at the Ilgarari, Yerrida and Panorama Basemetals Projects during the Quarter. Dated 30 January 2012 Signed on behalf of the Board of Sipa Resources Limited Michael Doepel MSc, DIC, MAusIMM The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr M G Doepel who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Doepel is a full-time employee of Sipa Resources Limited. Mr Doepel has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Doepel consents to the inclusion in this report of the matters based on his information in the form and context in which they appear. Hole No Angle Azimuth Easting Northing From (m) To (m) Interval Cu % THC including THC including AND THC including

13 THC AND AND THC Table 1 Enigma Prospect Significant Intersections (>0.1% Cu) 13 Hole Angle Azimuth Easting Northing From (m) To (m) Intersection g/tau WDR WDR WDR WDR WDR WDR WDR WDR WDR WDR Table 2 Leucippus Prospect Gold Results > 0.1g/t For more information: Mike Doepel, Managing Director Sipa Resources +61 (0) info@sipa.com.au About Sipa Resources

14 Listing on the Australian Stock Exchange in 1987, Sipa Resources Limited (ASX Code: SRI) is a Perth-based Australian gold, base metals and nickel exploration company with a proven track record having in the 1990s found the Panorama Copper-Zinc VMS Province and the Ashburton Gold Province, where Sipa produced profitable gold to mid 2004 from its discoveries Sipa s Greenfields exploration strategy provides the potential for enormous leverage for shareholders. The strategy saw Sipa the best performer on the Australian Stock Exchange in 1990 and this performance was nearly repeated in 2001 when Sipa coveted the second best performer based on the Waugh discovery at Paraburdoo. Greenfields exploration requires methodical, hard and systematic work to set up the possibility of discovery through drilling. This is what Sipa has done very successfully in the past, and what we continue to doing at all our projects. Sipa s present leading projects are in three of the Hottest Exploration Spots in Australia: The Thaduna Copper Project in WA s Gascoyne Region is only 25km east of the high grade DeGrussa- Conductor 1 Copper-Gold discovery and recent Sipa geological, geochemical and geophysical surveys and drilling are outlining some very exciting drilling targets. The Woodline Gold and Basemetals Project covers a large area within the emerging Tropicana Gold Province as well as underexplored greenstones of the Kalgoorlie Gold Province. Recently announced drill results from within both rock sequences warrant significantly more drilling this field season. The Tennant Creek Gold and Copper Projects are within the northwestern, and underexplored, extension of the Company-Making Tennant Creek Goldfield the Juno mine helped make the Peko Wallsend company and White Devil made Normandy. Sipa s early drilling has provided encouragement for Sipa to plan aggressive exploration for the coming field season. 14