Quarterly Report 30 January 2013

About Artemis Resources Quarterly Activities Report December 2012 Artemis Resources is an ASX-listed mineral exploration company with a focus on gold and base metals:

Highlights Key Gold Projects

Mt Clement – gold/antimony (WA)  Review of Mt Clement Project identifies significant Yandal – gold (WA) antimony mineralisation at Eastern Hills West – gold/base metals (WA)  Artemis plans 2013 drilling to upgrade Eastern Hills to a JORC compliant resource

 Encouraging gold results from Nickol River auger Artemis’ corporate strategy is to maximise sampling shareholder returns through a combination of exploration success and quality project  West Pilbara review and strategy to be released in acquisition. Q1 2013

The Company's focus on gold is viewed  Yandal review and planning for 2013 exploration as an important growth strategy for the nearing completion Company.

Australian Securities Exchange MT CLEMENT PROJECT (WA) Code: ARV As part of a review of the Artemis project portfolio at the end of Artemis Contact 2012, the Company identified historical antimony-lead Guy Robertson mineralisation at the Eastern Hills location, less than one kilometre Executive Director to the southeast of the Mt Clement gold deposit, in the Ashburton Tel: +61 2 9078 7670 region of Western (Figure 1).

Tony Dawe The Mt Clement Project includes the Mt Clement Gold Project (ARV Investor Relations 80%) a gold joint venture with Northern Star Resources Ltd (ASX: NST Tel: +61 8 9388 0944 20%) in relation to tenements M08/191, M08/192 & M08/193. NST Mob: 0405 989 743 is the operator of the nearby Paulsens Gold Mine, where production is forecast to rise to 100-115,000oz gold in calendar year 2013 on the www.artemisresources.com.au back of recent exploration success and production improvements (See NST ASX Announcement 14 January 2013). The Mt Clement gold deposit contains an Inferred Resource of 1.13Mt at 1.8g/t Au and 17.0g/t Ag (64,000oz gold and 618,000oz silver contained) that is compliant with the JORC Code (2004)1. No exploration work was carried out in relation to the Mt Clement For personal use only use personal For Gold Project during the quarter.

1 Mt Clement Inferred Resource previously reported in ASX Announcement dated 26 July 2011

Artemis Resources Limited ABN: 80 107 051 749 Telephone: +61 2 9078 7670 | Facsimile: +61 2 9078 7661 | Email: [email protected] Level 9, 50 Margaret Street, SYDNEY NSW 2000 | PO Box R933 Royal Exchange, NSW 1225 Australia www.artemisresources.com.au

Eastern Hills antimony-lead deposit

In the mid 1990s, Taipan Resources NL defined a zone of antimony-lead (Sb-Pb) mineralisation based on 19 reverse circulation (RC) holes, as outlined in an internal report2. A review of historical exploration at Eastern Hills suggests that there is potential for an initial exploration target in the range 410,000 - 1,250,000t at 1.5-1.9% Sb and 2.1-2.7% Pb. The exploration target also contains precious metal credits of around 0.22g/t gold and 26g/t silver.

It should be noted that as this is an exploration target, the potential quantity and grade is conceptual in nature, there has so far been insufficient exploration to define a Mineral Resource in compliance with the JORC Code and it is uncertain if further exploration will result in the determination of a Mineral Resource as defined by the JORC Code.

Figure 1 Mt Clement Project – Eastern Hills location map

The Eastern Hills Sb-Pb deposit consists of a zone of mineralisation up to two metres wide associated with a fault structure and outcropping over a strike length of at least 600 metres. The dominant quartz vein host trends ENE and dips steeply (80°) to the SSE. The Sb-Pb mineralisation occurs as massive sulphides bounded by a broader zone of disseminated sulphides. In addition to high levels of Sb and Pb, the mineralisation also contains minor gold and silver.

Sulphide mineralogy consists of arsenopyrite, pyrite and boulangerite – a lead-antimony sulphide – with minor pyrrhotite, chalcopyrite and galena. Both arsenopyrite and pyrite extend into the disseminated zone for up to eight metres, forming a mineralised zone up to ~15 metres wide. A preliminary metallurgical assessment was designed by

Normet and commissioned to Ammtec by Taipan. The following summary is provided in Taipan’s 1997 internal report2. For personal use only use personal For A 20kg “ore grade” sample composite was subjected to gravity separation and flotation recovery with the objective of producing a high grade antimony-lead concentrate. Mineralogical examination of drill chips identified boulangerite

(Pb5Sb4S11) as the main sulphide along with arsenopyrite, pyrite and pyrrhotite. Rougher flotation using potassium amyl xanthate (PAX) and two recognised activators yielded high Sb and Pb recoveries – greater than 98%.

2 Eastern Hills Project Resource Report, Taipan Resources NL internal report, November 1997

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Parameters Minimum Maximum

Strike length (m) 575 775 True width (m) 1.7 2.3 Vertical depth (m) 120 200 SG 3.5 3.5 Tonnes (t) 410,000 1,250,000 Sb Grade (%) 1.5 1.9 Pb grade (%) 2.1 2.7 Au grade (g/t) 0.22 0.22 Ag grade (g/t) 26 26

Figure 2 Eastern Hills drill hole plan and geology Table 1 Exploration target parameters

Eastern Hills exploration target

Historically 19 reverse circulation (RC) drill holes were completed by Taipan Resources NL in 1996 and 1997 for a total of 1,975 metres. The drilling successfully demonstrated continuity of the Sb-Pb mineralisation along a strike length of at least 600 metres (Figure 2) and to a vertical depth of 120 metres however the mineralisation remained open, both at depth and along strike. There has been no follow-up exploration of this deposit.

Artemis’ exploration target has been estimated using a range of factors including the strike and dip of the known mineralised structures, historical exploration results and the nature of narrow vein metallic deposits.

Historical grade modelling of the mineralised zone was undertaken by Taipan2 utilising the following parameters:

Mineralised zones – zones of mineralisation were delineated on cross sections based on a cutoff grade of 3.0% Pb equivalent (PbEq) where PbEq was calculated using the equation Pb + (3.1 x Sb). A review of historical commodity prices indicates that average lead and antimony prices for the month of November 1997 were 26c/lb (Pb) and 83c/lb (Sb), respectively, a ratio of 1 to 3.2.

Top cut - no upper cutoff grade was used

Minimum width – the minimum downhole width used was 1 metre

Dilution – internal dilution was included, however there is no indication of the maximum internal dilution width allowed in the estimation.

Average grades – grades for antimony, lead, gold and silver were modelled within the sectional mineralised zone For personal use only use personal For using weighted average grades relative to drill hole intercept width and the polygonal method.

Table 1 shows assumptions utilised in estimating the Eastern Hills exploration target, which resulted in a target range of 410,000 - 1,250,000 tonnes at 1.5-1.9% Sb and 2.1-2.7% Pb. The exploration target also contains precious metal credits of around 0.22g/t gold and 26g/t silver.

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The Eastern Hills exploration target incorporates potential quantity and grade, and is therefore conceptual in nature. There has been insufficient exploration to define a Mineral Resource in compliance with the JORC Code and it is uncertain if further exploration will result in the determination of a Mineral Resource as defined by the JORC Code.

Eastern Hills proposed program

The Eastern Hills deposit now has significant relevance to Artemis, based on the antimony price surge, and it is planning to commence exploration in 2013, with the objective to confirm the exploration target and upgrade it to a resource estimate that is compliant with the JORC Code, as well as expanding the resource both down dip and along strike.

The exploration program envisaged will include a thorough review of all Eastern Hills historical data, field reconnaissance and verification of geological interpretation, re-analysis of surface outcrops for confirmation of mineralisation, planning and undertaking a campaign of RC drilling to both confirm previous drilling and extend the mineralisation at depth and along strike. Artemis intends to engage a Competent Person to take responsibility for the process leading to estimation and reporting of mineral resources in accordance with the JORC Code during 2013.

Antimony prices and market

Antimony is a specialty metal, commonly found in nature in its sulphide form of stibnite. Saleable products include antimony metal (ingot) and antimony trioxide - a white powder. It is used as a fire retardant, a hardening/strengthening agent for lead and zinc alloys, lead batteries, ammunition, a catalyst in PET (plastics) production and in ceramics.

Global commodity prices, specifically antimony prices, have surged to record highs, with antimony pricing currently 50% higher than that of copper (Figure 3). Since the record monthly average price for antimony ingot reached US$16,800 per tonne in March 2011, antimony prices have remained strong, currently trading at around US$12,000 per tonne, a six-fold increase since the Eastern Hills deposit was first reported in 1997. This has the potential to significantly enhance the economic parameters of the Eastern Hills deposit.

Global antimony output has been dominated by China for many years (Figure 4). This potentially risky reliance on China as a source of global antimony has led to the European Commission placing antimony on its list of 14 Critical Raw Materials, based on supply risk, economic importance and environmental country risk.

For personal use only use personal For

Figure 3 Antimony price vs copper price Figure 4 Annual global antimony production by country

For more comprehensive details regarding the Eastern Hills antimony deposit, please refer to Artemis Resources’ ASX Announcement dated 16 January 2013.

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WEST PILBARA PROJECT (WA)

Artemis engaged Snowdens, an independent industry consultant, to undertake a thorough review of the West Pilbara project portfolio. The Company is now internally finalising its priorities and strategy to advance this project area during 2013. An announcement is expected during the March quarter. The West Pilbara Project covers a large area and is prospective for a broad range of commodities including gold, nickel, copper, PGEs and iron ore.

Auger Sampling Program

As advised in the September 2012 Quarterly Report, Artemis undertook an auger sampling program on selected areas of its West Pilbara Project in the second half of 2012. The focus of the program was on the Nickol River and Golden Reef areas (Figure 5), both of which are known for their historical alluvial gold associations.

For personal use only use personal For Figure 5 West Pilbara Project – Location of Nickol River and Golden Reef prospects

The auger was utilised on 50m x 25m grids at Nickol River, and a 25m x 25m grid at Golden Reef, to penetrate 20-60cm below the surficial alluvial cover and test the underlying gold distribution on a regular grid pattern. The resultant chip samples were sieved on site to minus 2mm and delivered to the Genalysis Laboratory in Perth for analysis of Au, Ag, As, Co, Cr, Cu, Fe. Ni, Pb and Zn.

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Nickol River

Auger sampling at the Nickol River prospect focused on three tenements (Tozers, Nickol South and Lydia) in the central portion of the Nickol River goldfield (Figure 6), about 15km east of Karratha. Considerable small scale, alluvial mining operations have been carried out in this area since 1984. The area is highly prospective due to the numerous, favourable structures and extensive known mineralisation, occurring both disseminated in the country rock and also in quartz reefs. These reefs are likely to be the source for much of the alluvial gold found in this goldfield.

Figure 6 Nickol River tenements covered by auger sampling program

The Tozers tenement P47/1518 is known to host at least three WSW-ENE trending quartz lodes (Figure 6). Previous explorers in the 1980s reported best RC drill intervals3 of 4m at 9.76g/t Au from the Samantha Zone, 2m at 15.00g/t Au from the Tozers zone and 3m at 34.50g/t Au from the Boiler Zone.

The gold results achieved in the 2012 auger drilling program were very encouraging. The Tozers auger grid returned the best results from the campaign, with values as high as 6.87g/t and 2.64g/t Au. A significant 300m x 400m zone of anomalous gold mineralisation was defined, as demonstrated in the attached geochemical contour map (Figure 7). The

Tozers auger gold anomaly remains open, particularly to the east. For personal use only use personal For

Once the current wet season has passed, field reconnaissance will assess the anomalies generated in relation to the reported old workings and drill hole locations (if they remain intact). A drilling program will then be considered to test the auger anomalies, validate previous RC drill results and to test continuity and extensions to the gold mineralisation.

3 Artemis has not yet been able to verify the quality control data, original laboratory files and location of drill holes on the ground for the historical drilling.

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Figure 7 Tozers Prospect – Auger sampling gold geochemistry values and contours

It should also be noted that due to the “nuggety” nature of gold in the Nickol River area, as demonstrated by alluvial workings, repeat samples undertaken internally by the Genalysis Laboratory on anomalous samples showed a wide variance. For example, sample NRA249 originally returned 6,872ppb Au (or 6.872g/t Au) using the AR10/GF analysis method, whilst two repeats from the same pulp returned 1.04g/t and 0.46g/t gold using the AR10/SAA analysis method. Conversely, sample number NRA250 originally returned 425ppb Au (or 0.43g/t Au) using the AR10/GF analysis method, whilst two repeats from the same pulp returned 34.09g/t and 0.24g/t gold using the AR10/SAA analysis method.

At Nickol River South (P47/1519), a single quartz lode - the Nickol South Lode - has been defined (Figure 6), also trending WSW-ENE. Limited historical RC drilling returned a best result of 1m at 1.47g/t Au on this prospect. Gold results from the auger sampling campaign on this prospect were all below 70ppb Au.

At Lydia (P47/1920), another quartz lode has been identified, trending SW-NE (Figure 6). Historical drilling resulted in a best intersection of 6m at 2.93g/t Au. Only the southwestern portion of the Lydia tenement was tested by the latest auger sampling program, returning a peak gold result of 243ppb, well above local background levels of around 10ppb Au (Figure 8). The gold anomaly remains open to the northeast. The anomalous zones warrant further field reconnaissance to determine whether follow up drill testing of this target is appropriate.

Golden Reef

For personal use only use personal For The Golden Reef target is located centrally within Artemis Resources’ West Pilbara Project area (Figure 5), situated approximately 25km south of Karratha. The M47/177 and adjacent M47/288 tenements cover substantial alluvial and eluvial gold workings known as the Sholl East and Golden Reef prospects.

The Sholl East/Golden Reef zone has a demonstrated potential to host substantial amounts of gold, however to date only near surface targets have been tested. Regional structural targets remain untested despite the fact that substantial amounts of coarse surface gold have been found in the area.

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The latest phase of auger sampling covered a small area of these two tenements. The results however, were disappointing with only one individual sample out of 150 samples returning above 40ppb Au (53ppb). Further field reconnaissance will be required to interpret the relationship of these results with respect to the known mineralisation.

Figure 8 Lydia Prospect - Auger sampling gold geochemistry values and contours

No significant results were obtained from other elements tested in the current auger sampling campaign at Nickol River and Golden Reef.

Genalysis assay methods – West Pilbara auger sampling Au: AR10/GF: 10 gram Aqua-Regia digest, unfiltered. Analysed by Graphite Furnace Atomic Absorption Spectrometry. Au repeats: AR10/SAA: 10 gram Aqua-Regia digest, unfiltered. Solvent Extraction, then Flame Atomic Absorption Spectrometry. Ag, As, Co: 4A/MS: Multi-acid digest including Hydrofluoric, Nitric, Perchloric and Hydrochloric acids in Teflon Tubes. Analysed by Inductively Coupled Plasma Mass Spectrometry. Cr, Cu, Fe, Ni, Pb, Zn: 4A/OE: Multi-acid digest including Hydrofluoric, Nitric, Perchloric and Hydrochloric acids in Teflon Tubes. Analysed by Inductively Coupled Plasma Optical (Atomic) Emission Spectrometry. Internal standards, blanks and duplicate checks were carried out by Genalysis. No standards, blanks or duplicate checks were inserted into the sample package by Artemis. No third party laboratory checks have been undertaken to date.

For personal use only use personal For

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YANDAL GOLD PROJECT (WA)

While no ground work was undertaken during the quarter, a strategy for exploration activities to follow up on past drilling success and geophysical targeting at the Lowlands prospect, and the broader Yandal Gold Project, is currently being finalised and will be announced during the March quarter.

CORPORATE

The Company has cash on hand as at 31 December 2012 of $1.35 million and a further $450,000 in tradeable investments.

ABOUT ARTEMIS RESOURCES

Artemis Resources Limited is a resources exploration company with a focus on its prospective Mount Clement, Yandal and West Pilbara gold projects in . These projects have significant exploration potential and close proximity to existing important deposits or producing mines. Artemis aims to develop a significant gold inventory through exploration and acquisitions which have the potential to become mines and create shareholder value.

For further information, please contact:

Tony Dawe Artemis Resources Ltd Professional Public Relations Office: +61 2 9078 7670 + 61 8 9388 0944 Email: [email protected] Email: [email protected] Web Site: www.artemisresources.com.au

Competent Person Statements

The information in this document that relates to Exploration Results and Exploration Targets is based on information compiled or reviewed by Mr Trevor Woolfe, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Woolfe is a consultant to the Company, and is employed by Alexander Cable Pty Ltd. Mr Woolfe has sufficient experience which is relevant to the styles of mineralisation and types of deposits 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 Woolfe consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this document that relates to Mineral Resources at the Mount Clement Gold Project is based on information compiled by Mr Steven Nicholls, who is a Member of Australian Institute of Geoscientists. Mr Nicholls 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 Nicholls of Apex Geoscience Limited consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

For personal use only use personal For The Company’s Exploration Target includes potential quantity and grade and is conceptual in nature. There has been insufficient exploration to define these mineral resources and it is uncertain if further exploration will result in the determination of mineral resources.

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Board of Directors and Management Registered Office

Guy Robertson Artemis Resources Limited Executive Director 50 Margaret Street Sydney, NSW, 2000 George Frangeskides AUSTRALIA Non Executive Director Phone: (+61) (2) 9078 7670 Shannon Coates Facsimile: (+61) (2) 9078 7661 Non Executive Director www.artemisresources.com.au

Share Registry Security Transfer Registrars Pty Ltd 770 Canning Highway Applecross, WA, 6153 AUSTRALIA

Phone: (+61) (8) 9315 2333 Facsimile: (+61) (8) 9315 2233 www.securitytransfer.com.au Please direct all shareholding enquiries to the share registry

For personal use only use personal For

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