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1 For personal use only Welcome Over the past few months, AMMG has made some significant achievements: AMMG s team inspects the intersected lignite & coal from historical exploration in the Green Range area Aluminous clay to alumina processing technology s first milestone achieved The Company secured the Green Range Coal Project in the Great Southern region of Western Australia near Albany. Based on exploration work by BHP and Rio Tinto (CRA) in the 1980s, AMMG has set an exploration target of Mt* of steaming or sub-bituminous coal. The development of AMMG s unique aluminous clay to alumina process technology is well underway, with the first out of four milestones achieved last month. AMMG is looking forward to announcing its advances on the technology once further milestones are met. AMMG conducted a site reconnaissance at its 100% owned mineral sands project at Gairdner, Western Australia. After completing RC drilling at the Southdown Extension Iron Ore Project, AMMG conducted a diamond drilling program in July, to extend the known width of the iron mineralisation. Results are pending. Site reconnaissance at Gairdner mineral sands project The Company increased its tenement holdings at the Constance Range Iron Ore project, acquiring an addition 120 square kilometres of ground around deposit P. AMMG participated in another successful annual Diggers & Dealers conference in Kalgoorlie. Thank you for your continued support. Southdown Extension iron ore diamond drilling program Ric Dawson Managing Director 1

2 Green Range coal project secured AMMG acquired a significant coal project in the Great Southern region of Western Australia near Albany. The Green Range Coal Project is strategically located just 40-70km from the town and port of Albany. Made up of one granted tenement and two exploration licence applications, the project is prospective for sub-bituminous or steaming coal. Historical exploration was conducted in the 1980 s by BHP and Rio Tinto (CRA). CRA s exploration work concluded with an exploration target* of up to 500 million tonnes of lignite. In 2001, Phanerozoic Energy carried out coal seam gas exploration in the Green Range area, and intersected coal seams up to approximately 5 metres. The presence of limestone and coal in the area indicates that the Green Range project area also has the potential for thick accumulations of glauconite. Phanerozoic did not continue its exploration, but acknowledged the existence of coal as a permanent feature in the area. Although the Green Range Coal Project carries a historical insitu reserve of lignite, AMMG must conduct new drilling and include the Phanerozoic drilling data in order to obtain a JORC statement of resources. However, the Company has determined an exploration target* of approximately million tonnes of sub-bituminous or steaming coal based on previous drill hole data and specific energy analysis. AMMG s submission to the state government Exploration Incentive Scheme (EIS) co-funded drilling program for the Green Range project was successful. The state government program will award up to 50% of the direct drilling costs. Drill program preparations are underway, with the drilling p r o g ram s c h e d u l e d t o commence in early Participation at Diggers & Dealers 2012 The 20th Diggers & Dealers conference was held at the Kalgoorlie Goldfields Art Centre on August over three days. The conference attracted over 2,300 delegates comprised of mining and exploration companies, private investors, fund managers and independent brokers from around Australia and overseas. The event was a significant marketing and networking opportunity for AMMG. A number of key networks were established at AMMG s booth, and follow-up communication is currently progressing. *The term Exploration Target should not be misunderstood nor misconstrued as an estimate of Mineral Resources and Reserves as defined by the JORC Code (2004), and therefore the term has not been used in this context. It is uncertain if further exploration or feasibility study will result in the determination of a Mineral Resource or Mining Reserve 2

3 Aluminous clay to alumina process technology moving forward The Company s unique aluminous clay to alumina processing technology moved forward when AMMG s chemical consultants achieved the first out of four milestones. The acid-based processing technology aims at producing high purity alumina (99.99%) and smelter grade (99%) alumina. The first milestone that was achieved involved the characterisation of the raw aluminous clay material. This involved determining the size fraction and other variables in order to produce an alumina end product from the Company s aluminous clay. The processing technology is based on and suited to the Company s unique aluminous clay material, which is significantly low in iron and other impurities, compared to bauxite, which is typically used to produce alumina. The aluminous clay used in the testing was extracted from AMMG s four 100% owned project areas: Meckering, Kellerberrin, Kerrigan and Bobalong. The project areas are in close proximity to either the Kwinana port or Albany port, and existing rail infrastructure. AMMG s processing technology uses an acid solution to separate the silica, with the iron and other metal impurities also being soluble, and therefore able to be separated. The Company s process is currently estimated to be at a lower cost curve than the traditional Bayer process. It potentially poses a significant cost advantage over existing competitors as a large amount of variables are eliminated due to the inherent benefits in the original mineralogy of the primary aluminous clay. Three milestones remain, and the C o m p a n y c o n t i n u e s t o collaborate with its chemical consultants, TSW Analytical, on the advancement of the unique technology. Further processing technology advances will be announced as they are achieved. 3 AMMG & TSW Analytical personnel

4 MAY 2012 Diamond drilling at Southdown Extension Diamond drilling commenced at AMMG s 100% owned Southdown Extension Iron Ore Project in July, to extend the known depth of the expected mineralisation. The Southdown Extension project is strategically located approximately 80km from the town and port of Albany. The stage 2 diamond drilling comprised of one drill hole for approximately 300m. Results of the program will be announced once the core has been cut and sent for DTR analysis and then interpreted by the geology team. After the successful completion of the stage 1 RC drill program, results indicated an average concentrate of 68% iron and an average mass recovery of 35%. The grind size was minus 75 microns (coarser than previously reported in Western Australia). The two settlements for the purchase of the 80% and 20% respectively occurred in August for tenement E70/2640. This resulted in AMMG issuing 6.25 million fully paid shares and 2.5 million 20 cent options. Further Southdown Extension project updates will be announced in the coming months. Mineral sands site reconnaissance AMMG conducted a site reconnaissance at its 100% owned mineral sands project, Gairdner in July. The tenement E70/3902 covers an area with known heavy mineral sand deposits in Eocene paleocoastline. The tenement is located about 35km north-west of Bremer Bay and about 484km south-east of Perth. The aim of the site reconnaissance was to inspect the terrain, infrastructure, the local farming land uses and conduct a geological overview of the area. Between the 1980 s and 1990 s, Eucla Mining NL conducted heavy mineral and gold analysis in the area. Eucla outlined a resource calculation for three main heavy mineral deposits. The largest deposit, the Jones deposit, has an exploration target* of approximately million tonnes at 2.4% heavy mineral sands. Based on historical work conducted by Eucla Mining, there is an exploration target* of approximately million tonnes at 2.5% heavy mineral within tenement E70/3902. AMMG is currently planning a drill program to obtain a JORC statement of resources. 4

5 AUGUST2012 In the media Sourced from on August 17,

6 AUSTRALIA MINERALS & MINING GROUP LTD (AMMG) was incorporated on 8th May 2007, for the purpose of securing tenements over land that had been subject to historical exploration and where significant geological data was available and/or the land was considered sufficiently prospective due to proximity to existing resources and infrastructure. The Company has identified nine separate project areas, located in Western Australia and Queensland, which the Directors believe has the potential for the realisation of economic resources of these commodities - iron ore, aluminous clay/aluminous clay, coal, gypsum, mineral sands, salt and gold. The Company has 20 granted tenements and 42 applications for tenements covering in excess of 12,383km² over the nine project areas. AMMG board members (L-R): Jamie Coote; Ric Dawson; Dan Tenardi; Luke Atkins; Peter Bailey Shareholder Services Share Registry Any shareholders wishing to perform any of the following tasks should visit our share registry on Seek information about their shareholdings or related administrative matters, including account details, balances, payments; Download the forms necessary to initiate changes to the details held on the company's shareholder records: AMMG s Share Registry contact details are: Security Transfer Registrars Pty Ltd 770 Canning Highway Applecross WA 6953 T: (08) F: (08) E: registrar@securitytransfer.com.au Change of Address Any shareholders who have changed their address are asked to provide written advice of the change, quoting the relevant shareholder number to AMMG s share registry - Security Transfer Registrars Pty Ltd. Subscribe to AMMG Alerts If you wish to subscribe to receive by AMMG s announcements made to the ASX as well as to receive notifications of the release of the Company's Annual and Half Year Reports, please subscribe to alerts via the Company s website. Electronic communication of company information helps to reduce expenditure on printing and mailing as well as contribute positively to the environment. 3 Bay Rd, Claremont Western Australia 6010 Phone: Fax: info@ammg.com.au Web: ASX CODE: AKA OPTIONS CODE: AKAOA As at 28/08/2012 Ordinary shares Performance shares Listed options 41.9m Unlisted options 11.5m Market cap 9.1m Cash 4.95m Share price 0.09 Debt 8m Nil COMPETENT PERSONS STATEMENT Information in this newsletter is based on information compiled by Mike O Mara, who is a Member of the AIG and is an employee of AMMG. He has sufficient relevant experience to qualify as a competent person as defined in the 2004 edition of the Australasian Code for Reporting of Mineral Resources and Ore Reserves (JORC code). Mike O Mara consents to the inclusion in 6