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1 REPORT FOR THE QUARTER ENDED 30 SEPTEMBER 2011 ASX Code: XCD Ord Shares on Issue: 90,500,436 Key Points: Chairman: Patrick O Connor Managing Director: Ian Culbert Finance Director: Stephen Belben Registered Office 2,187m diamond drilling programme on Moabsvelden undertaken during quarter together with extensive washability testwork programme. Moabsvelden resource increased to 66.3mt in-situ and upgraded from Indicated to Measured. In addition to a 20% increase in the total tonnage, selective geological modeling on a ply by ply basis has resulted in qualitative increases to the total resource. Mining right application for Moabsvelden well advanced and will be submitted shortly. Application for regulatory approval to acquire two new coal projects, Roodepoort and Bankfontein, submitted. Appoint of key South African personnel made and new office established in Middelburg, Mpumalanga. Level 9, 105 St Georges Terrace Perth WA 6000 Postal: GPO Box 2575 Perth WA 6001 T: +61 (8) F +61 (8) South Africa 4/B Midland Office Park Middelburg, Mpumalanga 1050 T: +27 (13) F: +27 (13) ABN: Moabsvelden (XCD 74%) The drilling programme completed during the quarter resulted in an increased and upgraded JORC compliant resource of 66.3 million tonnes (Measured 63,745,154 tonnes, Indicated 2,393,471 tonnes) for the Company s 74% owned Moabsvelden project. The completion during the quarter of a 29 hole diamond drilling programme for a total of 2,187m reduced the average drill spacing on the project from approximately 550m to 250m and elevated the geological confidence from Indicated to Measured, the highest level of geological confidence. In addition to upgrading geological confidence in the Moabsvelden resource, the recent drilling programme increased the total resource by almost 11 million tonnes. The additional tonnages have been developed in the southern portion of the project area, where previous drilling had not defined the extension of the large 2. The mean strip ratio (cubic metres of waste to each tonne of coal) for the project is 1.95:1 with much of the early anticipated production expected to be mined at strip ratios well below this already low figure (refer Figure 1 below). Xceed Resources Limited is an Australian based public company engaged in the acquisition of mineral projects in Southern Africa. The company s primary focus is the development of coal projects located within South Africa s premier coal fields, which are supported by established infrastructure and are readily capable of reaching their markets. The company s first project is the Moabsvelden thermal coal project situated in the Witbank coal field. Subject to regulatory approval, Moabsvelden is expected to have a mine life in excess of 10 years with the potential to produce export quality as well as domestic quality thermal coal from an open-cast, low strip mine.

2 As indicated in Figure 1 below, the coal resource extends throughout the project area save for the south west corner where a paleo high has replaced the coal. It is expected that the coal wash plant will be located in this area where there is no coal. For personal use only Figure 1 Strip Ratio contour map The updated resource is based on a total of 39 NQ diamond holes for a total of 2,868 metres. The average drill spacing and average depth is 250m and 73.5m respectively. On behalf of its 74% owned subsidiary, Neosho Trading 86 (Pty) Ltd, the Company appointed Gemecs (Pty) Ltd, an independent consultancy, to undertake all logging and sample preparation. Core samples were analysed at Noko Laboratory Services in South Africa, according to ISO standards. Gemecs were also tasked with geological modelling and reporting. Gemecs imported all data to GBIS (a commonly used geological database) against which the data was validated. The verified data set was used by Gemecs to construct a geological model from base principles using Gemcom Minex TM geological modelling software. Gemecs applied a seam thickness cut-off of < 0.5m excluded and have reported the following Gross in situ coal resource for the Moabsvelden Project in accordance with the JORC Code.

3 Moabsvelden GTIS resources tonnage, September 2011 Raw Qualities (Air Dry) (m 2 ) Thickness Tonnes RD AS IM CV () VM TS DAFV Waste (m 2 ) MBV pt8 Measured SM S4U&S4L ,076, ,937,552 MBV pt8 Measured SBA S2A , ,147,224 MBV pt8 Measured SBB S2A ,775, ,377 MBV pt8 Measured SBC S2A ,431, ,049 MBV pt8 Measured SBD S2U ,043, ,060 MBV pt8 Measured SBE S2L ,017, ,769 MBV pt8 Measured SBF S2L ,588, ,181 TOTAL Measured ,745, ,644,212 Raw Qualities (Air Dry) (m 2 ) Thickness Tonnes RD AS IM CV () VM TS DAFV Waste (m 2 ) MBV pt8 Indicated SBA S2A , ,023,028 MBV pt8 Indicated SBC S2U , MBV pt8 Indicated SBD S2U , ,956 MBV pt8 Indicated SBE S2L , ,840 MBV pt8 Indicated SBF S2L , ,816 TOTAL Indicated ,393, ,048,647 Measured & TOTAL Indicated 66,138,625 Moabsvelden Washability Results Full washability curves for product qualities ranging from a 25.5MJ primary product to a 26.6MJ primary product have been developed. The table below (split between the Measured resource and the Indicated resource), illustrates the product qualities and theoretical yields assuming a 26MJ primary product and a 20MJ secondary product. The results of the washability testwork indicate that the combined average theoretical coal product yield to produce a 26.0 primary product and a 20 secondary product is 63% with a substantial component being an export quality product. It is stressed that practical yields and actual product qualities will be different, and that optimization studies are necessary as part of the feasibility study to determine the best product mix to be produced having regard to the availability of markets and the ability of the Company to deliver to those markets.

4 26 CV Prime Product Primary product for a 26.0 CV Middling for 20 CV (m2) Thick ness Tonnes PWD PYL PAS PIM PCV PVM PTS SWD SYL SAS SIM SCV SVM STS Total Yield MBV pt8 Measured SM MBV pt8 Measured SBA MBV pt8 Measured SBB MBV pt8 Measured SBC MBV pt8 Measured SBD MBV pt8 Measured SBE MBV pt8 Measured SBF Total Measured ,745, Primary product for a 26.0 CV Middling for 20 CV (m2) Thick ness Tonnes PWD PYL PAS PIM PCV PVM PTS SWD SYL SAS SIM SCV SVM STS Total Yield MBV pt8 Indicated SBB S2A MBV pt8 Indicated SBC S2A MBV pt9 Indicated SBD S2U MBV pt10 Indicated SBE S2L MBV pt11 Indicated SBF S2L Total Indicated ,393, Mining Right Application During the quarter work continued on the Mining Works Programme and Social and Labour Plan for the Moabsvelden project in preparation for the submitting an application for a mining right by the Company s 74% subsidiary Neosho Trading. The application for a Mining Right will be submitted to the Department of Mineral Resources shortly. New Properties In June, the Company s wholly owned subsidiary, Focus Investments Pty Ltd (FCI), entered into a binding heads of agreement with a local South African company, Hampfuna Mining & Exploration Pty Limited (HMPL), the holder of two coal prospecting rights; Roodepoort 40, in the Witbank coal field and Bankfontein 215 in the Ermelo coal field. The heads of agreement provides for FCI to acquire up to 70% in two new companies to be established to hold each of the prospecting rights. During the September quarter application was made in terms of Section 11 of the Mineral and Petroleum Resources Development Act (2002) for Ministerial consent to the acquisition by Xceed of a 70% interest in each of the Roodepoort and Bankfontein thermal coal projects. At the same time, the drafting of definitive agreements covering the transactions was completed during the quarter and they are expected to be executed by the parties shortly.

5 Appointments and New Office Establishment During the quarter the Company made two senior appointments to our staff in South Africa. Mr Boetie Jewaskiewitz has been appointed General Manager South Africa and heads up our South African operations. Mr Gerhard Visagé has been appointed Business Development Manager and is responsible for liaison with Government, business partners and all interested and affected parties. Both appointees are qualified mining engineers and are highly experienced in the development and operation of coal mines in South Africa and elsewhere. The Company has also established a new office in Middelburg, Mpumalanga as part of the process of gearing up for the development of Moabsvelden Colliery as well as other projects. Cash on hand As of 30 September 2011, total cash on hand amounted to $10.04 million. Plans for December Quarter During the December quarter it is planned to: Complete the Mining Work Programme (preliminary mine planning, site layout, preliminary marketing studies and financial modeling) for Moabsvelden Complete the Social and Labour Plan (detailing human resource planning and local economic development participation) for the Moabsvelden Project Lodge a Mining Right Application for Moabsvelden with the Department of Mineral Resources Continue with the Environmental Impact Study at Moabsvelden Commence a feasibility study for Moabsvelden Execute definitive legal agreements for the acquisition of the Roodepoort and Bankfontein properties. For further information regarding the Company, please contact the Company on or refer to For and on behalf of the Board of Xceed Resources Limited Ian Culbert Managing Director 26 October 2011 Competent Persons Statement: Information in this announcement that relates to exploration results, mineral resources or ore reserves in respect of the Moabsvelden Thermal project is based on information compiled by Mr Kobus Dippenaar, Pr.Sci.Nat, B.Sc Hons (Geology), GSSA, who is a senior coal geologist at Gemecs (Pty) Ltd who have consulted to the Company. Gemecs is a recognised Overseas Professional Organisation. Mr Dippenaar 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, Mineral Resources and Ore Reserves. Mr Dippenaar consents to the inclusion in the presentation of the matters based on his information in the form and context in which it appears.