Quarterly Report For the period ending 30 September 2013

ASX release

Tuesday, 29 October 2013

ASX code

CBX

Issued capital (as at 30/9/2013) Shares issued 181, 406,099

3,310,973 Director and Management Unlisted

Performance Options and Rights

1,979 shareholders

Top 20 shareholders hold 89 per cent Largest shareholders (as at 30/9/2013) RCF (Funds III LP & IV LP) 29.7 per cent Metallica Minerals Limited 16.5 per cent China Xinfa Group 16.2 per cent Bondline Limited 11.8 per cent Directors

George Lloyd - Chairman

Graeme Sherlock - Managing Director Rennie Fritschy - Non-Executive Director Jijun Liu - Non-Executive Director

Peter Nicholson - Non- Executive Director

Company Secretary

Scott Waddell

Cash balance

As at 30 September 2013, Cape Alumina's

consolidated cash balance was approximately

$ 1.7million.

Australia's leading pure-play bauxite company

Key points

Cape Alumina to merge with MetroCoal to create a diversified bauxite and thermal coal business with a staged development pipeline

Long-term outlook for bauxite market remains positive

Draft Cape York Regional Plan to be released by the Queensland Government for public comment by the end of the year

Cape Alumina to merge with MetroCoal

During the last quarter, MetroCoal Limited (ASX: MTE) and Cape Alumina Limited (ASX: CBX) signed a Merger Implementation Agreement (MIA) which proposes to combine the companies to create a diversified bauxite and thermal coal business with a staged development pipeline.
In a joint announcement to the ASX, MetroCoal Chairman Stephen Everett said the merger would deliver significant benefits for both companies, including increased near-term development opportunities, a strengthened balance sheet, increased trading liquidity and enhanced access to capital markets.
"The proposed merger will create a Queensland-based, diversified bulk commodities company with a portfolio of major bauxite and thermal coal projects which will provide resilience through commodity cycles," Mr Everett said.
"The immediate priority of the merged company will be to develop Cape Alumina's bauxite assets on western Cape York, in particular the flagship Pisolite Hills mine and port project near Mapoon, to capitalise on the strong and growing global market
for bauxite and to generate a positive cash flow for the company.
"The merger provides an immediate cash injection from MetroCoal to Cape Alumina, through a $3 million convertible note, which will allow Cape Alumina to progress the technical and environmental studies required for the Pisolite Hills project to gain the necessary government approvals.

Continued on page 3

Quarterly Report for the period ending 30 September 2013

Cape Alumina to merge with MetroCoal (from page 2)

"The new entity will continue to advance the Bundi and Columboola coal projects in the Surat Basin in line with the longer-term development opportunity for these assets," he said.
Significant benefits to shareholders of the merged entity include: