Half Yearly Report and Accounts

11 March 2013

INTERIM FINANCIAL REPORT

Base Resources Limited (ASX:BSE; AIM:BSE) ("Base" or the "Company") is pleasedto provide its Interim Financial Report for the six month period ended 31December 2012.

Please find below an extract from the Interim Financial Report (reported inAustralian dollars) including:

* The Directors Report;

* Consolidated Statement of Comprehensive Income;

* Consolidated Statement of Financial Position;

* Consolidated Statement of Changes in Equity; and

* Consolidated Statement of Cash Flows

A copy of the full Interim Financial Report, including the accompanying notesto the accounts, is available from the Company's website atwww.baseresources.com.au. BASE RESOURCES LIMITED CONSOLIDATED ACCOUNTS ABN 88 125 546 910 Interim Financial Report for the six month period ended 31 December 2012 DIRECTORS REPORT

Your directors submit the interim financial report of the Group, being theCompany, Base Resources Limited, and its controlled entities for the half-yearended 31 December 2012.

Directors

The names of the directors in office at any time during or since the end of thehalf-year are:Mr Andrew KingMr Tim CarstensMr Colin BwyeMr Winton WilleseeMr Samuel WillisMr Trevor SchultzMr Michael AndersonMr Mike Stirzaker - alternate for Trevor Schulz

Directors have been in office since the start of the financial year to the dateof this report.

Company Secretary

Mr Winton Willesee held the position of company secretary during the half year.

Principal Activities and Significant Changes in Nature of Activities

The principal activities of the Group during the half-year were the developmentof the Kwale Mineral Sands Project in Kenya.

There were no significant changes in the nature of the Group's principalactivities during the half-year.

Operating Results

Total comprehensive loss of the Group for the half-year amounted to $3,374,028(2011: profit $283,887).

Dividends Paid or Recommended

There were no dividends paid or declared for payment during the period ended 31December 2012.

Review of Operations

Base continues to make strong progress in the development of the Kwale MineralSands Project with the level of site construction activity increasingsignificantly in the last quarter of 2012. With the overall development 50%complete, the Kwale Project continues to be on schedule for practicalcompletion in Q3 2013 and first shipment in Q4 2013.

In early October, the Company completed a A$40 million share placement andentitlement offer in order to meet the additional funding requirements from therevised Kwale Project capital cost estimate of US$298 million.

The Company achieved financial close on the US$170 million project debtfacilities in November and the first drawdown of US$52 million was completed.This was a critical milestone in the development of the Kwale Project as Basenow has access to the full funding required to complete the development of theKwale Project and bring it to positive cash flow.

Despite the recent soft demand, the long term outlook for all mineral sandsproducts remains very positive. In this light, Base continues to receive stronginterest in all of its products from the market. Discussions continue with anumber of parties in relation to the balance of Base's production not alreadysecured by offtake agreements.

Financial Position

The Group's working capital, being current assets less current liabilities, was$86,508,469 at 31 December 2012 (30 June 2012: $101,172,415).

Achieving financial close on the US$170 million project debt facilities inNovember 2012 ensures Base Resources has the funding required to take Kwalethrough development and to positive cash flow. At 31 December 2012 theavailable loan balance was US$118 million.

In the Directors' opinion, there are reasonable grounds to believe that theGroup will be able to pay its debts as and when they become due and payable.

Auditor's Declaration

The lead auditor's independence declaration under section 307C of theCorporations Act 2001 is set out on page 6 of the full report for the half-yearended 31 December 2012.

This report is signed in accordance with a resolution of the Board ofDirectors.

Winton WilleseeDirectorDated this 11th day of March 2013

CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOMEFOR THE SIX MONTHS ENDED 31 DECEMBER 2012

6 months to 6 months to 31 December 2012 31 December 2011 Note $ $ Restated Directors' and related fees (1,081,949) (792,026)Employee benefits expense (419,299) (190,492)Consultant fees (786,867) (395,117)Administrative expense (761,635) (512,184)Accounting, audit and related (137,952) (224,051) services feesShare based payment expense (215,069) (89,207)Depreciation (35,961) (12,597)Other expenses from ordinary (42,829) (45,302) activities

Profit / (loss) before financing (3,481,561) (2,260,976)

income and income taxFinancing income, net 2 1,087,624 2,682,827Profit / (loss) before income tax (2,393,937) 421,851Income tax expense - (8,686)Net profit / (loss) for the period (2,393,937) 413,165Other comprehensive incomeForeign currency translation (980,091) (129,278) differences - foreign operations

Total other comprehensive income / (980,091) (129,278)

(loss) for the periodTotal comprehensive income / (loss) (3,374,028) 283,887 for the period Profit / (loss) per share Cents CentsBasic profit / (loss) per share (0.47) 0.12 (cents per share)Diluted profit / (loss) per share (0.47) 0.11 (cents per share) Weighted average shares on issue Number NumberBasic earnings per share 505,005,246 356,740,710Diluted earnings per share 514,505,246 366,240,710

The accompanying notes form part of these consolidated financial statements.

CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITIONAS AT 31 DECEMBER 2012 31 December 2012 30 June 2012 Note $ $ Current assetsCash and cash equivalents 3 94,539,376 105,805,685Other receivables 1,484,421 1,530,313Other 2,575,347 2,019,898Total current assets 98,599,144 109,355,896 Non-current assetsCapitalised exploration and evaluation 4 981,672 653,514Capitalised mine development 5 157,471,924 62,132,204Property, plant and equipment 6 1,902,993 1,699,808Capitalised borrowing costs 7 - 7,506,115Other receivables 7,343,436 2,292,213Other - 36,553Total non-current assets 167,700,025 74,320,407Total assets 266,299,169 183,676,303 Current liabilitiesTrade and other payables 11,832,109 7,974,515Provisions 258,566 208,966Total current liabilities 12,090,675 8,183,481 Non-current liabilitiesBorrowings 8 43,361,006 -Provisions 1,561,532 714,990Deferred revenue 4,821,000 4,948,046Total non-current liabilities 49,743,538 5,663,036Total liabilities 61,834,213 13,846,517Net assets 204,464,956 169,829,786 EquityIssued capital 9 213,444,499 175,718,629Reserves (576,077) 120,686Accumulated losses (8,403,466) (6,009,529)Total equity 204,464,956 169,829,786

The accompanying notes form part of these consolidated financial statements.

CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN EQUITYFOR THE SIX MONTHS ENDED 31 DECEMBER 2012

Share Foreign Total based currency Issued Accumulated payment translation capital losses reserve reserve $ $ $ $ $ Restated Balance at 1 July 2011 21,882,774 (6,340,742) 799,630 (726,172) 15,615,490Profit for the period - 413,165 - - 413,165Other comprehensive loss - - - (129,278) (129,278)Total comprehensive - 413,165 - (129,278) 283,887 profit / (loss) for the period Transactions with owners, recognised directly in equityShares issued during the 153,835,855 - - - 153,835,855 period, net of costsShare based payments - - 89,207 - 89,207Balance at 31 December 175,718,629 (5,927,577) 888,837 (855,450) 169,824,439 2011 Balance at 1 July 2012 175,718,629 (6,009,529) 1,219,113 (1,098,427) 169,829,786Loss for the period - (2,393,937) - - (2,393,937)Other comprehensive loss - - - (980,091) (980,091)Total comprehensive - (2,393,937) - (980,091) (3,374,028) profit / (loss) for the period Transactions with owners, recognised directly in equityShares issued during the 37,725,870 - - - 37,725,870 period, net of costsShare based payments - - 283,328 - 283,328

Balance at 31 December 213,444,499 (8,403,466) 1,502,441 (2,078,518) 204,464,956

2012

The accompanying notes form part of these consolidated financial statements.

CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWSFOR THE SIX MONTHS ENDED 31 DECEMBER 2012 6 months to 6 months to 31 December 2012 31 December 2011 $ $ Restated Cash flows from operating activitiesPayments in the course of operations (3,276,310) (1,980,230)Deferred revenue received - 4,948,046Income tax paid (Kenya) - (8,686)Net cash generated by / (used in) (3,276,310) 2,959,130 operating activities Cash flows from investing activitiesInterest receipts 2,269,632 1,781,595Payments for exploration and evaluation (335,196) (3,723,754)Purchase of property, plant and equipment (639,005) (2,255,856)Payments for mine development (95,191,297) (8,174,540)Security deposits (563,476) (42,555)Net cash used in investing activities (94,459,342) (12,415,110) Cash flows from financing activitiesProceeds from issue of shares 40,000,000 162,304,403Payment of share issue costs (2,274,130) (8,468,548)Proceeds from debt financing 50,138,400 -Debt finance facility fees (728,822) (5,396,095)Net cash provided by financing activities 87,135,448 148,439,760 Net increase in cash held (10,600,202) 138,983,780Cash at beginning of period 105,805,684 7,284,459Effect of exchange fluctuations on cash (666,106) (12,995) heldCash at end of period 94,539,376 146,255,244

The accompanying notes form part of these consolidated financial statements.

A full PDF version of the announcement is available at the Company's website:www.baseresources.com.au.

ENDS

For further enquiries contact:

Contacts: Base Resources LimitedTim CarstensManaging DirectorEmail: [email protected]: +61 (8) 9413 7400

RFC Ambrian Limited (Nominated Adviser and Broker)As Nominated Adviser

As Broker

Andrew Thomson or Trinity McIntyre Caspar Shand-KyddPhone: +61 (8) 9480 2500

Phone: +44 20 3440 6800 Tavistock Communications (UK Media Relations)Jos Simson/ Jessica Fontaine / Emily FentonPhone: +44 20 7920 3157 Cannings Purple (Australian Media Relations)Annette Ellis / Warrick HazeldineEmail: [email protected]@canningspurple.com.auPhone: +61 (8) 6314 6300 Corporate Details: Board of Directors:Andrew King Non-Executive ChairmanTim Carstens Managing DirectorColin Bwye Executive DirectorSam Willis Non-Executive DirectorMichael Anderson Non-Executive DirectorTrevor Schultz Non-Executive DirectorWinton Willesee Non-Executive Director/ Company Secretary Principal & Registered Office: Contacts:Level 1 Email: [email protected] Kings Park Road Phone: (08) 9413 7400West Perth Fax: (08) 9322 8912WA 6005 About Base Resources

Base Resources Limited (ASX:BSE AIM:BSE) is developing the world-class KwaleMineral Sands Project in Kenya, East Africa. Kwale is an advanced and highlycompetitive project in a sector with a significant forecast supply shortfallwidely expected to emerge in the medium term.

The Kwale Project represents an advanced development opportunity with allmaterial project approvals, permits and licenses required for developmentsecured, funding in place and construction of all project elements underway.

The Project enjoys a high level of support from the Government of Kenya as wellas the local community and, located just 50km from Mombasa, Kenya's principalport facility, is well serviced by existing physical infrastructure.

Importantly, two pilot plant operations at Kwale provide confidence inprocessing behaviour and indicate a suite of readily marketable products. TheProject's high value mineral assemblage and low stripping ratio result in aprojected revenue to cash cost ratio that would place Kwale in the top quartileof world producers.

A realistic development time line should see the Kwale Project in production inthe second half of 2013.