Dourado Resources Limited

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2012 is shaping up as a busy year for Dourado Resources as it ramps up exploration atboth Moologool/Diamond Well (40 kilometres south of Sandfire Resources’ De GrussaProject,14.6Mt @ 4.6% Cu. 1.6 g/t Au) and the Sabbath/Garden Gulley gold projectslocated near the Doray Minerals Andy Well Project (45 kilometres north of Meekatharra)drilling over 2010-2011 has been successful in returning Inferred and Indicated goldresources to 691,000t @ 14.8g/t for 329,000 ounces of gold.

As noted in our recent Yerrida Basin-Goodin Dome review (What’s Going On? RMResearch, 1/9/2011) and research report (Dourado Resources, RM Research,17/10/2011), the Company holds the majority of what RM Research considers to be themost prospective acreage including the majority of the iron-stone “necklace” thatsurrounds the ellipsoidal and highly deformed granite body known as the “Goodin Dome”.These Cu +/- Au anomalies have a total apparent combined strike length (across 13anomalies) of around 140 kilometres.

Our site visit (October 2011) confirms the presence of extensive shale and graphiticshales on the Diamond Well/Moologool tenements which are known to host economicmineralisation at De Grussa and also mineralisation along with recent discoveries atEnigma (Sipa Resources Ltd, ASX: SRI)) and Thaduna/Green Dragon (VentnorResources Ltd, ASX: VRX). Notably SRI is up approximately 270% since its Enigmaannouncement (19/8/2011) and VRX recently hit A$1.01 up just over 250% sincereturning further high-grade copper hits at Thaduna/Green Dragon (29/8/2011).

We anticipate the balance of the assays from the 48 hole, 2,774 metre RAB program atDiamond Well/Moologool in the coming weeks. Initial assays reported in Late November2011 revealed anomalous copper up to 709ppm from Geochemical Zones 1 and 2 overwidths of up to 50 metres. Soil sampling over zones 7 and 11 also confirmed thepresence of NNE-SSW trending copper anomalism that are likely mirroring regionalstructures on the eastern side of the Goodin Dome granite intrusion.

At the Sabbath Gold Project, the first phase of the program will consist of nine RC drillholes designed to test mineralisation down dip and down plunge of the knownmineralisation. This is likely to be followed by around 115 RC holes (approximately 14,000metres) at 200 metre x 50 metre centres targeting additional mineralisation on the lease.The second phase of drilling will target mineralisation north and south of Sabbath andmineralisation along parallel structures.

A 151 hole auger program on Garden Gully North (E51/1427) was completed in late 2011however rain halted the program prematurely. Drilling is about to resume in the comingweeks with results likely due in late March 2012. This program is focussing on the areaalong strike from the old workings, in particular along NE to NNE striking faults/shearzones.

Aggressive drill programs in two highly prospective Cu-Au (Moologool/Diamond Well) andAu (Garden Gully/Sabbath) terrains north of Meekatharra situated close to recentdiscoveries are likely to maintain a healthy level of investor interest. Look out for results ofRAB drilling at Moologool/Diamond Well undertaken in Late CY 2011.

Capital Structure

Sector Materials

Share Price (A$) 0.17

Fully Paid Ordinary Shares (m) 260.1

Opt (ex 20c, exp 30/11/14) (m) 213.1

Market Cap (undil) (A$m) 44.2

Share Price Year H-L (A$) 0.30-0.13

Approx Cash (A$m) 0.75

Directors & Management

Graeme Allan Non-Exec Chairman

Emilio Del Fante Managing Director

Daryl Smith Non-Executive Director

Shane Casley Non-Executive Director

Robert Marusco Company Secretary

Major Shareholders

Geographe Mining P/L <Geog. Min.A/C> 6.6%

Lennonville Expl P/L <Lenn. Expl A/C> 6.4%

Greek Mining P/L <Greek Mining A/C> 5.8%

Raptor Mining P/L <Raptor Mining A/C> 5.7%

Analyst

GT Le Page +61 8 9321 3277

Share Price Performance

UUPPDDAATTEEDourado Resources LimitedSabbath Gold Project...RC drilling commencing shortly

16th January 2012

ASX Code: DUOSpeculative Buy

www.rmresearch.com.au

– Copyright © 2012 RM Research - www.rmresearch.com.au

16 January 2012

INVESTMENT CASEEXCEPTIONAL TARGETS: The strategic location of Sabbath/Garden Gully in the samegeological setting as the high-grade Andy Well Project (DRM: 691,000t @ 14.8g/t for 329,000ounces of gold) gives us confidence that further gold mineralisation will be found in the currentdrill program at Sabbath.

Our October 2011 site visit to Mooloogool/Diamond Well confirms the existence of shearedsediments (including black shales, graphitic sediments) associated with the iron-stone“necklace” that surrounds a highly deformed, ellipsoid shaped Goodin Dome granite intrusion.Examination of published reports from THX, SFR, VRX and SRI indicates that much of theCu+/-Au mineralisation is closely associated with black shales/graphitic sediments (either asvolcanogenic massive sulphide or hydrothermally emplaced mineralisation) that are thepreferred hosts of Cu+/-Au mineralisation in the district.

FAVOURABLE STRUCTURES: ENE trending shear zones within mafic lithologies known tobe associated with gold mineralisation at Andy Well have been identified at Sabbath/GardenGully. At Moologool/Diamond Well, RM Research considers there are major structures withpotential to host Cu, Cu+/-Au mineralisation.

LEVERAGE TO SUCCESS: The stellar performance of DRM over 2011 (peaking at A$1.64 inNovember 2011) is a good example of market recognition for high-grade gold resources in theMeekatharra district. The enterprise values of SFR at A$1.0b together with recent share pricejumps from VRX (22 cents pre-announcement and recently peaking at A$1.01) and SRI (7.3cents and reaching 21 cents) suggests that exploration success in the Goodin Dome regioncould also be similarly rewarded.

COMPANY OVERVIEWDourado Resources Limited (“Dourado Resources”,“DUO” or “the Company”) is a Perth based explorationcompany that has been established to predominantlyexplore for deposits of gold, copper and uraniummineralisation. The Company was listed on ASX on 1December 2009 raising A$4.4 million.

The exploration portfolio at the time of listingcomprised of three gold and base metal projects in theMurchison region (Western Australia) and a uraniumproject in the Arunta region (Northern Territory).

In recent years there has been renewed interest inexploration for Cu, Cu-Au in the Doolgunna region,particularly since the discovery of SFR’s DeGrussadeposit (14.6Mt @ 4.6% Cu, 1.6 g/t Au). Following therecent acquisition of Anuman Holdings Pty Ltd, theCompany now holds over 2,800km2 on itsMooloogool/Diamond Well tenements in the YerridaBasin – Goodin Dome region. This success has been

followed up with further high-grade oxide Cu mineralisation (including 8m @ 3.7% Cu) at theEnigma Prospect (SRI) and high-grade Cu intersections by VRX at their Thaduna/GreenDragon Projects (Ventnor Resources, RM Research, 1/9/2011, 18/11/2011) situatedapproximately 40 kilometres east of De Grussa.

The 2010 discovery of high-grade gold resources at Andy Well by DRM north of Meekatharrahas also given the Company further encouragement to also pursue an aggressive explorationprogram at Sabbath and Garden Gully.

RM Research believesthat exploration successin this new Cu +/- Auprovince is likely to behandsomely rewarded

FIGURE 1: DouradoResources Limitedproject locations (source:Dourado ResourcesPresentation, 6th

September 2011).


– Copyright © 2012 RM Research – www.rmresearch.com.au

16 January 2012

REGIONAL DEVELOPMENTS-Gold

In our last publication (17/11/2011) we focussed on the regional Cu+-Au developments,notably SFR, VRX and SRI. In this report we are focussing on the gold potential of the AndyWell area. Doray Minerals Ltd (ASX: DRM) has been the star attraction in the district thisyear recently announcing (DRM ASX Announcement 6th December 2011) a 90% increase inInferred and Indicated gold resources at its Andy Well Project (DRM: 80%) situatedapproximately 45 kilometres north of Meekatharra (adjacent to the Great Northern Highway)(Figure 3). The Wilber Lode (Figure 2), associated with two quartz vein lodes, now stands at691,000t @ 14.8g/t for a total of 329,000 contained ounces representing a 90% increase fromthe previously reported resources in February 2011 (311,000t @ 17.5g/t).

Mineralisation has been outlined to around 480 metres below surface and remains open atdepth. RC and diamond drilling is continuing to further upgrade existing resources and to trackmineralisation down plunge together with additional targets adjacent to the Wilber Lode.Aircore drilling is also focussing on other targets on the tenements.

EXPLORATION OVERVIEW

Garden Gully-Sabbath Gold ProjectLocation and Access

This project (Figure 3) covers seven tenements including granted Mining Leases M51/322 andProspecting License Application PLA 51/2699. Both tenements are located approximately 12kilometres north of Meekatharra and centred around the north-north-easting striking line ofworkings including the historical Sabbath Gold Mine.

Geology & Mineralisation

Gold mineralisation is associated with sheared mafic rocks, in particular west dipping shearedfelsic-mafic contacts that contain abundant quartz veins which have been the target ofprevious workings within tenement M 51/322.

FIGURE 2: Wilber Lodelong section, Andy WellProject (source, DorayMinerals Ltd,Presentation, December2011).

Doray Minerals hasbeen the star performerin the Meekatharradistrict over 2011



16 January 2012

Recent ExplorationLarge portions of theMining Lease (M51/322)housing the Sabbathresource have not beendrilled and there is a NE aswell as a NNE mineralisedtrend seen in the plots.There also appears to be astrong southerly plungecomponent to themineralisation. Thisobservation hashighlighted several drilltargets. There are twodrilling programs currentlyunderway.Strike continuations ofmineralisation associatedwith the Abernethy andAirstrip deposits identifiedby DRM to the SW ofSabbath are alsointerpreted to be present inthe DUO Garden Gullytenements. There are alsosimilar parallelmineralisation trendsextending SW fromSabbath and in the NorthGranite Well area.

Resources and Reserves

The Sabbath deposit has a Measured Resource of 145,000 tonnes @ 2.21 g/t Au (cut-offgrade 1g/t Au) based on 19 Reverse Circulation and 36 Air Core drill holes together with 45lines of costean results. Further upside is likely both along strike (under shallow alluvial cover,along old workings), along parallel structures and at depth. There has been very limited drillingbelow 60 metres. Dominion Mining Ltd completing a pit optimisation study in 1994 whichresulted in three pit shells based on a gold price of US$550/ounce however further studiestogether with additional drilling are likely to deepen the pit design further.

FIGURE 3: Garden Gullyand Sabbath Projects(source, DouradoResources Limited,website September 2011).

The Sabbath projectcontains a JORC resourceof 11,750 ounces

FIGURE 4: Sabbath longsection showing potentialdown plunge extensions(source: DouradoResources Limited ASXAnnouncement, 25th

August 2011).



16 January 2012

Sabbath ExplorationThe first phase of the program will consist of nine RC drill holes designed to testmineralisation down dip and down plunge from the known mineralisation. This is likely to befollowed by a further phase of around 115 RC holes (approximately 14,000 metres) at 200metre by 50 metre centres that will follow up additional targets on the lease. The secondphase of drilling will target;

Mineralisation north and south of Sabbath, and

Mineralisation along parallel structures.

Garden Gully South ExplorationA 151 hole auger program on E51/1427 was completed in late 2011 however rain halted theprogram prematurely. Drilling is about to resume in the coming weeks. We anticipate resultswill be available in late March 2012. This program is focussing on the area along strike fromold workings, in particular along NE to NNE striking faults/shear zones.

Some of these structures may represent the extension of mineralisation at the Abernethy andAirstrip deposits (DRM). Mineralisation also remains open along strike to the south-west to theNorth Granite Well area. On E51/1433 around 308 samples were submitted for assay withresults imminent.

Mineralisation remainsopen at depth, alongstrike and on parallelstructures

FIGURE 5: Sabbath GoldProject showing proposedRC drill holes (source:Dourado ResourcesLimited ASXAnnouncement, 21st

December 2011).

Mineralisation remainswide open along strike atGarden Gully



16 January 2012

MOOLOGOOL/DIAMOND WELLResults from the first phase of 48 RAB drill holes (2,774 metres) on anomalies 1, 2, 5 and 6together with drilling on various tracks showed numerous anomalous intersections up to 706ppm copper with anomalous copper over widths of up to 50 metres downhole.

Of significant interest wasthe intersection ofcarbonaceous meta-sediments, siltstones andblack shales which areknown to host Cu+/-Aumineralisation at deGrussa (SFR), Enigma(SRI) and Thaduna/GreenDragon (VRX).

Fine grained sulphides(pyrite?) were alsoidentified at Zones 1, 2and 5 and are associatedwith coincident anomalous

Au, Cu, Pb and Zn soil anomalies. These anomalous zones are in excess of 20 kilometresapart and may reflect the same lithological unit.

Soil sampling overzone 11 (Figure 7)also returned

NNW-SSWstriking copper(+100ppm Cu)anomalism withzone 7 returning aweaker (25-50ppm) Cu

anomaly.Anomalism atzone 11 likelyparallels shearingassocated with the

eastern margin of the Goodin Dome.

OTHER PROJECTS

Mainland Project: (DUO 100%, Western Australia): Gold.

Lennonville Project: (DUO 100%, Mt Magnet Area, Western Australia): Gold.

Barrambie: (DUO 100%, Western Australia): Copper.

Further declines inequity markets could seea move out of riskierasset classes such asjunior resourcecompanies

FIGURE 6: Cross Sectionof Geochemical Zone 2with anomalous copperRAB/AC holes MAC001 –MAC006 (source:Dourado ResourcesLimited ASXAnnouncement, 30th

November 2011).

FIGURE 7: Map ofMoologool north showingsoil anomalies incomparison toreconnaissanceanomalies (source:Dourado ResourcesLimited ASXAnnouncement, 30th

November 2011).



16 January 2012

CORPORATEThe Company raised A$1.07 million in early November 2011 to provide further funds forfurther exploration at both Moologool/Diamond Well and Sabbath/Garden Gully. TheCompany still has its 15% available and we anticipate DUO will be looking to place in theorder of 30-40 million shares +/- options over the next quarter.

RISK ANALYSIS Follow up RC drilling at Sabbath Gold Project may fail to increase the current resource or

identify extensions to mineralisation both along strike and down plunge.

Reconnaissance RAB drilling may not resolve surface Cu+/-Au anomalism atMoologool/Diamond Well. Anomalies (in particular Cu) could be due to buried, transportedsediments or other recent cover sequences.

Follow up exploration at neighbouring projects (Doolgunna area) by SRI and VRX may notlive up to expectations. This may have a negative impact on the perception of theMoologool/Diamond Well tenements of the Company.

The Company is primarily exposed to copper and gold. Copper has weakened from recenthighs of just over US$10,000/tonne in February 2011, to around US$7,600/tonne, inresponse to the European government debt problems and the weaker growth outlook fordeveloped economies. Gold has come off recent highs and may come under pressure asinvestors move back into US$ has economic conditions improve.

Further declines in equity markets may continue to put pressure on junior resourcecompanies as investors switch out of “risk” into perceived safe haven investments suchas cash, gold and counter cyclical equities. Our medium term view is that the riskpremium has been eroded for many junior resource companies and we see near termupside.

A strengthening Australian dollar (as funds flow back into riskier currencies) may makethe price of copper and gold in local (Australian) currency terms less attractive. This couldhave negative influences on Australian copper miners however it is more relevant toproducing companies.

Further declines inequity markets could seea move out of riskierasset classes such asjunior resourcecompanies



16 January 2012

DIRECTORS AND MANAGEMENTGraeme Allan, Dip. Ed. NON-EXEC CHAIRMAN

Mr Graeme Allan is a director of WGM Asset Management Pty Ltd which is in partnership withWGM Indigenous Services Pty Ltd to increase and develop Indigenous employment in the civiland mining industry in the mid-west region (WA). He is also a Director of civil constructioncompany BGA Civil Pty Ltd. Mr Allan has a Diploma in Education and has extensivemanagerial experience covering over a 25 year career in the professional sporting industry.

Emilio Pietro Del Fante MANAGING DIRECTOR

Emilio has 20 years experience in the mineral and resources sector where he is principal ofCorporate Tenement Services. Peter is also a non-executive director of Prime Minerals Ltdand has been a director of two other public listed mining exploration companies one of whichwas Revere Mining Ltd (now Enterprise Metals Ltd). Over the years as a consultant in theresource industry Peter has also gained exposure and experience in many facets of themining industry inclusive of indigenous negotiations, establishment of relationships with thecorporate and banking sector and liaison with governing bodies.

Shane Casley, CPA NON-EXEC DIRECTOR

Shane is currently a managing partner of Victorian based Affinity Accountants which has 20staff and offices in Southbank and Geelong. Mr Casley has 30 years accounting experienceand provides taxation and management advice. He is also a respected advisor in SportsManagement and has been an accredited Australian Football League Agent since 1996. Hewas co-founder of the Football Division of Elite Sports Properties.

Daryl Smith NON-EXEC DIRECTOR

Mr Daryl Smith has experience in the mineral exploration sector and telecommunications andelectronics sector. During his career in the mineral exploration industry he has served on anumber of private and public gold and uranium exploration companies and has extensiveknowledge of and experience in the structuring and financing of mining and explorationprojects. Before joining the industry he served at senior management level in thetelecommunications and electronics sector where he developed his strong corporate andbusiness development skills. He also has experience in strategic tenement acquisition,marketing, mergers and acquisitions.

Robert Marusco, B. Bus., CPA, SIN FIA COMPANY SECRETARY

Robert Marusco is Chairman and Director of Nissen Kestel Harford, Accountants Taxation &Business Advisors and Knight Financial Advisors. He consults to a variety of clients focusingon business development planning, finance and financial planning, taxation planning andcorporate matters. He has experience in a wide variety of other businesses. He has also dealtwith a number of public companies both in the mining sector and general business sector inhis capacity as trustee for capital raisings. This also encompasseses corporate governancemeasures, due diligence, dealing with the ASIC and other statutory bodies.

CONCLUSIONThe Company is likely to continue to target gold mineralisation at Sabbath/Garden Gullywhere RM Research believes there is an excellent chance of substantially increasing theexisting resource base (11Koz) together with finding additional gold mineralisation alongstrike, down plunge and adjacent to known mineralisation. Success by DRM at Andy Wellnearby provides us with ample encouragement for the area.

The Doolgunna-Yerrida Basin area remains one of the hottest spaces in Australian explorationon the back of De Grussa and further outstanding results from VRX and the virgin discover atEnigma by SRI. The presence of favourable host rocks on DUO’s ground place the Companyin an excellent position to find Cu+/- Au mineralisation. Speculative Buy.

Graeme is activelyinvolved in promotingthe civil and miningindustry in the mid-westregion of WesternAustralia

Emilio has in excess of 20years’ experience in theresources sector

Shane was a co-founderof the Football Divisionof Elite Sports Properties

Daryl has extensiveknowledge in thestructuring andfinancing ofgold/uranium companies

Robert has extensiveexperience with bothpublic and privatecompanies



16 January 2012

Registered OfficesPerthLevel 2, 6 Kings Park RdWest Perth WA 6005

Phone: +61 8 9321 3277Fax: +61 8 9321 8399

PO Box 154West Perth WA 6872

Email / [email protected]

RM Research Recommendation CategoriesCare has been taken to define the level of risk to return associated with a particular company.Our recommendation ranking system is as follows:

Buy Companies with ‘Buy’ recommendations have been cash flow positive for some time and have a moderate tolow risk profile. We expect these to outperform the broader market.

Speculative Buy We forecast strong earnings growth or value creation that may achieve a return well above that of thebroader market. These companies also carry a higher than normal level of risk.

Hold A sound well managed company that may achieve market performance or less, perhaps due to anovervalued share price, broader sector issues, or internal challenges.

Sell Risk is high and upside low or very difficult to determine. We expect a strong underperformance relative tothe market and see better opportunities elsewhere.

Disclaimer / DisclosureThis report was produced by RM Research Pty Ltd, which is a Corporate Authorised Representative of RM Capital Pty Ltd (Licence no. 221938). RM Research will receivepayment of A$35,000 for the compilation and distribution of four research reports. RM Research Pty Ltd has made every effort to ensure that the information and materialcontained in this report is accurate and correct and has been obtained from reliable sources. However, no representation is made about the accuracy or completeness of theinformation and material and it should not be relied upon as a substitute for the exercise of independent judgment. Except to the extent required by law, RM Research Pty Ltddoes not accept any liability, including negligence, for any loss or damage arising from the use of, or reliance on, the material contained in this report. This report is forinformation purposes only and is not intended as an offer or solicitation with respect to the sale or purchase of any securities. The securities recommended by RM Researchcarry no guarantee with respect to return of capital or the market value of those securities. There are general risks associated with any investment in securities. Investorsshould be aware that these risks might result in loss of income and capital invested. Neither RM Research nor any of its associates guarantees the repayment of capital.WARNING: This report is intended to provide general financial product advice only. It has been prepared without having regarded to or taking into account any particularinvestor’s objectives, financial situation and/or needs. Accordingly, no recipients should rely on any recommendation (whether express or implied) contained in this documentwithout obtaining specific advice from their advisers. All investors should therefore consider the appropriateness of the advice, in light of their own objectives, financialsituation and/or needs, before acting on the advice. Where applicable, investors should obtain a copy of and consider the product disclosure statement for that product (if any)before making any decision.DISCLOSURE: RM Research Pty Ltd and/or its directors, associates, employees or representatives may not effect a transaction upon its or their own account in theinvestments referred to in this report or any related investment until the expiry of 24 hours after the report has been published. Additionally, RM Research Pty Ltd may have,within the previous twelve months, provided advice or financial services to the companies mentioned in this report. As at the date of this report, the directors, associates,employees, representatives or Authorised Representatives of RM Research Pty Ltd and RM Capital Pty Ltd may hold shares in Dourado Resources Limited.


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