RESPONSE TO ASX PRICE AND VOLUME QUERY AND LIFTING OF TRADING HALT FIRESTONE ENERGY LIMITED (Incorporated in Australia) (Registration number ABN 058 436 794) Share code on the JSE Limited: FSE Share code on the ASX: FSE ISIN: AU000000FSE6 (SA company registration number 2008/023973/10) ("FSE" or "the Company") RESPONSE TO ASX PRICE AND VOLUME QUERY AND LIFTING OF TRADE HALT 3 September 2012 The Manager Company Announcements Australian Securities Exchange Limited Level 8, Exchange Plaza 2 The Esplanade Perth WA 6000 Attention: Fiona Murphy Dear Ms Murphy ASX Price and Volume Query Further to your letter dated 30 August 2012, Firestone Energy Limited confirms the following: 1. Is the Company aware of any information concerning it that has not been announced which if known, could be an explanation for recent trading in the securities of the Company. Yes, the Company is aware of information that has not been announced that could explain the price and volume movement. The Company has made several announcements (the most recent being on 31 July 2012, within the quarterly report), updating the progress of a major financial restructuring, the main announcements being; • 7 May 2012 financial restructure announced; • 22 May 2012 Update on financial restructure; • 25 July Firestone signs Key Investment agreement; and • 23 August Firestone appoints CFO. The Company was informed on 1 September 2012 that Ariona Company SA, the party providing funding to the Company in the amount of A$40.7 million has completed technical, legal and financial due diligence to their satisfaction. The new convertible note facility is still subject to other conditions precedent, with the most significant being: 1) Obtaining all necessary regulatory approvals in Australia and South Africa; and 2) Obtaining Firestone shareholder approval to the issue and for the conversion of the new convertible notes to be issued to Ariona. 2. If the answer to question 1 is yes, can an announcement be made immediately? If not, why not, and when is it expected that an announcement will, be made. Yes, the Company will make an announcement immediately. 3. Is there any other explanation that the Company may have for the price and volume change in the securities of the Company The Company is not aware of any other reason for the price volume change in its securities. 4. Please confirm that the Company is in compliance with the listing rules and, in particular, listing Rule 3.1. The Company confirms that it is in compliance with the listing rules and in particular listing rule 3.1. Yours faithfully ________________ David Knox CEO www.firestoneenergy.com.au SPONSOR RIVER GROUP 3 SEPTEMBER 2012 Date: 03/09/2012 07:20:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.