Rail and Port Infrastructure Development Update (9679W)

TIDMBZM

RNS Number : 9679W

Bellzone Mining PLC

30 November 2010

Bellzone Mining plc

("Bellzone" or the "Company")

Rail and Port Infrastructure Development Update

Bellzone Mining plc (AIM:BZM), the iron ore and nickel/copper company developing the Kalia Iron Mine in the Republic of Guinea, West Africa, is pleased to announce that:

-- Kalia Logistics SA ("KLS"), a 100% owned Guinea subsidiary of Kalia Horizons Minerals Pte Ltd ("KHM"), has been established

-- The Socio-economic impact assessment studies ("SEIA") and environmental impact assessment studies ("EIA") contracts have been awarded to SGS Environment ("SGS") and work has commenced on both studies

-- Scoping stage of the feasibility study for the rail and port infrastructure has been completed and consultant contracts are expected to be issued soon

KHM, the Singapore registered infrastructure company, which has received $40 million of funding from China International Fund Limited ("CIF"), and will be owned 90:10 by CIF and Bellzone Infrastructure Ltd respectively, has completed the formation of KLS, a 100% owned Guinea subsidiary. KLS will be the operating entity that will undertake the in-country development work for the rail and port infrastructure required to support the export of iron ore from the Kalia Mine.

KLS has completed an SEIA and EIA tender adjudication process and has awarded contracts for the rail and port locations to SGS. This is a crucial step in project development as these impact assessment studies are a key part of the overall feasibility study and will provide important design and risk mitigation outcomes for the project.

SGS have significant in-country experience with developing and implementing SEIA and EIA studies and securing government approvals. SGS are also conducting the Kalia Mine SEIA and EIA studies enabling a joined up approach to the project.

The scoping stage of the rail and port infrastructure detailed feasibility studies has been completed by China Rail Eryuan Engineering Company ("CREEC") and China Communication Construction Company's ("CCCC") Second Harbour Consultants Co. respectively. The scope provides for the initial development of a 100mtpa iron ore transport and export system, which will have the capacity to be expanded to a 300mtpa system as the large bulk commodity projects in Guinea are developed. Following these operational advances, it is expected that the rail and port infrastructure feasibility study contracts will be issued soon.

Nik Zuks, Chief Executive Officer commented: "Another major milestone in the development of this exciting iron ore project in Guinea has been achieved. There has been a tremendous amount of internal work done by both Bellzone and CIF in the special purpose company, KHM, in finalising the strategy for the implementation of the staged 100mpta to 300mpta rail and port infrastructure that will provide a logistics solution for the Kalia mine as well as open up the iron resources in the Simandou area and the bauxite resources to the north of Kalia. Putting the rail and port in place is a game changer for the bulk materials producers in Guinea and we are proud to be the leaders of this development.

This further demonstrates CIF commitment to the Bellzone partnership and to development in Guinea."

Enquiries:

 
Bellzone Mining plc 
 Graham Fyfe/Terry Larkan             +61 8 9420 8900 
Canaccord Genuity Limited 
 Nominated Adviser and Joint Broker 
 to Bellzone 
 Andrew Chubb/Tarica Mpinga           +44 (0)20 7050 6500 
Renaissance Capital Limited 
 Joint Broker to Bellzone 
 Simon Matthews/Thomas Beattie        +44 (0)20 7367 7777 
Conduit PR                            +44 (0)20 7429 6603 
 Jos Simson/Paul Youens               +44 (0)7899 870 450

Bellzone Mining plc

Bellzone Mining plc is an exploration and resource development company with iron ore and nickel / copper permits in the Republic of Guinea, West Africa.

The Company's flagship project, the Kalia Iron Mine has a JORC resource of 3.74 billion tonnes, located on the Kalia I prospect. Drilling results and internal estimates indicate that Kalia Prospect has the potential to host more than 10 billion tonnes of magnetite and 2.55 billion tonnes of oxide at surface.

Exploration work continues to further define the potential at Kalia I on both the magnetite and oxide at surface.

Bellzone is committed to the staged development of the Kalia Iron Project, which includes a 50mtpa iron ore facility, rail and port, with initial production scheduled in 2014. Stage one is planned to bring online 20mtpa direct shipping ore ('DSO') capacity in 2014 and a 10mtpa magnetite concentrator in 2015. Stage two increasing the DSO output to 30mtpa in 2017 and doubling the concentrate capacity to 20mtpa by 2018.

Bellzone signed an Infrastructure Accord with the Republic of Guinea giving the Company exclusive rights to the designated port and rail areas for purposes of conducting studies for the development of the infrastructure leading to the signing of a convention and concession. The infrastructure forms a key part of the Guinea Government's infrastructure strategy and will support the development of iron ore, bauxite and other minerals in Guinea through its availability for 3rd party use.

On 2 August 2010, Bellzone signed definitive agreements with China International Fund ("CIF"). CIF will finance and develop the rail and port infrastructure and offer a finance package to Bellzone for the development of the Kalia Mine in exchange for the first right to purchase 100% of the off-take of the Kalia Mine at market price.

An exploration programme is currently underway at the Forecariah Iron Permits that lie between 40 and 80kms from the Guinea coast. Bellzone and CIF will jointly develop these permits which are prospective for oxide and magnetite. The oxide has the potential to deliver cash flow from a Direct Shipping Ore project in the short term.

Bellzone has competed an intensive mapping and surface sampling programme and has defined highly prospective drilling targets at its Sadeka Nickel/Copper Project and will commence a drilling programme on these targets in Q4 2010.

This information is provided by RNS

The company news service from the London Stock Exchange

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