Zanaga Iron Ore Company Ltd Pre-Feasibility results

TIDMZIOC

RNS Number : 7681O

Zanaga Iron Ore Company Ltd

16 October 2012

PRESS RELEASE

London, 16 October 2012

Pre-Feasibility results for the Zanaga iron ore project

Zanaga Iron Ore Company ("ZIOC") (AIM: ZIOC) is pleased to announce positive results from a Pre-Feasibility Study ("PFS") for the Zanaga iron ore project in the Republic of Congo.

The PFS has recommended that the optimum scope of work for initial development of the Zanaga mineral resource would comprise an open pit, low strip mining operation and a concentrator. This would produce 30 million dry tonnes per annum of high quality 68% iron content product over a mine life in excess of 30 years.

The PFS assessed the optimal product transport option would be a 380 kilometre slurry pipeline with a single pumping station and a new deep-water port which would be located approximately 9 kilometres north of existing oil and general cargo port facilities at Pointe Noire.

The PFS has estimated capital expenditure of US$7.4 billion1 and lowest quartile operating cost, including shipping to China.

The project will now move into full Feasibility Study, the outcomes of which will guide a decision on whether to develop the Zanaga project's 6.8 billion tonne mineral resource2.

ZIOC Chairman, Clifford Elphick, said: "This PFS represents a pivotal moment in the development of the Zanaga project. These results confirm that Zanaga is one of the most attractive undeveloped iron ore projects globally, with the potential to offer a low cost long life operation capable of producing a premium high quality iron ore product, with significant expansion potential."

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   Contacts 
 
   Zanaga Iron Ore Company: 
   Andrew Trahar 
   Corporate Development and Investor 
   Relations Manager 
   Telephone: +44 207 399 1105 
   Email: at@zanagairon.com 
 
   Liberum Capital Limited 
   NOMAD, Financial, Adviser and 
   Joint Corporate Broker 
   Chris Bowman, Christopher Britton 
   and Christopher Kololian 
   Telephone: +44 20 3100 2000 
 
 Citigroup Global Markets Limited 
  Joint Corporate Broker 
  Alex Carter 
  Telephone: +44 20 7986 4000 
 Pelham Bell Pottinger 
  Financial PR 
  James MacFarlane and Daniel Thole 
  Telephone: +44 20 7861 3232

Notes for editors:

About Zanaga Iron Ore:

Zanaga Iron Ore Company Limited is listed on AIM, ticker: ZIOC, and is the owner of 50% less one share interest in the Zanaga Iron Ore Project based through its joint venture partnership with Xstrata.

Zanaga iron ore project:

The Zanaga project is located 30km west of the town of Zanaga, a regional centre of the Lekoumou Department of the southern Republic of Congo. This is 250km northwest of the capital, Brazzaville, and 300km northeast of the major oil port, Pointe Noire. It is a joint venture between Xstrata (50% plus one share) and the Zanaga Iron Ore Company (50% less one share). The project has been managed by Xstrata Iron Ore since February 2011 and is currently in the Feasibility Study stage which is due for completion in Q2 2014.

1 Estimated capital cost in today's terms, before including potential future inflation. Further feasibility level studies are required to improve the level of definition of this estimate.

2 Resource upgrade, announced 4 September 2012, available on www.zanagairon.com

This information is provided by RNS

The company news service from the London Stock Exchange

END

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