30 September 2014

Updated Reserve Statement for Zanaga Iron Ore Project

Highlights

· Proved Ore Reserves of 770 million tonnes ("Mt") at 37.3% Fe, which supports Stage One 12Mtpa operation for >25 years

· Probable Ore Reserves of 1,290Mt at 31.8% Fe

· Total Ore Reserves of 2,070Mt at 33.9% Fe derived from 6,900Mt 32% Fe Mineral Resource which supports the 30Mtpa two stage development plan over a 30 year mine life

Zanaga Iron Ore Company Limited ("ZIOC" or the "Company") (AIM:ZIOC) is pleased to announce an updated Ore Reserve Statement reported in accordance with the JORC Code 2012, including a maiden Proved Ore Reserve estimate for the Zanaga Iron Ore Project (the "Zanaga Project" or the "Project"), a joint venture with Glencore plc in the Republic of Congo.

Following completion of the Feasibility Study ("FS") and updated Mineral Resource Estimate (announced 8 May 2014), the Ore Reserve statement for the Zanaga Project has been revised to reflect the proposed staged development plan. The previous Ore Reserve statement, announced in November 2012 was estimated based on the previous Pre-Feasibility Study scope, which involved a single development targeting 30Mtpa operating scale from startup. The recently announced FS differs in production profile in that it pursues a two stage development. The Stage One operation would involve operating at an initial rate of 12Mtpa, followed by a Stage Two expansion, nominally scheduled to take place in year 9, which would increase production by an additional 18Mtpa to produce 30Mtpa for the remaining 22 years of the 30 year mine life. As a result of this staged development profile, the FS is now scheduled to mine less ore over the 30 year mine life than the previous PFS, and as such the Total Ore Reserve estimate has been reduced to match this two stage approach.

ZIOC is pleased to announce the definition of the Project's first Proved Ore Reserve estimate of 770Mt, which underpins the Stage One project on a standalone basis for more than 25 years. In addition, the total Proved and Probable Ore Reserve Estimate of 2,070Mt at 33.9% Fe is more than sufficient to support the combined two stage development described above over the scheduled 30 year life of mine.

The Ore Reserve Statement is a key milestone for the Project and supports the economic viability of mining at least 2,070Mt of the 4,790Mt Measured and Indicated Mineral Resource. The significant scale of the Ore Reserve supports the Company's confidence in the quality of the Zanaga Project and is indicative of the rigorous standard that has been applied to all study work conducted to date.

Clifford Elphick, Non-Executive Chairman of ZIOC, commented:

"The announcement of the largest Proved iron ore Reserve in Africa of 770Mt, as well as Total Ore Reserves of 2,070Mt, which is more than sufficient to support the staged development of a large, long life operation over 30 years, reinforces the quality and size of the Zanaga Project in the iron ore sector.

The fact that a Proved Ore Reserve has already been delineated at this stage is testament to the highly detailed study work that has been conducted on the Project."

Ore Reserve Statement

As stipulated by the JORC Code, Proven and Probable Ore Reserve are of sufficient quality to serve as the basis for a decision on the development of the deposit. Based on the studies performed, a mine plan has been determined that is technically achievable and economically viable.

Classification	Tonnes (Bt)	Fe (%)
Proved Ore Reserves	0.77	37.3
Probable Ore Reserves	1.29	31.8
Total Ore Reserves	2.07	33.9

Notes:

1. Long term price assumptions are based on an IODEX 62% Fe forecast of 100 US$/dmt (162 US¢/dmtu at 62% Fe) with adjustments for quality, deleterious elements, moisture and freight.

2. Discount Rate 10%

3. Mining dilution ranging between 5% and 6%

4. Mining losses ranging between 1% and 5%

The Ore Reserve estimate was undertaken by independent consultants, SRK Consulting (UK) Ltd ("SRK") and is based on the 30Mtpa Feasibility Study and the 6,900Mt Mineral Resource recently announced by the Company.

Note : The full Ore Reserve Statement is available on the Company's website (www.zanagairon.com)

Mineral Resource

Classification	Tonnes (Mt)	Fe (%)	SiO₂ (%)	Al₂O₃ (%)	P (%)	Mn (%)	LOI (%)
Measured	2,330	33.7	43.1	3.4	0.05	0.11	1.46
Indicated	2,460	30.4	46.8	3.2	0.05	0.11	0.75
Inferred	2,100	31	46	3	0.1	0.1	0.9
Total	6,900	32	45	3	0.05	0.11	1.05

Reported at a 0% Fe cut-off grade within an optimised Whittle shell representing a metal price of 130 USc/dmtu. Mineral Resources are inclusive of Reserves. A revised Mineral Resource, prepared in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code, 2004 Edition) was announced on 8 May 2014 and is available on the Company's website (www.zanagairon.com).

The Mineral Resource was estimated as a block model within constraining wireframes based upon logged geological boundaries. Tonnages and grades have been rounded to reflect appropriate confidence levels and for this reason may not sum to totals stated.

The Ore Reserves and Mineral Resource announced by the Company are reported in accordance with the terms and definitions included in the JORC Code as at 29 August 2012.

Competent Persons

The statement in this report relating to Ore Reserves is based on information compiled by Mr Gabor Bacsfalusi who is a Chartered Professional Member of the Australasian Institute of Mining and Metals. He is a mining engineer and Senior Consultant of SRK Consulting (UK) Ltd. He has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the JORC Code (2012). The Competent Person, Mr Gabor Bacsfalusi, has reviewed the Ore Reserve Estimate and has given his consent to the inclusion in the report of the matters based on his information in the form and context within which it appears.

The Mineral Resource statement is reported in accordance with the terms and definitions included in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code 2004 edition) as at 30 September 2013. The information in the Report that relates to Mineral Resources is based on information compiled by Malcolm Titley, BSc MAusIMM MAIG, of CSA Global (UK) Ltd. Malcolm Titley takes overall responsibility for the Report as Competent Person. He is a Member of the Australasian Institute of Mining and Metallurgy ("AUSIMM") and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a Competent Person in terms of the JORC Code. The Competent Person, Mr Malcolm Titley, has reviewed this Mineral Resource statement and given his permission for the publication of this information in the form and context within which it appears.

For further information please contact:

Zanaga UK Services Limited

Corporate Development and Andrew Trahar
Investor Relations Manager +44 20 7399 1105

Liberum Capital Limited

Nominated Adviser, Financial Richard Crawley

Adviser and Corporate Broker and Christopher Britton

+44 20 3100 2000

Bell Pottinger

Financial PR Marianne Bowes
and Daniel Thöle

+44 20 3772 2500

About us:

Zanaga Iron Ore Company Limited (AIM ticker: ZIOC) is the owner of 50% less one share in the Zanaga Iron Ore Project based in the Republic of Congo (Congo Brazzaville) through its joint venture partnership with Glencore plc. The Zanaga Iron Ore Project is one of the largest iron ore deposits in Africa and has the potential to become a world-class iron ore producer.

Glossary

AL₂O₃	Alumina (Aluminium Oxide)
Fe	Total Iron
JORC Code	the 2004 or 2012 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves as published by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia
LOI	Loss on ignition
Mineral Resource	a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories
Mn	Manganese
Ore Reserve	the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified. Ore Reserves are sub-divided in order of increasing confidence into Probable Ore Reserves and Proved Ore Reserves. A Probable Ore Reserve has a lower level of confidence than a Proved Ore Reserve but is of sufficient quality to serve as the basis for a decision on the development of the deposit.
P	Phosphorus
SiO₂	Silica