BHR.L Regulatory News (BHR)

Beacon Hill Resources Plc / AIM: BHR / ASX: BHU / Sector: Mining

1 February 2013

Beacon Hill Resources Plc ("Beacon Hill" or the "Company")

Rolling Stock Operating Lease Signed for the Sena Line

The Board of Beacon Hill is pleased to announce that on 31 January 2013 its wholly-owned subsidiary, Minas Moatize Limitada ("MML"), signed an operating lease agreement ("Lease Agreement") with Thelo Rolling Stock Leasing Proprietary Limited ("Thelo"), for the provision of rolling stock on the Sena railway line in Mozambique (the "Sena Line") connecting Tete with the Port of Beira.

Transaction Highlights

·; Thelo will lease to MML five Grindrod RL30SCC-3 'as new' locomotives for a term of 10 years;

·; Thelo will also lease to MML ninety new Gondola-type coal wagons fitted with the patented Sheffield bogey system for a term of 10 years;

·; MML has appointed RRL Grindrod Locomotives Proprietary Limited ("RRL Grindrod") as its rail services operator. RRL Grindrod will assume day-to-day responsibility for MML's train operations on the Sena Line. RRL Grindrod will shortly commence its implementation plan, including the mobilisation of rail operating staff.

The Lease Agreement is an important milestone for Beacon Hill and a prerequisite of obtaining final rail allocation confirmation from Portos e Caminhos de Ferro de Moçambique. Until the expected commencement of rail operations in Q3 2013, the Company will continue to make use of trucks to transport coal to the Port of Beira as an interim solution.

The Lease Agreement remains subject to the fulfillment of a number of suspensive conditions, including inter alia (a) final approval of export cover insurance from the Export Credit Insurance Corporation of South Africa SOC Ltd; and (b) procuring satisfactory all risks insurance cover in respect of the locomotives and the wagons. Discussions in this regard are progressing well. The stated suspensive conditions must be fulfilled prior to 28 February 2013, unless waived or extended by MML and Thelo.

Rowan Karstel, Managing Director of Beacon Hill, commented:

"We look forward to working with our new rail consortium. The new rolling stock is an important milestone for our coal export operations on the Sena Railway line".

Ronnie Ntuli, Director of Thelo, commented:

"We are very proud to be associated with BHR and MML and pleased to be able to provide our client and Mozambique with a tailored and comprehensive new rolling stock financing solution".

Justin Farr-Jones, Chairman of Beacon Hill, commented:

"I'd like to thank both Thelo and my own team for the enormous effort involved in finalising the Lease Agreement. This was a cross-border transaction involving multiple parties forging new long term relationships in Mozambique. Our rail consortium comprises the best talent operating in Africa today."

 ENDS

Note:

About Beacon Hill

Beacon Hill, dual listed on the AIM market of the London Stock Exchange (Code: BHR) and the Australian Securities Exchange (Code: BHU), is focused on building and developing a portfolio of near term production projects in commodities relating to the steel production industry.

Beacon Hill currently has three projects that provide the group with exposure to the steel production industry - the Minas Moatize Coal Project (Mozambique), the Changara Coal Project (Mozambique) and the Arthur River Magnesite Project (Australia).

About Thelo

Thelo is 50% owned by Thelo Rolling Stock Partnership and 50% owned by the Industrial Development Corporation, a South African government-owned institution focused on promoting economic growth and industrial development in South Africa.

Thelo leases rolling stock (locomotives, wagons and passenger cars) to rail operators and freighters in Sub-Saharan Africa.Responding to the increasing need for modern, reliable rolling stock in this market, Thelo strives to alleviate the sizeable rolling stock backlog by providing innovative and cost-effective financial solutions to rail operators and freighters.Thelo forms an important part of Thelo Group's, its parent company, regional strategy of originating, investing in and operating critical infrastructure and capacity expansion in the transportation sector.