Bushveld Minerals Regulatory News (BMN)

AIM: BMN

Bushveld Minerals Ltd

("Bushveld" or the "Company")

Resource update: Company progressing towards 1 billion tonnes

Bushveld Minerals Limited, a mineral development Company focused on iron and tin projects in southern Africa is pleased to provide an update on its exploration programme at its Bushveld iron ore project.

Highlights:

·; Drilling programme: Excellent progress with drilling programme on both the P-Q Magnetite Zone ("P-Q Layer") and the Main Magnetite Layer (1,525 metres drilled on the former, and 925 meters drilled on the latter), sufficient to upgrade resource into indicated category and increase strike length by 1km.

·; Resource update:Resource being expanded through drilling on the strike extensions with the Company on track to meet the 1 billion tonne milestone as well as upgrading most of the inferred resource that was announced on admission to AIM, to an indicated resource category.

·; Geological and geotechnical model: Robust model completed, which more clearly defines mineralisation within the P-Q Magnetite Zone and confirms consistency and continuity of these zones along strike and depth.

·; Consolidation of prospecting properties: Programme initiated over existing licences covered by Bushveld's target mineralisation. Section 102 application to extend area under the Company's prospecting license and increase the identified mineralisation strike footprint by 75% is nearing completion.

CEO of Bushveld Minerals, Fortune Mojapelo said: "I am very pleased to report that we are making good progress with our exploration programme at Bushveld. We are on track towards the target of increasing the iron ore resource from 633 million tonnes to more than 1 billion tonnes (including indicated and inferred resources) and completing our scoping study by the end of March 2013."

Drilling Programme and Resource Update

Since admission to AIM in March 2012, the Company has continued to expand the resource through drilling on the strike extensions identified and is on track to meet the 1 billion tonne milestone. The data from the additional drilling was consistent with the previous data that yielded the 633 million tonne maiden resource that was initially declaredin March 2012.

·; Resource drilling on the P-Q Magnetite Zone: The drilling consisted of two boreholes to extend the strike of the mineralisation as well as three in-fill boreholes designed to upgrade the inferred resource to an indicated resource category. Assay results have been received for the five boreholes drilled in 2012, all of which intersected the mineralisation with grades comparable to those of the first phase drilling programme. This drilling has resulted in a ~25% increase in the known strike length of the mineralisation as previously announced in the June 2012 operational update.

·; Shallow drilling on P-Q Magnetite Zone: 31 boreholes have been drilled since June 2012 to evaluate the shallow weathered portion of the mineralised zone that is not included in the current resource estimate. Core samples are currently being analysed with preliminary results indicating mineralisation consistent with the fresh unweathered zone. This weathered resource is not included in the 633 million tonne resource declared thus far, and will be included in a further resource update due Q1 2013.

·; Resource drilling on the Main Magnetite Layer: In-fill drilling to expand the existing resource and conversion of most of the inferred resources to the indicated category is on track. Nine boreholes have been completed since June 2012 and results are expected by the end of October 2012, with an upgrade of the resource to an indicated resource category anticipated.

Results of this drilling programme, including assay results from Setpoint Laboratories, together with the recently completed detailed geological model are being incorporated into a resource model in time for a resource upgrade before the end of the 2012 calendar year.

Geological model

P-Q Magnetite Zone:

The Company has completed a robust geological and geochemical model for the magnetite layers of the P-Q Magnetite Zone, which makes up the bulk of the maiden resource (the Company's maiden resource of 633 million tonnes consists of 567 million tonnes of the P-Q Layer and 66 million tonnes of the Main Magnetite Layer). The model provides a more detailed analysis of the orebody, and forms the framework for the updated resource evaluation, mineralogical and metallurgical testing, and preliminary mine planning studies currently underway.

Importantly, the model defines a number of key magnetite and related marker units within the composite P-Q Magnetite Zone. These units are distinguishable in terms of iron ore content, and are identifiable in all the boreholes by their geological and geochemical characteristics, as well as their grade, reinforcing the recognised continuity of the P-Q Magnetite Zone. The P-Q Layer resource has as an estimated preliminary grade average of 33.2% Fe over an average 45 meter thickness. The geological model further characterises this mineralised zone into two main ore 'sub-zones' which are laterally and vertically continuous and are robust enough to form distinctive potentially mineable packages. These are:

·; Massive magnetite: Average width of 15 meters and a grade average of >40% Fe. This zone is characterised by largely massive magnetite with minor discrete, largely barren bands. It is thought that this massive zone can potentially be concentrated following crushing and magnetic separation only, significantly lowering production costs.

·; Disseminated magnetite: Averaging widths of 20 - 30 meters and a grading at almost 30% Fe. The magnetite ore in this zone is likely to be extractable through grinding to below 200 microns.

Petrological, mineralogical and metallurgical studies are all underway on both ore types as is the resource update calculation, integrating all drilling that has been carried out on the unweathered P-Q Magnetite Zone. The completion is scheduled for the current year of 2012 (the weathered resource will be incorporated in Q1 2013).

Main Magnetite Layer:

A detailed geological model of the Main Magnetite Layer, similar to the model defined above for the P-Q Magnetite Zone is being developed and is expected to also show a distinct massive magnetite and disseminated magnetite layer within the mineralised zone. This is expected to be incorporated into a resource upgrade in the first quarter of 2013.

Consolidation of prospecting properties

A process of consolidating the prospecting licences on several farms not already part of Bushveld Minerals on the northern limb of the Bushveld Complex is continuing and making steady progress. This process consists of:

·; An application to the Department of Mineral Resources in terms of Section 102* of the MPRDA, to extend the mineral rights under 95PR to include two farms to the south of the current resource. These will increase the area covered by the iron ore prospecting rights from 7,409 hectares to 11,975 hectares. Data at the Company's disposal suggests that this will increase the identified mineralisation strike footprint by 75%. Once the process has been completed, the Company will move rapidly to drill a 4km extension to a minimum of the inferred category. This application is in its final stages and granting is imminent.

·; Several earn-in transactions in respect of prospecting rights on contiguous farms held by identified third parties are underway and are expected to be concluded during the current calendar year. Acquisitions of these prospecting rights will significantly add to the mineralisation strike footprint under BMN's iron ore project.

Progress with regard to the Tin Project is ongoing and further details will be provided in a separate operational update.

* Section 102 is an application with the South African Department of Mineral Resources to extend existing licence areas onto adjacent licence areas.

Enquiries: info@bushveldminerals.com

This information is provided by RNS

The company news service from the London Stock Exchange

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Notes to the editor

Bushveld Minerals Limited is a mineral development company focused on the Bushveld Iron Ore Project and the Mokopane Tin Project, both located on the northern limb of the Bushveld Complex, South Africa.

The Bushveld Iron Ore Project comprises two licenses covering 7,409 ha where a JORC compliant open-castable resource of 633 million tonnes (comprising 260 million tonnes Indicated and a further 373 million tonnes Inferred) has been established from a 4.5 km strike length. Further drilling along strike is expected to significantly add to the resource on the basis of identified strike extensions several kilometres long to the north and south of the project area with a target resource planned in excess of 1 billion tonnes. A scoping study on the project is underway for completion in Q1 2013.

The Mokopane Tin Project consists of one licence covering 13,422 ha of open-castable disseminated tin resource. The Company has explored one target and plans to drill at a further four targets. The Company has a JORC resource in excess of 5,000 tonnes of tin and is looking to expand the resource base by undertaking a drilling programme on the other three targets in the licence area and one target in a licence area currently under application. In the longer term, the Company intends to expand the resource base by acquiring further projects.

The Company was admitted to the Alternative Investment Market of the LSE in March 2012.