Bellzone Mining Regulatory News (BZM)

5 March 2015

Bellzone Mining plc

("Bellzone" or the "Company")

Financing Update and Restoration of Trading

Bellzone (AIM: BZM) announces that agreement has been reached with China Sonangol International (S) Pte Ltd ("China Sonangol") regarding its working capital funding.

Extension and Amendment of existing Loan Facility

Under this agreement, China Sonangol has agreed to extend and amend the terms of the loan facility of US$4 million, previously announced on 18 August 2014 and amended on 28 January 2015 (the "Loan Facility").

The amendment extends the availability period and the repayment date to 31 March 2018 and increases the total funding available under the Loan Facility from US$4 million to US$10 million. Bellzone has drawn down new funds of US$5 million under the Loan Facility, taking the total drawn to US$8,500,000 and leaving US$1,500,000 remaining available to draw. The amended Loan Facility is expected to provide Bellzone with sufficient working capital for 2015.

This agreement is in place of the previously announced intention to enter into a US$30 million secured debt or convertible loan facility with China Sonangol.

Related Party Transaction

Under the AIM Rules, as a result of its 51.0 per cent. holding in the voting rights of the Company, China Sonangol is a related party of Bellzone. The Independent Directors of Bellzone, being Michael Farrow, Simon Brickles, Antony Gardner-Hillman and James Leahy consider, having consulted with Bellzone's Nominated Adviser, WH Ireland Limited, that the terms of the extension and amendment to the Loan Facility are fair and reasonable insofar as the shareholders of Bellzone are concerned.

Re-admission to trading on AIM

With ongoing financial support from the Company's major shareholder having been re-affirmed, the board of Bellzone has sought the restoration of trading on AIM of the Ordinary Shares of no par value in Bellzone ("Ordinary Shares"). The trading of Ordinary Shares is scheduled to recommence at 7.30am on 6 March 2015.

Strategy and future financing

Market conditions for fundraising for major mining projects have been generally difficult since 2012 and, in particular, for relatively new mining companies. 2014 saw the price of seaborne iron ore decline by about 50 per cent., to a level from which prices have yet to recover. In addition, due to the Ebola outbreak, West African-based miners have suffered difficult operational conditions and have been hindered in raising finance.

As a result of the fall in iron ore prices and the Ebola outbreak, Bellzone has for the time being been unable to conduct any fundraising from investors other than China Sonangol.

Against this backdrop, China Sonangol has supported Bellzone by injecting new equity funds and working capital loans on four separate occasions totalling approximately US$13 million. The continuing operation of the Company thus far is due to the financial support of China Sonangol.

It is the intention of Bellzone to finance the development of its Kalia project, once the Ebola outbreak is in abeyance and the iron ore price environment improves, such that project finance is available on terms acceptable to the Company. Bellzone's flagship asset remains a strong iron ore development project. The fully independent bankable feasibility study ("BFS") on the first phase of Kalia's proposed production ("Kalia Project 1" or "KP1") led by Fluor Australia Pty Limited and published in September 2013 demonstrated that KP1 is attractive and commercially viable. The Board believes that remains the case, even at today's low iron ore prices, given the alteration in assumptions underlying the BFS as to the fall in both oil prices and shipping costs since publication of the BFS. The amended Loan Facility enables Bellzone to maintain its interests in Guinea whilst conditions improve for the Company to seek longer term loan and/or new equity funds for working capital purposes and for the development of KP1.

As part of a review of the strategy and operations of Bellzone, the Company has been conducting an ongoing reduction of its cost base and further cost-cutting measures have been implemented recently. However, it is expected that during 2015 the Company will seek to raise new equity funds from existing shareholders and new investors to enable the future development of the Company.

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