Bellzone Mining Regulatory News (BZM)

7.00 a.m. - Wednesday 2 March 2011

Bellzone Mining plc

("Bellzone" or the "Company")

Results of Institutional Placing - US$133 million raised

Bellzone Mining plc (AIM: BZM), the iron ore and nickel/copper company operating in West Africa, is pleased to announce the successful completion of the institutional equity placing (the "Institutional Placing") announced yesterday. Due to extremely strong institutional demand, the Company increased the size of the raise from US$100 million to US$133 million. Accordingly, a total of 102,000,000 new Ordinary Shares (the "Institutional Placing Shares") have been placed by Canaccord Genuity Limited ("Canaccord") acting as lead manager and sole bookrunner, and Renaissance Capital Limited ("Renaissance") acting as joint broker in relation to the Institutional Placing at a price of 80 pence per share (a premium of 1.9 per cent. over the closing price on 1 March 2011), raising gross proceeds of £81.6 million (approximately US$133 million).

The Institutional Placing Shares when taken together with the strategic investment of US$100m by China International Fund Limited ("CIF") which was announced yesterday equal, in number, approximately 33.7 per cent. of the Ordinary Shares currently in issue. Individually, the Institutional Placing Shares equal 19.0 per cent. and the CIF Shares equal 14.7 per cent. respectively of the Ordinary Shares currently in issue. 

The Institutional Placing Shares will be issued credited as fully paid and will rank pari passu with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid on or in respect of such shares after the date of issue of the Institutional Placing Shares.

The Institutional Placing is conditional upon, inter alia, Admission and upon the passing of the resolutions at the Company's Extraordinary General Meeting ("EGM") proposed to be convened on or around 21 March 2011. The Institutional Placing is also conditional on the Placing Agreement between the Company and Canaccord Genuity becoming unconditional and not being terminated in accordance with its terms. It is anticipated that the settlement date will be at 8.00 a.m. on or around 22 March 2011. The Company, will shortly publish a circular to shareholders convening the EGM.

Further to the announcement yesterday on the strategic investment of US$100 million by CIF, the Company will apply for the 79,000,000 new Ordinary Shares (the "CIF Subscription Shares") to be admitted to trading on AIM. It is expected that admission to AIM of the CIF Subscription Shares will take place and that trading will commence at 8.00 a.m. on or around 7 March 2011.

Following the admission to AIM of the CIF Subscription Shares, CIF will hold 12.8 per cent. of Bellzone's issued share capital. Following the issue of the Institutional Placing Shares, CIF's holding in Bellzone will be reduced from 12.8 per cent. to 11.0 per cent. 

Following the admission to AIM of the CIF Subscription Shares, the total number of issued Ordinary Shares in Bellzone to which voting rights are attached on the basis of one vote per Ordinary Share held will be 616,124,485. Subject to the admission to AIM of the CIF Subscription Shares the above total voting rights figure may be used by shareholders as the denominator for the calculations by which they will determine whether they are required to notify their interests in, or a change to their interest in, the Company under the FSA's Disclosure and Transparency Rules.

Definitions in the Company's announcement of 4.42 p.m. on 1 March 2011 shall have the same meaning in this announcement unless the context otherwise requires.

Nik Zuks, Chief Executive Officer commented "I am delighted that the support of CIF was more than matched by our institutional shareholders. It is a great endorsement for Bellzone's projects but also for the country of Guinea."

Analyst presentation and teleconference

The management of Bellzone Mining will be holding an analyst presentation today at 10:30 a.m. (London, UK time) at the offices of Tavistock Communications, 131 Finsbury Pavement, London, EC2A 1NT.

A teleconference facility will also be available to dial into the analyst presentation. If you would like to attend the presentation or participate in the conference call, please contact Emily Fenton for details on +44 (0) 207 920 3155 or email efenton@tavistock.co.uk.

Enquiries:

Bellzone Mining plc

Bellzone Mining plc is an exploration and resource development company with iron ore and nickel / copper permits in the Republic of Guinea, West Africa.

The Company's flagship project, the Kalia iron mine, has a JORC resource of 3.74 billion tonnes, located on the Kalia I prospect. Drilling results and internal estimates indicate that Kalia prospect has the potential to host more than 10 billion tonnes of magnetite and 2.55 billion tonnes of potential oxide at surface.

Exploration work continues to further define the potential at Kalia I on both the magnetite and oxide at surface.

Bellzone is committed to the staged development of the Kalia iron project, which includes a 50mtpa iron ore facility, rail and port, with initial production scheduled in 2014. Stage one is planned to bring online 20mtpa direct shipping ore ('DSO') capacity in 2014 and a 10mtpa magnetite concentrator in 2015. Stage two increasing the DSO output to 30mtpa in 2017 and doubling the concentrate capacity to 20mtpa by 2018.

Bellzone signed an Infrastructure Accord with the Republic of Guinea giving the Company exclusive rights to the designated port and rail areas for purposes of conducting studies for the development of the infrastructure leading to the signing of a convention and concession. The infrastructure forms a key part of the Guinea Government's infrastructure strategy and will support the development of iron ore, bauxite and other minerals in Guinea through its availability for third party use.

On 2 August 2010, Bellzone announced signed definitive agreements with China International Fund ('CIF'). CIF will finance and develop the rail and port infrastructure and offer a finance package to Bellzone for the development of the Kalia mine in exchange for the first right to purchase 100% of the off-take of the Kalia mine at market price.

An exploration and development programme is currently underway at the CIF held Forécariah iron permits that lie between 40 and 80kms from the Guinea coast. Bellzone and CIF will jointly develop these permits which are prospective for oxide and magnetite. The oxide has the potential to deliver cash flow from a DSO project in 2012.

Bellzone has completed an intensive mapping and surface sampling programme and has defined highly prospective drilling targets at its Sadeka Nickel/Copper Project and commenced a drilling programme on these targets in Q4 2010.