Europa Metals Regulatory News (EUZ)

11 June 2014

Ferrum Crescent Limited

("Ferrum Crescent", the "Company" or the "Group") (ASX: FCR, AIM: FCR, JSE: FCR)

Independent US$33m Mineral Asset Valuation Report for Moonlight Iron Ore Project

Ferrum Crescent, the ASX, AIM and JSE quoted iron ore developer hereby makes disclosure of an independent valuation report undertaken for the Company by The Mineral Corporation, an independent mineral consultancy based in South Africa.

Highlights

· Ferrum Crescent's mineral assets, comprising the Moonlight Iron Ore Project, valued within a range between US$24.8m and US$41.3m, with a preferred valuation of US$33.0m

· Valuation carried out in compliance with the South African Code for the Reporting of Mineral Asset Valuation (SAMVAL Code)

· Comparative transaction and Enterprise Value comparisons made with peers in conjunction with exploration expenditure

· No value currently ascribed to further exploration potential

· Classed as advanced exploration project (excludes comparisons with operators)

Ferrum Crescent, the ASX, AIM and JSE quoted iron ore developer, today makes disclosure of the independent valuation report commissioned on the mineral assets of the Company, carried out for the purposes of obtaining the approval of the South African Reserve Bank for the approval of the issue of shares by Ferrum Iron Ore (Pty) Ltd (FIO) to Anvwar Asian Investment (AAI). FIO is the South African Group company that holds the Moonlight Iron Ore Project.

The Mineral Corporation's independent valuation of the Moonlight Iron Ore Project in South Africa (Moonlight or the Project) placed a value to the Project within a range from S$24.8m to US$41.3m, with a preferred value of US$33m. The valuation of the Project used the principles and guidelines of the South African Code for the Reporting of Mineral Asset Valuation (SAMVAL Code).

As Ferrum Crescent considers that it is important for shareholders and investors to read the report in its entirety, a copy of the report has been posted on the Company's website. Additionally, Ferrum Crescent has set out below highlights from the report from The Mineral Corporation.

In addition, the Company notes recent press speculation regarding its financing of Moonlight. As announced on 30 May 2014, the Company is in discussions with AAI and other parties around providing financing options to fund the bankable feasibility study on Moonlight. These discussions remain ongoing, and the Company will update the market in due course.

Introduction

The scope of work determined by Ferrum Crescent required the undertaking of a Mineral Asset Valuation of the Moonlight Project using the principles and guidelines of the SAMVAL Code.

The valuation opinion contained in the report is only for the Mineral Assets of the Company, and excludes the value of any surface infrastructure established at the Moonlight Project, any movable assets which are part of the Project or the balance sheet circumstances of Ferrum Crescent. The effective date of the valuation is 30 April 2014.

All opinions, findings and conclusions expressed in the report are those of The Mineral Corporation and are based on information provided by Ferrum Crescent. These opinions, findings and conclusions can change significantly with new information. Accordingly, the opinions, findings and conclusions contained in the report may also be subject to change.

The report excludes all aspects of legal issues, commercial and financial matters, land titles, agreements, excepting where such aspects may directly influence Mineral Resources and Mineral Asset Valuation of the Moonlight Project.

It is to be noted, however, that mineral projects are inherently risky assets and therefore unknown risks and uncertainties have the potential to materially impact on the future valuations of the Mineral Assets. At this stage, The Mineral Corporation is not aware of any material risks to the Mineral Assets of the Moonlight Project that may impede further development of these assets.

Description of the Mineral Assets

The Moonlight Project is an advanced exploration project for which it is understood that a Feasibility Study is planned. The Moonlight Project comprises three adjacent properties, namely Moonlight 111 LR, Julietta 112 LR and Gouda Fontein 76 LR, which are covered by a valid Mining Right.

The latest Mineral Resource update for the Moonlight Project was compiled by The Mineral Corporation in April 2014. The Mineral Resources are stated in terms of the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code (2012)), and are summarised in the table below. The Mineral Resources were reported using a cut-off grade of 16% Fe, geological losses of 5% and a depth constraint from surface to between 100m and 250m.

The valuation opinion contained in the report has been estimated on a 100% ownership basis. Furthermore, Inferred Mineral Resources form some part of the basis for this valuation. There is a low level of geological confidence associated with the Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of additional Indicated or Measured Mineral Resources.

The Project has a well developed concept in place: Ferrum Crescent plans to mine and beneficiate at Moonlight and then pump the magnetite concentrate slurry by pipeline to a manufacturing facility near a railhead at Thabazimbi in Limpopo Province where it is planned to manufacture direct reduction and blast furnace grade pellets. It is anticipated that the exported product will be railed from Thabazimbi to the port of Richards Bay. Ferrum Crescent has an offtake agreement in place with Swiss-based Duferco SA, and it is expected that its direct reduction grade product will find a market with customers using electric arc furnaces to produce steel. It is understood that Ferrum Crescent is shortly to commence with a phased Feasibility Study on this basis.

Valuation Methodology

The SAMVAL Code requires the consideration of two different approaches to the valuation of a mineral asset. As the Project is at an advanced exploration stage, The Mineral Corporation considers that the cash flow valuation approach is not appropriate. The Mineral Corporation does consider the market approach to be appropriate for the stage of project development, and has elected to apply two methods thereof. In addition, the cost approach has also been applied and used to corroborate the market approach. Furthermore the SAMVAL Code precludes the application of certain logic in valuation, such as 'gross in-situ-value' simply determined from the product of the estimate of mineral content and commodity prices(s).

The Market Approach relies on the principle of 'willing buyer - willing seller' and requires that the amount obtainable from the sale of Mineral Asset is determined as if in an arms-length transaction. The Market Approach is often applied to Exploration Properties.

The Mineral Corporation does consider the Market Approach to be appropriate for the current stage of project development, and has elected to apply two methods thereof. These included a comparative transaction approach based on magnetite project transactions which have traded on a 'willing buyer-willing seller' basis and secondly, a comparative Enterprise Value which considers the (debt and cash adjusted) market capitalization-derived valuation of listed companies which own magnetite projects.

These two Market Approach methods derive their value from the price paid by the market for the mineral assets being valued. Exploration Properties by definition have a Mineral Resource estimate as their only asset, and as these Mineral Resource estimates vary in size, it is necessary to normalise the price paid by the market, by the size of the Mineral Resource. A Market Approach which is normalised for the size of the Mineral Resource does not therefore constitute an 'in situ valuation'.

The Cost Approach relies on historical and/or future amounts spent on the Mineral Asset and is quite widely used for Exploration Properties. The Competent Valuator has applied the Cost Approach as a third method to corroborate the Market Approaches applied.

The Market and Cost Approaches applied are the two generally accepted approaches to Mineral Asset Valuation appropriate for projects at this stage of development.

Method 1: Market approach - comparable transactions

The Mineral Corporation holds a database of transaction information from transactions involving magnetite projects or mines since 2005. The price paid per contained Fe tonne (US$/Fe-t) in each transaction has been derived. These prices have been grouped by development category, from Inferred Mineral Resources to Operations.

The Mineral Corporation estimated a transaction price for the Moonlight Project of between 0.30 and 0.90 US$/Fe-t, after normalising for the Projects' development stage, and the iron ore price.

Method 2: Market approach - Comparable Enterprise Value per tonne

The Mineral Corporation considered the value of 12 comparable listed magnetite mining and exploration companies and estimated an Enterprise Value calculated for each from publically available documents. As an advanced exploration project, Moonlight should be compared with other similar projects, rather than operations. The Mineral Corporation considers Ferrum Crescent's "peers" in this regards to have an Enterprise Value per contained Fe tonne of between 0.10 and 0.50 US$/Fe-t

Method 3: Cost approach - historical exploration cost

The Mineral Corporation estimates the total relevant historical exploration expenditure on the Project to be US$22.4m, including US$21.4m by Ferrum Crescent and an estimated US$1.0m by the previous owner's Iscor.

Valuation opinion

The Mineral Corporation's view is that the EV per contained Fe tonne method is probably more cognisant of the current market conditions for publically listed exploration companies than the comparable transactions method. On this basis, The Mineral Corporation valuation range would be between US$25m and US$41m, with a preferred valuation of US$33m, as at 30 April 2014.

The Mineral Corporation / Competent Person's Consent

This information in this statement that relates to Mineral Asset Valuation has been compiled by Stewart Nupen and the Mineral Asset Valuation is signed off according to the 2008 Edition of the South African Code for the Reporting of Mineral Asset Valuation (SAMVAL Code). Mr Nupen is a Fellow of the Geological Society of South Africa, a registered Natural Professional Scientist and has the necessary qualifications, ability and relevant experience to act as a Competent Valuator. The valuation has been peer reviewed by Mr John Murphy. Both Mr Nupen and Mr Murphy are directors of The Mineral Corporation. The Mineral Corporation operates as an independent technical adviser and consultant, providing Mineral Resource evaluation, mining engineering, mineral processing and mine valuation services to the mining industry. The Mineral Corporation has received, and will receive, professional fees for its preparation of this report. However, neither The Mineral Corporation nor any of its directors or staff who contributed to this valuation has any interest in the Mineral Assets reviewed.

The information in this statement that relates to Exploration Targets, Exploration Results and Mineral Resources has been compiled by Stewart Nupen, a Competent Person who is a Fellow of the Geological Society of South Africa and a registered Professional Natural Scientist with the South African Council for Natural Scientific Professionals. Stewart Nupen is employed by The Mineral Corporation, an independent consulting firm to Ferrum Crescent Limited.

Stewart Nupen has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Stewart Nupen consents to the inclusion in this statement of the matters based on his information in the form and context in which it appears.

For more information, please visit www.ferrumcrescent.comor contact: