SNRP.L Regulatory News (SNRP)

Strategic Natural Resources Plc

("SNR" or the "Company")

Funding update

SNR, the AIM listed natural resources developer operating in South Africa, today announces an update in relation to funding for its 74% owned subsidiary Elitheni Coal (Pty) Limited ("Elitheni").

As referenced in previous announcements and in the Report & Accounts of the Company for the financial period ended 30 June 2013, the Company confirms that working capital at Elitheni remains very tight. However, the board of SNR (the "Board") has been informed by the board of Elitheni that it is at an advanced stage of discussions with a number of experienced coal mining parties in South Africa regarding a short term capital injection into Elitheni, by way of debt, which would be potentially convertible into Elitheni shares. Based on the information supplied to them by the board of Elitheni, the Board is highly confident that such discussions will have been concluded successfully by the end of this week. Discussions are also on going regarding a more permanent recapitalisation of the Elitheni business. The entry by Elitheni into such a short term debt facility will be enable Elitheni to satisfy its outstanding and valid current creditors. However, a temporary slowdown of mining operations may be required in any event pending a more permanent capital injection. The Board also understands that both the short and longer term debt facilities currently under discussion will likely be converted into new ordinary shares in Elitheni, resulting in a dilution of the Company's equity interest.

Should the discussions regarding a short term injection of capital into Elitheni not prove to be successful and in the absence of alternative financing being secured in the short term, the board of Elitheni will have to review its options, with a view to maximising the value of the Elitheni assets, which may well include, inter alia, a slowing down of operations at the Elitheni mine until such alternative financing becomes available.

The Board confirms that SNR continues to operate within the limits of its financing facilities and enjoy the full support of its major shareholders.

Gabriel Ruhan, CEO of SNR said "The depressed international coal price has been a real barrier to securing strategic funding in a timely manner but I am encouraged by recent market improvements which are helpful. The Board remains focussed on the strategic value of the mine which represents a very large resource, excellent infrastructure access, the real possibility of a coal fired power station in the Eastern Cape and strong support of both the provincial and national governments of South Africa."

Further announcements will be made in due course, most particularly in relation to the financing arrangements of Elitheni.

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For further information about Strategic Natural Resources plc please visit www.snrplc.co.uk