Woodbois Regulatory News (WBI)

2 December 2015

Obtala Resources Limited

("Obtala", the "Group" or the "Company")

(AIM: OBT)

Timber Update

The Board of Obtala notes and welcomes the recent statement from the Mozambican Government, which has approved a decree suspending for the next two years the authorization of any new request for logging areas under the regime of "simple licences". The measure is intended to safeguard the country's forests, which have come under intense pressure from logging, to such an extent that the survival of some plant species is threatened.

Under Mozambican law, there are two forms of forestry exploitation licences. One is the "simple licence" under which the operators cut down the trees, and are not obliged to process any of the timber. The second is the "forestry concession contract", which involves larger areas, and under which the companies concerned operate within strict permitted cut allowances and are obliged to process timber inside Mozambique. The government suspension does not affect the concession contracts currently held by the Company as all of the timber rights are held under the "forestry concession contract".

The Company continues with the previously stated intent to maximise value of the timber assets through a process of re-structuring.

Kevin Milne, Executive Deputy Chairman of Obtala, commented, "We have received a number of shareholder enquires regarding this subject and welcome the opportunity to clarify the position. We applaud the Government of Mozambique in taking this very sensible measure to ensure the protection of the forests and safe-guarding the long term security of the timber sector within the country. We continue to operate in a responsible, sustainable manner in accordance with the strict conditions of our forestry concession contracts and laws of Mozambique and look forward to growing this exciting business opportunity. The process of re-structuring the timber business is on-going and once completed will allow the timber business to continue creating employment and economic growth within the regions where we operate"