Zanaga Iron Ore Company Audited Results for the Year to 31 December 2023

1 July 2024

2023 Highlights and post reporting period end events to 30 June 2024

Zanaga Iron Ore Project (the "Project" or the "Zanaga Project")

·   30Mtpa staged development project ("30Mtpa Project")

o 2024 Feasibility Study update process ("2024 FS update") completed, delivering positive results and further underlining the robust economics of the Company's 30 Mtpa Project (including both 12Mtpa Stage One ("Stage One"), plus 18Mtpa Stage Two expansion ("Stage Two")).

§ 12Mtpa Stage One

-      Capital investment of US$ 1.94 billlion

-      Operating cost of US$ 31.5 / dmt FOB

-      Net Present Value of US$ 3.68 billion

-      Internal Rate of Return of 26.2%

§ 18Mtpa Stage Two optional expansion

-      Capital investment of US$ 1.87 billion

-      Operating cost of US$ 24.9 / dmt FOB

-      Total combined Net Present Value of US$ 7.36 billion

-      Internal Rate of Return of 28.2%

o Chinese iron ore technical expert engineering firm ("Chinese EPC Partner"), engaged to lead the 2024 FS update process, now undertaking an optimisation study on the applicability of unique technology relating to the Zanaga 30Mtpa Project ("Optimisation Study") with the potential to provide further capital and operating cost savings beyond the results of the 2024 FS Update.

o FEED phase preparation

§ Preparation for the Front End Engineering and Design (FEED) phase of the Zanaga Project is underway, including solicitation of cost and schedule estimates for the various workstreams associated with the FEED phase.

o Other strategic initiatives

§ Hydro power MoU signed with China Machinery Engineering Corporation ("CMEC") relating to hydroelectric power solutions for the Zanaga Project and associated funding of such power projects (announced on 29 December 2023)

§ Port MoU: Discussions underway with large scale port development companies interested in participating in the development of port infrastructure for the Zanaga Project.

§ Strategic partner initiative: Approaches recevied from multiple parties interested in the development of the Zanaga Project, particularly following the completion of the 2024 FS update. Discussions continue and the Company will provide further updates in due course.

·   Early Production Project ("EPP Project" or "EPP") remains under investigation

o Multiple production scenarios remain under investigation on processing facilities and suitable logistics solutions, with a focus on an export solution through the Republic of Congo ("RoC").

Corporate

·   Loan funding agreement

o  To fund the Project's continuing work programme and budget, as well as the working capital requirements of ZIOC, Glencore Projects entered into a loan facility (the "Loan Facility") with Jumelles Ltd in June 2022, providing up to US$1.8 million of loan capital.

§ Loan repayable by 31 July 2024

§ As at 29 June 2024, following a number of repayment instalments, ZIOC had outstanding US$744k of the Loan Facility including accrued interest

·   Shard Merchant Capital Ltd ("SMC") equity subscription agreements ("Shard ESAs")

o  Second SMC equity subscription agreement (ESA) update ("2023 ESA")

§ Net proceeds of £1,667,755 (US$2,124,527) received from the facility to date, following the placement by SMC of the first two tranches of shares (a combined total of 24 million shares)

§ On 28 June 2024, SMC subscribed for 12 million shares of no par value in ZIOC, as part of the final third tranche of the 2023 ESA

o  New ESA signed with SMC on 29 June 2024 ("2024 ESA")

§ Following the successful completion of the 2023 ESA, ZIOC has entered into the 2024 ESA with SMC

§ Under the terms of the 2024 ESA the Company will issue and SMC will subscribe for up to 36 million ordinary shares of no par value in the Company ("Subscription Shares") in up to three tranches of up to 12 million shares each.

§ Pursuant to the 2024 ESA, SMC has undertaken to use its reasonable endeavours to place the relevant Subscription Shares that it has subscribed for and to pay to ZIOC 95% of the gross proceeds of any such sales.

o  Proceeds of the Shard ESAs applied to general working capital, including the provision of further contributions to the Zanaga Project's operations

·   Appointment of Mr Martin Knauth at Chief Executive Officer

o Senior mining executive with extensive experience in the industry spanning more than 30 years in a wide range of cultures, countries and commodities, with notable success in project development, operations and transformational growth phases

·   Appointment of Shard Capital Partners LLP as joint Corporate Broker

·   Cash balance of US$0.9m as at 31 December 2023 and a cash balance of US$0.1m as at 28 June 2024

Clifford Elphick, Non-Executive Chairman of ZIOC, commented:

"I am pleased to report that ZIOC has progressed through another critical milestone, delivering on expectations in completing the updated cost estimates of the 30Mtpa Feasibility Study with its Chinese EPC Contractor partner, while also advancing our understanding of the application of new iron ore processing technology to reduce estimated costs further. Following the streamlining of ownership and control of the Zanaga Project in 2022, the updated FS now enables ZIOC to engage with new strategic entities interested in participating in the Zanaga Project going forward."

The Company will post its Annual Report and Accounts for the year ended 31 December 2023 ("2023 Annual Report and Accounts") to shareholders on approximately 10 July 2024.

The 2023 Annual Report and Accounts will be available on the Company's website www.zanagairon.com today.

For further information, please contact:

Zanaga Iron Ore

Corporate Development and                         Andrew Trahar

Investor Relations Manager                           +44 20 7399 1105

Panmure Liberum Capital Limited

Nominated Adviser, Financial                        Scott Mathieson, John More

Adviser and Corporate Broker                       +44 20 3100 2000

Shard Capital Partners LLP

Corporate Broker                                                Damon Heath

                                                                              +44 207 186 9952

About us:

Zanaga Iron Ore Company Limited (AIM ticker: ZIOC) is an iron ore exploration and development company, with the Company's flagship asset being its 100% owned Zanaga Iron Ore Project located in the Republic of Congo, for which the Government Mining Licence, Environmental Permit and Mining Convention are all in place.

Chairman's Statement

Dear Shareholder,

Following the acquisition of the controlling shareholding in the Zanaga Project in December 2022, we continue to progress in-country activities with the intention of re-energising the 12Mtpa Stage One project following completion of the 2024 FS update process. Iron ore prices have maintained robust levels for a substantial period of time and high quality iron ore projects like the Zanaga Project are now well positioned for development.

Iron Ore Market

The iron ore market has demonstrated continued robust demand and pricing has remained stable in recent months. China continues to consume significant quantities of iron ore to feed its substantial steel industry and intitiatives to produce lower carbon emission 'green steel' provide furher support for premium pricing related to high grade iron ore products. This provides further impetus for the development of high grade iron ore projects such as the Zanaga Project.

2024 FS update process

In 2023 the Company partnered with a Chinese iron ore technical expert engineering firm ("Chinese EPC Partner") as part of a process to update the economic evaluation of the Zanaga 30 Mtpa staged development project.

Using the 2014 Feasibility Study's ("2014 FS") infrastructure designs, flowsheets and material take off lists, direct and indirect cost estimates were updated to current market pricing using Chinese major equipment and contractor pricing for both phases of 12 Mtpa Stage One haematite ("Stage One"), plus 18 Mtpa Stage Two magnetite expansion ("Stage Two") projects, inclusive of buried concentrate pipeline and port infrastructure.

A second phase of optimisation work ("Optimisation Study") is under consideration and involves investigating the potential to apply proprietary iron ore processing technology that the Chinese EPC Partner possesses, with the potential to provide further capital and operating cost savings beyond the results of the 2024 FS Update.

The 2024 FS update was completed to a (+/- 20% accuracy) full feasibility study level of definition, with the following positive results:

§ 12Mtpa Stage One

-      Capital investment of US$ 1.94 billlion

-      Operating cost of US$ 31.5 / dmt FOB

-      Net Present Value of US$ 3.68 billion

-      Internal Rate of Return of 26.2%

§ 18Mtpa Stage Two optional expansion

-      Capital investment of US$ 1.87 billion

-      Operating cost of US$ 24.9 / dmt FOB

-      Total combined Net Present Value of US$ 7.36 billion

-      Internal Rate of Return of 28.2%

The Company believes these positive results provide much greater confidence in the Project's economic feasibility in today's market and cost environment, and with this, provides a key catalyst for potential strategic investors to consider funding of the next logical Project phase, being the front end engineering and design (FEED) program to further define the Project's physical elements and risk abatement strategies.

EPP Project

Whilst ZIOC's focus during 2023 was on advancing the 2024 FS update process, the Project Team continued to undertake a process to evaluate the potential development of an EPP Project that would be quicker to construct than the larger 30Mtpa staged development project and would utilise existing road, rail and port infrastructure.

The Project Team continued to advance efforts to develop optionality relating to the viability of the EPP Project. The Project Team has continued to evaluate the potential for the EPP Project to operate as a standalone project, or as an initial pathway to production during the construction period of the flagship 30Mtpa Staged Development Project.

Cash Reserves and Project Funding

At 31 December 2023 the Company had cash reserves of US$0.9m. As at 29 June 2024, ZIOC has outlined a 2024 Project Work Programme and Budget as outlined below. The Company had cash reserves of US$0.1m as at 28 June 2024.

In order to raise additional funding the Company entered a Subscription Agreement with SMC (as described above - see the Company's release of 28 June 2024.) The financing structure with SMC enables the Company to access funding for the costs that the Company is expected to meet in the near future. For illustrative purposes only, if the average price at which SMC places the final tranche of the 2023 ESA and all three tranches of the 2024 ESA (a combined total of 48,000,000 shares) was 7 pence, the net proceeds received by ZIOC from such sales would be approximately £3.19m. Based on the current cost base at the Zanaga Project, the direct loan facility to Jumelles Ltd, the current low corporate overheads of ZIOC, the agreed cash preservation plan adopted by the Company (described below), the Company's existing cash reserves and (on the basis of cautious assumptions made by the Company in its funding model) the funds expected to be obtained from the funding facility established by the Subscription Agreement with SMC, the board of directors of ZIOC (the "Board") believes that the Company will be adequately positioned to support its operations going forward in the near future. As the final cash amounts to be received for each tranche of issued shares, and the timing of this receipt, are dependent on SMC successfully selling the shares prior to transferring funds to the Company, the Board is of the view that the going concern basis of accounting is appropriate. However, the Board acknowledges that there is a material uncertainty which could give rise to significant doubt over the Company's ability to continue as a going concern and, therefore, that the Company may be unable to realise its assets and discharge its liabilities in the normal course of business. Nevertheless, based on and taking into account the foregoing factors, the Board are satisfied the Company will have sufficient funds to meet its own working capital requirements up to, and beyond, twelve months from the approval of these accounts.

The Company continues to review the costs of its operational activities with a view to conserving its cash resources. As part of such review, and in order to preserve the cash position of the Company, it has been agreed with the Directors  since January 2023 that fees previously deferred would be reviewed.

Subscription Agreement with Shard Merchant Capital Ltd

The Company has been pleased with the success of the 2023 ESA with SMC which has provided the Company with access to funding through a relatively low cost structure that minimised dilution to shareholders.

The proceeds received by the Company from SMC pursuant to the Subscription Agreement have been applied to general working capital, including the provision of further contributions to the Zanaga Project's operations.

As a result the Company has entered into a new 2024 ESA with SMC. An overview of the two ESAs is provided below:

1)    2023 ESA

a.    On 1 July 2023 ZIOC announced that the Company had entered into a Subscription Agreement with SMC, a financial services provider.

b.    Under the Subscription Agreement, the Company agreed to issue and SMC agreed to subscribe for up to 36 million ordinary shares of no par value in the Company ("Subscription Shares") in three tranches of 12 million shares each

c.     Net proceeds of £1,667,755 (US$2,124,527) have been received from the facility to date, following the placement by SMC of the first two tranches of shares (a combined total of 24 million shares)

d.    On 29 June 2024, SMC subscribed for 12 million shares of no par value in ZIOC, as part of the final third tranche of the 2023 ESA

2)    2024 ESA

a.   The Company entered into a new Subscription Agreement (the 2024 ESA) with SMC on 29 June 2024.

b.    Under the Subscription Agreement, the Company will issue and SMC has subscribed for 36 million ordinary shares of no par value in the Company ("Subscription Shares") in three tranches of 12 million shares each (First tranche to be issued immediately).

Chief Executive Officer appointment

On 14 December 2023, ZIOC appointed Mr Martin Knauth as Chief Executive Officer. Mr Knauth is a senior mining executive with extensive experience in the industry spanning more than 30 years in a wide range of cultures, countries and commodities, with notable success in project development, operations and transformational growth phases, as well as establishment of performance cultures. With previous experience in Australia, Kazakhstan, Madagascar, Cuba, the DRC and many other jurisdictions, working for such companies as Western Mining Corp, Vale, Sherritt Metals International, KAZ Minerals and Glencore. He has a strong record in establishing and maintaining positive relationships with governments, communities, employees and other Project stakeholders critical to the Company's success.

Mr Knauth holds a Bachelor's degree in Mining Engineering from the University of Queensland, a Masters degree in Mineral Economics from Curtin University and is a Member of the AusIMM.

Mr Knauth brings extensive experience in project development, operations and transformational growth phases in the mining industry. These positive attributes are essential to moving the Zanaga Project forward, especially in light of the recently announced strategic objectives of the Company.

Appointment of joint Corporate Broker

In March 2024 ZIOC appointed Shard Capital Partners LLP ("SCP") as joint Corporate Broker, alongside Panmure Liberum Capital Limited, who are also the Company's Nominated Advisor. The addition of  SCP to our advisory team provides further support to ZIOC, and additional resources as the Company looks to advance to the next stage of development on the Zanaga Project.

Outlook

Following the completion of the 2024 FS Update, and with ZIOC now positioned as 100% owner of the Zanaga Project, we are now able to engage with strategic entities interested in partnering on the Zanaga Project going forward. It is pleasing to have secured the support of Glencore throughout the process of delivering the 2024 FS Update and we look forward to working with the Glencore team in unlocking value from the project for all stakeholders.

Despite globally uncertainty, the Project Team have continued to progress numerous workstreams with the potential to add significant value to the options available for the development of the Zanaga Project.

Our investigations of opportunities that have the potential to unlock existing infrastructure solutions, as well as options available for lowering capital and operating costs of the project have been a key focus of the team, and we hope to provide an update on these intitiatives in due course.

Clifford Elphick

Non-Executive Chairman

Business Review

The Zanaga Project remains a unique large scale tier one asset with multiple potential development options from a scale perspective.

The Project Team have dedicated significant effort to securing updated development costs associated with the flagship 30Mtpa project, and are pleased with the results of the 2024 FS Update, bringing the cost estimates of the 30Mtpa Zanaga Project in line with current market pricing. ZIOC's Chinese EPC Partner, who led the 2024 FS update process, also posseses substantial technical capabilities in iron ore process plant design and engineering, as well as unique technology expertise in iron ore process. The Optimisation Study underway has the potential to further enhance the value of the Project and we look forward to advancing this work going forward.

30Mtpa Staged Development Project

The Project Team's ultimate objective remains to develop the flagship 30Mtpa staged development mining project. As a reminder, the Stage One project plans to produce 12Mtpa of premium quality 66% Fe content iron ore pellet feed product at bottom quartile operating costs for more than 30 years on a standalone basis.

The Stage Two expansion of 18Mtpa is nominally scheduled to suit the project mine development, construction timing and forecast cash flow generation, and would increase the Project's total production capacity to 30Mtpa. The product grade would increase to an even higher premium quality 67.5% Fe content due to the addition of 18Mtpa of 68.5% Fe content iron ore pellet feed production, at an even lower operating cost. The capital expenditure for the additional 18Mtpa production, including contingency, could potentially be financed from the cash flows from the Stage One phase.

The Zanaga Project Team has continually taken steps to monitor evolving improvements into its strategy for assessing the options available for the development of the Zanaga Project. The Project Team maintained its view that high quality products will continue to achieve significant price premiums in the future and has sought to lock in this additional revenue benefit into the Project's development plan.

The Project Team will continue to engage in activity to ascertain opportunities for optimisation and improvement of the 30Mtpa staged development project and will update the market as these improvements develop.

2024 FS update study results

In 2023 the Company's Chinese EPC Partner led a process to update the economic evaluation of the Zanaga 30 Mtpa staged development project. Using the 2014 FS infrastructure designs, flowsheets and material take off lists, direct and indirect cost estimates were updated to current market pricing using Chinese major equipment and contractor pricing for both Stage One and Stage Two of the Zanaga Project, inclusive of buried concentrate pipeline and port infrastructure.

The Optimisation Study is under consideration and involves investigating the potential to apply proprietary iron ore processing technology that the Chinese EPC Partner possesses, with the potential to provide further capital and operating cost savings beyond the results of the 2024 FS Update.

2024 FS update results

Note: Iron ore prices based on AME Group's long term real iron ore price forecast for 65% Fe IODEX. Operating costs exclude royalties payable.

These results compare favourably against the previous 2014 FS capital and operating costs estimates, as outlined below;

Since 2014, the Company has conducted a number of technical and economic review exercises using third party western technical consulting firms, which resulted in high level estimations of the costs to develop the project at that time, but only to a Preliminary Economic Assessment (PEA) or Pre-Feasibility Study (PFS) level of definition. The 2024 FS update was concluded to a higher degree (+/- 20% accuracy) full feasibility study level of definition. In addition, the results provided by ZIOC's Chinese EPC Partner were independently reviewed and validated by a third-party technical consulting firm.

The Company believes these positive results provide much greater confidence in the Project's economic feasibility in today's market and cost environment, and with this, provides a key catalyst for potential strategic investors to consider funding of the next logical Project phase, being the front end engineering and design (FEED) program to further define the Project's physical elements and risk abatement strategies.

Corporate initiatives update

In September 2023, the Company outlined its strategic objectives, including the intention to secure MoUs with a number of potential partners to progress the Zanaga Iron Ore Project. An update on each MoU workstream is provided below:

1)    Hydro power MoU

a)    In December 2023, following CMEC's preliminary inspections and engineering of potential hydroelectric sites near the Zanaga Project, a memorandum of understanding ("MoU") was signed with China Machinery Engineering Corporation ("CMEC") relating to hydroelectric power solutions for the Zanaga Project and associated funding of such power projects. The following objectives were agreed:

i)     Advance engineering and related studies for the identified hydroelectric sites near the Zanaga Project.

ii)    Draft arrangements for the funding of development and operation of the identified hydroelectric project(s), between the government of the Republic of Congo and third Parties.

2)    Port MoU

a)    Port infrastructure discussions are underway with a large port infrastructure development firm seeking to expand the existing port of Pointe-Noire. Consideration is also being given to potential development solutions for a large bulk mineral port capable of supporting the 30Mtpa staged development project.

3)    Strategic partner initiative

a)    Following the completion of the acquisition of Glencore's shareholding in the Zanaga Project in December 2022, and with the benefit of the 2024 FS udpate process results, a number of potential strategic partners have approached ZIOC with an interest in participating in the development of the Zanaga Project. Discussions continue and the Company will provide further updates in due course.

Next Steps

Throughout the remainder of 2024, the Project Team will focus on engaging with our selected Chinese EPC partner to investigate applicability of new iron ore processing technology to the Zanaga Project, while continuing to investigate potential opportunities for smaller scale production utilising existing infrastructure, supporting the initiative to secure strategic partners interested in the development of the Project.

Financial Review

Results from operations

The financial statements contain the results for the Group's twelfth full year of operations following its incorporation on 19 November 2009. The Group made a total comprehensive loss in the year of US$3.6m (2022: total comprehensive income US$4.7m). The total comprehensive income for the year comprised:

General expenses of US$2.7m (2022: US$0.5m) consists of Administration expenditure in Congo of US$1.0m, director fees US$0.4m (2022: Nil), technical fees US$0.8m (2022: Nil) long Term Incentivisation Plan ("LTIP") Nil (2022 US$0.2m) and US$0.5m (2022: US$0.3m) of other general operating expenses.

Financial Position

ZIOC's Net Asset Value ("NAV") of US$85.2m (2022: US$85.2m) comprises of US$nil (2021: US$37.3m) investment in Jumelles, US$85.3m of exploration and evaluation assets.US$0.7m of PPE, US$0.9m (2022: US$0.3m) of cash balances and US$1.0m (2022: US$1.1m) of other net current liabilities.

Subscription Agreement concluded with Shard Merchant Capital Ltd

As outlined in the Chairman's Statement above, on 1 July 2023 ZIOC entered into a 2023 ESA with SMC, a financial services provider. Under the terms of the agreement the Company will issue and SMC will subscribe for up to 36 million ordinary shares of no par value in the Company in up to three tranches of up to 12 million shares each.

Pursuant to the 2023 ESA, SMC has undertaken to use its reasonable endeavours to place the relevant Subscription Shares that it has subscribed for and to pay to ZIOC 95% of the gross proceeds of any such sales.

Cash flow

Cash balances increased by US$0.58m during 2023 (2022: decrease of US$0.08m). Operating activities utilised US$1.4m (2022: US$0.5m). The Company raised funds of US$1m from the Shard facility during the year and $1.3m was drawndown from the Glencore loan facilty

Fundraising activities

The fundraising activities carried out in 2023 of US$1m (2022: US$0.2m) those relating to the SMC facility which are described earlier in this announcement.

Reserves & Resource Statement

The Zanaga Project has defined a 6.9bn tonne Mineral Resource and a 2.1bn tonne Ore Reserve, reported in accordance with the JORC Code (2012) unaudited by MHA, and defined from only 25km of the 47km strike length of the orebody so far identified.

Ore Reserve Statement

The Ore Reserve estimate (announced by the Company on 5 May 2021) was prepared by independent consultants, SRK Consulting (UK) Ltd ("SRK") and is based on the 30Mtpa Feasibility Study and the 6,900Mt Mineral Resource (announced by the Company on 8 May 2014).

As stipulated by the JORC Code, Proven and Probable Ore Reserves are of sufficient quality to serve as the basis for a decision on the development of the deposit. Based on the studies performed, the mine plan as reported in the 2014 FS was reassessed in respect of the updated sales revenue, operating expenditure and capital expenditures and confirmed as at 31 December 2020 to be technically feasible and economically viable.

Notes:

Long term price assumptions are based on a CFR IODEX 65%Fe forecast of US$90tdry (USc138/dmtu) with adjustments for quality, deleterious elements, moisture and freight.

Discount Rate 10% applied on an ungeared 100% equity basis

Mining dilution ranging between 5% and 6%

Mining losses ranging between 1% and 5%

Note: The full Ore Reserve Statement is available on the Company's website (www.zanagairon.com)

Mineral Resource

Reported at a 0% Fe cut-off grade within an optimised Whittle shell representing a metal price of 130 USc/dmtu. Mineral Resources are inclusive of Reserves. A revised Mineral Resource, prepared in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code, 2012 Edition) was announced on 8 May 2014 and is available on the Company's website (www.zanagairon.com).

Note: The figures shown are rounded; they may not sum to the subtotals shown due to the rounding used.

The Mineral Resource was estimated as a block model within constraining wireframes based upon logged geological boundaries. Tonnages and grades have been rounded to reflect appropriate confidence levels and for this reason may not sum to totals stated.

Geological Summary

The Zanaga iron ore deposit is located within a North-South oriented (metamorphic) Precambrian greenstone belt in the eastern part of the Chaillu Massif in South Western Congo. From airborne geophysical survey work, and morphologically, the mineralised trend constitutes a complex elongation in the North-South direction, of about 47 km length and 0.5 to 3 km width.

The ferruginous beds are part of a metamorphosed, volcano-sedimentary Itabirite/banded iron formation ("BIF") and are inter-bedded with amphibolites and mafic schists. It exhibits faulted and sheared contacts with the crystalline basement. As a result of prolonged tropical weathering the BIF has developed a distinctive supergene iron enrichment profile.

At surface there is sometimes present a high grade ore (+60% Fe), classified as canga, of apparently limited thickness (<5m) capping a discontinuous, soft, high grade, iron supergene zone of structure-less hematite/goethite of limited thickness (<7m). The base of the high-grade supergene iron zone grades quickly at depth into a relatively thick, leached, well-weathered to moderately weathered friable hematite Itabirite with an average thickness of approximately 25 metres and grading 45-55% Fe.

The base of the friable Itabirite zone appears to correlate with the moderately weathered/weakly weathered BIF boundary, and fresh BIF comprises bands of chert and magnetite/grunerite layers.

Competent Persons

The statement in this announcement relating to Ore Reserves is based on information compiled by Dr Iestyn Humphreys, FIMM, AIME, PhD who is a Corporate Consultant, and Practice Leader with SRK. He has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the JORC Code (2012). The Competent Person, Dr Iestyn Humphreys, confirms that the Ore Reserve Estimate is accurately reproduced in this announcement and has given his consent to the inclusion in the report of the matters based on his information in the form and context within which it appears.

The information in this announcement that relates to Mineral Resources is based on information compiled by Malcolm Titley, BSc MAusIMM MAIG, of CSA Global (UK) Ltd. Malcolm Titley takes overall responsibility for the report as Competent Person. He is a Member of the Australasian Institute of Mining and Metallurgy ("AUSIMM") and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a Competent Person in terms of the JORC Code. The Competent Person, Mr Malcolm Titley, has reviewed this Mineral Resource statement and given his permission for the publication of this information in the form and context within which it appears.

Definition of JORC Code

The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (2012) as published by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia.

Principal Risks & Uncertainties

The principal business of ZIOC currently comprises managing ZIOC's interest in the Zanaga Project, including the Jumelles group, and monitoring the development of the Project and engaging in discussions with potential investors. The principal risks facing ZIOC are set out below. Risk assessment and evaluation is an essential part of the Group's planning and an important aspect of the Group's internal control system. Overall these potential risks have remained broadly constant over the past year with the exception of the implications of COVID-19 on the long term outlook for the iron ore market.

Risks relating to iron ore prices, markets and products

The ability to raise finance for the Project is largely dependent on movements in the price of iron ore. Iron ore prices have historically been volatile and are primarily affected by the demand for and price of steel and the level of supply of iron ore. Such prices are also affected by numerous other factors beyond the Company's and the Jumelles group's control, including the relative exchange rate of the U.S. dollar with other major currencies, global and regional demand, political and economic conditions, production levels and costs and transportation costs in major iron ore producing regions.

While it appears to be the case that there has been some degree of stabilisation of iron ore prices in the global market for iron ore, the duration of such stabilisation remains uncertain. The level of iron ore prices in the global market for iron ore continues to be subject to uncertainty. Although the 2014 FS identifies the product from the Project and the potential demand for such product within a range of iron ore prices, there are no assurances that the demand for the Project's product will be sufficient in quantity or in price to ensure the economic viability of the Project or to enable finance for the development of the Project to be raised. Furthermore, the range of iron ore prices in the 2014 FS will need to be reviewed so as to reflect changed market conditions and changed expectations relating to the supply and demand for iron ore. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to an EPP

For some considerable period, an initiative has been and is being carried out to investigate the possibility of a low-cost small scale start-up, using existing infrastructure, focussing on a standard 62% Fe benchmark iron ore product or a high grade 65% Fe pellet feed iron ore product that would involve simple 'processing' applications. In conjunction with this, the possibility of a low-cost small scale start-up involving the production of a pellet feed concentrate and conventional pelletisation continues to be investigated. This initiative also involves the assessment of methods of providing the necessary power requirements as well as logistical support to enable the product to be transported to an available exit port. There will also be the need to put in place the appropriate contractual and permitting arrangements. There is a risk that such kind of start-up is found not to be viable or is not proceeded with for other reasons or is delayed. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to financing the Zanaga Project

Any decision of the Company to proceed with construction of the mine and related infrastructure (or any variant such as a low capital cost, small scale start-up EPP Project) is itself dependent upon the ability of the Company to raise the necessary debt and equity to finance such construction and the initial operation of the mine (or any variant such as a low-cost small scale start-up). The Company may be unable to obtain debt and/or equity financing in the amounts required, in a timely manner, on favourable terms or at all and should this occur, it is highly likely to pose challenges to the proposed development of the Zanaga Project and the proposed timeline for its development. Moreover, the poor current global equity and credit environment may pose additional challenges to the ability of the Company to secure equity or debt finance or to secure equity or debt finance on acceptable terms, including as to rates of interest. Current negative global market conditions and increasing political and geopolitical tensions could also adversely impact the ability to finance the Zanaga Project. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to financing of the Company

The Company will not generate any material income until an operating stage of the Project has been constructed and mining and export of the iron ore has successfully commenced at commercial volumes. In the meantime the Company will continue to expend its cash reserves. Should the Company seek to raise additional finance, it may be unable to obtain debt and/or equity financing in the amounts required, in a timely manner, on favourable terms or at all.

If construction of the mine and related infrastructure proceeds (including any preparatory steps associated with the construction of the mine and related infrastructure) or any small scale start-up proceeds, and ZIOC elects to fund its pro rata equity share of construction capital expenditure, there is no certainty as to its ability to raise the required finance or the terms on which such finance may be available.

If ZIOC raises additional funds (including for the purpose of funding the construction of the Project or any part of the Project, including any small-scale start-up) through further issuances of securities, the holders of ordinary shares could suffer significant dilution, and any new securities that ZIOC issues could have rights, preferences and privileges superior to those of the holders of the ordinary shares.

If the Company fails to generate or obtain sufficient financial resources to develop and operate its business, this could materially and adversely affect the Company's business, results of operations, financial condition and prospects. Current negative global market conditions and increasing political and geopolitical tensions could also adversely impact the ability to finance the Company. Such risk is reviewed constantly and any relevant changes considered.

Risk relating to Ore Reserves estimation

Ore Reserves estimates include diluting materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and studies have been carried out and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified. Ore Reserve estimates are by their nature imprecise and depend, to a certain extent, upon statistical inferences and assumptions which may ultimately prove unreliable. Estimated mineral reserves or mineral resources may also have to be recalculated based on changes in iron ore or other commodity prices, further exploration or assessment or development activity and/or actual production experience. Such risk is reviewed constantly and any relevant changes considered.

Host country related risks

The operations of the Zanaga Project are located mainly in the RoC. These operations will be exposed to various levels of political, regulatory, economic, taxation, environmental and other risks and uncertainties. As in many other countries, these (varying) risks and uncertainties can include, but are not limited to: political, military or civil unrest; fluctuations in global economic and market conditions impacting on the economy; terrorism; hostage taking; extreme fluctuations in currency exchange rates; high rates of inflation; labour unrest; nationalisation; changes in taxation; illegal mining; restrictions on foreign exchange and repatriation. In addition, the RoC is an emerging market and, as a result, is generally subject to greater risks than in the case of more developed markets.

HIV/AIDS, malaria and other diseases are prevalent in the RoC and, accordingly, the workforce of the ZIOC group and of the Jumelles group will be exposed to the health risks associated with the country. The operating and financial results of such entities could be materially adversely affected by the loss of productivity and increased costs arising from any effect of HIV/AIDS, malaria and other diseases on such workforce and the population at large.

Weather conditions in the RoC can fluctuate severely. Rainstorms, flooding and other adverse weather conditions are common and can severely disrupt transport in the region where the Jumelles group operates and other logistics on which the Jumelles group is dependent.

The host country related risks described above could be relevant both as regards day-to-day operations and the raising of debt and equity finance for the Project. The occurrence of such risks could have a material adverse effect on the business, prospects, financial condition and results of operations of the Company and/or the Jumelles group. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to the Project's licences and the regulatory regime

The Project's Mining Licence was granted in August 2014 and a Mining Convention has been entered into. With effect from 20 May 2016, the Zanaga Mining Convention has been promulgated as a law of the RoC, following ratification by the Parliament of the RoC and publication in the Official Gazette.

The holder of a mining licence is required to incorporate a Congolese company to be the operating entity and the Congolese Government is entitled to a free participatory interest in projects which are at the production phase. This participation cannot be less than 10%. Under the terms of the Mining Convention, there is a contingent statutory 10% free participatory interest in favour of the Government of the RoC as regards the mine operating company and a contingent option for the Government of the RoC to buy an additional 5% stake at market price.

The granting of required approvals, permits and consents may be withheld for lengthy periods, not given at all, or granted subject to conditions which the Jumelles group may not be able to meet or which may be costly to meet. As a result, the Jumelles group may incur additional costs, losses or lose revenue and its business, result of operations, financial condition and/or growth prospects may be materially adversely affected. Failure to obtain, renew, enforce or comply with one or more required approvals, permits and consents could have a material adverse effect on the business, prospects, financial condition and results of operations of the Company and/or the Jumelles group. Mitigation of such risks is in part dependent upon the terms of the Mining Convention and compliance with its terms. Such risk is reviewed constantly and any relevant changes considered.

Transportation and other infrastructure

The successful development of the Project (including any low-cost small scale start-up) depends on the existence of adequate infrastructure and the terms on which the Project can own, use or access such infrastructure. The region in which the Project is located is sparsely populated and difficult to access. Central to the Zanaga Project becoming a commercial mining operation is access to a transportation system through which it can transport future iron ore product to a port for onward export by sea. In order to achieve this it will be necessary to access a port at Pointe-Indienne, which is still to be constructed, or some other exit port in the case of a low-cost small scale start-up.

The nature and timing of construction of the proposed new port are still under discussion with the government of the RoC and other interested parties. In relation to the pipeline and Project facilities at the proposed new port and (to the extent needed) other infrastructure, the necessary permits, authorisations and access, usage or ownership rights have not yet been obtained.

Failure to construct the proposed pipeline and/or facilities at the proposed new port and/or other needed infrastructure or a failure to obtain access to and use of the proposed new port and/or other needed infrastructure or a failure to do this in an economically viable manner or in the required timescale could have a material adverse effect on the Project.

In the case of a low-cost small scale start-up, failure to put in place the necessary logistical requirements (including trucking, rail transportation and port facilities) and/or other needed infrastructure or a failure to obtain access to and use of the proposed logistical requirements or a failure to do this in an economically viable manner or in the required timescale could have a material adverse effect on the Project.

The availability of reliable and continuous delivery of sufficient quantity of power to the Project at an affordable price will also be a significant factor on the costs at which iron ore can be produced and transported to any proposed exit port and will impact on the economic viability of the Project.

Reliable and adequate infrastructure (including an outlet port, roads, bridges, power sources and water supplies) are important determinants which affect capital and operating costs and the ability of the Jumelles group to develop the Project, including any low-cost small scale start-up. Failure or delay in putting in place or accessing infrastructure needed for the development of the Zanaga Project could have a material adverse effect on the business, prospects, financial condition and results of operations of the Company and/or the Jumelles group. Such risk is reviewed constantly and any relevant changes considered.

Risks associated with access to land

Pursuant to the laws of the RoC, mineral deposits are the property of the government with the ability to purchase surface rights. Generally speaking, the RoC has not had a history of native land claims being made against the state's title to land. There is no guarantee, however, that such claims will not occur in the future and, if made, such claims could have a deleterious effect on the progress of development of the Project and future production.

The Mining Convention envisages that the RoC will carry out a process to expropriate the land required by the Zanaga Project and place such land at the disposal of the holder of the Mining Licence in order to build the mine and the infrastructure, including the pipeline, required for the realisation of the Zanaga Project. This means that the rights of the Jumelles company which holds the Mining Licence to the relevant land will be subject to negotiation between the Congolese government and such company. Alternatively, if the land is not declared DUP (i.e. is expropriated by the State under its sovereign powers) then the Jumelles group will have to reach agreement with the local land owners which may be a more time consuming and costly process. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to timing

Any delays in (i) obtaining rights over and access to land and infrastructure; (ii) obtaining the necessary permits and authorisations; (iii) the construction or commissioning of the mine, the pipeline or facilities at or offshore an exit port or power transmission lines or other infrastructure; or (iv) negotiating the terms of access to the exit port and supply of power and other infrastructure (including an offshore loading facility); or (v) raising finance to fund the development of the mine and associated infrastructure, could prevent altogether or impede the development of the Zanaga Project, including the ability of the Zanaga Project to export its future iron ore products whether on the anticipated timelines or at projected volumes and costs or otherwise. Such delays or a failure to complete the proposed infrastructure or the terms of access to infrastructure or to do this in an economically viable manner, could have a material adverse effect on the business, results of operations, financial condition and prospects of the Company and/or the Jumelles group. Such risk is reviewed constantly and any relevant changes considered.

Environmental risks

The operations and activities of the Zanaga Project are subject to potential risks and liabilities associated with the pollution of the environment and the disposal of waste products that may occur as a result of its mineral exploration, development and production, including damage to preservation areas, over-exploitation and accidental spills and leakages. Such potential liabilities include not only the obligation to remediate environmental damage and indemnify affected third parties, but also the imposition of court judgments, administrative penalties and criminal sanctions against the relevant entity and its employees and executive officers. Awareness of the need to comply with and enforcement of environmental laws and regulations continues to increase. Notwithstanding precautions taken by entities involved in the development of the Project, breaches of applicable environmental laws and regulations (whether inadvertent or not) or environmental pollution could materially and adversely affect the financial condition, business, prospects and results of operations of the Company and/or the Jumelles group. Such risk is reviewed constantly and any relevant changes considered.

Health and safety risks

The Jumelles group is required to comply with a range of health and safety laws and regulations in connection with its business activities (including laws and regulations relating to the COVID-19 pandemic) and will be required to comply with further laws and regulations if and when construction of the Project commences and the mine goes into operation. A violation of health and safety laws relating to the Jumelles group and/or the Project's operations, or a failure to comply with the instructions of the relevant health and safety authorities, could lead to, amongst other things, a temporary shutdown of all or a portion of the business activity of the Jumelles group and/or the Project's operations or the imposition of costly compliance measures. Where health and safety authorities and/or the RoC government require the business activity of the Jumelles group and/or the Project to shut down or reduce all or a portion of its activities of operations or to implement costly compliance measures, whether pursuant to applicable health and safety laws and regulations, or the more stringent enforcement of such laws and regulations, such measures could have a material adverse effect on the financial condition, business, prospects, reputation and results of operations of the Company and/or the Jumelles group. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to third party claims

Due to the nature of the operations to be undertaken in respect of the development of the Zanaga Project, there is a risk that substantial damage to property or injury to persons could be sustained during such development. Any such damage or injury could have a material adverse effect on the financial condition, business, prospects, reputation and results of operations of the Company and/or the Jumelles group. Such risk is reviewed constantly and any relevant changes considered.

Risks relating to outsourcing

The 2014 FS envisages that certain aspects of the Zanaga Project will be carried out by third parties pursuant to contracts to be negotiated with such third parties. Any low-cost small scale start-up is also likely to involve the undertaking of various key elements of the Project by third parties. There is a risk that agreement might not be reached with such third parties or that the terms of any such agreement are more stringent than currently anticipated; this could adversely impact upon the Project and/or the proposed timescale for carrying out the Project. Such risk is reviewed constantly and any relevant changes considered.

Fluctuation in economic factors

In terms of currency exchange rates, the Jumelles group's functional and reporting currency is the U.S. dollar, and most of its in country costs are and will be denominated in CFA francs and Euros. Consequently, the Jumelles group must translate the CFA franc and Euro denominated assets and liabilities into U.S. dollars. To do so, non-U.S. dollar denominated monetary assets and liabilities are translated into U.S. dollars using the closing exchange rate at the reporting period end date. Consequently, increases or decreases in the value of the U.S. dollar versus the Euro (and consequently the CFA franc) and other foreign currencies may affect the Jumelles group's financial results, including its assets and liabilities in the Jumelles group's balance sheets. These factors will affect the financial results of the Company. In addition, ZIOC holds the majority of its funds in Pounds Sterling, and incurs the majority of its corporate costs in Pounds Sterling, but its contributions to funding the Jumelles group in 2021 and 2022 are calculated in U.S. dollars. Consequently, any fluctuation in exchange rates between Pounds Sterling versus the U.S. dollar or the Euro, could also adversely affect the financial results of the Company. Furthermore, current fluctuations in inflation, interest rates, and supply chain reliability has the potential to adversely impact the Company and Jumelles today, while also potentially adversely impacting the economic viability of the Zanaga Project, as well as the ability to secure finance for the development of the Zanaga Project. Such risks are reviewed constantly and any relevant changes considered.

Cash resources

The Company has limited cash resources. Although the Company has taken steps to conserve and replenish its cash resources, there is a risk that a shortage of such cash resources will adversely affect the Company. Such shortage could result in further expenditure cuts being introduced by the Company, both in its internal and its external operations. Volatile and uncertain economic global conditions in means that there can be no certainty as to when the Zanaga resource is likely to be developed. The challenging economic conditions as well as difficulties of monetising this resource given its location impact upon the ability of the Jumelles group to raise new finance for the Project as well as on the Company's ability to raise new finance for itself. The Company's existing cash resources may continue to come under increasing pressure unless a more predictable investment, travel and trading climate materialises in the foreseeable future which benefits the Project and the Company can take steps which result in an improvement of its financial position. Such risk is reviewed constantly and any relevant changes considered.