£450,000 Placing to fast-track Sierra Leone Ir...

Sula Iron & Gold plc / Index: AIM / Epic: SULA / Sector: Natural Resources   

2 November 2012

                Sula Iron & Gold plc (`Sula' or `the Company')                 

 £450,000 placing to fast-track Sula's Sierra Leone iron project and initiate  
                               drilling campaign                               

Sula Iron & Gold plc, an iron ore and gold exploration company focussed on
Sierra Leone, is pleased to announce that, as a result of market demand, it has
raised a further £450,000 by way of a placing of 7,500,000 new ordinary shares
in the capital of the Company (`the Placing Shares'), at a price of 6 pence per
Placing Share together with Warrants to subscribe for ordinary shares (`the
Placing'). Placees will receive one Warrant for every two Placing Shares
subscribed for, exercisable at 8p per share for a period of twelve months from
today. The Placing has been conducted by Northland Capital Partners Limited and
Beaufort International Associates.

The funds raised will be utilised to fast-track the development of Sula's 153
sq km iron ore and gold licence area (`the Project') in the mineral rich Sula
Mountain Range in Sierra Leone, which is contiguous to African Minerals'
operational Tonkolili iron mine which hosts a 12.8 billion tonne resource, to a
drill ready status during Q1 2013 and undertake a drilling programme to confirm
the Project's economic potential.

On Sula's admission to AIM earlier this month, the Company stated that it
planned to complete two additional magnetometer surveys at the Project in Q4
2012 to further confirm the presence of banded iron formation (`BIF') at
surface and the extension of magnetic anomalies from the Tonkolili licence into
the Sula licence. Having conducted further analysis of the exploration data,
which included an initial magnetometer survey completed in June 2012, Sula has
implemented a revised exploration programme which it believes will fast-track
the advancement of the Project and unlock the licence area's iron ore and gold
resource potential.

The revised work programme will include acquisition and interpretation of high
resolution satellite imagery; detailed mapping to ascertain the source of gold
mineralisation; and detailed mapping of the outcropping BIF mineralisation to
better define the spatial extent of near surface direct shipping ore (`DSO').
The Company is also planning to excavate a number of trenches across DSO
outcrops which will facilitate channel sampling of these zones in preparation
for drill targeting ahead of a planned Q1 2013 drilling programme.

Sula's Chief Executive Nick Warrell said: "Our revised exploration programme
will accelerate the progression of our licence area which has been identified
as having outcropping BIF with DSO potential to a drill ready status by Q1
2013. This is a major advancement in terms of the Project's development and
exploration schedule as we look to define the iron ore resource potential of
the Project and enhance its attributable value in the near term".

"In tandem, reconnaissance work and field mapping will be conducted in the
northern part of the licence where extensive artisanal gold workings indicate
the potential for a primary greenstone-hosted gold deposit. Previous grab
samples in the area have assayed up to 4.92 g/t Au, giving the project dual
commodity exposure. As part of the gold exploration programme, the company is
planning to re-log and re-sample historic diamond drill core. By fast-tracking
the exploration and development of both the iron ore and gold mineralisation in
our licence area, with the aim of delineating a JORC compliant resource, we
believe we can rapidly advance the project up the development curve to enhance
shareholder value."

Q4 2012/ Q1 2013 Exploration Programme

Data Review / Produce GIS Database

A significant amount of work has been completed to date within the Company's
153 sq km licence area. Historic exploration work included extensive surficial
geochemical sampling, a shallow RAB drilling programme and over 5,000 metres of
diamond drilling. Sula intend to re-log and re-sample the drill core and
incorporate this data into a modern geographical information system ("GIS")
database. The historic drill core should provide significant information on
bedrock geology, alteration signatures and mineralisation styles.

Creation of a verified and integrated GIS database, which incorporates historic
information and the Company's recent exploration data, will allow more
effective spatial interpretation of data and streamlined integration of future
exploration work.

High Resolution Satellite Imagery

In tandem with producing a new GIS Database, Sula plans to acquire high
resolution satellite imagery across the whole licence which will provide
important lithological and structural information and allow for more effective
sampling, mapping and ultimately drill targeting. Integrated GIS and satellite
data will also allow Sula to rapidly conduct reconnaissance between the known
prospects, where there is potential for additional iron and gold
mineralisation. Importantly, imagery will provide detailed spatial information
on alluvial workings which will assist with vectoring to the source of
mineralisation.

Field Mapping and Trenching- Iron Ore

Sula plans to commence a detailed mapping and sampling programme of the
outcropping BIF mineralisation in November 2012 in conjunction with a scout
trenching programme planned to commence in December 2012. Trenches will be
excavated to a depth of between 2 to 4 metres across areas with the highest
grade and most extensive BIF signature. This will allow Sula to channel sample
continuous exposure and provide important information on grade and thickness
relationships and structural features not obvious in surface outcrop. Trenching
and channel sampling is an important pre-requisite to fine tuning drill
targets. The programme will give a clearer indication on the overall size of
BIF outcrop, distribution of the oxidised hematite cap and major structural
elements. The Company is confident that the oxidised hematite cap has direct
shipping ore (`DSO') potential which would greatly enhance the economics of the
Project. Additionally the trenching will allow Sula to accurately pinpoint the
locations of the drilling rig for the proposed core drilling programme in Q1
2013.

Priority will be given to the ridge coincident with the magnetic anomaly at
Area 1 (see figure 9-2 of CPR), in order to assess the potential for oxidised
BIF along this large structure. A key component of the mapping will be to
locate structures cross cutting the BIF, which act as conduits for oxidising
meteoric fluids, creating favourable conditions for formation of oxidised and
enriched DSO ores. This structural relationship has been observed at the
Tonkolili iron ore deposit.

Field Mapping - Gold

The overall geological setting, presence of extensive artisanal gold workings,
and evidence from historic work and recent work by mining consultants SRKES,
demonstrates the significant potential of the licence to host gold
mineralisation. However, to date there appears to be little understanding of
the source area, style of mineralisation or conceptual exploration models.

Development of the unified GIS database and reinterpretation of the historic
data will provide an initial understanding of the gold potential and allow for
conceptual models to be generated. Mapping of artisanal workings using high
resolution satellite base maps will provide significant information on the
source area and landscape evolution. Field testing of this data and scout
mapping of priority areas will then be conducted to better understand the
potential extent of gold mineralisation and allow prioritisation of advanced
targets. This will allow the design of appropriate follow-up sampling,
trenching and ultimately drill programmes focussed on gold. This reconnaissance
mapping should provide sufficient information to generate conceptual models and
showcase the gold potential of the licence.

The Placing

The Placing Shares will, when issued, rank pari passu in all respects with the
existing ordinary shares of the Company. Application will be made to the London
Stock Exchange for the Placing Shares to be admitted to trading on AIM (`the
Admission'). It is expected that Admission will become effective and that
dealings in the Placing Shares will commence at 8.00am on 8 November 2012.

Following Admission, the Company's enlarged issued share capital will comprise
151,362,046 ordinary shares with voting rights. The Company does not hold any
shares in treasury. This figure of 151,362,046 ordinary shares may be used by
shareholders in the Company as the denominator for the calculations by which
they will determine if they are required to notify their interest in, or a
change in their interest in, the share capital of the Company under the FSA's
Disclosure and Transparency Rules.

                                   **ENDS**                                    

For further information please visit www.sulairongold.com or contact the
following:

Brian Moritz                Sula Iron & Gold plc           + 44 (0) 7976 994300
                                                                               
James Caithie / Avi         Cairn Financial Advisers LLP   [phone]
Robinson                                                                       
                                                                               
John-Henry Wickes / Alice   Northland Capital Partners     [phone]
Lane                        Limited                                            
                                                                               
Chris Theis                 Merchant Securities Limited    [phone]
                                                                               
Felicity Edwards            St Brides Media and Finance    [phone]
                            Ltd                                                
                                                                               
Charlotte Heap              St Brides Media and Finance    [phone]
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