Expansion

Ferrexpo PLC 22 November 2007 Expansion of Existing Operations beyond IPO Business Plan Ferrexpo plc ('Ferrexpo') is pleased to announce the commencement of a US$158 million project to expand production at its current mining operation on the Gorishne - Plavninskoye Lavrikovskoye ('GPL') deposit to approximately 32mt of iron ore per annum by 2011 and to extend the life of the mine at these production levels to at least 2035. This additional ore production will enable the Company to take advantage of currently under-utilised processing capacity to increase high quality pellet production by approximately 1.3mt per annum. This production expansion and extension of mine life are in addition to that detailed in the business plan associated with Ferrexpo's listing in June. As foreshadowed at the time of the listing, a GPL pit optimisation study has been undertaken by Ferrexpo in conjunction with Turgis Consulting (Proprietary) Limited ('Turgis'), the Company's South Africa-based mining engineering partner, which has determined that it is possible to increase production of iron ore at the GPL mine from current production levels of approximately 28mt per annum to at least 32mt per annum. The design of the pit expansion is such that the incremental ore mined will consist entirely of richer ore, all of which will be used to produce Ferrexpo's higher quality pellets containing 65% Fe. This additional ore will be processed through the existing beneficiation and pelletising plants, which have surplus capacity, enabling capital efficient pellet production expansion to be achieved. Once full ore production is reached in the GPL pit, it is expected that pellet production levels from produced ore will be increased by about 1.3mt per annum of 65% Fe pellets. The Board of Ferrexpo PLC has approved US$158 million in development capital expenditure for this project. US$68 million will be spent on capitalised stripping works over the next 3 years, to be implemented immediately to the north of the of the current pit operations. Most of the remainder will be spent on additional mining equipment. The engineering design work carried out on the GPL open pit has determined that the mine life can be extended at the expanded production levels by at least 12 years, to 2035. SRK Consulting and Turgis have been engaged to independently review and verify the resource and reserve estimates and the GPL reserves will be formally restated once this evaluation is complete. Mike Oppenheimer, Ferrexpo CEO, said: 'In September we announced the initial capital commitment for the new Yeristovskoye mine, the first of our major growth projects. While moving this project and our other longer term growth options ahead on schedule, we have also been aggressively pursuing nearer term options for expanding our production to meet strong demand from our customers and to take full advantage of our under-utilised processing capacity. The results of the GPL optimisation study have confirmed the huge unrealised potential of our resource at Poltava. Given our surplus ore processing capacity, with relatively modest capital investment in the mine we can achieve a highly capital efficient 15% increase in pellet production from our own ore over the next 3 years. This incremental production will all be of the higher quality favoured by our customers and will not require material additions to fixed costs, thereby delivering higher margins. We will continue to pursue opportunities for extracting greater value from our current operations whilst not losing focus on our major growth projects.' For further information, please contact: Ferrexpo: +44 207 389 8304 Gavin Mackay Finsbury: +44 207 251 3801 Robin Walker Alex Simmons Notes to Editors: Ferrexpo is a Swiss headquartered resources company with assets in Ukraine, principally involved in the production and export of iron ore pellets, used in producing steel. Current output is over 9 million tonnes, approximately 85% of which is exported to steelmakers around the world. The Group is currently undertaking a significant growth programme and listed on the main market of the London Stock Exchange in June 2007 under the ticker FXPO. For further information please visit www.ferrexpo.com. This information is provided by RNS The company news service from the London Stock Exchange

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Ferrexpo (FXPO)
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