Approach in Respect to Possible Offer

Beacon Hill Resources Plc / Ticker: BHR / Index: AIM / Sector: Mining

Beacon Hill Resources Plc ('Beacon Hill' or 'the Group')

Approach in Respect to Possible Offer for the Entire Issued and to be Issued Share Capital of Beacon Hill

Beacon Hill, the AIM listed coking coal producer, notes the recent move in its share price and announces that it has received an unsolicited, indicative, non-binding approach for the entire issued and to be issued share capital of the Company at a price of 16.25p per share payable in cash from a third party ('the Proposal').

The approach is at a very early stage and includes a number of conditions that may or may not be satisfied. Whilst the Proposal is at a significant premium to the current share price, the Board does not believe that, as currently drafted, the Proposal fully reflects the value inherent in the Group.

Beacon Hill continues to make excellent progress in the development of the Minas Moatize Mine, a producing coking coal mine in the Tete Province of Northern Mozambique. This is in line with its defined development plan to expand the open pit ready for pre-stripping in Q1 2012, producing up to 4Mtpa of run of mine which equates to approximately 2.35Mtpa of saleable coal. As announced in early March 2011, TWP Australia Pty Ltd has been appointed to finalise the Definitive Feasibility Study, including the design of both the mining operation and also the permanent Coal Handling and Preparation Plant, and their work continues to progress well and on schedule.

As previously announced the Group is making significant progress with logistics, following the successful completion of the trial trucking operation. Preparations have commenced to truck coal to the port of Beira in readiness for the Group's maiden export shipment, targeted for the end of this year.

The Group continues to have active discussions with the operators of the Sena Rail Line and is confident of making progress with regard to transporting coal via the Sena Rail Line to the port of Beira. Initial train loads of coal are being transported down the Sena railway, which will have capacity to transport 6Mtpa of coal when fully operational, and has been identified as a suitable long term logistics solution for the Group.

Shareholders should be aware that Beacon Hill is not subject to the City Code on Takeovers and Mergers.

A further announcement will be made when appropriate.

**ENDS**

For further information on the Company, visit www.bhrplc.com or contact:

Notes

Beacon Hill Resources Plc (AIM: BHR) is an AIM listed resource company focussed on the acquisition and development of assets in commodities relating to the steel production industry. The Group currently has two primary assets - the Minas Moatize Coal Mine in Tete, Mozambique and Tasmania Magnesite NL in Tasmania.