Operations and Exploration Update

22 January 2013

Mwana Africa PLC

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

Operations and Exploration Update

Mwana Africa PLC is pleased to provide an update on operations and exploration activity for the quarter ending 31 December 2012.

Highlights

·; Freda Rebecca: 16,506 ozs of gold sold by Freda Rebecca for the quarter, representing an increase of 43% over the same quarter in 2012, with achieved recoveries of 80%.

·; BNC: restart programme well underway with first sale of concentrate targeted for Q2 2013.

o 1,337m of underground development allowing for the re-commissioning of underground rock handling systems, shafts and surface crushing facilities

o 41,000t of ore crushed and stockpiled during the quarter.

·; BNC: drilling continued at Trojan, key mineralised intercepts received during Q4 include:

o 27.0m at 3.50% Ni from 359m (BH 3577)

o 94.0m at 3.14% Ni from 224m (BH 3579)

o 27.7m at 10.63% Ni from 264m (BH 3576)

o 10.7m at 11.02% Ni from 368.7m (BH 3570)

o 35.75m at 9.44% Ni from 177m (BH 3583)

·; Zani Kodo: Four diamond drill rigs continue work programme on site, preparation work underway for a resource update in Q1 2013.

Kalaa Mpinga, CEO of Mwana, commented:

"The pace of the mine preparation and processing plant refurbishment work that is currently being conducted at the Trojan mine has been exceptional. I am pleased to reiterate that the Company remains on track to sell first concentrate to our off-take partner, Glencore International, in Q2 2013. The exploration team at Zani Kodo has been working hard, and I look forward to reporting a resource update to the market later this quarter."

For further information please visit www.mwanaafrica.com or contact:

Mwana Africa PLC Tel: +44 (0)20 7654 5580

Donald McAlister / Lorenz Werndle

Nominated Adviser and Broker

Liberum Capital Limited Tel: +44 (0)20 3100 2000

Michael Rawlinson / Tom Fyson / Christopher Kololian

Public & Investor Relations

Tavistock Communications Tel: +44 (0)20 7920 3150

Ed Portman / Simon Hudson / Mike Bartlett

About Mwana Africa PLC

Mwana Africa PLC is a pan-African, multi-commodity mining and development company. Mwana's principal operations and exploration activities cover gold, nickel, copper and diamonds in Zimbabwe, the DRC and South Africa.

Mwana's Freda Rebecca gold mine in Zimbabwe, having restarted operations in 2009, produced 47,770 ozs of gold in the 12 months to March 2012. Record quarterly gold production of 18,350 ozs was achieved in the third quarter of 2012.

In February 2012, Mwana announced a gold mineral resource of 2.01 million ounces at its Zani Kodo project in Democratic Republic of Congo.

In August 2012, Mwana announced it had entered into a Cooperation and Development Agreement with Zhejiang Hailiang Company Limited to jointly explore its copper licence areas in the Katanga Province of the DRC.

In September 2012, Mwana's subsidiary, Bindura Nickel Corporation, carried out a restructuring and recapitalisation involving US$23m being invested into BNC which has allowed it to restart its Trojan nickel mine. First sale of concentrate to Glencore International is expected in Q2 2013.

Further information on the Company can be found at www.mwanaafrica.com.

Freda Rebecca Gold Mine

A total of 16,506 ounces ("ozs") of gold was produced during the quarter ending 31 December 2012. Average monthly production for the quarter was 5,502 ozs. Quarterly output represents a 43% increase over the comparable quarter last year. The 52,840 ozs produced for the nine months to date represents a 58% increase on the comparable period last year. The current rate of production reflects an annualized rate of over 70,000 ozs per annum.

Table 1: Summary of Freda Rebecca Quarterly Production Results

Figures shown are unaudited and may vary upon final audit. Gold ounces produced incorporate gold released from or caught in 'lock-up' for each period.

C1 Cash cost includes costs for mining, processing, administration, accounting movements for stockpiles and gold-in-circuit, and, net proceeds from by-product credits. It excludes capital costs for exploration, mine development or processing mill capital works, and, the cost of royalties.

C2 Production Cost reflects C1 costs plus depreciation and amortisation, thus incorporating the capital cost of production.

C3 Total Cost reflects C2 plus interest, other indirect costs and royalties. Total cost represents all costs attributable to gold production over the period.

Gold produced for the fourth quarter reduced slightly from the record production levels in the previous quarter but remained above plan. Internal dilution associated with a known waste dyke within one of the main production areas contributed to a reduction in head grade from the previous quarter. Mill throughput was adversely affected by a breakdown of the primary crusher during December. Repairs to the crusher are underway and expected to complete in Q1 2013, meanwhile the run of mine feed is being diverted through a parallel primary crusher to maintain mill feed.

Reduced metallurgical recovery for the quarter was attributable partly to a lower feed grade but also to a breakdown during December on the mine's compressors feeding air to the leach circuit, adversely affecting leach kinetics within the circuit. This breakdown has been repaired and leach kinetic performance has been restored to normal.

Cash costs increased by 10.9% compared to the previous record quarter due to the lower ounces produced.

Further information about Freda Rebecca Gold Mine can be found at:

www.mwanaafrica.com/operations-and-exploration/zimbabwe/freda-rebecca-gold-mine 

Zani-Kodo JV

Exploration drilling continued with four diamond drill rigs active during the quarter. Drilling was focused on two areas:

§ Kodo

§ Lelumodi

The location of these areas is shown in Figure 1 (figures can be found at the end of the announcement).

Kodo Area

The Kodo area has been the main focus of drilling to date and contains a defined resource (January 2012) of 1.40Moz @ 4.02g/t.

Six holes for a total of 2,244m were completed at Kodo during the reporting period. These were concentrated on the southern margin of the Kodo Main ore zone with a view to both extending the wireframe and clarifying the orebody geometry in this area (Figure 2).

Results were received for eight holes. These are tabulated below with locations shown in Figure 2.

*Widths reported are down hole measurements and as such not true widths

Table 2: Results received during October-December 2012, Kodo area.

The results indicate the following:

§ Hole KDODD084 has extended the mineralised envelope to the north.

§ Holes KDODD091, 087, 092 and 086 all intersect two distinct ore zones along the southern margin of the Kodo area. These holes have clarified the orebody geometry in this area, with the two zones interpreted to be the result of thrust repetition.

§ Hole KDODD086 has extended the mineralised envelope by 50m along strike and 100m downdip and will result in a significant increase in resource in this area.

§ Holes KDODD085 and 098 intersected multiple narrow zones in the hanging wall of the Kodo Main orebody. These are associated with distinctive shallow dipping grey quartz veins and are interpreted as extensional features developed during the main compressional deformation event. Grades greater than 10g/t are locally present. Continuity between holes is good over a significant area (from hole KDODD075 to KDODD098, Figure 2). Modelling of these structures is in progress and they may contribute additional high grade resources.

§ A resource update for Kodo is planned for Q1 2013. This will include results from 23 additional holes as shown in Figure 2 and will be based on an improved structural model for the deposit incorporating a basal thrust and a series of steeper, reverse movement sense splays (Figure 3).

Lelumodi

Ten holes were completed during the reporting period for a total of 3,462m drilled. These were concentrated on a 50m x 50m grid over a strike length of 400m.

Results were received from a further 21 holes. Best intersections are tabulated below, with locations shown in Figure 4.

*Widths reported are down hole measurements and as such not true widths

Table 3: Results received during October-December 2012, Lelumodi area. N.B. Only intersections>2metregrams/t shown.

The results indicate the following:

·; On a district scale the main mineralized structure has moved up the NE dipping sequence along a NE-SW trending lateral ramp immediately south of Zani Central (Figure 1). This accounts for the lack of mineralization at the Gombiri area (Figure 1).

·; Mineralisation is associated with a series of strongly silicified felsic tuff units within a sequence of metabasalts and metadolerites.

·; Two laterally persistent zones of >10m width are present in all holes along the current drilled out strike length with grades typically in the range of 1.5-2.0g/t.

·; Locally these two zones merge into a single broad zone, with best intersections of 51m @ 2.01g/t, 59.6m @ 2.04g/t and 50m @ 2.51g/t, including 20m @ 3.76g/t in this area (Figure 5).

·; A series of narrower felsic units are also present in the hanging wall of the main zones (Figure 5). Best intersection in these units is 8.2m @ 3.30g/t in hole ZNSDD042 (Figure 5).

·; Immediately north of hole ZNSDD050 the orezones are faulted out. The offset strike continuation is interpreted to occur to the NE and will be targeted in 2013.

·; Modelling of the Lelumodi orezones is on-going, with continuity along strike and down dip being good.

·; An initial resource calculation for the Lelumodi area will be carried out in Q1 2013.

The excellent results received to date at Lelumodi are extremely encouraging for district scale exploration. Drilling has shown that soil geochemistry is an effective exploration tool, successfully identifying the presence of multiple mineralised zones. To date only 400m strike length has been drilled, which represents just 10% of the overall 4,000m long anomaly (Figure 1). Exploration during 2013 will test strike extensions of the Lelumodi zones to both NW and SE.

Further information about Zani Kodo can be found at:

www.mwanaafrica.com/operations-and-exploration/drc/zani-kodo-project 

Bindura Nickel Corporation

On the 21st of September, Mwana announced that BNC had completed a rights issue and placing required to recapitalise BNC and to recommence operations. Following the success of the rights issue, work commenced on the restart programme at Trojan nickel mine. Work has progressed well, both in the underground section and the processing plant refurbishment programme.

During the quarter underground development has restarted at the mine with a total of 1,337m being blasted and developed. This has provided the basis for the successful re-commissioning of underground rock handling systems, shafts and surface crushing facilities.

A total of approximately 71,000t of ore and waste rock was hoisted, of which 41,000t ore was crushed and stockpiled. A total of 52,000t of crushed ore is at present on mill feed stockpiles.

The refurbishment of the surface milling and concentrator circuits, together with concentrate and tailings handling facilities, has progressed well and is at an advanced stage. The restart at Trojan remains on track to sell first concentrate in Q2 2013. BNC has an off-take agreement in place with Glencore International for the sale of concentrate from Trojan.

Phase I of the resource drilling programme at Trojan, aimed at confirming the down dip extension of the massive sulphide zone within the main ore body, was completed during the quarter. A number of significant intersections of high grade nickel intercepts were reported by Mwana on the 8th of October and the 28th of November. Work is underway to complete an updated resource statement from the results generated to date.

Further information about Bindura Nickel Corporation can be found at:

www.mwanaafrica.com/operations-and-exploration/zimbabwe/bindura-nickel-corp-bnc 

Katanga Base Metals Concessions (SEMHKAT)

The expected generally low level of activity over the quarter was due to the onset of the annual rains and the December break. The licence locations are shown in Figure 6.

Lunsano

During the fourth quarter, exploration work concentrated on Priority 1 & 2 areas, advancing them to drill-ready targets for 2013 (Figure 7).

Geological Mapping

Geological investigations focussed on the Southern copper geochemical anomaly, which comprises Priority 1 & 2 areas to the east and Kilundu Mine Series Units (Priority 3) to the west. Both trenching and pitting continued to explore Priority 1 & 2 areas (Figure 7). In Priority 1 and Priority 2 areas, surveys targeted the Cu-Co mineralisation potential of the brecciated shale zones (Mwashya, R4) related to the NW-SE trending structures and the gradational shale-sandstone-Grand Conglomerat contact zone (R4-Ki) respectively. In Priority 2, the high soil and pit copper values running parallel to this contact zone prompted this investigation.

For the Kilundu Mine Series units (Priority 3, Figure 8) it was found that all of the units are inclined at an average of 55º to the north east. The structural data indicate the likelihood of overturned folding. The normal sequence of units has furthermore been affected by both strike-slip and dip-slip faulting. There is potential for Cu-Co mineralisation in the upper orebody (SD) and lower orebody (RSC & RSF).

Priority 1, 2 & 3 areas are ready for probing of Cu-Co potential by drilling in 2013.

Sampling results.

During the quarter 1,108 and 135 trench samples were analysed by the ALS Chemex laboratory and the Niton hand-held XRF respectively.

Pit geochemistry

Of the 716 pit samples generated from 208 pits dug in Priority 1 & 2 areas over this period, 614 samples were analysed by Niton. High copper values coincide with brecciated shale zones and the shale-sandstone-Grand Conglomerat contact zone as shown in Figure 7.

Trench geochemistry.

1,108 samples from the Kilundu Mine Series trenches were assayed following initial favourable Niton screening. Notable trench intercepts (100+ ppm Cu) are summarized as in Tables 4a & 4b. Instances where Cu content is lower than Co are highlighted in bold in the tables below: This is a common phenomenon in RSC and RSF rocks of Katanga. Peak 1m trench intercepts of 3,750ppm Cu and 3,490ppm Cu, 1,390ppm Cu and 1,690ppm Cu, 1,390ppm Cu, 1,220ppm Cu, 1,210pp Cu and 890ppm Cu were encountered in TRMS 6,TRMS5, TRMS 1A, TRMS 4, TRMS 3 and TRMS 2 respectively (Figure 8, Table 4a & 4b). All of the Mine Series units exhibit encouraging values of Cu and Co with high values from the shale, where visible malachite veinlets have been intersected. Black minerals- most probably heterogenite (cobalt) oxides- are abundant in the RSC and RSF units. The results confirm the potential for Cu-Co mineralisation in the Kilundu Mine Series units (Table 4a & 4b).

Reverse circulation drilling to probe potential mineralisation coupled with a few diamond drill holes to confirm stratigraphy is planned for 2013.

Table 4a: Kilundu Mine Series trench intercepts (ALS lab assays)

Table 4b: Kilundu Mine Series trench intercepts (ALS lab assays)

The 135 trench samples assayed by Niton emanated from TRMS 8 and TRMS 8A. The notable trench intercepts are shown in Table 5.

Table 5: Kilundu Mine Series trench intercepts (Niton assays)

AMBASE-SEMHKAT JOINT VENTURE

Six diamond drill holes, totalling 416m were drilled during October. Two holes apiece were drilled in Kasolo, Konga and Kitompe.

At Kasolo, the two diamond drill holes (NWDD012, 13) which targeted the Ni-rich eastern portion, intersected brecciated, silicified and highly talcose siliciclastic rocks. Initial Niton assays yielded peak values of 0.66% Ni and 1.5% Cu over 2m. Ambase recommends follow-up of the Kasolo target.

At Konga, two diamond drill tails drilled as extensions to RC pre-collars, intersected largely unaltered black shale and other siliciclastic rocks. Both holes show some brecciation and veining, but no significant Cu mineralisation (maximum of 0.18% Cu over 2m).

A narrow zone of sub-economic oxide mineralisation was intersected in the pre-collar portion of the hole.

Two holes drilled at Kitompe (NWDD016, 17) intersected the Kakontwe limestone with a maximum of 0.25% Cu over 2m.

The ground geophysical survey was concluded in October.

At the onset of the rainy season, all personnel and equipment were demobilised from the field by the end of October.

Ambase has notified Mwana that it is terminating the joint venture with SEMHKAT. Following this notification Ambase has no further interest or ownership in the JV licence areas and Mwana is currently reviewing whether it will continue exploration on this ground in its sole capacity.

Further information about the Katanga Concessions can be found at:

www.mwanaafrica.com/operations-and-exploration/drc/katanga-concessions  

For associated maps (Figures 1, 2, 3, 4, 5, 6, 7 & 8), please click on, or paste the following link in to your web browser, to view the PDF file:

http://www.rns-pdf.londonstockexchange.com/rns/0442W_-2013-1-21.pdf