Pit Excavation Work Commences at Minas Moatize

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

2 June 2010

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

Opencast Pit Excavation Work Commences at Minas Moatize Coal Project in Tete, Mozambique

Beacon Hill Resources Plc (AIM: BHR), the AIM listed resource company, is pleased to announce the commencement of excavation works to extend the existing opencast pit at the recently acquired Minas Moatize coal mine in the Tete Province of Mozambique. The excavation work is intended to increase the production by an additional 120,000 tonnes over the next 12 months. This is in addition to the refurbishment of the underground mine that will see production increased from approximately 2,500 tonnes per month to 8,000 tonnes per month.

The Minas Moatize coal mine, which was acquired by BHR Mining Limited ('BHR Mining'), Beacon Hill's 49% owned associate and in which the Group has an option giving exclusive right to increase its interest to 75%, is the only operating mine in the globally significant coking coal region of Tete. This excavation work is part of the Group's strategy to rapidly increase production at the mine in the short term. Production of coal is expected to increase to circa 8,000 tonnes per month through improvement works at the current underground mine, in addition to the 120,000 tonnes due to be produced from the small scale open cut using the existing trial pit.

Approximately 115,000 tonnes of overburden will be excavated over the next three months to expose the coal seam and allow the extraction of approximately 120,000 tonnes of coal.

Local contracting and equipment hire company Tayanna Mozambique has been engaged to complete both the overburden excavations and the subsequent coal extraction. A South African opencast superintendant has been engaged to manage the project on behalf of BHR Mining.

Beacon Hill Executive Chairman Justin Lewis said, "The excavation of the opencast pit will enable BHR Mining to produce an additional 120,000 tonnes of thermal coal over the next twelve months that will be sold to local coal users generating additional revenues during the development period of the mine. This is a vital component of our overriding strategy, to establish a large scale open cut operation producing approximately 4Mtpa ROM coal and annual revenues in excess of US$200 million within the next 18 months."

**ENDS**

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