Quarterly Activities and Cashflow Report

31 January 2013

Ferrum Crescent Limited

("Ferrum Crescent", the "Company" or the "Group") (ASX: FCR, AIM: FCR, JSE: FCR)

Quarterly Activities and Cashflow Report

For the period ended 31 December 2012

Ferrum Crescent Limited, the ASX, AIM and JSE quoted iron ore developer in Northern South Africa, today announces its quarterly results for the three month period ending 31 December 2012.

HIGHLIGHTS:

Moonlight Iron Ore Project - 2012 Operational Summary:

Ø New JORC compliant resource at Moonlight Iron Ore Project of 307.8 million tonnes @ 26.9% Fe.

Ø Advanced geological model of JORC compliant resource area and identified new prospective areas following 2,827 line km (on 50m line) spacing and high resolution airborne magnetic survey at Moonlight.

Ø Mining Right granted covering Moonlight, Julietta and Gouda Fontein areas

o All requirements met under South African law, including environmental and social and labour plans.

Ø Transnet and infrastructure provider model progressed towards completion of BFS

o Detailed analysis of pellet plant location advanced following review of rail capacity and power availability to supply internal steel industry

o Potential water providers identified

o Infrastructure conclusions being compiled to coincide - first production to commence benefiting from current infrastructure initiatives undertaken for Limpopo Province.

Corporate:

Ø Cash as at 31 December 2012 is approximately A$1.8m

Commenting today Ed Nealon, Chairman, said: "As a secure source of supply for export and potentially to the South African steel industry Ferrum Crescent is working closely with its offtake partners, alongside various industry heads and levels of Government, to ensure our stated timeline for the development of the Moonlight Iron Ore project is maintained. Work with Transnet is particularly advanced with final conclusions being made on how long-term costs can be restricted en route to market. Ferrum Crescent is in a position where it believes it can utilise large amounts of existing capacity to reach a final customer base located within a few hundred kilometres."

Moonlight Project overview

As announced on 19 December 2012, the Company is currently undertaking a bankable feasibility study ("BFS") in relation to the potential development of a deliverable, low cost magnetite ore project that produces a high grade, low contaminant iron pellet product following beneficiation. The current established JORC compliant resource is 307.8 million tonnes Resource @ 26.9% Fe, a magnetite ore with metallurgy that demonstrates capability for high grade product up to 69.7% Fe grade. Metallurgical testing phases have also shown that the product is likely to contain extremely low contaminants - 2.05% SiO2, and 0.40% Al2O3, and 0.01% P.

It is anticipated that Moonlight will be developed as a contract, open-pit mine with onsite concentrate production. A slurry concentrate pipeline to a pelletising plant near railhead will be created, with return water to Moonlight (100 - 220km); current preferred sites are at Lephalale and Thabazimbi. A pelletising plant to produce iron ore pellets (68.5% Fe) for international and domestic markets is planned with production at 6Mtpa direct reduction iron and blast furnace pellets. With a high grade, pure product near existing rail infrastructure and producing steel mills, an offtake agreement for initial production has already been signed with Duferco SA.

Strategic rationale for 2012 work programme

With extensive exploration already complete at Moonlight, Ferrum has prioritised increasing the economic understanding of the existing mineralisation in order to provide the data needed to complete a BFS for development of the project into near-term production. Focussed work was also undertaken to examine the expansion potential of Moonlight outside of the existing JORC delineation. With long lead times often involved in procuring relevant licensing for development the Company also made it a clear objective to secure a full, granted mining licence over all of the Moonlight area. The Group's mining right has been granted, executed and registered.

In addition to work being carried out directly at the Moonlight Deposit, detailed analysis of the infrastructure solutions for both the Moonlight open pit mine and pelletising plant have been underway with providers such as Transnet and Eskom. Located in the Limpopo Province of Northern South Africa, Moonlight is located near two major rail hubs that potentially will have the capacity to carry the project's iron ore pellets for export and to local steel producers. Given the high grade pellet product Ferrum is looking to produce, the last quarter saw a detailed examination of the most efficient location for the plant in terms of power usage and ore versus pellet transportation costs. Limpopo Province sits well to the north of traditional iron ore mining operations in South Africa and is seeing a range of initiatives currently undertaken in the region to promote the economy. Over the quarter, Ferrum and the infrastructure partners it is in consultation with have modelled a series of scenarios that derive benefit from such government infrastructure programmes.

2013

With an economic rationale established from current resource and metallurgical work at Moonlight, the Company's focus for the first part of the year is to finalise the infrastructure model for power, water and transportation. As a secure source of supply of high grade product to steel producers internationally and potentially within South Africa, Ferrum Crescent is working closely with its offtake partners, alongside various industry heads and levels of Government, to ensure our stated timeline to production is maintained. Work with Transnet is advanced, with final conclusions being made on how long-term costs can be restricted on route to market. Ferrum Crescent is in a position where it believes it can utilise large amounts of existing capacity to reach a final customer base located within a few hundred kilometres.

Ferrum Crescent will continue to progress the Moonlight Iron Ore Project, with the intention of having a BFS completed within the next 12 to 18 months.

Corporate

On the 14th December 2012, the Company issued 4,078,060 ordinary shares to Messrs Ed Nealon, Robert Hair and Andrew Nealon under the terms and conditions of the Ferrum Crescent Director and Senior Management Fee and Remuneration Sacrifice Share Plan (the "Plan"). The shares were issued to Messrs Ed Nealon and Robert Hair in lieu of their salaries for the period from 1 April 2012 to 30 November 2012 and to Andrew Nealon for the period from 1 September 2012 to 30 November 2012 at a weighted average price for the last 5 days prior to each month end.

The purpose of the Plan is to help align the interests of Directors and Senior Managers with those of shareholders by encouraging Director and Senior Manager share ownership and (where such shares are newly issued) preserve cash in the Company. A breakdown of each Company officer's share issue is provided below:

Following admission the Company has 328,201,385 fully paid ordinary shares in issue.

Additionally, on 14th December 2012 the Company granted 400,000 options to Mr Vernon Harvey, Chief Operating Officer. The Options were granted under the terms and conditions of the Ferrum Crescent Ltd Employee Option Plan. The Options are unquoted and granted for no consideration but will be exercisable at AUD$0.10 on or before 14th December 2015.

For more information, please visit www.ferrumcrescent.com or contact:

Competent Persons' Statement:

The information that relates to Exploration Results and Mineral Resources in the report of which this statement is a summary, is based on information compiled by Stewart Nupen, who is registered with the South African Council for Natural Scientific Professionals (Reg. No. 400174/07) and is a member of the Geological Society of South Africa. Mr Nupen is employed by The Mineral Corporation, which provides technical advisory services to the mining and minerals industry. Mr Nupen has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Nupen consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10

Consolidated statement of cash flows

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

Non-cash financing and investing activities

Financing facilities available

Add notes as necessary for an understanding of the position.

Estimated cash outflows for next quarter

Reconciliation of cash

Changes in interests in mining tenements

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

Compliance statement

1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Actor other standards acceptable to ASX (see note 5).

2 This statement does give a true and fair view of the matters disclosed.

31 January 2013

Sign here: ............................................................ Date: ............................

(Company Secretary)

Print name: Andrew Nealon................... .............

Notes

1 The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.

4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

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