Quarterly Activities and Cashflow Report

31 January 2017

Ferrum Crescent Limited

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

Quarterly Activities and Cashflow Report

For the period ended 31 December 2016

Highlights

Moonlight Iron Project

· Desktop studies and independent metallurgical and pelletising analysis completed on new Moonlight magnetite concentrate

· Infrastructure development discussions held with Lephalale Regional Development Forum

o Shared regional development pathways assessed with other mining groups

o Infrastructure logistics under discussion include power, rail and water

o Part of the "Presidential Infrastructure Programme"

· Annual Corporate and Social Responsibility report completed and filed 

· Participation in the Lephalale Municipality schools bursary scheme

Spanish lead-zinc exploration projects

· Completion of the field geology unit for the Group's wholly-owned Toral lead-zinc project, comprising six professionals and the requisite mapping and sampling equipment

· Exploration programme commenced at the Toral project, including:-

o Structured reinterpretation and analysis of the original foreign and historic geological and exploration data

o Creation of a revised geological model incorporating existing data

o Detailed mapping and sampling over 2km of strike

o Submission for assay of 577 soil samples, 108 rock chip samples and 23 channel samples

· Generation of a highly-targeted drill plan, focused on high-grade near-surface ore shoots linking known surface occurrences to the known high-grade mineralisation at depth, for drill testing in 2017

Corporate

· £550,000 raised through a share placement with the net proceeds to be utilised for the group's general working capital purposes and the progression of its principal metals projects

· A further 769,231 new ordinary shares issued pursuant to the exercise of certain options at a price of 0.165 pence per share

· Cash balance at the end of the quarter: A$1,293,410

Post Quarter End

· As announced on 16 January 2017, Business Venture Investments No. 1709 (Proprietary) Limited ("BVI") did not complete Phase 1 of the bankable feasibility study ("BFS") in accordance with the terms of its farm-in and joint venture agreement ("Agreement") and the extended deadline of 12 January 2017. The Company, whilst reserving its rights under the Agreement, is in ongoing discussions with BVI and is considering its options in relation to the potential development of the Moonlight Project

· Further cost controls implemented in South Africa

· Laurence Read appointed as a Non-Executive Director, following Klaus Borowski's resignation as a Non-Executive Director to pursue other interests

Exploration Interests

The following information is provided in accordance with ASX Listing Rule 5.3 for the quarter ended 31 December 2016:

1. Listing of tenements held:

No tenements were disposed of or acquired during the quarter.

Justin Tooth, Executive Chairman of Ferrum Crescent, today commented:

"The final quarter of 2016 was a pivotal point for the Company as we began exploration activities at our newly acquired Toral lead-zinc project in Northern Spain. With a dedicated Project Manager, Merlin Marr-Johnson, and a fully-equipped field geology team now in place, we have swiftly progressed our planned work programme, including the recent submission of over six hundred soil, rock chip and channel samples for assay and the generation of our Phase One drill plan.

"In South Africa, we continue to assess options for the potential development of the group's Moonlight Project, whilst at the corporate level most recently we were pleased to welcome Laurence Read to the Board and to wish Klaus Borowski well in his retirement. We now have a strong team in place and I look forward to updating the market on our operational progress in due course."

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

Ferrum Crescent Limited

Justin Tooth, Executive Chairman

Grant Button, Company Secretary

T: +61 8 9474 2995

UK enquiries:

Laurence Read (UK representative)

T: +44 7557 672 432

Strand Hanson Limited (Nominated Adviser)

Rory Murphy/Matthew Chandler

T: +44 (0)20 7409 3494

Beaufort Securities Limited (Broker)

Elliot Hance

T: +44 (0)20 7382 8300

Bravura Capital (Pty) Ltd (JSE Sponsor)

Doné HattinghT (direct): +27 11 459 5037

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014.

APPENDIX 5B:

http://www.rns-pdf.londonstockexchange.com/rns/5544V_-2017-1-31.pdf

Notes to Editors:

Further Information on the Spanish lead-zinc Exploration Projects

Toral Project

The wholly owned Toral zinc-lead-silver permit is located near Ponferrada in the west of the province of León, Autonomous Community of Castile and León, Spain approximately 400km northwest of Madrid.

The Toral Project has been extensively explored historically by its previous owners Portex Minerals Inc. and Lundin Mining S.L. and the 2,024ha of mineral rights contains extensive high grade zinc mineralisation. Located in north-west Spain, approximately 400km north-west of Madrid, the project's licence area hosts excellent road, rail and power infrastructure and is situated in a known historic mining jurisdiction. The asset also has a pre-existing NI 43-101 resource estimate reported by Micon International Co. Limited on 30 April 2012 (the "NI 43-101 Report"). The NI 43-101 Report estimated that the project has a NI 43-101 compliant Inferred and Indicated foreign resource estimate of 8.71Mt at an economic cut-off grade of 7% Pb + Zn (as set out in the Company's announcement of 10 November 2016).

Lago Project

The Lago Project is located approximately 54km to the north-east of the Toral Project. Historical investigations completed by or on behalf of the Spanish mining firm, Exploracion Minera International Espana S.A. ("EXMINESA"), between 1985 and 1990, indicated that mineralisation at the Lago Project may be similar to that encountered at the Toral Project with vertical, lenticular bodies (probably more than one) approximately 800m long by 300m wide.

2016 Spanish work programme overview

· Analysis and re-interpretation of existing historic data on the Company's Spanish Exploration Projects commenced in September 2016.

· Planned work programme comprises:

o re-mapping of the main Toral Project area applying re-interpreted historical geological understanding of the regional controls on mineralisation;

o in-fill surveys over the main prospect area where detailed soil geochemistry has not previously been conducted;

o structural mapping of the existing adits, outcrop and the nearby mineralisation occurrences in order to gauge the balance between local (not fully tested) and regional (well documented) controls on mineralisation;

o re-logging of historical drill-core and re-assaying of areas where incomplete assays were taken previously in order to seek to identify potential new shallow high grade targets at the Toral Project;

o creation of a revised geological model incorporating existing and new geological data (geochemistry, structural interpretation, assays, logs, maps); and

o generation of a highly targeted drill plan, focused on high-grade near surface ore shoots linking known surface occurrences and known high-grade mineralisation at depth, for testing in 2017.

Further Information on the Moonlight Project, South Africa

Ferrum Crescent's Moonlight Iron Project is located in Limpopo Province in the north of South Africa. The Moonlight Deposit (upon which the Project is based) is a magnetite deposit located on the Moonlight, Gouda Fontein and Julietta farms and is the main operational focus for the Company. Iscor Limited ("Iscor"), which explored the Project in the 1980s and 1990s, reported mineralisation capable of producing a concentrate grading at 68.7% iron. At that time, Iscor concluded that the deposit, which was described as being comparable to the world's best, was easily mineable due to its low waste-to-ore ratio. The beneficiation attributes of Moonlight ore are extremely impressive, with low-intensity magnetic separation considered suitable for optimum concentration.

Metallurgical tests on Moonlight material, undertaken since then by Ferrum Crescent, suggest that Iscor's historical results are conservative, that good metal recoveries can be achieved, and that the resulting concentrates have a high iron content and only negligible impurities, at grind sizes considered to be industry standard (P80 of 75 - 125 microns).

Key features of the project to date are:

· JORC (2012) compliant Mineral Resource;

· Historical drilling, drilling by the Group, geological modelling and a high density geophysical survey conducted by the Company in 2012 confirm tonnage upside potential;

· 30 year Mining Right granted;

· Environmental licence (EIA) in place for the Moonlight mining area (approved 4 April 2013);

· Metallurgical test work indicates the potential for high quality concentrate and/or pellets with in excess of 69% iron content and low deleterious elements (DR grade pellets for use in direct reduction iron/electric arc steel-making processes);

· The quality of product that can potentially be produced at Moonlight is a clear differentiator against its industry peers, as is the access to infrastructure (port, power and rail);

· Duferco offtake partner (4.5 Mtpa plus first right on a further 1.5 Mtpa if not sold domestically). South Africa currently has a growing demand for high grade iron concentrate and/or pellets for its steel industry;

· Located near Kumba railhead at Thabazimbi (Kumba operation depleting in grade), Limpopo Province, northern South Africa;

· New Eskom power plant (4,800MW) commissioning first 800MW module;

· Richards Bay port expansion for potential export of future iron ore products; and

· Local community, Ga-Seleka, has an effective 3% carried interest in the Moonlight Project.