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Operations and Exploration Update

18 October 2011

Mwana Africa PLC is pleased to provide an update on operations and exploration activity for the quarter ending 30 September 2011.

Highlights

• Quarterly gold production at Freda Rebecca of 13,686oz (equivalent to an annualised rate of 54,720 oz per annum), exceeded the Phase II target annualised production rate of 50,000 oz.
• Phase II monthly target production achieved three months ahead of schedule.
• Phase II tonnage build up underpinned by successful ramp up of underground production volumes.
• Mwana Chief Executive Officer, Kalaa Mpinga, commented: "I am delighted with the progress at Freda Rebecca in particular, where the Phase II production target was reached well ahead of schedule. This success is a result of the commitment and dedication of our management team. Our next objective at Freda Rebecca is to focus on operating efficiency and reliability whilst seeking to optimise plant performance."

Freda Rebecca Gold Mine

A total of 13,686 ounces ('ozs') of fine gold were produced during the quarter ending September 2011. Average monthly production for the quarter was 4,562oz (which was in excess of the Phase II target of 4,167 oz per month). Targeted production rates were therefore achieved three months ahead of schedule.

Note: figures shown are unaudited and may vary upon final audit. Gold ounces reported are exclusive of ounces attributable to gold in lock-up in the leach circuit.

During the quarter, underground expansion of load and haul capacity progressed well and has achieved the level of performance necessary to sustain Phase II production volumes. Development work and production drilling has enabled the operation to access an additional production block. This has had a positive impact on tonnage generation and in sustaining planned mill feed grade.

Head grade for the quarter was on budget. Recoveries were adversely affected by poor grinds during commissioning phase and leach tank outages which affected residence times.

As previously announced, Mill II and associated CIL/CIP circuits were completed on time and on budget and the ramp up to the Phase II target rate of production has now been achieved. The combined milling circuits have performed well and integration and optimisation of the combined feed classification systems is ongoing to improve process recoveries.

Freda Rebecca continues to engage the government of Zimbabwe on the issue of indigenization and management remains optimistic that this will be resolved.

Further information about Freda Rebecca Gold Mine can be found at: www.mwanaafrica.com/oe/zim_freda.asp

Zani-Kodo JV

Drilling continued with two rigs active during the reporting period. Twenty holes were completed in the quarter for a total of 4,957m drilled.

Drilling was carried out in the following areas (Figure 1):

• Zani Central. Drilling was completed over the 650m strike length of this target. Inclined holes were drilled to test the shallow portion of the mineralised zone.
• Kodo downdip extension. A further 'step out' drilling of 5 holes was completed to target the downdip extension of the high grade Kodo Main zone. In addition a single infill hole along the northern limit of the Kodo main zone was completed in order to fully close off mineralisation in that direction.

Results for 16 holes at Zani Central were received during the quarter and are summarised in Table 1 below:

Table 1. Assay results received from July-September 2011, Zani Central area.

The results status of Zani Central at the end of September 2011 is shown in Figure 2.

• The results indicate the continuity of a broad (12-37m) zone of low grade mineralization with narrow high grade portions locally. The mineralised zone is associated with a sheared Banded Iron Formation;
• The zone dips to the east at around 50° and is continuous along strike with 650m identified to date;
• The lack of intersections in the northernmost holes (ZNCDD002 and ZNCDD003) indicates that mineralisation has been closed off in that direction. This is interpreted to be the result of a NE trending fault;
• The zone remains completely open at depth and to the south;
• A resource calculation will be carried out once all remaining results have been received.

Kodo downdip extension

• No assay results have been received as yet;
• Visible sulphide zones with pyrrhotite and arsenopyrite are present in all holes and at the targeted depth for the extension of the high grade Kodo Main orezone;
• The best visible intersection is a 19m wide sulphide rich zone in hole KDODD063;
• An updated resource calculation for the Kodo Main zone will be carried out once results have been received;

Forward Plan

Drilling will continue on the Kodo downdip extension and will be initiated at the Gombiri target immediately south of Zani Central.

Figure 1. Zani-Kodo trend showing active drilling targets September 2011.

Figure 2. Results status, September 2011, Zani Central area.

Further information about Zani Kodo can be found at: http://www.mwanaafrica.com/oe/drc_zani.asp

Bindura Nickel Corporation

BNC's assets remained on care and maintenance for the quarter ending 30 September 2011, successfully maintaining the integrity of the assets whilst restart funding is sought.

In September BNC shareholders approved a convertible loan facility of $10m to be provided by Mwana. The loan element of the facility has been approved by the Reserve Bank of Zimbabwe. Mwana will be able to exercise the convertible element of the facility only upon a further specific approval by the Reserve Bank of Zimbabwe and the Ministry of Youth Development, Indigenisation and Empowerment. The facility allows Mwana to provide funds for the ongoing working capital requirements at BNC.

The Trojan Mine remains ready to resume production, with all the processes up to the tertiary crushers having been hot commissioned in the previous financial year. Limited development and drilling continues to be undertaken at Trojan. The mine hoisted 1,982 tonnes of waste and 3,541 tonnes of ore during the quarter as part of its care and maintenance programme. Total underground development during the care and maintenance programme stood at approximately 1,045m at the end of September 2011. The current development is targeting key priority areas included in the restart plan.

Further information about Bindura Nickel Corporation can be found at: http://www.mwanaafrica.com/oe/zim_bnc.asp

Katanga Concessions (SEMHKAT)

During the quarter exploration work concentrated on the Lunsano and Kitemena-Kitungulu areas. These areas are located in license areas PR754, PR757 and PR758 (Fig 3).

Kitemena-Kitungulu

Regional geological mapping is on-going. Regional mapping has revealed mainly rock units of the Lower Kundelungu comprising Grand conglomerat and shale units exhibiting silicification and iron-metasomatism (Fig 4).

Lunsano

The Lunsano area hosts a copper anomaly 2km by 2km in areal extent and of the size +100pm Cu. The Lunsano area overlies Roan units which have strong potential for copper mineralization.

Detailed geological mapping is on-going with the aid of trenching and pitting and the geology has been updated (Fig 5). Mapping has revealed rock units of argillaceous talcaceous shale, grand conglomerat, laminated and silicified dolomites, vuggy or stromatolitic dolomite, sandstone and ferruginous dolomitic shale. Chalcopyrite mineralization has been identified in outcrops of gossanous dolomitic shale which also underlie the Lunsano copper anomaly. The area is considered to have excellent potential for significant copper mineralization.

Kibandawepala Hill is situated in PR754 (Fig 5). This area contains a doleritic intrusion. Malachite mineralization associated with quartz veining, talc zones and specular haematite have been observed in pits. A 202.2m trench has been dug showing brecciated and highly sheared zones (talc schist) in the metadolerite. The trench has been sampled and results are awaited. The area is considered to have potential for Cu-Fe-Ni mineralization.

A total of 85 pits and 345m of trenching has been completed in Lunsano. Currently trenching is investigating the potential of the exposed units of the Mines Group (SD, RSC and RSF) to the south west of Lunsano.

Table 2. Lunsano pitting and trenching.

Regional soil sampling was carried out on a grid 1km by 400m which was then reduced to infill grids of 500m by 200m and then 200m by 50m. Sampling to date at Lusano and Kitemena-Kitungulu is summarized in Table 3. A total of 401 termite samples from the Lunsano copper anomaly have been taken.

Table 3. Summary of Sampling.

A total of 2,278 soil and termite samples have been sent to laboratory to date. A total of 199 samples from the 202.2m trench at Kibandawepala Hill have also been submitted. Samples taken from pits and trenches at Lunsano will be analysed by Niton.

A total of 977 soil sample results have been received to date and updated on plan (Fig 6).

At Lunsano the results indicate a strong copper anomaly to the south and east, thus making the dolomitic shale-conglomerate contact a potential target.

The Kibandawepala hill shows a strong copper anomaly of the size +400ppm (Fig 6) and with a peak value of 2090ppm. The results on the hill show elevated nickel and zinc values with peaks of 1350ppm Ni and 430ppm Zn. The spatial analysis of Ni and Zn content in relationship with copper content will be assessed.

Forward Plan at SEMHKAT:

• Continuation of detailed geological mapping at Lunsano;
• Continuation of regional geological mapping to the north of Kitungulu-Kitemena;
• Trench-pit sampling and trench-pit sample preparation in Lunsano to continue;
• Continuation of field data and sample results capturing and updating of plans and sections;
• Continuation of creation of new database;
• Review of potential Semhkat permits for soil sampling.

Further information about the Katanga Concessions can be found at http://www.mwanaafrica.com/oe/drc_katanga.asp

Figure 3. SEMHKAT prospect areas.

Figure 4. Kitemena-Kitungulu updated geology.

Figure 5. Lunsano updated geology.

Figure 6. Lunsano updated copper anomaly.

Klipspringer Diamond Mine

Underground recovery of the shaft bottom was completed during the period under review. The mine has been completely dewatered and cleaning the final remnants of mud and debris are almost complete.

Before the mine can start with production from the underground workings, the following work needs to be completed:

• Re-establish permanent electrical reticulation damaged during the flood;
• Seal off fissure opening where the main water course crosses the Leopard fissure;
• Install and commission main pumps at shaft bottom.

The first rains of the summer season have fallen, thereby minimizing the risk to mine property and infrastructure from veldt fires. In total 20mm have fallen and the storm water control measures implemented after the flooding incidents at the end of 2010 proved effective.

The diamond market softened somewhat during the quarter whilst the rand weakened towards the end of the reporting period. Management continues to review market conditions regularly and evaluate various options to bring the mine back into operation.

Further information about Klipspringer Diamond Mine can be found at: http://www.mwanaafrica.com/oe/sa_klipspringer.asp

Charl du Plessis, Executive Vice President Exploration of Mwana Africa, who holds a PhD and is a Member of the AusIMM, and, James Arthur, Executive Vice President Operations of Mwana Africa, Fellow of the Southern African Institute of Mining and Metallurgy, are 'Qualified Persons' as defined in the AIM Rules. The exploration and resource information contained in this report pertaining to Zani Kodo and SEMHKAT have been reviewed and verified by Dr Du Plessis, and, the resource information contained in this report pertaining to Trojan mine, Shangani mine, Hunters Road and Freda Rebecca Gold Mine have been reviewed and verified by Mr. Arthur.

Enquiries:

Mwana Africa PLC

Kalaa Mpinga
Donald McAlister
Tel: +44 (0)20 7654 5580

Nominated Adviser and Broker

Ambrian Partners Limited
Anthony Rowland / Jen Boorer
Tel: +44 (0) 20 7634 4700

Joint Broker

XCAP Securities plc
Jon Belliss / John Grant / Parimal Kumar
Tel: +44 (0)20 7101 7070

Public Relations

Merlin
David Simonson
Anca Spiridon
Tel: +44 (0)20 7726 8400