Zambezi Resources Limited : ZRL Copper Project Approved (EIS)

ASX Announcement

20 January 2014

ZAMBEZI RESOURCES COPPER PROJECT APPROVED BY THE ZAMBIAN GOVERNMENT TO PROCEED

Zambezi Resources Ltd (ASX:ZRL) ("Zambezi" or "the Company") is pleased to announce that the Minister of Lands, Natural Resources and Environmental Protection has formally overturned the Zambia Environmental Management Agency's (ZEMA) rejection of our Environmental Impact Study ("EIS") and given the green light for Zambezi Resources Ltd to proceed to develop its 100% owned Kangaluwi Copper Project in Zambia. (See attached letter from the Zambian Government dated 17
January 2014).
Zambezi Chairman, Mr David Vilensky commented:

"The Company welcomes the Zambian Government's decision to allow its Kangaluwi Copper Project in the Lower Zambezi National Park to proceed to development. Securing formal approval of the EIS represents a major milestone for the Company as we can now take steps and proceed to take the Kangaluwi Copper Project to the development stage and become an emerging producer.

I compliment the Zambian Government in allowing the Kangaluwi Copper Project to proceed within the National Park as part of its revised Mineral Resources Development Policy which seeks to strike a fair balance between the benefits of mining and the protection of the environment and wildlife conservation, provided its policies and laws are respected and adhered to and such investments will create employment opportunities for ordinary Zambians."

The Kangaluwi Copper Project, east of Lusaka (capital of Zambia) will open a new copper province. Zambezi has, since the commencement of exploration in 2004 confirmed to-date a JORC resource of
308,000 t of copper metal of which 50,000 t is the oxide resource with only 20% of the mining licence exploration targets drilled. Zambezi now holds a valid mining licence for 25 years and with the granting of the EIS the Company will now be finalising its feasibility studies in order to become a
copper producer in the near term.

20.01.14 ZRL Announces Formal Approval of its EIS in relation to KCP

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About the Kangaluwi Copper Project:

Zambezi Resources Limited is an ASX listed Copper Exploration and Development Company focused on its 100% owned Kangaluwi Copper Project, 180 km east of Lusaka, Zambia. The project is covered by a 245 km2 Mining Licence area ML 15547, issued on 16 March 2011 and valid for 25 years. The project covers the high quality copper deposits of Kangaluwi, Chisawa and Kalulu.

Table 1: Kangaluwi Copper Project Mineral Resource Estimate Reported at a Range of Cut-off Grades

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Numerous geophysical targets in the project area are yet to be evaluated, with only 20% of the
exploration target tested to date.
Structural modelling of mineralisation by independent consultant Dr Alexei Sokolov reveals significant additional exploration upside at the Kangaluwi Copper Project (previously announced on 25
September 2012). The report outlines an initial exploration target1 of 100 Mt - 160 Mt @ 0.5% - 0.7% Cu.

Figure 1: Mining Licence 15547

1 The estimates of Exploration Target sizes should not be misunderstood as estimates of Mineral Resources. The estimates of Exploration Target sizes are conceptual in nature and there has been insufficient results received from drilling to dat e to estimate a Mineral Resource in accordance with the JORC Code (2004). It is uncertain if further exploration will result in the determination of a Mineral Resource.

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Competent Persons Statement

The information in this report relating to Mineral Resources was compiled by Mr Dean Carville who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Carville is a full-time employee of AMC Consultants Pty Ltd and has sufficient experience 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 (the JORC Code). Mr Carville consents to the inclusion of this information in the form and context in which it appears.

The information in this announcement that relates to exploration/conceptional targets is based on information compiled by Dr Alexei Sokolov, Exploration Consultant. Dr Sokolov was engaged by Zambezi Resources as a Consultant and is also a member of the Australasian Institute of Mining and Metallurgy and 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". Dr Sokolov consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Frank Vanspeybroeck

Managing Director

Zambezi Resources Limited

Tel: [phone]

Email: [e-mail]

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Ttltphone: 25228812S0186

fu: 253522 8

REPllBLIC OF ZAMBlA

ftr rt>ply p/ease quote·

N.o.••••..M••.L../..1...0.2.•/..2..•/..1.•

lllISTRl Ot' LANDS, N;TllRAL RESOrltCES AND. EIVIRON IEJ'JTAL PHOTECTION

OI<'FlCt OFTHE HO:OURABLE:1-UN1STF.R

P.O.BOX 50694

17'h January 2014 15101 RJDGF.WAY

The Managing Director Mwembeshi Resources Limited P.O.Box 50395

Pio!56697.Beu Cresent

Kalundu

LUSAKA

Dear Sir,

RE: APPEAL AGAINST THE REJECTION BY ZEMA OF THE PROPOSED LARGE SCALE MINING ACTIVITIES UNDER UCENCE NO. 15547-HQ-LML MWEMBESHI RESOURCES LIMITED IN LUANGWA DISTRICT

l mal reference to the above mentioned svbject. Reference is also mode to yovr appeal letter dated 19 September 2012 and to the voriovs meetings and hearings, too nvmerous to itemize, held between your selves. ZEMA and the Ministry of Lands, Natura! Resovrces ond EnvironmentalProtection.

l have considered carefully yovr svbmitted grounds of appeal against ZEMA'S rejection. l have olso carefully considered eoch and every ground of rejection given by resolution of the ZEMA Boord.

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In exerdse of the powers conferred on me by Sections 115 subsections L 2 and

3. of the Environmental Management AclNo. 12 of 2011. l have decided to approve the project.on the following grounds:

A) The projecl should go aheod becouse it will eventually create employmenlfor ordinory Zombions in the areo.

B) There ore currently avoiloble cosieffective technologies ond melhods lo

adequotely oçklress oli the identified negative impacts thot moy arise from the projeçt.

C) Wild life monaQement in fhe area will be enhanced ond conser ved by

the proposed monoged scheme contoined in your submissions.

By copy of fhis lelter, you are lo liaise with ZEMA for them to issue o Decision

LeIter wilh alllhe appropriate conditions under which fhe project will operate. Yours faithtully,

(q - (/

Hon.Har abo, M.P.

R OF LANDS NATURAL RESOURCES ANO ENVIRONMENTAL PROTECTION

cc: Permonent Secretary

MINISTRY OF LANDS,NATURAL RESOURCES ANO ENVIRONMENTAL PROTECTION.

cc: ZEMA Boord Choirperson cc: Director Generai-ZEMA

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