Positive Test Results Confirm DRI Product Quality

Zanaga Iron Ore Company Limited (AIM: ZIOC) is pleased to announce positive outcomes from its recent metallurgical test work programme, confirming the ability to produce Direct Reduction Iron ("DRI") grade pellet feed concentrate product from the Zanaga Iron Ore Project (the "Zanaga Project" or the "Project"), capable of supplying the rapidly growing low carbon Electric Arc Furnace ("EAF") steel sector.

Key Highlights

• Product test work results from both hematite and magnetite orebody lithologies met stringent DRI quality requirements critical for the rapidly growing EAF steel sector:

o Hematite concentrate grade results: 68.5 %Fe, 1.05 %SiO₂, 0.47 %Al₂O3, 0.034 %P

o Magnetite concentrate grade results: 69.1 %Fe, 1.96 %SiO₂, 0.40 %Al₂O3, 0.028 %P

• Test work results represent a significant improvement in planned product quality versus the 2014 Feasibility Study, particularly in the reduction of impurities (gangue minerals)
• DRI product quality confirmation further reinforces the strategic nature of the Zanaga Project
• The Company is in process of completing an evaluation of the Net Present Value ("NPV") upside of its planned DRI product - the results of this will be announced shortly

Martin Knauth, CEO of ZIOC, commented:

"Our achievement of enhanced DRI product quality provides a positive base for our ongoing value engineering work, including completing a feasibility study of a DRI grade pellet plant which would provide further optionality to enhance value by converting Zanaga's pellet feed concentrate into premium quality DRI pellets.

I look forward to updating shareholders shortly on the value upside potential of today's results, and on the progress across our key project workstreams as we work to further actualise the extensive potential of the Project."

Clifford Elphick, Chairman of ZIOC, commented:

"These encouraging metallurgical results further reinforce our confidence in the Zanaga Project's ability to produce premium-quality iron ore at large scale. Achieving DRI grade product quality is a critical step toward enabling the Zanaga Project to supply the rapidly growing Electric Arc Furnace steel producers, positioning the Zanaga Project strategically in the evolving global iron ore market landscape."

Strategic Importance

DRI grade product holds significant importance in modern steel manufacturing due to its high purity and role as a feedstock into EAFs which offer a more cost-effective, and more environmentally friendly steel production alternative to traditional blast furnace methods. EAFs require lower capital investment and maintenance; they can be installed and operated with significantly lower upfront costs, using electricity instead of expensive and environmentally harmful coking coal as the primary energy source, and can operate under lower thermal stress, which reduces maintenance frequency and costs over time. The advantages of employing this production method give projects that can deliver DRI grade pellet feed concentrate a substantial market opportunity.

Accordingly, the achievement of DRI product quality test results is a significant milestone for the Zanaga Project, positioning the Company to potentially capitalise on the rising global demand for premium quality, low carbon footprint steel products. The successful results from both hematite and magnetite samples validates the robustness of the Zanaga Project's planned processing approach. The ability to consistently produce high grade DRI pellet feed concentrate, suitable for DRI pellet production to supply EAF steel customers, provides a clear competitive advantage and highlights the Zanaga Project's investment appeal to strategic and financial investors, whilst contributing to sustainable steelmaking and aligning with global efforts to reduce industrial carbon footprints.

Overview of test work and results

During Q2 2025, the Company commissioned and completed a metallurgical laboratory test work programme aimed at determining the ability of the Zanaga Project to produce DRI grade pellet feed concentrate across its full 30 million tonnes per annum ("Mtpa") planned production scale, including both Stage One (12Mtpa) and Stage Two (18Mtpa expansion).

Representative samples of the Zanaga Project resource were assembled from both hematite and magnetite orebody lithologies, required for the Stage One and Stage Two phases of the Zanaga Project respectively.

The primary test work programme was conducted in China, involving comprehensive laboratory analyses, employing magnetic separation and flotation processes. Adjustments to the Zanaga Project's planned flow sheet resulted in the optimisation of process step configuration and, in some cases, replacement of certain processing equipment in the original flow sheet. ZIOC's team of expert technical consultants have guided that there should be no expectation of any significant change to capital and operating costs as a result of the changes to the flow sheet.

A summary of the test results is provided below:

Following the achievement of the positive results above, a separate independent confirmatory test work programme was completed in the United Kingdom, utilising a separate sample of the two orebody lithologies. The results from this confirmatory work validated the test work results conducted in China.

The Zanaga Project DRI test results fall squarely within or ahead of industry benchmarks for DRI feed. Both its hematite and magnetite concentrates have demonstrated to exceed the minimum DRI feed requirement of 66%-67%Fe, have low gangue (SiO₂ + Al₂O3) and ultra‐low impurities - highlighting their full technical compliance for DRI grade product quality.