CZR RESOURCES LTD — Interim / Quarterly Report 2013

Jan 30, 2014

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Coziron Resources Limited

ABN: 91 112 866 869 Level 24, 44 St George’s Terrace Perth Western Australia 6000 PO Box Z5183 Perth WA 6831 Phone: +61 8 6211 5099 Facsimile: +61 8 9218 8875 Website: www.coziron.com

The Company Announcements Office ASX Limited Via E Lodgement

31 Jan 2013

Quarterly Activities Report to 31 December 2013

HIGHLIGHTS

Yarraloola Project – West Pilbara

• Priority prospects for direct-shipping iron-ore and opportunities for large-scale magnetite deposits in proximity to transport infrastructure which will service the new multi-user port at Cape Preston east are being advanced as drill-targets.

Buddadoo Project – Midwest Region

• Priority prospects for copper-gold mineralisation have been identified for drilling.

KingX Project – Earaheedy Basin

• Targets for manganese and base-metal mineralisation are being reviewed and follow-up field programmes are being generated.

Corporate

Company Background

In September 2012, Coziron Resources Ltd (ASX: CZR) acquired the Yarraloola Iron-Ore Project in the West Pilbara, Buddadoo Iron-ore Project in the Midwest and the KingX Manganese Project in the Earaheedy Basin of Western Australia from Creasy Group (Fig 1). CZR has exploration focused on commodities used in the steel-making but is assessing prospectivity for other metals as part of the exploration process.

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Fig.1 Location of the Coziron Resources Ltd projects in Western Australia along with the new Shepherds Well Project in the West Pilbara.

Exploration Activities and Results

Yarraloola Projects – West Pilbara

The Shepherds Well Project, which CZR has an option to acquire, and the contiguous Yarraloola Projects are well-located with bitumen-road access from the Northwest Coastal Highway and are proximal to a new public access port being developed by Iron-Ore Holdings Ltd at Cape Preston East (Fig 2). The CZR tenement package is located within a region which hosts well-established direct-shipping iron-ore operations and developing magnetite mining and processing operations.

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Fig 2. Location and infrastructure setting of the Yarraloola and Shepherds Well (CZR) Iron-Ore Projects in the West Pilbara, Western Australia. Other major tenement holders in the region are RioTinto Ltd (LTD), Fortescue Metals Ltd (FMG), Iron-ore Holdings Ltd (IOH), Mineralogy Pty Ltd (Mineralogy).

Results

In the past quarter CZR has progressed a targeting programme on the tenement package selecting prospects for detailed ground-work with a focus on generating prospects for drilling (Fig 3). The prospects have been subdivided into three categories.

1. Outcropping channel-iron mineralisation (CID).

2. Palaeo-channel systems with the potential to host CID.

3. Goethite-haematite mineralisation associated with banded iron-formation.

4. Magnetite-rich iron formation.

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The CID and goethite-haematite systems are priority prospects for exploration because they represent opportunities for direct-shipping ore. The CID-mineralisation, in particular, is a high priority target because the Yarraloola tenements are located immediately adjacent to the Mesa A and Mesa J mines operated by RioTinto Ltd, along with deposits being brought into production by Iron-ore Holdings Ltd and the Redgate and Whitegate ore-resources owned by Red Hill Mining. CZR has selected access-ways to potential drill-sites and has received works approvals from the WA Department of Minerals. However, before any ground disturbance can commence, a Heritage clearance and approval programme will be required with the traditional owner group.

The second priority is the palaeo-alluvial systems with the potential to host CID. The plan is to undertake a programme of ground-based gravity and magnetic surveys prior to the finalisation of drill-targets. The geophysical programmes should provide greater control on establishing the traces of palaeo-channels and perhaps identify intervals with a higher potential for the accumulation of the pisolitic iron-ore mineralisation. The advantage of both the ground-based gravity and magnetics is that the results can be rapidly integrated into a planning programme for drilling.

The targeting of high-grade, fault-associated, goethite-haematite mineralisation is a relatively new style of prospect being developed by CZR for Yarraloola. The mineralisation model involves more localised by potentially higher-grade material in response to hydrothermal fluid-flow. It is an alternative to historical work which focussed exploration on mineralisation located in the keels of regional synclines. It has evolved from CZR mapping and rock-chip sampling of outcrops with Fe>55% located along the traces of some of the major regional structures. Reconnaissance drill-sites have been selected but require a site visit to finalise the drill-locations. Once the plan is finalised, programmes of works and heritage clearance proposal can be generated.

Magnetite prospects represent large-scale, low-risk drill opportunities. The initial targets are focussed on outcropping sections of the Ashburton Trough iron-formation. Field mapping indicates the rocks in the Ashburton Trough are typically coarser grained than units in the adjacent Hamersley Basin which may be advantageous for magnetite recovery. This area is also proximal to the haul-road access being developed by Iron-ore Holdings. Drilling is required to establish the magnetite tenor, grains-size, tenor and the general metallurgical characteristics of the iron-rich rock-types in the sequence. Reconnaissance drill-sites have been selected but these require a site visit to finalise the drill-locations. Once the plan is finalised, programmes of works and heritage clearance proposal can be generated.

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Fig 3. Yarraloola and Shepherds Well Projects showing the regional geotectonic setting, the CIDtargets and subdivision of iron formations in the Hamersley Basin and Ashburton Trough by magnetic properties.

Buddadoo Project

The Buddadoo project (E59/1350) is located in the Mid-west region of Western Australia towards the western margin of the Yilgarn Craton (Fig 5). The tenement covers part of the Gullewa Greenstone Belt and adjacent mafic and felsic intrusive systems. Reported mineralisation on the tenement includes bands of vanadiferous titanomagnetite in gabbro in the Buddadoo Range and copper and gold associated with felsic volcanics at Edamurta. The Edamurta system has been targeted historically as a potential site for volcanic hosted massive sulphides. These high-value deposits are typically characterised by relatively short strike-lengths (<200m) but strong down-dip extent.

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Fig 5. Geological setting of the Buddadoo Project which covers part of the Gullewa Greenstone Belt that is intruded by the Buddadoo Mafic Complex and disrupted by adjacent granites.

Results

During the quarter CZR has advanced the planning of fieldwork for the coming season. There are high priority targets for copper and gold which require infill sampling and mapping to finalise potential sites for drilling at Edamurta in the northern part of the tenement. Mineralogical work has also confirmed that the V-Ti-mineralisation in the Buddadoo Range is dominated by titanomagnetite which is the favoured phase for metallurgical recovery. However, additional drilling will be required to recover fresh material for a metallurgical testwork programme.

KINGX PROJECT

This project consisting of 4 granted and 6 pending licences with a total area of 3000km[2] is located about 130km north-east of Wiluna and is prospective for manganese mineralisation in the Earaheedy Basin. The manganiferous outcrops are consistently located in an interval above pelletal iron-formation and towards the base of an overlying sequence of carbonates. This style and setting of the mineralisation is similar to the Kalahari Basin in southern Africa which hosts the World’s largest accumulations of manganese. The region is also regarded as being prospective for sediment-hosted copper and other base-metal mineralisation.

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Fig 6. Geology of the Earaheedy Basin showing the location of the KingX tenements and a surface trace of the manganese-prospective horizon in dark blue.

Results

During the quarter CZR has advanced the planning of fieldwork for the coming season. There are high priority targets for manganese and base-metal mineralisation which require infill sampling and mapping to finalise potential sites for drilling. Work plans, budgets and work schedules are being prepared over a number of priority targets.

FUNDING

The Company entered into a non-binding mandate during December 2013 for the provision of an initial investment of $2m by 31 January 2014 and a further $2m by April 2014. Unfortunately these funds have not yet been received by Coziron owing to delays in the international transfer of funds. The provider of the funds has expressed their commitment to the mandate and the Company remains optimistic that the funds will be received shortly. However, the Directors have prudently commenced discussions with further parties to provide funding should this funding not be forthcoming.

During the last 12 months the Company has been in discussion with several strategic funding parties who had expressed a strong interest in investing in Coziron, particularly in the Yaraloola iron ore project in the Pilbara. Unfortunately with the change in market sentiment in relation to resources projects, and in particular those at an early stage, we were advised during the December 2013 quarter that these parties no longer wanted to invest in the Company. This was a particularly disappointing outcome as the Directors had delayed other funding initiatives on the strength of the interest shown. The Directors remain optimistic that adequate funding to enable the Company to continue the exploration of its project areas will be obtained.

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COMPETENT PERSONS STATEMENT

The information in this report that relates to mineral resources and exploration results is based on information compiled by Rob Ramsay (BSc Hons, MSc, PhD) who is a Member of the Australian Institute of Geoscientists. Rob Ramsay is a full-time Consultant Geologist for Coziron 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”. Rob Ramsay has given his consent to the inclusion in this report of the matters based on the information in the form and context in which it appears.

SCHEDULE OF MINING TENEMENTS

Area of Interest
Buddadoo, Western Australia
Nature of interest	Direct
Interest	85%
Tenement Number	E59/1350
Yaraloola, Western Australia
Nature of interest	Direct
Interest	85%
Tenement Number	E08/1060
	E08/1684
	E08/1685
	E08/1686
	P08/529
	P08/530
	E08/1824
	E08/1825
	E08/1826
	P08/666 (100%)

Kingsland, Western Australia

Nature of interest	Direct
Interest	85%
Tenement Numbers	E38/2213
	E38/2212
	E53/1433
	E53/1437
	E38/2211
	E53/1434
	E53/1435
	E53/1436
	E53/1622
	E53/1623
	E53/1624
	E69/2573

Tenements Acquired

Tenements Acquired
		Nature of
Area of Interest		interest	Interest
Yaraloola
Kalgoorlie, WA	P08/666	Direct	100%

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