LONDON MINING RECIEVES NEW LICENCE AND FISCAL INCENTIVES FOR MARAMPA IRON ORE PROJECT

* New mining lease granted of 13.82km2 confirms workable tailings and primary ore resource * Fiscal incentives and commitments package approved by Sierra Leone * Government with parliamentary ratification expected Q4 2009 * 54 hole, 6,925m drilling programme underway on primary ore body * JORC statement for enlarged tailings resource by end of 2009 * JORC statement for primary ore body by 1H 2010 * Construction to be initiated immediately after parliamentary ratification of final mining plan and fiscal incentives, with target first phase 1.5mtpa production within 12-18 months thereafter.

London Mining plc ("London Mining") announces today that it has received a new mining lease securing its key tailings and primary resource at its Marampa Iron Ore Project in Sierra Leone. In addition to the mining lease being granted, the Government of Sierra Leone (GoSL) has provided London Mining with a series of fiscal incentives that improve the economics of the project for London Mining, whilst also providing a substantial, sustainable contribution to GoSL national income. Ratification of this agreement by the Sierra Leone parliament is expected to take place during Q4 2009. Permits and permissions have also been granted to London Mining regarding its proposed truck, barge and floating crane transhipment logistics. The signing of these agreements, along with the recent settlement of outstanding boundary issues with African Minerals Limited (as reported on 21 August 2009), resolves a number of outstanding issues relating to the Marampa project and provides London Mining with the full backing of the Government of Sierra Leone (GoSL) to take the project into production. Once LM has received formal ratification from Parliament of its final mining plan and fiscal incentives, construction will be initiated immediately thereafter with first production anticipated to be within 12-18 months.

New Mining Lease London Mining Company Ltd (operating subsidiary of London Mining) has been issued by GOSL with Mining Lease 2/09 covering an area of 13.82km2 and incorporating the previously operating Marampa mine. London Mining has proposed and agreed a licence boundary which allows for practical development and operation of a tailings re-processing facility and provides the opportunity to expand operations by developing the primary ore body. The new lease area does not include extensions to two exploration targets previously drilled by the Sierra Leone Development Company (DELCO) but incorporates additional tailings resources and areas beneficial to the overall phased mining operation.

Fiscal Incentives The GoSL has also approved a package of fiscal provisions in relation to the Company's investment and start-up of operations. The main feature of the fiscal package relevant to the development stage of the project, is a reduction in import and excise duties, including that on fuel, lubricants, all capital expenditure and spare parts. These are applicable for the duration of the mining lease and are legally enforceable with immedate effect. These and all additional incentives, in relation to withholding tax, corporation tax and other operational taxes, are expected to be ratified by parliament during their next session in Q4 of this year.

Mine Development Plan Phase 1: 1.5mtpa of fine sinter feed from the reprocessing historic of tailings. Concentrate will be transported 40km by truck to a barge loading facility then 60 km by barge for transhipment in deep water.

Phase 2: Expansion to over 3mtpa of concentrate production from mining and processing of primary ore. The current 6,925m drilling programme will result in a JORC standard resource in 1H of 2010.

Graeme Hossie, CEO of London Mining plc, stated: "These agreements with the Government of Sierra Leone secure London Mining's core iron resource lease and logistics at Marampa as well as key financial parameters. We are now in a solid position to move toward first production from tailings concentration and to determine and advance the full scale of production achievable from the primary ore body. London Mining's technical expertise, financial resources and dedicated local management team, combined with the Marampa project's low capex, location and simple logistics, make our production plans highly deliverable. London Mining's Marampa project will greatly benefit the people and economy of Sierra Leone and deliver substantial value to our shareholders through its near-term cash flow and significant expansion potential. "

Rachel Rhodes, Finance Director of London Mining, said: "The new mining lease together with the package of fiscal incentives agreed with the Sierra Leone government enables the Company to meet its investment requirements to build a profitable and sustainable business in Sierra Leone. This is an exciting project which will allow the Sierra Leone economy to benefit substantially from London Mining's proposed initial USD60 million investment in the country, through job creation and significant contribution to national revenues. We look forward to parliamentary ratification of our final mine plan and fiscal package during Q4 of this year, which will enable us to commence development"

Marampa Overview The previous mine, operated by the Sierra Leone Development Company (DELCO) was in operation from 1933 to 1975 and formed a significant part of the Sierra Leone economy. The mine was briefly reopened by Austromineral, a subsiduary of Voest-Alpine, in the mid 1980s but but has not been operated since. The Company plans to construct a tailings re-processing plant at Marampa able to produce 1.5Mtpa of 66% Fe concentrate within 12 to 18 months from development commencing. The intention is to increase production to 3Mtpa or more through expansion of the tailings operation or development of the primary ore resource. Mining is expected to use conventional truck and shovel methods and/or hydraulic mining for parts of the tailings resource. Processing will employ two stages of high intensity magnetic separation.

Concentrate will be transported to barge loading facilities at Tawfayim on the Port Loko creek for shipment to deep water for loading on to Panamax or Capesize ships. The mine is located 40km from Tawfayim, of which 22km is via existing tarmac road. The remaining 18km of laterite road has been surveyed and is under construction.

Please see the full annoucement, including the agreed Marampa Lease, enclosed (or click on the link below). To read more about the Marampa project, please visit our homepage at: http://www.londonmining.co.uk/sierra-leone.aspx

For more information, please contact:

Investors

London Mining Plc Graeme Hossie, Managing Director +44 (0) 20 7201 5000 Rachel Rhodes, Financial Director Thomas Credland, Head of Investor Relations

Media

Crux Kommunikasjon (Norway) Charlotte Knudsen +47 97 56 19 59

Threadneedle Communication (UK) Laurence Read +44 (0) 20 76539850

About London Mining Founded in April 2005, London Mining is incorporated and registered in the UK. In 2007, London Mining raised over USD 185 million to advance iron ore production from its projects, and listed on the Oslo Axess, a marketplace regulated by the Oslo Stock Exchange. In 2008, it sold its Brazilian mine to Arcelor Mittal for USD810m and returned GBP220m to shareholders. The Company currently has iron ore projects and mines in China, Sierra Leone, Saudi Arabia and Greenland, and coal assets in South Africa and Colombia. London Mining trades under the Reuters symbol LOND.OL and Bloomberg symbol LOND:NO.

This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.

SOURCE: London Mining Plc

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