ASX Announcement - 27 October 2014

EXCITING NEW COPPER-GOLD TARGETS IDENTIFIED FROM VTEM SURVEY AT NOWA NOWA

 A recent VTEM geophysical survey flown at Nowa Nowa has identified strong conductors in areas of known copper mineralisation.

 Recommendations from geophysical consultants include ground EM and drilling in three priority areas.

 Host rocks are equivalent to those that host large copper-lead-zinc (gold- silver) volcanogenic massive sulphide (VMS) deposits in Victoria and NSW including Benambra, Woodlawn and Captains Flat.

 Previous drilling at the Three Mile prospect intersected significant mineralisation including 13.6m @ 3.8% Cu in drillhole HARD2.

Eastern Iron Limited (Eastern Iron) is pleased to report that consulting geophysicists Resource Potentials Pty Ltd (Resource Potentials) have reviewed and interpreted the results of the recently completed VTEM geophysical survey from Eastern Iron's Nowa Nowa tenement (EL 4509) in eastern Victoria. The survey was completed following a review of previous exploration and the identification of extensive Silurian volcanics believed to be the same rocks that host important volcanogenic massive sulphide (VMS) base metal sulphide deposits in Victoria and southern NSW. The survey has identified four strong, high priority conductors which Resource Potentials considers may be caused by the presence of massive sulphide deposits and have recommended follow up ground EM and drilling.

Figure 1: EL 4509 - VTEM Survey area

ABN 70 126 678 037

VTEM Survey

The VTEM or Versatile Time Domain Electro Magnetic system is an innovative and successful airborne electromagnetic system with demonstrated capacity to detect buried massive sulphide bodies (conductors) similar to those targeted by Eastern Iron within the Nowa Nowa tenement. The recent survey was flown using Geotech Airborne Pty Ltd's VTEM - Max airborne EM system with 235 line kilometres flown along east-west lines spaced 200m apart (Figure 1).
Analysis of the final VTEM data identified 25 anomalous responses and these have been ranked on the basis of shape and geological setting for each anomaly. The four highest priority VTEM anomalies have been modelled using conductor plates to fit the observed data in order to predict the target size, orientation and depth below surface of the potential source. Ground EM has been recommended for the highest priority targets in order to better define their location and orientation prior to drilling.

Figure 2: EL 4509 - Priority VTEM anomalies and rankings

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ASX Announcement - 27 October 2014

The four highest ranked VTEM anomalous areas are as follows:

Blue Spur

The Blue Spur area lies on the far northern boundary of the exploration licence. The VTEM anomaly has a strike length of over 1000m and has no known association with surface mineralisation but occurs close to a major structural contact with volcanic rocks. Ground exploration and follow up ground EM will be undertaken prior to any investigatory drilling. Eastern Iron has applied for adjoining tenements (ELs 5405 and 5530) to the north to cover potential strike extensions. This is a new target area previously unknown to Eastern Iron and represents an exciting prospect.

Three Mile

The Three Mile VTEM anomaly is around 400-500m in strike length and is coincident with a strong magnetic feature. The anomaly occurs beneath more than 50m of younger sands and conductive clays which have partially masked the EM response from the bedrock source. Previous drilling targeting the magnetic feature has been carried out on a single line to the north of the VTEM target and intersected copper, lead, zinc, gold and magnetite mineralisation in association with altered volcanics and sediments of probable Upper Silurian age. A best intersection of 13.6m @ 3.8% Cu from 195.8m was recorded in drillhole HARD2 drilled in 1991 (discussed in more detail in Eastern Iron's announcement dated 2 September, 2014). This intersection is open along strike and at depth. Ground EM will be used to better define the conductor beneath conductive overburden prior to follow up drilling.

Five Mile

The Five Mile VTEM anomaly is a wide anomaly coincident with the magnetite body drilled by Eastern Iron. It is considered unlikely that the magnetite body is the source of the VTEM anomaly and the sulphide content in the magnetite does not appear high enough to account for the VTEM response. Drilling at Five Mile has only extended to depths of around 140m to the bottom of the magnetite body and it is possible that a separate sulphide body may be present at depth below the magnetite. The magnetite body is known to have a strong copper association with the highest grade intercept being 44m @ 0.46%Cu in NRC027 (see EFE announcement June 12, 2013). Ground EM will be used to better model the shape and depth of the target conductor.

Nowa Nowa quarry

This single line VTEM anomaly is also coincident with a small magnetic anomaly and occurs immediately north of a small quarry where extensively altered (sericite - pyrite) acid volcanics have been quarried in the past. It is possible that this is a cultural feature, however, there is little of the quarry infrastructure remaining at the site and a bedrock source for the conductor is more likely. Ground EM will again be used to resolve the source.
The follow up ground EM program will be carried out once a crew can be mobilised later in the year.

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ASX Announcement - 27 October 2014

INVESTOR INFORMATION

Eastern Iron is progressing exploration for copper-gold volcanogenic massive sulphide deposits and investigating the potential for development of a high grade magnetite resource at Nowa Nowa in Eastern Victoria.
Further information, previous Eastern Iron announcements and exploration updates are available at the News and Reports tab on the Company's website - www.easterniron.com.au

Mr Greg De Ross

Chief Executive Officer

Mob: 0417 711 274

The information in this report that relates to Exploration Results, Mineral Resources and Ore Reserves is based on information compiled by Greg De Ross, BSc, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Greg De Ross is Chief Executive officer and an employee of Eastern Iron Limited 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 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr De Ross consents to the inclusion in the report of the matters based on this information in the form and context in which it appears.

ASX: EFE

For enquiries on your shareholding or change of address please contact:

Boardroom Limited GPO Box 3993, Sydney NSW 2001 Phone: (02) 9290 9600

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ASX Announcement - 27 October 2014