Operations Update

    RNS Number : 5046B
  Zeehan Zinc Limited
  18 August 2008
   

    18 August 2008

    Zeehan Zinc Limited
    ("Zeehan" or the "Company")

    The Board of Directors is pleased to provide the following updates to the market in relation to the Company's Operations in Western
Tasmania.

    Operations Update

    The Company has commenced drilling holes at its Comstock and Oceana properties with a view to identifying commercial quantities of
metals including zinc, lead, silver and nickel. Consistent with the Board's modification of strategy to focus on exploration and further
definition of the Company's resource position, the Company has ceased mining at its Comstock mine site for the time being. It is likely
mining will recommence at the conclusion of the current exploration and resource definition plan.  To clarify the operations update
announced on 28 April 2008, around 1,500 tonnes of high grade ore has been extracted and processed over the last year.  Around 620 cubic
metres of massive zinc-lead sulphide dominated materials and 4,270 cubic metres of mixed massive and disseminated zinc-lead sulphide and
waste materials have been extracted and are currently stockpiled awaiting processing and/or sale.  As stated on 28 April 2008, the Company
has entered into a sales contract for a trial amount of 500 tonnes of ore to Zinifex Australia (now trading as Oz Minerals).  Oz Minerals, together with other commercial parties continue to express interest in
purchasing product from the Company on a regular basis.  Following sale of the product currently stockpiled, the Company will likely defer
sales negotiations until it has completed its exploration and resource definition program, extracted and processed the resource. It is
anticipated that this new exploration and resource definition program will take at least six months.

    Corporate Affairs

    Following discussions with Creat Group, the Company is pleased to advise it expects to receive the remaining GBP1,100,000 of the
Convertible Note funds on or around 20 August 2008.  These funds will be primarily applied to exploration and resource definition work. In
order to finance at least part of the exploration plan (likely to cost approximately AUD2,600,000 over 12 months) the Company has engaged an
Agent to sell excess equipment which it owns on the basis that this equipment is not in and is not ideal for current use.  The Company will
hold an Annual General Meeting in Hobart, Tasmania in October or November this year, and will be distributing a Notice/Agenda, together with
the Financial Statements shortly.

    For further information please visit www.zeehanzinc.com or enquire to:

    Zeehan Zinc plc                                                      c/o Bankside
    Tad Ballantyne                                                        Tel: [phone]

    Libertas Capital                                                       Tel: [phone]
    Jakob Kinde, Aamir Quraishi

    Bankside Consultants                                            Tel: [phone]
    Simon Rothschild, Oliver Winters


This information is provided by RNS
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