St George's Terrace PERTH WA 6000

By Email: [email protected]

[email protected]

BC Iron Limited - Response to ASX Price and Volume Query

We refer to your query letter dated today, 5 July 2016, in relation to the change in BC Iron Limited's (the Company) securities from a closing price of $0.11 on Thursday 30 June 2016, to an intraday high of $0.175 today, 5 July 2016, and in an increase in the volume of trading in that period.

Our responses to the questions set out in your letter are as follows:

No, the Company is not aware of any information that would be required to be announced under the ASX Listing Rules that has not previously been announced.

Not applicable.

No, the Company is not aware of any explanation for the change in the trading of the Company's securities. However, the Company does note that there has been a slight increase in the iron ore spot price and forward curve in the relevant period. Further, in line with the March 2016 Quarterly Report released on 21 April 2016, the Company continues to consider all strategic options in relation to its interest in the Nullagine Joint Venture.

The Company confirms that it is in compliance with the Listing Rules, and in particular, Listing Rule 3.1.

Yours sincerely

Hayley McNamara

Company Secretary

BC Iron Limited ABN 21 120 646 924

Level 1, 15 Rheola Street West Perth WA 6005

GPO Box 2811

West Perth WA 6872

T +61 8 6311 3400

F +61 8 6311 3449

E [email protected] W www.bciron.com.au

5 July 2016

Ms Hayley McNamara Company Secretary BC Iron Limited

By email

Dear Ms McNamara

BC Iron Limited (the "Entity"): ASX Price and Volume Query

We have noted a change in the price of the Company's securities from a closing price of $0.11 on Thursday, 30 June 2016, to an intraday high of $0.175 today, 5 July 2016. We have also noticed an increase in the volume of trading in the Company's securities over this period.

In light of the price increase, ASX asks you to respond separately to each of the following questions:

Is the Entity aware of any information concerning it that has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities?

If the answer to question 1 is "yes":

Is the Entity relying on Listing Rule 3.1A not to announce that information under Listing Rule 3.1?

Please note that the recent trading in the Entity's securities would suggest to ASX that such information may have ceased to be confidential and therefore the Entity may no longer be able to rely on Listing Rule 3.1A. Accordingly, if the answer to this question is "yes", you need to contact us immediately to discuss the situation.

Can an announcement be made immediately?

Please note, if the answer to this question is "no", you need to contact us immediately to discuss requesting a trading halt (see below).

If an announcement cannot be made immediately, why not and when is it expected that an announcemant will be made?

If the answer to question 1 is "no", is there any other explanation that the Entity may have for the recent trading in its securities?

Please confirm that the Entity is in compliance with the Listing Rules and, in particular, Listing Rule 3.1.

ASX Compliance Pty Limited

ABN 26 087 780 489

Level 40, Central Park

St George's Terrace Perth WA 6000

www.asx.com.au Customer service 13 12 79

T 61 8 9224 0000

When and where to send your response

This request is made under, and in accordance with, Listing Rule 18.7. Your response is required as soon as reasonably possible and, in any event, by no later than 3:30 pm (WST) today, 5 July 2016. If we do not have your response by then, ASX will have no choice but to consider suspending trading in the Entity's securities under Listing Rule 17.3.

You should note that if the information requested by this letter is information required to be given to ASX under Listing Rule 3.1 and it does not fall within the exceptions mentioned in Listing Rule 3.1A, the Entity's obligation is to disclose the information "immediately". This may require the information to be disclosed before the deadline set out in the previous paragraph.

ASX reserves the right to release a copy of this letter and your response on the ASX Market Announcements Platform under Listing Rule 18.7A. Accordingly, your response should be in a form suitable for release to the market.

Your response should be sent to me by e-mail at [email protected] and [email protected]. It should not be sent directly to the ASX Market Announcements Office. This is to allow me to review your response to confirm that it is in a form appropriate for release to the market, before it is published on the ASX Market Announcements Platform.

Listing Rule 3.1

Listing Rule 3.1 requires a listed entity to give ASX immediately any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity's securities. Exceptions to this requirement are set out in Listing Rule 3.1A.

The obligation of the Entity to disclose information under Listing Rules 3.1 and 3.1A is not confined to, nor is it necessarily satisfied by, answering the questions set out in this letter.

In responding to this letter, you should have regard to the Entity's obligations under Listing Rules 3.1 and 3.1A and also to Guidance Note 8 Continuous Disclosure: Listing Rules 3.1 - 3.1B.

Trading halt

If you are unable to respond to this letter by the time specified above, or if the answer to question 1 is "yes" and an announcement cannot be made immediately, you should discuss with us whether it is appropriate to request a trading halt in the Entity's securities under Listing Rule 17.1.

If you wish a trading halt, you must tell us:

• the reasons for the trading halt;

• how long you want the trading halt to last;

• the event you expect to happen that will end the trading halt;

• that you are not aware of any reason why the trading halt should not be granted; and

• any other information necessary to inform the market about the trading halt, or that we ask for.