Central Iron Ore Limited: Drilling Commences at Perinvale South Iron Ore Hub

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 16, 2012) -

THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Central Iron Ore Ltd. (TSX VENTURE:CIO) ("CIO" or "the Company") is pleased to announce that Diamond drilling has commenced at the Walling Rock Project which is a part of the Perinvale South Iron Ore Hub. The company is planning to drill two holes in this programme.

The drilling is to provide samples for initial metallurgical test-work for this project. The test-work is aimed at prioritising the various options for upgrading the magnetite ore by a combination of magnetic separation and screening.

Yilgarn Iron Ore Project Area

The Company now has a total of 16 iron ore tenements covering 1,594km² that are located within the Yilgarn Iron Ore Province ("Yilgarn IOP") in Western Australia, of which ten tenements are granted and six tenements are pending applications. The Yilgarn IOP is considered highly prospective, given its history of large-scale iron ore production, with the Cliffs Natural Resources-owned Koolyanobbing operation (formerly operated by Portman Limited) currently producing at a rate of approximately 8Mtpa of Direct Shipping Ore ("DSO"). The Yilgarn IOP is increasingly being recognised as an attractive location for the development of iron ore, given its proximity to rail and access to ports.

Note: To view the map associated with this release, please click the following link: http://media3.marketwire.com/docs/cio0816.pdf.

QUALIFIED PERSON

Mr. Andrew Spinks B.App.Sc, Grad.Dip (Mining), a member of AusIMM, and a consultant geologist, a qualified person as defined in NI 43-101, has reviewed and approved the technical content of this announcement.

On behalf of the Board of Directors

CENTRAL IRON ORE LTD.

Brett Hodgins, President/CEO

Cautionary Note Regarding Forward-Looking Statements

This news release contains forward-looking information within the meaning of Canadian securities laws. Although the Company believes that such information is reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking information is typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking information provided by the Company is not a guarantee of future results or performance, and that actual results may differ materially from those in forward looking information as a result of various factors, including, but not limited to, the state of the financial markets for the Company's equity securities, the state of the market for iron ore or other minerals that may be produced generally, recent market volatility; variations in the nature, quality and quantity of any mineral deposits that may be located, the Company's ability to obtain any necessary permits, consents or authorizations required for its activities, to raise the necessary capital or to be fully able to implement its business strategies and other risks associated with the exploration and development of mineral properties. The reader is referred to the Company's disclosure documents for a more complete discussion of such risk factors and their potential effects, copies of which may be accessed through the Company's page on SEDAR at www.sedar.com.

ABN: 32 072 871 133