ASX / MEDIA RELEASE                                                                            

5 November 2008

Indo Mines Secures Contract of Works for Liquid Iron Project

?         Indo Mines secures highest Indonesian Government approval for Liquid Iron Project

?         First such approval granted for more than ten years

?         Scoping Study being updated to reflect the substantial increase in liquid iron pricing and its impact on the Project?s NPV and IRR

?         Feasibility study well underway

The Board of Indo Mines Ltd (ASX:IDO) is pleased to advise that the Company has received a Government approved Contract of Works to develop its Jogjakarta Liquid Iron Project (?the Project?). This Mining Licence is the highest level of approval required for development of the Project, and provides long-term security of tenure. This is a major milestone and step toward production for Indo Mines and the Project has the potential to become one of the lowest cost liquid iron producers in the world.

Indo Mines is developing a US$600 million, one million tonne per year liquid iron project at Jogjakarta, on the Indonesian Island of Java. In September 2006 the Company identified a JORC compliant mineral resources of 605 million tonnes (refer ASX Release dated 27 September 2006), the initial focus being the 273 million tonne surface sand unit down to a maximum depth of 9 metres.

A Scoping Study completed by Promet Engineers has identified that the simple shallow mining operation, the availability of low cost thermal coal required for the reduction process and the processing facility being located on the mine site adjacent to existing rail and power infrastructure resulted in operating costs of approximately US$150/tonne of pig iron. The proven liquid iron processing technology is based on Bluescope Steel?s New Zealand Glenbrook Facility, which has been in operation for more than 30 years. Promet are currently updating the Scoping Study to ascertain the improvement in project financials based on the significant increase in the price of liquid iron from US$300 to more recently traded pricing of US$500-US$600 per tonne.

The Contract of Works is the first of its type to be granted to an international company in more than ten years, and the first ever to be granted in Java. The Contract of Works is a binding agreement with the Government of Indonesia and is protected by International law.

Indo Mines Managing Director Phil Welten said this was a major achievement for the company.

?This is a significant step forward; Indo Mines has been working closely with the Indonesian Government, local communities and other stakeholders for more than three years to reach this point. Receipt of this level of approval is a key to securing foreign investment support and allows us to proceed with full confidence to the next phase of development, and the completion of our feasibility study by the second half of 2009.

?Located in Indonesia we have on our doorstep a major market for liquid ?pig? iron, where at the moment 95% of product is imported for domestic use.

?We have had strong local, regional and central support in the development of this Project, which reflects the approach we have taken, and the strategic importance of this liquid iron project to the local and national economy,? Mr Welten said.

The Company has already installed a pilot plant on site that is being used to generate test samples and to demonstrate the simple mining techniques, concentrator process steps and rehabilitation of the mining areas in preparation for agricultural use. Development and approval for the project has been facilitated by the fact that it does not involve significant environmental or forestry issues.

Concentrator Pilot Plant

The Company believes the Project represents a low risk, low cost mining and hot metal processing operation with extensive resource and marketing potential.

The Project will provide significant investment into the local and regional economy, providing thousands of jobs and supporting community infrastructure. Indo Mines has consulted closely with communities in the region, and has already established a system of compensation for farmers during mining, and a community program to allow for site improvement after rehabilitation.

For more project information, please contact admin@indomines.com.au or visit the site www.indomines.com.au.

Phil Welten

Managing Director

Telephone: +61 8 9322 6322

Purple Communications

Caroline de Mori +61 418 919 064

About Indo Mines

Perth based Indo Mines? primary focus is the Jogjakarta Liquid Iron Project in Java, Indonesia. The project is based on a JORC iron sands mineral resource of 605 million tonnes and a mine life of at least 30 years. Indo Mines is targeting a substantial increase in potential tonnage across its iron sands tenements to further expand the design capacity of 1 million tonnes of pig iron per annum into the significant local iron market. The Company has an experienced Board and Management team, with proven project development skills in the iron ore sector.

The information in this report that relates to Exploration Results and Mineral Resources of the Jogjakarta Liquid Iron Project is based on information compiled by Mr Philip Welten, who is a member Australian Institute of Mining and Metallurgy. Mr Welten is a full-time employee of Indo Mines Limited. Mr Welten has sufficient experience, which is relevant to the style of iron ore 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 2004 Edition of the ?Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves?. Mr Welten consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

***

The new Spam Act commenced on 10 April 2004. This Act is aimed at reducing the amount of unauthorised emails you receive. You have been receiving e-mails

containing information and news releases from us on behalf of our clients because you are an important contact of Purple Communications, a boutique stakeholder

communications consultancy. If you do not wish to receive such emails from Purple, please click mailto: purple@purplecom.com.au subject=UNSUBSCRIBE or

reply to this email and put UNSUBSCRIBE in the subject line and we will not email you again.

If you do not reply, we will continue sending you relevant news and information via email. However, all future emails will allow you to unsubscribe.

Issued by

Purple Communications

Level 3, 28 Kings Park Road, WEST PERTH WA 6005

Ph: 08 9485 1254 Fax: 08 6263 0455

purple@purplecom.com.au