Atlas Iron Limited (ASX: AGO)

ADDITIONAL EXCELLENT RESULTS ENHANCE WODGINA DSO PROJECT

Atlas Iron Limited (ASX Code: AGO) is pleased to announce further high grade, near surface results from its ongoing RC drilling program at Wodgina (See ASX announcement, 11^th December 2008), 100 kilometres south of Port Hedland in the Pilbara of Western Australia. New intersections include:

46 metres at 60.6 % Fe, 0.04% P, 4.78% SiO₂ and 1.13% Al₂O₃ from surface

36 metres at 60.8% Fe 0.05 % P, 3.44% SiO₂ and 1.19% Al₂O₃ from surface

36 metres at 60.1% Fe 0.08% P, 4.78% SiO₂ and 0.72% Al₂O₃% from 14 metres

Wodgina, which is part of the Greater Abydos Project, is strategically well placed abutting the Great Northern Highway, the FMG Railway line and the BHPB Railway line.

��We are very excited about these results.  They are at or near surface, with consistently higher iron grades, low phosphorous and alumina levels which makes for a very saleable product,�� commented David Flanagan, Atlas Iron��s Managing Director.

��We think this new discovery is one of our most exciting finds to date and to get such good results in our first few holes would suggest we are likely to find a lot more and turn this into our third mining centre.��

Results received to date are limited to 19 holes of a 140-hole RC drill program (including those released in Atlas�� announcement dated 11 December 2008). Results from the balance of the holes due during December 2008 and January 2009 are expected to provide indications on deposit geometry and early tonnage potential.

As exploration moves on to the balance of untested targets in the northern part of the area, Atlas remains optimistic of further exploration success and growth in the Company��s DSO resources.

These additional drilling results validate the significant prospectivity of the Greater Abydos region, for which Atlas has established an exploration target of 100 to 140 million tonnes at 57 to 60% Fe.

Background Atlas Iron Limited

Atlas recently commenced mining and shipping ore from its 100%-owned Pardoo Iron Ore Project in the Pilbara of Western Australia.  Atlas is fully funded with approximately $100 million cash at bank and zero debt. Atlas is planning to export 1 million tonnes during its first 12 months of operations at the Pardoo Project, growing to 3 Mtpa for year 2. With additional export tonnages from Abydos, the Company is targeting exports at a rate of 6 Mtpa by 2010, growing to 12 Mtpa by 2012.

For further information please contact:

David Flanagan, Managing Director

Andrew Paterson, Geology Manager

Tel (08) 9476 7900

Exploration Results

The information in this report that relates to exploration results is based on information compiled by Mr. Mark Gunther who is a member of the Australian Institute of Geoscientists and is an employee of Atlas Iron Limited. Mark Gunther 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 2004 Edition of the ��Australasian Code for Reporting of Exploration Results��. Mark Gunther consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

References to Exploration/Production targets and Potential 

While the company remains optimistic it will report resources and reserves in the future from its Greater Abydos Region outside of the Abydos Project area, any discussion in relation to exploration targets, resource potential, reserves or ��ore�� is only conceptual in nature, as there has been insufficient exploration to define a Mineral Resource at the company��s Greater Abydos Region outside the Abydos Project area proper and it is uncertain if further exploration will result in the determination of a Mineral Resource.

WODGINA RC DRILLING RESULTS (WDRC009 to 18)

Note: 2m composite samples, cone split sampling, 55.0% Fe lower cut, no upper cut, maximum internal waste of 2 m, analysis by X-Ray Fluorescence Spectrometry Method with Loss on Ignition (LOI) determined using Thermo-Gravimetric Analyses.

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