16 January 2008

ASX / Media Announcement

BALLA BALLA EXPLORATION UPDATE

DRILLING TARGETS SIGNIFICANT RESOURCE / RESERVE INCREASES 

Pilbara magnetite developer Aurox Resources Limited (ASX: AXO) has received the first assay results from its drilling programme at Balla Balla, which have confirmed potential to double the current resource base at the advanced Pilbara project.

The reverse circulation (RC) drilling programme is designed to significantly increase the strike length of the titanomagnetite mineralisation, which hosts ore reserves of 103 million tonnes, from 4.8 kilometres to 18.3 kilometres. A series of deep RC holes are also planned to extend the open-cut mineralisation down dip from 125 vertical metres to approximately 250m.

Managing Director Charles Schaus said the exploration success to date is a positive milestone for shareholders.

“Aurox remains on track to become WA’s first magnetite iron ore producer from the low cost Balla Balla project, which is located near the Pilbara coast 100kms west of Port Hedland,” Mr Schaus said.

In-house studies of geophysical data and past RC drilling indicates the potential to double the current 325 million tonne titanomagnetite resource and increase ore reserves to more than 350 million tonnes once the drilling, resource modelling and reserve estimation work is finished.

The programme is scheduled for completion by August of this year with interim resource estimations generated and reported as drilling progresses. Highlights from drill assays received to date include:

HOLE                         WIDTH (m)                FE(%)             V2O5(%)        TiO2(%)

BBR265                             30                          46                    0.61                 15

BBR266                             44                          45                    0.62                 14

BBR277                             30                          46                    0.66                 14

BBR296                             30                          47                    0.71                 14

BBR304                             34                          47                    0.66                 15       

The attached table displays results of all drill assays received to date. A total of 111 RC holes totalling 8,294m were drilled prior to Christmas. This phase of drilling achieved its design criteria by:

1)      deepening the Central Zone mineralisation,

2)      extending the Central Zone mineralisation eastwards by 800m, and

3)      drilling the ‘East Block B’ area which hosts approximately 1,500m (strike) of easily-accessible, shallow and flat-lying titanomagnetite mineralisation.

The attached map shows where the open pits enclose the current 103 million tonne ore reserves and the location of the titanomagnetite mineralisation subject to ore reserve conversion as the RC drilling programme progresses.

Assay results from 33 of the 111 holes have been received to date and are summarised in Table 1. Highlights include 44m @ 45.3% Fe (BBR266 in the Central Pit area), 30m @ 46.0% Fe (BBR277 in the Central Pit Eastern Extension) and 34m @ 46.7% Fe (BBR304 in East Block B). The results show that grades and thicknesses remain consistent along strike and at depth. The Balla Balla 3D block resource model will be updated and expanded on a regular basis when the assays from each phase of drilling are received. New JORC-compliant reserve figures will be estimated and announced in due course.

The drill programme resumed on 9 January and a second rig is due to arrive in the middle of the month. This next phase of drilling will deepen the Western Pit Area and then extend it along strike to both the north-east and south-west.

Notes to accompany the results:

1)       All holes drilled vertically; apparent intercept widths are quoted

2)       Downhole samples were composited over 2m intervals through the ore zone and assayed by Genalysis Laboratories in Perth

3)       Sample preparation: All samples were sorted, dried, then subjected to Single Stage Mix and Grind (SSMG) to nominal 1050 micron

4)       Analytical methodology: Fused Disc X-Ray (suitable for ore grade material):- A sub sample is automatically determined for LOI and fused into a glass disc using a Lithium Borate flux with direct analysis using PANalytical Magix Fast Simultaneous X-ray system for the following element suites:   Al2O3, CaO, Fe, Fe2O3, K2O, LOI @1000C, MgO, Mn, Na2O, P, S, SiO2, TiO2,  Plus Traces: V Cr Co Ni Cu Zn As Sn Ba Pb

Competent Persons Statement

The information in this report that relates to Exploration Results, Minerals Resources or Ore Reserves is based on information compiled by Matt Chinn who is a member of the Australian Institute of Mining and Metallurgy and a full-time employee of Aurox Resources Limited. Matt Chinn 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, Mineral resources and Ore Reserves.’ Matt Chinn consents to the inclusion in the report of matters based on his information in the form and context in which it appears.

About Aurox

Aurox Resources Limited (ASX: AXO) is a Perth based metals developer, with its primary asset the 100% owned Balla Balla iron ore concentrate project. The project is located near the coast west of Port Hedland in the renowned Pilbara region of Western Australia.

Aurox is well advanced in the development of Balla Balla, having completed a Bankable Feasibility Study for six million tonnes of magnetite iron ore production annually. The Company has in place two 15 year sales contracts each for 3mtpa with major Chinese Steel Companies 

Balla Balla is based on a large homogenous magnetite ore body, which will be developed as one of the lowest costs magnetite operations in Australia. The project also has significant titanium potential, and is located near major ports, gas and grid power with main highway access

The new Balla Balla Bankable Feasibility Study demonstrates strong project economics with magnetite iron ore shipments to China scheduled to commence mid 2010.

AuroxResources Limited

Charles Schaus

Managing Director

BALLA BALLA RESOURCE DRILLING RESULTS

Table 1

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