Atlas Iron Limited (ASX: AGO)
ASX RELEASE 19 December 2008
ATLAS COMPLETES SALE OF SECOND SHIPMENT OF CONNIE DEPOSIT ORE
Atlas Iron Limited (ASX Code: AGO) is pleased to announce that it has entered into an agreement with a large Chinese steel mill for the sale of the second shipment of iron ore from the Connie Deposit at its 100%-owned Pardoo DSO Project. As a result, Atlas will immediately commence hauling ore to Port Hedland for shipment.
As previously advised, Connie is a lower grade ?startup deposit?. Its low strip ratios, homogenous ore character and proximity to infrastructure provided the best opportunity to mine, process and ship ore as quickly as possible after receiving final approval to mine.
?The sale of this second shipment of Connie to a large and dynamic Chinese Steel mill is another exciting step for Atlas.? said Atlas Managing Director, David Flanagan. ?The strong demand for the cargo augers well for Atlas? ongoing marketing efforts for Pardoo ore and highlights the strong desire of leading Asian steelmakers to align with an emerging Australian iron ore producer. This second shipment will generate valuable operating profit to assist us with our ongoing mine development at Pardoo.?
In line with normal commercial terms, letters of credit are expected to be put in place within the next five business days and this shipment is expected to be exported through Port Hedland in mid/late January 2009.
Mining is underway at the higher grade Bobby deposit at the Pardoo Iron Ore Project, located 75 kilometres by road from Port Hedland, in the Pilbara of Western Australia.
Atlas announced today, 19 December 2008, that it has entered into a long term off-take agreement with a medium-sized Chinese steel mill for the sale of approximately 30% of iron ore produced from its 100%-owned Pardoo DSO Project for the period to 31 March 2012. Off-take negotiations for the balance of the Pardoo iron ore are ongoing and the Company expects to complete and disclose further contracts in the short term.
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Background Atlas Iron Limited
Atlas recently commenced mining at its 100%-owned Pardoo Iron Ore Project in the Pilbara of Western Australia where it completed its first shipment in early December 2008. Atlas is fully funded with approximately $95 million cash at bank and zero debt as it ramps up to 1Mtpa. 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 of 6 Mtpa for 2010, growing to 12 Mtpa by 2012.
For further information please contact
David Flanagan, Managing Director
Ken Brinsden, Operations Manager
Mark Hancock, Chief Financial Officer
Tel: (08) 9476 7900
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