Cazaly May Earn A$1.65 Billion in Royalties From Rhodes Ridge

June 22, 2008

June 22nd (Bloomberg) – Cazaly Resources Ltd., which has applied for mining rights for the Rhodes Ridge project in Western Australia with Fortescue Metals Group Ltd., said it stands to win up to A$1.65 billion ($1.57 billion) in royalties if the bid is successful.

“It’s a commercial arrangement that we thought was a fair recompense to Cazaly whilst still allowing Fortescue to go out there and have a large return for their shareholders,” Nathan McMahon, Perth-based Cazaly’s joint managing director, said on the Australian Broadcasting Corporation’s `Inside Business’ show.

Fortescue founder and Australia’s richest man, Andrew `Twiggy’ Forrest, is battling with the country’s wealthiest woman, Gina Rinehart, over the right to mine one of the nation’s largest undeveloped iron ore deposits. Rinehart’s Hancock Prospecting Pty owns the mining rights in a joint venture with Rio Tinto Group and Wright Prospecting Pty.

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