August 7th (The Sydney Morning Herald) – Atlas Iron Ltd has entered into a joint-venture agreement with Fortescue Metals Group Ltd (FMG) for Atlas’s Abydos project in Western Australia’s Pilbara region.

The joint venture covers a tenement over which Atlas owns the iron ore rights. Atlas also said that it was the first company to seal a port access deal with Fortescue for its new Port Hedland iron ore export terminal. “The primary focus of the joint venture is to define and develop extensions to the FMG Glacial Valley magnetite deposit, (part of the Abydos project)” Atlas said in a statement.

“FMG may earn a 60 per cent joint-venture interest in the iron ore rights by delineating inferred resources of iron ore within the tenement,” Atlas said. It also said FMG may earn a further 15 per cent joint venture interest in the iron ore rights by completing a pre-feasibility study on the mining of iron ore within the tenement.

A further 12.5 per cent joint venture interest may be earned in the iron ore rights by completing a definitive feasibility study on the mining of iron ore within the tenement. Atlas has converted a memorandum of understanding (MOU) into a binding heads of agreement to use Fortescue’s port facilities for the initial period of production from its flagship Pardoo project, about 100km from Port Hedland.

Pardoo commences production in October, with exports to follow in December.

“This is a ground-breaking third-party port access agreement, the first of its kind in Western Australia,” Atlas managing director David Flanagan said. “We now look forward to building on our association with FMG as we commence development of our second iron ore project, 120km south of Port Hedland at Abydos.”

Atlas is expected to negotiate a rail haulage agreement with FMG to transport ore from Abydos to port. It is also likely to use road haulage to get its product from Pardoo to port. Mr Flanagan flew from the Diggers and Dealers Conference in the mining town of Kalgoorlie to Perth to finalise the negotiations. He returned to the popular conference to make a presentation.

He told delegates that Atlas had not yet committed to offtake agreements because it planned to sell about 60 per cent of product on the spot market to capitalise on high prices. “Every other day we receive an offer … with a base case that we would achieve a premium to the benchmark price,” he said.

He said Atlas was spending between $1.2 million and $1.5 million on exploration each week. The only other company that has an MOU with Fortescue is BC Iron Ltd.


August 4th (Mineweb) – Gindalbie Metals Limited (ASX: GBG – “Gindalbie”) is pleased to announce a further substantial increase in the magnetite resource for its Karara Iron Ore Project in Western Australia to 1.853 billion tonnes grading 35.4% Fe.  

In addition, a revised Probable Ore Reserve, taking in an updated pit design containing 522 million tonnes grading 36.3% Fe is also announced.

The revised Mineral Resource and Ore Reserve inventory confirms the status of Karara as one of the largest undeveloped orebodies in Australia, capable of supporting a world-class, long-life operation. 

The total Indicated and Inferred Resource as at August 2008 represents a doubling of the previously announced Indicated and Inferred Resource of 929 million tonnes at 36.3% Fe announced in September 2007.

It is important to note the revised Ore Reserve is contained within a pit designed around the original project start up parameters of producing 8 million tonnes per annum (Mtpa) of high grade magnetite concentrate over a 25-year period. Gindalbie has now started work on a new pit design to define larger ore reserves to support increased production levels such as the proposed expanded production rate of 12Mtpa currently being studied.  

The updated Mineral Resource inventory follows the completion of over 31,300 metres of drilling in 223 drill holes. Sampling included 15,652 Head Assays and 5,541 DTR Assays.

The drilling has continued to demonstrate the robustness, consistent grade and quality of the magnetite orebody at Karara, which is being developed by Gindalbie and its 50% joint venture partner Anshan Iron & Steel Group Corporation (“AnSteel”). The substantial increase in the Resource is in large part due to depth extensions, with most of the resource model now extending to a depth of 600 metres below surface (previously 350 metres depth). Importantly, the 1.853 billion tonne resource is in excess of 75% in the Indicated category.  

This update represents the fourth increase in the Mineral Resource inventory for the magnetite deposit at Karara since exploration commenced in May 2005. In addition, recent drilling and ground survey work has confirmed the potential for further significant additions to the resource inventory, confirming the continuity of the deposit along strike.

The updated Mineral Resource estimate was calculated by CSA Consultants and is set out in Table 1 below:  

Table 1:     August 2008 Karara Magnetite Deposit: Resource Classification
Resource Classification Mt Fe % SiO2 % Al2O3 % P % LOI %
Indicated 1,417 35.5 43.2 1.25 0.09 -0.58
Inferred 437 35.1 43.9 1.44 0.09 -0.71
Sub Total 1,853 35.4 43.3 1.29 0.09 -0.61
Resources have been estimated for Oxide, Transitional and Fresh material separately. Material types have been combined in Table 1.

Resources are reported exclusive of Reserves defined within the July 2008 Open Pit design.


Reporting of Resources and Reserves is compliant with the standards and recommendations outlined in the Australasian Code for Reporting of Mineral Resources and Ore Reserves (2004), prepared by the Joint Ore Reserves Committee (JORC).

The remodeled open pit design consists of five stages of development, sequenced to minimize waste removal and produce consistent grade and volume of concentrate. The remodeled pit design contains 5% more Probable Reserve, produces 7% more concentrate and requires significantly less waste removal than the original September 2007 pit design. The waste to ore ratio has now fallen to 0.34:1 from the previous 0.42:1 in the September 2007 design. Importantly, the remodeled design has demonstrated the production schedule to be robust at mining rates of both 20Mtpa (8Mtpa concentrate) and 30Mtpa (12Mtpa concentrate).

Table 2:      Karara Magnetite Pit Tonnage  –   August 2008
Pit Design Mt Fe % SiO2 % Al2O3 % P % LOI %
Ore 522 36.3 42.8 0.82 0.09   -0.66
Concentrate 211 68.3 4.73 0.11 0.01   -2.86
Fresh and Transitional material classified as Probable Reserves.

Commenting on the announcement, Gindalbie’s Managing Director, Mr Garret Dixon, said the upgrade represented an outstanding result, improving all aspects of the previously announced Resource, Reserve, Concentrate and pit designs and confirming that Karara would deliver a long-term source of premium quality concentrate and pellets for Gindalbie’s joint venture partner, AnSteel. 

“We have now achieved four successive resource upgrades for Karara within the space of three years, with the Indicated and Inferred Resource doubling again from the previous resource as at September 2007 to the current level of 1.85 billion tonnes,” Mr Dixon said.  

“In addition, we have now defined an Ore Reserve over and above these Indicated and Inferred Resources of greater than half a billion tonnes,” he said. “This demonstrates clearly that Karara will sustain a long-life operation at the expanded 12Mtpa production rate currently being examined, as well as potential future expansions above this production level. 

“The revised Mineral Resource and Ore Reserve inventory would support over a 100-year plus mine life at the 8Mtpa production rate currently contemplated and 75 plus years at the expanded 12Mtpa production rate,” Mr Dixon added.

“The more work we do on this deposit, the better it is found to be. There has been improvement even in parameters such as the waste to ore strip ratio which means a corresponding reduction in mining costs. It is also worth noting that, based on the conversion and concentrate production parameters achieved, the revised resource and reserve equates to over 900 million tonnes of high-grade magnetite concentrate grading over 68% Fe – making this deposit equivalent to or better than some of the biggest hematite deposits in terms of potential iron ore product production in the world,” he said.

– ENDS – 

Released by: On behalf of:
Nicholas Read

Read Corporate

Mr Garret Dixon/Mr Michael Weir

Managing Director/Investor Relations Manager

Telephone: (+61-8) 9388-1474 Telephone: (+61-8) 9480-8700
Mobile: (+61-8) 419 929 046

About Gindalbie Metals Ltd (ASX: GBG)

Gindalbie is well advanced towards achieving its vision of becoming a leading independent Australian iron ore company with a diversified portfolio of magnetite and hematite production assets, located in the Mid West region of Western Australia

The initial focus of Gindalbie’s growth strategy is the Karara Iron Ore Project, located 225km east of Geraldton, where it will deliver initial production of Direct Shipping Ore (DSO) hematite in 2009 to be followed by production of high grade magnetite concentrate and blast furnace quality pellets in 2010. Karara is being developed through a 50:50 Joint Venture with Ansteel, one of China‘s leading steel and iron ore producers.

Gindalbie’s longer term growth will be propelled by the exploration and development of its extensive 1,900 sq km tenement portfolio, which includes numerous prospective magnetite and hematite exploration targets expected to deliver a long-term pipeline of growth opportunities.

July 30th (The Age) – Iron ore explorer Golden West Resources Ltd has increased the mineral resources at its flagship Wiluna West project in Western Australia, making it the second largest hematite resource in the state’s emerging mid-west iron ore province.

The iron ore resource at the project, in the inferred category of Australia’s mineral reporting code, now totals 119 million tonnes (Mt) grading 58.9 per cent iron, up 33 Mt on the previous resource of 86 Mt grading 60.1 per cent iron.

The company expects to further increase resources at the project within a fortnight based on a resource upgrade of the C4 deposit plus additional drilling information for the Bowerbird South deposit.

The largest reported hematite resource in the Mid-West is the Weld Range iron ore project, which is owned by Sinosteel Corporation-controlled Midwest Corporation Ltd.

Hematite is the most favoured variety of iron ore because it does not require processing.

Golden West Resources Ltd is expected to be a foundation customer of a new, yet-to-be-developed deep water port at Oakajee, 22km north of Geraldton, which is expected to be completed by about 2013.

Midwest was trumped by its one-time rival Murchison Metals Ltd on Tuesday when Murchison was selected by the state government as the preferred tenderer to develop the new port.

Shares in Golden West were steady at $1.80 at 1131 AEST.

July 29th (Steel Guru) – It is reported that Royal Boskalis Westminster has been awarded a EUR 145 million contract by Rio Tinto for the expansion of its iron ore port facility at Cape Lambert in Western Australia. The contract is due to be completed in the second half of 2010.

The assignment includes the dredging of new berth pockets, turning and departure basins and an access channel and will be executed with a combination of cutters and hoppers. The contract is conditional on Rio Tinto obtaining various approvals, including environmental.

Boskalis officials said that “Global demand for maritime infrastructure continues to be strong. Specifically, large scale projects in such as Cape Lambert are driven by the strong demand for energy and natural resources. Boskalis can successfully capitalize on these developments through its global presence and its selective contracting policy.”

Mr Peter Berdowski CEO of Boskalis said that “As a consequence of the recently acquired projects in Dubai and Australia, our fleet is well utilized through 2009. The margins on these new projects are healthy despite increases in operational cost items such as fuel and steel. Furthermore, the margin development on current projects is in line with our previous expectations.”

July 27th (The West Australian) – The WA Government is poised to make one the most contentious decision of its seven-year reign next week when Planning and Infrastructure Minister Alannah MacTiernan announces the preferred developer of a $1.5 billion port at Oakajee, north of Geraldton.
The announcement is expected on Tuesday, the final day of a two-day State Cabinet meeting in Geraldton.
After more than two decades of dithering about the viability of a port, next week’s announcement should signal the long-awaited go-ahead for a multi-user facility capable of underpinning the development of the Mid-West’s iron ore province.
But Ms MacTiernan’s announcement is also expected to stir fresh controversy only months out from a likely State election.
One of the two proponents, Yilgarn Infrastructure, is heavily backed by the Chinese Government, raising concerns in some quarters about China’s increasingly far-reaching grab for WA’s resources sector.
The other proponent, Oakajee Port & Rail, is owned by Japanese trading giant Mitsubishi and iron ore aspirant Murchison Metals, sparking separate concerns its ownership of both the port developer and a mine would raise conflicts of interest and disadvantage other miners wanting to use the port.
Ms MacTiernan has said the way she structured the Oakajee tender would ensure that nationality of the winning bid is immaterial — ownership of the port’s key multi-user components such as breakwater and channels would revert to the WA Government after project completion — and that the Geraldton Port Authority, which would operate Oakajee, would ensure fair access for all users.
Even with confirmation of a preferred Oakajee tender, significant hurdles remain.
Ms MacTiernan expects to spend until the end of the year negotiating a final development deal with the chosen party and financing of the $1.5 billion project, notwithstanding both proponents’ claims that funds are locked in, is likely to be a focus given the global credit crunch. It is hoped port construction can begin next year, with completion targeted by 2012.
A finished Oakajee should be capable of initially handling 30 million to 35 million tonnes of exports at year, with much of that to come from Murchison, the Sinosteel Corp-controlled Midwest and Gindalbie Metals.
Sinosteel yesterday extended the takeover deadline for its $1.4 billion cash bid for Midwest by a month to August 25 in the hope of snaring the few remaining minority shareholders.
Having bought an additional three million shares on market yesterday, Sinosteel’s stake has been boosted from 54 per cent to about 55.9 per cent and it continues to hold out for Midwest deputy chairman David Law’s 13.2 per cent stake.

July 24th (Business Spectator) – Australiasian Resources Ltd’s shares have surged 32.6 per cent to $1.585 after it announced it had received a $327 million takeover proposal from Billionaire Clive Palmer, who is planning to establish a new Australian resources group.

The iron ore miner said it had received a takeover proposal from Mr Palmer’s company Resource Development International Ltd (RDI), which already holds a 66.37 per cent stake in Australasian.

Under the proposal, RDI has placed a notional price of $2.20 on each Australasian share. Shareholders who accept the offer would be paid in RDI shares.

Mr Palmer wants to create a resources group to rival BHP Billiton and Rio Tinto and plans to list RDI, and if successful complete its merger with Australasian, by late 2008.

Australasian has been working to develop its proposed $2.7 billion iron ore mine, Balmoral South, in Western Australia with Chinese company Shougang Corp, which has a significant investment in the miner of 6.36 per cent.

It has been reported that Mr Palmer is seeking Chinese investment for his company, and would approach Shougang and Baosteel, seeking financial interest.

RDI will have a portfolio that includes iron ore, with a 10-billion tonne iron ore resource in the Pilbara, nickel, including the proposed Gladstone nickel project and steel mill, and other energy interests.

Through a strategic alliance MEO Australia is set to become the core of the new group’s energy division, while keeping a separate listing.

July 22nd (WA Business News) – Perth-based Gindalbie Metals Ltd has started its spending spree for its $1.8 billion Karara iron ore project in Western Australia by placing a $70 million order for key long lead items. Gindalbie and its joint venture partner, Anshan Iron & Steel Group Corp, have placed equipment orders with Polysius Australia, part of the Germany’s ThyssenKrupp group, with delivery expected by March 2010.

The orders are for two high pressure grinding rolls and four large ball mills for the crushing and grinding phase of the process plant. Earlier this year Gindalbie expanded the scope of its iron ore business with its feasibility study to look at a 12 million tonne per annum start up operation, up from 8Mtpa, at Karara.