Ferrowest Limited (ASX:FWL) - Kobe Steel And Midrex Technologies Enter MOU With Ferrowest

Sydney, Jan 29, 2008 (ABN Newswire) - Ferrowest Limited (ASX: FWL) - The Company is pleased to announce that it has entered into a Memorandum of Understanding (MOU) with Kobe Steel Ltd (Kobe) and its 100% owned subsidiary Midrex Technologies, Inc (Midrex).

Ferrowest Limited (ASX: FWL) present the following audio webcast regarding "FWL - Kobe Steel and Midrex Technologies Enter MOU with Ferrowest - Mr Brett Manning, MD".

Audio webcast Link:

Listen to the Audio stream and view the announcement for Ferrowest Limited (ASX: FWL) below.

http://abnnewswire.net/vlnk/8L64D1YW

The MOU, which is non-exclusive and non-binding, enables the Company to continue working with Kobe and Midrex to establish the operating parameters for the ITmk3 and Fastmet/Fastmelt technologies which are being considered for the merchant pig iron plant component of the Company's Yalgoo Iron Project.

The MOU follows a recent visit by Midrex representatives to Perth, Yalgoo and Geraldton to gain a first hand understanding of the Company's plans for the Yalgoo Iron Project.

Before the MOU can be extended to a more formal agreement, the parties must agree:

–that the Yalgoo Iron Project is economically feasible using the selected technology;
-the selected technology must have been satisfactorily commercialised;

-that a mutually acceptable development timeline has been agreed which will fit with Ferrowest's requirements and the various project commitments that Kobe and Midrex have internationally; and

-on the final commercial terms for the licensing of the selected technology.

Ferrowest Managing Director, Brett Manning said that the Midrex visit had been very productive and had led to the signing of the MOU.

"The ITmk3 process has always been our preferred technology for this project, although two others remain in contention, but this visit was an excellent opportunity to map out a path to take the technology selection process forward."

Ferrowest Project Director, Barry Wyatt was pleased to have the opportunity to take the Midrex representatives through the technical aspects of the Yalgoo Iron Project.

"The Midrex representatives showed a genuine interest in the technical detail of the Yalgoo Iron Project and were clearly keen to see either ITmk3 or Fastmet/Fastmelt form the centrepiece of our value adding business plan.

While there is still quite a range of feasibility study work to be completed, it is good to know that Midrex will be able to provide the technical data necessary to allow us to successfully complete the Bankable Feasibility Study for the project."

The Company has also decided to alter the time line for the Yalgoo Iron Project to facilitate testwork and engineering with Kobe and Midrex. The revised timetable will be:

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–Definitive Engineering Study Complete -4thQtr 2008
-Bankable Feasibility Study Complete   -2ndQtr 2009
-Financial Close                       -3rdQtr 2009
-Construction Complete                 -2ndQtr 2011
–Commissioning                            -Mid 2011
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Managing Director, Brett Manning, commenting on the revised timetable said: "The studies into the Yalgoo Iron Project have reached a criticalpoint and we firmly believe that by extending the time line we will reap significant benefits in the optimisation and ultimate economics of the Project."

Yalgoo Iron Project Outline

Ferrowest Limited is developing the Yalgoo Iron Project aimed atproducing seaborne traded merchant pig iron from the Yogi magnetite mineralisation near Yalgoo in the mid west region of Western Australia. Proposed initial production is 500,000 tonnes per annum. The plan to process the iron ore to pig iron on the mine site is premised on emerging mine site based technologies and excellent existing infrastructure servicing the site. The resulting value added merchant pig iron product will be a relatively high margin, highquality, low volume product for export to electric arc furnace steel making plants worldwide.