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Perth, Nov 16, 2011 (ABN Newswire) - Atlas Iron Limited (
ASX:AGO) is pleased to announce that it has entered into an agreement to acquire a 90% interest in the Corunna Downs DSO Project in the North Pilbara from Gondwana Resources Limited (ASX:GDA) for A$2.1 million in cash, paid in three tranches. The agreement is in the form of a staged 12-month exploration option for 100% of Gondwana's interest in the project. Corunna Downs is located approximately halfway between Atlas' Mt Webber and McPhee Creek DSO Projects in the North Pilbara region.
"We continue to look for DSO opportunities in the Pilbara" commented David Flanagan, Atlas Managing Director. "This project fits perfectly into our Horizon 2 expansion plans, with the potential to add DSO tonnes to the Mt Webber / McPhee Creek area ".
The principal terms of the agreement are as follows:
- Total consideration of A$2.1mil in cash paid in three tranches (A$350,000 on signing, A$350,000 six months after signing and A$1.4mil on exercise of the option and transfer of the tenements to Atlas);
- Gondwana to retain a royalty of A$1.13 per tonne for all iron ore mined; and
- Atlas to retain a right to buy back the GDA royalty for A$0.20 per ore reserve tonne.
ASX:AGO) is pleased to announce that it has entered into an agreement to acquire a 90% interest in the Corunna Downs DSO Project in the North Pilbara from Gondwana Resources Limited (ASX:GDA) for A$2.1 million in cash, paid in three tranches. The agreement is in the form of a staged 12-month exploration option for 100% of Gondwana's interest in the project. Corunna Downs is located approximately halfway between Atlas' Mt Webber and McPhee Creek DSO Projects in the North Pilbara region."We continue to look for DSO opportunities in the Pilbara" commented David Flanagan, Atlas Managing Director. "This project fits perfectly into our Horizon 2 expansion plans, with the potential to add DSO tonnes to the Mt Webber / McPhee Creek area ".
The principal terms of the agreement are as follows:
- Total consideration of A$2.1mil in cash paid in three tranches (A$350,000 on signing, A$350,000 six months after signing and A$1.4mil on exercise of the option and transfer of the tenements to Atlas);
- Gondwana to retain a royalty of A$1.13 per tonne for all iron ore mined; and
- Atlas to retain a right to buy back the GDA royalty for A$0.20 per ore reserve tonne.
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About Atlas Iron Limited
Atlas Iron Limited (ASX:AGO) is mining and exporting from its 100%-owned Pardoo and Wodgina Iron Ore projects, located 75 kilometres and 110km by road from Port Hedland in the Pilbara region of Western Australia. In the 2009/10 financial year Atlas shipped over 1.2 million tonnes of Pardoo Direct Shipping Ore (DSO). Atlas is expanding its production from its Wodgina and Pardoo DSO mines following the commissioning of the Utah Point port facility and is targeting exports at an annualised rate of 6 million tonnes by the end of 2010. When combined with additional export tonnages from its Abydos & Mt Webber DSO Projects, the Company is targeting exports at an annualised rate of 12 million tonnes during 2012.
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>>>          Atlas Iron Limited>>> Gondwana Resources Limited |
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