Emergent Resources Limited (ASX:EMG) Signs Agreement For 15% Share Placement To CMIC And Establishment Of A$200 Million 50:50 JV On Beyondie Project

Perth, Oct 28, 2009 AEST (ABN Newswire) - Emergent Resources Limited (ASX:EMG) is pleased to advise that a Subscription and Option Agreement (Agreement) has been signed in Beijing by EMG and the State Owned Enterprise (SOE), China Metallurgical Investment Co Limited (CMIC) to proceed with the previously announced share and option placement in Emergent and A$200m 50:50 Beyondie Development Joint Venture to achieve the commencement of mining operations with an initial targeted production of 3Mtpa of magnetite concentrate.

EMG has also been advised by CMIC that to achieve a proposed second stage of the Beyondie Project's annual production output to 8 million tonnes of magnetite concentrate (following the first stage 3 million tonnes per annum production), the Joint Venture will be seeking additional funding over the initial A$200m investment.

In addition, EMG will seek shareholder approval for an additional placement of approximately A$5million to fund the initial payment of A$4.5 million to De Grey Mining Limited for the acquisition of 100% of the Beyondie Project as announced on 5 October 2009.

Emergent will now seek to obtain approval from shareholders for the placement to CMIC and the separate share issue .A Notice of Meeting will shortly be sent to shareholders.

The Agreement provides:

1. EMG will issue 8,553,971 shares at 45 cents per share and grant 4,276,986 options at 27 cents per option to CMIC. The options expire on 31 October 2010 and have an exercise price of 20 cents.

2. that the parties will use reasonable endeavours to negotiate and sign all joint venture and loan documentation on or before 15th December 2009 based on key terms set out in the Agreement.

3. that all approvals and documentation must be completed by 31 March 2010.
4. a nominee of CMIC will be appointed to the EMG board.

The Agreement is subject to:

- shareholder approval for the issue of shares and options to CMIC;

- Foreign Investment Review Board approval;

- EMG and CMIC signing the Beyondie Joint Venture documents and loan agreement for a A$100 million loan to EMG to fund EMG's initial commitments to the Beyondie Development Joint Venture; and

- approval of the Peoples Republic of China National Development and Reform Commission (NDRC) and other relevant authorities.

Emergent Chairman George McMaster said: "I am particularly pleased with the outstanding progress made in just 14 months since Emergent's ASX listing. It was in our IPO that we set our philosophy of; "Today's exploration brings tomorrow's success!" and I believe that all Stakeholders will benefit from our past exploration focus and from our proposed mine development with CMIC, our new partners."

Managing Director Garry Hemming said "We are delighted with the subscription placement agreement for CMIC to take this important position in the Company. We would anticipate that the conditions to the Agreement will be satisfied within the required time frame. We now look forward to proceeding with the Beyondie 50:50 Development Joint Venture with CMIC."

Background

On July 3 this year, Emergent announced that it had entered into a Commercial-in-Confidence non-binding MOU with CMIC for the development of the Beyondie Iron Project in Western Australia's Mid West iron ore region, subject to the satisfactory completion of due diligence and completion contracts to achieve the commencement of mining operations with an initial targeted production of 3Mtpa of magnetite concentrate.

EMG announced the successful completion of the CMIC Due Diligence on the 15th October 2009.

The MOU provided for the establishment of a 50:50 Development Joint Venture and the provision of A$200 million funding for the Project by CMIC with a placement to CMIC to raise an additional A$5 million, thereby affording CMIC an approximate 15% holding in Emergent.

Contact

Garry Hemming Managing Director Emergent Resources Mob: +61-419-835-757 Email: ghem@westnet.com.au Website: www.emergentresources.com.au