new announcement

ASX / MEDIA RELEASE 14 JULY 2008
OPERATIONAL AND CORPORATE UPDATE
As a follow up to several announcements last week and particularly in relation to issues relating to Monarch Gold Mining Company Limited (ASX: MON) (“Monarch”) and outstanding loans to that company, it is now appropriate to provide a more detailed statement regarding India Resources Limited (ASX: IRL) (“Company”) actual status and forward business activities.
Corporate including Matters Relating to the Outstanding Loan to Monarch
The Company has previously reported the provision of a commercial loan to Monarch. The following is an update on the status of that loan:
1.
The loan facility was put in place under normal commercial terms. It followed a reciprocal loan arrangement put in place by Monarch in 2006, which provided funds to facilitate the successful start-up of the Company. This loan was fully repaid by the Company last year.
2.
The Company provided a loan facility to Monarch on normal commercial terms in 2007. $2.5 million was drawn down in August 2007. The remaining $7 million was drawn down in December 2007. Monarch has made a number of repayments by instalment and as at 30 June 2008, $6 million had been repaid and therefore $3.5 million remains outstanding.
3.
On Thursday, 10 July 2008 the Company was formally advised that Monarch had been placed into voluntary administration. In turn, the outstanding loan repayment schedule has been suspended, and we are waiting upon the Administrator advising on the capability and timing of repaying the outstanding amount. We anticipate a further update on this position during August.
4.
Clearly these developments are of concern to the Company. Notwithstanding, the Company does have sufficient funds to continue its activities and, most importantly, the continuing development of the Surda Mine.
5.
In the meantime though, the Company is considering whether it wishes to seek some additional funding to support the development of new projects in India and continuing exploration programs. We will continue to keep the market informed in this regard.
Operational Report
Surda Copper Project
Strong progress is being maintained at the Surda Copper Project and this project remains on target to become cash positive and profitable by the latter part of this quarter.
During May 2008, the Company achieved record daily production at Surda, along with steadily increasing grades and recovery rates.
During June, the Company passed the milestone of transporting 100,000 tonnes of ore. However for the full month, production figures were below target due to the early onset of heavy monsoons and unexpected delays in the delivery of three new load-haul-dumpers (LHDs), one of which arrived in the last week of the month. The two outstanding dumpers will be delivered in July.
These new LHDs will increase ore movement capacity in conjunction with previously purchased South African locomotives. The increase in horizontal transport will be well matched by proven capacity of hoisting of 1300 tonnes per day as reported previously. The Company has further identified opportunities to increase shaft hoisting capacity by modernising shaft controls and increase in cage size.
The Company now has more than 850 people employed on site at Surda and with a strongly committed team approach is moving rapidly towards full capacity within the existing program and mine structure.
The grade of the product being produced remains excellent and marginally above previous forecasts.
The Company is also continuing the development of a feasibility study for an additional decline between the two primary shafts at Surda with an aim to doubling production within the next two years, and to the Company’s ultimate production target of 900,000 tonnes (9,000 tonnes of copper in concentrate).
The increasing production and sales program from Surda continues to emphasise the Company’s capability of successfully developing operating mines on the Indian subcontinent. This demonstration is critical to the continual development and growth of the Company as it continues to review other opportunities that are consistent with the program at Surda.
Other Activities
The Company is continuing to review and develop other opportunities in both mine development projects and exploration programs using Australian exploration expertise and cost effective mining techniques. Apart from the above developments at the Surda Mine, the following is a summary of other current activities:
Askot Project
The Company holds a 17% strategic interest in, and is the major shareholder of, Pebble Creek Mining Ltd. (TSX-V: PEB), a Canadian company listed on the Toronto Venture Exchange. Pebble Creek’s main asset is the Askot Project: a VMS deposit of copper, lead, zinc, gold and silver mineralisation in northern India. Pebble Creek has engaged SRK Consulting to compile a resource estimation for the Askot project.
Aravalli Project
The Company holds two Reconnaissance Permits (RPs) in Rajasthan (north western India). The Aravalli Proterozoic metamorphic belt is prospective for copper, lead, zinc as well as gold. India Resources Limited has recently completed a reconnaissance drilling program with positive results. A diamond drilling program is ongoing, targeting extensions of deposits being mined currently by Vedanta Resources Plc (LSE – VED).
Diamonds
The Company’s diamond initiative is focused on the Bhandara Diamond Project where two anomalies indicative of kimberlite clusters have been identified, located in a region of several kimberlite fields. In addition, bulk sampling is planned at two diamondiferous kimberlites on the Company’s granted PL’s of the Dharwar Project in Andhra Pradesh.
Coal and Iron Ore
India’s rapidly growing economy is driving a surge in demand for power and steel. The Company is currently seeking suitable projects for rights to explore and develop coal or iron ore in India.
In closing, I would like to reconfirm the Board’s commitment to this exciting development program in India, and the increasing opportunities driven by a strongly increasing economy and a thirst for domestically produced minerals and metals.
We thank shareholders for their continued support.
Andrew V Simpson
Chairman