ansteel talking with dollars , page-9

GINDALBIE FINALISES A$534M EQUITY FUNDING AGREEMENT WITH ANSTEEL FIRST A$50M SUBSCRIPTION PAYMENT RECEIVED UNDER AGREED FUNDING STRUCTURE Gindalbie Metals Limited (ASX: GBG – “Gindalbie”)

has taken a further key step towards the development of the Karara Iron Ore Project in Western Australia after executing the Subscription Agreement with its joint partner, Anshan Iron & Steel Group Corporation (“Ansteel”), which finalises the funding structure for the combined A$534 million (30%) equity component of both the magnetite and hematite phases of the A$1.8 billion project.

In line with the Agreement, Ansteel has made its first A$50 million subscription payment, reinforcing its commitment to the rapid development of the Karara Iron Ore Project and highlighting the strong funding position of the Joint Venture – with both the debt and equity components underwritten by Anstee

The payment is the latest in a number of major milestones achieved by Gindalbie that underline the advanced stage of the Karara Iron Ore Project. These include:

A substantial increase in the JORC Code-compliant resource base to 1.43 billion tonnes of magnetite and 27.1 million tones of hematite, confirming the Karara Project as a world-class iron ore project;

The completion of a high-quality Bankable Feasibility Study which confirmed excellent returns; The signing of a wide-ranging Joint Venture Development Agreement with Ansteel, which effectively marked a development go-ahead for the project;

A strategic direct equity investment by Ansteel, making it Gindalbie‟s second-largest shareholder;

The finalisation of a 15-year Power Supply Agreement for the Karara Project with Verve Energy; The continuation of the environmental approvals process for both the hematite and magnetite stages of the Karara Iron Ore Project; and

The commencement of an expanded regional exploration effort targeting a range of exciting new prospects, including newly identified magnetite resources in close proximity to existing hematite deposits

The funding arrangements cover the 30% equity component of the agreed A$1.8 billion capital cost estimate for the the Karara Iron Ore Project. The total equity funding requirement for the magnetite and hematite projects amounts to A$534.5 million.

As part of its contribution to the equity funding for the Project, Ansteel has subscribed for 10 million shares in the Joint Venture‟s operating entity, Karara Mining Limited, giving it an initial 19.23% stake in this joint venture vehicle. The first A$50 million subscription payment has been received and banked in the Karara Mining bank account. Further subscription payments by Ansteel will be made as follows:

April 2008 A$55.0 million
July 2008 A$123.4 million
October 2008 A$143.7 million

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