15th January 2008 ATLAS ACQUIRES OPTION OVER IRON ORE RIGHTS TO 505 SQKM OF PILBARA TENEMENTS FROM HADDINGTON RESOURCES
Atlas Iron Limited (ASX: AGO) is pleased to announce that it has entered into an option agreement to acquire the iron ore rights to 7 Pilbara tenements (E45/2287, 2268, 2294, 2288, 2244, 2346 & 2312 as outlined on the attached Tenement Location Plan), from Haddington Resources Limited (ASX: HDN).
Summary of the Agreement 1. Payment of $500,000 to HDN in cash or AGO shares (at election of HDN) upon execution of formal agreement The AGO shares will be valued based on the Volume Weighted Average Price (VWAP) for the 5 days prior to the agreement.
2. Payment of $1,000,000 in AGO shares upon AGO exercising it�s option to purchase Fe rights, which can occur no later than 12 months after the date of the formal agreement. The AGO shares will be valued based on the 5 day VWAP prior to the agreement.
3. HDN retains a 2% Gross Sales Royalty.
4. On the definition of an iron ore resources exceeding 25 Mt, HDN will have a one off right to claw back 30% for four times total exploration expenditure across the tenement group. In the event that HDN retain clawed-back joint venture equity, there is no royalty payable to HDN.
The tenements are between 75 and 160 kilometres from Port Hedland, less than 60 kilometres from the FMG and BHPB railways and less than 60 kilometres from the Great Northern highway. Some of these tenements adjoin the company�s Abydos project.
�These tenements are proximal to good infrastructure and prospective for iron ore� commented Atlas Managing Director, David Flanagan. �We are an active explorer, we look forward to getting on the ground, drilling some holes and building on our recent success on adjacent tenements at Abydos� he added.
For further information please contact David Flanagan, Managing Director Tel: (08) 9476 7900
HDN Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
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