Atlas acquires high grade Midwest iron ore projects
Atlas Iron Ltd has entered agreement to acquire two granted mining leases from private overseas investors.“These are high quality assets with excellent potential to grow production and shareholder value” commented David Flanagan, Atlas’ Managing Director. “We think these projects can ultimately deliver premium grade resources at a very low cost and that is a fantastic opportunity for Atlas” he added.The tenements at Mt Gould (M52/236) and Wilgie Mia (M20/118) are located in the Jack Hills and Mt Weld areas of the Midwest region of Western Australia and are highly prospective for iron ore. Mt Gould contains the interpreted strike extension to iron ore currently being mined and exported from Jack Hills.Exploration work already completed by Atlas prior to the acquisition included 1:5,000 scale mapping of outcrop and open pit mining areas, review of historical drilling data, and collection of rock chip samples. Sample traverses (37 samples) of massive hematite lenses at Mt Gould averaged 66.53% Fe and 0.037% P. Estimated true widths of the ore lenses varied between 3m and 25m (with an average of 8.9m). The main targets comprise up to six stacked ore lenses.Rock chip sample traverses at Wilgie Mia (14 samples) of the hematite-goethite mineralisation averaged 62.30% Fe and 0.103% P. The width of the mapped surface iron enrichment at Wilgie Mia varied between 40m and 50m.The two projects are considered to have combined exploration potential for 30 to 40Mt of resources grading between 60 and 66% Fe.A number of well funded infrastructure companies are currently working to achieve relevant approvals and subsequently construct multi user rail and port infrastructure in the Mid West Region of Western Australia. This infrastructure is currently planned to service the Wilgie Mia and Mt Gould Project areas.Atlas recently announced an $85 million fundraising to explore and develop its Pardoo DSO and Magnetite as well as its Abydos DSO projects located 75km and 100km respectively from Port Hedland in the Pilbara of Western Australia.The company remains on target to complete environmental approvals and export first ore at a rate of 1mtpa from Pardoo in October 2008. Atlas is working to grow production at Pardoo to 3mtpa by 2010 and Abydos to 3mtpa for a total 6mtpa by 2012.The company has sufficient cash reserves outside of the current raising to advance the Midwest projects in parallel with its other activities.