The world-class Ridley Magnetite Project, a 2 Billion-tonne magnetite resource, is strategically located within the Pardoo project area and is 100% owned by Atlas. The Ridley resource consists of banded iron formation (BIF) which forms part of the Ridley Range, with an average in-situ resource grade of 36.5% Fe. The resource, which was estimated by CSA Global consultants, converts into a 970 million tonne reserve capable of producing 330 million tonnes of magnetite concentrate at 68.3% Fe - enough to sustain a world-class mining operation for over 30 years.

Details of the Ridley Magnetite resources and reserves are contained in the following tables.

Table 1: Ridley Magnetite Project in-situ magnetite resource

Table 2: Ridley Magnetite Project resource Davis Tube results, calculated November 2008 by CSA Global consultants.

In April 2009, Atlas released the results of a reserve estimate for Ridley, calculated by AMC Consultants Pty Ltd based on the CSA Global resource. The 970Mt of probable reserves represents an 88% conversion of the Indicated resource.

Table 3: Ridley Magnetite Project ore reserve (AMC Consultants Pty Ltd).

Figure 1: A schematic view of the Ridley topography looking west, with a potential pit design superimposed onto the Ridley Range. The Bobby and Alice DSO pits are shown in the right foreground and background, respectively.

Pre-Feasibility Study
In April 2009, Atlas announced the findings of a pre-feasibility study (PFS) on the Ridley Magnetite Project. This study, the culmination of work by a number of sub-consultants under the supervision of Engenium, sought optimal solutions for mining, crushing, ore delivery, ore processing, waste and tailings storage, power generation, sources of process water, concentrate delivery and export.

The PFS concluded that a large conventional truck-and-shovel open pit operation mining approximately 48Mtpa of magnetite ore would produce 15Mtpa of concentrate for export. Ore will be crushed in-pit, and both ore and waste will be hauled to the natural surface by conveyors, with rock waste and tailings encapsulated together in a staged waste storage facility. The ore will be processed by multiple stage autogenous grinding followed by magnetic separation, with an end product of 80% passing 30 micron, containing 68.3% Fe and 4.3% SiO₂.

Because of the limits to current shiploading availability in the Port Hedland port, offshore shiploading options were preferred. Ore concentrate will be pumped as a slurry to a trans-shipper approximately 20km offshore, where the existing ocean depth is sufficient to allow Cape-size vessels without the need for additional dredging. The slurry will be dewatered on board the trans-shipper, which will have the capacity to load vessels at 8,000tph (dry equivalent).

The project will require approximately 330MW of electrical power, which will require an on-site power station with a dedicated gas pipeline. The whole project will require a workforce of over 700 people.

The estimated capital requirement to establish the Ridley Magnetite Project is A$2,972 million, inclusive of a contingency of $250 million. The average annual real operating cost has been estimated at $36.22/tonne of concentrate.

For additional details regarding the Ridley Magnetite Project PFS outcomes, please refer to the ASX announcement of 14 April 2009.

Please click to view enlarged version of above map.

Figure 2: Ridley Magnetite Project Location Plan.