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Karara Iron Ore Project

The A$1.8 billion Karara Iron Ore Project is Gindalbie’s cornerstone production project in the Mid West region of Western Australia.

Encompassing a world-class magnetite deposit and multiple hematite deposits, Karara will underpin a substantial, long-life iron ore business with robust economics.

“…Major iron producer potential…”

Gindalbie is developing Karara through a 50:50 Joint Venture with Chinese steel producer, AnSteel. A wide-ranging Joint Venture Development Agreement was signed in September 2007, followed by a Decision to Mine in November 2007. An Equity Subscription Agreement outlining terms for Ansteel’s involvement in the Joint Venture was finalised in early 2008.

Karara will deliver some 10-11Mtpa of iron products from 2010, comprising at least 8Mtpa of high grade magnetite concentrate and blast furnace quality pellets and an initial 2Mtpa of Direct Shipping Ore (DSO) hematite.

The Project is underpinned by a world-class JORC-Code compliant resource base comprising a 522 million tonne magnetite reserve, a 1.853 billion tonne magnetite resource, a 10.9Mt hematite reserve and a 16.2Mt hematite resource.

Aggressive exploration programs are underway to increase the Karara resource inventory, with exploration targets of 80-100Mt @ 55-66% Fe for DSO quality hematite resources and 2.2-2.8 billion tonnes @ 36-38% Fe for magnetite resources.

Positive Bankable Feasibility Studies were completed in 2007 on both the start-up magnetite phase and the hematite phase of Karara and a Feasibility Study commenced in April 2008 on increasing the start-up production rate of the magnetite phase from 8Mtpa to 12Mtpa of concentrate.

The development of Karara will bring significant economic and social benefits to the Mid West Region. The Project was granted Major Project Facilitation Status by the Australian Federal Government in December 2006.