Stage 2

In addition to the strong performance of the Stage 1 operation during the year, Crosslands remains focused on progressing the Stage 2 expansion project.

Crosslands’ progressive upgrade of resources at Jack Hills and increased understanding of the geology and metallurgical characteristics of the orebody has further increased confidence in the project’s ability to sustain a large scale mining operation producing a suite of premium iron products.

In June 2008, Crosslands reported a significant increase to its JORC compliant mineral resources at Jack Hills to over 530 million tonnes, comprising 96.6 million tonnes of Direct Ship Ore (DSO) at 50% Fe cut-off, and 434.8 million tonnes of Beneficiation Feed Ore (BFO).

The DSO mineral resource of 96.6 million tonnes is made up of 77.1 million tonnes of Indicated and 19.5 million tonnes of Inferred Resource at 59.1% Fe

The BFO mineral resource is made up of 80.2 million tonnes of Indicated at 36.5% Fe and 354.6 million tonnes of Inferred Resource at 34.7% Fe.¹

Preliminary metallurgical test work including approximately 350 Davis Tube Recovery tests indicates that the likely weight recovery for the BFO Mineral Resource is in the order of 30 to 35%.

Using this assumption, the current BFO Mineral Resource equates to 130 to 152 Mt of potential concentrate at a grade in excess of 66% Fe giving a total of 227 to 249 Mt when added to the DSO Mineral Resource.²

Importantly, this increased mineral resource represents only 40% of the total strike length to be tested under the resource expansion program underway at Jack Hills. Resources are consequently expected to continue to grow as this program continues with further announcements to be made through the 2009 financial year.

As a result of this major resource upgrade, the Stage 2 Mine Feasibility Study was expanded to allow metallurgical testwork and resource definition work to incorporate the BFO materials.   The BFO mineral resource, reported to JORC standards, is supported by the preliminary metallurgical test work, referred to above, which indicated that a range of high grade, high quality concentrate products could be economically produced from BFO using conventional crushing and grinding followed by low intensity magnetic separation.

The beneficiated product from Jack Hills will be suitable for sintering and pelletising, and of a high enough grade to be manufactured into pellets for both direct reduced iron making and blast furnace iron making, thereby creating a wide range of market opportunities.Crosslands is undertaking the necessary evaluations to determine the optimum product suite to be produced at Jack Hills .



¹ Competent Person’s Statement  

The information in this announcement that relates to Mineral Resources of the Jack Hills Project is based on information compiled by Mr Malcolm Titley in his capacity as a principal of CSA Australia Pty Ltd.  Mr Titley is a member of the Australasian Institute of Mining and Metallurgy and the Australian Institute of Geoscientists.

The information in this announcement relates to Exploration Results and geological and mineralogical interpretations of the Mineral Resource estimate  of the Jack Hills Project is based on information compiled by Mr Dean Wingfield .   Mr Wingfield Is a full time employee of Crosslands Resources Ltd and is a member of the Australasian Institute of Mining and Metallurgy.

The information contained in this announcement that relates to metallurgical recovery of the Mineral Resource estimate of the jack Hills Project is based on information compiled by Mr Brian Povey in his capacity as a principal of Promet Engineers Pty Ltd.   Mr Povey is a Member of the Australasian Institute of Mining and Metallurgy.

Mr Titley, Mr Wingfield and Mr Povey have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as competent persons as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.

²   Note that this estimate does not include and consideration of and modification by mining, economic, marketing, legal, environmental, social and government factors and as such should not be confused with an Ore Reserve.