Atlas Iron : Back Mining at Mount Webber

ASX Announcement 1 July 2015

A t l a s B a c k M i n i n g a t M o u n t We b b e r

Atlas Iron Limited (ASX: AGO) is pleased to advise that mining operations have recommenced at its Mount Webber mine in the Pilbara region of Western Australia. Processing is planned to recommence mid-July with Mt Webber ore tonnes contributing to shipping shortly thereafter.
Mount Webber production, which is targeting a production rate of 6Mtpa, is expected to make a meaningful contribution to the Company's targeted year end production rate of 14-15Mtpa.
As previously announced, as a result of landmark agreements with BGC Contracting Pty Ltd (BGC) (refer to ASX announcement of 2 June 2015) and other key contractors and suppliers, as well as significant cost reductions in corporate overheads, at its targeted year-end production rate of 14-15Mtpa, Atlas' break-even cost of production is
down to approximately USD$50/dmt1 (IODEX 62% Fe CFR China basis), based on full cash costs2.
Atlas Managing Director David Flanagan said the Company was delighted that mining operations were now back up and running at all three of its Pilbara iron ore mines, with a dramatically improved cost base to underpin strong cash flow generation and a more sustainable business.
"With Mount Webber mining operations now back underway, Atlas is on track to grow production over the remainder of 2015 with significantly improved margins compared to operations pre-suspension, thanks in large part to the support of our key contractors and suppliers," Mr Flanagan said.
The Company's sales program is progressing well, with a largely fully sold position now established for the September quarter and sales progressing into the December quarter, locking in the US dollar iron ore price in respect of these sales. Demand for both Atlas' Standard Fines and Lump products has been strong, as evidenced by reduced product discounts from recent sales.
Following the overwhelming support from shareholders at the Company's recent General Meeting of shareholders, the Company is currently completing a capital raising that has already received significant support from Atlas' contractors. Shareholders have a priority right to subscribe for new shares (through the Shareholder Participation Offer, 'SPO') at 5 cents, with 1 free attached option at 7.5 cents.
The offer is also available to the general public, with application forms and the prospectus available online at www.atlasiron.com.au. Any investment in Atlas should be made subject to review of the Company's Prospectus.

Atlas Iron Limited

ABN 63 110 396 168

Mining is back on at Mt Webber

Raine Square, Level 18

300 Murray Street Perth WA 6000

PO Box 7071

Cloisters Square Perth WA 6850

E: atlas@atlasiron.com.au
W: www.atlasiron.com.au

1. IODEX 62%Fe CFR China breakeven price defined by adjusted iron units, spot product FOB discount, moisture and full cash costs on the basis of targeted 14-15Mtpa run rate by year end. AUD: USD exchange rate of 0.785.

2. Full cash costs include: All In Cash Costs (includes C1 Cash Costs, royalties, freight, corporate and administration, expensed exploration and evaluation, but excludes interest expense, capital expenditure, depreciation and amortisation, one-off restructuring costs and other non-cash costs. C1 Cash Costs include costs of mining, processing, rail and port and other direct costs incurred to the point of a wet metric tonne passing the ships rail. C1Cash Costs are inclusive of both contractors and Atlas' costs.

Atlas Iron +61 8 6228 8000
David Flanagan, Managing Director

Read Corporate +61 8 9388 1474
Paul Armstrong +61 421 619 084

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