Atlas sells non-iron rights on two tenements to Shaw River

West Perth-based Atlas Iron Ltd will sell the non-iron mineral rights of its Abydos and Goldsworthy tenements to West Perth gold explorer Shaw River Resources Ltd for $1.5 million in scrip and the issue of 2.5 million options, the company has announced.

The full text of a company announcement is pasted below

Atlas Iron Limited (ASX Code: AGO) today announced it has agreed with Shaw River Resources Limited (ASX Code: SRR) ("Shaw River") to sell the certain non Iron mineral rights on Atlas' Iron's Abydos and Goldsworthy tenements to Shaw River for a consideration of $1.5 million of Shaw River shares and 2.5 million options in Shaw River exercisable at 20 cents on or before 31 December 2010. The transaction is subject to Shaw River shareholder
approval.

Material Terms and Conditions of Agreement with Shaw River:

1. Shaw River will issue to Atlas $1.5 million worth of ordinary shares at an issue price of the 5 day VWAP prior to this announcement.
2. Shaw River will grant to Atlas 2.5 million options exercisable at 20 cents on or before 31 December 2010.
3. Atlas will assign certain Non Iron mineral rights limited to gold, silver, copper, lead, zinc, nickel and PGEs.
4. Atlas will retain a first right of refusal to re-acquire these Non Iron rights.
5. The agreement is subject to Shaw River receiving shareholder approval for the transaction at a shareholder meeting expected to be held in late January 2007 and all other necessary regulatory approvals.

Atlas Managing Director David Flanagan said "This sale of non Fe rights enables Atlas to remain focused on commencing shipping of direct shipping grade (DSO) iron ore from its Pardoo Project by October 2008 as well as exploring and developing its other iron ore projects."