Atlas Iron JV under caveat

Atlas Iron’s partner Haoma Mining has placed a caveat over two north Pilbara tenements to preserve their rights over the Daltons Joint Venture.

Haoma’s rights under the 2012 agreement with Atlas Iron and Giralia Resources relating to Mt Webber include all metals within Mt Webber (ML45/1197) except iron ore, and royalties of $1.38 per tonne of iron ore after 24 million tonnes are mined, as well as 25 per cent of iron ore from EL45/2922.

Haoma chairman Gary Morgan advised the ASX that precious metals samples of concentrate from Mt Webber drill chips showed 860 grams per tonne (g/t) of platinum, 740 g/t of palladium, 150 g/t of gold and 220 g/t of silver, with iron ore grade at 41 per cent.

Atlas Iron bought the Mount Webber tenement from Haoma in 2012 for $10 million in cash and $23 million in discounted Atlas shares, then worth close to $1.00.

Atlas Iron entered a voluntary trading halt last week, freezing the share price at 12 cents.

Atlas continues to haul iron ore to port with contractor McAleese Group, however estimates have been made that at an iron ore price of US$47 per tonne, Atlas are losing $15-16 per tonne.

In its January 2015 quarterly report Atlas said All-In Cash Costs were down to $67 to $65 per wet metric tonne (wmt) in the first half of FY2015.

Atlas Iron’s debt rating rating was downgraded from B- to CCC, a “junk” rating applying to companies that are vulnerable and dependant on favourable conditions.

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