Murchison Metals first shipment of iron ore to POSCO under the strategic alliance between POSCO and Murchison Metals left the Port of Geraldton earlier this month.

The 61,500 tonne shipment of iron ore to POSCO is the third shipment from the Jack Hills Project to leave the Port of Geraldton bound for customers in North Asia.

Murchisan Metals executive chairman Paul Kopejtka says this shipment to POSCO, one of the world's largest iron and steel producers, heralded a new era for Murchison Metals as a long-term supplier of premium quality iron ore.

"As part of the strategic alliance between POSCO and Murchison Metals signed in September 2005, POSCO secured the right to acquire up to 10 million tonnes of iron ore per annum under Stage 2 of our Jack Hills and Weld Range Projects," he said.

"Our alliance with POSCO is a major vote of confidence in the Jack Hills Project and we look forward to POSCO being one of our most important partners and customers for many years to come."

"We are therefore extremely pleased that POSCO has decided to acquire one of the earliest shipments from Stage 1 of the Jack Hills Project."

POSCO Australia managing director SM Woo, Managing Director says POSCO was delighted to acquire its first shipment of ore from Jack Hills.

"We are extremely pleased with the way our strategic alliance with Murchison Metals has developed in the last 18 months," Mr Woo says.

"In particular, we are impressed by the high-grade nature of the ore being produced at Jack Hills.

"We very much look forward to working with Murchison Metals as a customer, shareholder and mid-west infrastructure development partner."

As part of a strategic alliance executed between Murchison Metals and POSCO in September 2005, POSCO agreed to subscribe for equity in Murchison Metals and also secured the right to purchase up to 10 million tonnes of iron ore per annum over a 25 year period from Stage 2 of Murchison Metals' Jack Hills and Weld Range Projects.

About Murchison Metals

Murchison Metals is an ASX-listed iron ore company that owns 100% of the Jack Hills Project located in the northern corridor of the mid west region of Western Australia.

The Jack Hills Project contains a number of deposits of high grade hematite ore.Murchison Metals' high grade hematite ore can be mined and shipped directly to customers without further processing or concentration, which significantly improves the economics of the project and distinguishes Murchison Metals from many other iron ore producers.

Stage 1 of the Jack Hills Project involves initial production of 1.5 million tonnes of iron ore per year expanding to 2 million tonnes per year in 2008.

In Stage 2, Murchison Metals proposes to increase annual production of direct shipping high grade ore up to 25 million tonnes per annum. Iron ore would be railed to a new port facility at Oakajee north of Geraldton for export to customers in North Asia.