Ferrowest Limited has announced that it has entered into a MoU with Kobe Steel Ltd and its 100% owned subsidiary Midrex Technologies, Inc.

The release said that the MoU, which is non exclusive and non binding, enables the Company to continue working with Kobe and Midrex to establish the operating parameters for the ITmk3 and Fastmet Fastmelt technologies which are being considered for the merchant pig iron plant component of the Company's Yalgoo Iron Project.

As per release the MoU follows a recent visit by Midrex representatives to Perth, Yalgoo and Geraldton to gain a first hand understanding of the Company's plans for the Yalgoo Iron Project. Before the MoU can be extended to a more formal agreement, the parties must agree
1. That the Yalgoo Iron Project is economically feasible using the selected technology
2. The selected technology must have been satisfactorily commercialized
3. That a mutually acceptable development time line has been agreed which will fit with Ferrowest's requirements and the various project commitments that Kobe and Midrex have internationally
4. On the final commercial terms for the licensing of the selected technology.

Mr Brett Manning MD of Ferrowest Managing said that the Midrex visit had been very productive and had led to the signing of the MoU. The ITmk3 process has always been our preferred technology for this project, although two others remain in contention, but this visit was an excellent opportunity to map out a path to take the technology selection process forward."

He said that "The studies into the Yalgoo Iron Project have reached a criticalpoint and we firmly believe that by extending the time line we will reap significant benefits in the optimization and ultimate economics of the Project."