The Age reported that Atlas Iron is seeking AUD 60 million from a discounted placement to fund an acceleration of its iron ore expansion plans in the Pilbara.

The placement is expected to get away at a 7% to 8% discount on the group’s market price ahead of the trading halt, suggesting a price of about AUD 2.50 a share.

Atlas currently produces iron ore from its Pardoo project, 75 kilometres by road from Port Hedland. It also plans to develop the Wodgina and Abydos projects, taking its planned shipments from 6 million tonnes this year to 12 million tonnes by 2012. It has a production target of 24 million tonnes a year in 2014.

Funds from the placement are expected to provide the additional working capital to crank up output this year to something substantially more than the previously planned annual run rate for 2010 of 6 million tonnes.

It will also help fund a faster pace of development work at Wodgina, currently due to start in the second quarter of calendar 2010, with shipments of ore starting later in the year. Apart from the surge in iron ore prices, Atlas’ move to accelerate its growth iron ore production is related to the availability of some early capacity at the new Utah Port development at Port Hedland.

(Sourced from The Age)