Legend International Holdings Announces Paradise Phosphate Project Update

MELBOURNE, Australia--(BUSINESS WIRE)--

Legend International Holdings, Inc LGDI is pleased to announce this update on its Paradise Phosphate Project currently being developed near Mt. Isa, Queensland, Australia.

The Company is currently dealing with multi-national corporations that are conducting extensive due diligence for a potential strategic transaction relating to the development and financing of the phosphate assets. During discussions a number of potential partners have expressed interest in pursuing a dual track development strategy involving the production and sale of the high analysis fertiliser di-ammonium phosphate and mono-ammonium phosphate (DAP/MAP), in conjunction with producing high quality phosphate rock concentrate. Given current high prices being received for phosphate rock (approx. US$200/t cfr India) and the potentially smaller development lead time involved in producing phosphate rock, both rock and value added products is a viable development route.

Negotiations, although taking longer than expected, are continuing and the Company is still confident that a deal will be completed as interest in the project remains strong.

Paradise Project declared a Project of Regional Significance

Queensland Premier Anna Bligh has announced that Legend's Paradise South mining project had been deemed a Project of Regional Significance. For the full newspaper article published in Queensland's North West Star please see Legend's website:

http://www.lgdi.net/resources/i/north_west_star_220911.pdf

“The project is one of significance because it would contribute to the local, regional, state and national economies,” Ms Bligh said.

“Projects that are of regional or state significance under the Gulf Water Resource Plan are eligible to acquire water from a strategic reserve – which means no water will be taken from existing allocations.”

This declaration by the Premier is an important milestone for the project particularly with relation to securing water supply. The declaration means that water for the project will come from unallocated reserves of water and will have no effect on existing water users. The water will be used to process the ore and create the slurry which will transport the phosphate rock through a 142km pipeline to the proposed fertiliser complex south of Mount Isa. The Paradise South mining project is Legend's flagship deposit and the status of a Project of Regional Significance indicates its importance to the State of Queensland, Australia.

Updated Feasibility Study Financials

CRU Strategies (CRU), a division of CRU International Limited, is an independent commodity analyst which provides Legend with forecasts for DAP, MAP, sulphur, ammonia, phosphoric acid and phosphate rock. Legend has used these forecasts in its Definitive Feasibility Study (DFS) and Ore Reserve estimates. CRU Strategies has recently updated their long term forecast out to 2020 for DAP and MAP fertiliser. CRU's outlook for DAP and MAP prices over the next ten years has become significantly more bullish given the lack of production capacity growth, strength of food prices and a growing global population with higher income earning capacity.

Legend has updated its financial model used in the DFS with these updated CRU forecasts. Other operating and capital cost estimates have also been updated and the summary of the new financial results are provided in the table below.

SUMMARY OF THE PARADISE FEASIBILITY STUDY RESULTS
Scenario		Base Case		Expanded Case
Proven & Probable Ore Reserve – Paradise South		55Mt @ 33%P2O5
Annual Production (DAP/MAP/AlF3)		400Kt MAP, 200Kt DAP, 15Kt AlF3		400Kt MAP, 800Kt DAP, 30Kt AlF3
Mine Life		60yrs		30yrs
Total Nominal MAP Production – 30 yrs		12Mt		12Mt
Total Nominal DAP Production – 30 yrs		6Mt		24Mt
Total DAP/MAP/AlF3Revenue Generated (30 yrs)1		US$13,327M		US$25,937 M
Total Free Cash Flow (after tax and capital, 30 yrs) 1		US$3,666M		US$8,954 M
Average Annual EBITDA1		US$201M		US$485M
Average Annual Free Cash after tax1		US$143M		US$335M
Development Capital (Inc Working Capital)		US$830M		US$1,776M
Capital Payback1		5.8 yrs		5.3 yrs
Life of Mine Average MAP Price (fob Townsville)1		US$650/t
Life of Mine Average DAP Price (fob Townsville)1		US$653/t
MAP Average Cash Operating Margin2		US$322/t		US$392/t
DAP Average Cash Operating Margin2		US$325/t		US$395/t
Pre Tax IRR 3		31.0%		31.8%
Pre Tax NPV 3 8.0%		US$2,425M		US$5,865M
After Tax IRR 3		25.4%		26.1%
After Tax NPV 3 8.0%		US$1,592M		US$3,877M

Notes:		1: Excludes inflation and discount rate
		2: Excludes inflation and discount rate. Includes AlF3 credit.
		3: Includes commodity inflation (3.5% p.a), discount rate (8% p.a), and commodities' growth factor as per CRU forecasts, extrapolated to year 2024, with no growth in prices assumed past 2024 except for inflation.

Forward-Looking Statements

Forward-looking statements in this press release are made pursuant to the “safe harbour” provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, without limitation, the risks of exploration and development stage projects, risks associated with environmental and other regulatory matters, mining risks and competition and the volatility of mineral prices. Actual results and timetables could vary significantly. Additional information about these and other factors that could affect the Company's business is set forth in the Company's fiscal 2010 Annual Report on Form 10-K and other filings with the Securities and Exchange Commission.