ATHENA RESOURCES LIMITED — Capital/Financing Update 2011

Aug 1, 2011

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63 Lindsay Street Perth WA 6000 p 61 8 9428 2900 f 61 8 9428 2910 e ahn@athenaresources.com.au www athenaresources.com.au ABN : 69 113 758 900

2 August 2011

The Company Announcements Office Australian Securities Exchange Limited 4 Floor 20 Bridge Street SYDNEY NSW 2000

ALS AMMTEC METALLURGICAL RESULTS ON BYRO MAGNETITE

Excellent results from ALS AMMTEC confirm CRIMM’s Mineralogical Study and Metallurgical Beneficiation Testwork at a coarse grind size of P80 250µm (¼ mm) gives the following results:

• Magnetite Concentrate Grade 94.8%  Fe Concentrate Grade 68.6%  Fe Recovered in processing 94.1%  Mass recovered in processing 49.4%

Grind Establishment Results showed that a grind size of 250µm was achieved in 101 seconds compared to 75µm in 870 seconds.

These results indicate a simple processing circuit comprising crushing, grinding and wet low intensity magnetic separation resulting in savings in both capital and operating costs.

The coarse grind size also simplifies handling logistics.

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Details

The Directors of Athena Resources Limited (ASX: AHN) are pleased to advise that the Company has received the testwork report from ALS Ammtec.

ALS Ammtec were engaged by Athena in April 2011 to undertake beneficiation testing on samples from the Byro magnetite deposit to provide supporting results to the testwork conducted at Changsha Research Institute of Mining and Metallurgy (“CRIMM”). Results from both studies are to be used to provide a scientific basis for decision-making regarding the future development and investment of the Byro Project.

A total of sixteen PQ drill core samples (approximately 80kg) and a composite RC Chips sample (approximately 12kg) were delivered to ALS Ammtec in May 2011. The testing was completed in July 2011 and the main points of the results are reported below.

Wet Low Intensity Magnetic Separation Results

Magnetite Grade in Concentrate
P80 250µm	94.8% Fe3O4
P80 150µm	97.9% Fe3O4
P80 125µm	98.5% Fe3O4
Fe Grade in Concentrate
P80 250µm	68.6% Fe
P80 150µm	70.8% Fe
P80 125µm	71.3% Fe
Fe Recovery
P80 250µm	94.1%
P80 150µm	93.7%
P80 125µm	93.1%
Mass Recovery
P80 250µm	49.4%
P80 150µm	47.4%
P80 125µm	46.5%

These results were achieved from an iron head grade of 35.5% Fe. Full results are in Appendix 1.

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Grind Establishment Testwork

From the Particle Size Distributions of the grind establishment test work a chart was produced indicating the potential for capital and power cost savings from the coarser grind size. Refer to following chart and Appendix 2.

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Comparative Grind Size by Company
300.0
250.0
250.0
200.0
150.0
100.0
75.0 75.0
50.0 38.5 40.0 40.0
32.0
25.0 25.0 23.0 25.0
0.0
AHN EMG GBG ACS FXR GRR IRD ARH MDX LML ROY
Company
microns
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Source : ASX Announcements

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Major Results from Beneficiation Testwork

• Unconfined Compressive Strength (UCS) recorded values of 139.9 and 153.7 Mpa and recorded a strength classification of strong.

• Bond Impact Crushing Work Index (CWi) recorded average value of 15.5 kWh/t with a maximum value of 21.5 kWh/t and a minimum value of 8.2 kWh/t.

• Apparent Relative Density recorded values of 3.52, 3.53 and 3.56 g/cc.

• Bond Ball Mill Work Index recorded a value of 16.5 kWh/t from a test aperture of 106 micron.

• Bond Abrasion Index recorded a value of 3.894

• Head assays were reported as;-

Sample	Fe %	SiO2 %	Al2O3 %	TiO2 %	MnO %	CAO %	P %	S %
Core	35.4	45.1	0.59	0.057	0.15	1.75	0.035	0.017
RC Chip	35.5	44.5	1.08	0.074	0.14	1.55	0.050	0.041

• An asbestiform analysis indicated the absence of asbestos or fibrous hazard.

These results confirm a relatively simple processing circuit is required for treatment of Byro magnetite ore.

The proposed processing circuit is likely to consist of the following:

• Conventional three stage crushing,

• Primary grinding and coarse classification,

• Wet low intensity magnetic separation at coarse grind,

• Secondary grinding and classification at P80 of 125 micron,

• Rougher wet low intensity magnetic separation,

• Cleaner wet low intensity separation,

• Concentrate thickening and filtration.

E W Edwards Managing Director

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About Athena Resources Limited

Athena Resources Limited (ASX:AHN), which is based in Perth, was listed on the ASX in 2007 and currently has 107 million shares on issue. Athena’s major asset is its 100% interest in the Byro Project where it is exploring for copper, nickel, PGE’s in addition to iron ore. The company also has significant gold, lead and silver targets in the Ashburton.

The Byro Iron Ore Project is located on the Carnarvon Mullewa road 250km NNE of Mullewa. It is some 100km west of the proposed Midwest Iron Ore Railway which is planned to link existing and future iron ore projects in the Mid-West Region to the proposed Oakajee deep water bulk shipping port north of Geraldton.

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Competent Persons Statement The technical information relating to Athena’s exploration projects was compiled by Mr Liam Kelly, an employee of Athena Resources Limited. Mr Kelly is a Member of the Australasian Institute of Mining and Metallurgy, and has sufficient relevant experience in the styles of mineralisation and deposit styles under consideration to qualify as a Competent Person as defined in “ The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2004 edition)”. Mr Kelly consents to this inclusion of the information in this report in the context and format in which it appears

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APPENDIX 1

WET LOW INTESTITY SEPERATION RESULTS

	WLIMS Separation 3	WLIMS Separation 3	WLIMS Separation 3	passes at 900 Gauss–Core Composite–P80 of 250µm	passes at 900 Gauss–Core Composite–P80 of 250µm	passes at 900 Gauss–Core Composite–P80 of 250µm	passes at 900 Gauss–Core Composite–P80 of 250µm	passes at 900 Gauss–Core Composite–P80 of 250µm	passes at 900 Gauss–Core Composite–P80 of 250µm	passes at 900 Gauss–Core Composite–P80 of 250µm
P80 250 µm	Wt Dist %	Fe Grade %	Fe Dist %	SiO2 Grade %	SiO2 Dist %	Al2O3 Grade %	Al2O3 Dist %	P Grade %	P Dist %	S Grade %	S Dist %
Mags	49.4	68.6	94.1	4.86	5.3	0.31	26.6	0.010	14.2	0.001	4.4
N Mag	50.6	4.19	5.9	84.4	94.7	0.81	73.4	0.059	85.8	0.021	95.6
Head	100	36.0	100	45.1	100	0.56	100	0.035	100	0.017	100

	WLIMS Separation 3	WLIMS Separation 3	WLIMS Separation 3	passes at 900 Gauss–Core Composite–P80 of 150µm	passes at 900 Gauss–Core Composite–P80 of 150µm	passes at 900 Gauss–Core Composite–P80 of 150µm	passes at 900 Gauss–Core Composite–P80 of 150µm	passes at 900 Gauss–Core Composite–P80 of 150µm	passes at 900 Gauss–Core Composite–P80 of 150µm	passes at 900 Gauss–Core Composite–P80 of 150µm
P80 150 µm	Wt Dist %	Fe Grade %	Fe Dist %	SiO2 Grade %	SiO2 Dist %	Al2O3 Grade %	Al2O3 Dist %	P Grade %	P Dist %	S Grade %	S Dist %
Mags	47.4	70.8	93.7	1.29	1.4	0.27	26.6	0.006	8.4	0.004	14.1
N Mag	52.6	4.28	6.3	83.8	98.6	0.82	73.4	0.059	91.6	0.022	85.9
Head	100	35.8	100	44.7	100	0.56	100	0.034	100	0.013	100

	WLIMS Separation3	WLIMS Separation3	WLIMS Separation3	passes at 900 Gauss–Core Composite– P80 of 125µm	passes at 900 Gauss–Core Composite– P80 of 125µm	passes at 900 Gauss–Core Composite– P80 of 125µm	passes at 900 Gauss–Core Composite– P80 of 125µm	passes at 900 Gauss–Core Composite– P80 of 125µm	passes at 900 Gauss–Core Composite– P80 of 125µm	passes at 900 Gauss–Core Composite– P80 of 125µm
P80 125 µm	Wt Dist %	Fe Grade %	Fe Dist %	SiO2 Grade %	SiO2 Dist %	Al2O3 Grade %	Al2O3 Dist %	P Grade %	P Dist %	S Grade %	S Dist %
Mags	46.5	71.3	93.1	0.86	0.9	0.27	22.3	0.004	5.4	0.003	9.8
N Mag	53.5	4.63	6.9	83.4	99.1	0.82	77.7	0.061	94.6	0.024	90.2
Head	100	35.8	100	44.7	100	0.56	100	0.034	100	0.013	100
	WLIMS Separation3			passes at 900 Gauss–Core Composite– P80 of 106µm
P80 106 µm	Wt Dist %	Fe Grade %	Fe Dist %	SiO2 Grade %	SiO2 Dist %	Al2O3 Grade %	Al2O3 Dist %	P Grade %	P Dist %	S Grade %	S Dist %
Mags	46.9	71.3	93.8	0.70	0.7	0.27	22.1	0.004	5.3	0.003	9.3
N Mag	53.1	4.16	6.2	84.0	99.3	0.84	77.9	0.063	94.7	0.026	90.7
Head	100	35.7	100	44.9	100	0.57	100	0.035	100	0.015	100
	WLIMS Separation3 passes				at 900 Gauss–Core Composite–				P80 of 75µm
P80 75 µm	Wt Dist %	Fe Grade %	Fe Dist %	SiO2 Grade %	SiO2 Dist %	Al2O3 Grade %	Al2O3 Dist %	P Grade %	P Dist %	S Grade %	S Dist %
Mags	47.5	71.7	93.8	0.55	0.6	0.27	21.9	0.003	4.1	0.004	11.1
N Mag	52.5	4.31	6.2	83.8	99.4	0.87	78.1	0.064	95.9	0.029	88.9
Head	100	36.3	100	44.3	100	0.59	100	0.035	100	0.017	100

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APPENDIX 2

GRIND ESTABLISHMENT TESTWORK

Grind Size P80	Grind Time	Grind Time	Basis
(μm)	(Minutes’ Seconds”)	Seconds
250	1’41”	101	Actual Measured
150	4’34”	274	Actual Measured
125	6’35”	395	Actual Measured
106	8’28”	508	Actual Measured
75	14’29”	869	Actual Measured
55		1,450	Calculated
35		3,000	Calculated

Calculated times are derived from an exponential line of best fit with a correlation of 99.68%

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