IGO LIMITED — Capital/Financing Update 2005

Sep 1, 2005

圖: atlas@affasgold.com.au Wi: affasgold.com.au

$2^nd$ September 2005

ATLAS SUBSTANTIALLY INCREASES PILBARA IRON ORE GROUND POSITION

Atlas Gold Limited (ASX Code – AGO) announced today that it had reached agreement with Independence Group NL ('IGO") and their joint venture partners CO2 Group Limited ("CO2") to earn 100% of the iron ore rights on tenements totaling 490 $km^2$ immediately adioining Atlas' highly prospective Pardoo Iron Ore Project, located 75km east of Port Hedland, Western Australia.

The tenements host the South Limb Iron Ore Prospect and significantly increase Atlas' tenement interests in the region between Pardoo and the BHP Billiton owned Goldsworthy Iron Ore Project. Goldsworthy has produced in excess of 50 million tonnes of high grade (> 63% Fe) iron ore valued in excess of \$2 billion dollars (at current prices) since commencing production.

Atlas' managing director David Flanagan commented, "It is pleasing to have entered into an agreement with a highly successful mining company such as the Independence Group. This arrangement has increased our tenement interests in the Pardoo / Goldsworthy area by a factor of 3 times and delivers to Atlas a prospective and strategic ground holding between BHP's Goldsworthy Project and Atlas' Pardoo Project. We intend to move quickly to assess the economic potential of this new ground as we continue to build on our already pleasing initial drilling results from Pardoo".

Atlas recently announced results from its first pass drilling programme at its 100% owned Pardoo Iron Ore Prospect which surrounds BHP's Ord Ridley Iron ore deposits. Pardoo is ideally located next to the BHP Billiton Yarrie railway line and the sealed Great Northern highway and lies within 75 km of the public access port of Port Hedland.

A first pass drilling program (results reported 16^th August) at Pardoo produced;

Bobby Prospect PDRC061, 52 m at 60.6% Fe and 0.1% P from 6m, including 18 m at 62.4% Fe and 0.1% P from 12 m and 10 m at 62.2% Fe and 0.08% P

PDRC040, 22 m at 59.3% Fe, and 0.12% P from 4 m including 6 m at 60.9% Fe, and 0.13% P from 14 m

Dean Prospect PDRC065, 4 m at 60.3% Fe, and 0.17% P from 4 m

Connie Prospect PDRC057, 14m at 56.9% Fe, and 0.03% P from surface

As part of the agreement with IGO/CO2, Atlas will commence development within 4 years to earn 100% of the iron ore rights. Initial work will focus on the South Limb prospect, located in close proximity to Atlas other iron ore prospects.

The key terms of the agreement are;

• The "owners" refers to the IGO/CO2 joint venture.
• AGO pay the owners 100,000 shares for a 12 month option to evaluate the South Limb prospect and the other tenements.
• On exercising the option AGO transfer to the owners 2,000,000 AGO shares subject to voluntary 12 month escrow.
• AGO must commence development within 4 years of exercising the option to acquire 100% of the iron ore rights.
• The owners will retain a shared 2% gross sales revenue royalty.
• The owners will retain a once off right to claw back 30% equity for two times AGO's exploration spend across the tenement group if Atlas defines a resource exceeding 5mt.
• If AGO fails to commence development within 4 years it's equity interest reverts to 49% and exploration/development proceeds at the direction of a JV committee and standard dilution formulas apply.
• The tenements covered by this agreement are E45/2381, E45/2285, E45/2286 and E45/2380.

For further enquiries, please contact:

David Flanagan	Richard Revelins
Managing Director	-Chairman -
08 9476 7900	03 9824 8166

The information in this report that relates to exploration results is based on information compiled by Mr Mark Gunther who is a member of the Australian Institute of Geoscientists and is a full time employee of Atlas Gold Limited. Mark Gunther has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results. Mark Gunther consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.