IRON BEAR RESOURCES LTD — Capital/Financing Update 2008

May 28, 2008

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29 May 2008

The Company Announcements Office ASX Limited

Via E Lodgement

MCC RECEIVES NO OBJECTION FROM FOREIGN INVESTMENT REVIEW BOARD FOR PROPOSED ACQUISITION OF CAPE LAMBERT PROJECT

HIGHLIGHTS

• China Metallurgical Group Corporation (“MCC”) has received confirmation of no objection from the Foreign Investment Review Board (“FIRB”) in respect of its proposed acquisition of the Cape Lambert Iron Ore Project.

• The Company, Officers from MCC and their representative legal advisors are currently negotiating the terms of the Sale Agreement.

BACKGROUND

Cape Lambert Iron Ore Limited (“Cape Lambert” or the “Company”) (ASX: CFE , AIM: CLIO ) is an Australian iron ore and exploration development company, which owns 100% of the Cape Lambert Iron Ore project (the “Project”), located in the Pilbara region of Western Australia. The Project currently has a 1.56 billion tonne JORC[1] compliant magnetite iron ore resource[2] , which is at feasibility stage and subject to an offer for purchase by MCC.

Further to the Company’s announcements dated 29 April 2008 and 21 May 2008 in which it advised the anticipated date for FIRB’s decision was on or before 28 May 2008, the Company is pleased to advise that it has now received written confirmation from MCC’s Australian legal advisor that FIRB has no objection (on an unconditional basis) to MCC’s application in respect of its proposed acquisition of the Project.

The Company also advises that negotiations in respect of the Sale Agreement are progressing with officials from both the Company and MCC currently working together to seek to finalise the terms of the agreement.

A notice of meeting is currently being prepared, for the purpose of obtaining Cape Lambert shareholder approval of the sale, and will be provided to shareholders in the coming weeks, subject to the successful conclusion of negotiations on the Sale Agreement.

Yours faithfully Cape Lambert Iron Ore Limited

Ian Burston Executive Chairman

1The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves as may be amended from time to time.

2Refer ASX and AIM release dated 30 January 2008 for full details of the mineral resource including classification and competent persons attribute.

Cape Lambert Iron Ore Limited ASX Release

29 May 2008 Page 2 of 2

FOR MORE INFORMATION PLEASE CONTACT :

Cape Lambert Iron Ore Limited:

Ian Burston +61 (0)8 9211 0600 Tony Sage +61 (0)8 9380 9555 Australian Enquiries: Professional Public Relations David Tasker +61 (0)8 9388 0944 UK Enquiries: Nominated Adviser: Grant Thornton UK LLP Fiona Owen +44 (0)20 7383 5100

AIM Broker:

Collins Stewart Europe Limited Adrian Hadden Oliver Quarmby

+44 (0)20 7523 8353 +44 (0) 20 7523 8354

Conduit PR: Jos Simson +44 (0)20 7429 6603/+44 (0)7899 870 450 Jane Stacey +44 (0)20 7429 6606

Cape Lambert Website: www.capelam.com.au

MCC Website:

www.mcc.com.cn