Atlas Iron expects to start production at its Wodgina DSO Project in the Pilbara region of Western Australia in January 2010 following a nine-month feasibility study.

The first exploration drill hole at the project was completed in November 2008 with an intention to begin mine development in just over 12 months, Atlas MD David Flanagan said.

Production is expected to begin at an initial rate of two million tonnes per annum (mtpa) quickly growing to 3.6mtpa in 2010, with trucking to the new Utah Point port facility in Port Hedland commencing during April 2010.

Flanagan said that the low strip ratios and the project’s location close to Port Hedland mean that the firm is very willing to invest in the project.

“The first exploration drill hole was completed at Wodgina in mid-November 2008. With mining commencing in January 2010 we intend to move from first drill hole to mine development in just over 12 months. This is a remarkable story and testament to the capabilities of our team” Flanagan said.

The project has required minimal capital outlay of just A$9.57m due to being able to leverage off the existing infrastructure at Talison Mineral’s Wodgina Tantalum mine, Atlas said.

Operating costs are expected to be between A$38 and A$45 per tonne over the course of the mine’s life.