PALLINGHURST RECEIVES FURTHER SHARES IN JUPITER MINES LTD

HAMILTON, Bermuda - 02 September, 2009 - Pallinghurst Resources (Guernsey) Limited (Ticker: PALLRES.BH) is pleased to announce that its steel feed joint venture partner, AIM-listed Red Rock Resources plc ("RRR") has met the conditions for the transfer of certain manganese tenements to ASX-listed mining explorer Jupiter Mines Limited ("Jupiter"), which will result in PRL receiving a further 26,845,017 shares in Jupiter for no additional consideration. Further background to the transaction and the details of the "manganese option" can be found in the Company's press release dated 10 March 2009, entitled "Acquisition By The Company And Red Rock Resources plc of an Interest in Jupiter Mines Limited".

Jupiter transaction announced on 10 March 2009

A summary of the impact on the Company of the first stage of the Jupiter acquisition transaction, whereby the Company initially vended 11,671,175 Mindax Limited ("Mindax") shares and AUD1 million into Jupiter in exchange for 47,339,148 Jupiter shares, the "manganese option" and the "Mount Alfred bonus option" (both as described below) on 30 March 2009, is as follows:

The indicative amounts for the fair value of assets acquired and fair value of consideration per the 10 March 2009 announcement were based on the relevant Jupiter and Mindax share prices and US$/ AUD rate on 9 March, the date the transaction went unconditional.  The actual transaction calculation is based on the share prices and US$/ AUD rate on 30 March 2009, the date of the completion of the transaction.

Receipt of 26,845,017 further shares in Jupiter on 1 September 2009

As part of the Jupiter transaction announced on 10 March 2009, within two years, the Company could receive a further 26,845,017 Jupiter shares and RRR a further 54,155,579 Jupiter shares, if certain manganese tenements were granted to RRR and unencumbered title to those tenements were transferred from RRR to Jupiter (the "manganese option"). 

The terms of the manganese option have now been met, and the Company has received the 26,845,017 additional shares in Jupiter on 1 September 2009 for no further consideration. 

A summary of the fair value gain to the Company as a result of the issue of the new Jupiter shares is as follows:

As part of the transaction terms, the new Jupiter shares are being held in escrow for a period of twelve months from the issue date.

Net fair value gain on the Jupiter acquisition

The net fair value gain on the Jupiter acquisition at 1 September 2009 is therefore US$3,809,733 based on the excess of the fair value of total consideration received in both stages of the transaction, less the fair value of total consideration paid.

Pro forma effects of the transaction on the Company:

The impact of the net fair value gain on the Jupiter transaction of US$3,809,606 on certain key elements of the Company's financial information from the most recent published financial statements (at 31 December 2008) is illustrated below: 

The table is the responsibility of the Directors of the Company.

Unrealised fair value gain on 47,339,148 Jupiter shares acquired in March 2009

Shareholders should also note that there is a significant unrealised fair value gain associated with the 47,339,148 shares issued to the Company by Jupiter on 10 March 2009.  The cost of these shares is US$3,283,018, whereas the current fair value of these shares is US$7,361,303.  The current unrealised fair value gain is US$3,382,220, and the unrealised foreign exchange gain is US$696,065.

As these unrealised gains are not directly related to the transaction to acquire shares, these impacts have not been included in the pro forma effects table above.

Further outstanding Jupiter transaction terms- the Mount Alfred bonus option

In addition, as part of the original terms of the Jupiter transaction, within two years, the Company and RRR could still be issued, in equal proportions, up to an additional 180 million Jupiter shares depending on the amount of saleable direct shipping hematite ore resource certified to be existing on Tenement E29/581, known as the Mount Alfred Project (the "Mount Alfred bonus option"), subject to a minimum of ten million tonnes.

Current holding in Jupiter by PRL and its associated companies

Following receipt of shares in return for meeting the terms of the manganese option, PRL will own 92,899,165 shares, approximately 28.91% of the issued share capital of Jupiter.  RRR own a further 28.97%.

The Company further announced on 1 July 2009 that, subject to approval by Jupiter shareholders, a Pallinghurst co-investor, Posco Australia (Pty) Ltd ("POSCO") has agreed to invest AUD7.81 million in Jupiter in exchange for 48,000,000 new shares, or 12.99%. 

The injection will dilute the ownership interest of PRL to 25.15%, and RRR to 25.21%.  Assuming the POSCO equity injection receives approval by Jupiter shareholders at the General Meeting to be held on 21 September, the Company, POSCO and RRR will therefore jointly control 63.35% of Jupiter.

Comment from PRL's CEO:

Pallinghurst CEO Arne H. Frandsen said: "We were always confident that the terms of the manganese option would be met; nonetheless, this is clearly excellent news for shareholders, and is in line with PRL's strategic objectives.  We now look forward to Jupiter fulfilling its potential and becoming a significant iron ore producer."

For further information please contact:

Arne H. Frandsen                 +44 778 752 1871