Equatorial Resources Limited (ASX:EQX) Announce Institutional Placement To Raise A$25.6 Million

Perth, Dec 2, 2010 AEST (ABN Newswire) - Equatorial Resources Limited (ASX:EQX) are pleased to advise that the Company will make a placement to institutional investors of up to 14.2 million shares at $1.80 each to raise A$25.6 million before costs.

The placement is predominantly being made to two London-based clients of Morgan Stanley Smith Barney. These institutional clients are two of Europe's leading active asset managers.

The placement is being managed by Azure Capital Limited in collaboration with GMP Securities Europe LLP and Argonaut Securities Ltd. The placement will be completed in two tranches. The first tranche of 11.2 million shares will be issued immediately under the Company's existing capacity under Listing Rule 7.1. The remaining tranche of 3 million shares will be issued following shareholder approval at a general meeting to be held as soon as practical.

The funds raised will be used to accelerate the Company's drilling and other exploration activities at both the Mayoko-Moussondji Iron Project and the Badondo Iron Project in the Republic of Congo.

Commenting on the transaction, Mr John Welborn, Managing Director and CEO of Equatorial, said "We are extremely pleased to have attracted institutional investors of such high calibre. They will provide us with a significantly enhanced profile in the United Kingdom and European markets. Funds raised from the placement will put us in a very strong financial position and will allow Equatorial to continue to accelerate our exploration activities on both of our Republic of Congo projects. The quality of the strategic and institutional investors being attracted to our register is testament to the quality of the Company's iron projects in West Africa and reinforces both the high prospectively of our tenements as well as the importance of our access to rail and deep water port infrastructure."

Contact

John Welborn Managing Director & CEO Tel: +61-8-9322-6322 Email: info@equatorialresources.com.au http://www.equatorialresources.com.au