Re: Press Release - Friday, September 25, 2009
Title: Palladon Ventures Announces Completion Of NI 43-101 Preliminary Economic Assessment For Portion Of Iron Mountain Project, With Us$766 Million Estimated Net Present Value And 24% Irr
Salt Lake City, UT, September 25, 2009. Palladon Ventures Ltd. ("Palladon" or the "Company") (CDNX: PLL.V) (Frankfurt: PV-1) is pleased to announce that it has received the NI 43-101 Preliminary Economic Assessment ("PEA") for the Comstock and Mountain Lion pits ("CML") and the adjacent stockpiles from SRK Consulting (U.S.), Inc. ("SRK"). The PEA does not address Palladon's other significant historic resources at the same Iron Mountain Project location.

Highlights:

On August 7, 2009, the Company announced its NI 43-101 Compliant Resource estimate for the CML pits and stockpiles. The indicated mineral resource estimate, as shown in Table 1, totals 40.35 million short tons at a grade of 45.32% Fe (Iron). The PEA addresses the technical and economic merits of a development option for CML and the stockpiles. Note that with reference to National Instrument 43-101, mineral resources that are not mineral reserves do not have demonstrated economic viability.

The Company is pleased to announce that the project's robust economics at the scoping study level justify moving forward with a feasibility study, which should be compete by the end of April 2010. The full PEA report has been filed and is accessible on SEDAR, as well as on the company's website, www.palladonventures.com. Leah Mach, Neal Rigby and Jeff Woods, all qualified persons under NI 43-101, endorsed the report.

The PEA is based on a production target of one million metric tons of direct reduced iron ("DRI") per year. No pre-stripping is necessary for either CML or the stockpiles. As discussed further below, Palladon will continue to study other product options and production rates.

The 40.35 million short tons of indicated resource translate into a fifteen year mine life, during which 37.5 million short tons at 43.3% Fe are mined, and 14.4 million metric tonnes of DRI are produced and sold at a modeled selling price of $378 / metric tonne, as follows.

Sensitivity:

Project sensitivities denoting Life of Mine NPV@ 8% are as follows (US$ in thousands):

Capital Costs:

1. Projected capital costs of $705 million include total contingency costs of $118.1million. Capital and contingency costs are summarized as follows.

Market for AIU*:

During 2007 U.S. demand for Alternate Iron Units ("AIU"*) was 8.7Mst (million short tons). Only 2% of this demand was met by domestic supply. DRI was 2.8Mst of the imported supply. (*Note: The category "Alternate Iron Units" is most commonly comprised of pig iron, direct-reduced iron (DRI) and iron nugget.)

Within 1,200 miles of Palladon's project location there are eight end users who purchase roughly 1.1Mst of AIU per year. In North America, there are 29 end users that use over 4.8Mst of AIU per year. Currently, the majority of this AIU requirement is met with either DRI or imported pig iron.

AIU market studies conducted for Palladon by Hatch Management Consulting ("Hatch") indicate that U.S. domestic mini mill demand could support the sale of up to 1Mstpa of AIU (DRI or nuggets) as a supplement to the charge mix. The scrap-short Asian market could also be a good source of demand for AIU. So estimated total market demand appears sufficient to support the annual 1Mtpa DRI production scope considered in this PEA report. SRK evaluated both nuggets and DRI, and both options are still being considered. DRI was used for the PEA because DRI is a more established product with more detailed information available. However Midrex's new ITmk3(r) nugget technology may have advantages in certain markets, particularly the Asian export market, due to ease of shipment compared to DRI.



Palladon CEO John Cutler stated:

"The PEA demonstrates a very attractive project, both in terms of technical feasibility and economic value. This brownfield expansion is supported by the existence of substantial infrastructure, including power to the site, roads and a fourteen mile rail spur line. Significant community support also exists at all levels -- city, county and state. The company is working to bring additional historic resources into compliance, which will further increase the potential for this project.

In its efforts to maximize shareholder value, Palladon continues to consider all options as to final product and appropriate production rates. For instance, a concentrate plant is required at the front end of an AIU plant, and concentrate production could be initiated prior to completion of the AIU plant, so the Company would evaluate any possibility to profitably ship concentrate. These options will be examined further as we continue toward completion of the feasibility study. Discussions with potential strategic and financial partners may also influence our production plans.

We are proud of the progress that we have made to quantify the potential for the Iron Mountain Project. We especially want to thank SRK for their extraordinary efforts to produce the PEA. A tremendous amount of coordination, planning, research and analysis went into generating such a detailed document.

Palladon expects to raise a minimum of US$5 million by October 15, 2009 in order to extend the Luxor debt to December 31, 2010. Completion of this funding will provide working capital, as well as funding for the bankable feasibility study that SRK expects to complete by late April 2010.

Finally, we look forward to our annual shareholder meeting, which has been scheduled for Monday, November 16 in Salt Lake City."

On Behalf of the Board of Directors,
John W. Cutler
President and Chief Executive Officer

About Palladon
Palladon Ventures Ltd. is a junior resource company focused on advancing the Iron Mountain Project, an iron ore mine located west of Cedar City, Utah.

For Further Information Please Contact:
John W. Cutler
President & CEO
Palladon Ventures Ltd.
801.521.5252 Tel
801.521.5454 Fax
Email: [email protected]
Website: www.palladonventures.com