Pannawonica Iron Project Divestment Option with 1.5% Royalty

• Option agreement with Arrow Minerals for Pannawonica Iron Project divestment
• Red Hill retains 1.5% Gross Revenue Royalty on future iron ore sales
• $150,000 upfront option fee paid in shares

Red Hill Minerals Limited (ASX: RHI) has entered into a heads of agreement with Arrow Minerals Limited (ASX: AMD) for the proposed divestment of its 100%-owned Pannawonica Iron Project in the West Pilbara region of Western Australia. Under the terms of the agreement, Arrow Minerals will have an exclusive 12-month option to acquire 100% of the project tenement package. The option fee is $150,000 paid in shares of Arrow Minerals, calculated on the 20 Day VWAP prior to the agreement's execution. Red Hill will retain a 1.5% Gross Revenue Royalty on future iron ore sales from the project and an additional 0.25% Gross Revenue Royalty over iron ore produced from certain deposits outside the project tenements but within the Area of Influence.