Awaits Positive Impact on Independent Preliminary Economic Assessment

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 10/20/08 -- Cardero Resource Corp. ("Cardero" or the "Company") (TSX: CDU)(NYSE-A: CDY)(FRANKFURT: CR5) is pleased to announce highly positive results from direct reduction testing of Pampa de Pongo pellets at MIDREX® Technologies Inc. in the USA. Results indicate metallurgical and chemical properties of the pellets produced from the Pampa de Pongo iron deposit exceed industry standards for premium, high-quality Direct Reduced Iron (DRI) or Hot Briquette Iron (HBI) feed.

Direct Reduction (DR) grade pellets are premium products and typically attract higher-value contracts than Blast Furnace grade pellets. The premium is typically 10% in terms of contract price, which the Company anticipates will have a positive effect on the final independent Preliminary Economic Assessment Technical Report, due for publication by the end of October. Previous price assumptions (see NR08-23) will be increased by 10% and the final report will include this expected economic upside.

In its report, MIDREX® indicated that "The Cardero Pampa de Pongo DR pellets performed well in standard Midrex tests. Chemical and physical characteristics were comparable to commercially produced pellets that have been used successfully in the Midrex DR Process®. Based on these results, it is expected that commercially produced pellets made from this ore would be a suitable feedstock for the Midrex DR Process®."

Maximum MIDREX® DR plant productivity is achieved by operating the shaft furnace with inlet gas temperatures ranging from 900-970 degrees C (or higher). Lime coating of DR pellets is required when operating under higher temperature conditions, mitigating burden sticking and clustering. The results posted from the 927 degree C hot load test prove that the lime coated Pampa de Pongo pellets are a satisfactory feed material for a Midrex DR plant operating under the most severe conditions.

DIRECT REDUCED IRON (DRI)

Direct Reduced Iron (DRI) is a high-quality iron product created through the removal of oxygen (reduction) from iron oxide material, in solid state (without melting). Reduction is achieved when a reducing gas (typically hydrogen and carbon monoxide) is passed through the iron oxide feed material at a temperature between 900 degrees and 970 degrees C. Direct Reduction Iron is commonly used in an Electric Arc Furnace (EAF) to produce steel, instead of, or in combination with, scrap iron. The DRI process requires specific physical and chemical quality feedstock, which must remain consistent as a product. Only a small percentage of pellets produced globally can meet the stringent requirements.

MIDREX® MATERIAL EVALUATION

Oxide Pellet Characteristics

Chemical and physical analysis of the Pampa de Pongo iron oxide pellets was repeated prior to DR material evaluation. All results were comparable to those previously described (see NR08-24).

DRI Characteristics

In order to determine the suitability of the Pampa de Pongo pellets as DR process feed, MIDREX® undertook a Linder Test and a Hot Load Test.

Linder Test

The purpose of the Linder Test is to determine the iron oxide pellet's susceptibility to generate unwanted fines during the course of bed movement in the shaft furnace. Potential for fines generation is due to furnace rotation (simulating bed movement in the shaft furnace) and carburization of the iron oxide material during reduction (which can contribute to fines generation). Fines are defined as less than 3.36 mm material (6 mesh).

The Linder Test was performed on uncoated pellets. Results were positive, with more than 94% metallization and approximately 1.8% carbon in the DRI product. Fragmentation was low, at less than 1.5%.

                                                       Uncoated
                                                            760
Linder Test                              Typical DRI  degrees C
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% Metallization                    greater than 93.0%      94.4
% Carbon                                                   1.79
Fragmentation % less than 3.36 mm      less than 2.0%       1.4
Compression (kg)                   greater than 67.0         38
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Metallization and fragmentation exceeded typical DRI product. Compression was lower than optimal.