After-Tax NPV8% Increases to US$4.1 Billion, IRR Increases to 20%

Cardero Receives Final Preliminary Economic Assessment Technical Report

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 10/29/08 -- Cardero Resource Corp. ("Cardero" or the "Company") (TSX: CDU)(NYSE-A: CDY)(FRANKFURT: CR5) is pleased to announce that SRK Consulting (Canada) Inc. ("SRK") has updated the recent Preliminary Economic Assessment for the Pampa de Pongo iron deposit. The increased NPV and IRR result from the positive MIDREX Direct Reduction material evaluation (See NR 08-25), which demonstrated the suitability of Pampa de Pongo iron oxide pellets as Direct Reduction (DR) process feed.

DR-grade pellets typically attract a premium of at least 10%, which has increased the after-tax NPV8% by approximately US$700 Million to US$4.1 Billion, and increased the real after-tax IRR from 18% to 20%. The life of mine project revenue, net of all off-site costs and project royalties and including copper and gold credits, is now estimated at US$ 46 billion, equating to average annual net revenue of US$ 1.93 billion. Life of mine net pre-tax operating cash flow is estimated at US$38.9 billion or US$1.6 billion average annually.

Site estimated operating costs are approximately 15.8% of net revenue, providing a very high project operating margin and are indicative of the robust project fundamentals. On a per tonne basis, the net revenue (pre-tax) after all off-site costs and royalties and including copper and gold credits is approximately US$140 per tonne of pellets sold, with the corresponding total cost of production approximately US$22 per tonne of pellets sold, yielding net operating cash flow per tonne of pellets produced of US$118.

The Company cautions that the PEA is preliminary in nature, and is based on 100% inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Accordingly, there can be no certainty that the results estimated in the SRK PEA will be realized. The PEA results are only intended as a preliminary first-pass review of the potential project economics based on a minimal amount of information. In addition, the cavability assessment of the deposit is preliminary as it is based on a limited number of drillholes and, as such, substantial work is required to verify the current caving and output assumptions.

MINERAL RESOURCES

The effective date of the mineral resource estimate is September 30th, 2008. SRK is not aware of any environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant issues that may affect the mineral resource estimate. The classified inferred mineral resource estimates at a 15% iron cut-off grade are shown in Table 1. The economic cut-off used to generate mineral resources was assumed and is based on experience with similar projects. The final cut-off required to produce a saleable product will need to be confirmed by future metallurgical test work. This economic cut-off was applied to both the Central and South Zones. Although the South Zones contribute a relatively small tonnage, SRK is of the opinion that there are reasonable prospects for additional tonnage in this area which could then make these resources amenable to underground mining methods. At the East Zone, a large magnetic anomaly, with potential for 350-500 million tonnes of conceptual mineralization is ready for drill-testing. A single drillhole, which tested the southern edge of the anomaly, intersected 292 metres of semi-massive to massive magnetite mineralization.

To view the table please click on the following link: http://media3.marketwire.com/docs/Mineralresources.pdf.

PRELIMINARY ECONOMIC ASSESSMENT TECHNICAL REPORT

SRK has delivered the final Preliminary Economic Assessment Technical Report to Cardero and the report will be filed with SEDAR forthwith.

REPORT CONCLUSIONS

The results of the preliminary economic assessment, based on the currently available data and the assumptions used, demonstrate that Pampa de Pongo is an economically robust project that warrants further development. The project is situated in a very favourable location, a short distance from critical infrastructure, including a deep-sea port facility, located 38 kilometres west of the deposit on the Pacific coast of Peru.

Drilling and magnetic surveys indicate the presence of a large, massive magnetite mineralized Central Zone that is conducive to underground bulk mining. The South Zone resource and other exploration targets have a good to excellent possibility to enhance the total material available for exploitation. Further exploration of the East Zone, if successful in outlining 350-500Mt of conceptual mineralization, could allow concurrent development with Central Zone, significantly increasing the overall mineral resources, pellet production tonnage and revenue.

The successful metallurgical test work completed for the Central Zone mineralization indicates that Pampa de Pongo iron oxide pellets will exceed the stringent requirements of blast furnace and direct reduction end-users. The Pampa de Pongo pellets contain exceptionally low levels of deleterious elements - a factor which should significantly enhance their saleability.

MINING

The mine was designed for and will support a production rate of 75,000 tonnes per day or 27.4 million tonnes per year. The mine production life is 24 years and includes a 5-year straight-line production ramp-up. Alternatively, modifications to the current preliminarily mine production plan could result in revised production rates and a corresponding change in the predicted economic results.

An analysis of open pit and underground mining scenarios lead to the conclusion, based on the current data and assumptions, that an underground block cave mine would provide the most favourable economic results.

PRELIMINARY ECONOMIC ASSESSMENT RESULTS

Four cases were used in the cash flow analysis to demonstrate the variation of project economics with metal price. All other variables were kept constant for all cases including the life of mine mill feed tonnes and grade. The four cases all used the assumption that pellets would be the final product. Case 1 assumes sale of blast furnace pellets while the other cases assume sale of direct reduction pellets. Pellet prices were obtained from an independent market study, the 3-year average and reference public-domain reports.