Reinstalling OS X problem, help!

I am trying to reinstall the operating system for my Macbook, I just installed a new hard drive.
I put disc 1 in and the install screen pops up, but it will not let me select a 'destination volume to install the Mac OS X software' and the 'options' button is also gray (unavailable).
What am I doing wrong? Any suggestions anyone?
Thanks,
Angela

[Formatting & Partitioning a Hard Drive in OS X - Tiger and Leopard|http://www.kenstone.net/fcphomepage/partitioningtiger.html]
[Journaling, Zeroing, Partitioning & OS 9 driver|http://forums.bombich.com/viewtopic.php?t=4084]
[Kappy's extensive hard drive formatting post|http://discussions.apple.com/thread.jspa?messageID=8340551&#8340551]
[BDaqua's Formatting instructions|http://discussions.apple.com/message.jspa?messageID=8901255#890125 5]

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