Perth, May 6, 2009 (ABN Newswire) - Australian resources developer Stirling Resources Limited (ASX:SRE) announced today it has concluded an agreement with international commodity trading group and strategic partner DCM DECOmetal GmbH to fund the Company's expanding zircon portfolio.
DCM (http://www.dcm-vienna.com) will provide the funding to Stirling's wholly owned subsidiary Stirling Zircon Pty Ltd. A summary of the key terms and conditions are:
Stirling Resources Managing Director Michael Kiernan said the agreement was a strong endorsement in the future of the zircon industry, the potential of the Matilda assets and the strategic direction of Stirling.
The Tiwi Islands project, currently on care and maintenance, has historically produced 46,000 tonnes of zircon concentrate grading 50% zircon.
The Cape York Zircon Project, north of Weipa in Queensland, includes more than 300 kilometres of prospective coastline. Previous preliminary exploration has identified high grade zircon occurrences and significant strandlines, with potentially low strip ratios and low slime levels.
"The Cape York Peninsula and Urquhart Point area potentially encompasses what is arguably the largest unexplored prospective mineral sands terrain in the world," Mr Kiernan said.
"We retain a very positive outlook for the zircon market, with demand continuing to be supported by the global urbanization trend, particularly in China, and believe Stirling will be well positioned to capitalize on these opportunities," Mr Kiernan said.
Zircon together with gold is one of the very few commodities that have remained firm with the price increasing over the last 12 months to currently be in the order of US$850 - $900 per tonne.
Mr Kiernan said Stirling have in place a five year strategic development plan, with targeted production goals in the commodities of copper, zircon, gold, coking coal and iron ore. Over the next five years, Stirling is targeting to build up production of zircon concentrate to the equivalent of 50,000 tonnes per annum.
DCM (http://www.dcm-vienna.com) will provide the funding to Stirling's wholly owned subsidiary Stirling Zircon Pty Ltd. A summary of the key terms and conditions are:
Principal: AUD$10,000,000
Interest Rate: Fixed at 9.375%
Payable quarterly in arrears
Interest may be capitalized at DCM's discretion
Repayment date: 3 years
Security: Fixed and floating charge over the assets of
Stirling Zircon (subject to shareholder approval)
The funds will be used to complete the mineral sands assets acquired from Matilda Minerals Limited (ASX:MAL), recommence mining at the Tiwi Islands zircon project, undertake a significant exploration programme on the highly prospective Cape York tenements and provide funding for Olympia Resources Limited (ASX:OLY).Stirling Resources Managing Director Michael Kiernan said the agreement was a strong endorsement in the future of the zircon industry, the potential of the Matilda assets and the strategic direction of Stirling.
The Tiwi Islands project, currently on care and maintenance, has historically produced 46,000 tonnes of zircon concentrate grading 50% zircon.
The Cape York Zircon Project, north of Weipa in Queensland, includes more than 300 kilometres of prospective coastline. Previous preliminary exploration has identified high grade zircon occurrences and significant strandlines, with potentially low strip ratios and low slime levels.
"The Cape York Peninsula and Urquhart Point area potentially encompasses what is arguably the largest unexplored prospective mineral sands terrain in the world," Mr Kiernan said.
"We retain a very positive outlook for the zircon market, with demand continuing to be supported by the global urbanization trend, particularly in China, and believe Stirling will be well positioned to capitalize on these opportunities," Mr Kiernan said.
Zircon together with gold is one of the very few commodities that have remained firm with the price increasing over the last 12 months to currently be in the order of US$850 - $900 per tonne.
Mr Kiernan said Stirling have in place a five year strategic development plan, with targeted production goals in the commodities of copper, zircon, gold, coking coal and iron ore. Over the next five years, Stirling is targeting to build up production of zircon concentrate to the equivalent of 50,000 tonnes per annum.
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About Stirling Resources Limited
Stirling Resources Limited (ASX:SRE) is a West Australian resources developer focusing on investment and development of copper, zircon, coking coal, gold and iron ore projects. The Company consists of highly experienced resource development and mining personnel with track records of creating shareholder value.
Previously the group took control of a financially distressed manganese producer and developed it into a diverse mineral commodity producer to become included in the ASX 200 and was ultimately taken over by an international conglomerate for A$1.25b. The Company grew from being a small unreliable manganese producer to ultimately supplying 10% of the world's high grade manganese to global customers and developed significant projects in chromite, nickel, copper, zinc and iron ore.
The Company's strategy for creating shareholder value is to identify projects that comprise either commodities that are considered to have strong future demand or geological characteristics that have potential and yet for various reasons have not achieved their possibilities. The focus is on brown fields projects close to development or production.
Driven by the underlying fundamentals of the Chinese economy and the continued massive urbanisation process commodities such as copper, zircon, gold and iron ore will continue to be in strong future demand. The Chinese growth is augmented by the Indian economic growth particularly in the steel industry leading to increasing demands of coking coal.
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