Stirling Resources Limited (ASX:SRE) Quarterly Report For The Period Ended 31 December 2009
Stirling Resources Limited (ASX:SRE) Quarterly Report For The Period Ended 31 December 2009

Perth, Jan 29, 2010 AEST (ABN Newswire) - Stirling Resources Limited (googlechartASX:SRE) is pleased to provide the Quarterly Activities Report for the period ended 31 December 2009.

Overview

During the December quarter the Company continued its approach to identify projects that comprise either commodities that are considered to have a strong future and 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, focusing on copper, zircon and gold.

The Company continued with this philosophy with its development of Redbank Copper Limited (googlechartASX:RCP) in which Stirling currently holds 26% and Matilda Zircon Limited (googlechartASX:MZI) in which Stirling's shareholding is 63%. During the quarter, the Company issued a renounceable rights issue prospectus to raise funds for the recapitalization of Monarch Gold Mining Limited (googlechartASX:MON) and recommencement gold mining operations.

Redbank Copper

Redbank holds a substantial ground position (approximately 3,600km2 granted or under application) including the centre of the Redbank Mineral Field which hosts significant economic copper mineralisation and is highly prospective for copper, cobalt, phosphate, manganese and uranium.

The Redbank Copper Project is located in the Northern Territory McArthur River Basin, some 30km from the Queensland border and 70km south of the Gulf of Carpentaria.

Exploration

On 8th December 2009 Redbank presented a new resource statement for its Redbank Copper Project located in the South McArthur Basin in the Northern Territory. The total Indicated and Inferred JORC Resource is now 6.24Mt @ 1.5% Cu for 95,900 tonnes of contained metal. This includes an Indicated Resource of 2.76Mt tonnes at 1.6% Cu and Inferred Resources of 3.48Mt tonnes at 1.5% Cu. The new Resource was generated from work completed by independent consultants SRK, following Redbank's 2009 field program.

Highlights of the resource upgrade include a 28% increase in total copper metal to 95,900 tonnes and a 50% increase in Indicated Resource to 2.76Mt. The average copper grade has been increased by 10% to 1.54% Cu, with a notable 30% increase in grade at the Sandy Flat deposit. It also includes a maiden Inferred Resource calculation for the new Roman Nose discovery (1.29Mt @ 1.4% Cu). The cost of discovery for the new resource increase equates to around A$0.04/lb of copper defined. During 2009, Redbank discovered five new mineralised pipes of which Camp Valley, San Manuel, Quartzite and the undrilled regional prospect GC2 were not included in current Resource calculations, but may contribute with further drilling.

In excess of 20,000m of RC and diamond drilling is planned for next year, and will include drilling of additional shallow oxide targets (less than 50m depth) at known prospects, and at more than 20 defined soil anomalies within ERL94. The 2010 exploration programme will also test possible sulphide pipes to 150m depth below these shallow oxide targets, and the Company is planning a deeper drilling program to test high grade sulphide targets available to 300m in defined pipes.

The source of copper mineralisation will also be tested by deep drilling (some 500m vertical) through the Wollogorang formation and beyond.

Agreement for US$7.5M Development Funding

On 11 December 2009 Redbank announced an agreement with La Jolla Cove Investors Inc, a US based institutional investor for the issue of up to five convertible notes each with a face value of US$1,500,000 to raise US$7,500,000. The funds raised through the convertible notes will be used in the construction of the SX-EW plant and general working capital.

Matilda Zircon

Project Strategy

Matilda's strategy is to develop the advanced zircon projects in the Tiwi Islands and the leucoxene project at Keysbrook to provide an immediate revenue stream.

Mining in the Tiwi Islands is scheduled to commence in April 2010 and at Keysbrook in 2011.

Tiwi Islands

In late 2009 a major Study was carried out on the mining of the Lethbridge South and Lethbridge West deposits on the Tiwi Islands. This Study made the following recommendations in order to increase the financial return:

- Conduct mining using a loader and excavator into a near pit screening and slurrying unit

- Mine the lower grade Lethbridge South deposit at 300 tph instead of the current 150 tph mining capacity

Having considered the recommendations of the Study, the Board has approved the construction of a screening/slurrying unit and a 300 tph pre-concentrator.

Work on the Slurry/Screening unit commenced in December 2009 and work on the pre-concentrator is planned to start in January 2010.

Keysbrook

The Keysbrook Project consists of a low overburden and clay deposit with a reserve of 41m tonnes (Proven 39m tonnes, Probable 2m tonnes) at 2.7% to produce approximately 1.2mt Heavy Mineral Concentrate. The deposit is unusual in that it has leucoxene as its major constituent which makes the heavy mineral suite of higher value than the ilmenite dominated deposits normally found in south-west of Western Australia.

In October 2009 the Western Australian Minister for the Environment approved the Keysbrook project.

The Company is now finalising applications for Development Approval for the two shires over which the Keysbrook deposit lies. These applications will be submitted in January/February 2010. Once these approvals are granted Matilda plans to obtain project finance and start development of the mining operations in mid 2010 with mining to commence in 2011.

Monarch Gold (to be renamed Swan Gold)

Earlier in the year, Stirling reached agreement with Administrators Pitcher Partners to inject funds into Monarch to recommence operations at the Carnegie and Mt Ida gold projects in the WA Goldfields. Monarch shareholders in September approved the proposal, which is based on a total consideration of ultimately A$55 million. Shareholders also approved the change of name to Swan Gold Mining Limited.

Corporate

Rights Issue

During the quarter, Stirling has issued a pro-rata rights issue prospectus to raise approximately $9.8million to finalize the recapitalisation of Monarch Gold, and the commencement of its gold operations near Kalgoorlie.

The Offer was made as a Renounceable entitlement issue of one new share for every share held, with an issue price of A$0.15 per share. It also includes one free attaching option for every share issued, with a strike price of A$0.15.

For the complete Stirling Resources Quarterly Report for the period ended 31 December 2009, please click the link below:

http://www.abnnewswire.net/media/en/docs/62177-ASX-SRE-478212.pdf

Contact

Michael Kiernan
Managing Director
Tel: +61-8-6389-6800



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