Victory West Moly Limited (ASX:VWM) USSU Nickel Project Update - Construction and Development Activities To Commence
Activities will include clearing and commencement of earthworks for the:
- Initial Mining Area
- Mine roads
- Mine stockpile area
- Port Haul Road
- Port Area
Previously announced was an 80 hole drilling program targeting an inferred JORC by 1st QTR 2011, which is still on target. Currently the drilling program has been extended to include tight spaced drilling, nominally 25m x 25m in higher grade areas that will define the initial mining areas for the DSO operation.
Also importantly, Victory West has now completed its Legal Due Diligence on the USSU Nickel Project and Oceantide Investments Pty Ltd (100% to be acquired by Victory West) has executed a formal memorandum of agreement ("MOA") with the local Indonesian vendors of PT Primara Utama Lestari ("PT PUL") (Oceantide to acquire 70% equity) and are in the process of finalizing key transaction agreements (including conditional sale and purchase of shares agreement, new articles of associations and shareholders agreements) and will work expeditiously to facilitate the conversion of PT PUL into a PMA Company (foreign investor company).
The Company is to hold a General Meeting of Shareholders in early April 2011 to seek the approval from shareholders for the acquisition of the 70% equity interest in the USSU Nickel project through the 100% acquisition of Oceantide, and is on track to lodge the Notice of Meeting (NOM) next week.
The NOM will also include a Solicitor's Report from Christian Teo & Associates the Company's Indonesian lawyers (legal report) and an Independent Geologist Report from GMT Indonesia the Company's Indonesian Geological Consultants.
About the USSU Nickel Project
The USSU Nickel Project is a highly prospective exploration IUP concession (The "Concession" or the "Project") covering approximately 1,608 hectares located in Malili East Luwu in South Sulawesi and located within a prolific nickel laterite province with several existing major operations nearby (including Rio Tinto's (ASX:RIO) (PINK:RTPPF) 162Mt project and PT Inco's Sorowako 161Mt project).
The Project is held by Indonesian entity PT. Primara Utama Lestari ("PT PUL") and VWM is in the process of finalizing the acquisition of the 70% equity interest in PT PUL.
USSU Nickel - Key Project Highlights
- The Project is considered highly prospective with an initial exploration target of 40-50Mt @ 1.50-1.60% Nickel(1) (across both Limonite & Saprolite Horizons)
- Less than 40% of the concession has been explored providing significant further upside.
- Located close to a port site (~3km's) and historical exploration work indicates potential low stripping ratio with well-developed mineralization at surface.
- Early commercialization through direct shipping ore (DSO) high grade saprolite nickel ore.
- Favourable economics - potentially low cost and rapid ramp-up to commercial production and cash flow.
- Feasibility and Environmental Studies in progress for Production and Operational IUP (Exploitation) concession application
- Robust market for Direct Shipping Ore (DSO) nickel ore and continued strong nickel demand from key Asian markets.
(1) In accordance with Clause 18 of the JORC Code, it is important to note that no JORC Mineral Resources or Ore Reserves have been established on these tenements and the potential quantity and grade is conceptual in nature, there has been insufficient exploration to define a Mineral Resource, and that it is uncertain if further exploration will result in the determination of a Mineral Resource.
Victory West Metals Limited
Rio Tinto Limited