Stirling Resources Limited (ASX:SRE)
Perth, May 6, 2009 AEST (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:
Principal: AUD$10,000,000Interest Rate: Fixed at 9.375% Payable quarterly in arrears Interest may be capitalized at DCM's discretionRepayment date: 3 yearsSecurity: 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.
Contact
Michael Kiernan
Managing Director
Tel: +61-8-6389-6800
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