Stirling Resources Limited (ASX:SRE) Reorganises Group Investment And Development Strategy

Perth, June 17, 2010 AEST (ABN Newswire) - West Australian resource developer Stirling Resources Limited (ASX:SRE) today announced a series of initiatives to reorganise the group's investment and development strategy.

Stirling is the major shareholder, owning and controlling:

Matilda Zircon Limited (ASX:MZI)   58%Swan Gold Mining Limited (ASX:SWA) 35%Redbank Copper Limited (ASX:RCP)   26%

Stirling's Managing Director, Michael Kiernan, commented that due to the current hiatus in sourcing funding for junior miners, as a direct result from the knock-on effect of the Resources Super Profits Tax debacle, we need to cut our cloth accordingly and adapt to the present climate.

"Our target is to reduce the group's overall corporate, administrative and overhead costs by bringing the copper and zircon projects together as business units of Stirling. This rationalisation will save some A$1.5m per year in corporate public company costs" he said.

Strategic Changes:

1. Stirling will seek to merge with Matilda Zircon and Redbank Copper. The terms and conditions of the proposed mergers are in the process of being negotiated.

2. Delay the recommencement of mining for Swan Gold.

3. Seek a significant strategic partner to continue the development of Swan Gold's Mt Ida and Carnegie projects.

4. Reduce board members.

Stirling: Jeremy Shervington and David Nabarro will step down.          Board will comprise of:          Michael Kiernan - Chairman          Rohtraut Skatsche-Depisch          James Kiernan          Giga BedineishviliMatilda:  Michael Kiernan, Bruce Maluish and John Baxter will step down.          Board will comprise of:          Mal Randall - Chairman          Peter Gazzard - Technical Director          Keith Vuleta          Nathan WongRedbank:  James Searle and Michael Kiernan will step down.          Board will comprise of:          Ian Price - Chairman          Bruce Morrin - Managing Director          Allan Brown          Keith VuletaSwan Gold: Bruce Maluish and John Baxter will step down.           Board will comprise of:           Michael Kiernan - Chairman           Ian Price           Allan Brown           Keith Vuleta

5. Re-listing Swan Gold

The original intention was to seek relisting in early May. This has been delayed by several months due to the requirement by statutory authorities for the 2 half yearly and 2 annual reports during the time of Administration to be prepared and audited.

This requirement took some 10 weeks of accounting catch up and auditing time costing in the order of A$500,000 of unexpected expense and delay.

The expense together with delays in mining start up and subsequent gold revenues has placed pressure on working capital.

Swan Gold was in the process of securing a A$10m funding package when the RSPT issue unfolded.

Notwithstanding these events are beyond the control of Swan Gold, Stirling Resources as the facilitator of the recapitalisation is mindful these delays are regrettable to those who participated in the recapitalisation process by acquiring Swan Gold stock.

In order to address this situation Stirling Resources intends to issue (at no cost), on a 1 for 10 basis, one Stirling share for every ten Swan Gold shares acquired from Stirling Resources during the recapitalisation of Swan Gold.

This will result in 12,850,831 new Stirling shares being issued by Stirling Resources, subject to compliance with the ASX Listing Rules and the Corporations Act.

It will now be a requirement of relisting for Swan Gold to demonstrate it has sufficient working capital to meet its commitments.

'Once funding is secured, relisting will be imminent. We anticipate this may take 1 or 2 months to complete' Mr Kiernan said.

Stirling Resources major shareholder DCM DECOmetal, considers the reorganisation appropriate and supports the strategic direction.

DCM's Managing Director, Dr Rohtraut Skatsche-Depisch commented "We think this is a good way forward particularly with the current difficulties confronting the Australian resources industry and we are totally supportive of Stirling's new strategy".

Contact

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