Cazaly Resources has sold more than half of its interest in its Hamersley Iron Ore project near Tom Price to Saint Istvan Gold for $4 million.
Cazaly Resources has sold more than half of its interest in its Hamersley Iron Ore project near Tom Price to Saint Istvan Gold for $4 million.
Cazaly will continue to manage and operate the project and SVG will contribute $6 million toward a feasibility study.
SVG can earn an initial 51 per cent interest in the project by immediately paying $100,000, a further sum of $300,000 within 14 days and a final payment of $3.6 million within 60 days.
SVG can buy the project outright by paying Cazaly 50 cents a tonne of its participating interest in a JORC compliant mineral resource within 18 months or $1 a tonne after that.
The current inferred resource for the project is 143 million tonnes at 52.6 per cent iron.
See company statement below:
Cazaly Resources Limited's (ASX: CAZ), through its wholly owned subsidiary Cazaly Iron Pty Ltd, is pleased to announce the sale of a 51% interest in its Hamersley Iron Ore project to ASX listed company Saint Istvan Gold Limited (ASX:SVG).
SVG has the right to earn an initial 51% interest in the project by paying an immediate sum of $100,000, paying a further sum of $300,000 within 14 days and, a final payment of $3,600,000 within 60 days. In addition, CAZ will manage and operate the project with SVG to provide funding towards a feasibility study of up to $6 million expected within 3 years or less. During this period, CAZ's interest in the project is effectively free carried.
SVG also has the right to purchase 100% equity interest in the project by paying CAZ $0.50/tonne of its participating interest in a JORC compliant mineral resource within 18 months or, if between 18 months and 36 months, by the payment of $1.00/tonne of CAZ's participating interest in a JORC compliant mineral resource. Current inferred resources for the project are stated at 143mt @ 52.6% Fe (55.6% CaFe).
The Directors of CAZ are pleased to have entered into this agreement with SVG as it will allow the Company to leverage its position to exploit the huge potential offered at its Hamersley Project whilst focussing on its Parker Range Iron Ore Project.
SVG's Board includes former Premier of New South Wales, The Hon. Neville Wran AC QC, geologist and independent non-executive Director Mr David Coad and investment banker Mr Albert Wong (Chairman), former Founding Chairman of Pluton Resources Limited (ASX: PLV) and current Deputy Chairman of Prima Biomed Ltd (ASX: PRR).
Under the agreement CAZ's Managing Director Mr Nathan McMahon will join the SVG Board along with Sydney mining executive Mr Benjamin H Cooper who will become SVG's Executive Director.
The Hamersley Project hosts the Winmar iron ore deposit located approximately 50km NE of Tom Price in the Pilbara Region of Western Australia. The project is well placed amongst existing infrastructure and lies immediately south of FMG's Solomon project. In an announcement dated 10th October 2010 Fortescue Metals Group Limited (ASX:FMG) announced a refinancing package and restated that a Stage 1 Feasibility Study has been
completed for a 60Mt per annum project with initial development awaiting final board approval.
The Company previously recognised potential for the area to host Channel Iron Deposits (CID's) akin to those occurring at Solomon. Exploration over the first of these targets resulted in the discovery of the mineralisation at Winmar from which a maiden resource of 143mt @ 52.6% Fe (55.6% CaFe) was announced in June this year. Much of the target has yet to be fully explored with just 1.5km of the total approximate 2.8km target strike length having been drilled to date.
