Straits Resources has entered a $5 million all-scrip option deal to offload its Whim Creek processing plant in the Pilbara to Sydney-based Finders Resources.
The announcement is below:
In a significant step in the development of the Wetar Copper Project, Finders Resources ('Finders') is pleased to announce that it has entered into a legally binding Heads of Agreement ('Agreement') covering the commercial terms of an option to acquire Straits Resources Limited's ('Straits') Whim Creek SX-EW plant.
The Agreement gives Finders the right to purchase the SX‐EW Plant and associated equipment at any time during the period 1 October 2009 to 31 December 2009. On the date of exercising the option, Finders will pay Straits A$5.0 million plus GST, payable in Finders fully paid ordinary shares. Straits will also be issued 724,638 fully paid Finders ordinary shares as the option fee for the Agreement.
The Whim Creek SX-EW Plant has a capacity of ~18,000 tonnes copper cathode per year and Finders will use these parameters plus an expansion of the existing 2,000 tonnes per year demonstration plant as the basis for the completion of the remainder of the project Feasibility Study.
Rob Thomson, Finders Director of Development said: "The planned acquisition of the SX-EW plant is a major milestone in the development of the Wetar Copper Project and adds robustness and greater certainty to the project economics.
The purchase of a proven operational SX-EW plant reduces much of the capital cost uncertainty and lead time uncertainty associated with building a new plant.
It is anticipated that the acquisition of the SX-EW plant will significantly reduce the overall capital cost of the project and the quantum of this benefit will be determined as part of finalising the feasibility study."
