Sundance Resources Ltd are set to accelerate the pre-feasibility study on development of its Mbalam Iron Ore project after the appointment of mining executives, George Jones, Don Lewis and John Saunders to its board and a proposed $20 million capital rais
Perth-based iron ore company Sundance Resources Ltd are set to accelerate the pre-feasibility study on development of its Mbalam Iron Ore project after the appointment of mining executives, George Jones, Don Lewis and John Saunders to its board and a proposed $20 million capital raising.
The funds will be used on the pre-feasibility study of the Mbalam Iron Ore Project in Cameroon and for general working capital. Sundance is targeting completion of the study in July 2007.
Mr Jones was previously chairman of Portman Mining Ltd and is currently executive chairman of Australian iron ore company, Gindalbie Metals Ltd.
Mr Lewis was previously managing director of Multiplex Engineering Pty Ltd, he was involved in projects including the $350m Moma Mineral Sands project in Mozambique and the $300m Perth Seawater Desalination project in WA.
Dr Saunders' has been involved in leading project and infrastructure development including a 500,000 tpa steel mill in Vietnam and a 750MW hydro project in Nepal.
Commenting on his appointment to the Sundance Board, Mr Jones said he was attracted by the size and grade of the Mbalam iron ore deposits and their potential to underpin a high-quality, low-cost export business for high-grade hematite direct shipping ore.
"Sundance has been able to secure a unique asset in the Mbalam Iron Ore Project and has now put together a quality management team to take this project forward," he said.
Sundance shares are currently valued at 9.2 cents.
Below is the full announcement:
Emerging Australian iron ore company Sundance Resources Ltd (ASX: SDL) today announced plans to accelerate the pre-feasibility study on development of its potentially world-class Mbalam Iron Ore Project in west Africa as a high-grade hematite export project after securing the appointment of high-profile mining executives, Mr George Jones, Mr Don Lewis and Mr John Saunders to its Board.
Perth-based Sundance is targeting completion of the pre-feasibility study in July 2007 on the Mbalam Project, located in the Republic of Cameroon.
A Scoping Study on the project was completed by Australian-based Promet Engineers in August 2006 based on the currently estimated initial Inferred Resource of more than 800 million tonnes of iron ore, including 218 million tonnes grading more than 60% Fe which was previously delineated by a very limited drilling program by the United Nations Development Fund. Sundance aims to confirm and expand on those results with a major exploration program over the next 6 -12 months.
Sundance is aiming to fast-track development of the project as the basis for a substantial international iron ore business positioned to meet rapidly growing global demand for iron ore.
The Company received an important boost last month with a commitment from the Government of the Republic of Cameroon to expedite the Mbalam Project. This included the proposed development of local infrastructure, a restructuring of performance obligations and conversion of a 5% interest in the project held by the local Mbalam community into a 10% interest in a Sundance subsidiary, Cam Iron SA.
High-Profile Board and Management Appointments
The Sundance Board has been restructured with the appointment of prominent Australian mining executive Mr George Jones as Non-Executive Chairman, highly-regarded civil engineer and resources project developer, Mr Don Lewis, as Managing Director/Chief Executive Officer and leading international infrastructure development expert, Dr John Saunders, as a non-executive Director.
The combined experience of Mr Jones, Mr Lewis and Dr Saunders greatly enhances the Company's ability to advance the high-grade and potentially low-cost Mbalam Iron Ore Project. Sundance's current Chairman, Mr John Corr, and existing director Mr Alec Pismiris will remain on the Board. Mr Stephen Dobson will resign as a Director. Sundance would like to recognise and thank Mr Dobson for his valuable contribution.
Mr Jones has more than 35 years' experience in the mining, banking and finance sectors including a strong involvement in the iron ore industry. He was previously Chairman of Portman Mining Limited, which he led from a start-up iron ore producer in the early 1990s to a 6mtpa producer of direct shipping hematite ore with a market capitalisation of over $600 million prior to its acquisition by US-based iron ore producer Cleveland-Cliffs Inc. Mr Jones is currently Executive Chairman of Australian iron ore company, Gindalbie Metals Ltd.
Mr Lewis brings more than 20 years' experience in resource project development, construction and financing to the Sundance management team. As Managing Director of Multiplex Engineering Pty Ltd, he was responsible for that Company's involvement in significant minerals energy and water projects, including the $350m Moma Mineral Sands project in Mozambique and the $300m Perth Seawater Desalination project in WA.
Dr Saunders' appointment further complements the expertise and experience of the Sundance Board, adding international project development skills and strong relationships within the Chinese, US, European and Australian infrastructure and financing sectors. His extensive experience in leading project and infrastructure development includes a 500,000 tpa steel mill in Vietnam and a 750MW hydro project in Nepal, each in close co-operation with Chinese construction consortia, including CMEC.
In addition, the senior management team includes Mr Ian Whitley as Project Manager and Mr David Porter as Exploration Manager. Mr Whitley has over 30 years experience in the industrial, mining and hydrocarbon sectors including key executive roles with Bank of America and Woodside Petroleum. Mr Porter has over 33 years experience in exploration and mining, including previous senior roles with Gasgoyne Gold Mines, Diversified Mineral Resources, Africwest Gold NL (now Mincor Resources) and Alcaston Mining NL.
Advancing a Potentially World-Class Project
Strategically located midway between European and Asian markets, the Mbalam Iron Ore Project in the Republic of Cameroon offers Sundance a potentially significant opportunity to develop an iron ore export project of global significance, delivering substantial volumes of high-grade hematite ore to international markets over a substantial period.
The Republic of Cameroon is rich in many natural resources, including large quantities of iron ore considered by many to be similar to the high-grade hematite ore found in the Pilbara region of Western Australia. With a history of political and social stability, and a legal system based on the French civil law system, Cameroon has long maintained its position as an important world supplier of bauxite, cocoa beans, coffee, cotton, crude oil, lumber and petroleum products.
The Cameroon Government has welcomed Sundance and the potential to develop a major new iron ore province in the Congo Craton. A recent feasibility study completed by the Cameroon Government of possible sites for a port to support the project, show such a facility could potentially be shared with other users, enabling a reduction in overall project costs.
China National Machinery and Equipment Import and Export Corporation (CMEC) is developing the US$3 billion Belinga Iron Ore Project in neighbouring Gabon, 170km from the Mbalam Iron Ore Project, highlighting the growing strategic significance of the new iron ore production region.
Commenting on his appointment to the Sundance Board, Mr Jones said he was attracted by the size and grade of the Mbalam iron ore deposits and their potential to underpin a high-quality, low-cost export business for high-grade hematite direct shipping ore.
"Sundance has been able to secure a unique asset in the Mbalam Iron Ore Project and has now put together a quality management team to take this project forward," he said.
"I am pleased to have this opportunity to make a contribution to the development of what has the potential to be a significant, world-class iron ore deposit," Mr Jones added. "A hematite deposit of this grade and potential scale has enormous strategic value in the current market, and is also well located with respect to international markets, representing a geographical alternative to the major iron production centres of Brazil and the Pilbara in Western Australia."
"Past drilling and a recent aeromagnetic survey have demonstrated that, with ongoing drilling activities and pre-feasibility study, Sundance could develop a very substantial, long-life iron ore asset in this region," Mr Jones added.
Placement
Sundance is intending to raise $20m by a placement of ordinary shares to sophisticated investors. Capital Investment Partners Pty Ltd, a company associated with two directors of Sundance, has been appointed on normal commercial terms to arrange this placement. Approximately half of this placement will be subject to shareholder approval and the balance will be made under Sundance's existing placing capacity. The incoming directors will be seeking shareholder approval to participate in the placement. Further details of the placement will be released to the market when available.
The funds will be used on the pre-feasibility study of the Mbalam Iron Ore Project in Cameroon and for general working capital.
Options
Subject to shareholder approval, it is proposed to issue options to the three incoming directors, Mr Pismiris and other consultants and executives of Sundance as part of their remuneration packages. The options will be issued in two tranches:
Tranche A: 10c exercise price 5 years expiry
Tranche B 20c exercise price 5 years expiry
If approved, the options issued to directors will be:
Tranche A Tranche B
George Jones 10m 20m
Don Lewis 10m 20m
John Saunders 5m 5m
Alec Pismiris 5m 5m
Terms, conditions and other information relating to the proposed issue of options will be covered in the Explanatory Memorandum which will be sent to shareholders in due course as part of the Notice of Meeting.
