VRX signs Muchea silica deal

Shares in VRX Silica have surged to 16 cents today, a rise of 33 per cent, after it entered into a strategic alliance with China Southern Glass related to its Muchea silica sand project.

West Perth-basedVRX said the objectives of the strategic alliance include exploring the potential for marketing, promotion and sale in China of silica sand products from Muchea, and potential sources of capital finance for the construction of production facilities at the project.

The agreement has been signed for an initial term of six months with a provision for an automatic renewal for an additional six-month period.

VRX managing director Bruce Maluish said the strategic alliance further highlights the potential for a significant silica sand mining operation at Muchea, and supports its assessment of increasing silica sand supply constraints in the Asia Pacific region.

“We are excited by the prospect of working with China Southern Glass and exploring opportunities in the Chinese silica sand market,” said Mr Maluish.

Last month, VRX upgraded the resource at the project to 208 million tonnes at a grade of 99.6 per cent silica.

In April, the silica sand explorer announced the receipt of enquiries and expressions of interest from 20 manufacturers across the Asia Pacific.

Silica sands is used in industrial processing to make items such as glass, construction materials, personal care products, electronics, and even renewable materials.