For personal use only

Transcription

1 Suthern Crss Gldfields Ltd is an Australian explratin cmpany ffering investrs a cmpelling cmbinatin f near term cash flw and utstanding explratin ptential. The Cmpany has a dminant 4,000km 2 tenement and mineral rights hlding in the prlific Marda & Suthern Crss regins f Western Australia. The Cmpany s prpsed Marda Gld Prject presents the pprtunity t establish the regin s nly gld prductin facility with significant explratin upside. Bard f Directrs Samantha Tugh Nn-Executive Chairman Glenn Jardine Managing Directr Graham Brck Nn-Executive Directr Jhn Rwe Nn-Executive Directr Capital Structure Shares n Issue M Optins n Issue 46.5 M Majr Sharehlders Mineral Resurces Limited: 14.0 % Western Areas Limited: 5.6 % Cntact admin@scrss.cm.au PO Bx 708, West Perth 6872 Unit 16, 162 Clin St, West Perth SXG TO DOUBLE GOLD RESOURCES AND HALVE MARDA GOLD PROJECT CAPITAL COST WITH ACQUISITION OF SANDSTONE GOLD PROJECT FROM TROY RESOURCES Cmpany-making acquisitin includes a 600ktpa gld plant, 100 man camp, 700kz resurce base and extensive high quality tenement package putting SXG n track fr prductin next year Highlights: SXG t acquire the Sandstne Gld Prject assets frm Try Resurces (ASX: TRY) fr $5M, millin ptins in SXG and a 2% ryalty n prductin frm the Sandstne tenements, with the deal encmpassing: a 600,000tpa CIL gld plant, currently n care and maintenance; a 100-persn camp and explratin cmpund; a resurce inventry ttalling 1.5g/t Au fr 720,000z gld; an 1,100km 2 explratin tenement package including numerus advanced resurce targets and walk-up explratin targets. The relcatin f the Sandstne plant t Marda wuld significantly enhance the prjected ecnmics f the Marda Gld Prject as fllws: estimated reductin in capital cst frm $51M t $25M; increase in NPV 8% frm $42M t $68M; increase in IRR frm 36% t 80%; imprved prject payback frm apprximately 2 years t 1 year. Prvides SXG with a clear pathway t gld prductin, significantly reducing plant cnstructin and scheduling risk fr its flagship Marda Gld Prject, 150km nrth f Suthern Crss. Mre than dubles SXG s gld resurce inventry frm 535,000z currently t 1.3Mz, giving it critical mass and greater prfile as an emerging Australian gld prducer. Suthern Crss Gldfields Limited (ASX: SXG SXG r the Cmpany ) is pleased t annunce the acquisitin f the Sandstne Gld Prject, including a 600,000tpa Carbn-in-Leach (CIL) gld prcessing plant, frm Try Resurces Limited (ASX: TRY Try Resurces ). SXG s intentin is t relcate the Sandstne plant t its well advanced Marda Gld Prject, lcated apprximately 150km nrth f the histric mining centre f Suthern Crss in Western Australia, t facilitate the early cmmencement f gld prductin (see Figure 1).

2 In additin t the Sandstne plant and 100 persn camp, the Sandstne Gld Prject acquisitin als includes a 1,100km 2 tenement prtfli hsting a JORC cmpliant resurce base f 1.5g/t Au fr 720,000 unces f gld (see Table 1). Cmbined with the Cmpany s existing 535,000z JORC cmpliant resurce inventry at Marda (see Table 2), the acquisitin will mre than duble SXG s resurce inventry t apprximately 1.3 millin unces, giving it significantly greater critical mass and visibility as an emerging Australian gld prducer. The Sandstne tenements als ffer an exciting lnger term explratin pprtunity fr SXG, t be pursued in cnjunctin with its 4,000km 2 tenement prtfli at Marda. SXG believes that a well-funded explratin campaign acrss bth f these areas has the ptential t deliver a new generatin f multi-millin unce discveries. This explratin effrt wuld be funded ut f future cash flw frm the Marda peratin. Based n relcating the Sandstne plant t Marda and using the same assumptins as the Feasibility Study fr the Marda Gld Prject develpment cmpleted in May 2012 (see ASX Annuncement 10 May 2012), the Sandstne acquisitin is prjected t result in imprved Marda Gld Prject ecnmics fr Suthern Crss f: 50% reductin in plant and infrastructure capital cst frm $51 millin (+/- 15%) t $25 millin (+/- $5 millin); 50% increase in Net Present Value (NPV 8% ) frm ~$42 millin t ~$68 millin; Dubling f Internal Rate f Return (IRR) frm ~36% t ~80%; Prject capital cst payback f apprximately 1 year; and Reduced plant cnstructin and scheduling risk. The cnsideratin fr the acquisitin cmprises: $5 millin cash (apprximately $2.5 millin will g twards the replacement f existing envirnmental bnds); a 2% net smelter ryalty n all nn-nickel prductin frm the Sandstne Tenements; and millin unlisted ptins in SXG having an exercise price f $0.10 and term f 5 years. These ptins represent 15% f SXG s current issued capital. The ptins will be issued under SXG s 15% placement capacity and will nt be subject t sharehlder apprval. Cmpletin f the acquisitin f the Sandstne Gld Prject by SXG is cnditinal n: SXG and Try Resurces agreeing frmal dcumentatin, custmary fr a transactin f this nature; any necessary regulatry r third party cnsents r agreements being btained; SXG, within three mnths, securing financing (including financiers due diligence) t cmplete the acquisitin; the Sandstne Gld Prject assets remaining in gd standing until cmpletin; and SXG sharehlder apprval being btained, if required fr any reasn. SXG s Managing Directr, Mr Glenn Jardine, said he was delighted t have reached agreement with Try Resurces t acquire the Sandstne assets, generating significant pprtunities fr bth cmpanies. The SXG Bard believes that this is a cmpany-making transactin which will substantially bst ur resurce inventry while at the same time giving us a clear pathway t prductin at Marda next year thrugh the acquisitin and relcatin f the existing gld treatment plant at Sandstne, Mr Jardine said. In additin, Sandstne ffers a substantial resurce inventry and a number f highly prspective explratin targets that we intend t pursue ver the lnger term, nce we have prductin and cash flw established at Marda. Page 2 f 7

3 Mr Jardine said the significant enhancement f the prject ecnmics generated by the purchase and relcatin f the Sandstne plant was expected t assist with securing debt funding fr the pre-prductin capital cst f the mine develpment. We are currently in discussins with a number f parties relating t btaining debt finance fr the Marda develpment (see ASX annuncement 2 August, 2012) and the Bard is cnfident that we are well n track t secure an apprpriate finance arrangement later this year. Try Resurces Managing Directr, Mr Paul Bensn, said: With ur fcus as a Cmpany n the cntinued develpment f ur Suth American prjects, this prvides an pprtunity t crystallise value frm the Sandstne assets while at the same time giving us a strategic 15% stake in an emerging Australian gld prducer. Backgrund infrmatin n the Sandstne Gld Prject The Sandstne Gld Prject, lcated 600km nrth-east f Perth, cmprises a substantial package f mineral tenements cvering an area f 1,100km 2 and an entire greenstne belt within the Achaean Yilgarn Blck f Western Australia. The assets include the Sandstne Mill, a fully permitted 600,000 tnne per annum gld treatment plant, as well as a fully equipped 100- persn camp and explratin cmpund lcated in the village f Sandstne. Since the initial discveries f gld at the end f the 19th century, the belt has prduced ver 1 millin unces f gld frm undergrund and pen pit peratins. Try Resurces ceased mining at the Sandstne Gld Prject in August 2010 and the peratin was placed n care and maintenance n 16 September Current gld resurces at the Sandstne Gld Prject as reprted by Try Resurces in its 2011 Annual Reprt are apprximately 14.5Mt at 1.5g/t fr 720,000 unces f gld. Explratin in the Prject area is fcused n a series f targets including advanced resurce targets, drilled targets at the near resurce stage and the investigatin f ptential fr deep, bulk tnnage high grade gld re bdies. Gld drilling targets include: Tw Mile Hill gld mineralised tnalitic stckwrk pen at depth. Quartz vein-hsted gld mineralisatin has been intersected cntinuusly frm surface t a vertical depth f ver 400m in diamnd drill hles. High grade gld mineralisatin has als been intersected in banded irn frmatin (BIF) adjacent t the tnalite stck. Ttal resurces at Tw Mile Hill cmprise: A tnalite hsted JORC Inferred resurce f 1.3g/t cntaining 452,100z Au (0.5g/t Au cutff); A BIF hsted JORC Indicated resurce f 9.9g/t cntaining 18,800z Au (0.5g/t Au cut-ff). Ptential exists t expand the resurce at depth and t discver additinal high grade mineralisatin within the adjacent BIF. Bull Oak quartz reefs hsted within a granitid stck previusly mined by undergrund and pen pit methds are untested at depth; Ptential exists fr large vlume, lw grade gld mineralisatin similar t that fund at ther lcatins thrughut the Sandstne Greenstne belt; and Indmitable Shear Zne hst t a number f underexplred prspects. The extensive nature f this highly altered shear suggests prximity t a majr gld depsit within the primary zne. In additin t gld, the Sandstne tenements are als prspective fr irn re and uranium, which have been the fcus f limited histrical explratin. ENDS Page 3 f 7

4 FIGURE 1 MARDA AND SANDSTONE PROJECTS COMBINED TENEMENT PACKAGE Page 4 f 7

5 Fr further details, please cntact Glenn Jardine, Managing Directr Suthern Crss Gldfields Ltd Telephne: , glennj@scrss.cm.au, Refer website Fr media inquiries, please cntact: Nichlas Read Read Crprate Telephne: , nichlas@readcrprate.cm.au Page 5 f 7

6 Table 1 Cmbined SXG and Sandstne Gld Prject JORC Mineral Resurce Estimate Measured Indicated Inferred Ttal Tnnes Grade Ounces Tnnes Grade Ounces Tnnes Grade Ounces Tnnes Grade Ounces SXG 2,795, ,446 2,613, ,051 2,785, ,224 8,194, ,606 Sandstne (i) 1,932, ,200 12,586, ,400 14,518, ,600 Ttal 2,795, ,446 4,545, ,251 15,371, ,624 22,712, ,254,206 (i) Sandstne resurces are taken frm the Try Resurces Limited, 2011 Annual Reprt Table 2 SXG JORC Mineral Resurce Estimate Depsit Measured Indicated Inferred Ttal Tnnes Grade Ounces Tnnes Grade Ounces Tnnes Grade Ounces Tnnes Grade Ounces NORTHERN DEPOSITS Marda Central 1,918, , , , , ,953 2,406, ,209 King Brwn 100, ,060 63, ,274 73, , , ,300 Glden Orb 415, , , , , , , ,700 Mt King 523, , , ,450 Sub Ttal 2,434, , , ,162 1,099, ,522 3,861, ,659 Barranc Optin 1,302, , , ,300 2,251, ,300 Sub Ttal 2,434, ,191 1,630, ,062 2,048, ,822 6,113, ,959 SOUTHERN DEPOSITS Battler 361, ,255 39, ,372 52, , , ,539 British Hill 944, , , ,490 1,628, ,108 Sub Ttal 361, , , , , ,402 2,081, ,647 Ttal 2,795, ,446 2,613, ,051 2,785, ,224 8,194, ,606 Ntes t Accmpany Mineral Resurce Estimate table: Numbers may nt add due t runding. The resurce mdel fr King Brwn, Glden Orb, Battler, Marda Central (Pythn, Dlly Pt, Dugite, Gldstream, Cbra, Taipan and Greentree), were cnstructed using Minesight sftware. The resurce estimates fr these depsits utilized a blck mdel with blck dimensins typically f 5m by 2m by 2.5m blcks (X, Y, Z). The Barranc Depsits cntaining sub-areas designated as Die Hardy and Red Legs were als cnstructed using Minesight sftware. The resurce estimates fr these depsits utilized a blck mdel with blck dimensins typically f 1m by 5m by 2.5m blcks (X, Y, Z). Blck interplatin f the Nrthern and Suthern depsits was estimated using Ordinary Kriging within mineralizatin wire-frames based upn a ~0.50g Au/t lwer delineatin cut-ff. The Marda Central prject area is cmprised f the Pythn, Dlly Pt, Dugite, Gldstream Cbra, Taipan, and Greentree depsits. Resurce classificatin has been cnsidered with respect t varius reprting mdifying factrs as utlined in the JORC Cde (Dec 2004). Cnsideratin has been given t data quality, drilling and sample density, distances f interplated blcks frm assays pints and the assciated statistical lcal spatial distributin f gld and estimatin variances. Resurce assaying data sets derived frm all available reverse circulatin and diamnd drill sampling. Gelgy rck mass mdels and interpreted fault r shear znes have been used t cnstrain mineralisatin as apprpriate. Weathering dmains have been used t cnstrain mineralisatin and help assign representative bulk density estimates. Bulk densities are based n testwrk carried ut by SXG and previus cmpanies and has been adjusted where necessary accrding t underlying weathering and / r xidatin state. Data density varies and is reflected in the resurce categry which have been applied. All measured resurces have a drill-hle density f apprximately 12.5m x 12.5m. All indicated resurces except Battler have a drill-hle density f apprximately 25m x 25m. Battler has a drill density f 20m x 12.5m. Inferred resurces have variable density but always less than 50m x 50m except fr Mt King which has variable drill-hle spacing between 25m and 100m and the Barranc Optin resurces which have an apprximate drill hle spacing f 100m x 20m and were assigned an Inferred Resurce status. Assays are generally fire assay, with limited aqua regia assays in the weathered zne. All drill-hle cllars are surveyed by GPS. Dwn hle survey data is limited fr histric drilling, except at British Hill, where mst drill-hles are surveyed. All SXG s drilling has adequate dwn hle survey infrmatin. Page 6 f 7

7 JORC Cde Cmpliance Statement The gelgical infrmatin in the reprt t which this statement is attached that relates t Explratin Results, Mineral Resurces r Ore Reserves is based n infrmatin cmpiled by Richard Simmns wh is a Member f The Australasian Institute f Mining and Metallurgy. Richard Simmns is a full time emplyee f Suthern Crss Gldfields Limited. Richard Simmns has sufficient experience that is relevant t the style f mineralisatin and type f depsit under cnsideratin and t the activity that he is undertaking t qualify as a Cmpetent Persn as defined in the 2004 Editin f the Australasian Cde fr Reprting f Explratin Results, Mineral Resurces and Ore Reserves. Richard Simmns cnsents t the inclusin in the reprt f the matters based n his infrmatin in the frm and cntext in which it appears. The resurce estimatin f the King Brwn depsit is based n wrk cmpleted by independent cnsultant Mr Dn Maclean f Ravensgate Minerals Industry Cnsultants based n resurce drilling data sets prvided by SXG. Mr Maclean is a Member f The Australasian Institute f Mining and Metallurgy and qualifies as a Cmpetent Persn in respect f the 2004 JORC cde and has sufficient experience relevant t the style f mineralisatin and depsit type being estimated. Mr Maclean has cnsented t the inclusin f this infrmatin in the frm and cntext in which it appears in this reprt. Resurce estimatins fr the Battler depsit in the Suthern depsit area is based n wrk cmpleted by independent cnsultant Mr Stephen Hyland f Ravensgate Minerals Industry Cnsultants which is based n resurce drilling data sets prvided by SXG. Mr Hyland is a Fellw f The Australasian Institute f Mining and Metallurgy and qualifies as a Cmpetent Persn in respect f the 2004 JORC cde and has sufficient experience relevant t the style f mineralisatin and depsit type being estimated. Mr Hyland has cnsented t the inclusin f this infrmatin in the frm and cntext in which it appears in this reprt. The updated resurce estimatins fr the Nrthern depsits, including the Pythn, Dlly Pt, Dugite, Gldstream, Cbra, Taipan, Green Tree, Glden Orb, Die Hardy and Red Legs depsits were als carried ut by Mr Stephen Hyland again utilizing resurce drilling data sets prvided by SXG. Mr Hyland is a Principal Cnsultant with Ravensgate Minerals Industry and is als a Fellw f The Australasian Institute f Mining and Metallurgy. Mr Hyland has sufficient experience which is relevant t the style f mineralisatin and type f depsits under cnsideratin and t the activity undertaken t qualify as a Cmpetent Persn as defined in the 2004 Editin f the 'Australasian Cde fr Reprting f Explratin Results, Mineral Resurces and Ore Reserves'. Mr Hyland als cnsents t the inclusin in the reprt f the resurce estimatin matters fr these depsits based n the reprting infrmatin in the frm and cntext in which it appears. Disclaimer This dcument has been prepared by Suthern Crss Gldfields Limited (SXG). The infrmatin and pinins cntained in this dcument are derived frm public and private surces which we believe t be reliable and accurate but which, withut further investigatin, cannt be warranted as t their accuracy, cmpleteness r crrectness. This infrmatin is supplied n the cnditin that SXG, and any directr, agent r emplyee f SXG, are nt liable fr any errr r inaccuracy cntained herein, whether negligently caused r therwise, r fr lss r damage suffered by any persn due t such errr, missin r inaccuracy as a result f such supply. Frward-Lking Statements This dcument cntains frward lking statements cncerning the prjects wned by SXG. Statements cncerning mining reserves and resurces may als be deemed t be frward lking statements in that they invlve estimates based n specific assumptins. Frwardlking statements are nt statements f histrical fact and actual events and results may differ materially frm thse described in the frward lking statements as a result f a variety f risks, uncertainties and ther factrs. Frward lking statements are based n SXG s beliefs, pinins and estimates as f the dates the frward lking statements are made, and n bligatin is assumed t update frward lking statements if these beliefs, pinins and estimates shuld change r t reflect ther future develpments. Explratin ptential is cnceptual in nature and where there has been insufficient explratin t define a Mineral Resurce it is uncertain if further explratin will result in the determinatin f a Mineral Resurce. Readers are cautined nt t place undue reliance n frward-lking statements and SXG assumes n bligatin t update such infrmatin. Page 7 f 7