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CAZALY RESOURCES LIMITED — Capital/Financing Update 2011
May 18, 2011
64609_rns_2011-05-18_c340bfd5-a8a4-49a4-92c5-2e462ef147c4.pdf
Capital/Financing Update
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19 May 2011
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ASX ANNOUNCEMENT
Option agreement with Cazaly Resources to complete early acquisition of Hamersley Iron Project
New York investment bank appointed to seek strategic partner/investor for . project
Winmar Resources Limited (ASX:WFE) is pleased to announce that it has executed an agreement with Cazaly Iron Pty Ltd ( Cazaly Iron ), a wholly owned subsidiary of Cazaly Resources Limited (ASX: CAZ), to vary the Farm-in Heads of Agreement dated 18 October 2010 ( Variation Agreement ).
Pursuant to the Variation Agreement, Cazaly Iron has agreed to grant Winmar an option to acquire an immediate 100% interest in the tenements the subject of the Farm-in Heads of Agreement for an exercise price of $35 million and the grant of a royalty. On exercise of the option, Winmar will have a 100% ownership interest in the Hamersley Iron Project in the Pilbara Region of Western Australia.
Winmar has also executed an engagement letter with Miller Mathis, the steel, metals and mining division of New York based investment bank Rodman & Renshaw LLC, to obtain a strategic investor or partner for the Hamersley Iron Project. Mr Robert Miller, CEO of Miller Mathis will head the engagement.
Winmar currently holds an entitlement to earn into a 51% interest of the Hamersley Iron Project and has an exclusive option to acquire the remaining 49% from Cazaly Iron Pty Ltd, a subsidiary of Cazaly Resources.
The Project is located in the East Pilbara iron ore precinct, immediately south of Fortescue Metals Group’s (ASX: FMG) Solomon project, and close to Rio Tinto’s (ASX: RIO) 28Mtpa capacity Mt Tom Price and 15Mtpa capacity Marandoo projects.
Winmar’s Hamersley Iron Project has a current JORC Inferred Resource of 143Mt @ 52.6% Fe, and an exploration target of 250Mt-300Mt @ 55-59% CaFe. Recently announced results from further drilling include; 44m @ 57.9% Fe (60.8% CaFe) and 36m @ 58.9% Fe (61.9% CaFe). The Company aims to confirm a resource upgrade during the current quarter.
In light of the early success achieved, Winmar management has negotiated the Variation Agreement with Cazaly Iron with a view to acquiring 100% of the Hamersley Iron Project as soon as practicable. The grant of the option is subject to the parties obtaining a written opinion from ASX that approval will not be required under Listing Rule 10.1.
In addition to the recent appointments of ex Rio Tinto and Fortescue Metals executive Mr Philip Kirchlechner as Marketing Consultant and Engenium to conduct a conceptual scoping study, the engagement of Rodman & Renshaw (Miller Mathis) should position the Company well to attract the appropriate strategic partner/investor into Winmar.
Level 2, 38 Richardson Street, West Perth, WA, 6005 P. +61 8 9322 6283 F. +61 8 9322 6398 [email protected] www.winmarresources.com.au
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The Board and management at Winmar are delighted to have the services and expertise of Rodman & Renshaw to assist the Company in achieving its objectives to be a significant player in the iron ore sector.
Rodman & Renshaw is a leading financial advisor and placement agent for small and midcap resource companies in the US, Canada and other select regions around the world. It has raised more than $5.5 billion and completed 40 transactions over the past 18 months.
ENDS
For further information, please contact:
Mr Benjamin Cooper James Moses Executive Director Media and Investor Relations Winmar Resources Limited Mandate Corporate Ph: +61 425 311 121 Ph: +61 420 991 574 E: [email protected] E: [email protected]
Notes:
The information that relates to exploration targets, exploration results and drilling data of Cazaly operated projects is based on information compiled by Mr Gregory Miles who is a Member of The Australian Institute of Geoscientists and is an employee of Cazaly Resources Limited. The information in this report that relates to the Winmar Deposit Resource Estimate is based on information compiled by Ms Felicity Repacholi-Muir who is a Member of the Australian Institute of Geoscientists and is also a member of Cazaly Resources Limited. Both Ms Repacholi-Muir and Mr Miles have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he they are undertaking to qualify as a Competent Persons as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Both Ms RepacholiMuir and Mr Miles consent to the inclusion of their names in the matters based on their information in the form and context in which it appears.
The Exploration Target refers to the conceptual extended resource of the Winmar Deposit based on drilling to date and the geometric extent of a gravity anomaly with coincident CID mineralisation. At the present time there is insufficient drilling to determine the extended mineral resource estimate and it is uncertain if further exploration will result in the determination of such a resource.