AZR aztec resources limited

Next Iron Ore producer

  1. 236 Posts.
    Probably the next PMM or MGX??????
    High grades needs no railway line and closer than other ports for overseas markets.


    HOMEX - Perth

    The directors of Aztec Resources Limited ("Aztec Resources" or
    "Company") are pleased to announce the Company has entered into
    negotiations to acquire the remaining 30% interest of the Koolan
    Island Project. The company currently holds a 70% interest in the
    Koolan Island Project and completion of this acquisition will
    increase its stake to a 100% interest.

    The Company and the vendors of the Koolan Island Project are in the
    process of finalising negotiations to enter into an option agreement
    to give Aztec Resources the right to acquire the remaining interest
    in the Koolan Island Project. The term of the option will be 12
    months and the option fee will be $100,000. On exercise of the
    option, Aztec Resources will be obligated to pay the vendors a
    royalty of $2.50 per tonne of iron-ore produced.


    The Koolan Island Project is some 1900 km north of Perth, Western
    Australia, and about 70km to the north of the port of Derby in the
    Kimberley region of Western Australia.

    Aztec Resources holds three exploration licence applications,
    covering an area of approximately 200 square kilometres, over Koolan
    Island and the adjacent mainland. The Koolan and Cockatoo Island
    iron-ores are some of the richest and purest in the world,
    containing between 67% and 69% Fe, with low contaminants in the form
    of silica, phosphorous, aluminium and sulphur. BHP mined 67 million
    tonnes of high-grade haematite ore averaging 67% iron between 1965
    and 1994 when mining ceased.

    Portman Mining and Henry Walker Eltin are mining extensions to the
    ore on nearby Cockatoo Island, 5 kilometres to the west. Cockatoo
    Island was also mined by BHP and closed in 1986.

    A team of independent consultant mining engineers and geologists,
    experienced in the iron ore industry, visited Koolan Island in April
    to assess the ore reserve potential, and determine the status of the
    Main Pit and satellite ore bodies following the closure of BHP's
    mining operations in 1994.

    The Company has been able to obtain a number of important technical
    data from BHP which includes geotechnical studies on the hanging wall
    and footwall slopes of the Main Pit and hydrographic information of
    the shipping and berthing channels. In addition, final pit survey and
    original topographic information has been obtained in a digital
    format. External mining consultants have been briefed by Aztec mining
    engineers who are currently preparing a scope of works and budget.
    The data will be utilised by them to determine a conceptual mining
    plan for a number of cutback scenarios in order to maximise the
    economic potential of the proposed mine. This work will form part of
    a pre-feasibility and feasibility study that will include costing for
    infrastructure development, pit de-watering and contract mining

    Further work is being undertaken that will include a new aerial
    survey of the island and exploration drilling of the Main Pit western
    extension and Mullet and Acaia orebodies.

    Evaluation of the historical data and detailed reports prepared by
    former BHP technical personnel, with experience on Koolan Island,
    indicates that the ore reserve potential is far greater that
    originally envisaged.


    The Company intends to raise approximately $1.8 million (before
    costs) through the issue of 40 million shares at an issue price of
    4.5 cents per share. The issue will include a free attaching option
    for every 2 shares subscribed. The Company will also issue 120
    million options at 0.2 cents per option to raise $240,000. 80 million
    of these options will be offered to subscribers to the 40 million
    shares on the basis of two options for every one share subscribed for
    and issued. The balance of 40 million options will be issued at the
    discretion of the directors. These options will have an exercise
    price of 20 cents each and an expiry date of 31 January 2005.

    Funds raised from the issue will be used to fund work on the Koolan
    Island Project, in particular completion of a
    pre-feasibility/feasibility study, to progress metallurgical test
    work on the Company's Brockman Project, general exploration and
    evaluation work, and for general working capital purposes. It is
    anticipated that the Kooloon Island pre-feasibility study will be
    completed within the next three months.

    It is proposed that these capital raisings be placed through a Broker
    to the Offer, and made through the issue of a prospectus.


    With the broadening of the Company's focus, in particular on the
    Koolan Island Project and the Brockman Tantalum/Polymetallic Project,
    it is proposed that the Board of the Company be re-constituted to
    bring to the Company the necessary spread of experience to progress
    its projects.

    Mr Adam Rankine-Wilson has been invited to join the Board, such
    appointment to be subject to shareholder approval. Subject to such
    shareholder approval, Mr Rankine-Wilson will be invited to take the
    role as Non-Executive Chairman. Mr Michael Povey has joined the Board
    as a non-executive director. Mr Ron Gajewski has resigned as a
    director of the company, however, will be retained by the Company in
    a consulting role. Mr Neville Bassett has been appointed as company

    Subject to all necessary approvals the Board will comprise:

    Adam Rankine-Wilson (Chairman)
    Brett Matich (Managing Director)
    Edmond Edwards (Executive Director)
    Michael Povey (Non-Executive Director)

    Mr Rankine-Wilson, aged 39, was appointed Managing Director of Grange
    Resources Limited in 1990. In 1992 Grange took over Barrack Mines
    Limited (now a wholly owned subsidiary of Grange). Over the past 12
    years Mr Rankine-Wilson has been involved predominantly in the mining
    industry and has a strong background in the finance and investment
    sectors. During this period he has been a director/managing director
    of various private and public companies, including Managing Director
    of Quaestus (now Australian Silicon controlled by Portman Mining
    Limited - approximately 72% shareholding). Mr Rankine-Wilson has a
    minority interest in Koolan Island project.

    Mr Povey is a Mining Engineer with 20 years extensive world-wide
    experience in mining and mining related industries. His mining
    experience has included management positions at some of the world's
    largest open pit and underground operations and has included mine
    operations and management, resource evaluation and mine development,
    consulting and business management. The majority of his Australian
    experience was gained in Western Australia including a close
    involvement with the BHP Koolan Island iron ore operation through to
    its closure in 1994.

    Mr Povey is a Chartered Engineer, an Associate of the Camborne School
    of Mines, Member of the Australian Institute of Mining and
    Metallurgy, Affiliate Member of the Australian Institute of Company
    Directors and holds a West Australian Unrestricted Quarry Managers
    Certificate of Competency.


    The Company also proposes to issue a total of 20 million free options
    to the directors, officers and consultants of the Company. The
    options will be unlisted and have an exercise price of 5 cents each
    and an expiry date of 30 June 2007.

    The Company will seek shareholder approvals in respect to the
    proposed issue of options and the capital raisings.


    On 16 May 2002, 100 million shares were released from escrow. Of
    these shares the subject of the release, 15 million shares will
    remain escrowed pursuant to voluntary escrow agreements until 16
    August 2002 and 75 million shares will remain escrowed pursuant to
    voluntary escrow agreements until 16 May 2003.

    B Matich
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Currently unlisted public company.

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