some money on the way at least, oppies to be converted and Winmar to list in a couple of weeks, should be total of $5.3m for CAZ
Winmar looking for a stand-out performance
Ron Berryman Thursday, 17 February 2011
CAZALY Resources chief Nathan McMahon?s admiration and respect for former champion AFL footballer Nicky Winmar is about to be reflected in an iron ore spin-off to be listed in the next few weeks.
Winmar Resources has closed its offer of 35 million shares at an issue price of 20c over-subscribed and the company intends to waste little time to prove up the resource at its Hamersley iron ore project in the Pilbara region of Western Australia.
The Hamersley project is owned by Cazaly Iron, a wholly owned subsidiary of ASX-listed Cazaly Resources. Cazaly will retain a 49% interest in the project in the short term with Winmar holding the exclusive right to earn-in to an initial 51% interest.
Under the agreement Winmar has paid a non-refundable option fee of $400,000. After the distribution of 2.5 million Winmar shares and $3.1 million, it will have a 51% shareholding in the project.
McMahon, who will be a non-executive director of the new company, told MiningNews.net that Cazaly would be looking after the drilling and current plans were to have the drill rigs moving before the end of February, providing rig availability.
?I believe we?ll start drilling before we actually list,? he said.
?All the approvals are in place and the RC [reverse circulation] drilling program is planned to provide initial data for metallurgical testwork as well as increase the resource.?
Chairman Albert Wong said the share issue had been attractively priced for both shareholders and investors.
?It?s got the two Gs,? he said. ?Geologically, it?s a very interesting prospect being right next to Fortescue Metals Group?s Solomon project, 25 kilometres from Flinders Mines? iron ore project and 50 kilometres northeast of the Tom Price township. It?s the same sort of resource as Solomon.
?The second G is that geographically, because we?re so close to other major projects, it won?t require millions of dollars for infrastructure.?
While insufficient exploration has been conducted to define the target as a mineral resource, previous work carried out by Cazaly Iron located a buried channel iron deposit from which a maiden inferred resource of 143 million tonnes at 52.6% iron ore was reported to the Australian Securities Exchange in June last year.
?We?re going to have to do more drilling to increase the size of the resource, which we?re confident we?ll do,? Wong added. ?But at the moment we?ve got about 140 million tonnes of JORC inferred resource.?
Wong said Winmar had the right to purchase a 100% equity interest in the project by paying Cazaly Iron 50c a tonne of its participating interest of a JORC-compliant mineral resource within 18 months or $1/t between 18 and 36 months.
An interesting inclusion on Winmar?s board is former New South Wales premier Neville Wran. Apart from leading the state as premier for 10 years from 1976, he was also minister for mineral resources and chairman of CSIRO from 1986 to 1991.
CAZ Price at posting:
38.5¢ Sentiment: LT Buy Disclosure: Held
