From Resources Rising Stars [IMG]Strandline Resources (ASX: STA)...

From Resources Rising Stars

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Strandline Resources (ASX: STA)
Market Capitalisation: $38.5M at 14c (320.7M shares on issue)

Strandline Resources (ASX: STA) is an emerging mineral sands developer with a pipeline of assets in Australia and Tanzania.

The Company’s main efforts are currently focused on its Coburn project in WA, the smaller Fungoni project in Tanzania and the large Tajiri project, also in Tanzania.

At Coburn, the recently-completed Definitive Feasibility Study showed the project will generate strong financial returns with a pre-tax NPV of A$551m and an internal rate of return of 32 per cent.

Strandline’s work on the Coburn inventory has also paid handsome dividends, with reserves increasing by 70 per cent to 523Mt @ 1.11% Total Heavy Mineral (THM). This underpins an initial mine life of 22.5 years at the planned mining rate of 23.4Mtpa. Coburn already has key project approvals, making it construction-ready pending finalisation of project financing.

At Fungoni, project funding is well advanced and again, key mining and environment licences are in place. All Fungoni’s product has been pre-sold via offtake agreements.

The strong outlook for Coburn and Fungoni recently prompted brokers Hartleys and Patersons to put buy recommendations on Strandline shares.

Hartley tips Strandline shares to hit 22c compared with their 14c price at the time of writing, saying the company has “the potential to build a substantial mineral sands business”.

Patersons has a 28c price target on the stock and cites the company’s strong assets and experienced management as reasons for its optimism.