re: Ann: SRE: Stirling's Strategy Going F...
The Federal Government's proposed new resources tax has led to two Australian gold projects being shelved From: AAP June 17, 2010 12:31PM
SWAN Gold Mining has shelved two gold projects slated to start in August because the planned new resources tax prevented it from raising equity. A spokesman said Swan Gold's Carnegie and Mt Ida projects in Western Australia would have employed 150 people.
The shelving of the projects is part of a restructure of Swan Gold's parent company Stirling Resources Ltd, managed by Perth mining identity Michael Kiernan.
Under the restructure, Stirling also plans to merge with its 58 per cent-owned zircon miner Matilda Zircon Ltd and copper miner Redbank Copper Ltd, which is 26 per cent held by Stirling.
Stirling said the terms and conditions of the proposed mergers were currently being negotiated.
``Our target is to reduce the group's overall corporate, administrative and overhead costs by bringing the copper and zircon projects together as business units of Stirling,'' Mr Kiernan said in a statement on Thursday.
``This rationalisation will save some $1.5 million per year in corporate public company costs.''
Stirling's focus for its 35 per cent-held Swan Gold was to secure funding and re-list on the Australian stock exchange in one to two months, Mr Kiernan said.
Swan Gold was to be relisted in early May, but this was delayed due to accounting requirements.
The company was formed following the recapitalisation of Monarch Gold Mining Company Ltd, which went into administration in July 2008 after closing its loss-making Davyhurst mine in WA's Goldfields region.
``Swan Gold was in the process of securing a $10 million funding package when the RSPT (resources super profits tax) issue unfolded,'' Stirling said.
``It will now be a requirement of relisting for Swan Gold to demonstrate it has sufficient working capital to meet its commitments.''
In the meantime, Stirling intends to appease those who acquired Swan Gold stock as part of the Monarch recapitalisation process by issuing on a one-for-10 basis one Stirling share for every 10 Swan Gold shares held.
The boards of Stirling, Matilda, Redbank and Swan Gold will be reduced under the restructure.
Shares in Stirling were down 0.7 cents, or 7.22 per cent, at nine cents at 1232 AEST.
RCP Price at posting:
2.5¢ Sentiment: None Disclosure: Not Held
