Aussie Union Resources target Iranian zinc depositSYDNEY (The...

Aussie Union Resources target Iranian zinc deposit


SYDNEY (The Age) -- Mining sector investment company Union Resources Ltd has said it expected to achieve a controlling share of a zinc deposit in Iran that could generate more than $15 billion in sales over 30 years.

The company plans to invest more in the up-front establishment costs of the Mehdiabad zinc project on central Iran to increase its share of the asset.

Union Resources currently has a 33 percent stake in a joint venture to develop the resource with Iran Mines and Mineral Industry Development Organisation (50 percent) and private Iranian company Itok Gmbh (nearly 18 per cent).

Managing director Rob Murdoch said Mehdiabad is the world's largest untapped zinc deposit and was expected to generate $15 billion in sales over 30 years, mainly of zinc at an estimated production cost of $600 per ton, as well as lead and silver concentrates.

"As the operating cost is only half current revenues the project is expected to provide a very substantial cash flow to the company for a long time," Mr Murdoch said.

Union Resources and Itok are spending a total of $10 million to earn a 50 percent combined interest in the project and the shareholding of local operating company Mehdiabad Zinc Co.

"Union Resources is providing the bulk of the funds and will have the bulk of the equity as a result," Mr Murdoch said.

The company expects its equity in the project to exceed 40 percent by the end of a feasibility study now underway.

Union Resources total project expenditure to the end of March 2005 was $6.25 million.

Union Resources also holds 49 percent of gold company Gold Aura, which floated on the Australian Stock Exchange in 2002, a 22 percent indirect interest in Philippines Telco Eastern Telecommunications and Newcastle Stock Exchange listed technology company Jab.

It traded on Friday at 2.8 cents a share.

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http://www.tehrantimes.com/Description.asp?Da=5/2/2005&Cat=9&Num=10