todays announcement text

9 February 2004
FARM-IN AGREEMENT TO ADVANCE WIM 150 DEPOSIT
MURRAY BASIN, VICTORIA
Austpac Resources N.L. (ASX:APG) and Southern Titanium N.L. (ASX:STN) are pleased
to announce they have signed a farm-in agreement to investigate the development of
Austpac’s WIM 150 heavy mineral deposit near Horsham in Victoria. Southern Titanium
will earn an 80% participating interest by completing a bankable feasibility study on WIM
150, after which Austpac may elect to maintain a 20% working interest or convert to a 10%
net profit interest.
The strategic importance of this agreement arises from the following:
Ø This alliance will draw on the significant expertise of both parties:
· From its work at Mindarie in South Australia, Southern Titanium has experience
in the testing and design of processes for the recovery of relatively fine grained
heavy mineral sands. Southern Titanium believes advances in gravity separation
processes and subsequent mineral separation of heavy minerals at fine sizes
will lead to the design of a viable project around the WIM 150 resource
· Austpac has already tested the processing of WIM 150 ilmenite, using its own
proprietary processes. The deposit contains approximately 12.5 million tonnes of
ilmenite. The results on ilmenites from WIM 150 and from other Murray Basin
deposits have been encouraging and, through Austpac, Southern Titanium plans
to undertake larger scale pilot plant work.
Ø Southern Titanium believes that the WIM deposits in Victoria represent the most
concentrated and rich sources of zircon worldwide. Given the rapidly declining ratio
of zircon to ilmenite in the known but as yet undeveloped deposits there is little
doubt that these deposits should become increasingly valuable:
· Importantly, the WIM 150 Project will be able to draw on the experience gained
from the production and marketing of Southern Titanium’s zircon rich Mindarie
Project
· The WIM 150 deposit contains approximately five million tonnes of zircon and
preliminary analysis suggests that production of 140,000 tonnes of zircon per
annum could be possible, which would make Southern Titanium a major supplier
of zircon in the world.
Ø Southern Titanium also considers that the WIM 150 deposit has a number of
attributes which will facilitate a low capital expenditure:
AUSTPAC RESOURCES N.L.
ACN 002 264 057
Level 12, Currency House
23 Hunter Street
SYDNEY NSW 2000
GPO Box 5297
SYDNEY NSW 2001
Telephone: (+61 2) 9221 3211
Facsimile: (+61 2) 9223 1975
Email: [email protected]
www.austpacresources.com
NOTE: This report is based on and accurately reflects information compiled by M.J. Turbott who is a member of the Australasian
Institute of Mining and Metallurgy and a member of the Australian Institute of Geoscientists and is a competent person as defined in
the Australian Code for Reporting of Identified Mineral Resources and Ore Reserves.
Austpac Resources N.L. is an Australian listed minerals technology company and emerging synthetic rutile producer. Austpac’s processes include
technology to transform ilmenite into high grade synthetic rutile, a preferred feedstock for titanium dioxide pigment production. They can also be
used to beneficiate a range of heavy minerals, as well as process waste chloride streams from a number of industrial operations.
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· Like the Mindarie Project, it is well positioned near rail and other infrastructure
· The ‘core’ deposit covers approximately 44km2 on predominantly cereal
cropping and grazing land
· A reasonable global estimate is 750Mt at 4.0%HM, with an average thickness of
the ore body of 10.3m (range 3.8-14.5m)
· Overburden thickness averages 7.8m including around 4.5m of clay (remainder
barren sand).
The farm-in agreement positions Austpac to receive financial benefit from the deposit
without requiring any immediate cash investment. This allows Austpac to concentrate on
near-term commercialisation opportunities for its ERMS/EARS technology platform, as
demonstrated by the recent announcements regarding:
· A 30,000 tpa ERMS synthetic rutile plant in eastern Australia (Consolidated Rutile
Limited and Iluka Resources Limited)
· A roasting plant using Austpac’s LTR technology (NZ Steel, a subsidiary of
Bluescope Steel) and
· The use of the Company’s EARS acid regeneration process for the Goro Nickel
Project in New Caledonia (Inco).