Yorke Peninsula miner Rex Minerals has accepted the State Government’s mining lease offer for its Hillside Copper-Gold-Iron Ore Project near Ardrossan.
Rex has now received all the necessary state and federal consents and approvals to develop the Hillside Project, but it is still assessing its feasibility as a smaller scale staged development.
Rex Executive Chairman David Carland said the lease confirmation was a significant milestone.
“The offer documentation was very comprehensive and covers a large number of conditions which are important for the operability of the project and the protection of all stakeholders on the Yorke Peninsula,” he said in a statement Tuesday.
“This process has taken considerable time however; work completed by both Rex and the South Australian Government will ultimately strengthen the security of the project in the long term.”
The lease conditions, State Government assessment report and supporting technical appendices will be released by the South Australian Government.
After encountering problems raising capital for a large-scale development, Rex extended its feasibility study to include a smaller scale, lower capital start-up option, frustrating investors.
With its share price at record lows last month, David Carland moved to calm shareholders’ nerves after the board accepted the resignation of its chief executive.
Investors headed for the exit door, sending the share price into freefall.
Its current price of 27.5 cents is barely above the float price of 25 cents back in September 2007.
Others had come on board in various capital raisings over the years; the company raised $5.5 million at 40 cents in March 2009, another $5.6 million at 70 cents in May 2009, and dipped in again for $42 million at $1.70 in November 2009.
The investors who spent $87 million buying in at $2.50 in October 2010 were more concerned.
Carland’s letter to shareholders in August promised that it’s still all systems go.
“Hillside is economically robust. A smaller-scale start-up will, by its very nature, be easier to finance and allow for a broader range of possible partners, or greater opportunity to ‘go it alone’,” the chairman said.
“The greater share of equity we retain for shareholders, the more value we believe will be created and returned.”
