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UXA Resources hits the wall

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Adelaide-based minerals explorer UXA Resources has ceased trading, leaving shareholders with an empty wallet.

In a statement today, company secretary Graeme Seppelt said the mining downturn and a cash shortfall had been too much for the company.

UXA had prospects in South Australia and the Northern Territory.

It also had a downhole logging business that was aimed at providing an additional revenue stream.

“The hurdles that have been put in front of the company over the last 10 months have finally taken their toll and the company has ceased to trade,” the statement said.

“Directors note that the downturn in the mining industry influenced the reduction in down hole logging opportunities which ultimately drained the cash resources of UXA whilst it attempted to maintain its wholly owned subsidiary Geoscience Services Australia Pty Ltd (now in liquidation).

“In addition, the inability to agree terms with its Note Holders for the conversion of Unsecured Notes into equity reduced the ability for the company to recapitalise its balance sheet in these difficult capital raising times.”

Then statement included an apology to shareholders.

“The directors sincerely apologise to all stake holders for the ultimate demise of the company.

“Up until late last Friday it was still hoped that a deal with the Note Holders could be reached which would then have allowed an interested third party junior explorer to join UXA with some exciting new tenements.

“As this did not eventuate, the Directors of UXA have resolved to cease trading, effective immediately.”

The company had  joint venture partners including Reliance Industries (India’s largest private company), Canada’s largest mining company Teck Resources Limited and Australian copper and gold miner Straits Resources Ltd.

It had been exploring for uranium at Nabarlek in Arnhem Land in the NT and had been positive about drilling results for silver, lead and zinc near Broken Hill.

UXA held nine granted exploration licences totalling 3314 square kilometres of prospective deposits in South Australia.

UXA’s managing director Dr Russell Penney resigned last month.

Its chairman is Neill Arthur and directors are David Sutich and Ian Mutton.

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