Allup Acquires 100% of McLaren Valuable Heavy Mineral Sands Project, West Eucla Basin, WA and Conducts Placement
Allup Silica Limited (ASX: APS) (“Allup” or “Company”) is pleased to announce it has acquired 100% of an advanced Valuable Heavy Mineral Sands Project near Eucla, WA.
Highlights
Advanced Valuable Heavy Mineral Sands (VHMS) project in WA has an indicated and inferred JORC Resource (2012) of 280Mt @ 4.8% Heavy Mineral near surfaceProject comprises 333 sq km of tenements, 150km east of Norseman in the mining-friendly jurisdiction of Western Australia.Potential for expanded MRE by including results not in current resource extended, plus extended mine life through additional drilling.Ilmenite, a key titanium mineral, is priced well above international silica and kaolin prices at more than US$300/t1 due to increasing titanium shortages.Strong ilmenite market demand expected to continue due to supply deficits and mine closures in Kenya, South Africa, and MozambiqueAllup plans to focus on a lower-cost Capex design to fast-track mine development and produce a bulk concentrate.Placement of $360,000 to raise working capital.
McLaren VHMS Project (E69/2388 and E69/2386) comprises 333km2, located on the western side of the Eucla Basin, adjacent to the Fraser Range in Western Australia (Figure 1).
McLaren is an advanced-stage exploration project with an indicated and inferred Mineral Resource estimate of 280Mt @ 4.8% Heavy Mineral for 13.5Mt in-situ HM completed in 2022.
Allup Silica Managing Director Andrew Haythorpe said: ‘This Project presents an excellent opportunity for Allup Silica to fulfill its plan of moving into production. Albeit a different sand, the mining and washing processes for ilmenite are similar to silica sand, as well as the near-surface mineralisation and low strip ratios. However, the higher product price and lower shipping volumes present a compelling opportunity for development.
Because of the previous work completed and the increasingly high value of titanium minerals, this opportunity presents a faster and higher confidence pathway for Allup Silica and its shareholders. The ground is accessible in all seasons of the year, allowing for more rapid progress. Infill drilling and further metallurgical work is planned to commence as soon as practicable so that we can advance a Pre-Feasibility Study and move onto a Bankable Feasibility Study for the project.’
Acquisition Consideration for 100% of the McLaren VHM Project
The Company has agreed to pay the following consideration:
A$150,000 in cash for 100% of ELsAllup grants a 1.5% Royalty to the vendors (Westover Holdings Pty Ltd and Wild Side (WA) Pty Ltd)Allup will issue 2m options exercisable at 20c on or before 5 years from issue, with consideration of$0.001 per APS share, with a vesting condition being completion of a Bankable Feasibility Study and the Ilmenite concentrate sales exceeding US$500/t from the Project4,241,571 shares upon completion of the Pre-Feasibility Study (PFS); (PFS Milestone) andA further 4,300,583 shares will be issued upon completion of a Feasibility Study (FS Milestone).
The PFS Milestone is satisfied upon completion of a Pre-Feasibility Study on commercially viable terms and other criteria that the Parties agree in writing.
In the event that the PFS Milestone is not achieved within 24 months, the Parties agree to enter into good faith negotiations for a period of 5 business days with a view to agree an alternative basis on which the PFS Milestone Shares (or any part thereof) may be issued to the Vendors.
Subsequent to the PFS Period, the Purchaser agrees to use all reasonable endeavours to conduct a Bankable Feasibility Study in respect of the Tenements.
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