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Stellar Resources Limited (ASX: SRZ) announces that the Tasmanian Minister for Resources has granted Mining Lease ML 10M/2017 over the St Dizier tin deposit. The lease would permit Stellar with unencumbered title to extract tin and other metals from St Dizier for six years. St Dizier increases the range of development options for the Heemskirk Tin Project.
An internal Scoping Study on the development of an open pit mine at St Dizier was completed in 2015 which, along with the Stage 1 environmental assessment, formed the basis of the Companyâs application for a Mining Lease to the Tasmanian Government that resulted in the grant of ML 10M/2017. The 2015 scoping study financial analysis has been updated to reflect the current tin price and current exchange rates. The other assumptions remain the same as the 2015 study.Â
The shares of SRZ skyrocketed by 25%, settling the dayâs session at A$0.015, as compared to the previous day close of A$0.012.
The updated St Dizier Scoping Study valuation has resulted in a base case NPV 10%, at current tin prices (US$20,000/t), determined to an accuracy of ±35%, of approximately A$10.4m, an IRR of roughly 166% and a payback period of approximately eight months. The project has a low capital investment estimated at A$3.8m and can be bought into production within three months of receiving approvals providing flexibility to ensure that it is developed in a supportive tin price environment.
Tasmanian Government approval of the St Dizier Mining Lease, ML 10M/2017, was based on Stellarâs Stage 1 environmental assessment, ore processing at Zeehan and the open pit mine development plan summarized by the base case scoping study outcomes. The study assumes that ore is mined at the maximum rate feasible, given the physical constraint of mining in a narrow pit, and that processing capacity is available to treat all ore produced.
Managing Director Peter Blight said that the granting of ML 10M/2017 shows strong support from the Tasmanian Government for Stellarâs tin development strategy. The Company is now well positioned with all its JORC compliant tin mineral resources under long-term tenure. St Dizier provides the potential for development of a low-cost open pit with ore processed through the Companyâs proposed processing facility at Zeehan or through a third-party facility.
St Dizier is sited 20km to the northwest part of Zeehan. It is positioned within 1km of the all-weather Heemskirk Road which connects the project to Zeehan. St Dizier also has access to a power transmission line that runs from the Reece Dam along the Heemskirk Road to Zeehan. St Dizier lies within EL46/2003, a 93km2 exploration license held by Stellar that contains several tin occurrences along the northern and southern edge of the Heemskirk Granite. St Dizier is the only occurrence within EL46/2003 that has yielded a tin resource which is now secured by ML 10M/2017. ML 10M/2017 covers an area of 2km2, enough to cover all requirements for the development of the St Dizier tin deposit as an open pit mine.
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