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IMX sells Mt Woods assets, extinguishes Flinders Port liability

IMX sells Mt Woods assets, extinguishes Flinders Port liability

Photo by Bloomberg

10th September 2014

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – Mining and exploration company IMX Resources has agreed to sell its Mt Woods tenements, in South Australia’s Woomera area, to private company Cu-River Mining Australia for A$3.68-million.

“While the Mt Woods tenements contain a substantial magnetite resource, potential shareholder returns from this development will require significant funding and take considerable time to explore and develop,” said IMX chairperson Derek Fisher.

He noted that the disposal of these assets meant that the Flinders Port liability could be extinguished without shareholder dilution at the corporate level, and considering the current iron-ore price environment, was an excellent outcome.

IMX was left with a A$3-million liability to Flinders Ports following the collapse of the Cairn Hill iron-ore joint venture (JV), in June this year.

The mine’s JV partner Termite Resource went into administration following the decline of iron-ore prices.

All contractual liabilities for the Cairn Hill mine were the obligation of Termite, except for a guarantee provided by IMX under the port handling services contract with Flinders Ports. This guarantee had been capped at A$3-million.

Fisher said on Wednesday that extinguishing the Flinders Port liability would allow IMX to focus its efforts on exploring the Nachingwea property, in Tanzania, and in particular the Chilalo graphite and Kishugu gold prospects, where drilling was planned to start in October.

The sale of the Mt Woods asset was conditional upon regulatory approval, as well as permission being granted under the Defence Act, given that the tenements are located in the Woomera prohibited area.

In July, the federal Parliament passed the Defence Legislation Amendment Bill, allowing for access to the Woomera area, potentially unlocking potential mineral resource discoveries worth an estimated A$35-billion.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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