STRIKE RESOURCES LIMITED - ASX: SRK

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Description

Strike Resources is an Australian-listed resources company with two principal projects in the attractive bulk commodities market. The Apurimac and Cuzco Iron Ore projects in Peru are large scale iron ore projects, with Apurimac in the Pre-feasibility Study stage. The company is seeking to establish a 10 – 20 million tonne per annum (Mtpa) operation based on current JORC Indicated and Inferred Resources of 270Mt with significant exploration upside. The Berau thermal coal project in Indonesia is an asset with near-term cash flow potential. With low capital expenditure and key approvals in place, this asset has the potential to become a producing asset in the short term.

Apurimac Iron Ore Project

The objective of the Apurimac Iron Ore Project is development of a mine producing up to 20Mt of high-grade (68%Fe) product per year. Key project features:

* 72 concessions totalling 59,000 hectares in the Southern Highlands of Peru.
* JORC Resource of 269Mt of iron ore at Opaban of 57.3% Fe (142 Mt Indicated, 127 Mt Inferred).
* Excellent exploration potential within current concessions with several targets containing ironstones grading >60%Fe in similar geological settings to Opaban.
* Estimated capital expenditure of US$ 2.3 – 2.9 billion, competitive with other major iron ore projects.
* Projected operating expenses of US$ 17 – 20 per tonne of product, placing it in the lowest quartile for OPEX among iron ore mines worldwide.
* Location and Geography
* The Apurimac project is located in the Southern Highlands of Peru.

Berau Thermal Coal Project

The objective of the Berau Thermal Coal Project is the successful development of a mine producing up to 3Mt of thermal coal per year. Key Project features:

* Concession area of 5,000 hectares in East Kalimantan, Indonesia.
* JORC Resource of 27.7Mt of thermal coal with medium calorific value ([5,600] kcal/kg gross as received) with low sulphur, ash and moisture.
* Substantial further exploration potential.
* Required capital expenditure of US$ 20 million.
* Projected operating expenses of US$ 41 per tonne.
* Mining reserve of 7.7Mt from 10.4 Mt of JORC Resource at Nyapa West.
* 7-8 months construction time from investment decision with further 2 months till first shipment.

The operation will involve mining and transporting run of mine coal by truck approximately 30 km along a proposed road to a barge port to be constructed on the Segah River, where it will crushed directly on to barges. Barges will then transport the coal approximately 90km to the coast and then on to a trans-shipment point 30km offshore, where it will be offloaded to ships for delivery to customers.

Cuzco Iron Ore Project

Strike has two areas of focus within the Cuzco Project:

* 1. Cuzco Lump: The development of a one to two million tonnes per annum lump iron ore operation mining high grade (+60% Fe) near surface hematite mineralisation with the direct shipping ore (DSO) being transported to the existing port of Matarani through a combination of trucking and rail transport;

* Cuzco Stage 2: The development of a second 20 million tonnes per annum mining operation and second slurry pipeline to integrate with the 20 million tonnes per annum mining operation proposed at Apurimac with the concentrate product being transported to the coast through the connection of a second slurry pipeline to the first slurry pipeline.

Mine For

iron ore, coal

Location of operation(s)

Peru, Indonesia, Western Australia

Address

Level 8, The Forrest Centre, 221 St Georges Tce
PERTH, WA, AUSTRALIA

Phone

(61 8) 9324 7100

Email

Website

http://www.strikeresources.com.au

Last Updated

2/02/2011