3 April 2024
East Star Resources
Plc
("East Star" or the
"Company")
Initiation of Farm-Out
Process for Verkhuba
East Star Resources Plc (LSE:EST), the Kazakhstan focused copper exploration and
resource development company, is pleased to announce that, as a
consequence of interest in the Verkhuba copper deposit ("Verkhuba"
or the "Copper Deposit") having been received from several
companies, the Company has initiated a formal process including the
opening of a data room for a potential joint venture, farm-out, or
sale of the Copper Deposit ("Transaction").
Highlights:
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Several parties, including mid-tier
mining companies, have been provided access to the data
room
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One non-binding offer has been
received to date
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Process expected to be finalised in June, in
time for drilling to commence in the forthcoming field
season
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The process is expected to take
several months and will run in parallel with continued preparation
for the upcoming field season, beginning with the publication of a
maiden JORC Inferred resource. The work programme is anticipated to
include drilling, targeting a conversion of the main open pit area
to a JORC Indicated resource, further testing the continuity of the
primary underground ore bodies, and drilling several exciting
geophysical targets in other areas of the licences on the Rudny
Altai Volcanogenic Massive Sulphide ("VMS") belt.
Alex Walker, CEO, commented:
"East Star believes the value of Verkhuba alone significantly
exceeds the current market capitalisation of the Company and as
such will only consider proposals that offer a fair valuation for
shareholders and exposure to the near-term production potential of
the Copper Deposit at a time when a multiyear copper bull market is
being predicted by most market analysts.
The open pit and underground potential of Verkhuba have been
demonstrated by the modelling of more than 46,000 meters of
drilling and numerous geological interpretations by independent
resource consultants. There is around 1.4 million tonnes per annum
of excess processing capacity from two third-party concentrators
within 52km by road of the Copper Deposit. With power and water
easily accessible on site, the opportunity for Verkhuba to be put
into production quickly and with a low upfront capital cost is
compelling and reflected in the interest received to date.
We
look forward to undertaking this process while planning continues
for the field season, including advancing a number of exciting VMS
targets in the licence package towards drilling, and progressing
our porphyry and sediment-hosted copper exploration
strategies."
There can be no certainty that a
Transaction will be concluded; however, given the significant
processing infrastructure in the region, the Company is confident
of receiving multiple commercial offers.
East Star
Resources Plc
Alex Walker, Chief Executive
Officer
Tel: +44 (0)20 7390 0234 (via Vigo
Consulting)
SI
Capital (Corporate Broker)
Nick Emerson
Tel: +44 (0)1483 413 500
Peterhouse Capital Limited (Corporate
Broker)
Peter Greensmith
Tel: +44 (0) 20 7469 0930
Vigo Consulting (Investor Relations)
Ben Simons / Peter Jacob
Tel: +44 (0)20 7390 0234
About East
Star Resources Plc
East Star Resources is focused on the discovery
and development of strategic minerals required for the energy
revolution. With eight licences covering >1,000 km² in three
mineral rich districts of Kazakhstan, East Star is undertaking
an intensive exploration programme, applying modern geophysics to
discover minerals in levels that were not previously explored. East
Star's most advanced project is a copper deposit on the world-class
Rudny Altai VMS Belt where the Company is working towards the
delivery of a JORC compliant open pit copper resource close to
infrastructure, within trucking distance of third-party mills with
excess capacity. East Star's management are based permanently on
the ground, supported by local expertise, a joint venture with the
state mining company on certain projects, and grant funding from
BHP through the BHP Xplor programme for copper porphyry
exploration.
Visit our
website:
www.eaststarplc.com
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The person who
arranged for the release of this announcement was Alex Walker, CEO
of the Company.
This announcement contains inside information
for the purposes of Article 7 of Regulation 2014/596/EU which is
part of domestic UK law pursuant to the Market Abuse (Amendment)
(EU Exit) Regulations (SI 2019/310) ("UK MAR"). Upon the
publication of this announcement, this inside information (as
defined in UK MAR) is now considered to be in the public
domain.