Admission to AIM
23 November 2004 - 7:44PM
UK Regulatory
RNS Number:5288F
Van Dieman Mines plc
23 November 2004
23 November 2004
Admission to trading on AIM after #3.32 million placing
Tin and Sapphire production in Tasmania (Australia) due to commence in Q4 2005
Funds to be used to bring mine into production and develop global
sapphire distribution
The Directors of Van Dieman Mines ("Van Dieman" or the "Company"; Ticker:
"VDM"), the Tasmanian Tin and Sapphire developer, today announces the
commencement of trading on AIM after a placing by Ambrian Partners raised #3.32
million, before expenses. The Company is issuing 11,066,000 Placing Shares,
representing 15.4 per cent. of the enlarged issued share capital of the Company,
at 30p per Ordinary Share. This equates to approximately 15.2 per cent. of the
fully diluted share capital, assuming the exercise of all the Options. The
Placing will raise #3.32m (before expenses), of which #2.98m will be receivable
by the Company. Grant Thornton Corporate Finance is acting as the Company's
Nominated Adviser and Ambrian Partners Limited as the Company's broker.
Van Dieman owns, through its 100% subsidiary Van Dieman Australia, thirteen
exploration licences which lie within the north east Tasmanian tin region that
stretches from the Blue Tier granite massif in the south through to the north
and north east coasts and into offshore Bass Strait of Australia. This region
has been a significant contributor to the overall production of tin and precious
stones in Tasmania. Historical records up to 1980 indicate that in excess of
40,000 tonnes of tin has been recovered from the region, most of it from
alluvial operations.
An independent technical review confirmed resources in excess of 100 million
cubic metres at three of the licences- Scotia, Central Ringarooma and great
Northern Plains. Of this 51.2 million m3 is in the measured category, (11.5
million m3 in Scotia and Ringarooma; 39.7 million m3 in Northern Plains) and
27.5 million m3are in the inferred category. The Company will use the funds
raised to commence production by Q4, 2005 at the tin and sapphire bearing -
Scotia and Central Ringarooma licences, estimated to have a 15 year mine life,
which will be followed by an exploration programme at the Northern Plains
licence. The Company's alluvial mineral resources encompass a number of discrete
project areas- Endurance and Pioneer form part of the Central Ringarooma area
and are "stand alone" projects whilst others including the Scotia, Great
Northern Plains and Offshore licences are linked together such that they each
form one part of a major resource area.
After allowing for project and supplier funding and use of equipment leasing and
financing facilities, the Company estimates that the total cost of putting the
Scotia and Central Ringarooma deposits into production will be #1.4m. Plant and
equipment estimated at #5.4m will be debt funded from operating leases and/or
dry hire of equipment.
Van Dieman's strategy for the next two years centres around establishing stable
mining operations at Scotia and Endurance, optimising minerals extraction and
processing and establishing reliable outlets for the mine production at premium
pricing. The Company also intends to complete exploration in zones around the
resources at Scotia and Endurance and then to commence exploration of the Great
Northern Plains tenements to confirm economic viability for mining.
Commenting today on Van Dieman's Admission to AIM Clive Trist, Managing
Director, said: "An independent feasibility study has indicated strong
financials for a mine on our licences and we are aiming to bring this into near
term production during Q4 2005. Significant work has been performed compiling
drilling and exploration data on our licences and we are confident that an
aggressive exploration programme once the mine is in production has the
potential to add significantly to our existing resource."
For more information
Clive Trist, Van Dieman Mines
Fiona Reid, Grant Thornton
Richard Chase, Ambrian Partners
Laurence Read/ Leesa Peters, Conduit PR +44(0) 20 79369095 /+44 (0) 7979 955 923
laurence@conduitpr.com
Appendix
Appendix
Mineral resources
Tenement Volume (million m3) Grade (kg SnO2 / m3) Total SnO2 Resource Strip ratio
Ore Overburden (tonnes) Classification
Central
Ringarooma
Endurance 1.57 8.94 1.065 1,674 Measured and 5.7
2.40 0.972 2,330 Inferred
Pioneer 4.62 22.73 0.872 4,027 Measured and 4.9
Inferred
Scotia 5.32 24.90 1.300 6,913 Measured and 4.7
21.35 0.348 7,430 Inferred
Gt. Northern
Plains
Fosters Marsh 34.10 77.40 0.260 8,878 Measured 2.3
Braithwaites 5.16 14.46 0.282 1,416 Measured 2.8
Peripheral
Resource Areas 39.70 0.100 to 0.300 Inferred 2.3 to 2.8
Sale of Auxiliary Minerals
Van Diemans intends selling the gold ore fraction from the mine treatment plants
to the Perth mint and has had preliminary discussions with smelters who, from
the tin smelting process, also wish to credit the Company for the magnetic tin
fraction containing the Zircon, Rutile and Tantalite minerals.
Off-take agreements for tin and sapphires
The Company has received draft contracts from Malaysian Smelting Corporation and
Thailand Smelting and Refining Co. Limited for purchase and/or smelting of tin
concentrates, including both purchase of, and hedging options for, the refined
tin metal. These will be reviewed post Admission and a long term contract will
be executed with the preferred dealer.
Agreements concerning the distribution and sales of sapphire products have been
signed with two distribution and selling agents in the US. Further agreements
are being negotiated and discussions are being held with jewellery manufacturers
for Van Diemans to supply their sapphire requirements.
The Tin Market
- Forecast global production in 2004 290,000 tonnes
- LME stocks at 23 September 2004 5,350 tonnes
- Forecast global demand in 2004 315,000 tonnes
- Forecast supply shortfall in 2004 25,000 tonnes
Source: - LME website & CRU Group
Industrial consumption:
- Solders 32%
- Tin plate 27%
- Alloys 14%
- Others (PVC, fire retardants etc.) 27%
Source: - LME website
Source: London Metal Exchange 23 September, 2004 & CRU Tin Monitor June 2004
The main growth drivers for the global tin market are as follows:
*predicted legislation in the US and the European Union banning the use of
lead in solders, shotgun pellets and bullets;
*decisions by Dell and other computer manufacturers not to use lead based
solders in their products; and
*continued, strong economic growth from China.
The Sapphire Market in the US, the European Union and Japan:
Year 2001 2002 2003
Six months to Sept Six months to Sept Annual
US$ millions US$ millions US$ millions
US 273.3 304.5 612.0
Source: United States Department
of Commerce
European Union 175.5 155.5 307.8
Source: Eurostat/Haver Analysis
Japan 93.0 89.3 143.0
Source: Jewellery Trade Centre, Japan
Total 1,062.80
Source: Coloured Stone - International Reporter of the Gemstone Trade January/
February 2002, 2003 & 2004:
The following table shows the top 10 selling gemstones in the US:
2001 2002 2003
Blue sapphire Blue sapphire Blue sapphire
Pearl Ruby Ruby
Tanzanite Emerald Tanzanite
Ruby Tanzanite Emerald
Emerald Amethyst Amethyst
Amethyst Rhodolite garnet Blue topaz
Green tourmaline Pearl Tsavorite garnet
Rhodolite garnet Opal Aquamarine
Fancy sapphire and Peridot Opal
Pink tourmaline
Blue topaz Blue topaz Green tourmaline
Source: Coloured Stone - International Reporter of the Gemstone Trade January/
February 2002 & January/February 2003
Statistics published by the International Reporter of the Gemstone Trade show
that for the year 2003 sapphire accounted for over 22 per cent. of the gemstone
market in the US.
Profile of Tasmania
Tasmania is the southernmost state of Australia, separated from the continent by
the Bass Strait and is similar in size to the Republic of Ireland. Tasmania is a
group of over 300 islands, centred around one main island, which has a coastline
of more than 3,000 km. The population of Tasmania is around 475,000, of which
approximately 195,000 live in the capital city of Hobart. Tasmania has a mild,
temperate maritime climate with average temperatures of 21oC (70oF) in the
summer and 12oC (52oF) in the winter.
Tasmania has well-developed internal transport systems with a well-maintained
road and rail network and reliable air and sea links with the rest of the world.
Tasmania also has a reliable, state wide hydro electricity grid, supplemented by
natural gas generation, and an efficient, advanced telecommunications network.
The mineral industry has played a significant part in Tasmania's economic and
cultural development for well over 150 years and the geology is supportive of an
active minerals exploration and mining industry. A diverse range of commodities
are exported, including ores and concentrates of iron, copper, lead, zinc, tin,
gold, high grade silica and tungsten, as well as refined zinc and aluminium and
ferro-alloys.
Directors
Mr Michael Spriggs, Non Executive Chairman, aged 61
Michael Spriggs has 27 years mining sector experience. He graduated from Oxford
University with a B.A. (Honours) in 1964 and he obtained an M.Sc. in Geology and
Mineral Sciences from the University of Leicester in 1969. He worked as an
exploration geologist on a range of international assignments for a number of
major mining groups, including Anglo American, Falconbridge and Rio Tinto. He
spent 11 years with the mining team of the UK investment bank, SG Warburg (now
UBS) from 1986-97. He was appointed Head of the South African Mining Equities
Research Team, was subsequently appointed Director of Corporate Finance, and was
involved in a number of major cross-BORDER="0" mining transactions. In 1997 he
was appointed a Partner at College Hill, the UK public relations consultancy, as
Head of the Mining Team.
Mr Clive Trist, Managing Director, aged 60
Clive has over 10 years senior management experience with Australian and
multinational public companies in general management and new business venture
roles. He has spent the last 18 years with venture capital, investment banking
and corporate advisory firms involved in corporate restructuring, M&A, debt and
equity fund raisings and company start-ups. Between 1991 and 1995 he was a
Partner in the investment banking firm MACC Partners, a joint venture with
Malaysia Borneo Finance Corporation. He has held various directorships including
Chairman, for 10 years, of a successful UK engineering group operating in
Europe, North America and S.E. Asia. Clive holds a Bachelors Degree in
Engineering, a Masters Degree in Business Administration and is a Foundation
Fellow of the Australian Institute of Company Directors.
Mr Ken Frey, Executive Director - Marketing, aged 58
Ken has over 20 years experience with a leading Japanese trading house and
merchant bank involved in major infrastructure projects. Projects managed during
that period included the funding, supply and commissioning of water turbines for
six of the Tasmanian government's electricity grid power stations and the
initiation of Facom's computer marketing programme in Australia. Ken spent over
7 years in New York as a director of a successful group of start up companies.
This involved the establishment and maintenance of a network of distributors
stretching from Chicago through eastern seaboard Boston to San Juan. He has also
undertaken M&A assignments, debt and equity fund raisings and company start ups
in Australia and the US Ken holds a Bachelors Degree in Economics.
Mr Neil Kinnane - Executive Director - Exploration & Operations, aged 57
Neil has over 35 years geology, exploration and mining experience, much of it
involving alluvial gold, tin and gemstone projects. In 1978 Neil was
instrumental in establishing a large alluvial tin operation in North Queensland.
During the period 1980 to 1988 Neil was Chief Geologist with Normin Consultants
specialising in the field of alluvial mine developments in Australia and Papua
New Guinea. Since 1990 Neil has provided geotechnical services to clients in
Papua New Guinea, Lao People's Democratic Republic, Thailand, Vietnam, Cambodia
and the US in the areas of alluvial gemstones and gold and hard rock gold,
industrial minerals and petroleum. During this period, in a trouble shooting
capacity, Neil managed the Great Northern Sapphire mining operation. Neil holds
a Fellowship Diploma in Geology from the Royal Melbourne Institute of
Technology. He is a Fellow of the Australasian Institute of Mining and
Metallurgy and a Chartered Professional Geologist.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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