Korean Recycling Project Update
07 December 2010 - 6:00PM
UK Regulatory
TIDMZOX
RNS Number : 4634X
ZincOx Resources PLC
07 December 2010
ZincOx Resources plc
("ZincOx" or "the Company")
7 December 2010
South Korean Recycling Project - Site Leased
ZincOx (AIM:ZOX) is pleased to announce that its wholly-owned subsidiary, ZincOx
(Korea) Limited, has signed a 50 year lease for the site ("KRP Site") of its
Korean Recycling Project ("KRP"). The Lease provides for a minimum rent-free
period of five years provided that ZincOx completes the development of Phase 1
of the KRP within two years and the development of Phase 2 within four years.
ZincOx expects to complete the developments within this timetable. Under certain
conditions ZincOx will also be eligible for rent-free status beyond five years.
The KRP Site covers 9.26 hectares within the Cheonbuk General Industrial
Complex, which is already environmentally permitted. The KRP Site is
strategically located approximately 10km west of Pohang, in south-west South
Korea. Pohang is one of South Korea's major steel producing centres, and will
supply approximately 20% of KRP's feed requirements. It will also host potential
customers for KRP's iron product, ZHBI. Pohang's port facilities already import
coal and are well suited to any export of KRP's finished products. The KRP Site
is also located close to the main Seoul-Busan motorway providing excellent road
access for the transport of electric arc furnace dust ("EAFD") from steel mills
elsewhere in South Korea.
The KRP will process EAFD, a waste generated throughout South Korea by steel
recycling companies. ZincOx has 10 year supply contracts for 400,000 tonnes of
EAFD per annum (23% zinc) which is currently disposed of in landfill sites at
some cost to the steel recycling companies. ZincOx's phased development plan
foresees the treatment of 200,000 tonnes of EAFD in Phase 1 to produce
approximately 60,000tpa zinc oxide concentrate at 73% zinc and approximately
95,000 tonnes per annum of ZHBI, an intermediate iron product. In Phase 2 ZincOx
plans to treat a further 200,000 tonnes of EAFD and produce annually a total of
approximately 120,000 tonnes of zinc oxide concentrate and approximately 190,000
tonnes of ZHBI.
ZincOx expects to have offtake arrangements in place prior to commencement of
construction of Phase 1 of the plant for the zinc oxide concentrate and for
ZHBI, which could also be sold into the scrap spot market.
KRP has received strong support from the South Korean Government, as
demonstrated by the designation of the KRP Site as a Foreign Investment Zone
("FIZ") and by its decision to allocate funds for the purchase of the KRP Site
and its lease to ZincOx on advantageous terms. Foreign Investment Zone status
also entitles KRP to certain tax privileges including an exemption from
corporation tax for a period of five years.
The signing of the lease over the KRP Site enables ZincOx to push forward with
its development timetable. Detailed engineering is now underway and the rotary
hearth furnace and ancillary equipment purchased by ZincOx in the USA at the
start of 2010 are now being dismantled in preparation for their shipment to
South Korea. ZincOx expects the first production of zinc concentrate from the
KRP in Q1 2012.
Commenting on the announcement, Andrew Woollett, ZincOx's Executive Chairman
said: "The development of the KRP is beginning to gain significant momentum, and
at the same time we are making good progress with our financing plans"
Corporate
As required by AIM Rule 17 and Schedule 2 Annex III, the Company has made
updated disclosure on information relating to directors of the Company on its
website at http://www.zincox.com/about/directors.asp
For information please contact:
ZincOx Resources plc
Andrew Woollett, Executive Chairman
Peter Wynter
Bee, Managing Director
+44 (0) 1276 450100
Nominated Adviser and Broker
Ambrian Partners Limited
Andrew Craig / Jen
Boorer
+44 (0) 20 7634 4700
Conduit PR
Charlie Geller / Paul Youens
+44 (0) 20 7429 6604
This information is provided by RNS
The company news service from the London Stock Exchange
END
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