ASX Company Announcement
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Admiralty Resources NL
ACN 010 195 972
Level 14, 200 Queen Street
Melbourne VIC 3000
[t] +61-3-96701838
[f] +61-3-9670 1898
[w] www.ady.com.au
26 July 2007
Company Announcements Office
ASX Limited
20 Bridge Street
SYDNEY NSW 2000
ADMIRALTY MOVES TO 60% OWNERSHIP OF
CIA MINERA SANTA BARBARA FOR USD15M
Highlights
• Admiralty Resources wholly owned subsidiary has acquired an additional 10% of
Cia Minera Santa Barbara for USD$15 million from its joint venture partner
• Payment will be by issue of 10 million shares and USD$10m in cash
• The 10% purchase will increase Admiralty Resources stake to 60%, resulting in
management and equity control
• This increase in equity will increase Admiralty Resources’ earnings by 16% from
the Joint Venture
• Both shareholders of Cia Minera Santa Barbara, Wyndham Explorations and
Fortune Global Holdings Corporation (a 100% owned subsidiary of Admiralty
Resources NL) are committed to the expansion of the Santa Barbara Northern
Chile project to produce 5 million tonnes per annum of iron ore fines product when
port capacity becomes available.
The board of Directors of Admiralty Resources is delighted to announce that it has reached
agreement with its current 50% shareholder Wyndham Explorations SA to acquire a further
10% of Cia Minera Santa Barbara, the owner of the Santa Barbara iron ore project in Region
Three in Northern Chile.
The acquisition cost is approximately USD$15m and will be paid for by issuing Wyndham
Explorations SA with 10 million Admiralty Resources shares and payments totalling USD$10m
in cash. The transaction will be finalised at the end of this week. Whilst the purchase price
implies a current valuation of USD$150 million, the directors believe once the asset reserves
are determined, a significant re-rating of the asset will occur.
Both parties are delighted at the outcome, and it will allow Admiralty Resources to aggressively
pursue its objective to expand both the plant and the port capacity to the maximum permitted by
its current environmental permits to increase the revenues earned by Cia Minera Santa
Barbara. To date Santa Barbara has accessed finance from a USD$20m loan provided by
Admiralty Resources, which must be repaid first prior to distributions being made to the
shareholders.
The change in equity will become effective this week and further announcements on changes or additions to management, production, shipping and reserves will be made as they occur. The
immediate focus is to ensure that the necessary equipment is delivered and installed at the new
Santa Barbara plant to take it into full production at 100,000 tonnes of final product (63.5% iron
ore fines) per month as soon as possible and that the recuperation continues to improve by
improvements to the plant design, additional equipment and mine planning.
The Company has received a number of funding proposals and is expecting to finalise a debt
facility to fund the purchase of shares and expansion of the project this week.
Phillip Thomas, Managing Director and fellow Director, Anthony Blumberg are currently at the
Santa Barbara mine working with management and will meet with key strategic partners SRK
Consulting who have been engaged to prepare a scoping study for the new plant expansion
and a JORC calculation of the extent of the reserve at Japonesita, Primavera and Mariposa
tenements which cover some 310 hectares. To-date, only 32 hectares at Japonesa have been
assessed using JORC methodology calculating a measured and indicated resource. Please
refer to the previous ASX release lodged on14 May 2007 for specific details. Cia Minera Santa
Barbara (of which Admiralty Resources now holds 60%) has tenements that cover more than
11,000 hectares in the Chilean iron ore belt.
Yours sincerely,
Phillip Thomas
Managing Director
[e] pthomas@ady.com.au
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