REG - East Star Resources - Initiation of Farm-Out Process for Verkhuba

East Star ResourcesAnnouncement

03/04/2024 07:15

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RNS Number : 1227J  East Star Resources PLC  03 April 2024

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:

 ·         Several parties, including mid-tier mining companies, have been provided
           access to the data room
 ·         One non-binding offer has been received to date
 ·         Process expected to be finalised in June, in time for drilling to commence in
           the forthcoming field season

 

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 (http://www.eaststarplc.com)

 

Follow us on social media:

LinkedIn: https://www.linkedin.com/company/east-star-resources/
(https://www.linkedin.com/company/east-star-resources/)

 

X (formerly Twitter): https://twitter.com/EastStar_PLC
(https://twitter.com/EastStar_PLC)

 

Subscribe to our email alert service to be notified whenever East Star
releases news:

 

www.eaststarplc.com/newsalerts (http://www.eaststarplc.com/newsalerts)

 

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.

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