Stonehenge completes due diligence on Sulawesi nickel project

Australian exploration firm Stonehenge Metals Limited announced on Monday that it had completed due diligence in respect to its acquisition of an 85 percent stake in the Mandiodo nickel project, South East Sulawesi and is now proceeding to complete the acquisition.

Under the deal, the company would pay non-refundable fee of A$400,000 and would issue 15 million of the company?s shares upon completion to local company PT.Global Titik Persada (GTP). The company will also issue another 30 million shares to GTP once a JORC-compliant resource of at least 50 million tonnes at 1.3% nickel is achieved.

The company had also purchased 2.4 million shares Sunda Resources Pty. Ltd., which has interests in exploration permits surrounding Mandiodo project. for $600,000

The project consists of two adjoining explorations licenses covering 3104 hectares. A review of the project by geological consultants has indicated that the deposit will require approximately 40 additional drill holes to validate the existing drill hole information and allow a JORC compliant resource to be calculated.

The company has an initial exploration target for the deposit of 40-60 Mt @ 1.2 to 1.4% nickel based on the grades, widths and extents of the existing drilling results described above.

The project is untested to the North and West and there is significant potential to expand the size of the deposit. In addition, a portion of the deposit has metallurgical characteristics potentially amenable to direct smelting and may be suitable for direct shipping to nickel smelters in Australia and Japan, the company said.

The drilling required to convert the existing mineralisation to a JORC compliant resource will commence as soon as shareholder approval is gained. (alex)