Clive Palmer-controlled iron ore hopeful Australasian Resources’ shares have soared after the company announced a funding and development strategy for its Balmoral iron ore deposit in the Pilbara.
Australasian stocks gained 60 per cent by close of trade today, finishing at 26.5 cents, after the company confirmed it was in talks to raise around $1.1 billion to develop Balmoral.
Australasian said Mr Palmer had also received a letter of interest from the Royal Bank of Scotland, to sell $US500 million in high yield notes through its subsidiary, International Minerals.
The Queensland-based Mr Palmer owns a 64 per cent stake in Australasian.
Australasian also said it was also in talks with a “major trading house” for a $US600 million cash injection into the project.
The company said it had also agreed to an initial accord with Mineralogy, a private entity associated with Mr Palmer, to access two billion tonnes of iron ore from the mine.
Finally, China Metallurgical Group has agreed to raise 75 per cent of the project’s costs through an export credit from Chinese banks.
An evaluation of the project’s costs is underway.
“This is a major achievement for ARH at the right time, especially considering that the comparable Sino Iron project next door will begin to export product next year,” Australasian chief executive Dio Wang said.
