Muscat - Tri-Star Resources, a Londonbased integrated antimony development company, announced last week that it has entered into a non-binding memorandum of understanding (MoU) with Oman Investment Fund (OIF), and Castell Investments Ltd, whose parent company is Dubai Transport Co, to establish a joint venture (JV) to construct and operate an antimony roasting facility in Oman.
The JV company, to be called Strategic & Precious Metals Processing LLC (SPMP), will be incorporated in Freezone Sohar to undertake the roaster project, Tri-Star Resources said in a press release on its website.
The roaster, a 20,000 tonnes per annum nameplate capacity antimony metal and tri-oxide manufacturing facility, is estimated to cost US$60mn. SPMP is expected to enter into a land lease over a 22-hectare plot in Freezone Sohar.
The JV parties - Tri-Star, OIF and Castell - are working towards the preparation of final agreements, which are expected to be completed in November. Under the MoU, Tri-Star Resources will own and control 40 per cent of SPMP, with 40 per cent held by OIF and 20 per cent by Castell.
The funding structure for the total capital cost of US$60mn is expected to include US$30mn of project finance to be raised from local and regional banks.
The balance of the capital cost of US$30mn is expected to include a mezzanine loan of US$10mn from OIF with the balance of US$20mn to be provided as equity by the JV parties, pro rata to their ownership interests, over the construction phase of the project.
Tri-Star said that the project has received a preliminary green light statement from the sultanate's Ministry of Environment and Climate Affairs (MECA), confirming that it has no objection to the company proceeding with the environmental permit procedure for the antimony processing facility.
A full environmental impact assessment is now being prepared by JV parties for the roaster and is expected to be completed and submitted to MECA by the end of December.
The JV parties are progressing towards completing the final documentation, approvals and financing package so that site preparation work and construction can commence in the first quarter of 2014.
The roaster construction is expected to take 12 months, with a further three months for commissioning. The first full year of operation is expected to be 2016, the release added.
The roaster is the first phase of the Tri-Star's proposed metalprocessing activities.
The JV parties anticipate the extension of their partnership to a second phase processing facility, which envisages using Tri-Star's cleanroasting technology to treat refractory gold-sulphide concentrates.
The phase two project also expected to be located in Freezone Sohar.
Commenting on the signing of the MoU, Emin Eyi, managing director of Tri-Star, said, "We are impressed with the progress made by Freezone Sohar in becoming a metals and minerals processing hub in the Middle East. Our proposed projects are well suited to the future strategy of Freezone Sohar. Once fully operational they will be significant contributors to local employment and the economic development of the metals processing sector in Oman."
© Muscat Daily 2013
