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INFLUENTIAL STRATEGIC PARTNER

A project ranked by authorities in the Northern Territory as the biggest rare earths deposit in Australia is to progress with a top Chinese mining house as a major corporate shareholder.

Author: Ross Louthean
Posted: Monday , 20 Apr 2009

PERTH -

Arafura Resources Ltd (ASX: ARU) today signed a formal agreement in Darwin today with Jiangsu Eastern China Non-Ferrous Metals Investment Holding Co. It was signed in front of the Northern Territory's Minister for Primary Industry, Fisheries & Resources, Kon Vatskalis.

This is a $A24 million ($US17.1 M) investment with the Chinese company which is a subsidiary of East China Exploration & Development Bureau (ECE), to give the backer a 25% stake in Arafura.

The deal accelerates the development timetable for Arafura's Nolans rare earths-phosphate-uranium project in the NT.

Arafura's managing director Alistair Stephens said ECE will be an "highly strategic and influential partner with renowned expertise in mineral exploration and development."

Nolans has a current resource of 30.3 million tonnes, containing 848,000 tonnes of rare earth oxides, 3.9 Mt of phosphate, and 13.3 M pounds of uranium.

Stephens said Nolans is capable of sustaining a mine life well in excess of 20 years.

In addition to completing a bankable feasibility for this project, Arafura has developed a processing flow sheet and has demonstrated the recovery of rare earths, phosphoric acid and uranium at a pilot plant located at ANSTO (Australian Nuclear Science and Technology Organisation) in Sydney.

"Arafura also has an exploration and development program to grow its position in rare earth projects with additional growth beyond the Nolans project," Stephens said.

Other Arafura-controlled tenements contain gold, nickel and vanadium mineralisation.

Arafura has operated in Australia's NT for the past 20 years has diversified its asset portfolio by targeting projects that will deliver long-term and sustainable value and growth.

ECE was formed in 1955 and is one of the few Chinese State-authorised organisations focused on engaging in mineral and energy exploration and is permitted to complete geological exploration and conduct scientific research in major State-classified projects.

ECE has discovered more than 160 ore deposits in China with a potential value in excess of $A10 billion ($US7.13 B).

ECE has several mines and refining operations including Youxi Jindong lead-zinc mine and refining operations, Fujian Taiyangshan gold mine, Yunan Boka gold mine, Anhui Matou copper-molybdenum mine and an iron mine in Brazil.