Emerging iron ore producer Shree Minerals' (ASX: SHH) cornerstone investor China Alliance International Holdings Group Limited acquired two million shares at $0.20 on 14 July through conversion of options.
China Alliance has exercised the options for a consideration of A$400,000 and has increased its stake in Shree to 18.93% from 18.303%, and now holds 18 million shares in the company.
Shree Minerals' in fill resource delineation drilling recently extended the presence of goethitic-hematite mineralisation at its Nelson Bay River Iron Project in North West Tasmania, providing impetus to earn early cash flows from Direct Shipping Ore in 2011/12.
Worth over $200 million at current market rates for iron ore, mining of DSO material by Shree Minerals will generate strong near term cash flows and transform the company from explorer to profitable producer.
Mining of DSO material is likely to have a CAPEX cost only around $4 million and using contractor mobile mining and crushing would only take between three to four months to set-up.
At current Lump and Fines prices, the DSO output from Nelson Bay is expected to generate $15-20 million in annual cash flows for Shree Minerals.
Originally published at: http://www.proactiveinvestors.com.au/companies/news/17952/shree-minerals-china-alliance-international-holdings-tops-up-shareholding-17952.html
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