Sri Lanka ilmenite deposit lures Australian mining firm
EconomyNext – Australia’s Iluka Resources Ltd. said it plans to start a scoping study of its mineral sands deposit in north-western Sri Lanka this year and also "engage" with the new government.
The company, one of the world’s biggest producers of minerals sands, said in a stock exchange filing it has "large, long life, scaleable sulphate ilmenite deposit" in Puttalam, Sri Lanka.
Its latest accounts showed it has spent 4.6 million US dollars in 2013 for the purchase of Sri Lanka deposits.
Iluka has acquired all of the share capital in PKD Resources (Pvt) Ltd, a Sri Lankan domiciled company which owns an exploration tenement located near Puttalam.
This included payment of 2.0 million dollars on the grant of a mining license over a deposit identified as EL 170 in Puttalam and payment of 8.0 million dollars on the Iluka Board approving a development on the deposit.
It also included the payment of an annual trailing payment calculated at one per cent of the gross sale proceeds received from the annual sale of all mineral products and sand clay produced from the tenement, less the two million paid on the grant of the mining license over EL 170, considered an advance payment.
Iluka re-entered Sri Lanka in 2013 a decade after exiting the island because of the ethnic war.
Iluka was previously involved in exploring Sri Lanka between 1997 and 2001.
he Perth-based company said at the time it relinquished its exploration leases in 2003 because the quality of the resource was poor and because of "accessibility" issues.