Quarterly Activities Report (4088L)
July 29 2011 - 10:29AM
UK Regulatory
TIDMLRL
RNS Number : 4088L
Leyshon Resources Limited
29 July 2011
29 July 2011
JUNE 2011 QUARTERLY REPORT
Leyshon Resources Limited (AIM/ASX: LRL) (Company) announces
that during the quarter it continued to review, and is continuing
to undertake due diligence on a number of project investment
opportunities, some of which have the potential to meet the
Company's investment criteria.
As previously advised, the Company has completed a preliminary
technical and legal due diligence review on a PRC entity that holds
an exploration licence over a thermal coal project in the Western
Chinese province of Xinjiang. More detailed review of the technical
data collated during the June quarter has confirmed that the asset
has the potential to meet the Company's investment criteria.
Also as previously advised the Company has commenced commercial
discussions with the vendor and these are continuing.
The Company's main focus during the quarter has been on
advancing the approvals necessary to facilitate the transaction.
The Company has an experienced team based in the Provincial capital
Urumqi whose task is to ensure the timely progression of each step
of the lengthy approvals process. The recent changes to the PRC
foreign ownership laws for the minerals and energy sector have been
a factor in slowing this progress.
In addition, the Company and its advisors have commenced
discussions and negotiations with a large state owned enterprise on
joint venture arrangements which, in the event of a successful
completion of the transaction, would become the Company's joint
venture partner on the project.
Whilst the Company believes that the asset is attractive in that
it has the potential to meet its demanding internal investment
criteria, it can give no assurance that these due diligence
investigations, approval processes and/or discussions will lead to
the successful completion of the transaction.
The Board is aware that this particular process is taking some
time to reach a conclusion. The Board notes that in the current
competitive environment the acquisition of high quality assets can
be expected to take time to complete.
The Company remains diligent in its assessment of project
investment opportunities at all times and is therefore prepared to
commit significant expenditure on due diligence and approvals and
other studies before committing to a transaction.
Whilst ensuring that adequate resources are applied at all times
in search of a positive outcome the Board is mindful of preserving
cash reserves. At quarter end the Company had A$52.9 million in
cash, and is due A$1.6 million in term deposit interest for a total
of A$54.5 million. This is equivalent to 22 A$ cents per share and
15 pence per share.
The Company continues to generate investment proposals including
a number of gold, copper and coal projects in China as well as from
many locations around the world and it actively considers each one
in light of its competitive advantage of being located in Beijing
and able to access the Chinese end user market.
For further information contact:
Leyshon Resources Limited
Paul Atherley - Managing Director
Tel: +86 137 1800 1914
patherley@leyshonresources.com
Seymour Pierce
Jonathan Wright/John Cowie (Nominated adviser)
Richard Redmayne/Leti McManus (Corporate broking)
Tel: +44 (0)207 107 8000
http://www.leyshonresources.com
Background
Leyshon was on the ground in 2003 when China opened its mining
sector to foreign investment. It has been fully engaged in China
since then and has its main operating office located in
Beijing.
China's latest Five Year Plan emphasizes Inclusive Growth which
entails the planned urbanization of a large number of Western
China's rural population into second and third tier cities. This
will result in significant increases in power consumption and
infrastructure spending.
The Company is planning to invest in high quality coal assets in
Xinjiang which will sell into the escalating demand for thermal and
metallurgical coal across China over the next ten years.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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