28 February 2012

Tri-Star Resources plc

("Tri-Star" or the "Company")

UAE Antimony Roaster

Independent Preliminary Engineering Report & Cost Benefit Analysis

Tri-Star Resources (AIM: TSTR), the antimony exploration and development company, is pleased to announce that is has received an independent preliminary engineering report and cost benefit analysis in respect of its proposed antimony roaster in the Emirate of Ras Al Khaimah ("RAK") in the UAE.

Highlights

•          Capital costs for the construction of 20,000tpa capacity roaster are estimated at U$60 million

•          Project sensitivity undertaken by GBM demonstrate that the proposed project is "highly viable"

•          Recommendation to proceed to a Bankable Feasibility Study

Introduction

As previously announced on 26 July 2011, Tri-Star Union FZ LLC ("Tri-Star Union"), the joint venture between Tri-Star and Union International Holdings Group, proposes to develop a 20,000 tonne per annum antimony metal and tri-oxide finished products facility, located in the Al Ghail Industrial Zone in RAK, which is owned and operated by the Ras Al Khaimah Investment Authority ("RAK-IA"), the sovereign investment company of RAK.  On 17 October 2011, the Company announced that it had received preliminary environmental clearance for the project. 

As part of Tri-Star's ongoing work in respect of this proposed project, GBM Mineral Engineering Consultants Limited ("GBM"), an independent consultancy firm based in Twickenham, London, have been commissioned to deliver a preliminary engineering report and cost benefit analysis ("GBM Report") for the 20,000tpa antimony products facility, the conclusions of which are outlined below.

Additional information concerning this project, including a summary copy of the GBM Report, will be made available in due course on the Company's web site at www.tri-starresources.com.

Commenting on the project, Emin Eyi, Managing Director of Tri-Star, said: 

"Should the Company source the necessary capital and proceed with the construction of the UAE based roaster, it will represent an important piece of infrastructure for the world antimony industry.  This modern facility, currently designed to handle a mix of feeds efficiently and in an environmentally compliant way, will provide an alternative to concentrate suppliers presently shipping their material to China. At full capacity, the plant could provide up to 12% of the world's demand for antimony products and is strategically located so as to serve both European and Asian consumers, with the GBM Report now demonstrating the project's robust economic characteristics.

"China has dominated the antimony industry for over a century, having controlled the majority of its processing capability in the past 40 years, but we are confident that should we proceed with the UAE roaster, Tri-Star will be able to begin addressing this dominance. I look forward to providing further updates on this exciting project in course."

Cost estimates

The GBM Report estimates that the total capital expenditure requirement for the proposed plant to be up to approximately U$60 million, comprised of U$36 million for direct capital costs, U$15 million of indirect costs and U$9 million of working capital for the plant.

The facility is designed to produce both antimony ingots and powdered antimony trioxide at high purity for sale to end users. The feedstock is designed around antimony sulphide concentrates supplied from either Tri-Star owned deposits or from purchases of third-party concentrates from various international sources.

Working capital estimates for the project have been estimated by GBM to be U$63 million on a "base case" scenario, assuming all feedstock is sourced and paid for from third-party sources.

If constructed, the proposed facility would be one of the first sizeable Western World antimony roasters designed to be fully compliant with modern environmental legislation, high recoveries and relatively low energy input costs.  Antimony metal and its products have been identified by independent sources as being of 'critical' importance to European industrial production.

The largest operating cost item is expected to be the transportation costs of delivering feed concentrate to the facility and then exporting the finished products to European ports. Based on current specifications, the plant is expected to employ approximately 70 full time personnel.

The project is to be located on a 20 hectare serviced site in the Al Ghail Industrial Park and Tri-Star Union has now secured gas allocation from RAK Gas, the park's natural gas provider. As designed, there remains scope on site to expand the facility and incorporate additional value added by additional product capture equipment in the future, such as a Merrill Crowe and CIL plant, to handle antimony concentrates that often carry precious metal credits. These value added units are not included in the capital or operating cost benefit analysis conducted at this stage by GBM in the GBM report.

Cost benefit analysis

GBM have conducted a cost benefit analysis of the roaster economics and concluded that the project was "highly viable" under the limits of the model used and recommended that the project be taken to the next stage of development in the form of a Bankable Feasibility Study ("BFS").

Under the base case assumptions detailed in the GBM Report, it is estimated that the project could return an internal rate of return of up to 41%, a Net Present Value of up to U$241.5 million and full year EBITDA of up to U$59.6 million, based on steady state production estimates. Although these estimates are illustrative at this preliminary stage, sensitivity analysis was undertaken by GBM to demonstrate that the project could be "financially viable even with major changes in the inputs" and this will be further explored during the BFS stage of the project's development.

Marketing team

Tri-Star not only intends to supply antimony concentrate from the Company's own operations to the roaster, but will also seek to acquire certain types of concentrates from additional third parties at international market terms and conditions.

In order to secure relationships with concentrate suppliers and to access finished product consumers, the Company is currently in the process of assembling an internal marketing team, headed by Vehbi Eyi, a long established antimony and minor metals trader.

Funding requirements

As previously disclosed, the successful development of the proposed project is clearly dependent on the availability of sufficient funding and the Company's ability to raise such funds when needed.  Accordingly, the Company is in the process of exploring a variety of funding initiatives for the proposed roaster project, as well as Tri-Star's other up-stream mining assets in Turkey and Canada, including equity, project finance, off-take linked funding, Government related funding and project equity stakes.  The Company expects to develop and clarify its funding strategy during the remainder of 2012 and will provide further updates as appropriate.  Initially, the Company will be taking the project to the next stage of development, being a BFS.

Enquiries:

Brian Spratley, the Company's Technical Director, has relevant experience within the sector and meets the criteria of a qualified person under the AIM note for mining, oil and gas companies and has reviewed and approved the technical information contained in this announcement.

14 February 2012

Tri-Star Resources plc

("Tri-Star" or the "Company")

Summary drilling report for the Göynük Project, Turkey

Tri-Star Resources (AIM: TSTR), the antimony exploration and development company, is pleased to provide an update to its 2011/2012 drilling programme on its Göynük Project, Turkey, which has recently been completed.

Highlights

·      A new area discovered by late stage holes with significant mineralisation including hole GOY 11065 which returned an intercept of 7.10% antimony over 4.70m

·      Behre Dolbear appointed to independently assess the current resource estimates by the end of Q1 2012

·      Drilling and modelling have demonstrated the mineralisation trend observed over approximately 300m across the project site is associated with a regional fault structure that extends across the prospecting licence for about 4km

·      The mineralisation is open east and west from the areas drilled to date

·      Metallurgical testwork results received from Wardell Armstrong give recoveries of 93% into concentrates of 61% Sb using both gravity and froth flotation methods

Emin Eyi, Managing Director of Tri-Star, commented: 

"The antimony mineralization at Göynük, associated with the major east-west fault, provides a significant target strike length for further drilling in 2012.  We look forward to receiving the independent assessment on the current resource estimates, and updating the market on our progress at Goynuk."

Additional information concerning this press release has been made available on the Company's web site at www.tri-starresources.com

Summary

The 2011 Göynük exploration and drill programme verified the existence of a mineralised zone to the south-west of the old mine workings and also discovered a new extension to the north-west. The new discovery was made with the last hole planned to be drilled, resulting in the programme being extended over the Christmas period into the New Year.

The computer modelling now indicates that the antimony mineralisation occurs mainly on sub horizontal boundaries between the major geological formations of the Murat Dagi melange.  The mineralisation trends east-west, and is associated with a main fault that separates the melange from sediments to the north.  This mineralised trend includes the mineralised area previously discovered in 2010, the newly discovered area and the area between hosting the old mine workings.

The internal estimates of mineralisation, drill logs, assays and other relevant technical data made or compiled by the technical team are to be submitted to Behre Dolbear Group Inc. ("Behre Dolbear"), a mineral industry advisory firm, who have been commissioned to produce an independent resource report.

The drill programme was planned to identify the limits of the mineralised zone to the south west of the old mine workings ("Area A") and to drill off the area around the workings to the west ("Area B"), in order to support a potential open pit.  The programme was to further test the old mine dumps and extend the mineralisation where possible.

The area around the existing mine and the prospecting licence area was surface mapped during the spring of 2010, which resulted in a mapping database and new maps being produced, improving the understanding of relationships between the units of the Murat Dagi melange, where the mineralisation occurs. 

Due to the complexity of the geometry of the mineralisation, the drilling was undertaken with one drill so that sufficient control could be exercised.  The programme commenced with Hole 21, which was drilled to check the sediment package to the north of the main fault, which proved to be barren in line with expectations.

25 holes (22 to 47) were drilled to outline and evaluate the mineralisation in Area A, to the south east of the mine; however, the use of a single drill extended the programme well into the autumn.  Once the original 26 hole drill programme had been completed, and while assay results were been awaited, the drill was moved to the west to and then to the north west in order to explore Area B, close to the old workings.  As the old workings are randomly oriented, it was decided to drill around the workings to establish samples to assess the remaining resource.

Mineralisation was encountered to the west, south and underneath the old workings and, accordingly, the Company decided to drill further out to the west.  Drill hole 59 intersected significant mineralisation almost 60 metres away from the old workings.  The drill programme was therefore further extended to drill an additional 8 holes (60 to 67). These holes were completed in early January 2012 and the cores logged and samples sent for assay. Mineralisation was visible in almost all of these additional holes.  Key results from these holes are shown in the following summary, full results are appended.

The Company intends to undertake further step out drilling of the mineralised areas once it is in receipt of new drilling permits

Behre Dolbear was engaged in December 2011 to provide an independent assessment of the Göynük resource.  This work is currently being undertaken and it is expected to be completed and made available by the end of Q1 2012,

Drilling Statistics

Sample Statistics

Mineral processing and metallurgical testing

The mineralised rock from Göynük was tested at Wardell Armstrong and the report stated the following: "The testing showed that, using a combined process, up to 92.9% of the antimony present in the feed could be recovered to a concentrate grading 61.1% Sb, with 69.5% of the antimony recovered from the initial gravity separation and the remaining 23.4% recovered by froth flotation."

Samples of the concentrates produced during the tests have been submitted to Hazen Research in Denver for roasting testwork.

Future

The mineralisation associated with the regional east-west trending fault provides a shallow target zone of significant strike extent. The Company plans to investigate this extension with a drilling programme later this year.

Enquiries:

Brian Spratley, the Company's Technical Director, has relevant experience within the sector and meets the criteria of a qualified person under the AIM note for mining, oil and gas companies and has reviewed and approved the technical information contained in this announcement.

Full Drill Results from Boreholes GOY11059 to GOY 11066 (GOY11067 not yet sampled)

Notes:

·      The data above is as received and selected for its significance, no corrections have been made.

·      The borehole intercept lengths have not been corrected for dip of the borehole or the dip of the mineralisation.

·      The borehole numbering convention is as follows, GOY for Göynük, 11 for 2011, and the borehole unique number.

·      The contractor is using HQ drilling equipment which results in approximately 72mm diameter core, with recovery being very satisfactory.  The recovered core is photographed and logged on site and selected core samples are cut in half and sent for assay. The residual half core is retained at site.

·      The samples are taken to the ALSGlobal laboratories in Izmir, on the west coast of Turkey, where they are crushed, pulverised and prepared for assay, and are subsequently delivered to the ALSGlobal laboratories in Vancouver for assay.