Failed zinc miner Strategic Resource Acquisition (SRA) (SRZ.H-V) has emerged from bankruptcy protection and has signed a deal to acquire some gold and base metals projects in Portugal.
SRA plans to acquire projects from another company familiar with the Companies’ Creditors Arrangement Act, Redcorp Ventures, which attempted to put the Tulsequah polymetallic project in northwestern BC into production. Redcorp is now in receivership.
SRA president Victor Wyprysky and Redcorp’s former president Terence Chandler considered merging their companies back in 2007 when times were good. However, restrictions on debts that both companies carried prevented that from happening.
When Redcorp went under, Chandler started consulting for SRA as Wyprysky was preparing for a come back. Chandler was recently appointed as executive vice president for SRA.
SRA invested about $150 million to revive the Mid-Tennessee zinc mine complex about 50 km west of Nashville, Tenn., but wasn’t able to run the mine profitably due to operational problems, poor metals prices and the world credit crisis. The stock peaked around $6.70 apiece in mid-2007 before falling so low it was delisted from the TSX. SRA then applied to be on the TSX Venture Exchanges NEX board until it could turn things around.
SRA is starting that turn around in Portugal, with the Lagoa Salgada polymetallic massive sulphide project located at the northwest extension of the Iberian Pyrite belt. The project has an inferred resource totaling 2.02 million tonnes grading 0.35% copper, 4.83% lead, 5.13% zinc, 1.29 grams gold per tonne and 85.35 grams silver.
The company is also acquiring the Vila de Rei gold project in central Portugal where gold mineralization occurs in persistent quartz vein systems up to 15 metres in width and in breccia zones associated with late granitic intrusives.
The price tag on the projects hasn’t yet been announced but Chandler says that SRA is getting a “reasonable price.”
“We can continue looking at acquiring other projects,” Chandler says. “We don’t intend to stop in Portugal.”
He said there were some discussions of picking up the Tulsequah project but it was decided the project is too advanced.
“It’s out of our reach,” Chandler says.
The deal is subject to regulatory approval and the company will need to do a financing to complete the purchase.
SRA shares were trading up half a cent to 1.5¢ apiece on the TSX today on a trading volume of 2.9 million shares. The company has 39.1 million net shares outstanding and a 52-week trading range between half a cent and 4.5¢.
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