First Feedstock Arrives at Korean Recycling Plant (4255W)

TIDMZOX

RNS Number : 4255W

ZincOx Resources PLC

31 January 2012

31 January 2012

ZincOx Resources plc

("ZincOx" or the "Company")

First Feedstock Arrives at Korean Recycling Plant

ZincOx Resources plc (symbol "ZOX") is pleased to announce the first delivery of feedstock, Electric Arc Furnace Dust ("EAFD"), at its wholly owned recycling plant in South Korea.

The arrival of the EAFD will enable the plant to undergo commissioning with actual feed material - so called "Live Commissioning". The Live Commissioning marks the final stage in the development of the plant and is expected to take about four to six weeks from today. Production will commence immediately thereafter which is in line with the first quarter schedule previously announced. Pictures of the unloading of the first trucks are available on ZincOx's website (www.zincox.com) using the following link: http://zincox.lucidwebs.co.uk/recycling/photo-gallery.asp.

The hot briquetting plant and Rotary Hearth Furnace will be mechanically commissioned over the coming weeks. All other parts of the plant have already been mechanically tested. The development of the plant is 95 per cent complete and the project remains on budget.

Commenting on the announcement, Andrew Woollett ZincOx's Chairman said "We are delighted with the progress of this project, remaining, as it does, on schedule and within the budget we set when we started the development 16 months ago, and we look forward to our first production before the end of this quarter"

The Korean Recycling Plant ("KRP"), is being developed in two equal phases. Phase 1, referred to above, is designed to treat 200,000 tonnes per year of EAFD, a waste generated by the recycling of steel scrap, and to produce 49,000 tonnes per year of zinc in a concentrate. Korea has a thriving scrap steel recycling industry that generates furnace dusts which, due to the galvanised nature of scrap, contains high concentrations of zinc (18 to 28 per cent). All the major Korean scrap steel recycling companies have entered into ten year EAFD supply agreements with ZincOx. KRP's zinc bearing concentrate is suitable as a feed for zinc smelters, and for Phase 1 it is being sold under a long term contract to Korea Zinc, one of the world's largest zinc metal producers. The non-zinc residue from processing EAFD is made into an intermediate iron bearing product that can be sold to scrap steel recycling companies. Importantly, the process generates no waste.

Phase 1 of the KRP development is being developed at a capital cost of US$110 million and is expected to generate, at a zinc price of US$2,250 per tonne, about US$31 million in EBITDA per year. Once Phase 1 has reached full capacity, it is planned that development of Phase 2 will be commenced and this is expected to be in production in H2 2013.

For further information please contact:

 
 ZincOx Resources plc               Tel: [phone] 
                                     450 100 
 
 Peel Hunt LLP (Nominated Adviser   Tel: +44 (0)20 
  and Joint Broker)                  7418 8900 
 Richard Kauffer 
  Daniel Harris 
 finnCap Limited (Joint Broker)     Tel: +44 (0)20 
  Matthew Robinson                   7220 0500 
  Joanna Weaving 
 Tavistock Communications           Tel: +44 (0)20 
                                     7920 3150 
 Lydia Eades 
  Simon Hudson 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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