Strandline Resources - An Emerging Leader in Mineral Sands Production

Strandline Resources is an Australian mineral sands producer that is ramping up production at its flagship Coburn project in Western Australia. Led by an experienced management team, Strandline has successfully transitioned from exploration to production, establishing itself as a sustainable long-term business in critical minerals. With mineral sands demand projected to grow globally, Strandline represents an attractive investment opportunity.

Rapid Growth from Junior Explorer to Major Producer

In just a few short years, Strandline Resources has undergone tremendous growth, evolving from a small exploration company to a substantial producer. Since 2017, staff levels have expanded from just a handful to over 150 direct employees today. The company now operates the massive Coburn mineral sands project, which ranks among the largest in the world. Despite challenges like labor shortages, COVID-19 and cost inflation, Strandline delivered Coburn safely, on time and on budget. This demonstrates the capability of Strandline's people and culture.

labourThe Coburn project, 100% owned by Strandline Resources, is strategically located along the central west coast of Western Australia, approximately 250 km north of Geraldton port. With mineralization extending over 25 km, Coburn has total heavy mineral resources of 790Mt containing over 9Mt of heavy minerals. Mine life spans 22.5 years based on reserves alone, with an additional 15 years of production targets. The deposit has a low strip ratio, free-flowing sand and conventional dozer mining methods.

Funded for Success with $340M Construction Complete

Strandline Resources has invested $340M to construct Coburn, fully funding the project through a combination of debt and equity. This includes an A$130M loan facility from the Australian government's Northern Australia Infrastructure Facility. With construction now complete, Coburn is ramping up toward its initial production rate of 23.4Mt per annum, projected to generate $120M EBITDA annually. Positive cash flow has already been achieved in initial production.

Premium Product Assemblage Driving Strong Margins

Coburn produces some of the highest-value mineral sands globally, including premium zircon and chloride ilmenite. These minerals command prices significantly above Strandline's original assumptions, with current spot prices 30-40% higher. The high-quality product suite, which also includes rutile, is in strong demand across various end-use sectors from ceramics to pigments. This product advantage enables Coburn to generate outstanding margins.

Near-Term Growth through Coburn Expansion

With over 35 years of ore reserves defined and potential to expand resources along strike, Coburn offers substantial growth beyond its initial 23+ year mine life. Strandline is studying a low-cost expansion that could increase production by 50% through the addition of a second mining unit and associated infrastructure. The Coburn expansion is expected to yield extremely attractive returns on incremental capital invested. Definitive feasibility studies will be completed in 2022.

In addition to its Australian assets, Strandline Resources controls a strategic tenement portfolio covering Tanzania's mineral sands-rich coastline. This includes the Tajiri project, a potential multi-decade producer where Strandline has a joint venture agreement with the Tanzanian government. Tajiri is currently progressing toward receipt of a Special Mining License, considered nationally important due to its enormous scale. Strandline's portfolio also includes promising early-stage projects like Fungoni.

With construction completed and Coburn ramping up production, Strandline Resources is delivering on its vision to be a major, multi-decade producer of mineral sands. Its 100% owned world-class Coburn project and premium mineral assemblage position Strandline to capitalize on strong market demand trends in critical minerals. For investors, Strandline offers exposure to these attractive commodities through a profitable producer with significant growth potential.

The Investment Thesis for Strandline Resources

Profitable near-term production and cashflows - Coburn is now in production and generating positive cash flows, providing investors with near-term returns. As the ramp-up continues, cash flows are expected to grow significantly.

Attractive commodities with strong demand trends - Mineral sands like zircon and titanium dioxide have positive long-term demand fundamentals, driven by urbanization and growth in renewables/EVs. This supports commodity prices.

World-class scale and quality of Coburn asset - Coburn is one of the largest and highest-grade mineral sand projects globally. Its scale and high-value minerals underpin low costs and strong profit margins.

Significant mine life with expansion potential - Current 22.5 year mine life can be extended by 15+ years. A low-cost expansion could boost production by 50%, unlocking further value.

Experienced management team - Strandline's management has a proven track record of successfully developing and operating mining projects.

Strong government support - The Australian government has backed Strandline with $130M in debt funding for Coburn's development.

Attractive valuation and upside potential - Strandline's market valuation does not yet reflect Coburn's potential earnings and cash flows. As production ramps up, a significant share price upside is possible.

In summary, Strandline Resources offers investors exposure to high-quality mineral sand assets with a clear pathway to significant free cash flow generation. With production underway, strong management and government support, Strandline Resources is positioned to deliver excellent returns for shareholders.

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