Korab Resources mulls offloading assets to focus on magnesite; shares gain 32pc
Korab Resources is looking at divesting its other projects to focus on its magnesite project in the Northern Territory.
The news sent Korab’s (ASX:KOR) shares up almost 32 per cent to an intraday high of 5.8c on Tuesday morning.
The stock — which was trading at 3.3c a week ago — cooled to 5.2c by the closing bell.
The decision to review its operations in Western Australia and Ukraine comes on the back of positive results from a recent feasibility study on the Winchester project.
Magnesite is traditionally used in magnesia cements, building materials, flame retardants and animal feeds and fertilisers.
But it is now attracting attention for its use in magnesium-ion batteries.
World production of magnesite is controlled by China but recent mine and plant closures there have been contributing to higher prices.
Korab is planning to develop Winchester into a Direct Shipping Ore project, which means it would require only a simple crushing and screening process before being exported.
An expanded study showed the project had “attractive economics” and the potential for pre-tax earnings of about $614 million over the life of the project.
Korab told investors the aim of the review is the potential divestment of its other projects and it is considering joint ventures and/or a partial or full sale.
The company has begun talks with interested parties.
Korab has been contacted for comment.