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Sterling Receives an Off-take Commitment for 3,500 Tonnes of Lithium Carbonate (December 21, 2005)
Sterling
Group is pleased to announce that an off-take supply
commitment has been received from a consortium of international lithium carbonate users outside of China. According to the commitment, 3,500 metric tons per year of lithium carbonate or equivalent will be purchased at a price which must be mutually acceptable to be negotiated by April 1, 2006 unless extended. The consortium is also willing to consider purchasing larger quantities from Sterling Group if available under terms to be negotiated. Lithium carbonate is believed to be currently in short supply and unless supply is secured, downstream lithium plants are unable to expand or meet their current commitments if they don't have enough supply.
On
September 16, 2005, Sterling Group, through its wholly owned subsidiary, Micro Express Holdings Inc. ("Micro"), signed an Agreement (the "Mianping Agreement") with Beijing Mianping Salt Lake Research Institute ("Mianping") for the development of Dangxiongcuo salt lake property ("DXC Salt Lake") in Nima county of Naqu district in Tibet, China. The Mianping Agreement follows a Letter of Intent signed between the parties on July 11, 2005.
Pursuant to the Mianping
Agreement, the parties have agreed to set up a Cooperative Company, Tibet Saline Lake Mining High-Science & Technology Co. Ltd. (the "Cooperative JV") to develop DXC Salt Lake. The objective of the Cooperative JV is to use the funds provided by Sterling Group through Micro and the skills and technology provided by Mianping to produce lithium carbonate (Li2CO3) and borate from brine. Micro is to own 65% and Mianping 35% of the Cooperative JV, which is in the process of being approved.
It is anticipated that the total investment
in the Cooperative JV will be approximately 240 million RMB Yuan (or approximately US$30 million) and will result in production of 5,000 tonnes per year of lithium carbonate and other by products. Current market price of lithium carbonate in China is about 45,000 RMB Yuan per tonne (or approximately US $5,548 per tonne). Mianping guarantees the production cost of lithium carbonate will be less than 11,000 RMB yuan per tonne (or approximately US $1,356 per tonne). Above off-take agreement is for at least 70% of total production of DXC Salt Lake project.
A comprehensive engineering study for DXC Salt Lake project is also under way by China
Changsha Design and Research Institute of Chemical Industry Ministry, a Chinese Class A Design Institute in Changsha City of Hunan Province of China. The Company also commissioned Geothermal Brigade of Tibet Geology and Exploration Bureau for the topography measurement and engineering geology.
Lithium carbonate is the
starting point in the manufacturing of lithium and various lithium chemicals which are used in batteries, ceramics and glass, in primary aluminum production, in the manufacture of lubricants and greases, drugs and others. Lithium is the lightest of all metals with good conductivities of heat and electricity which have lent itself to a variety of increasing applications such as lithium-ion batteries in cars, cell phones, laptop computers etc. According to Mineral Information Institute (MII), most lithium is recovered from brine, or water with a concentration of lithium carbonate. Brines trapped in the Earth's crust (called subsurface brines) are the major source material for lithium carbonate. These sources which are recovered generally through solar evaporation are less expensive to recover than to mine from rock such as spodumene, petalite, and other lithium-bearing minerals.
For further information about the Mianping Agreement, please check our SEC 8-K filing.
ON BEHALF OF THE BOARD OF DIRECTORS
"Signed"
Richard Shao, President
For further information, please contact:
Richard Shao, President or Christopher Tsakok, MBA
Phone: (604) 893-8891 Fax: (604) 408-8515
The company website: www.sterlinggroupventures.com
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Safe Harbor Statement under the United States Private Securities
Litigation Reform Act of 1995: Except for the statements of historical fact contained herein, the information constitutes "forward-looking statements" within the meaning of the Private Securities Litigation reform Act of 1995. Such forward looking statements, including but not limited to those with respect to the price of lithium, lithium carbonate, other metals and chemicals, the timing and amount of estimated production, costs of production, reserve determination and reserve conversion rates, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Such factors include, among others, risks relating to the integration of the acquisition, risks relating to international operations, risks relating to joint venture operations, the actual results of current exploration activities, the actual results of current reclamation activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of lithium, beryllium, niobium, tantalum, and other metals, as well as those factors affecting the mineral industry. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Cautionary
Note to U. S. Investors Concerning Estimates of Measure, Indicated, and Inferred Resources and Reserves. Statements regarding reserves have been based on audits conducted under Chinese methods of calculation.
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