VANCOUVER, BRITISH COLUMBIA, Jul 15 (MARKET WIRE) --
Sterling Group Ventures Inc. ("Sterling" or the "Company") (OTCBB:
SGGV)(FRANKFURT: GD7) has recently signed an agreement (the "Agreement")
with Zhong Chuan International Mining Holding Co., Ltd. ("Zhong Chuan")
of China to complete an equity financing, to accelerate the development
of the lithium and potash salt lake deposits in China and to restructure
the transactions contemplated under an earlier agreement (the "Initial
Agreement") entered into between Sterling (through its subsidiary) and
the Beijing Mianping Salt Lake Research Institute ("Mianping").
Zhong Chuan, a private company was founded by its current chairman, Mr.
Sun Ximing. It has eighteen domestic and overseas direct subsidiaries
exploring and developing precious, non ferrous and ferrous metals and
energy resources. Zhong Chuan is now a leading private Chinese mining
company expanding internationally.
Zhong Chuan has considerable experience and success in developing mines
in China. It owns 4 large mines and will work with Sterling to develop
lithium and potash projects in China. Under the terms of the Agreement,
Zhong Chuan will, through a related private Hong Kong company, Monte Sea
Holdings Ltd. ("Monte Sea"), acquire control of Sterling and focus on the
development of lithium and potash projects in China, including
Dangxiongcuo Salt Lake (the "Property" or the "DXC project") and other
salt lakes which have been acquired by Zhong Chuan. The Agreement
contemplates the following:
- Zhong Chuan will assume Mianping's rights and obligations under the
Initial Agreement;
- Upon the coming into effect of the Agreement and the termination of the
Initial Agreement, Zhong Chuan will cause Mianping to repay 6,000,000 RMB
to Sterling (by way of Sterling's wholly owned subsidiary);
- Zhong Chuan will cause an operating company to be established in China
which shall have a registered capital of 100,000,000 RMB. All interest in
the Property under the Initial Agreement will be transferred to the
operating company;
- The operating company will be converted into a joint venture company
("CJV") with Monte Sea acquiring up to a 65% interest in the CJV in
consideration of the registered capital;
- Monte Sea shareholders will subscribe for 5,000,000 units to be issued
by Sterling at $0.15 per unit. Each unit is comprised of one common share
and one two-year warrant to purchase another common share at $0.16 per
share. This subscription may be increased at the mutual discretion of
Sterling and Monte Sea;
- Monte Sea shareholder will be issued up to 287,910,000 common shares in
Sterling upon completion of certain milestones specified in the
Agreement, such that the CJV shall have exploration and mining licenses
permitting it to develop the Property. All such issuances shall be
subject to regulatory approvals where required.
As a result of the Agreement, Mr. Ximing Sun and Mr. Charles Yan or their
nominees have been invited to join the Board of Directors of Sterling.
Mr. Sun has received numerous awards in China, including being named one
of the Top 10 China Mining Leaders in 2007 and Excellent Entrepreneur in
China.
The Ministry of Land and Resources of the People's Republic of China has
certified the following audit and examination of mineral reserves
relating to the Dangxiongcuo Surface lithium brine - the DXC project:
Constituent Tonnes Grade, g/l
----------- ------ ----------
Lithium Chloride (LiCl) 858,800 2.43
Potash (KCl) 7,706,600 20.00
Boron Oxide (B2O3) 1,039,200 2.94
Bromine (Br) 95,300 0.27
Rubidium (Rb) 7,400 0.02
Current plans are to put the DXC project into production as soon as
possible initially by producing up to 5000 tonnes of lithium carbonate
and potash in stages. Interest to purchase in excess of all of Sterling's
planned production has been received. Our lithium carbonate is estimated
to be recoverable at less than US$800 per ton as compared with the
current commodity price of 60,000 RMB per ton or about US$8,000 per ton
(up recently from $5,500 per ton) with about 100,000 tonnes of potash
initially per year as a byproduct which will require further processing,
worth an estimated $66 million in additional revenue per year based on a
price of US$660 per ton that Chinese fertilizer importers signed in
April, 2008 with Canadian potash suppliers. Based on current prices and
the audit and examination of mineral reserves by the Ministry of Land and
Resources of China, the value of the lithium carbonate and potash that
could be recovered through evaporation, flotation and precipitation is
about US$12 billion.
It is the intention and priority of Sterling to procure expeditiously all
the required regulatory approvals in China with the help of Zhong Chuan
for the purpose of commencing development of the Property, and other
lithium and potash resources in China. "The transactions contemplated in
the Agreement will enable Zhong Chuan to expand internationally, and help
to accelerate the development of the Property by Sterling", commented Mr.
Raoul Tsakok, Chairman of Sterling.
ON BEHALF OF THE BOARD OF DIRECTORS
Richard Shao, PhD, President
CAUTION REGARDING FORWARD LOOKING STATEMENTS
Cautionary note to U.S. investors-The United States Securities and
Exchange Commission permits U.S. mining companies, in their filings with
the SEC, to disclose only those mineral deposits that a company can
economically and legally extract or produce. We use certain terms in this
press release based on audits conducted under Chinese methods of
calculation, which the SEC guidelines strictly prohibit U.S. registered
companies from including in their filings with the SEC. U.S. investors
are urged to consider closely the disclosure on our Form 10-KSB which may
be secured from us, or from the SEC website at
http://www.sec.gov/edgar.shtml.
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,
potash, 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 that the company may not be
able to raise the necessary capital, 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, lithium carbonate, potash, and other metals and chemicals, 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.
Security Code: A0B9TQ
Contacts:
Sterling Group Ventures Inc.
Richard Shao
President
(604) 893-8891
(604) 408-8515 (FAX)
Sterling Group Ventures Inc.
Christopher Tsakok, MBA
(604) 893-8891
(604) 408-8515 (FAX)
Website: www.sterlinggroupventures.com
Copyright 2008, Market Wire, All rights reserved.
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