Dempsey says not to Cacule Option Agreement

THE BOURSE WHISPERER: Dempsey Minerals has elected not to exercise the Cacule Option Agreement following exploration and field reconnaissance failed to provide it with any satisfactory encouragement.

A small drilling program undertaken at the site provided sub-economic results.

The company spent approximately $150,000 to undertake works to satisfy requisite due diligence assessment to the company’s satisfaction over the Cacule manganese project.

In the meantime, Dempsey is earning into the Dandaragan phosphate project and the Cooljarloo mineral sands project, which it seems to me more upbeat about.

The Dandaragan phosphate (and glauconite) project is located approximately 150 kilometres north of Perth centred on the town of Dandaragan.

The project lies within the Northern Perth Basin which is more renowned as a major mineral sands mining province.

“The Dandaragan project hosts numerous phosphate occurrences occurring within Cretaceous sediments of the Dandaragan Trough,” Dempsey explained in its ASX announcement.

“The origin and style of this mineralisation is unlike other major rock phosphate projects in Australia, such as Phosphate Hill (Incitec Pivot) and Wonarah (Minemakers).

“Phosphate mineralisation at Dandaragan occurs as nodules and precipitates within sandy sedimentary host rocks similar to that observed in the giant phosphate deposits of Florida, USA.”

Dempsey has planned a first-pass aircore exploratory drilling program of 12 drill holes for 980 metres at Dandaragan for late 2011.

The completion of this program is pending Aboriginal Heritage Clearance which the company anticipates to be finalised in late-October, with drilling proposed to commence in November pending drill rig availability.

The Cooljarloo heavy mineral sands (HMS) project comprises an exploration licence also situated in the Northern Perth Basin.

The Cooljarloo project abuts Tiwest’s Cooljarloo mine and Image Resources’ Cooljarloo heavy mineral sands discoveries.

“The Northern Perth Basin hosts a series of strandlines between the coastline and the Gingin escarpment,” Dempsey explained in its announcement.

“HMS mineralisation occurs in three different depositional environments in the Cooljarloo area; Strandline mineralisation close to the surface, so called “mid-level” mineralisation and basement (Mesozoic) mineralisation.

“These strandlines host large concentrations of heavy mineral sands principally containing ilmenite, rutile and zircon.

“Tiwest’s Cooljarloo HMS mine has been operating since 1989 and Tiwest has reported production of more than 700,000 tonnes of heavy mineral concentrate a year using a dredging operation and dry mining techniques.

“The Cooljarloo project is situated in a particularly active area of mining and recent exploration activity for HMS but has yet to be adequately explored.”