THE BOURSE WHISPERER: Monax Mining has signed an option agreement over an iron sands project in Chile, South America.
Under the terms of the agreement, Monax will have 90 days to carry out due diligence on the Huentelauquen iron sand project.
Location of Huentelauquen iron sand project, Chile. Source: Company announcement
During this period, the company said it will complete a ground-penetrating radar survey to estimate the volume of sand within the leases.
It has also engaged project engineering firm, Sinclair Knight Mertz (SKM), to undertake a scoping study based on available information to assess the project economics and potential processing options.
“The Huentelauquen iron sand project is a significant new project for Monax, not only due to the potential of the actual venture, but also because it is located within a mining friendly jurisdiction in Chile,” Monax Mining managing director Gary Ferris said in the company’s announcement to the Australian Securities Exchange.
“Iron sand deposits have many advantages over traditional hard rock sources of magnetite including lower cost exploration, lower mining costs and lower processing costs.”
The four granted mining leases cover an area of 855 hectares and are located along the coast near the settlement of Huentelauquen, 35km north of Los Vilas, and about 200km north of Santiago.
The leases are located close to existing infrastructure including the sealed coastal highway and port facilities at Los Vilas.
Monax said proposed processing stages will be compared with those used in typical mineral sands industries and the appropriateness of those stages will also be examined.
“A conceptual flow sheet showing the major processing stages will be prepared, while mining and concentration methodologies will be studied at a high level to verify the appropriateness of the methodology considered in the reports,” Ferris said.
“Based on the geology, a suitable mining and concentration method will be examined.
“A high level cost estimate for the mining and concentration plant and beneficiation plant will also be prepared and compared with the proposed estimate.”