Royal takes Red Dragon beyond 3 billion tonnes

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THE DRILL SERGEANT: Royal Resources (ASX: ROY) has announced an upgrade of JORC-compliant Inferred Resource at the Ironback Hill prospect, located in the southern portion of the company’s 100 per cent-owned Red Dragon Venture magnetite deposit.

The Inferred Resource at Ironback Hill has increased to 1,187 million tonnes at 23.2 per cent iron.

A previous resource estimate for Ironback Hill was announced in May 2012 at 677 million tonnes at 23.6 per cent iron.

This resource update represents a 39 per cent increase.

Royal indicated the Ironback Hill prospect to be approximately 10km in strike length and expects it would most likely be developed independently to the nearby Razorback Premium iron project.

 

Red Dragon Venture and prospect locations. Source: Company announcement

 

The Ironback Hill resource also contains a higher grade Inferred Resource of 310 million tonnes at 30.4 per cent iron using a 26 per cent cut-off grade.

“This is the final increase in resources for the foreseeable future,” Royal Resources managing director Marcus Flis said in the company’s announcement to the Australian Securities Exchange.

“With two areas now exceeding one billion tonnes each, Royal has sufficient resources to pursue two independent projects.

“Our flagship project, the Razorback Premium iron project, is currently the subject of an almost completed pre-Feasibility Study.

“The Ironback project will add depth and optionality to Royal’s holdings in the area.”

Royal said it has now completed this phase of resource estimation for both the Ironback Hill and Razorback Premium iron projects and that its focus now will be on completing a pre-Feasibility Study for the Razorback Premium iron project.

The company’s total Mineral Resources inventory now stands at 3.003 million tonnes at 21.8 per cent iron, which it claims positions the Red Dragon Venture as the largest magnetite resource in South Australia and second largest in Australia.

The company indicated the Mineral Resource estimate does not use an iron grade cut-off, as the mineralised zones are stratigraphically confined.

Application of an iron grade cut-off of 26 per cent iron produces a global higher grade Mineral Resource of 618 million tonnes at 30.2 per cent iron.