Second iron ore resource for Centrex Metals

THE BOURSE WHISPERER: The strategic partnerships of iron ore developer Centrex Metals with Top 10 China-based steel mills to explore for and develop iron projects on South Australia’s Eyre Peninsula continues to deliver good news with the announcement of a second major resource milestone in under a month.

Centrex has announced that Eyre Iron, its 40:60 joint venture with Chinese steel major Wuhan Iron & Steel Group Co. (WISCO), has confirmed a maiden JORC-Inferred resource of 159 million tonnes at the coastal Carrow prospect northeast of Tumby Bay.

Mineralisation at Carrow has returned magnetite concentrate grades of 66.9% iron with the resource estimate prepared from along a 3.4 kilometre strike length and to a depth of 50 metres below surface.

Eyre Iron, which has five iron prospective tenements on southern Eyre Peninsula between Dutton Bay and Port Lincoln, has been highly active in the area since late last year undertaking an extensive drilling program.
 
The Carrow estimate is the first Centrex-WISCO resource for any of that JV’s tenements.

The news follows a maiden Inferred iron resource estimate of 103Mt grading at 68.5% iron that was announced early in May for the Bungalow deposit.

Bungalow is north of Carrow in the Cowell area and is a Centrex JV with China’s Baotou Iron and Steel Group (Baogang).

Both the WISCO and Baogang JVs are magnetite pursuits and both Chines parties have equity and off-take stakes in Centrex.

“Carrow is just 25 kilometres from the proposed Centrex-WISCO development of a deepwater bulk commodities port at Sheep Hill,” Centrex Metals managing director Jim White said in the company announcement.

“The proposed port is to be a separate JV. The close proximity of the Carrow deposit to the proposed export hub and its favourable coarse grind size are behind the decision to continue the Prefeasibility Study (“PFS”) for the project.

“We are now on track to complete that PFS this year, with environmental and social baseline studies recently completed and process test work, plant and infrastructure designs now being finalised.”

The PFS is based on a 3 million tonne per annum magnetite concentrate circuit.

White said all final options for the processing operation at Carrow are due for completion in September but any decision to proceed, expected late this year, would only be made after completion of the PFS and comparison with other opportunities within the Eyre Iron JV tenements.

Eyre Iron has had six drilling rigs on site undertaking resource definition drilling over five additional targets. The JV has already completed more than 46,000m of mainly diamond drilling across Carrow, Greenpatch, Koppio, Iron Mount and Oolanta prospects with further results announcements expected later this year.

Eyre Iron has also completed a large-scale high resolution airborne magnetic survey over its White Flat, Charlton Gully and Warunda targets on Eyre Peninsula with associated follow up exploration drilling to be undertaken over coming months.

At the Bungalow project in JV with Baogang, the partners have announced a revised higher exploration target of between 530-750 million tonnes, with remaining areas of the deposit currently being drilled as part of a 30,000m Stage 2 program aimed at establishing additional iron ore resources over the Central and Northern Bungalow areas.

The Bungalow project is expected to move to PFS later in the year.