Sir Lunchalot – Emergent Resources
Nathan Lude chief executive officer of iron ore hopeful Emergent Resources recently popped into the Roadhouse to catch up with Sir Lunchalot over a steak sandwich.
Emergent Resources is a junior diversified explorer that listed on the stock exchange in August 2008.
The company is currently focused across, what it has identified to be the right commodities, namely iron ore, base metals and gold.
Emergent has a 561 million tonne iron ore magnetite deposit located at its Beyondie iron project, where it is also moving to establish a resource around a near surface hematite deposit.
The company is focused around building a pipeline of projects and recently made an announcement in relation to some gold that it had found on its Beyondie tenements.
“We have assessed the previous drilling and discovered significant widths and grades of gold so it is quite an exciting project but there is lots of work we have to do,” Lude explained.
“We have to get on the ground and further advance exploration across that.’
The ground comes with some history with previous operations having successfully developed resources of over 7 million ounces.
Emergent is of the opinion a continuation exists of the Plutonic Well Greenstone Belt that comes across its ground.
“We believe it continues so far that we have even secured ground with a joint venture party to the northeast of us”, Lude said.
“So there is a lot of smoke with this ground. A lot of exciting previous drill data. There is a lot of work that remains to be but we look done forward to getting on the ground.
“There is some continuing news flow that you will see over the coming months about this project. It’s very early days but it is quite exciting.”
Emergent also recently announced a growth strategy for 2011 that Lude said was really to provide a framework for shareholders and potential investors to show the direction the company is heading for this year and what it is set to achieve.
“We have a potential world-class iron ore deposit at Beyondie,” Lude explained.
“We have a strong board and management with significant ‘skin in the game’. I have over half a million dollars of my own money that I have invested onto the company.
“Another non-executive director has invested over $1.3M, and our chairman, Mr Wolfgang Fischer just purchased three million shares recently at an average cost of 26c.
“So there is a significant amount of our own money on the company and we haven’t allocated ourselves any shares.’
The Beyondie iron project, located 160km south of Newman, is Emergent’s flagship project. Further south are the company’s Glengarry projects, comprising Diamond Well, Mt Bartle and North Pool, which are prospective for base metals and gold.
The immediate focus for Emergent is doubling its magnetite resource at Beyondie from 561 million tonnes to up over the 1 billion tonnes mark.
“We undertook a preliminary scoping study early last year and we have identified this 1 billion tonne mark as creating the situation where the project is significantly viable,” Lude said.
“We are also eager to develop a resource around the near-surface hematite, which is focused around our short-term, early positive cash flows.”
The company is also keen on advancing and consummating joint venture partnerships due to the high capital and operating expense associated with a magnetite mining operation.
“We’re looking at bringing in a joint venture party,” Lude continued.
“We are currently in discussions with a number of parties and I would like to see us consummate one aspect within the coming months.
“Certainly we are in discussion with a number of parties across our projects.”
One major facet to the Beyondie project is that it is an established resource at 27.5% iron. After beneficiation the iron content is up over 70% with very low impurities and the company has made a statement to the market that it is advancing DTRs and developing a 3D concentrate model.
“We’re further taking the necessary steps to take us through to our Bankable Feasibility Study,” Lude said.
“The upside that is left in the resource is quite significant. We have an exploration target of 3.7 to 4.2 billion tonnes, so it is quite a significant scale of operation that we can create there.
“The main facet that has me very interested in this project, and the considerable upside that I see in this project, is because of the scalability.”
This area where Emergent has the established resource is just over 5km. This, combined with the area where it expects to establish an extra half a billion tonnes this year comes to just over 11km.
The total length of the company’s deposit at Beyondie is over 60km.
This area containing the current resource and the immediate target has been granted since Emergent listed. The rest has been in application.
“Late last year we advanced exploration across this area where we noticed a 21 kilometre outcrop of hematite that sits in that region,” Lude said.
“We have rock chip sampled that and they have come back showing from 55 to 64 percent with an average grade of 57 percent.
“We have initiated one drill program there and there is a lot of drilling that remains to be done but we are certainly moving towards developing a resource around that hematite outcrop.”