Marampa Iron Ore Project
The Marampa Iron Ore project (“Marampa Project”) comprises exploration licence EXPL09/06, located 150km northeast of Freetown, Sierra Leone, West Africa. The licence has an area of 319km2 and surrounds the Marampa mining lease, where from 1933 to 1975 the Development Corporation of Sierra Leone (“DELCO”) mined and exported approximately 60 Million tonnes of iron ore.
The Marampa Project has the advantage of being connected by an 84km railway to an existing deep water port, stockpiling and ship loading facility located at Pepel to the southwest.
Exploration by the Company has located several iron ore prospects on the licence. These represent extensions to, and outliers of the same geological formation hosting the red cap and specular hematite schist ore mined by DELCO. In addition, there is a significant quantity of iron ore tailings located on the licence left from the DELCO operations.
Scout exploration diamond drilling by the Company over a prominent gravity anomaly at Gafal West, which is the prospect located to the southwest of the old mine, has confirmed the occurrence of specular hematite schist mineralisation with iron grades ranging from 23 to 30% over broad intervals. This mineralisation is open to the south and west.
Ship loader at Pepel Port
Marampa Railway
Metallurgical test work on this diamond drill core during 2008 demonstrated that a saleable high-grade, low impurity concentrate can be produced using simple crushing, coarse grinding and gravity separation.
Ground gravity geophysical surveys and recent geological mapping have also indicated that the specular hematite schist formation extends approximately 10km north of the old mine and have confirmed another prospect located 7km to the south.
Project Investment
On 1 October 2008, the Company formalised an agreement with ASX listed Cape Lambert Iron Ore
Limited (“CLIO”) for a 30% investment in the Marampa Project. Under the terms of the agreement, CLIO paid a consideration of 44 Million fully paid ordinary shares, will fund US$25 Million towards a feasibility study and assumes management of the Marampa Project. On 22 January 2009 and subsequent to the close of the financial year, CLIO increased its investment in the Marampa Project to 35% with a further consideration of 17 Million fully paid ordinary shares.
The divestment of 35% of the Marampa Project to CLIO will enable the Company to focus on the
development of its world class Tonkolili iron ore project whilst retaining an interest in the Marampa
Project and exposure to exploration upside. CLIO is well placed to add value to, and advance, the
Marampa Project with proven management and technical credentials and a strong balance sheet.
2009 Work Programme
CLIO has initiated a comprehensive work programme at the Marampa Project, which is focused on:
- determining the viability of establishing a tailings retreatment operation,
- defining the resource potential of the hard rock extensions to the old DELCO mine and
- defining the resource potential of the regional prospects.
Drilling and bulk metallurgical sampling of the tailings during 2009 is designed to define a resource inventory and to develop a process flow sheet to underpin the establishment of a tailings retreatment operation, thereby establishing a cash flow and enabling early refurbishment of the existing rail and port infrastructure.
In parallel to the tailings assessment, drill testing of the prospects immediately west and north of the old DELCO mine will be undertaken with the objective of defining a JORC compliant Mineral Resource and to provide representative samples for flow sheet metallurgical test work. The outcome of these programmes will provide a basis for scoping the development of a hard rock mining operation, which would have synergies with the infrastructure established for tailings retreatment.
Trenching and scout drilling will be extended to cover the regional prospects to assess their resource potential.
Encouraging metallurgical test results were reported by CLIO during April 2009 for a bulk composite sample of historical hematite tailings from Marampa. A test regime comprising wet, high intensity magnetic separation for roughing and cleaning and reverse flotation cleaning of the middlings fraction produced a high-grade concentrate suitable for the manufacture of blast furnace feed pellets. The hematite concentrate produced from the tailings graded 65% iron and 3.9% silica for a mass and iron recovery of 46% and 91.6% respectively.
Air core drilling of the tailings commenced in late March 2009, and drill samples will be used to prepare a JORC compliant Mineral Resource estimate, and a representative bulk tailings sample for follow-up bench scale metallurgical test work.