Scoping Study confirms the economical potential
Surefire Resources NL has completed a Scoping Study (ASX:SRN 13 May 2021) for the Perenjori Iron Project. The study confirms the economic potential of this project, giving the Board comfort to progress the project. The study was undertaken by MinRizon Projects Pty Ltd whose principals have been pivotal to the design and construction of other magnetite beneficiation plants in Australia.
The Scoping Study is based on an Inferred Mineral Resource of 191.7Mt @ 36.6% Fe (JORC 2004) estimated by internationally recognised consultants CSA Global. The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resources, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply, and have not materially changed. The company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.
Scoping Study Considerations
The Scoping Study was based on metallurgical work supervised by Mintrex Pty Ltd. Additional test work will be undertaken during the Prefeasibility Study stage to confirm their conclusions.
The study examined using conventional mining, beneficiation, and transport processes and concentrated on the beneficiation and transport components. Pit optimisation in support of open-cut mining is planned.
Figure 1: Perenjori Iron Ore Project
Location
The Perenjori Iron Project is exceptionally well positioned. It is located within 15km of both the Morawa-Peronjori trunk rail line and the Karara rail spur (Figure 1). The rail distance to Geraldton port is approximately 219km.
The Three Springs Golden Grove electricity transmission line is within 8km of the deposit. Numerous towns occur in the district that may supply the workforce for project development.
Mining Method
Conventional open pit methods using standard drill and blast and shovel and truck will be used to deliver magnetite ore to the beneficiation plant and waste to waste dumps. Nominal contract mining costs were used.
Beneficiation Flow Sheet
Ore will be beneficiated using standard crushing and two pass grinding, and magnetic separating. A rougher magnetic separator will use 220µm feed, with magnetic material passing to a secondary AG mill and a fine magnetic separation circuit using a grind size of P80 of 35µm. Weight recovery is expected to be 44% with an 85% yield of iron being achieved. The final indicative product specifications are shown in Table 1.
Table 1 Indicative magnetite product specifications
| Fe% | SiO2 | Al2O3 | P | S | LOI | -150µm | -35µm |
|---|---|---|---|---|---|---|---|
| 67.5 | 5.0 | 0.23 | 0.007 | 0.025 | 3.2 | 100% | 80% |
Transport
The Project benefits from two railways within 15km of the project. A spur railway line and trucking to rail head options were considered. Estimates of CAPEX and OPEX for both scenarios generate a similar Net Present Value within the accuracy of the costing estimate.
Power and Water
A 330kv line runs from Three Springs to the Karara and Golden Grove Mines (Figure 1). The line passes within 8km of the Perenjori Iron Project deposit. Costing for a connector to the Perenjori Iron Project has been estimated in the study. As an alternative, an LPG gas turbine- – based power source has been assessed.
Pit dewatering water may be available. This has not yet been demonstrated to be sufficient for the beneficiation plant’s needs. Good quality water is available within 60km of the project area and will be subject to the government water allocation scheme. A water supply pipeline has been included in the costs.
Port Facilities
Port storage and reclaim facilities at Geraldton to service Panamax-sized vessels are included in the costings. Access to port facilities will need to be negotiated.
Tenure
The Perenjori Iron Project is contained within E70/5311 owned 100% by Surefire. The tenement is subject to an ILUA. Standard environmental and Native Title approvals will be required during the process of converting this tenement to a Mining Lease and gaining mining permits.
Capital and Operating Cost Estimates
A high-level Net Present Value-based financial model was developed to assess the economic viability of the project. Cost estimates were deemed to be to an accuracy of +/-35%. While the regulatory guidelines discourage the release of mining and production rates and financial forecasts without more highly developed studies, the Scoping Study has underpinned the Board’s confidence that this project can deliver competitive high-grade magnetite at an economically rewarding return on investment.
Next Steps
The Company is planning to undertake additional resource definition drilling, in particular ensuring the stated Inferred Resource is converted to JORC (2012) standard, ahead of Prefeasibility Studies in 2022.
Perenjori West: Ni-Cu-PGE
Perenjori West tenements E70/5572 and E59/2446 are situated within the West Yilgarn Ni-Cu-PGE Province, the focus of intense exploration and host to Chalice Mining Ltd’s recent Julimar discoveries.
Surefire’s tenure covers largely concealed greenstones of the Koolanooka Greenstone Belt, which has been overlooked by previous explorers even though regional aeromagnetic data implied the presence of greenstones. Interpreted lithologies include acid volcanic and basic volcanics that become more mafic towards the base of the sequence culminating in interpreted ultramafic units. The layered mafics-ultramafics are considered prospective for Julimar-style nickel-copper-PGE mineralisation.
Surefire has completed the first phase of field reconnaissance, with highly anomalous nickel samples recorded in pXRF data. The Company intends to undertake wider surface geochemical sampling of the tenement as a prelude to planning for drill testing.