TIDMAAAM
RNS Number : 7566A
African Aura Mining Inc.
06 February 2011
NOT FOR DISTRIBUTION IN THE UNITED STATES OR FOR DISSEMINATION
TO US NEWS WIRE SERVICES.
7 February 2011
TSX-V: AUR
AIM: AAAM
PUTU IRON ORE RESOURCE MORE THAN DOUBLES TO 2.4 BILLION
TONNES
African Aura Mining Inc. ("African Aura" or the "Company"), the
TSX--V (AUR) and AIM (AAAM) listed exploration and development
company is pleased to announce an updated independent National
Instrument 43-101 compliant Mineral Resource Estimate at its 38.5%
owned Putu iron ore project in Liberia.
-- Inferred resource increased to 2.4 billion tonnes of iron
mineralisation at 34% Fe
-- Test work on magnetite BIF indicates a high grade concentrate
can be produced
-- Potential for direct shipping ore exists to generate near
term cash flow
-- Aggressive drilling campaign underway and expected to total
>60,000m
-- Potential for a further 1 to 2.5Bt below current modelled
optimised pit shell
Luis da Silva, Chief Executive of African Aura, commented:
"The more than doubling of the resource at the Putu iron ore
project in Liberia to 2.4Bt is further excellent news for African
Aura's shareholders. The headline objective of African Aura and our
joint venture partner Severstal Resources was a 2Bt tonne resource
and I am very pleased that this has rapidly been achieved. We
expect to upgrade this resource to the indicated category during
2011. The JV partners are mindful of the importance of moving the
project forward as efficiently as possible, for the benefit of the
local communities and all other stakeholders, and I look forward to
providing updates on progress in due course.
This news also comes on top of our announcement last week of a
maiden 1Bt resource at our 100% owned Nkout iron ore project in
Cameroon. African Aura's attributable iron ore inventory has
increased fivefold in short order, from 0.38Bt at 34% Fe in 2010 to
the current 1.96Bt at 34% Fe (equivalent to 666Mt of contained
iron) and with the potential for significant further growth from
here. The rationale for the proposed split of the Company into
separately listed iron ore and gold companies, with shareholders in
African Aura receiving one share in each company for each share
they hold in African Aura, is a means to allow the market to better
measure and reflect the intrinsic value of our assets which is
becoming increasingly apparent."
Mineral Resource Estimate
This Putu Mineral Resource estimate, issued by independent
engineers SRK Consulting (UK) Ltd ("SRK") has been prepared for the
Company and made compliant with Canadian National Instrument 43-101
(NI43-101).
The report serves as an independent report prepared by a
Qualified Person as defined by the Canadian National Instrument
43-101 and the companion policy 43-101CP. The definitions of
Measured, Indicated and Inferred Resources, as well as reserves as
used by the author, conform to the definitions and guidelines of
the CIM (Canadian Institute of Mining, Metallurgy and Petroleum)
reporting codes.
Table 1: Putu Project, Mineral Resource Estimate
Resource SiO2 AL2O3
Zone Category Tonnes (Mt) Fe % % % P %
--------------- ---------------- ------------ ------ ------ ------ -----
Oxide Measured - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Indicated - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Meas + Ind - - - - -
---------------- ------------ ------ ------ ------ -----
Inferred 185 37.82 37.94 2.84 0.08
-------------------------------- ------------ ------ ------ ------ -----
Magnetite
Itabirite Measured - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Indicated - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Meas + Ind - - - - -
---------------- ------------ ------ ------ ------ -----
Inferred 2,173 33.7 44.43 1.38 0.07
-------------------------------- ------------ ------ ------ ------ -----
Haematite
itabirite Measured - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Indicated - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Meas + Ind - - - - -
---------------- ------------ ------ ------ ------ -----
Inferred 17 48.25 22.51 0.81 0.1
-------------------------------- ------------ ------ ------ ------ -----
TOTAL Measured - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Indicated - - - - -
--------------- ---------------- ------------ ------ ------ ------ -----
Meas + Ind - - - - -
---------------- ------------ ------ ------ ------ -----
Inferred 2,374.00 34.1 43.8 1.49 0.07
-------------------------------- ------------ ------ ------ ------ -----
Notes:
(1) The effective date of the Mineral Resource Estimate is 4
February, 2011
(2) The Mineral Resource Estimate for the Putu deposit was
constrained within lithological and grade based solids and within a
Lerchs-Grossman pit shell defined by the following assumptions;
metal price of USD1.40/dmtu; slope angles of 44 ; a mining recovery
of 97.5%; a mining dilution of 2.5%; a base case mining cost of
USD1.40/t and an incremental mine operating costs of USD0.05/t/10 m
below the 100m reference RL and USD0.05/t/10 m above the 100 m
reference RL; process operating costs of USD2.68/t crushed oxide
andUSD5.67/t crushed BIF mineralisation; and G&A costs of
USD2,915/t crushed mineralisation.
(3) Mineral Resources for the Putu deposit has been classified
according to the "CIM Standards on Mineral Resources and Reserves:
Definitions and Guidelines (December 2005) by Howard Baker
(MAusIMM) an independent Qualified Person as defined by National
Instrument 43-101.
In total, SRK has estimated an Inferred Mineral Resource for the
Putu Project of 2.37 billion tonnes ("Bt") grading 34.1% Fe, 43.8%
SiO2, 1.49% Al2O3 and 0.07% P. Of this, 185 million tonnes ("Mt")
grading 37.8% Fe lies within surface oxidized zone, 2.17 Bt grading
33.7% Fe lies within the fresh magnetite itabirite zone, and 17 Mt
grading 48.25% Fe lies within the fresh haematite itabirite
zone.
Putu Resource Potential
The Putu model is open at depth and SRK recognises that there is
potential to increase the Mineral Resource Statement by targeting
material that falls below the optimised pit shell but remains
potentially economic. This material, based on a metal price of
USD1.40/dmtu is considered by SRK to be potentially economic,
should sufficient exploration data be collected that confirms the
geometry and continuation of the mineralisation and that enables a
classified resource to be estimated.
SRK has identified that an additional 1 to 2.5 Bt lies below the
optimised pit shell used for constraining the Inferred Mineral
Resources. The potential quantity of tonnes is conceptual in nature
as there has been insufficient exploration or demonstration of
economic viability to report these in the Inferred Mineral Resource
category at the current time. It is uncertain if further
exploration will result in these targets being defined and reported
in a future Mineral Resource Estimate. These potential tonnages
reflect a range of material within SRK's wireframe solid models
outlining the interpreted down dip extent of mineralisation.
Database Validation
The QA/QC program for Company's Putu project consists of
alternating the insertion of a blank and duplicate sample on a
regular basis within the sample train. All samples have been
assayed at the accredited SGS Johannesburg laboratory in South
Africa. SRK found that the results of the above described QA/QC
program indicate that the Company's Putu assay databases were
appropriate for Mineral Resource Estimation, however, these
databases need to be improved in order to upgrade the Inferred
Mineral Resources to Indicated Mineral Resources.
Data Verification
Howard Baker as qualified person completed the verification of
data on which the Putu Resource Estimate was based. This
verification included an assessment of QA/QC data, sample
preparation and assay methodologies, density data, data inputs and
survey data used in the estimate. Data was validated by using field
checks, statistical methods and evaluating the Company's
protocols.
Geological Modelling, Resource Estimation Assumptions,
Parameters and Methods
Putu can be divided into two main areas, Montroh and Jideh. The
former is east-west trending, and the latter is
northnortheast-southsouthwest trending. Both areas are compromised
of magnetite Banded Iron Formation ("BIF") with oxidized caps of
dominantly haematite mineralisation. SRK created a geological model
based on the lithological logging and magnetic susceptibility data
enabling two separate antiform structures, one at Jideh and one at
Montroh, comprising BIF material to be modelled and a three
dimensional solid to be created. A statistical review of the
validated drill hole data enabled a domain to be created within the
oxidized cap. Internal metasedimentary waste domains created within
the BIF and oxidized cap were based on lithology logging, magnetic
susceptibility data, Fe and Al2O3- assay grades.
A 5 m composite file was used in a geostatistical study
(variography and Quantitative Kriging Neighbourhood Analysis,
"QKNA") that enabled Ordinary Kriging ("OK") to be used as the main
grade interpolation method. The interpolation used an elliptical
search following the predominant dip and dip direction of the
geological domains. The results of the variography and the QKNA
were utilised to determine the most appropriate search and
estimation parameters.
The interpolated block model was validated through visual checks
and a comparison of the mean input composite and output model
grades. SRK is confident that the interpolated block grades are a
reasonable reflection of the available sample data.
Putu Metallurgical Test Work
As previously announced, metallurgical test work was conducted
on five samples from each of the main mineralisation units -
magnetite itabirite epidote-chlorite magnetite itabirite, haematite
itabirite, transitional magnetite itabirite, and weathered
(predominantly haematite) itabirite. The test work was undertaken
by Amdel Mineral Laboratories in Australia.
The test work results indicate that the unweathered magnetite
itabirite should be amenable to conventional magnetite processing,
that is, using several stages of Wet Low Intensity Magnetic
Separation.
Given the high (60%) recovery achieved for the transitional
itabirite sample in the Davis Tube tests, despite the low magnetite
content of this material according to the Satmagan measurement,
this material may be amenable to the same flow sheet as the
unweathered magnetite itabirite, albeit with a lower recovery. The
suitability of this material to such a flow sheet may also depend
on the relative proportions of this material to unweathered
magnetite itabirite in the resource.
For the weathered itabirite and haematite itabirite samples, a
process route possibly consisting of a combination of gravity
separation, magnetic separation and flotation is indicated. In all
cases, further test work is required in order to firm up potential
process flow sheets and optimise the conditions under which to
achieve a combination of acceptable product quality and
recovery.
Putu Mineral Resource Classification
The Putu project has been classified as containing Inferred
Mineral Resources in the unweathered itabirite and oxidised
domains. This is mostly due to the current lack of assay data and
the requirement for more robust QAQC results. Inferred Mineral
Resources have been extrapolated no more than 200 m down dip of the
deepest drill hole intersection. It is the opinion of SRK that the
down dip extension of Inferred Mineral Resources is justified in
areas of unsupported blocks due to the known down-dip extensions
observed in the geological logging and the quality of the estimate
in adjacent blocks.
About the Putu Iron Ore Project
The Putu iron ore project is a 13km long iron rich ridge,
located only 130km inland from the deepwater shoreline of eastern
Liberia. In February 2011 the Company announced an Independent
Mineral Resource of 2.4 billion tonnes of iron mineralisation at
34% total iron (Fe). The best drill results to date are 73m @ 60.4%
Fe in hole PDD011 (predominantly oxide) and 366m @ 41.5% Fe in hole
PDD052 (predominantly magnetite itabirite, with some haematite
itabirite).The project is being advanced in joint venture with
Severstal Resources who are earning a 61.5% interest in the project
as it moves towards completion of a Pre-Feasibility Study. A
Mineral Development Agreement detailing the fiscal and legal terms
for the development and mining of the Putu iron ore deposit was
granted and ratified by the Government of Liberia on 9th September
2010.
Cautionary Statement
The effective date of the Putu Mineral Resource Estimate is
February 04, 2011. The Fe % presented in the above table is not
meant to imply recoverable product. Mineral Resources for the Putu
iron ore Project have been classified according to the "CIM
Standards on Mineral Resources and Reserves: Definitions and
Guidelines (December 2005) by Howard Baker (MAusIMM) an Independent
Qualified Person as defined by National Instrument 43-101. Mineral
Resources were estimated in conformity with generally accepted CIM
"Estimation and Mineral Resource and Mineral Reserve Best Practices
Guidelines". SRK is not aware of any known environmental,
permitting, legal, title, taxation, socio-economic, marketing or
other relevant issues that could potentially affect the estimate of
Mineral Resources. The Mineral Resource may be affected by further
exploration drilling which may increase or decrease the estimate.
The Mineral Resource may also be affected by subsequent assessments
of mining, environmental, processing, permitting, taxation,
socio-economic and other factors. There is insufficient information
at this stage to assess the extent to which the Mineral Resource
will be affected by these factors that are more fully assessed in a
feasibility study. Mineral Resources are not Mineral Reserves and
do not have demonstrated economic viability. Mineral Reserves can
only be estimated based on the results of an economic evaluation as
part of a preliminary feasibility or feasibility study. No Mineral
Reserves have been estimated by SRK as part of the current
assignment. There is no certainty that all or any part of the
Mineral Resource will be converted to a Mineral Reserve. The
quantity and grade of reported Inferred Mineral Resource in this
estimate are uncertain in nature and there has been insufficient
exploration to define these Inferred Mineral Resources as an
Indicated or Measured Mineral Resource; and it is uncertain if
further exploration will result in upgrading them to an Indicated
or Measured Mineral Resource category.
Qualified Person
Howard Baker has some ten years experience in the exploration,
definition and mining of iron ore Mineral Resources. Howard Baker
is a full-time employee of SRK Consulting (UK) Ltd, an independent
Consultancy and has sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration,
and to the type of activity which he is undertaking to qualify as a
Qualified Person in accordance with NI43-101 and a Competent Person
as defined in the June 2009 Edition of the AIM Note for Mining and
Oil & Gas Companies. Howard Baker consents to the inclusion in
the announcement of the matters based on their information in the
form and context in which it appears and confirms that this
information is accurate and not false or misleading.
The NI 43-101 compliant Technical Report on the Mineral Resource
Estimate will be filed on www.sedar.com within 45 days.
About African Aura Mining Inc.
African Aura is an established exploration and development
company listed on the TSX-V (AUR) and London's AIM (AAAM). The
Company operates two divisions that are intended to be split into
separate listed companies becoming effective, subject to
shareholder, regulatory and other approvals in April 2011:
- The iron ore division includes its 38.5% interest in the 2.4Bt
Putu iron ore project in Liberia, which is subject to a resource
expansion drilling programme and moving through pre-feasibility
managed by joint venture partner Severstal Resources (the mining
division of Moscow listed OAO Severstal). In September 2010 Putu
was granted a 25 year renewable Mineral Development Agreement by
the Government of Liberia. The division also includes a 100%
interest in the Nkout 1Bt iron ore project and surrounding iron
targets in Cameroon which is subject to a resource expansion
drilling programme.
- The gold assets, to be held in "Aureus Mining Inc." when
listed independently, include the New Liberty gold deposit in
western Liberia which has a resource of 1.51 million ounces of gold
grading 3.78 g/t (comprising 5,599,000 tonnes grading 4.17 g/t in
the indicated category and 7,040,000 tonnes grading 3.40 g/t in the
inferred category) which is being advanced through a bankable
feasibility study, and the proximal Ndablama, Weaju, Silver Hills
and Gondoja gold projects all within the Company's Bea Mountain 25
year renewable Mineral Development Agreement.
In addition, the Company has a 22% interest in AIM-listed
diamond producer Stellar Diamonds Plc (AIM: STEL,
www.stellar-diamonds.com).
The Company has a highly motivated and experienced team with a
track record of discovering mines and taking projects through
development and into production. As a pioneer, African Aura has
attracted some excellent strategic partners and shareholders,
always with the objective of preserving or enhancing shareholder
value. For further information on the Company you are invited to
visit its website at www.african-aura.com or SEDAR's website at
www.sedar.com, or contact one of the following:
African Aura Mining Inc.
Luis da Silva, President & CEO Tel: +44 (0) 20 7257 2930
Evolution Securities Limited
Rob Collins / Tim Redfern Tel: +44 (0) 20 7071 4300
Pelham Bell Pottinger
Charles Vivian / James MacFarlane Tel: +44 (0) 20 7861 3232
Forward-looking Statements
This press release includes certain forward-looking statements.
All statements, other than statements of historical fact, included
herein, including without limitation, statements regarding the
future plans and objectives of African Aura, are forward-looking
statements that involve various known and unknown risks and
uncertainties as well as other factors. Such forward-looking
statements are subject to a number of risks and uncertainties that
may cause actual results or events to differ materially from
current expectations, including delays in obtaining or failure to
obtain required regulatory approvals. There can be no assurance
that such statements will prove to be accurate and actual results
and future events could differ materially from those anticipated in
such statements. Any forward-looking statements speak only as of
the date hereof and, except as may be required by applicable law,
African Aura disclaim any obligation to update or modify such
forward-looking statements, either as a result of new information,
future events or for any other reason.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accept responsibility for the adequacy or
accuracy of this release.
Ends
This information is provided by RNS
The company news service from the London Stock Exchange
END
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