TIDMBZM
RNS Number : 6721A
Bellzone Mining PLC
07 February 2011
7.00 a.m. - 7 February 2011
Bellzone Mining plc
("Bellzone" or the "Company")
Forecariah Update
-- Accelerated development of the Forecariah iron ore joint
venture permits to achieve an initial production rate of 3-4 mtpa
by Q1 2012
-- Ramp up expected to reach 10 mtpa by 2013
-- Initial owner operate capital estimates of $300 - $350
million (Bellzone share 50%)
Bellzone Mining plc (AIM:BZM), the iron ore and nickel/copper
company operating in West Africa, is pleased to provide a further
update on the development of the Forecariah iron ore joint venture
permits ("Forecariah JV Permits") in Guinea, a 50:50 joint venture
with its partner China International Fund Limited ("CIF").
Following the positive results of the geologists report on the
Forecariah JV Permits, announced on 31 January 2011, Bellzone and
CIF have agreed to implement an accelerated programme to deliver a
10 million tonnes per annum (mtpa) direct shipping ore ("DSO") iron
ore operation, targeting initial production in Q1 2012.
The following activities have already occurred;
-- Trenching and sampling at Santiguiyah has commenced
-- Camp location selected and an 80 person camp sourced with
construction scheduled for March
-- Road feasibility study awarded
-- Port feasibility study tenders under review, with award due
by end of February
-- Detailed drilling plan for Yomboyeli completed, an initial
programme of 7,000 meters of RC drilling to commence in March
-- Preliminary flow-sheets options study underway
The development plan is focussed on defining and delivering
sufficient iron oxide ore from the identified targets to support an
initial production rate of 3-4 mtpa of DSO in Q1 2012, ramping up
to the target of 10 mtpa by 2013. The operation is expected to
consist of open pit mining, with product processing undertaken by
modular mobile plant. Power will be supplied to the mine site by
modular generators and water will be drawn from nearby rivers under
the environmental management plan.
Initial production will be transported to the port by 80t to
100t trucks. The port will consist of stockpiling areas and simple
static conveyors for barge loading. Barges between 6,000t and
14,000t will be loaded at a land backed wharf and will be taken
down river and out to the trans-shipping point by tugs. The product
will be loaded onto ore carriers by either a fixed trans-shipping
barge or by self un-loading vessels. This temporary truck and
trans-ship operation in the vicinity of Benti is being designed for
use until the main railway line and the Matakan port opens in
2014.
The road and port are readily and economically upgradeable to
enable DSO product export and the Company estimates that total
capital required for an owner operated operation will be
approximately $300-350 million with Bellzone contributing 50%.
Operating and capital expenditure trade-off studies are underway to
optimise expenditure through opportunities for contract mining and
processing, contract trucking and the leasing of barges and
tugs.
Nik Zuks, Chief Executive Officer commented "The initial target
for production at our Forecariah iron ore joint venture is 3-4
million tonnes per annum of DSO in early 2012. The skills,
resources and expertise available internally and through the joint
venture with CIF give us confidence in achieving this goal. The
market forecast of significant increases in iron ore prices over
the next two years adds impetus to our timeframes. We want to be in
a position to realise the full potential of the Forecariah project
and are excited about the value add of transforming Bellzone into a
near term iron ore producer.
Forecariah represents the beginning of the iron ore industry in
Guinea. Our initial production next year, ramping up to a possible
10 million tonnes per annum by 2013, will be the foundation
production for a national industry that could grow to exceed 200
million tonnes of iron ore per annum. To be the pioneers of this,
together with developing the multi-user rail and port
infrastructure, for our flagship Kalia Mine is an honour, and the
fact that Bellzone will underpin the iron ore industry in Guinea
motivates the whole team to perform."
Enquiries:
Bellzone Mining plc
Raj Kandiah/Terry Larkan +61 8 9420 8900
Canaccord Genuity Limited
Nominated Adviser and Joint Broker
to Bellzone
Andrew Chubb/Tarica Mpinga +44 (0)20 7050 6500
Renaissance Capital Limited
Joint Broker to Bellzone
Simon Matthews/Thomas Beattie +44 (0)20 7367 7777
Tavistock Communications +44 (0)20 7920 3150
Jos Simson/Paul Youens +44 (0)7843 260 623
Bellzone Mining plc
Bellzone Mining plc is an exploration and resource development
company with iron ore and nickel / copper permits in the Republic
of Guinea, West Africa.
The Company's flagship project, the Kalia Iron Mine has a JORC
resource of 3.74 billion tonnes, located on the Kalia I prospect.
Drilling results and internal estimates indicate that Kalia
Prospect has the potential to host more than 10 billion tonnes of
magnetite and 2.55 billion tonnes of oxide at surface.
Exploration work continues to further define the potential at
Kalia I on both the magnetite and oxide at surface.
Bellzone is committed to the staged development of the Kalia
Iron Project, which includes a 50 mtpa iron ore facility, rail and
port, with initial production scheduled in 2014. Stage one is
planned to bring online 20 mtpa direct shipping ore ('DSO')
capacity in 2014 and a 10 mtpa magnetite concentrator in 2015.
Stage two increasing the DSO output to 30 mtpa in 2017 and doubling
the concentrate capacity to 20 mtpa by 2018.
Bellzone signed an Infrastructure Accord with the Republic of
Guinea giving the Company exclusive rights to the designated port
and rail areas for purposes of conducting studies for the
development of the infrastructure leading to the signing of a
convention and concession. The infrastructure forms a key part of
the Guinea Government's infrastructure strategy and will support
the development of iron ore, bauxite and other minerals in Guinea
through its availability for third party use.
On 2 August 2010, Bellzone signed definitive agreements with
China International Fund ('CIF'). CIF will finance and develop the
rail and port infrastructure and offer a finance package to
Bellzone for the development of the Kalia Mine in exchange for the
first right to purchase 100% of the off-take of the Kalia Mine at
market price.
An exploration and development programme is currently underway
at the CIF held Forecariah Iron Permits that lie between 40 and
80kms from the Guinea coast. Bellzone and CIF will jointly develop
these permits which are prospective for oxide and magnetite. The
oxide has the potential to deliver cash flow from a Direct Shipping
Ore project in 2012.
Bellzone has competed an intensive mapping and surface sampling
programme and has defined highly prospective drilling targets at
its Sadeka Nickel/Copper Project and commenced a drilling programme
on these targets in Q4 2010.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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