Kalia Mine Project Operational Update (6504E)

TIDMBZM

RNS Number : 6504E

Bellzone Mining PLC

11 April 2011

Bellzone Mining plc

("Bellzone" or the "Company")

Kalia Mine Project Operating Update

Bellzone Mining plc (AIM:BZM), the iron ore and nickel/copper company developing the Kalia Mine Project, the Forecariah JV and the Sadeka nickel/copper project in the Republic of Guinea, West Africa, is pleased to present an operational update for the Kalia Mine Project.

The resource development plans and detailed feasibility study ("DFS") at the Kalia Mine Project have been progressing well through 2011 and remain on schedule. A number of key project activities have been undertaken, as per the project plan, all of which provide valuable detail to the engineering and cost estimates required to complete the DFS and further extend our extensive iron ore resources.

DFS activity highlights:

-- Completion of airborne Lidar surveys, providing 0.5m topographic contours of the Kalia permit area to provide critical input to plant layout design, bulk earthworks costing as well tailings storage facility site selection and design

-- Contracts awarded to undertake the site geotechnical and hydrological engineering providing key inputs to finalise the mine plan and site civil engineering requirements

-- Magnetite bulk testwork completed validating the production of a +68% Fe concentrate with low deleterious elements

-- Magnetite metallurgical test-work completed which is critical to the design of flowsheets and equipment requirements

-- Preliminary Whittle shell models supporting mine planning completed

-- Oxide metallurgical test-work undertaken confirming a quality product is achievable through standard processing techniques

-- Oxide testwork conducted for ore with beneficiation potential providing input into the flowsheet development and equipment selection

-- Draft Socio Economic Impact Assessment and Environmental Impact Assessment reports completed

Magnetite Resource Development

Kalia I

Since the release of the 3.74 billion tonne JORC update in September 2010, the magnetite resource development programme focussed on completing and infill plan to further upgrade the existing 670 million tonne measured and indicated JORC resource. This programme was completed in the first week of April 2011 and the Kalia I JORC resource upgrade is expected to be completed in Q3, 2011.

Magnetite Resource Development Highlights since September 2010 upgrade:

-- 13,022m diamond drilling completed on infill programme

-- 4,188 samples sent for assay

Kalia II

The Kalia magnetite development plan now is to undertake a wide spaced drilling campaign of the Kalia II magnetite. This drilling campaign, the first on Kalia II, has commenced and will take approximately six months to complete.

-- 800m of 17,000m programme completed at Kalia II (as at 8 April 2011)

Oxide Resource Development

Bellzone has mapped 55 km(2) of surface oxide material over the 100% Bellzone Kalia permit. The maiden oxide JORC campaign has been focused on a 2.3km(2) area located above the existing 3.74 billion tonne magnetite JORC resource. This material has to be removed prior to the start of the magnetite operations. Targeting this material as the initial production source supports the optimisation of the mining plan and reduces operating cost.

Due to the large number of samples processed in support of the JORC resource and the unusual congestion in the laboratories in Perth, Western Australia, we have experienced a delay in finalising the JORC resource. Currently all metallurgical assay and testwork has been compiled and is under review prior to issue CSA Global, Bellzone's independent geologists, for assimilation into the JORC resource estimation. Taking into account the upcoming Easter period, Bellzone expects to release the JORC resource estimation in May 2011.

Oxide Resource Development Highlights:

Kalia I

-- 20,139m reverse circulation drilling completed at Kalia I

-- 7,905 samples from Kalia I sent for assay

Kalia II

-- 4,404m of a 28,000m programme of reverse circulation drilling completed at Kalia II

-- 796 from Kalia II samples sent for assay

Oxide resource development is ongoing with a drilling campaign targeting the 13km(2) Kalia II oxides. Current results from Kalia II are encouraging with thickness of the oxides of over 30m being measured.

Graham Fyfe, Chief Operating Officer commented: "The start of 2011 has been a very busy period for the company. Not only have we raised sufficient funds to ensure the Forecariah JV project is financed to completion, but our various project specific teams have ensured that all our projects are running full steam ahead. We are confident of achieving our study and resource development objectives and moving towards construction start at the Kalia Mine Project before year end, while continuing the parallel development of the near term production target Q1, 2012 of the Forecariah JV project."

 
 Enquiries: 
 
 Bellzone Mining plc 
 
 Graham Fyfe/Terry Larkan              +61 8 9420 8900 
 
 
 Canaccord Genuity Limited 
 
 Nominated Adviser and Joint Broker 
  to Bellzone                          +44 (0)20 7050 6500 
 
 Andrew Chubb/Tarica Mpinga 
 
 Renaissance Capital Limited 
 
 Joint Broker to Bellzone              +44 (0)20 7367 7777 
 
 Simon Matthews/Thomas Beattie 
 
 Tavistock Communications 
 
 Jos Simson/Paul Youens                +44 (0)20 7920 3150 
 
                                       +44 (0)7899 870 450

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 Mine Project 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 50mtpa iron ore facility, rail and port, with initial production scheduled in 2014. Stage one is planned to bring online 20mtpa oxide production capacity in 2014 and a 10mtpa magnetite concentrator in 2015. Stage two increasing the oxide output to 30mtpa in 2017 and doubling the concentrate capacity to 20mtpa 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 3rd 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 programme is currently underway at the Forecariah Iron Permits that lie between 60 and 80kms from the Guinea south 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 the short term.

Bellzone has competed an intensive mapping and surface sampling programme and has defined highly prospective drilling targets at its Sadeka Nickel/Copper Project. Drilling has commenced and results are expected in Q2 2011.

This information is provided by RNS

The company news service from the London Stock Exchange

END

DRLGLGDSSGBBGBB

Bellzone Mining (LSE:BZM)
Historical Stock Chart
From Jun 2024 to Jul 2024