Fenix gets busy drilling to grow its high-grade iron ore resource
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Special Report: Fenix Resources is the ASX’s newest and one of very few emerging junior high-grade producers and it is wasting no time on building its iron ore resource.
Approvals in hand, the company is undertaking 5500m of drilling to test potential extensions to the current resource of 5 million tonnes at 64.1 per cent iron at its flagship Iron Ridge project.
Fenix (ASX:FEX) also aims to increase the confidence of the resource by shifting tonnes into the “indicated” category.
Mineral resources are categorised in order of increasing geological confidence as inferred, indicated or measured.
Fenix’s goal is to increase the resource up to 8 to 10 million tonnes at 65 per cent iron ore, which attracts big dollars and is something not even majors BHP (ASX:BHP) and Rio Tinto (AS:RIO) are producing.
The price gap between low-grade and high-grade iron ore has widened as Chinese steelmakers increasingly favour higher grade feedstocks to boost mill productivity and meet more stringent pollution control measures.
Well-respected geological consultancy group CSA Global previously estimated an exploration target on top of the existing resource of 600,000 tonnes to 7.1 million tonnes of predominantly hematite mineralisation grading between 64.1 per cent and 65.3 per cent iron with low deleterious elements.
The consultant predicts Fenix could also define a further 100,000 tonnes to 5.7 million tonnes of goethite mineralisation grading 58 per cent to 59.5 per cent iron with slightly elevated deleterious elements.
Initial drilling results are expected in the first quarter of 2019, with regular updates over the next few months.
Fenix plans to conduct metallurgical test work, including lump to fines ratio testing, and provide samples to prospective customers in the first half of next year.
The company is also in talks with potential freight partners.
The company is ticking a lot of boxes as it fast tracks its way to becoming a near-term high-grade iron ore producer.
Fenix Resources is a Stockhead advertiser.