Special Report: With Magnetite Mines now cashed up and in prime position to take the next step at its Razorback iron ore mine in South Australia, it has beefed up its expertise and started work on the all-important pre-feasibility study (PFS).

Magnetite Mines (ASX:MGT) recently completed an oversubscribed $1.28m rights issue and reached agreement on the material terms of a $20m farm-in offer with Braemar Mining Developments (BMD), which places it in prime position to forge ahead with the PFS.

Chairman Peter Schubert said the recently announced BMD farm-in proposal provided a potential additional source of funding if it advanced to a binding agreement.

Miners usually undertake up to four different types of studies to see whether or not a resource can be mined economically. These are, in order of importance, scoping, PFS, definitive feasibility (DFS) and bankable feasibility (BFS)

The PFS will investigate a staged approach to the development of the 4-billion-tonne Razorback mine and build on the positive results defined by the scoping study completed in November last year.

To help complete the PFS, Magnetite Mines has engaged the independent geological and metallurgical services of specialist consultants Kerry Whitby and Richard Harmsworth.

Schubert said the company was focused on delivering value for shareholders.

“Strategic team development is a priority for the board as we progress the project as efficiently as possible through further development studies.

“Both Kerry and Richard bring many years of global iron ore and mining experience to the Razorback iron project and will assist in accelerating the company’s plans for a low capital start-up operation.”

Whitby is a specialist consultant geologist with 50 years’ experience in exploration and development of stratiform deposits including coal and iron ore.

He and his team at McElroy Bryan Geological Services will undertake innovative exploration and geological modelling techniques that will support a selective mining approach.

“The Razorback iron project is supported by an extensive and comprehensive dataset and has potential resource upside without the need for expensive drilling,” Whitby said.

“I look forward to investigating the deposit’s move towards a more selective mining approach as the company progresses its PFS.”

Meanwhile, Harmsworth is a consultant geologist with 55 years’ experience specialising in iron ore.

He was chief geologist for Rio Tinto’s Hamersley Iron operations in the Pilbara in the 1980s and later worked in their Resource Development and New Business groups.

Harmsworth was subsequently chief geologist for Sphere Minerals for its magnetite exploration and development programs in northern Mauritania.

He said the Braemar Iron Formation — the target of Magnetite Mines’ Razorback project — clearly formed an extensive magnetite rich geological province.

“It is a distinctive fine-grained sedimentary ore type and is significantly softer than the banded iron-formations (BIFs) typically mined as magnetite ores around the world,” he noted.

“Test work to date shows that high-grade, low-impurity magnetite concentrates can be readily produced and at lower cost than from harder BIFs of similar grade.

“I am looking forward to my involvement with this project, particularly in reviewing the existing knowledge base and providing input as the project advances.”


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This story was developed in collaboration with Magnetite Mines, a Stockhead advertiser at the time of publishing.
This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.