ASX-listed aspiring gold and iron ore developer, CZR Resources has cranked up a 7,800m infill reverse circulation drilling program as a key part of the definitive feasibility study underway on its 85 per cent-owned Robe Mesa iron ore project in WA’s Pilbara. The drilling is aimed at growing the indicated resource and further de-risking the project in tandem with ongoing technical and economic studies.
The Robe Mesa deposit covers a geological area abutting Rio Tinto’s Warramboo, Mesa A and Mesa J-K mines which export around 34 million tonnes per year of iron ore. It is a key part of CZR’s Yarraloola Project which is located approximately 140 kilometres southwest of Karratha. The project is also close to the township of Pannawonica, a support town for the nearby Rio Tinto operations. Yarraloola is accessible by the Northwest Coastal Highway - a sealed road that connects all major towns in the West Pilbara.
Geologically, the Yarraloola Project has basement rocks consisting of Ashburton Basin sediments and volcanics which area overlain in parts by sediments of the Carnarvon Basin. Iron mineralisation in the Ashburton Basin comprises a sequence of magnetite-rich rocks intercalated with felsic volcanics mapped over a 12km long by 1km area. In the Carnarvon Basin, flat-topped mesas of pisolitic ironstone are concentrated in palaeo-channels associated with the Robe River. Pisolites are sedimentary rocks made of concretionary grains of carbonate.
The tenure held by CZR in this palaeo-channel system is contiguous with iron ore resources held by Rio Tinto.
CZR hopes to upgrade inferred resources to the indicated category and to close the current drill hole spacing to assist with the mine scheduling element of the feasibility study.
Drilling is expected to be ongoing for about 5 weeks and samples will be regularly sent to the assay laboratory.
CZR says the pre-feasibility study showed Robe Mesa has potential to produce robust financial returns based on production of 2 million tonnes per annum of direct shipping ore over greater than 5 years.
The project’s reserves currently stand at 8.2 million tonnes grading 56 per cent iron with a payback period of just 19 months based on a set of factors including a benchmark iron ore price of US$90 per tonne.
The company has been engaged in a range of activities designed to de-risk the project in preparation for development, including importantly the lodgement of mining lease application to cover the proposed mining area on the Robe Mesa iron ore deposit
A desktop study is also underway to determine any significant hydrological impacts on the proposed mine and associated infrastructure. It is being conducted concurrently with another review aimed at identifying targets for groundwater to support haul-road development, camp, plant-site and future dust-suppression requirements have been completed.
From an environmental point of view, two of three field-based programmes of the flora, fauna and stygofauna studies required for the future approval of mining have been finalised.
Topographic and heritage data has been acquired for relevant surveys over the area. A successful introductory meeting in Karratha with the Robe River Kuruma Native Title representative body provided a useful framework to discuss a process for the approval of the mining operation and the compensation agreement which will be required for grant of the mining lease.
Interestingly, the company says it is acquiring additional exploration tenure to add to its inventory of iron ore targets and access to areas that might provide flexibility for project development.
Discussions are also ongoing with operators of the Onslow Marine Support Base to develop the Beadon Creek facility into an iron ore transhipping operation with the scale to support the export of million tonnes per year from production from the Robe Mesa iron ore deposit. The Onslow opportunity represents a 60 per cent less haul distance than to Port Hedland and would therefore generate significant cost savings.
Going forward, CZR is planning a range of geotechnical, geochemical,
metallurgical and mining-related studies that are being updated and extended utilising the infill drilling data.
The company anticipates updating the financial model after a range of stakeholder meetings are held and extra detailed technical, operational and capital-cost data flows into the project database.
CZR hopes to finish the DFS this year.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
