Mba Delta Ironsands

Viti Levu, Fiji

 

PROJECT HIGHLIGHTS

Indicated Resource - 220 million tonnes averaging 10.9% Fe (Iron)

PROJECT OVERVIEW

The Mba Delta Ironsand Magnetite Project is located on the northwest coast of Fiji’s largest island, Viti Levu.

Construction of a sole-use wharf, enclosed stockpile shed and export facility for magnetite concentrate has been approved for Amex’s port site lease at Lautoka, the country’s second largest city and major bulk commodities port. Nadi International airport is only 25 kilometres from Lautoka, and is reached via the main highway.

The magnetite-rich ironsands resource lies predominantly in tidal flats at the mouth of the Ba River, in a sparsely populated agricultural area a further 30 kilometres north-east of Lautoka along the Kings Road. The resource is held 100% by Amex under mining lease SML60 and surrounding special prospecting licence SPL1463, which together cover more than 132 square kilometres.

The resource occurs as a simple flat lying blanket of unconsolidated fine to coarse magnetite-bearing sand approximately 15 kilometres long by up to 4 kilometres wide. It is developed from surface to depths of up to 9.4 metres, and averages 4.3 metres in thickness. Continuity of magnetite mineralisation and geological control within the deltaic sand deposit is excellent, and much of the surface of the resource is exposed at low tide.

Only that part of the deposit extending from the shoreline to approximately two metres means water depth has been drill tested and included within the current JORC resource estimate. Both the seaward and landward extensions of the deposit have yet to be drilled, and present an attractive exploration target with potential to add substantially to resource tonnage.

A conventional dredging operation will be used to excavate the ore, at a rate of up to one million tonnes per month. The material will be pumped from the dredge along a floating pipeline to a nearby barge-mounted process plant, where the magnetite will be recovered by way of a simple two-stage magnetic process. No chemicals or high-energy grinding will be required, as the natural process of tropical weathering has freed the magnetite from the enclosing gangue minerals.

The concentrated magnetic sand product will be pumped into a barge moored alongside the process plant, and transported along the existing Ba Roads shipping route to Amex’s Lautoka port site. Two barge loads will be shipped each day, replacing the need for capital expensive rail/road infrastructure that some other projects require.

On arrival at the port, the product will be unloaded and washed in fresh water to remove sea salt, then dried and stockpiled awaiting export to markets predominantly in Asia.

Deposits of ironsands with similar chemical characteristics have been successfully mined for over 30 years in New Zealand, for domestic steelmaking and export to Asian consumers.

JORC RESOURCE

The JORC resource was estimated from results of a comprehensive programme of drilling across the mineralised sand banks of the delta. The programme utilised an innovative drilling methodology, namely a barge-mounted Sonic Core drill rig, due to the logistical issues of working in an intertidal environment.

The estimate was prepared and first reported under the 2004 edition of the JORC Code (The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves). As the information has not materially changed since then, the estimate has not been updated to comply with the revised 2012 JORC Code.

EXPLORATION TARGET

The Sonic Core drilling programme tested the shallow and intertidal zones of the Mba Delta, planned to be the focus of initial mining. This area comprises less than 30% of the total area held under tenure by Amex. Reconnaissance sampling and geological mapping has shown that the magnetite-rich ironsand mineralisation extends both seawards and landwards from the Indicated Resource boundaries, leading to definition of an additional exploration target of:

"200-300 million tonnes averaging 10-15% Fe"

As required under clause 17 of the JORC Code 2012, it is stated that “the potential quantity and grade of this exploration target is conceptual in nature and there has been insufficient exploration to define a Mineral Resource outside the current Indicated Resource boundaries. It is uncertain that further exploration will result in the determination of additional Mineral Resources within this exploration target.”

PORT

Amex has negotiated a long term lease agreement over 5.919 hectare at Fiji’s major bulk commodity shipping port of Lautoka. The port facility is well located, being less than 30 kilometres southwest of the Company’s Indicated Resource and serviced by the second largest city in Fiji.

The Lease agreement with Fiji Ports Corporation Limited, a Government enterprise, is for 45 years, comprising an initial 15 year term and two further option periods. This term reflects the potential project mine life, based on the current Indicated Resource of 220 million tonnes and the additional exploration target which extends both inland and seaward.

Amex’s port facility will provide a logistics base for the dredging and barging operation on the nearby Mba Delta, planned to produce an initial 750,000t of magnetite concentrate annually, and will act as a stockpiling area for the magnetite concentrate prior to final treatment and export.

Lautoka is Fiji’s largest port for export of bulk cargoes, with ready access to major shipping lanes crossing the Pacific to Asia, including major potential markets for iron ore in China. Securing this vital part of the export infrastructure represents a major step for the future success of Amex’s Mba Delta operations.