MARCH 2010 QUARTERLY REPORT - ASX · 2010. 4. 28. · MARCH 2010 QUARTERLY REPORT 1 The estimates...
Transcript of MARCH 2010 QUARTERLY REPORT - ASX · 2010. 4. 28. · MARCH 2010 QUARTERLY REPORT 1 The estimates...
MARCH 2010 QUARTERLY REPORT
1 The estimates of exploration target sizes mentioned in this release should not be misunderstood or misconstrued as estimates of Mineral Resources. The estimates of exploration target sizes are conceptual in nature and there has been insufficient results received from drilling completed to date to estimate a Mineral Resource compliant with the JORC Code (2004) guidelines. Furthermore, it is uncertain if further exploration will result in the determination of a Mineral Resource. 1 www.apo l l omine ra l s . com.au
28 APRIL 2010
ABOUT APOLLO MINERALS
Apollo is an iron ore explorer and developer with two key projects in the Australian iron ore provinces of Pilbara (WA) and Gawler (SA). Apollo’s projects are located close to existing and proposed infrastructure including rail and ports.
Apollo Minerals Limited ABN: 96 125 222 924
1 Margaret Street Sydney NSW 2000
Australia Phone (61 2) 8299 8873
Fax (61 2) 9262 2885
www.apollominerals.com.au
PROGRESS AT MT OSCAR
KEY POINTS
• Exploration target1 of 350 to 650 million tonnes grading 30% to 37% in situ iron modelled for Apollo’s Mt Oscar Magnetite Project
• Metallurgical tests demonstrate >60% iron concentrate grades achievable
• Detailed geological mapping and sampling underway in preparation for strategic drilling, definitive petrography and metallurgical testwork
• Plan for another port near Mt Oscar (Port Anketell) announced by WA Premier
Mt Oscar Magnetite Project (100%)
During the quarter the company actively explored its Mt Oscar Magnetite Project, in the Pilbara Province of Western Australia. In addition to undertaking initial metallurgical testwork and commencing a detailed geological mapping program, the volume/tonnage modelled from aeromagnetic data was upgraded in light of the better than expected apparent thicknesses of magnetite‐bearing banded iron formation (“BIF”) encountered in recent drilling. Geological Mapping Encouraged by the results returned from the company’s maiden drilling program at Mt Oscar, Apollo has commissioned a detailed geological mapping program across the entire extent of the magnetite‐bearing BIF within its 100% owned exploration licence, E47/1379 (Figure 1). The geological mapping exercise, commissioned in early March, is scheduled to be completed in April 2010. It is being undertaken by a project geologist under the supervision of two senior geologists having, collectively, more than 30 years of iron ore experience.
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2 Overall the modelling exercises undertaken by SGC and subsequently revised by the results of the drilling program undertaken by the company at Mt Oscar, has provided tonnage estimates for the BIFs at Mt Oscar and Mt Oscar East that are considered to be possibly accurate to +/‐ 25%, however they should be considered accurate to +/‐ 50% for planning purposes, and to be broadly indicative at best. 2 www.apol lominera ls .com.au
The programme is being assisted by use of Innovx portable XRF, GPS and GIS systems. Comprehensive analysis of the results from this study will be integrated with other Project datasets, high‐resolution aerial photography, high‐resolution airborne geophysics (magnetic and radiometric), previous regional mapping studies, rock‐chip geochemical results and recent drilling results. This will facilitate planning and implementation of a strategic drilling program to generate samples for definitive petrography and metallurgical test work. As previously announced, key aspects of the Mt Oscar Magnetite Project include: • Significant cumulative drill intercepts near surface of :
o 192 metres @ 35.9% Fe in situ from 25m (OSCRC 001) o 271 metres @ 34.8% Fe in situ from 14m (OSRC 004)
• The outcropping nature of the BIF in prominent ridges up to 150 metres in height contribute to favourable mining parameters.
• Mineralisation open at depth, along strike, and in parallel structures Exploration Target Detailed forward and 3D magnetic models, generated in 2009 by independent geophysical consultants Southern Geoscience Consultants (“SGC”) from airborne magnetic data flown by Apollo over its Mt Oscar project area, have been revised to take account of the results of the company’s recently completed drilling program. This modelling was undertaken to assist in the ongoing exploration of the project, and to refine estimates1 of volume/tonnage of the highly magnetic BIF. The combined estimate1 over portions of Apollo’s licence (E47/1379 ‐ Mt Oscar) and the recently acquired Mt Oscar East (E47/1304) is an exploration target1 of 350 million tonnes (“Mt”) to 650Mt of magnetite‐bearing BIF, grading 31% to 37% iron in situ (See Table 1). This modelling is based on interpretation and modelling of geophysical data, rock‐chip sampling and the December 2009 RC drilling information from Mt Oscar, and geophysical data and rock‐chip sampling at Mt Oscar East. Table 1. Mt Oscar BIF Exploration Target1
Modelled Exploration Target Tonnage2
Apollo Prospects
Minimum (Mt)
Mid‐range
(Mt)
Maximum
(Mt)
Fe Grade
Mt Oscar BIF (100%) 300 400 500 31‐37% Mt Oscar East BIF (100%) 50 100 150 31‐37% Total 350 500 650 31‐37%
DTR and Metallurgical Testwork During the quarter Apollo announced Davis Tube Recovery (“DTR”) and metallurgical test work results which were undertaken by independent specialist engineers on composite samples obtained from the recent RC drilling program at the company’s Mt Oscar Magnetite Project (See Table 2).
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Davis Tube Recovery tests returned favourable concentrate results: • 23 metres grading 60.5% iron and 12.0% silica (OSRC001). • 28 metres grading 59.6% iron and 13.3% silica (OSRC005). • DTR mass recoveries averaged over 42% with 70% iron recovered, with broad magnetite horizons
returning up to 80.5% iron recovery from 49.1% of the mass (OSRC002). Further tests included fine grinding and DTR test work on samples, which yielded high grade magnetite concentrate of up to 64% iron (Fe) with Fe recoveries of up to 67.6%. Additional testwork, designed to further reduce silica, was undertaken on a composite sample from all five drill holes and produced concentrate grades of 61.6% Fe and 10.9% silica (SiO2). These results indicate that additional test work is warranted to further reduce SiO2 levels in order to meet normal blast furnace feed requirements. The company is confident that with further drilling and metallurgical testwork, lower silica levels and a saleable concentrate may be produced. The company is encouraged by these initial results and confirms that further strategic drilling, exploration and metallurgical test work at Mt Oscar is warranted. Regional Magnetite Activity Apollo’s Mt Oscar tenements cover magnetite‐rich BIF horizons of the Archaean Cleaverville Formation, which are known elsewhere in the region to host significant magnetite resources such as China Metallurgical Group Corporation’s Cape Lambert Magnetite Project (Indicated Resource of 979Mt grading 31.4% Fe and Inferred Resource of 577Mt grading 30.8% Fe for a combined Indicated and Inferred Resource of 1.56 billion tonnes grading 31.2% Fe) (see Figure 1). Fox Resources Limited have explored a portion of their adjacent magnetite project and reported an in situ Inferred Resource of 72.4Mt grading 34.02% Fe. Apollo’s Mt Oscar Magnetite Project has a number of significant advantages being very close to existing and planned port, rail and road infrastructure, in the vicinity of the Pilbara regional centre of Karratha. New Multi User Port Proposed at Anketell The existing Cape Lambert port is located just 25km from Mt Oscar. Recently, WA Premier Colin Barnett announced that a, new multi‐user port for iron ore exports is planned at Anketell (see Figure 1). Anketell is also only 25km from Mt Oscar project, and would potentially be used by Aquila Resources, Fortescue Metals and China Metallurgical Group. These companies have made undertakings to become foundation investors in the new precinct. The Premier stated that the Anketell site was first identified more than 40 years ago as suitable for a port with an export capacity of over 350Mt per annum. The WA Government will provide funding for planning and preparation of an Industrial Precinct Development Agreement for the port development. The Pilbara exported more than 326Mt of mainly iron ore in 2008‐2009, forecast to reach 530Mt per annum by 2005, and as much as 750Mt by 2020. The development of a new port at Anketell will be significant for Apollo as it’s Mt Oscar Magnetite Project is located in close proximity to the existing and proposed new port and rail potentially enhancing the project’s economic viability. Infrastructure costs for Mt Oscar are expected to be significantly less than other projects which are not as ideally located.
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Figure 1: Tenement Location Map
Figure 2: RC drillhole layout and results superimposed on colour aerial photograph.
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Commonwealth Hill Iron Project (100%) The company holds a 100% interest in four exploration licences in South Australia, located 700 km northwest of Adelaide adjacent to the Adelaide‐Darwin railway, covering 760 square kilometres, comprising the Commonwealth Hill Iron Project (Figure 3). Ground magnetic surveys and subsequent modelling carried out by an independent consulting geophysicist has identified eight anomalies prospective for iron mineralisation. Minor additional modelling is to be completed in order to accurately target drill holes to test the anomalies. The Sequoia Prospect is the most advanced of 4 known iron prospects, and 8 new magnetic anomalies identified within the licenses (Figure 4). The SA Geological Survey previously undertook ground magnetic surveys, drilled eight RC and one diamond hole and completed metallurgical testwork at Sequoia. The drilling discovered magnetite mineralisation in several steeply dipping laterally discontinuous magnetite‐BIF layers, from 2 to 50 metres wide below a weathering surface of around 45 metres. The metallurgical testwork undertaken by Amdel on drill samples reported concentrate grades averaging 70.3% Fe, 3.7% SiO2, 0.29% Al2O3 and less than 0.01% P2O5 with 88% Fe recovery from a head grade of 37.2% Fe, 41% SiO2, 1.36% Al2O3 and 0.18% P2O5. The final grind used was P80% < 63 microns.
Figure 3. Apollo’s Commonwealth Hill Project Area, showing locations of known iron prospects.
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Figure 4. Aeromagnetic anomalies selected for detailed ground magnetic and gravity surveys. Float mapping at the Ibis Prospect confirmed the presence of near‐surface magnetite‐rich metasediments similar to those observed at Sequoia. Interpretation of airborne and ground magnetic data acquired by earlier explorers indicates that the Ibis anomaly comprises a number of parallel bands of magnetic material, ranging in thickness from 20 m to 50 m, occurring discontinuously over a total strike length of 4 km.
Corporate
Recent news of an 80‐100% iron ore price increase has attracted renewed interest in Apollo’s iron ore projects. The company has continued to receive interest from overseas parties in participating in the Mt Oscar iron project which remains to be one of the few Pilbara iron projects wholly owned by an Australian ASX listed company.
On 23 February 2010 the company announced that it had obtained commitments for a placement raising a gross $1.2 million. These funds will be used for further exploration of Mt Oscar. Apollo thanks the continued support from its loyal shareholders in the ongoing development of the company’s projects.
A Research Report about Apollo’s magnetite projects has been published by Resource Capital Research Pty Ltd in their March Quarter 2010 edition of Iron Ore Company Review, and is available on the Apollo website: http://www.apollominerals.com.au/investor_relations/broker_reports.phtml
Guy Robertson Company Secretary
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Competent Person Declarations and qualifying statements
The information in this document that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Gavin Daneel, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Daneel has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Daneel, who is an officer of the company, consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The metallurgical information in this document is based on information compiled by Mr Damian Connelly, who is a Chartered Professional (MET) of The Australasian Institute of Mining and Metallurgy. Mr Connelly is a full‐time employee of Mineral Engineering Technical Services Pty Ltd. Mr Connelly has sufficient experience which is relevant to the style of iron ore mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Connelly consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. 1 The estimates of exploration target sizes mentioned in this release should not be misunderstood or misconstrued as estimates of Mineral Resources. The estimates of exploration target sizes are conceptual in nature and there has been insufficient results received from drilling completed to date to estimate a Mineral Resource compliant with the JORC Code (2004) guidelines. Furthermore, it is uncertain if further exploration will result in the determination of a Mineral Resource. 2 Overall the modelling exercises undertaken by SGC and subsequently revised by the results of the drilling program undertaken by the company at Mt Oscar, has provided tonnage estimates for the BIFs at Mt Oscar and Mt Oscar East that are considered to be possibly accurate to +/‐ 25%, however they should be considered accurate to +/‐ 50% for planning purposes, and to be broadly indicative at best.
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Table 2. Drilling Intercepts at Apollo’s Mt Oscar Magnetite Project.
Drillhole location details Apparent Intercept Head
Assays DTR Results
Hole_ID Easting Northing Azimuth/dip From To Interval Fe Mass Recovery
Conc Fe Conc SiO2 Conc Al2O3 Conc P Conc S Conc LOI
(MGA94) (MGA94) (degrees) (m) (m) (m) (%) (%) (%) (%) (%) (%) (%) (%)
OSRC001 520100 7687042 210o/‐60o 25 48 23 31.9 27.33 60.53 12.03 0.93 0.05 0.02 ‐1.49
OSRC001 51 87 36 34.6 42.10 55.80 18.07 1.07 0.03 0.02 ‐0.98
OSRC001 215 348 133 36.9 36.56 57.52 16.21 0.73 0.04 0.12 ‐1.51
OSRC002 519834 7686900 Vertical 83 99 16 34.6 37.93 58.37 14.75 0.75 0.06 0.17 ‐1.21
OSRC002 108 168 60 36.0 49.08 59.01 14.25 0.94 0.04 0.11 ‐1.65
OSRC003 519834 7686900 210o/‐55o 31 199 168 35.3 44.37 58.51 15.19 0.83 0.04 0.05 ‐1.65
OSRC004 520411 7686890 210o/‐60o 14 153 139 36.0 46.83 56.98 16.65 1.00 0.04 0.07 ‐1.42
OSRC004 163 188 25 34.9 42.44 58.01 14.85 1.21 0.04 0.01 ‐1.37
OSRC004 198 233 35 33.0 38.04 57.37 15.26 1.47 0.04 0.02 ‐1.06
OSRC004 247 266 19 32.5 34.17 58.62 14.49 1.18 0.04 0.02 ‐1.67
OSRC004 282 335 53 33.5 46.46 58.98 14.73 1.04 0.03 0.02 ‐1.76
OSRC005 520226 7686936 210o/‐60o 41 69 28 33.5 48.58 59.63 13.29 1.09 0.04 0.08 ‐1.77
Notes: 1) Sample intervals are based on 5 metre composites.
2) Each composite is individually tested by DTR, with all composite results averaged for the interval.
3) DTR head samples prepared to nominally 97% passing 38 micrometres.
4) Assays performed by ALS Laboratory Group (ALS Chemex) with chemical analysis by multi element X‐ray fluorescence spectrometry (XRF).
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CORPORATE DIRECTORY
Board of Directors Sevag Chalabian Non‐Executive Chairman Tony Ho Non‐Executive Director Wang Jianguang Non‐Executive Director Company Secretary & Chief Financial Officer Guy Robertson Shares on Issue As at 31 March 2010 the Company had 117,856,743 ordinary shares on issue.
Registered Office Apollo Minerals Limited Level 10, 1 Margaret Street Sydney NSW 2000 Australia Phone (61 2) 9299 8873 Fax (61 2) 9262 2885 www.apollominerals.com.au
Share Registry Security Transfer Registrars Pty Limited 770 Canning Highway Applecross WA 6153 Australia Phone (61 8) 9315 2333 Fax (61 8) 9315 2233 www.securitytransfer.com.au
Please direct shareholding enquiries to the share registry
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