Brisbane-based minerals explorer, Diatreme Resources Ltd, has announced a potential billion-dollar discovery of zircon at the company's Cyclone Prospect in the Eucla Basin in Western Australia.
Brisbane-based minerals explorer, Diatreme Resources Ltd, has announced a potential billion-dollar discovery of zircon at the company's Cyclone Prospect in the Eucla Basin in Western Australia.
The find has an estimated inferred resource of 60 million tonnes grading 3.1 per cent heavy minerals, yielding 1.8 million tonnes HM.
Executive chairman Tony Fawdon claimed the resource was of a significant size on a global scale, being comparable with Iluka Resources' Ambrosia resource located in the eastern Eucla Basin.
Mr Fawdon said the potential billion-dollar discovery could form a major new mineral province for WA.
Members of the area's traditional owners in both WA (the Pila Nguru Spinifex People) and South Australia (the Maralinga Tjarutja People) contributed to the discovery, being involved in both cultural heritage surveys and the construction of access tracks.
"From the initial discovery at the end of June 2007, Diatreme Resources has within just seven months outlined a major zircon-rich resource with significant potential for expansion," Mr Fawdon said.
"Located in the Western Australian area of the Eucla Basin, the deposit has an attractive suite of minerals, with an indicated mineral assemblage of 41 per cent zircon, 42 per cent leucoxene, 10 per cent ilmenite and 3 per cent rutile."
Current average prices of zircon - used in ceramics, computer screens and other applications - are approximately $833 per tonne, with rutile at $555 per tonne and leucoxene at $422 per tonne, with ilmenite around $88/tonne.
"Drilling in 2007 has shown that there is excellent potential to increase the resource, which is open-ended to the north and has a major beach dune system located to the east carrying HM sands near surface."
Mr Fawdon said the frontier exploration conducted by the company had identified a number of heavy mineral strand systems covering an area located within 25 kilometres of the South Australian border and 220 kilometres north of the transcontinental railway.
"Diatreme has only explored a very small percentage of the 1,500 kilometre basin, and is the first to drill within the central 600 kilometre area. The nearest drilling has been conducted at the company's Willy Willy Prospect in South Australia, around 200 kilometres to the east," Mr Fawdon said.
"The discovery is a major boost for Western Australia's mineral sands industry and could become a new mining province with the establishment of the appropriate infrastructure to the area."
The company plans to conduct further aircore drilling at the Cyclone Prospect after completing a drilling program at the Willy Willy Prospect planned for April 2008, Mr Fawdon said.
"Diatreme has an aggressive $8 million exploration and evaluation budget for calendar 2008, which will be amply funded by current cash reserves of $9.7 million," he said.
"We're confident about increasing the resource at the Cyclone and Willy Willy Prospects, in addition to increasing the copper resources at the Clermont Copper Project in Queensland, where a new major drilling program is planned for the Peak Downs Prospect.
"With an existing resource of 30,000 tonnes of copper metal at Peak Downs on top of 1.8 million tonnes of heavy minerals at Cyclone, the outlook is extremely strong for significant growth in shareholder value."
Diatreme shares closed down 2 cents, or 12.9 per cent, to 13 cents each today.
