WA magnetite project shaping up for Reedy Lagoon
A recent technical report on Reedy Lagoon’s Burracoppin magnetite project located near Merredin, WA, has outlined the potential of the iron ores to be upgraded into a high-grade concentrate with low impurities at coarse grain size.
The company said that this makes the product desirable as a potential feed material for the commercial HIsmelt technology, which is an alternative to conventional steel-making practices, that are generally harmful to the environment and costly to run.
HIsmelt is a commercial direct smelting process for producing iron metal straight from ore by injecting high-grade iron ores and non-coking coals into a molten bath of iron, which can then produce a high-quality molten “pig” iron for fabrication.
It is considered a potential future replacement process for traditional blast furnace technology and has lower operating costs, lower capital intensity and more importantly, lower environmental impacts that are in line with changing environmental regulations worldwide.
Previous studies have shown that the coarse magnetite iron ores from Reedy’s Burracoppin project are easily upgraded into a concentrate with a grade of between 67% to 70% iron and low levels of impurities like alumina and phosphorus, at a relatively coarse grind size of 150 microns.
High-grade iron ores command a premium price above run-of-mine 62% iron ore fines, which are currently trading near USD$90 per tonne into China, about 25% below the recent highs reached in July.
By comparison, “finished” pig iron currently sells at prices closer to USD$240 per tonne.
Moving forward, it is the quality of the delivered iron ores in terms of grade and low impurities that is the future driver of the steel-making industry globally, particularly as environmental guidelines tighten further.
Therefore, premiums will continue to be paid for high-quality iron ores as more high-grade deposits are depleted and emission restrictions increase.
And this is where high-grade magnetite concentrate products, like those generated from the company’s Burracoppin magnetite project come into their own.
Reedy discovered Burracoppin in 2012 and had a JV agreement with Canadian-listed Cliffs Resources over the project, before the ground was relinquished in 2016, due to the low prevailing iron ore prices at the time.
The company subsequently lodged a new exploration licence application over the same deposit in 2017 and was granted the licence in February this year, just as iron ore prices started to ascend again.
The Burracoppin magnetite deposit is defined by a sizeable magnetic anomaly measuring 3,000 metres long and is adjacent to rail infrastructure connecting to bulk cargo ports at Fremantle and Esperance.
It does not yet contain a JORC-compliant mineral resource, but Reedy intends to rectify this soon with additional drilling as a first step in commencing investigations into the project’s future economic viability.
Historical drilling during the JV-phase intersected steeply dipping magnetite-bearing units forming bands with combined horizontal widths of between 150 metres and 200 metres within an envelope of between 200 metres and 320 metres horizontal width.
The positive result regarding the potential suitability of the Burracoppin iron ores as a primary feed product for HIsmelt technology is a big tick in the box for Reedy, which now has a clear path ahead to commence developing the project with real confidence towards an endgame.
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