| Thu 7 Oct 2010, 8:00 | | AEA - African Eagle Resources plc - Resource update at Dutwa Nickel Project |
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AEA
AEA
AEA - African Eagle Resources plc - Resource update at Dutwa Nickel Project
and progress report on pre-feasibility work
African Eagle Resources plc
Incorporated in England and Wales
(Registration number 3912362)
(AIM share code: AFE AIM ISIN: GB0003394813)
(JSE share code: AEA JSE ISIN: GB0003394813)
RESOURCE UPDATE AT DUTWA NICKEL PROJECT AND PROGRESS REPORT ON PRE-
FEASIBILITY WORK
African Eagle Resources plc (AIM: AFE; AltX AEA) announces an important
resource update, now received from independent geological contractor Snowden
Mining Industry Consultants, and continuing progress on the pre-feasibility
work at the Company`s Dutwa nickel project in Tanzania.
Highlights of the updated resource statement:
13% increase to 917kt in contained nickel metal of the JORC inferred
resource at Dutwa Project.
6% increase in average Ni grade to 0.93% Ni and 4% increase to 0.96% in
nickel equivalent grade after cobalt credits.
Resources in each different ore type delineated for the first time.
Potential for a further 8-10 million tonnes of ore at Ngasamo.
Highlights of the ongoing pre-feasibility work:
Drilling for the bulk ore sample is ahead of schedule.
Whittle optimisation and revision of project economics is now underway.
Comprehensive, second-stage metallurgical testwork on the bulk sample
expected to commence in December.
African Eagle`s Managing Director Mark Parker comments:
"Both the tonnage and the grade of the Dutwa resource have increased in this
latest resource statement. Geostatistical block modelling gives a more
sophisticated deposit model than the polygonal method used for the estimate
which we announced in June.
The resource block model is now being used for Whittle pit optimisation, the
results of which will be employed in financial modelling to update the
scoping study economics later this year.
Meanwhile, we are ahead of schedule on our drilling programme to obtain
representative bulk ore samples from the Wamangola and Ngasamo deposits for
metallurgical tests."
RESOURCE UPGRADE
The updated JORC Inferred resource for the Dutwa Project increases the
Mineral Resource to 98.6 million tonnes at 0.93% nickel, with 917,000 tonnes
contained nickel metal (see table below for full disclosure). The new
deposit model is a significant step for the Company and for the development
of the Dutwa Project as it is the first time that the resources in the
different ore types have been delineated- an important step in mine
planning.
The three ore type domains, Ferruginous/siliceous (FerSil), Transitional
(Trans) and Saprolite (Sap) were determined from the geological logging and
the geochemical assays. The new model also provides estimates of the
concentrations of silica, iron, magnesium and aluminium in each ore domain,
which have important implications for the deposit`s process metallurgy.
Snowden also extrapolated the mineralisation at Ngasamo to the south, where
the steep slope has so far prevented reverse circulation drilling. This
showed the potential for a further 8-10 Mt of mineralised material grading
at 0.9% to 1.1% Ni, defined as an Exploration Target under JORC 2004
guidelines and therefore not included in the JORC resource. The Company is
designing a programme to drill test this area, and although the Exploration
Target is conceptual in nature and there is hence no guarantee that further
exploration will result in the definition of a Mineral Resource, the Company
is confident that further resources will be identified.
Snowden performed the work for the updated Mineral Resource statement with
Datamine software, using ordinary block kriging with unfolding. Drillhole
assay data were composited over sample intervals of three metres. The
resource was extrapolated up to 50m beyond the edge of the drilling. The
Mineral Resource has been classified in its entirety as an Inferred
Resource, based on the guidelines of the 2004 JORC Code.
DUTWA PRE-FEASIBILITY
The block model was generated by Snowden for a preliminary Whittle pit
optimisation study which is expected to be completed soon and will provide
provisional grade and tonnage schedules for use in a new financial model.
African Eagle has commissioned Simulus, a Perth based engineering company,
to develop the economic model as part of its pre-feasibility (PFS) study on
Dutwa. Simulus specialises in dynamic process model simulation and has a
reputation as a world leader in nickel laterite economics and process
design.
The first iteration of the economic model, expected to be completed before
the end of 2010, will be an update of the scoping study economics and will
incorporate the considerable improvements in data and knowledge which have
been amassed since completion of the initial scoping study in 2009. These
include: the greatly increased resource; the exceptional column leach test
results; better data on transport options and reagent sources; and improved
meteorological information. The economic model will be iteratively refined
throughout the feasibility work.
The Company`s diamond drilling programme to obtain a representative bulk ore
sample for metallurgical tests is ahead of schedule, with 13 of the 30
planned priority drillholes completed for 600m, yielding almost six tonnes
of core. African Eagle expects to ship about 10 tonnes of selected
mineralised core from the priority holes to Perth, Western Australia, during
November, for the metallurgical and geotechnical testwork programmes.
Table: Dutwa Inferred Mineral Resource statement, as at October 2010,
reported above a 0.43% eNi cut-off grade
Tonnag Grade Contain Major oxide chemistry1 %
e ed
Mt Ni % Co % eNi2 eNi kt SiO2 Al2O3 Fe2O3 MgO
%
Wamango
la
FerSil 42.9 0.88 0.03 0.92 395 73.41 2.58 12.11 3.76
Trans 14.9 0.96 0.02 0.99 148 54.29 2.09 12.34 16.72
Sap 2.5 0.95 0.02 0.98 25 35.40 0.37 7.41 34.54
Bedrock 0.1 0.91 0.01 0.92 1 33.38 0.17 7.02 41.16
WA 60.4 0.90 0.02 0.93 562 67.03 2.36 11.96 8.32
TOTAL
Ngasamo
FerSil 19.0 0.90 0.04 0.95 181 73.85 1.94 12.58 4.98
Trans 12.5 1.07 0.03 1.11 139 59.71 1.50 14.04 13.91
Sap 6.7 0.98 0.04 1.03 69 39.11 0.63 16.02 26.02
Bedrock 0.02 0.62 0.01 0.63 0 39.70 0.17 7.94 35.91
NG 38.2 0.97 0.03 1.01 386 63.11 1.56 13.66 11.61
TOTAL
GLOBAL 98.6 0.93 0.02 0.96 948 65.51 2.05 12.62 9.59
TOTAL
1 Key elements of metallurgical importance, expressed as oxides. The very
high silica concentrations are a benefit for heap leaching while the low
aluminium, iron and magnesium concentrations help explain the low acid
consumption during leaching.
2 eNi % = Ni % + (Co % x 1.32); based on US$10/lb Ni and US$17/lb Co,
with recoveries of 90% for Ni and 70% for Co.
Qualified Person
Information in this report relating to Mineral Resources is based on work
completed by Richard Sulway BSc, MAppSc, MAusIMM (CP). Richard Sulway is a
member of the Australasian Institute of Mining and Metallurgy (MAusIMM) and
has sufficient experience which is relevant to the style of mineralisation
and type of deposit under consideration and to the activity to 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" (the JORC Code). Richard Sulway is a full-time
employee of Snowden Mining Industry Consultants Pty Ltd. Richard Sulway
consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears
Information in this report relating to exploration results is based on data
reviewed by Mr Christopher Davies BSc, MSc, DIC, FSEG, FAusIMM, Operations
Director for African Eagle, who is a Fellow of the Australasian Institute of
Mining and Metallurgy, has more than 27 years` relevant experience in
mineral exploration, and is a Qualified Person under AIM rules. Mr Davies
consents to the inclusion of the information in the form and context in
which it appears.
Technical terms
A glossary of technical terms used by African Eagle in this announcement and
other published material may be found at
www.africaneagle.co.uk/p/glossary.asp
Sponsor
Merchantec Capital
7 October 2010
For further information:
Mark Parker
Managing Director
African Eagle
+44 20 7248 6059
+44 77 5640 6899
Nicola Marrin
Seymour Pierce Limited, London
Nominated Adviser
+ 44 20 7107 8000
David Banks
Seymour Pierce Limited, London
Corporate Broking
+ 44 20 7107 8000
Guy Wilkes
Ocean Equities Limited
+44 20 7786 4370
Charmane Russell
Russell & Associates, Johannesburg
+ 27 11 8803924
+27 82 8928052
Ed Portman / Leesa Peters
Conduit PR, London
+44 20 7429 6607
+44 77 3336 3501
About African Eagle
African Eagle is currently developing the major Dutwa nickel laterite in
Tanzania. The Company discovered Dutwa in 2008, completed a scoping study on
in June 2009, and is now conducting a feasibility study. The deposit now
contains an Inferred Resource (JORC 2004) of 98.6 Mt at 0.93% nickel.
Initial metallurgical work indicates that the laterite will be able to be
processed with standard heap leaching and no need for a costly HPAL
facility. African Eagle is also evaluating a second promising nickel
laterite deposit at Zanzui in Tanzania, 50km south of Dutwa which is
currently in the drilling and testing phase.
In December 2008, African Eagle resolved to prioritise the Dutwa project,
because the Board believes that, of all the Company`s projects, it offered
the greatest potential to add value. To take its other discoveries into
production, African Eagle is seeking industry partners with records of
successful mine development, by means of joint ventures, farm-ins, spin-outs
or other mechanisms. These include: a 49% interest in the Mkushi Copper
Mines joint venture project in Zambia, for which a draft feasibility study
was completed in Q4 2008; the Miyabi gold project in Tanzania which has a
half a million ounce JORC gold resource; the Ndola and Mokambo projects in
the Zambian Copperbelt; and the Igurubi gold project in Tanzania.
Zambia, Tanzania and Mozambique, the sites of African Eagle`s projects, are
all countries which have highly prospective geology, relatively low above-
ground risks and track records of successful major investments in the metals
and minerals industries.
Date: 07/10/2010 08:00:03 Produced by the JSE SENS Department.
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