Name and Location
Fusion magnetite project, Australia.

Client
Eyre Iron Magnetite Joint Venture (JV), comprising Centrex Metals and Wuhan Iron & Steel Co (Wisco).

Project Description
The Fusion project comprises a 50-km-long magnetic banded iron formation on the Southern Eyre peninsula, in South Australia. To date, the project has established 680-million tonnes of mineral resources at the deposits of Koppio, Brennand, Kapperna and Iron Mount, which collectively represent about 14 km of the overall magnetic trend.

The project revolves around numerous satellite magnetite ore deposits feeding into a centralised processing facility to produce a magnetite concentrate.

It is planned that the concentrate will be transported through a 40 km slurry pipe to the proposed Port Spencer export facility, also being developed by Cemtrex and Wisco.

Value
Not stated.

Duration
Not stated.

Latest Developments
Drilling at the Fusion project under the Eyre Iron Magnetite JV will be delayed while the JV awaits further land access.

A major drill programme started in December 2013 to drill out new deposits adjacent to the JV’s existing 680-million-tonne mineral resources. Additional resources defined at the new deposits will form the basis of an expanded prefeasibility study (PFS) focusing mostly on mine design, with the current process plant, logistics and infrastructure designs remaining largely unaltered.

The JV agreed to start the exploration of additional deposits within the Fusion project area to reduce the required mining depths for the initial mining life and lower the estimated production costs and, therefore, increase project returns, creating greater investment certainty given recent iron-ore price fluctuations.

Since drilling for the expanded PFS started in December, 16 drill holes have been completed west of the existing Koppio deposit and at the Bald Hill deposit.

Bald Hill is the focus of the drilling programme, with the deposit comprising an estimated 9-km-long magnetic trend adjacent to the existing Fusion mineral resources.

Drilling results at the deposit have confirmed the presence of magnetite banded iron formations, similar to those forming the project’s current resources.

While access for exploration drilling has been acquired in some areas of Bald Hill, agreements have yet to be reached on several other areas.

Negotiations have been ongoing for more than six months and mediation has also been attempted.

However, despite all efforts to reach a commercial agreement, the only way forward for the JV is to refer access for determination under the South Australian Mining Act.

The access sought is for exploration drilling only and does not form part of any mining lease application.

The process for a determination is relatively clear; however, the timeframe is not and it could take several months to provide a result.

This will impact directly on the overall schedule for the expanded PFS, as drilling forms a critical line item for the project.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Centrex Metals, tel +61 8 8100 2200 or fax +61 8 8232 0500.
Wisco, tel +86 27 86891000.