Metallurgical Bench Scale Testing Program Demonstrates High Weight and Iron Recovery From Gravity-Only Process at Hopes Advance
April 25 2012 - 8:00AM
Marketwired Canada
Oceanic Iron Ore Corp. (TSX VENTURE:FEO)(OTCQX:FEOVF) (the "Company") is pleased
to announce the results of the comprehensive metallurgical bench scale testing
program undertaken by SGS Mineral Services Lakefield ("SGS") in respect of the
Hopes Advance project.
Highlights
-- Metallurgical test work demonstrates that an average 66.5% grade
concentrate suitable for the production of pellets or sinter feed, at
high weight and Fe recoveries, with low deleterious elements can be
produced from deposits at Hopes Advance;
-- The quality and liberation characteristics of Fe offer flexibility in
flowsheet design;
-- A single stage gravity-alone circuit could recover relatively coarse
grained material at greater than 70% Fe recovery across 91% of the
Measured and Indicated Fe resource (approximately 1.2bn tonnes) at Hopes
Advance, supporting potentially 25 year production scenario;
-- Significant potential reduction in both processing costs per tonne and
capital cost for a gravity-alone circuit, when compared to a
concentrating plant consisting of a gravity circuit followed by
regrinding and magnetic concentration;
-- Flexibility to add regrinding and magnetic concentration to maximize
iron recoveries subject to a marginal economic benefits analysis;
-- Pilot plant test work (now underway and expected to be completed in the
summer of 2012) is designed to confirm the viability of the
concentrating methods at plant scale;
-- All scenarios will be further analyzed in the pre-feasibility study
currently underway and targeted for completion in Q3 2012.
Steven Dean, Chairman and CEO of Oceanic, noted: "We have deliberately
front-ended our analysis of the metallurgical testwork of the Hopes Advance
project in order to continue the fast-track development of the project. The
results we are announcing today help to support our view that the deposits at
Hopes Advance are the most desirable of those in the Labrador Trough given the
flexibility they offer in terms of plant design, and the resulting advantages in
terms of operating and capital costs over and above what was set out in the
Company's Preliminary Economic Assessment released in November 2011. We expect
the pilot plant testwork that has already commenced on the Hopes Advance project
to further validate the conclusions reached through the composite testwork and
further support the assertion that the Hopes Advance project has the potential
to be one of the lowest operating cost iron projects globally."
Background
Over the last twelve months, the Company has focused on advancing the Hopes
Advance project, including the completion of a comprehensive metallurgical bench
scale testing program designed to:
1. Provide weight recovery and concentrate quality data on composite
samples from the Hopes Advance deposits; and,
2. Develop a process flowsheet.
Some 611 composite samples from the various deposits at Hopes Advance were
analyzed by SGS. SGS designed comprehensive bench scale metallurgical testing
program to simulate a concentrating plant composed of a gravity circuit,
followed by regrinding and a magnetic circuit.
Overview of Metallurgical Tests
The gravity circuit was simulated by a single stage of grinding to 80% passing
150 mesh (106 micron) followed by gravity recovery using a Mozley Table. This
stage recovered relatively coarse grained hematite and aggregates of magnetite
and hematite.
The regrinding and magnetic circuit was simulated using David Tube testing.
Davis Tubes were run on Mozley Table tails when normalized Fe Recovery was less
than 70% and magnetite content of a sample (Head Sat / Satmagan) was greater
than 15%. The tailings were then ground to 100% passing 400 mesh and passed
through a Davis Tube to recover the magnetite. The concentrate from the Mozley
Table test and the Davis Tube test were combined to produce a total concentrate
weight recovery and concentrate grade.
Metallurgical Test Results
Table 1 summarizes the concentrate grade and weight recoveries resulting from
the gravity recovery (Mozley Table) analyses. The testing was designed to
achieve a concentrate with a grade of 4.5 wt.% SiO2, which is the current market
accepted specification for iron concentrates for iron ore pellets.
Table 1. Gravity recovery (Mozley Table) Concentrate Grade and Recovery (at 4.5%
SiO2)
----------------------------------------------------------------------------
Weighted Average
-----------------------------------------------------------
Head Grade Conc. Grade Fe Recovery
Deposit Fe Sat Fe SiO2 %
----------------------------------------------------------------------------
Iron Valley 33.2 12.5 66.05 4.50 77.01
Castle Mountain 32.8 15.0 65.78 4.50 75.68
Bay Zone 33.0 27.8 66.83 4.50 71.35
----------------------------------------------------------------------------
West Zone 34.0 19.9 65.44 4.50 64.98
----------------------------------------------------------------------------
Deposits at Castle Mountain, Iron Valley, and Bay Zone, where Fe recovery is
greater than 70% ("High Gravity Recovery Deposits") as illustrated above,
comprise over 91% of the total Hopes Advance Measured and Indicated resource
(approximately 1.2bn tonnes), as set out in Table 2 below.
Table 2. Measured and Indicated In-Pit Mineral Resource for High Gravity
Recovery Deposits
----------------------------------------------------------------------------
Fe WRCP Resource Concentrate
Deposit Classification (%) (%) Tonnes Tonnes
----------------------------------------------------------------------------
Castle Mountain Measured 32.0 38.4 328,091,000 125,934,000
Castle Mountain Indicated 31.5 37.8 172,108,000 65,011,000
----------------------------------------------------------------------------
Castle Mountain M+I 31.8 38.2 500,199,000 190,945,000
----------------------------------------------------------------------------
Iron Valley Measured 33.9 41.0 65,427,000 26,843,000
Iron Valley Indicated 33.5 40.4 121,897,000 49,288,000
----------------------------------------------------------------------------
Iron Valley M+I 33.6 40.6 187,324,000 76,131,000
----------------------------------------------------------------------------
Bay Zone Measured 32.4 39.1 259,279,000 101,387,000
Bay Zone Indicated 32.1 38.6 211,022,000 81,508,000
----------------------------------------------------------------------------
Bay Zone M+I 32.3 38.9 470,301,000 182,895,000
----------------------------------------------------------------------------
All HGR Measured 32.3 38.9 652,797,000 254,164,000
All HGR Indicated 32.2 38.8 505,027,000 195,807,000
----------------------------------------------------------------------------
All HGR M+I 32.3 38.9 1,157,824,000 449,971,000
Total M+I 32.3 38.7 1,268,000,000 491,322,000
----------------------------------------------------------------------------
As noted above, Davis Tubes were run on Mozley Table tails when normalized Fe
recovery was less than 70% and magnetite content of a sample (Head Sat /
Satmagan) was greater than 15%. Table 3 below shows the overall recovery
achieved by combining the gravity concentrate and the magnetic concentrate while
maintaining approximately 4.5% SiO2.
Table 3. Summary of Overall Concentrate Grade (at 4.5% SiO2)
----------------------------------------------------------------------------
Overall Concentrate Grade Overall Recovery
Fe SiO2 Al2O3 Sat MnO Wt Fe SiO2 Sat
Deposit % % % % % % % % %
----------------------------------------------------------------------------
Bay Zone 66.96 4.46 0.03 59.15 0.28 40.08 81.01 4.38 81.06
Iron Valley 65.97 4.64 0.04 25.48 0.33 40.49 80.58 4.76 62.92
Castle Mountain 65.87 4.42 0.02 30.84 0.33 39.34 78.60 4.34 73.97
West Zone 65.81 4.34 0.03 41.28 0.73 38.80 74.58 4.40 72.50
----------------------------------------------------------------------------
Combined recovery methods at the High Gravity Recovery Deposits (Bay Zone, Iron
Valley and Castle Mountain) achieved weight recoveries and Fe recoveries above
or approaching 40% and 80% respectively.
Implications on Plant Design and Costs
Metallurgical test work indicates that an average 66.5% grade concentrate
suitable for the production of pellets or sinter feed, at high weight and Fe
recoveries, with low deleterious elements can be produced via gravity only from
the Castle Mountain, Iron Valley and Bay Zone deposits.
As highlighted in Table 2, these deposits have a combined measured and indicated
resource of approximately 1.2 billion tonnes and could support a 20 million
tonne gravity only concentration operation for approximately 25 years. The
Castle Mountain and Iron Valley Deposits alone have a combined measured and
indicated resource of approximately 688 million tonnes (see Table 2) and could
support a 20 million tonne simple gravity concentration process operation for
approximately 13 years. As stated in the recent press release dated April 2,
2012, the Castle Mountain deposit in particular has considerable expansion
potential to the north east, which is expected to be further evaluated in the
2012 drilling program.
The Company also has the flexibility to commence production on a staged basis
with an initial production target of 8 to 10 million tonnes per annum Fe
concentrate focused on these deposits, using only a gravity circuit, with the
expectation that the initial capital costs of the Hopes Advance project will
reduce significantly. Production could then be increased to 15 to 20 million
tonnes per annum, still only utilizing a gravity recovery process. The use of a
gravity only circuit is also expected to significantly reduce the Company's
processing costs per tonne.
A magnetic concentrating circuit could be added at a later date to maximize iron
recoveries subject to a marginal economic benefits analysis.
These scenarios will be further analysed in the pre-feasibility study currently
underway and targeted for completion in Q3 2012.
Summary
The iron ore at Hopes Advance is unique in its structural simplicity and low
variability. The ore zones also appear to be largely free of internal waste. The
iron formation dips shallowly and can be mined with a very low stripping ratio.
The metallurgical characteristics of Hopes Advance iron ore have low variability
suggesting concentrating plant operations will be smooth and will not require
ore blending for plant performance. These characteristics combine to create an
iron ore deposit with predicted low operating costs, flexible mining, and ease
and simplicity of concentrating plant operation.
Eddy Canova, P.Geo., Director of Exploration for the Company and a Qualified
Person as defined by NI 43-101, has reviewed and is responsible for the
technical information contained in this news release.
OCEANIC IRON ORE CORP. (www.oceanicironore.com)
On behalf of the Board of Directors
Steven Dean, Chairman and Chief Executive Officer
This news release includes certain "Forward-Looking Statements" as that term is
used in applicable securities law. All statements included herein, other than
statements of historical fact, including, without limitation, statements
regarding potential mineralization and resources, exploration results, and
future plans and objectives of Oceanic Iron Ore Corp. ("Oceanic", or the
"Company"), are forward-looking statements that involve various risks and
uncertainties. In certain cases, forward-looking statements can be identified by
the use of words such as "plans", "expects" or "does not expect", "scheduled",
"believes", or variations of such words and phrases or statements that certain
actions, events or results "potentially", "may", "could", "would", "might" or
"will" be taken, occur or be achieved. There can be no assurance that such
statements will prove to be accurate, and actual results could differ materially
from those expressed or implied by such statements. Forward-looking statements
are based on certain assumptions that management believes are reasonable at the
time they are made.
In making the forward-looking statements in this presentation, the Company has
applied several material assumptions, including, but not limited to, the
assumption that: (1) there being no significant disruptions affecting
operations, whether due to labour/supply disruptions, damage to equipment or
otherwise; (2) permitting, development, expansion and power supply proceeding on
a basis consistent with the Company's current expectations; (3) certain price
assumptions for iron ore; (4) prices for availability of natural gas, fuel oil,
electricity, parts and equipment and other key supplies remaining consistent
with current levels; (5) the accuracy of current mineral resource estimates on
the Company's property; and (6) labour and material costs increasing on a basis
consistent with the Company's current expectations. Important factors that could
cause actual results to differ materially from the Company's expectations are
disclosed under the heading "Risk Factors" in the Company's Filing Statement
dated November 22, 2010 (a copy of which is publicly available on SEDAR at
www.sedar.com under the Company's profile) and elsewhere in documents filed from
time to time, including MD&A, with the Toronto Stock Exchange and other
regulatory authorities. Such factors include, among others, risks related to the
ability of the Company to obtain necessary financing and adequate insurance; the
economy generally; fluctuations in the currency markets; fluctuations in the
spot and forward price of iron ore or certain other commodities (e.g., diesel
fuel and electricity); changes in interest rates; disruption to the credit
markets and delays in obtaining financing; the possibility of cost overruns or
unanticipated expenses; employee relations. Accordingly, readers are advised not
to place undue reliance on Forward-Looking Statements. Except as required under
applicable securities legislation, the Company undertakes no obligation to
publicly update or revise Forward-Looking Statements, whether as a result of new
information, future events or otherwise.
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