After recently delivering strong drill results up to 56.1% Fe near surface at its Roper River Iron Ore Project in the Northern Territory, Sherwin Iron (ASX:SHD) has unveiled a maiden W Deposit JORC compliant resource estimate of 70 Mt at an average of 48% Fe.
Importantly, Sherwin's project has access to the Adelaide-Darwin railway line 95-105km to the east and capacity available at Darwin Port, approximately 400km to the north.
The resource estimate puts the company on track for an initial production rate of 2Mtpa rising to 5Mtpa commencing in 2012, and results support Sherwins’s exploration target for Hodgson Downs of 80-150Mt at 50-60% Fe.
Significantly, this maiden JORC resource estimate was achieved only from W Deposit within the Hodgson Downs series of deposits at the project and does not yet include all of the W Deposit drilling.
Resource modelling by SRK Consulting includes a significant Indicated Resource component of 26Mt at over 49% Fe.
Greg Bittar, chief executive, said the maiden W Deposit JORC resource provides further evidence that Sherwin and the Roper River Iron Ore Project is poised to become one of the next substantial iron ore producers in Australia.
“This shows Roper River Iron Ore Project has the resource to underpin an initial 2-5Mt pa operation starting in 2012,” Bittar said.
“Our maiden resource estimate will be increased as more results flow in from drilling at X Deposit and the other deposits within the Hodgson Downs area."
“With the new management team in place, access to railway line and capacity available at Darwin Port, we are fast assembling all the key pieces needed to establish a significant iron ore operation.”
The Maiden W Deposit JORC resource estimate based on the majority of drilling at W Deposit and further revisions are expected as further W Deposit assays are included in resource modelling.
Further results from drilling at W Deposit and others deposits within the Hodgson Downs prospects are expected to underpin a series of significant upgrades to the total Hodgson Downs resource during the 4Qtr of 2010.
Initial metallurgy tests show excellent upgrade potential, achieving 58% Fe through low-cost crushing and gravity separation with refinements. Further processing is expected to deliver circa 60% Fe and a highly saleable product.
Metallurgical testing on 40%+ Fe samples demonstrates excellent upgrade potential and a scoping study to be released shortly, outlining development costs and rail and port options for start-up production from Hodgson Downs.
The Sherwin Creek / Mount Scott exploration target of 300-400Mt is to be drill tested in 2011. The drilling program involving both RC and diamond drill rigs continues.
Sherwin, formerly Batavia Mining, believes that the enormous exploration potential at both Hodgson Downs and elsewhere within the Project provides strong scope to support a much greater long-term production level.
A scoping study reviewing initial production from the Hodgson Downs area of the Project is substantially complete and is expected to be released shortly. This will outline development costs and infrastructure, including rail and port alternatives.
Metallurgical testwork to-date has included crushing, screening and heavy liquid separation tests on 40%+ Fe and 50%+ Fe bulk samples. This testwork demonstrated the production of high grade Fe product (up to approximately 60% Fe and less than 10% silica) with low levels of impurities.
These results were achieved with 80%+ mass recoveries. Further metallurgical testing will be conducted on diamond PQ triple tube samples now being drilled.