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Afferro Mining Inc. is an iron ore exploration and development company listed on TSX-V and AIM, with just under 1,000km2 of exploration permits in the south of Cameroon, all along proposed infrastructure in a rapidly developing iron ore district. The management has a strong track record in the discovery and development of commercial...Read more
UPDATE: Afferro reveals encouraging results from Cameroon prospectOctober 24 2012, 12:31pm
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They include an 11 metre section from surface at 61.1% iron, 8.8 metres at 54.6% Fe and 28 metres at 45.6% Fe.
In all 33 diamond drill holes have been sunk in this latest programme for a total of almost 1,800 metres.
It has located a one kilometre mineralised strike zone, which remains open at depth.
Afferro chief executive Luis da Silva said: “Drilling results at Ngoa are encouraging with multiple intersections from surface above 40 per cent Fe and a number of down-hole length intersections in excess of 55 per cent Fe.
“We believe Ngoa can become a satellite resource to support scalable mining of up to 35 million tonnes per year at Nkout, which is situated less than five kilometres to the north of Ngoa.
“The recent preliminary economic assessment showed Nkout to be a robust project; additional high grade resources at Ngoa will enhance the already attractive economics.”
The Ngoa prospect lies within the Essong exploration permit and is next to the company’s existing Nkout iron ore project, which in turn is 20 kilometres from the proposed south Cameroon rail corridor.
Broker Investec added that while Ngoa is still an early stage target today’s news was encouraging and could lead to a satellite resource to the principal Nkout project which has a 1.2bn tonne resource at 32.9% Fe.
Afferro’s PEA on Nkout outlines a number of attractive scenarios, while the metallurgical work demonstrated a relatively coarse grind (75microns) size compared with other projects, which would reduce expected power requirements, as well as porducing a high grade product of up to 70% Fe.
The broker adds that Afferro’s share price has been boosted by the takeover of Sundance Resources.
“Sundance’s Mbalam project will require the development of the South Cameroon rail corridor that goes straight through Afferro’s Nkout and Essong tenements which will make it much easier and more attractive to develop Afferro’s project.”
Furthermore, Afferro is well financed with US$51m cash in the bank (at end June) and a further minimum US$50m callable from July 2013.
Investec has a 107p share price target and ‘buy’ recommendation.
Shares were down 1p at 62p.