Sunday, 19 February 2012

Aurium Resources: drills 29m at 62.8% iron and delivers DSO mineralisation at Telecom Hill

Aurium Resources (ASX: AGU) and joint venture partner Padbury Mining (ASX: PDY) have delivered to the market a confirmation of direct shipping ore (DSO) at the Peak Hill Iron Project, located in the mid-west of Western Australia.

At the Telecom Hill East target DSO mineralisation was intersected in multiple holes, with the peak highlight 29 metres at 62.8% iron, 4.9% Si02, 2.6%AI203 and 0.09%P.

The location of the DSO is very significant as it occurs directly adjacent to the large Telecom Hill East magnetite deposit which already hosts an Inferred JORC Resource of 850 million tonnes at 27.3% iron, highlighting the opportunity for a near term tonnage and grade increase.

Mineralisation is open to the east, west and at depth.

Terry Quinn, managing director if Aurium, said that the direct shipping ore offers more flexible development opportunities, and the potential to development the Peak Hill magnetite processing operation.

“These early results are very encouraging and we look forward to the completion of laboratory work and continuing our exploration program.”

As well as drilling, preparation for the next phase of regional exploration are well advanced to assess the substantial areas of untested banded iron formation stratigraphy present in the project tenure away from Telecom Hill.

Exploration target highlights resource upside

The Peak Hill Project has an exploration target of 3.5 to 5 billion tonnes at 25% to 35% iron covering an extensive 2,500 square kilometres, and is prospective for magnetite and hematite iron ore.

Telecom Hill alone has a direct shipping ore exploration target of 10 to 55 million tonnes at 55% to 58% iron.

At the Mt Padbury Prospect, an exploration target of 20 to 28 million tonnes at 55% to 60% iron has been defined

Aurium to merge into Padbury Mining

Padbury has a 70% interest in Peak Hill with Aurium 30%, with the two companies earlier in the month signing a binding Scheme Implementation Agreement, marking the completion of merger negotiations.

The merger will simplify the future project development, and by being run by a single entity will also save costs while making the decision making process quicker.

Gary Stokes will remain managing director of Padbury, while Quinn will be appointed executive chairman of Padbury, with William Han to remain a non-executive director.

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