Friday, 6 July 2012

Eagle Star Minerals poised to meet growing demand for agro-minerals in Brazil

As demand for agro-mineral projects in Brazil continues, Eagle Star Minerals Corp., (CVE:EGE) has been working to bulk up its position as a provider of agro-minerals ever since announcing a strategic shift in focus to phosphate exploration in February.
By acquiring the rights to 111 mineral claims, Eagle Star has amassed a strategic land base of approximately 220,767 hectares in northeastern Brazil that features strong-grade phosphates.
In the past few months, two very material changes have occurred within the company, with a new discovery within the Canabrava block at its Ruth project in the centre of PiauĂ­ state, near the cities of Picos and Eliseu Martins, and the acquisition of Bomfim - located in the southern most part of the Tocantins state.
Beginning with the Canabrava block, Eagle Star in June increased its ownership of the property by 17,509 hectares - 11 claims - in light of its recent discovery of a mineralized phosphate package of at least seven metres in thickness. The whole Canabrava block covers 40,678 hectares across 23 mineral claims.
The recent discovery is still open at depth and contains grades of up to 12 per cent phosphate.
Eagle Star’s senior manager of corporate development, Patrick Brandreth, says that the company’s team had the opportunity to investigate the Canabrava block further over the past few months.
"We’ve actually traced that [discovery] over 15 kilometres at surface and it is still open laterally and at depth. We claimed additional areas in that region based on the premises that the package extends further than 15 kilometres."
Indeed, that premise led Eagle Star to conduct a new regional exploration program, focusing this time on different geological formations, where the mineralized rock types outcrop extensively and are visible as a result of road cuts.
"This is very significant news. The newly discovered package itself is quite unique as it is made up of two materials," says Brandreth.
"One of the materials is a high-grade phosphorite sandstone, with grades from 4 to 12 % P2O5 and the other is a lower grade siltstone, yielding grades from 1 to 3 % P2O5 – both have very different physical characteristics which make the possibility of separating the two highly likely.”
Chemical and metallurgical tests have been have been initiated to verify the possibility of using the lower siltstone as natural fertilizer.
"What is interesting is that our team believes that it will be very possible to separate the two grades with traditional mining techniques similar to those used in Boxite,” says Brandreth.

"We will [then] take the low grade reject material to use as a natural fertilizer and tests are ongoing for that, while the high-grade material is to be sent away for concentration."

Results of the chemical and metallurgical tests to determine the solubility of the material are expected by mid-July.
Upon receipt of positive results, Eagle Star intends to start a drill program that will allow it to prove the extent of mineralization in the form of an NI 43-101 resource calculation, while further investigating the most attractive production methods and procedures from an economic standpoint.
"The overall perspective is that if our solubility tests come back positive, then we know we are sitting on a significant deposit,” Brandreth says.
Eagle Star is looking to move into drilling by September.
Meanwhile, at the end of June, the company also inked a deal to acquire the Bomfim agro-mineral project in Brazil, which is located 20 kilometres away from MbAC Fertilizers' (TSE:MBC) Itafos Arraias property.

Eagle Star believes that Bomfim is located along the same phosphate mineralized trend in which the Itafos mine is situated. The company’s COO, director and expert on phosphate, Jose Eloi Guimares Campos, is much of the reason for this strong belief. 

Campos' direct involvement with the Itafos technical study and geological modeling gives him the confidence to say that Eagle Star is indeed sitting on a very similar geological model to that of Itafos.

Eagle Star said the region is considered to be the new phosphate belt of Brazil and has seen many majors claiming in this area such as MBAC, Vale (NYSE:VALE), Votorantim and Bungee.

All exploration permits and licenses are already in place for Bomfim’s 30,922 hectares.
An aggressive exploration program has been outlined, with the aim to define an NI 43-101 measured and indicated resource as soon as possible.
The main mineralization at Bomfim hosts outcropping phosphorite lenses, from where Eagle Star has sample results of up to 28% P2O5.
The company said it will explore the possibility of moving directly into small scale production of the high grade crushed phosphorite, as a natural fertilizer, to assist with the funding of initial operations at Bomfim.
The exploration program at the site is planned to extend over a 16 month period, with scout drilling of 2,600 metres kicking-off as early as October.
The target areas delineated by the initial scout drilling program will then be further detailed by regular spaced drilling totaling 27,000 metres, the company said, to assist in geological modeling and an NI 43-101 resource calculation.
"We are very excited about this property in the sense that it is a Brownfield project," says Brandreth. “It has proven economic, geological, and exploration models by that of MbAC."
These qualities, says Brandreth, could save the company about a year from start to finish with respect to getting the property identified, developed and put into production.
"And for a junior company like ours, that very much reduces the risk and timeframe in which we can move into production.”
Brazil is one of the leading agrarian countries in the world. In addition to being the fourth largest consumer of agro-minerals, it is the second largest world importer of phosphate, a business that generates around $1.1 billion in sales annually for the country.

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