Cazaly Resources sees substantial iron ore potential at Hamersley Project, WA

Cazaly Resources' (ASX: CAZ) Hamersley Project lies approximately 50km NE of the Tom Price township in the Pilbara Region of Western Australia.

The project is well placed amongst existing infrastructure and lies immediately south of Fortescue Metals Group’s (ASX: FMG) Solomon project where a recent resource upgrade to ~2.7Bt of iron ore has been announced (FMG ASX Announcement 19th March 2010).

The initial resource at Solomon was estimated at 700Mt @ 56% Fe in December 2007 and has now grown to 2.7Bt @ 56%Fe. The project forms a key part of FMG’s Three Hub Production Strategy.

Within the Hamersley project the company has highlighted several significant areas prospective for Channel Iron Deposits (CID’s) akin to those occurring within the Solomon system.

Furthermore Native Title Agreements have now been finalised and the company is currently progressing approvals for drilling programmes aimed at exploring the continuations of the Solomon system within the Cazaly tenure.

In total, the company has defined approximately 15 kilometres of combined strike extent within these prospective areas within which the company’s Winmar CID discovery is located.

Cazaly’s exploration targets are located in close proximity to the planned FMG Solomon rail corridor.

The results at Winmar highlight the potential for a substantial resource of iron ore. Recent work here has returned very positive results from drilling including 60m @ 55.6% Fe (60.3%CaFe). The discovery also highlights the potential for the discovery of further resources within the region.

The company said the discovery represents just a small portion of the targeted CID system. Work is currently being planned to further test the system.

The Feasibility Study for the Parker Range Iron Ore Project (PRIOP) is ongoing and discussions are being advanced with third parties aimed at bringing the project into production as soon as possible.

http://www.proactiveinvestors.com.au/companies/news/5917/cazaly-resources-sees-substantial-iron-ore-potential-at-hamersley-project-wa-5917.html