London Mining - MARAMPA UPDATE
(Thomson Reuters ONE) - Highlights * Estimate for the tailings resource reported according to the JORC code * Additional tailings and primary ore resource estimates expected by end of Q1 2010 * Sufficient resources for 1.5Mtpa starter operation in 2011 with potential to double production from tailings * Planning underway for expanded production from the primary resource * Ausenco appointed to provide project management services * Confirmation of barge and shiploading capacity for up to 10Mtpa to accomodate tailings and primary ore production * Fiscal incentives package now confirmed on the Sierra Leone parlimentary agenda; vote expected before end of February 2010London Mining ("the Company") today provides an update on its Marampa Project inSierra Leone, including: an initial resource estimate for the tailings, reportedaccording to the JORC code; an outline on its plans for expansion to 5-8Mtpathrough development of the primary ore body; the appointment of Ausenco Ltd("Ausenco"); and progress on the final approvals for its fiscal incentivespackage.The Marampa Project is located 120km from Freetown in Sierra Leone and is 100%owned and operated by London Mining though its subsidiary London Mining CompanyLtd. London Mining is developing a tailings reprocessing operation and isdefining its main resource body to develop a full scale mining plan.Snowden Mining Industry Consultants ("Snowden") has estimated a resource for thetailings portion of the Marampa Project of 32.5 Mt grading 22.67% Fe, comprising29.6Mt grading 22.79% Indicated Resource and 2.9Mt grading 21.51% Fe InferredResource. Resources are reported in accordance with the JORC Code 2004 and at acut-off of 15% Fe. The current resource is based on a drilling programmecomprising some 400 holes but core recovery below the water table has beenvariable with only 43% of holes being completed to the the base of the tailings.London Mining plans to drill a further 200 holes comprising 2,300m to be drilledusing a new aircore rig to allow an updated tailings resource statement to bereported by the end of Q1 2010. Initial testwork by CDTM in Brazil has shownthat a sinter feed with >65% Fe, <3% SiO2 and <1% Al2O3 can be produced using aprocess route involving two-stage magnetic separation.The resource reported today is in line with assumptions from scoping work,specifically relating to resource grade, beneficiation characteristics,operating costs and marketing studies for the resultant concentrate. Theresource provides London Mining with at least six years of production at1.5Mtpa concentrate at an estimated capital cost of approximately USD80m(including contingency and working capital build) with operating costs ofUSD32.9/t of concentrate and potential to accelerate production to 3Mtpa thoughan expanded tailings operation ahead of first concentrate from primary ore. Itis London Mining's intention to fully fund development of the tailings operationusing existing cash reserves and incremental cash flow.Ausenco has been engaged to provide project management services and technicalsupport to the London Mining owners team to facilitate construction and ensuretimely delivery of the 1.5Mtpa tailings reprocessing operation. Development ofthe gravel haul road to the barge loading site at Tawfayim is proceeding toschedule with all the main structures now in place ahead of the wet season.London Mining is also in final discussions with a provider of barging andfloating crane transhipment capacity. The floating crane represents the mainlong lead item and a final agreement would secure capacity for 5Mtpa ofconcentrate with a single crane, with potential for expansion by a further5Mtpa through the addition of a second crane.London Mining will also commence work on a further expansion to a 5-8 Mtpaoperation once it has determined the size of the primary resource by the end ofQ1 2010. In the interim, London Mining has initiated negotiations with Ausencoto undertake a preliminary technical study to better define the economicpotential of an expanded operation. London Mining has now completed 2,700m ofdrilling onthe Masaboin and Ghafal primary ore deposits and plans a further6,000m drilling in 2010. This work is intended to allow an initial estimate tobe reported in accordance with the JORC Code for the primary ore resource andfor a prefeasibility study to be completed by the end of 2010. In addition,further metallurgical work is to be undertaken to determine the suitability ofconcentrate from the primary ore body for sinter or blast furnace pellet feed.London Mining is actively pursuing potential offtake partners for the Marampaproducts.Michael Andrew, Divisional Manager Applied Geosciences of Snowden MiningIndustry Consultants BSc, MAUSIMM, and Ricardo Alvares de Campos Cordeiro ofCoffey Mining, Brazil and a professional member of the Australasian Institute ofGeosciences; who meet the criteria of a qualified person under the AIM Rules -Guidance for Mining, Oil and Gas Companies, have reviewed and approved thetechnical information contained within this announcement that relates to thereporting of the Marampa Mineral Resource.Marampa Mineral Resources as at January 2009, reported at a 15% Fe cut-off. Measured Indicated Inferred Asset Operator Tonnes Grade Tonnes Grade Tonnes Grade (Mt) (% Fe) (Mt) (% Fe) (Mt) (% Fe) Marampa, London Sierra Mining Leone - - 29.6 22.7 2.9 21.5 Company LtdThe Marampa Project mining agreement, environmental impact assessment and fiscalincentives package has already received full cabinet approval and is confirmedon the Sierra Leone parlimentary agenda. London Mining now expects aparliamentary vote and subsequent ratification to follow in February after whichit will then proceed with full development of the tailings reprocessingoperation. This will be the first comprehensive mining agreement to have beenpresented in accordance with the new Mines and Minerals Act, which was approvedby the Sierra Leone Parliament on 30 December 2009.Graeme Hossie, CEO of London Mining plc, said,"Marampa is London Mining'sleading project based on its stage of development, sizable production volumepotential, excellent logistics and technical simplicity. The partial tailingsresource announced today allows Marampa to commence production quickly and startgenerating cash flow from which we can expand iron ore concentrate productionfrom tailings to 3mtpa prior to commencing production from the primary ore. Italso allows us to accelerate the construction of infrastructure for the enlargedoperation based on the primary orebody. We look forward to announcing anexpanded resource, operational updates, expansion plans and an agreement onofftake over the course of 2010".Please see the full announcement, including Glossary of technical termsenclosed. For more information, please contact: London Mining Plc Graeme Hossie, Chief Executive Officer +44 20 7201 5000 Rachel Rhodes, Finance Director Thomas Credland, Head of Investor Relations Liberum Capital (Nominated Advisor/Broker) Clayton Bush/Ellen Francis +44 20 3100 2000 Crux Kommunikasjon AS Charlotte Knudsen +47 97 56 19 59 Threadneedle Communication (UK) Laurence Read/ Graham Herring +44 20 7653 9850 The Company'swebsite can be found at www.londonmining.co.uk
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Datum: 29.01.2010 - 02:31 Uhr
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