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(Sharecast News) - Mineral exploration and development company Alien Metals has entered into a binding option agreement with Windfield Metals to acquire a 51% interest in two exploration licences prospective for Direct Shipping Ore (DSO) iron ore in the Pilbara region of Western Australia it announced on Friday.
The AIM-traded firm said entering into the agreement was a "significant step" towards the delivery of its strategy of building a portfolio of mining projects which demonstrate development upside, in global jurisdictions with an established infrastructure and mining codes, and where strong operational controls could be assured.
Alien said it was currently exploring for silver and gold in Mexico's richest silver mining belt, with the option agreement with Windfield allowing it to diversify its assets base in a tier one mining jurisdiction.
The company added that it would continue to assess various precious and base metal projects, and expand its asset base over the coming year.
Alien Metals noted that Western Australia was the largest iron ore producer and exporter in the world, with production of around 800 million tonnes of DSO dominated by mining giants Rio Tinto, BHP and Fortescue Metals.
It said historic exploration undertaken by mining majors demonstrated high-grade DSO iron ore potential.
At the Hancock Ranges Iron Ore Project, Alien said it was on-strike to the Brockman Mining Sirius Deposit, which had a JORC inferred and indicated mineral resource estimate of 124 million tonnes at 60.32% iron.
It said one of four historic drill holes returned 126 metres at 60.28% iron from surface, with surface results taken from an approximate four kilometre outcropping on strike mineralised ridge in the north west of the project area returning assay results of up to 68.7% iron.
On the Brockman Iron Ore Project, Alien said it contained part of the historic BHP deposit 20, with surface sample grades averaging 62% iron.
The board said the tenement geology was dominated by the Brockman Iron Formation, which hosted nearby commercial operations.
It said the tenement remained underexplored for iron mineralisation, despite being held by numerous companies over a long period of time.
Alien said it would undertake first pass exploration programmes to further test the potential of the iron ore projects.
The firm said it would continue to advance its Mexican project portfolio, and review other opportunities in the precious and base metals sector.
"This is an extremely exciting opportunity for the company," said Alien Metals chairman Dan Smith.
"Over the last six months the board has been reviewing a range of potential opportunities and these projects are surrounded by major iron ore mines owned by global mining companies and there has already been significant interest in these projects given their prospectivity and resurging iron ore price.
"These iron ore licences are in the heart of the most prolific iron ore region in the world, with first class transport links and associated infrastructure."
Smith said it represented a "real opportunity" for the company to unlock shareholder value, as iron ore-focussed companies had delivered "significant" returns to investors this year.
"We are excited to commence fieldwork in the fourth quarter of 2019, and will update the market on our progress in this regard."
15 Mar 2024 16:31
Alien Metals announces short-term funding for exploration project
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