JOHANNESBURG (miningweekly.com) – Aim-listed Bellzone Mining’s Kalia iron-ore project, in Guinea, remains a key asset; however, commodity pricing and a lack of available finance to develop greenfield iron-ore projects in the current challenging economic environment “were not conducive” to funding Kalia as defined in the independent bankable feasibility study, which the company released in September 2013.

But, Bellzone advised on Friday that a strategic review undertaken in the first half of this year had revealed nickel potential within the iron-ore Joint Ore Reserves Committee- (Jorc-) compliant reserve and resource at the company’s 100%-owned flagship project, with a Jorc reserve of 6.1-billion tons.

As such Kalia could be brought into production despite the challenges presented by the current state of the financial markets, lower iron-ore prices and infrastructure limitations for the production and export of bulk materials in Guinea. “Nickel pig iron, or ferronickel production will not require large-scale investment in infrastructure,” Bellzone stated.

The company believed that completing the study on developing Kalia through the on-site processing of iron-ore to produce nickel pig iron, or ferronickel, would present the best opportunity to secure financing to enable the full development of the Kalia iron-ore mine.

Meanwhile, Bellzone had reduced its operating costs by 47.5% and cash outflows from operating activities by 42% for the six months ended June 30, compared with the prior period.

This was owing to changes in its Jersey corporate and Perth office operations, the company said in a statement on its unaudited interim results for the six months ended June 30.

Further, the availability period and the repayment date for Bellzone’s $4-million loan facility, previously announced on August 18, 2014, and amended on January 28, 2015, had been extended to March 31, 2018.

The funding available under the loan facility was increased from $4-million to $10-million, of which $8.5-million had been drawn to date.