PERTH (miningweekly.com) – ASX-listed Australia Minerals & Mining Group (AMMG) has reached an agreement with Minemakers to acquire its 80% interest in the West Southdown project, in Western Australia.

The newly named Southdown extension project comprises a 22-block exploration licence, lying along strike from ASX-listed Grange Resources’ Southdown magnetite project, which has a resource estimate of some 654-million tons, grading at 36.5% magnetite.

“The acquisition of the Southdown extension project is a significant addition to the company’s existing Yilgarn iron-ore projects, as it adds a more advanced project and strengthens the existing memorandum of understanding relationship with the Chinese Anhui Bureau and other potential joint ventures,” said AMMG MD Ric Dawson.

Under the terms of the agreement, AMMG would issue five-million fully paid ordinary shares to ASX-listed Minemakers and would grant two-million 20c options.

Besides the Minemakers tenements, AMMG has a further five tenement applications in the region, bringing the total Southdown extension project to around 100 km2.

The project is located some 80 km from the port of Albany, and Dawson added that the close proximity to the existing port infrastructure and the proposed new infrastructure from Grange Resources’ Southdown magnetite project, could also enable a potentially significant reduction in capital costs.

“This strategic location eliminates the need to duplicate an additional slurry pipeline corridor and other infrastructure requirements.”

Minemakers initially acquired the West Southdown tenement in 2005, and in 2007 the company announced that strong magnetite mineralisation had been intersected.

The project area has an exploration target of between 300-million and 500-million tons of magnetite mineralisation.

AMMG’s planned drill programme for the coming quarter is to test the width of the magnetite mineralisation and also to determine the economic depth extent.
 

To subscribe to Mining Weekly's print magazine email subscriptions@creamermedia.co.za or buy now.