JOHANNESBURG (miningweekly.com) – Iron-ore developer Ferrum Crescent has started the process of outlining the cost of mining its Moonlight iron-ore project, in Limpopo.

The ASX-, JSE- and Aim-quoted emerging miner on Monday said it was planning the next stage of the project’s bankable feasibility study (BFS), which included bulk sampling to complete all the mining cost components, as it awaited the drill-core sample results from a ten-hole drilling programme initiated at the end of 2014.

The results from an independent report from the Mineral Corporation on the exploration results, which were expected this month, would enable the company to finalise plans for the location and design of the openpit mine at Moonlight, for inclusion in the final BFS, said Ferrum MD Tom Revy.

However, the group said it would need to raise capital during the quarter to June to enable it to settle its liabilities as and when they fall due and continue to meet its incurred, committed and planned expenditure.

On Saturday, Ferrum had cut its ties with Oman-based investment firm Anvwar Asian Investment (AAI) after the latter failed to pay a second tranche of a final investment agreement signed a year ago.

The agreement proposed that Ferrum receive $10-million in exchange for the granting of a 35% interest in its subsidiary Ferrum Iron-Ore, the holder of the Moonlight assets, to AAI.

However, AAI breached the contract shortly after paying the first tranche of $500 000 by failing to deliver on the second tranche of $500 000 by April 2014. The final $9-million was to be paid by December 2015 or upon the completion of the BFS, whichever came first.

Ferrum was continuing discussions with a “number of interested parties” to fund the company’s working capital requirements, with several site visits concluded as part of the potential investors’ internal due diligence work.

“While securing financing is difficult in these markets, recent advances in our negotiations show that groups with a real interest in securing physical metal supply to feed their industries are, once again, looking at viable routes to create vertically integrated supply,” Revy said.

Ferrum, which had current assets of A$1.86-million as at December 31, had incurred a net loss of A$463 690 in the six months to December 31.