IMX Resources Testwork Support Development Of Mt Woods Magnetite Project

IMX Resources (ASX: IXR) has received support for development of its Mt Woods Magnetite Project in South Australia after testwork indicated it had similar metallurgical properties to that of the Snaefell deposit.

Testing of the 21 samples across seven exploration targets also indicate that high levels of metallurgical consistency are likely across the targets.

An average concentrate grade of 68.6% iron was achieved across all tests at a grind size of 80 microns, including an average of 69.3% iron from the Tomahawk North deposit.

Mass yield averaged 35.5% across all samples including 41% for Tomahawk North.

"We are encouraged by the similarity of these metallurgical test work results to previous test work carried out on the Snaefell deposit," managing director Neil Meadows said.

"These results, together with the findings of previous work carried out at Mt Woods, provide further support for development of the Mt Woods Magnetite Project."

IMX currently has a JORC Inferred Resource of 569 million tonnes at 27% iron at Snaefell and a global exploration target of between 900 million and 1,200 million tonnes at 20% to 32% iron elsewhere in the surrounding area on the Mt Woods property.

Test work

Samples were selected from the drilling carried out on the various exploration targets to represent, where possible, both geodomains of fresh and transitional mineralisation, based on the geological logging of the reverse circulation chips.

The 'Fresh' geodomain is where the magnetite in the basement rock is not affected by weathering and the only iron oxide mineral is magnetite while the 'Transition' geodomain is where weathering has affected some of the basement rock and the iron is a mix of magnetite and non-magnetite iron oxide minerals, such as hematite or goethite.

Samples from specially selected and indicative intervals were composited by Bureau Veritas to generate the exploration target geodomain composite samples used for Davis Tube Recovery testing.

The composites prepared were then ground using a screen size of 150 microns, which resulted in an approximate 80 microns.

Samples were then subjected to DTR testing with assaying of concentrate and tailings products.

This is the same process used for testing of reverse circulation samples from the Snaefell deposit, allowing for a comparison of metallurgical characteristics.

Besides the results from Tomahawk North, other notable results included a 37% mass yield with 70.97% iron at the Penryhn exploration target and a 48.2% mass yield with 68.24% iron at Axehead.

Mt Woods

The recent Scoping Study had highlighted that IMX could mine magnetite from Mt Woods at lower capital and project complexity than current magnetite projects in Australia.

It noted the required infrastructure was already in place and in used by the company's Cairn Hill mine about 15 kilometres to the northeast.

Rail and port infrastructure already exists while grid power at Prominent Hill can be reticulated to the project site at a modest capital cost.

Key findings of the Scoping Study included:

- Base case 2.5 Mtpa option exporting through Port Adelaide provides a mine life in excess of 25 years
- Preliminary after tax project NPV of AUD 289 million
- IRR of 21% from a total pre-production cost of AUD 295 million
- High-grade concentrate produced for an operating cost of AUD $77/tonne FOB giving an operating margin of AUD $45/tonne

Analysis

IMX Resources' metallurgical testwork has indicated that ore from other exploration targets across the Mt Woods project consistently require just coarse grinding to produce a saleable concentrate.

If confirmed, the project's economics appear assured as the Snaefell development is already expected to be an order of magnitude lower than that typically associated with magnetite projects due to the relatively coarse grind size required to produce a high-grade magnetite concentrate.

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