Richmond Mining (ASX: RHM) has begun a review of historical drilling data over the Section 5 target at Buena Vista which has highlighted the potential for additions to the Buena Vista iron Resource, as well as higher grade magnetite mineralisation.
Four holes from Southern Pacific Company's 17 hole drilling program have been reviewed to date and all demonstrate wide widths of magnetite mineralisation, with individual assays in many cases of above 30% total iron and as high as plus 50%.
Historical magnetic surveys and drilling completed at Buena Vista by Southern Pacific Company, Columbia Iron Mines and US Steel between about 1957 and 1979 identified numerous zones of potentially economic magnetite mineralisation.
The largest and most significant of these zones, referred to as the West Deposit, has been further investigated by Richmond.
During 2010 and 2011, Richmond completed a series of check diamond drill holes, detailed assaying and extensive metallurgical testwork to establish an Indicated Resource of 88.7 million tonnes of magnetite containing an average of 20.4% total iron.
A Feasibility Study was completed over the West Deposit for a base case 10 year operation producing an average of 1.75 million tonnes per annum of high grade, above 67.5% iron, magnetite concentrate.
However, the existing JORC Resource and potential of targets such as Section 5 could extend the operational life to 20 years or longer.
Work has also begun on examining a number of the other significant historical magnetite occurrences at Buena Vista, with the initial focus on the South Central, Section 5 and Iron Point targets.
Buena Vista Iron Project
Demonstrating the value of Richmond's Buena Vista Iron Project is the number of financing offers of higher than the project's forecast capital costs rolling in from major banks and capital providers.
Richmond has received offers of up to US$180 million to finance the project, more than the forecast US$161 million capital costs defined by the Feasibility Study.
Late last year the company upgraded the Indicated JORC Resource by 36% to 88.7 million tonnes at 20.4% total iron at the West Deposit, with a 10% total iron wire framing cut-off grade.
Richmond is targeting commissioning of Buena Vista before the end of 2012, with high quality magnetite concentrate scheduled to be available for shipping within nine to 12 months of finalising project finance.