Axiom Mining's (ASX:AVQ) drilling has intersected high grade nickel laterite at the Isabel Project in the Solomon Islands with grades and widths exceeding evaluations by previous explorers INCO and Kaiser Engineers.
Shares in the company should trade higher on the news.
Drilling is designed to confirm historical data and test potential for further mineralisation below depths of 5 metres to 6 metres.
Key results include:
- 18.2 metres at 1.88% nickel including 12.45 metres at 2.28% nickel; and
- 13.4 metres at 2.01% nickel including 8.4 metres at 2.59% nickel.
"Drilling has produced excellent results that identify significant grade and extension of mineralisation to depths that had not been evaluated by previous studies or exploration," managing director Ryan Mount said.
"There is clearly substantial upside potential for grade and tonnage as we extend drilling deeper to the higher grade saprolite zone, which previous explorers were unable to access due to technological constraints."
The first holes were drilled along an access road with the first hole located at the edge of targeted mineralisation and subsequent holes sited progressively further into the deposit.
Drilling will continue into 2015 with the aim of upgrading data across the deposit to JORC standards, and completing relevant studies to progress the project towards mine development phase.
The drilling program is targeting areas suitable for JORC resource definition and for early mining.
It consists predominantly of diamond drilling and excavator pitting to twin and confirm previous test pits and drill holes.
Other work will test stratigraphy, bulk density, moisture, internal rock size and distribution and other mining factors within the limonite and saprolite zones.
Additional work will test metallurgical characteristics for potential customers and include geological mapping, soil and rock sampling by handheld XRF analyser, and pitting within historical excavations.
Baseline environmental surveys have commenced and include terrestrial and aquatic studies, which will meet Solomon Islands regulatory requirements for subsequent development of the deposit.
2015 Work Program at Isabel Nickel
In 2015, Axiom will focus on:
- geological evaluation, drilling and pitting of suitable mineralised zones to current JORC standards to achieve short term development of a proposed direct shipping of ore (DSO) operation and long term development of the total laterite resource for the potential of on-site processing
- development of sales and mining specifications to match customer and market requirements
- preparing for mining and export of bulk samples
- assessment of on-site upgrading processes such as screening and drying.
Axiom is targeting an aggressive start of a Direct Shipping Ore operation within 12-18 months.
This would progressively ramp up to two million tonnes per annum.
Isabel Nickel Project
The project is 80% owned by Axiom KB, where KB or Kolosori and Bungusule are the two original customary landowning tribes, who collectively own the remaining 20% interest.
The Kolosori tenement covers 49 square kilometres on Isabel Island and is covered by Axiom's leasehold and prospecting licence.
It has historic and non-JORC resources estimated at 159 million tonnes at 1.045% nickel and 0.07% cobalt.
Low cost open pit mining can very quickly generate a direct shipping ore that significantly reduces both operating cash cost and capital cost for plant, power requirements and infrastructure.
The intersection of high grade nickel and extension of mineralisation to depths that had not been previously evaluated indicates potential for upgrades to the grade and tonnage at the Isabel Nickel Project.
Drilling will continue into 2015 with the aim of upgrading data across the deposit to JORC standards, and completing relevant studies to progress the project towards mine development.
Isabel is already expected to be a low cost open pit mining operation that can very quickly generate a direct shipping ore. This will significantly reduces both operating cash cost and capital cost for plant, power requirements and infrastructure.
Axiom holds a 50-year registered lease and Prospecting Licence over the Isabel nickel deposit and is targeting the establishment of a direct shipping of ore (DSO) operation by late 2015.
Nickel is around 20% higher in 2014 following Indonesia restricting ore shipments, with the price recently getting support on speculation that demand out of China will remain.
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