A new exploration programme will be undertaken by Baobab Resources PLC on the Tete iron-vanadium and titanium project in Mozambique to expand on the established resource of 47.7 million tonnes of magnetite.
The resource statement and a statement from global consultant Coffey Mining on potential for between 400 to 700 million tonnes of magnetite-ilmenite mineralisation injected some life in share trading in Baobab on the London AIM board.
Technical director Ben James told Mineweb that Baobab had been a relatively lifeless stock on AIM until details of progress on the project were detailed last month - a factor that has also seen an appreciation in the share price.
The project is immediately north of the provincial capital of Tete and takes in five known vanadiferous-titano-magnetite deposits in what is known as the Massamba Group where there was the assessment for a major system by the mining consultant.
James said that drilling over about 500 metres of an established strike length of 8 kilometres at Tete has shown magnetite resource grades of 25% iron and can be upgraded to 64% Fe and 0.7% vanadium pentoxide.
Conceptual studies show that with a growth of resources, Baobab may have a resource that could produce a ferrovanadium product grading up to 68-69% Fe and 0.8% vanadium pentoxide, as well as a ferro titanium product.
The exploration progress detailed last month has seen several companies knocking on Baobab's door, including Chinese groups, but James said the company wants to undertake more work to prove scope for a major deposit - the first magnetite-iron mining project in Mozambique - before getting into serious discussions.
Baobab has a strategic partnership with International Finance Corporation which has taken a 15% direct stake in Tete.
In logistical terms, the company is well placed. The licences adjoin the substantial coal deposits being developed at Moatize and Benga by Vale and Riversdale. There is also a railway at the regional capital of Tete linking to the port of Beira, while hydro-power is available from the Cahora Bassa dam.
There is a strong Australasian influence in Baobab as Ben James is a product of what was New Zealand's Otago School of Mines, managing director Brett Townsend is a Western Australian, and so is the company's founding director and now marketing consultant Jon Crowe, a familiar face in southern Africa.
Source: Mineweb
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