Extension Iron Ore Project

AAMC’s Extension iron ore project (Extension) is located in the Pilbara iron ore heartland of Western Australia lying nearby to world leading Channel Iron Deposits owned by BHP Billiton and Rio Tinto that have been in operation since 1991 (Figure 4).  The Yandi iron ore mine which shares a common boundary with AAMC’s Extension tenements is Australia’s largest and most productive iron ore mine, now with a nameplate capacity of approximately 85Mtpa.

Extension will be able to share common infrastructure with Wonmunna, including the ore haulage road through to the Cloudbreak mine site and the ore stockpiling facilities at Cloudbreak.

The Project’s Resources share the same genesis as the Yandi and Yandicoogina Resources, both being a part of the same Channel Iron Deposit formation that was laid down within the Marillana creek catchment area.  The iron ore products from this region are well known and widely accepted by steel makers.

Apart from ore type and product acceptance there are other factors that make Extension attractive for development.  These include:

  1. Extension is permitted by the Environmental Protection Authority (EPA) for a maximum production rate of 4Mtpa and mine site development can commence immediately.
  2. AAMC can sell iron ore from Extension to Fortescue at the Cloudbreak mine site under the Fortescue iron ore sale and purchase agreement.
  3. The Project is only 6 km away from BHPB’s train load out at Yandi, 24km from Rio Tinto’s train load out at Yandicoogina and 88km from Fortescue’s Cloudbreak mine site.
  4. Being within 28 km of the Roy Hill Road, the Project is well supported by an existing sealed road network that connects it to both Port Hedland and to Newman.
  5. The Project has a very low waste to ore strip ratio.
  6. The Project has very soft ore and waste materials, all of which can be productively cut by a surface miner thereby avoiding the need for any drill and blast services.
  7. All of the Project’s Reserves sit above the water table. Apart from simplifying the mining cycle this also simplified the environmental permitting process.
  8. The Project has a simple processing flowsheet with a two-stage crushing circuit combined with a double deck wet screen to remove the -1mm fraction for ore quality improvements.
  9. The Project has a low mine site unit cost and low capital intensity when compared to similar iron ore projects.
  10. As an Aboriginal mining company with broad industry and community support AAMC is well placed to secure additional tenements with project development potential.

Highlighting the prospectivity of the central Pilbara region where AAMC’s tenements are located is the fact that within an 80km radius of the Extension Project there is approximately 370Mtpa of current nameplate capacity and 120Mtpa of planned future capacity (Figure 1).  This area arguably represents the highest density of iron ore production anywhere in the world.

AAMC has undertaken some preliminary reconnaissance works across its tenements and with some significant and early success has identified a number of new discovery areas in which outcropping ore grade mineralisation is evident.  Further exploration will be required before any identified mineralisation in these areas can be converted to Resources.