Following a “robust” scoping study earlier this month, Akora Resources (ASX: AKO) plans to kick-off pre-feasibility work for its Bekisopa iron ore project in Madagascar.
The pre-feasibility study will assess the direct shipping ore (DSO) component of the project, which is considered to have “high potential” due to the “positive characteristics” of the Bekisopa Southern Zone DSO ore.
DSO in the zone averages 64% at surface and a maiden inferred resource was delivered in April this year.
The Bekisopa Southern Zone resource totals 110.2 million tonnes at 37.8% Davis tube recovery producing a 67.6% iron concentrate at a 75-micron grind size.
Within this resource is 7.8Mt DSO at surface, which Akora managing director Paul Bibby says is from drilling only 30% of the 6km strike.
Pending resource upgrade
An infill drilling program was completed in late October at the DSO Southern Zone to gain a better understanding of the ore and build confidence in the resource.
A total of 85 holes were drilled for 1,165.4m on a 50-square metre grid, with depths ranging from 5-24m.
Mr Bibby said the company had completed three more holes than initially planned due to the “significant” iron mineralisation hit during the program, which was observed in every hole of the campaign.
The resource update is anticipated by April next year, which will pave the way for the pre-feasibility study.
Scoping study ‘encouraging’
Mr Bibby said the scoping study released earlier this month for the Bekisopa DSO operation was “very informative” and gave the board the “encouragement” required to move to pre-feasibility studies.
“The study confirms viable pathways to production with robust project economics and provides knowledge that positions Akora to move to a pre-feasibility study, subject to funding, on the Bekisopa DSO in 2023,” Mr Bibby said.
“Once assayed and incorporated into the resource model these iron grades will confirm the potential DSO tonnes and grade that should support a productive low-cost iron ore operation aimed at generating early cash flows.”
He said just from experience, the mineral resource estimate, and walking the ground at Bekisopa, the company believes there may be 15-20Mt of DSO suitable material.
Three scenarios
Wardell Armstrong International (WAI) undertook the scoping study, and evaluated three operational scenarios.
The first scenario looked at mining and processing of known DSO within the 7.8Mt inferred mineral resource.
Scenario two investigated DSO production as described in the first scenario, but this would be followed by mining and producing a high-grade crushed 2mm fines product.
Under the third scenario, DSO would be mined and processed to produce a premium grade concentrate at 75 microns, suitable for Direct Reduction Iron pellets the way to green steel .
WAI determined that each of the scenarios was worth further consideration.
Upcoming work streams
The consultant also recommended further drilling along strike, and geotechnical and hydrogeological studies.
Other recommended work was more metallurgical evaluation, analysis of port options plus environmental and social studies.
Once assays from the infill DSO campaign are at hand, and an updated resource has been calculated, Akora will kick-off the pre-feasibility study.
Mr Bibby said the company’s strategy is to generate early cash flow by focusing on the DSO at Bekisopa, which would provide a low capital cost entry into production.
Revenue from this would then be used to expand the operation.
