Australian Mines announces maiden resource at Flemington, says its only scratched the surface
Australian Mines (ASX: AUZ) has announced its maiden resource for the Flemington cobalt-scandium project in central New South Wales, which the company claims merely “scratched the surface” of the project’s full potential.
Because this maiden resource covers only 1% of the identified prospective area, Australian Mines believes it has “significant” opportunity for growth, with a resource expansion campaign due to kick-off in November and a pre-feasibility study to be completed in mid-2018.
The maiden resource for Flemington sits at 2.7 million tonnes grading 0.1% cobalt, 403 parts per million scandium for 2,744 contained tonnes of cobalt and 1,090 contained tonnes of scandium metal.
Australian Mines claims the cobalt-scandium-nickel mineralisation is a continuation of Clean TeQ Holdings‘ (ASX: CLQ) Syerston ore body, which is adjacent to Flemington.
As part of its strategy to advance Flemington and boost this initial resource, Australian Mines plans to establish a regional office at the nearby town, Parkes. The company has already secured water for any future operation and submitted a preliminary environmental assessment report.
“We know Flemington hosts a world-class deposit in its own right, able to produce cobalt sulphate, nickel sulphate and high-quality scandium oxide for global customers,” Australian Mines managing director Benjamin Bell said.
He added the company’s upcoming resource expansion campaign at Flemington is the largest drilling campaign its ever conducted.
Australian Mines’ flagship Sconi cobalt-nickel-scandium project
This maiden resource compliments Australian Mines’ flagship Sconi cobalt-nickel-scandium project in Queensland, which is estimated at 89 million tonnes grading 0.06% cobalt and 0.58% nickel.
According to Australian Mines, Sconi is the “most advance project of its type in Australia”.
Trial mining was started at Sconi at the end of September, and is expected to produce 160kg of nickel sulphate, 20kg of cobalt sulphate and 5kg of high-grade scandium oxide.
“The commercial samples of cobalt sulphate, nickel sulphate and scandium oxide, that will be produced have been allocated to our potential offtake partners to verify our production is fit for end-customer purpose,” Mr Bell said.
Additionally, Australian Mines is in advanced discussions with potential investment partners.
An existing pre-feasibility study into Sconi revealed it had capacity to produce 24,000 tonnes of nickel sulphate and 3,000 tonnes of cobalt sulphate annually for an initial 20-year operation. A bankable feasibility study is underway and expected to be completed by mid-2018.
The mining lease and environmental licence have been granted for Sconi and its first battery grade products from trial mining and processing are scheduled for December.
Sconi is 250km from the Townsville port in northern Queensland which has been approved for cobalt export.
As well as the port, the project is near to roads, electricity, housing, skilled workforce, water and telecommunications infrastructure.