Freehill Mining (ASX: FHS) has unveiled its much-awaited maiden iron ore resource for its Yerbas Buenas project in Chile, with the initial estimate “significantly” exceeding the previously outlined exploration target.
The maiden indicated and inferred resource for the YB1 structure totals 18.4 million tonnes at 15.1% iron, with a concentrate grade of 68.4% iron – substantially exceeding the 3.1-6.2Mt exploration target Freehill had previously set for YB1.
“Being able to declare our maiden JORC resource, including some in the indicated category is the culmination of two years of very hard work by our dedicated technical team in Chile and Australia,” Freehill chief executive officer Peter Hinner said.
“Whilst this maiden mineral resource estimate is limited to just one target, it vindicates our belief that Yerbas Buenas could rapidly become and important revenue generator for the company,” Mr Hinner added.
With the YB1 resource significantly exceeding expectations, Freehill is anticipating the remaining six structures, which are a lot larger than YB1, will similarly result in much larger resources and be well above the exploration target of 35.7-50.9Mt for all structures.
Although YB1 is the smallest target, it was drilled because it hosts the trial mining pit where ore has been extracted and processed for the past two years.
To-date, the average grade from the trial mining pit has been 27% iron and more than 168,000t of magnetite concentrate has been sold to Chile’s largest iron ore pellet feed producer Compania Minera del Pacifico, which uses the concentrate to supplement its own ore at the Romeral plant, which is only 13km from Yerbas Buenas.
As Freehill advances the project, it hopes to expedite a feasibility study using data collected from the trial mining and recent drilling campaign.
Further drilling has been scheduled for the third quarter of this year, with the large higher-grade YB6 magnetite structure to be tested along with copper and gold anomalies.