Baobab Resources (LON:BAO) Positive Test Results Point to Simpler Processing Options and Capex Savings

Baobab Resources PLC (LON:BAO), the mineral exploration and development company with a portfolio of assets in Mozambique, is pleased to provide an update on the metallurgical test work which is being completed as part of the Pre-Feasibility Study (PFS) at its 85% owned Tete pig iron, vanadium and titanium project (IFC (International Finance Corporation) hold a 15% participatory interest).

HIGHLIGHTS

- Beneficiation test work recently completed on samples from the Tenge resource block demonstrates that the iron ore can be sufficiently upgraded to a concentrate of smelter-feed specification through low cost, coarse crushing (-3.35mm) and dry magnetic separation (a process known as 'coarse cobbing')at a very high mass recovery and a total iron yield of 63% and 84% respectively.

- The coarse cobbing concentrate specification is significantly coarser than the 150 micron grind size concentrate modelled in the 2011 Scoping Study which requires a ball mill and wet magnetic separation production circuit.

- The simplification of the beneficiation process, by eliminating the requirement for the milling, wet magnetic separation and agglomeration stages, will significantly reduce the initial capital expenditure burden.

- Preliminary mass balance calculations completed by engineering specialists, SNC Lavalin ('SNC'), conclude that smelting of the coarse cobbing concentrate can produce a high quality, ISO compliant pig iron as well as a valuable vanadium slag by-product. Further validation, incorporating local coal specifications, is on-going.

- SNC has commenced both beneficiation and iron making process engineering studies, the results of which will provide a more accurate estimate of capital and production costs.
Commenting today, Ben James, Baobab's Managing Director, said: "The key outcome of this test work is the potential to make significant savings in the start-up capex for the Tete Project. The ability to smelt a much coarser concentrate also allows for a less complex beneficiation and pyro-metallurgical route than originally contemplated. It is important to note that the preliminary specifications of the Project's potential pig iron product are well within the ISO standard for steel-making pig iron.

"With the recent GBGBP4m strategic investment made by the Africa Mining Exploration & Development fund (refer to RNS dated 6 July 2012), the Company is now fully funded and wholly committed to the rapid completion of the Pre-Feasibility Study."

PRE-FEASIBILITY STUDY & DRILLING UPDATE

In parallel with SNC Lavalin's work programmes, the Company is pleased to announce that good progress is being made on the environmental impact assessment and mining and geotechnical studies being managed by Coffey Environment and Coffey Mining respectively.

Drilling is also progressing well in the Tenge/Ruoni area with a total of 6,500m reverse circulation (RC) and 3,230m diamond drilling completed so far this season. The bulk of the drilling has been designed to upgrade resources at Ruoni North and Ruoni South as well as defining new resources within the Ruoni Flats area where Coffey Mining estimated an Exploration Target of between 120m and 260m (please refer to RNS dated 29 March 2012). Upgrade resource drilling in the Tenge resource block is expected to commence by the end of September
2012.

View the full announcement here:
http://media.abnnewswire.net/media/en/docs/73179-bao.pdf


About Baobab Resources plc

Baobab Resources plc (LON:BAO) is a Mozambican-focused explorer with a large landholding in the central north of the country. The company's flagship project is the Tete iron ore deposit.

 

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