- Magnum Mining and Exploration (MGU) is investigating existing stockpiles of ore on-site at its US Buena Vista project to potentially accelerate the path to production
- The company reports the stockpiles exist near where Magnum expects to build a crushing mill
- While surface sample grades have returned reads of nearly 27 per cent iron, drilling is required to better estimate commercial viability
- The topography underneath the stockpiles is unknown and so total tonnage estimates range far apart
- Shares are up 2.63 per cent, trading at 3.9 cents at 11:49 am AEST
Magnum Mining and Exploration (MGU) has announced it will commence investigating stockpiles of ore on-site at its Buena Vista iron ore project in Nevada to assess the potential for early production.
The company’s existing stockpiles are located half a kilometre from the area where Magnum intends to build a crushing mill.
Surface sample grades acquired from the stockpile have yielded 26.7 per cent iron, but Magnum’s geotechnical experts cannot provide a comprehensive grade estimation until drilling is completed.
In terms of volume, the stockpiles are estimated to contain between 411,000 and 894,000 tonnes. Magnum believes that grades could potentially reach up to 45 per cent iron.
“The potential quantity and grade of the stockpile estimate is conceptual in nature,” the company wrote.
Where are the stockpiles from?
The stockpiles originate from historical operations by former site owners US Steel, who were active in the 1950s.
Ores that were considered low-grade during that period were deposited in these stockpiles, which Magnum inherited upon its acquisition of the project.
Despite an examination of historical records, Magnum does not possess tonnage data associated with these stockpiles.
If drilling confirms the commercial viability of the stockpiles, they could potentially align with the company’s strategy to establish a magnetite beneficiation plant at the mine for concentrate production.
Why is there so much uncertainty?
The uncertain topography beneath each stockpile contributes to the significant variance between the lower and upper tonnage estimates, which exceeds 300,000 tonnes.
Additionally, the company assumes that after more than forty years, the ore has settled into a more compact composition, resulting in a reduced overall swell factor.
In summary, the exact nature of the stockpiles remains uncertain until drilling operations commence.
“It will save considerable mining costs if they prove to be of sufficient grade to be economic. Work to date indicates this may be the case although more work needs to be done to confirm bulk grades,” Magnum CEO Neil Goodman clarified on Wednesday.
Magnum shares were up 2.63 per cent, trading at 3.9 cents at 11:49 am AEST.