Surefire Resources (ASX:SRN) begins talks on transportation and removal options for the Perenjori Iron Project
Shares of Surefire Resources NL (ASX: SRN) climbed more than 14% after an update on haulage and removal options for its Perenjori iron project was announced.
In a latest version, the company has set an exploration target of 870 to 1,240 million tonnes (Mt) with an average grade of 29% to 41% iron (Fe) on the project. The exploration target can help upgrade the existing inferred mineral resource of 191.7 million tonnes at a grade of 36.6% Fe.
Infrastructure talks are in full swing
The Perenjori iron project benefits from the presence of existing regional infrastructure, including rail and power networks within 15 km of the project. The nearby rail network provides access to the iron ore project to the Port of Geraldton.
The company has entered into discussions with a third-party infrastructure provider to build, own and operate a slurry pipeline and transshipment facility. The slurry pipeline could reduce transportation costs compared to rail, while reducing overall capital development for the project. Currently, an agreement on the same has not yet been reached.
Off-take negotiations for magnetite concentrate
In addition, the company is progressing magnetite concentrate purchase negotiations with potential partners, including global commodity traders. As part of these talks, mine planning, product quality parameters, harvest volumes and pricing mechanisms are included.
In addition, buyers’ risk mitigation considerations are also being discussed, before proceeding to a formal contract.
Suggested reading: Surefire Resources NL (ASX:SRN) ticks all the right boxes in WA projects
Magnetite: the favorite food of the future steel industry
With emphasis on decarbonization of the steel industry, magnetite is recognized as a suitable ore source. Magnetite has the ability to provide high quality iron and also provide a richer supply of energy than products produced by traditional hematite fueled blast furnaces.
The energy comparison of iron and steel with these ores is extremely different. The steelmaking process using hematite is endothermic and hence requires tremendous energy while steel made from magnetite releases heat during the manufacturing process as it is exothermic in nature.
Additionally, the mining grades of hematite ores drop significantly, while magnetite ores can yield concentrates with grades of up to 71% Fe.
To watch: Expert Interviews with Mr. Vladimir Nikolaenko – Executive Director of Surefire Resources
Ore from the Perenjori Iron Project is one of the richest projects among its peers. The project holds an inferred resource grade of 36.6% Fe, which is 2% to 6% higher than other magnetite resources in the Mid-West district. The higher grade relates to a higher economic benefit due to reduced mining and processing costs to produce the final concentrates. So far, metallurgical testwork has demonstrated the potential to produce a premium magnetite concentrate with up to 69.6% Fe and low deleterious element content.
Must read: Surefire Resources scoping study paints bright picture for Perenjori iron project
The Perenjori Iron Project has the potential to provide low carbon magnetite concentrate to the environmentally friendly steel mills of the future.