1 - 2 billion tonne of dso haematite for $140m, page-5

Waratah Gold sets 1Bt to 2Bt DSO haematite target at Youkou in Congo

Thursday, March 03, 2011 by John Phillips

Waratah Gold (ASX: WGO) is a small cap stock with a A$70 million market capitalisation, but is aiming high with the 1 billion to 2 billion tonne haematite Direct Shipping Ore (DSO) exploration target at the Youkou project, providing the potential for the company to jump straight into the big leagues.

The sheer size of the target is difficult to comprehend, with the 60% to 62% iron grade target an impressive pointer to project potential.

To substantiate this exploration target, the target was based on the observed and/or expected strike, width and depth of mapped high grade iron mineralisation, with Waratah saying rock chip samples consistently returned above 60% iron.

An estimate of grade was made on the basis of numerous XRF readings taken in the area.

For many decades iron ore has been known to be in the area, and historical exploration by French geologists in 1936 discovered a haematite-rich area.

The iron appears predominately in a haematite form rather than magnetite as reported at some other Congo projects.

Located 20 kilometres from the Oloba village, this field was formerly operated by Indigenous miners who smelted the iron for local use.

Waratah has subsequently conducted aerial surveys over the entire exploration licence, with a 200 metre spacing and at a height of 80 metres.

Some of the more prospective areas were in-filled to 100 metre spacing.

The survey also identified two linear north-northwest trending target zones that will be evaluated in future field expeditions.

Youkou is remote, 500 kilometres north of Brazzaville in the Republic of Congo, but this is not as big of a problem as it first appears.

Some global miners are entering this very mineral rich area of the world, with Youkou in an area which hosts a number of large-scale iron-ore projects.

One of the world's biggest diversified mining groups Xstrata Plc (LSE: XTA), in 2009 entered into an agreement with Jumelles Limited in respect to the Zanaga iron ore project also in the Republic of Congo.

The project is located in the L?koumou district, 300 kilometres north-east of the port of Pointe Noire, which is within a couple of hundred kilometres of Waratah's Youkou.

With such a major global mining player operating in the area, and other projects in the area including Sundance Resources? (ASX: SDL) Nabeba iron ore deposit; Core Mining?s (Core) Avima iron ore project and Equatorial Resources? (ASX:EQX) Badondo Iron Project, then major infrastructure will no doubt improve dramatically in the short term.

The CEMEC owned Belinga project in Gabon is also only 135 kilometres from Youkou.

Waratah is already looking forward, and proposes to partner with Solethu Investments as Solethu has played an important role in securing the project for Waratah.

Solethu already has a joint venture with Grindrod Limited in RRL Grindrod developing rail infrastructure on the African continent.

http://www.proactiveinvestors.com.au/companies/news/14383/waratah-gold-sets-1bt-to-2bt-dso-haematite-target-at-youkou-in-congo-14383.html