company say project will proceed, page-6

Here is a very recent article from the company...you may not have read it previously - (I found it today searching Irvine Island).....check out this paragraph.(the full story follows). Not bad when you have a market cap less than $60m and hundreds of millions of tons of iron ore, on an Island.


http://www.theajmonline.com.au/mining_news/news/2011/march-april-print-edition/native-title-harmony-helps-pluton-advance-buccaneer-project

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?We have had approaches from an awful lot of Chinese steel groups, mining groups who want to be a joint venture partner,? Schoer said. ?I would think that some of the other groups would not like to take no for an answer, so that leaves us pretty vulnerable.?
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Native title harmony helps Pluton advance Buccaneer project

? by The Australian Journal of Mining? created Apr 29, 2011 07:36 AM

Pluton Resources? flagship iron ore project on Irvine Island, in the Buccaneer Archipelago, is at an advanced stage of exploration. Crucially, the company has secured a native title agreement with traditional owners, a feat which eluded BHP and Portman, two companies that had previously planned to mine the island. Mike Foley reports.

Recent assay results on Yampi Member composites from the Hardstaff Peninsula averaged 69.11% Fe.

Sheltered in a clawing reach of the rugged sandstone and scrub escarpments of West Australia?s Kimberley coast nestles the vast Yampi Sound, no more than a notch in the immense continent-spanning coastline.

A ragged procession of islands starts within, straggling westward toward the limits of the Sound. Three renegade members of the Buccaneer Archipelago arch westward beyond the sheltered waters of the Sound into the vastness of the Indian Ocean.

Irvine Island, measuring just 3x3km, is remote and isolated, even by Australian standards. It lies 200km north of Broome; the nearest town of note is Derby, some 150km to the south. Irvine Island is one of three islands forming the Kimberley Iron Ore Hub. The other two islands, Koolan and Cockatoo, have been mined, on and off, for over 50 years.

Iron mineralisation at the Hub is much younger than the deposits of the Pilbara and is contained within sedimentary rocks as dark brown bands within the otherwise pale brown sandstones. One layer in particular, the Yampi Member, measuring up to 40 metres thick, contains very high concentrations of iron and has been the primary focus of exploration and mining activity in the region. This layer outcrops on all three islands of the Hub making it the closest iron ore deposit in Australia to Asia.

The Buccaneer Archipelago?s rich bounty first enticed BHP to explore the area in the early 20th century.

Mining in the Kimberley Hub began in 1951, accounting for Australia?s first iron ore exports. Operations continue to this day, with a HWE/Cliffs joint venture and Mt Gibson operations on Cockatoo and Koolan respectively. Irvine, as yet, remains untouched.

Although it is uninhabited, Irvine Island boasts several sacred sites for the Mayala people. These are located on the opposite side of the island to the mineral deposits.

With its native title deal in hand, Pluton is waiting only for an environmental approval, which might take 18 months to process, before it can begin mining Irvine Island.

?Irvine Island has never been drilled before,? Tony Schoer, chief executive of Pluton explained. ?The history of it was that BHP owned all three islands (in the Buccaneer Archipelago) and they did some ground work on Irvine, but by the time it had recommended drilling, BHP actually exited the area and closed the other two islands.

?Portman then picked it up and had no success in negotiating with the native title claimant group, so basically they were just sitting on it. I picked it up and floated a company based on Irvine Island. We negotiated with the indigenous guys to get access and explore on the island. We did that by building the relationship and making promises we knew we could keep. Since then we are still drilling.

?When we first met the Mayala,? Schoer explained, ?the first thing we did was go to them and say: let?s get together on a boat. We went to Irvine for ten days, spending the time living on the boat and having a look around the island. During that time we built our relationship and it really started with them being highly suspicious of our intentions. And quite rightly so.?

Pluton?s native title agreement ?is based heavily around (the Mayala?s) compensation, royalties and equity, and also heavily around training, education and jobs,? Schoer said.

?We were able to prove to the Mayala that their history and their sacred sites would be protected, and that they would benefit from production. During our exploration program, about 50% of employees are indigenous, which is certainly the highest percentage in the Kimberley.

?Most of our indigenous employees have never worked before. We had to give them basic training, health and safety, show them how to use basic equipment. Since then it has been an incredible success, the Mayala are very, very good employees, good workers. We have promoted two of them to senior roles, up to the stage one of our guys? who has never worked before, and is in his 40?s has just bought his first house. Based on his employment, he was able to get a loan from the NAB.?

Schoer said that Pluton was invited to attend the Prospectors and Developers Association of Canada Convention (PDAC) in March, with Mayala elders, in light of the success of their work together.

Iron ore mineralisation on Irvine Island is exposed in two locations ? the Hardstaff Peninsula and the Isthmus region. Both are located on the eastern side of the Island. Drilling to define a resource is ongoing on the Isthmus.

In late February 2011, final concentrate assay results proved that Irvine?s ore lives up to the pedigree of the region. XRF analysis indicated consistent high quality concentrate averaging around 69% Fe from the Yampi Member target on the Hardstaff Peninsula.

To date, Pluton has reported an inferred mineral resource totalling 483mt. This includes 107mt at 44% Fe from the Yampi Member and 376mt at 21% Fe in the Wonganin Sandstone resource. Within the Yampi Member, a higher grade component exists, with 60mt at 51% Fe using a cut-off grade of 50% Fe.

Beneficiation will be done on Irvine. Schoer said he expects the process to be relatively cheap, as Irvine?s ore is low in impurities and requires no fine grinding to produce concentrate. At the final stage of production, Pluton will export ore directly from the island.

Pluton expects to export directly to Asia, Schoer said, with a minimum of infrastructure required. ?The water is 54m deep off the edge of the island, so all we need is a shiploader, which would cost about $80m whereas a port would cost about $1bn plus.?

According to Schoer?s rough guess, Irvine would produce around 5mtpa. However, production will not begin for at least 18 months. An Environmental Approval is still pending. ?It?s a very slow process in the West, and on top of that, we are in the Kimberley on an island. Naturally there is scrutiny over what we do. For about three years now, we have been doing studies on whales, turtles, seagrasses, flora and fauna and corals.

?There is certainly nothing rare or endangered there, but we have to protect the environment. In fact, we are very environmentally conscious. That?s why we have won a couple of major environmental awards. We don?t want to leave the place a mess,? Schoer said. Representatives from the Australian National University have visited Irvine Island, and the university holds shares as an ethical investor.

?At the moment we have a non-binding memorandum of understanding with a major Japanese trading company, so they are our preferred partner,? Schoer said.

?We have had approaches from an awful lot of Chinese steel groups, mining groups who want to be a joint venture partner,? Schoer said. ?I would think that some of the other groups would not like to take no for an answer, so that leaves us pretty vulnerable.?

For now, Schoer is happy just to get on with the work at hand. ?Once the pre-feasibility study is done, we can sit down with the Japanese and work out what it will cost them to buy into the project. Until we have those results, we don?t know what the project is worth, so there is no point agreeing on a price until we know the economics of the project.?