----- Original Message -----From: "Ralf Wragg" Sent:Sun, 15 Sep...

----- Original Message -----


From:
"Ralf Wragg"

Sent:
Sun, 15 Sep 2013 22:30:56 +1000

Subject:
stock watch for Monday


!STD
RWE (SWMAU) Ferret's Stock Watch: MAGNETIC RESOURCES NL

NEVER SCORN HUMBLE IRON ORE EXPLORERS; CHINA LIFTS STEEL OUTPUT

Sydney - Monday - September 16: (RWE Aust Business News) -
Small iron ore explorer, MAGNNETIC RESOURCES (ASX:MAU) has drilled up some excellent iron ore assays and reported interested two offshore companies that either could become partners or take the company out completely.
The other factor that should attract market interest is the renewed recovery in demand for steel after the scare mongering in the property construction industry that reportedly was going cause serious repercussions in the economy.
The appetite for steel suggests sustained demand for
commodities, even as ... New-home prices increased for a third month in July in all but one of 70 cities ... Ltd. analysts led by Jiong Shao in Hong Kong said in a report last month.
Confirmation of this trend is linked to the price of iron ore which is back to around $US135 tonne.
It's good news for Magnetic where pilot scale testwork has confirmed outstanding metallurgicl properties at Ragged Rock its 100 per cent owned project.
* A bulk sample representing the 5km of strike length of Ragged Rock Target 1 has confirmed outstanding metallurgical properties at Pilot Scale.
* Final product quality of nearly 66% Iron and 6% Silica
* Very high mass recovery to concentrate of over 37%
* Very high quality Sinter Feed produced at a very coarse grind size of 150 micron
* Very coarse grained magnetite will reduce any future Capex and Opex considerably
* Coarse grained, high purity Magnetite can be readily sold into the DSO (sinter) market
* Sinter Testwork to be conducted in China over the next 3 months Magnetic Resource NL (Magnetic or the Company) recently completed a 19 hole RC drill program covering the 5km of strike at Ragged Rock,
Target 1.
Based on the consistent and very promising metallurgical
results obtained across all areas of mineralization, the Company compiled a bulk representative sample to conduct Pilot Scale testwork.
Pilot Scale testwork is conducted to check that the excellent results obtained during Laboratory scale testwork will be closely replicated in a large scale processing plant in the future.
The sample was carefully selected to represent the average ore expected to be fed to a future processing plant at Ragged Rock.
All testwork was conducted by Nagrom in Kelmscott which is a highly reputable laboratory for bulk pilot plant testwork.
The main goal of the testwork was to determine an appropriate grind size for the ore which would consistently achieve a high purity, low contaminant product of a sufficiently coarse size to be readily
useable in the steel making process known as Sintering.
One of the additional benefits of the Pilot Plant trial is the generation of over 300kg of final product which
can be used for various forms of testwork for Process Plant design and possible investors into the project.
Approximately 150kg of this final product will shortly be
despatched to a highly reputable University test
facility where Sintering testwork will be carried out.
The coarse nature and high purity of the Ragged Rock
product is expected to perform well in this Sintering testwork.
Results from this testwork are expected to enhance the ability of Magnetic Resources to obtain a strategic investor into the project and also obtain offtake agreements for any future production.
Commenting on the success of the Pilot Plant trial, Managing Director, George Sakalidis said "we continue to be very pleased with the excellent results being obtained for our product.
Confirmation that we are able to achieve very high quality product at very coarse grind sizes is very promising for the economics of our future project. The commencement of Sinter testwork is also an exciting phase for the company which will further improve our ability to
attract a strategic investor and offtake for future production.


SHARE PRICE MOVEMENTS
---------------------

Shares of Magnetic Resources have been on hold at 12c.Rolling high for the year is 16c and low 6c.The company has 87.8 million shares on issue with a market cap of $10.5 million.

Typically a magnetite ore needs to be ground extremely fine (30-45 micron) in order to make an acceptable final product.
The final product is then too fine to be used in Sintering and must be processed through a Pelletising process which is a high cost, high energy consuming process.
The exceptionally favourable geology of the Ragged Rock project enables a very high quality, low impurity product to be obtained at a grind size 4-5 times coarser than most other Australian magnetite projects.
The very coarse nature of the product also means that it can be used in the Sintering process and would therefore be sold into the DSO market where the average ore supplied is far lower in grade and higher in total impurities.
The drilling samples were fully mixed to create a bulk sample of 923kg.
A representative head sample was taken and this sample was split into 5 identical samples and tested at various grind sizes around the target grind size.
The results obtained are extremely encouraging for a number of key reasons including:
1. Very high mass yields to final product. This markedly
enhances the future profitability of a mining operation
2. Very high quality product consistently achieved over a
number of different grind sizes
3. Minor variation in Silica content over a wide range of
coarse grind sizes. A typical Australian magnetite at these grind sizes would contain silica values in the order of 20%. This minor variation bodes very well for future Process Plant design.
4. Very low total impurities across all grind sizes tested
5. Exceptionally low Phosphorous values achieved at all grind sizes
6. Acceptable Sulphur grades achieved at all grind sizes
Bulk sample Pilot Plant trial - based on the results above, a grind size of 150 microns was selected for the bulk pilot plant trial.
The material was processed through a pilot scale crushing, grinding and magnetic separation flowsheet and the following final product quality was achieved:
This pilot scale result compares very closely to the laboratory scale DTR tests and provides a very high degree of confidence that a very high quality product can be readily produced in a full scale processing facility in the future.


BACKGROUND
----------

Magnetic Resources NL ((ASX:MAU) is an exploration company focusing on iron ore, uranium and gold.
The company holds more than 6,300sqkm tenements in Yilgarn Craton,Western Australia.
Magnetic has undertaken a program of first-pass exploration on this large and mostly unexplored tenement package with the aim of identifying the most prospective areas for further exploration.
The joint venture package currently comprises exploration
licences on which targets for gold, iron, nickel or uranium have been identified.
In addition Magnetic has acquired several areas in its own right, prospective for iron and uranium.
Magnetic is devoting a large percentage of its current
exploration effort in its iron ore projects in the wheatbelt of south western Australia.
The exploration effort ranges from first pass grassroots to more advanced projects exploring for both DSO and magnetite ores.
Progress on these exploration activities are reported regularly to the ASX.
MAU holds interest in four iron ore projects. (i) Jubuk project performed a gravity survey which shows that gravity zone extends along 4km strike of known magnetite mineralisation. Magnetic has completed 68 drill holes, totalling 7720m, and completed 532 Davis Tube Recovery
(DTR) determinations on RC drill samples from the drilling programmes.
The test results continue to show the potential for the project to produce a high-grade concentrate suitable for Direct Reduction Furnace usage based on the high Fe and low SiO2 contents.
(ii) Mt Vernon: Ten magnetic targets were identified from
regional aeromagnetics of Mt Vernon prospect. Davis Tube Recovery test has shown low SiO2, Al2O3 and P contents.
(iii) Wubin Well, Magnetic completed a 72-hole, 3082m RC
drilling program at the Cheesemans and Buntine iron ore targets in the Wubin area about 235km NNE of Perth.
At Cheesemans the drilling tested a 1km strike length in the northern part of the 11km-long anomaly.
(iv) Rock Dam Hill.
MAU holds interest in three gold projects.
* Tampia North, * Lake Grace and * Holland Rocks.
Magnetic is seeking to farm out these gold
prospects in order to focus on its iron ore projects.
ENDS
!END