CXM (ASX) iron ore on the eyre peninsula

A breath of fresh Eyre for uranium
Robin Bromby
November 27, 2006
APART from the big iron ore pits developed since 1899 by BHP, South Australia's Eyre Peninsula has been a neglected exploration backwater.
Over the years, there has been some low-profile mining of minerals such as jade, graphite and gypsum.

But, apart from the steel manufactured at Whyalla, this region, based on Port Lincoln, has depended largely on wheat and barley, commercial fishing and tourism for its livelihood.

Fast-forward to the present day and the Eyre Peninsula is buzzing with activity and becoming one of our uranium hotspots.

Canada's uranium giant Cameco is exploring there, as are local juniors Gawler Resources, Intermet Resources and Australasia Gold.

Adelaide Resources, which has one of the largest land positions on the Eyre with gold and iron ore prospects, added uranium to that list last week.

It will join Quasar Resources, the exploration arm of the US-owned operator of the Beverley uranium mine in South Australia, to explore north of the township of Wudinna.

This is the second time around in this area for Adelaide Resources. It picked up these tenements in 1996 when it was virgin territory for exploration. Gold was found, but not enough to justify a mine.

Adelaide Resources executive chairman Keith Yates told its annual meeting last week the deal was part of a big move into uranium for the company.

Australasia Gold has picked up the Murninnie project, which includes an old mine that produced small quantities of high-grade copper, although there was never much exploration done away from the mine. The mine, which also contains bismuth and gold, has been in the hands of one family since 1929. Now the Adelaide-based junior believes the place has good uranium potential.

Recently listed Gawler Resources, associated with Perth mining figures David and Gary Steinepreis, is targeting uranium 10km west of the town of Cowell.

And WCP Diversified Investments (formerly stationer W C Penfold) has opted to earn a stake in Intermet Resources' Coulta uranium project, 32km southwest of Cummins.

Meanwhile, it looks as if iron ore is the other potential pillar for a new mining era on the Eyre Peninsula.

The big story there is Centrex Metals, which on Friday released more encouraging drilling results from its Wilgerup hematite project.

Even though exploration is still at a reasonably early stage, Centrex has already attracted the attention of the Chinese.

Within two days in July, Centrex announced two deals. Shenyang Orient Iron & Steel, on the day before Centrex started trading on the Australian Stock Exchange, announced it was pumping $3 million into the junior to buy a 7.8 per cent stake. They also signed for the first million tonnes of hematite a year coming out of Wilgerup.

The next day, Baotou Iron & Steel invested $4.38 million in Centrex shares and also put its name down for a million tonnes a year.

Centrex's long-term plan is to mine magnetite. Managing director Gerard Anderson takes comfort from most of the deposits being near the coast. In addition, he will be able to use an existing rail line into Port Lincoln, where wharf space is now being negotiated.

"We think it's one of the best places in the world to have a mine," he added.

http://www.theaustralian.news.com.au/story/0,20867,20826379-5005200,00.html