Iron road list on Thursday, they should have a good first days trading. Heres some info on them.
A new Australian iron ore float is underway as Iron Road Limited looks to raise $5 million to develop projects in South Australia and Western Australia. The IPO comprises 25 million 20c ordinary shares and includes the iron ore prospects of Adelaide Resources Limited (ADN), which have been vended into the float so the explorer can concentrate on other resources.
The lodgement of the prospectus on 18 April coincided with the appointment of John McKee as Iron Road’s chairman. Dr McKee, a heavy hitter in the Victorian business community, was a former finance director of Shell Oil South Africa, chief operating officer of Santos Limited (STO), and corporate finance director of Telstra Corporation Limited (TLS).
His government appointments have included chairman of the State Energy Commission of Western Australia and Commonwealth Government appointee as Australia Resources Representative to the OECD in Paris.
He will take the helm of Iron Road along side the company’s managing director and mining engineer, Andrew Stocks, who has previously served as managing director and CEO of Siberia Mining Corporation.
Topping Iron Road’s asset list is the 100% owned EL 3699 Warramboo iron ore project on Eyre Peninsula in South Australia, which it acquired from Adelaide Resources.
Iron Road has issued 21 million shares to Adelaide Resources for consideration of the Warramboo project.
Iron Road said the 663 square kilometre iron ore tenement contains magnetite-bearing gneiss units at three distinct prospects that have cumulative strike length in excess of 50 kilometres.
The company said that tests of the Warramboo magnetite have returned an exceptionally high value average iron grade of 70.4%.
Dr McKee said Warramboo is known for its superior mineral qualities and high grade concentrate potential with low impurities.
“Significantly, the region enjoys good quality infrastructure including port, rail power and water,” he added.
Dr McKee said the goal was to build up a resource inventory at Warramboo to warrant stand-alone production.
The company said it was confident of securing a drilling contractor to commence an exploration campaign at Warramboo soon after Iron Road’s planned listing on the ASX in early June.
Iron Road has assigned $2.4 million to the project’s exploration scheduled in the first two year.
The company has also acquired a significant iron ore landholding in Western Australia close to Portman Limited’s (PMM) Windarling mine, a direct ship hematite ore operation that currently exports eight million tones a year.
Iron Road’s Windarling Peak project comprises a total of seven granted and applied for exploration and prospecting licences 85 kilometres north of Koolyanobbing.
Two other projects in the Murchison region are also included in the float portfolio.
Looking to potential markets, Dr McKee said it was intended that any development of economic deposits by Iron Road would feed the rapidly expanding pellet and concentrates markets of Asia, Europe and the Middle East.
“We will be developing our assets at a time the iron ore prices have increased 353% in the past five years,” he said.
“With demand curves showing every fundamental sign of long-term sustainability, Iron Road’s IPO and listing is timely and exhibits strong upside potential.”
However, the company did temper optimism.
“Whilst the prospects are exciting, an investment in Iron Road should be considered speculative,” the iron ore hopeful said.
The Iron Ore offer, which is not underwritten, is scheduled to close on 26 May with ASX listing slated for 9 June. The company said that oversubscriptions would not be accepted.
The Windarling Peak Project is located approximately 85km north of Koolyanobbing, Western Australia and consists of 3 granted exploration licenses and 4 prospecting license applications. This region has excellent infrastructure in place, with rail from nearby Koolyanobbing to the deepwater port of Esperance.
The primary banded iron formation in the Koolyanobbing Range, which has been strongly folded and thickened, is composed of banded magnetite-talc schist, quartz-magnetite containing some pyrite, and siderite – massive pyrite containing some specular hematite, magnetite and graphite.
The project is located in a significant iron ore producing area. The nearby Koolyanobbing Iron Project, operated by Portman Limited, has resources totalling 52.7Mt @ 63.49% iron, the majority of which are located between 2.5km to 7km from Iron Road’s tenements. Portman mines the deposits as a single operation, trucking the ore from Mt Jackson and Windarling to Koolyanobbing which is then railed to the port of Esperance for export.
Exploration activities will target the potential continuation of the windarling structure on Iron Road's tenements
Murchison Projects
The Company’s Murchison projects comprise two project areas,Wanmulla and Rose Hill. The Wanmulla Project is located approximately 50km east north east of Cue, in the Murchison Goldfield of Western Australia. The project covers the eastern edge of the Mount Magnet – Meekatharra greenstone belt in the vicinity of Tuckibianna. The Rose Well project is located approximately 60km north east of Mount Magnet, Western Australia. The majority of the lease is interpreted to be gneissic granitoids however there is outcropping banded iron formations as enclaves of greenstone within the central portion of the project. It is likely that further enclaves of greenstone are present.
Iron Road intends to investigate the potential of its Murchison projects, particularly beneath the surface alluvial and colluvium cover.
ASX Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
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