Speewah Metals LtdMetallurgical studies support the worlds...

Speewah Metals Ltd

Metallurgical studies support the worlds largest titanomagnetite deposit being able to produce an attractive suite of premium products


A report from Ocean equities in London.
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News

Speewah Metals Limited (‘Speewah’ or ‘the Company’) has announced the latest, second stage set of metallurgical results which confirm the ability to achieve very high recoveries, and produce very high grade and pure Titanium, Vanadium and Iron from its Speewah Dome titanomagnetite deposit. Key results include:

· Ti recovery of 91.1% from concentrates to produce TiO2 product with indicative purity +99.5% TiO2;

· V recovery of 94.6% to produce V2O5 product with indicative purity +94.0 V2O5; and,

· Fe recovery of 97.0% to produce Fe2O3 product with indicative purity +99% Fe2O3.

The results follow a 10 month hydrometallurgical programme conducted by Process Research Ortech Inc. and a preliminary process flow sheet has been designed. Work is now being completed to provide a scoping study level of estimated capex/opex costs for a modular development approach, which is expected to be announced later this month.



Ocean Comment

Detailed metallurgical studies to date have identified that the titanium, vanadium and iron metals readily dissolve in mixed chloride acid solutions over 120 minutes, at 70°C and at atmospheric pressures. This supports the potential to mine the massive resources at the Speewah Dome and produce a concentrate at a grade of 14.8% Titanium, 2.48% Vanadium, and 54% Iron, acid bath the concentrate to dissolve the metals, and then recover three products (revenue split ~50%:35%:15% Titanium Dioxide: Vanadium Pentoxide: Hematite) from solvent extraction and acid regeneration methods.

The Company has conceptualised a development at Speewah that produces 75,000tpa of TiO2 products with high grade V2O5 (target production 13,000tpa) and Hematite (Fe2O3) (target production 400,000tpa), which at current spot prices would generate annual revenue in the order of ~US$500m and is not limited by resource size for future growth. The proposed processing flow sheet will be further optimised, and product quality and recoveries confirmed, by pilot plant testing over the coming 6 months.

The results of the 2011 field season are expected to lead to an increase in Speewah’s resource from the already huge 3.6Bt (an in-situ titanium/vanadium metal value of +A$1trillion) towards ~6Bt making it the largest JORC (or equivalent) titanomagnetite deposits in the world, with ~2Bt of this resource expected to be in Measured and Indicated categories. The Company is currently capitalised at only


News Flow & Catalysts

The first quarter of 2012 is expected to be a transformational period for the Company with further positive news flow expected. The following key developments are expected to highlight the truly strategic nature of the Speewah Dome project and significantly de-risk the Company’s development plans:

· Significant resource upgrade – The existing 3.6Bt JORC resource is expected to increase +50% towards ~6Bt making it the largest titanomagnetite deposit in the world, with ~2Bt in Measured and Indicated categories.

· Positive initial scoping level cost estimates – Due to the favourable met results and flat lying nature of the orebody the economics of the project are expected to be very compelling. Speewah is looking to undertake a modular development approach thus supporting a capex profile that the Company believes it will be able to fund, joint venture or sell at attractive levels.

The announced met tests, and soon to be released scoping level cost estimates, will address the question of what exactly is the Speewah Dome project. Currently it is viewed as a polymetallic vanadium/PGM/CU/titanium/iron project, but it will become clear that the base line development project is a predominately titanium project with vanadium and attractive iron ore credits of a truly strategic scale.

In 2Q’12, the Company plans to commence pilot plant testwork to optimise the current flow sheet, prove its concept and advance discussions with offtake and strategic partners before a full Feasibility Study is completed by year end. In addition, application for environmental permits and a mining lease are expected to take in place in 2012.

The Company is attending the London Rare Earths Speciality & Strategic Metals Investment Summit (March 13th-14th) and Hong Kong Mines & Money conference (March 20th-23rd).