TECHNICAL REPORTS
Click to view the Technical Report Preliminary Economic Assessment of the Rose Central Deposit and Resource Estimate for the Rose Central, Rose North and Mills Deposits (PDF 13.7 MB)
LOCATION
The Kami Property is strategically located next to the mining towns of Wabush, Labrador City and Fermont. The property includes 305 claims in Labrador and 5 Quebec Mining Titles for a total of 7,625 hectares.
Kami is within close proximity to a road (~2.5km), a common carrier railway (~15km) and a hydro power station (~15.5km). The multi-user railway will transport the material to a deep sea port which will provide year round access to the global market.
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PRELIMINARY ECONOMIC ASSESSMENT
The PEA was completed by BBA Inc. located in Montreal, Quebec and Stassinu Stantec Limited Partnership located in St. John’s, Newfoundland & Labrador.
Highlights of the Rose Central Preliminary Economic Assessment include:
- Concentrate production rate of 8 million tonnes per year at a grade of 65.5% iron
- Commercial production commencing in 2015 with a mine life of 15.3 years
- Capital cost of US$989 million (excluding closure costs, sustaining capital & leased equipment)
- Pre-Tax IRR of 40.2%
- NPV (discounted at 8%) of US$3.07 billion
- Payback period of 2.7 years
- Total operating cost (excluding royalties) of US$44.87/tonne concentrate (averaged over the life of mine)
A Preliminary Economic Assessment is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the Preliminary Economic Assessment will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Alderon has not yet completed a Pre-Feasibility Study or Feasibility Study to demonstrate the economic viability of the Kami Property. Furthermore, no mineral reserves have been established on the Kami Property. Any statements regarding planned production rates, projected cash flows, payback period, IRR, NPV, construction timelines and production startup at the end of October 2015 assume that Alderon is or will be able to complete all of the required steps to bring the Kami Property into commercial production, including the completion of a Feasibility Study to demonstrate the economic viability of the Kami Property, the completion of the environmental assessment process, the conclusion of infrastructure agreements for railway transportation, power and access to port facilities and that Alderon obtains the necessary project financing to pay for the capital costs to develop and construct a mine at the Kami Property. There is no certainty that Alderon will be able to complete any or all of these steps and reference should be made to the “Risk Factors” and “Preliminary Notes – Special Note Regarding Forward-Looking Information” sections of Alderon’s Annual Information Form for the most recently completed financial year. Each of the milestones listed above is contingent upon the successful completion of the prior milestone.
The proposed site plan for the Kami Property, as prepared by BBA, can be viewed below :
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NI 43-101 RESOURCE ESTIMATE
The Watts, Griffis and McOuat Limited ("WGM") estimate includes an Indicated resource of 490 million tonnes at 30.0% iron and an additional Inferred resource of 598 million tonnes at 30.3% iron (refer to tables below for tonnage and grade details). Mineral resources that are not mineral reserves do not have demonstrated economic viability. The mineral resource is contained within three zones, Rose Central, North Rose and Mills Lake. The Rose Central zone has a currently defined strike length of 1,700 metres (m) and a true thickness of up to 320 m. Mills Lake is located 3.1 kilometres southeast of Rose Central and has a currently defined strike length of 1,500 m and a true thickness of up to 180 m. North Rose has a currently defined strike length of 1,600 m and a true thickness of up to 250 m. All three zones are open for expansion.
To view tonnage and grade details, click here.
CURRENT WINTER EXPLORATION
The 2012 winter drilling program is now complete. The program, which consisted of 12,300 metres of drilling in 32 holes, concentrated on infill drilling within the currently defined mineral resource estimate in the North Rose area. The goal of this program is to upgrade the current mineral resource into the Measured and Indicated categories in preparation for the Feasibility Study expected in Q3 2012.
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click here to view the
PREVIOUS EXPLORATION
At the end of 2011, roughly 45,000 m had been drilled on the Kami Project resulting in an NI 43-101 resource estimate of 490 million tonnes at 30.0% iron in the indicated category and an additional inferred resource of 598 million tonnes at 30.3% iron. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
CLAIM OWNERSHIP
Alderon has acquired a 100% interest in the Kami iron ore project from Altius by issuing 32,285,006 common shares to Altius as well as appointing John Baker (Chairman of Altius) and Brian Dalton (CEO of Altius) to the Alderon Board of Directors. Altius will also retain a 3% gross sales royalty on iron ore concentrate from the Kami Project.
GEOLOGY
The Sokoman Fm. also known as the Wabush Iron Fm. is the ore-bearing formation in the Wabush Lake-Mount Wright area. The formation conformably overlies the Wishart Fm. quartzite where it is present, but also locally shares its basal contact with the Denault Fm. dolomite. The Sokoman Fm. is subdivided into Lower, Middle and Upper Members.
The Lower Member (LIF) consists of a 0 - 75 m thick sequence of fine to coarse grained banded quartz - carbonate, and/or quartz - carbonate - magnetite, and/or quartz-carbonate (i.e. siderite, ankerite and ferroan-dolomite) - silicate ( i.e. grunerite, cummingtonite, actinolite, garnets), and/or quartz - carbonate - silicate - magnetite, and/or quartz -magnetite - specularite units. Mixtures of these units can occur both vertically and laterally. This member may contain iron ore locally.
The Middle Member (MIF) which forms the principal iron ore unit consists of a 45 - 110m thick sequence of quartz-magnetite, and/or quartz-specularite-magnetite, and/or quartz-specularite-magnetite-carbonate, and/or quartz-specularite-magnetite anthophyllite gneiss and schist units. Actinolite and grunerite rich bands can be present in this member. Martite can also occur in weathered zones by alteration of magnetite.
The Upper Member (UIF) consists of a 45 - 75 m thick sequence similar in composition to the Lower Member and can generally only be differentiated through their contact relationships with the overlying and underlying formations supported by detailed structural interpretations. The hydrous iron oxides, limonite and/or goethite, have been observed in all members of the Sokoman Fm. Limonite and/or goethite are present in weathered and fractured zones and are derived primarily from alteration of carbonates. Pyrolusite (MnO2) was also observed in all members of the Sokoman Fm. and is typically associated with surficial or supergene enrichment, extending to depth along and adjacent to fault and fractured zones.
HISTORICAL EXPLORATION
Airborne surveys were carried out in the 1970s and in 1978 LM&E carried out a lake bottom sediment geochemical program. In 1979, a limited four line (3,500 m) ground magnetic survey was carried out in the Mills Lake area and in 1979 LM&E completed one hole, (28m) in the Elfie Lake area. In 1982, a 51 m hole was completed in the same area with 2 m of oxide iron formation intersected. In 1985, LM&E carried out limited field work in the north part of the Altius ground.
In 2001, IOCC carried out an airborne geophysical survey and although the Altius claim area was recommended by SRK as a high priority area, no follow-up work is recorded.
ALTIUS EXPLORATION
Altius carried out reconnaissance mapping in 2006 and 2007 in conjunction with an airborne geophysical survey in 2007.
Work in 2008 included acquisition of satellite imagery, line cutting, 69.8 km of ground magnetic and gravity surveys, and 6,130 m of diamond drilling in 27 holes of which 24 were completed to bedrock.
click here to view 2008 drill results
Additional information about the Kami Project can be found in the technical report filed on SEDAR at www.sedar.com entitled “Technical Report Preliminary Economic Assessment of the Rose Central Deposit and Resource Estimate for the Rose Central, Rose North and Mills Deposits of the Kamistiatusset (Kami) Iron Ore Property, Labrador for Alderon Iron Ore Corp.” dated effective October 26, 2011.
Edward Lyons, P.Geo., is Chief Geologist of the Company and a Qualified Person as defined by National Instrument 43-101 for the above mentioned project. The QP is a member in good standing of the Association of Professional Engineers and Geoscientists of British Columbia (APEGBC) and the Professional Engineers & Geoscientists Newfoundland & Labrador (PEGNL) as a registered Professional Geoscientist (P.Geo.). Mr. Lyons has reviewed and approved the technical information disclosed above.
