Canegrass Nickel Cobalt Project

The Company’s focus is on the development of a low capital, low operating cost process for the treatment of nickel laterite ores and the production of a nickel/cobalt intermediate product. The present market conditions for nickel indicate a nickel production deficit and strong nickel prices in the next few years. 

The Company intends to develop a mining operation and demonstrate the Heap Leach process to meet full bankable feasibility study requirements. This will involve a scoping and feasibility study, construction and operation of a trial Heap Leach operation, followed by a full scale mining and Heap Leach operation. The Company’s strategy is to create growth through the application of the heap leach process on the Canegrass deposit, and through the acquisition of previously well explored deposits that are amenable to treatment by this process.

The project is located close to the city of Kalgoorlie-Boulder with excellent civil infrastructure including roads, rail, gas pipeline and power. International port facilities are available at Esperance and Fremantle, which are both accessible by rail from the area. The Canegrass deposit is in an area of established mining operations supported by experienced and highly skilled local mining workforce.


PROJECT GEOLOGY 
The Canegrass Project is largely hosted within an extensive sequence of ultramafic lithologies which extend regionally over a strike length of approximately 50km. The south western portion of the project area is underlain by komatiites. The eastern and northern portions are largely underlain by the cumulate ultramafic lithologies of the Walter Williams Formation which is host to the majority of nickel mined at the nearby Cawse Nickel Operation. A thin west-north west trending dolerite dyke (the SM7 dyke) cross cuts the stratigraphy through the central portion of the project area.

Nickel mineralisation in the project area is entirely related to enrichment within the weathering profile caused by the release of nickel from silicate minerals (olivine) during the weathering process. As a consequence, the mineralisation often forms laterally extensive blankets of varying thickness and grade throughout the project area. 



DEPOSIT GEOLOGY
The weathering profiles of the ultramafic lithologies in the region typically develop several zones. These are often identifiable in drill hole logs, but are very clear from review of multi-element geochemistry. The different zones typically comprise a transported cover sequence, oxide zone of iron and silica enrichment, smectite zone where smectite clays are developed and the saprolite zone where magnesium rich clays are developed and is transitional into fresh basement lithologies.

Understanding the zones in the profile is crucial to determining the economic potential of the deposit, as the siliceous types of mineralisation can have their nickel content upgraded via an inexpensive beneficiation circuit as is currently operating at the Cawse Nickel Project. 

PROJECT BACKGROUND 
The Canegrass Project leases cover an area of 15.4 square kilometres. The Canegrass Project area adjoins the Heron Resources’ tenements and the operating Cawse Laterite Nickel Mine owned by Norilsk Nickel. Under an agreement with Wingstar, Nickelore will have first choice of development prospects from tenements M24/290 and M24/39 which holds extensive laterite nickel deposits, formerly part of the Siberia Nickel venture. Extensive geological work and subsequent data comes with the Mineral Rights. 

The Canegrass Project was subject to intensive exploration by Western Mining Corporation (now BHP Billiton) over a 35-year period. Some 3,000 holes were drilled totalling 60,000 metres as well as the mining of three small pits, providing a wealth of information on the deposit. During the late 1970’s WMC Resources extracted a total of 0.94Mt of ore at 1.32% nickel from the Siberia tenements.