A first resource for Alderon Resource‘s (ADV-V) Kamistiatusset (Kami) iron ore project in western Labrador has established a global resource of 608 million indicated and inferred tonnes.
The Kami project sits roughly 6 km east of Consolidated Thompson’s Bloom Lake iron ore deposit and about 10 km southwest of the town of Wabush. The resource estimate includes the Rose Central zone and the Mills Lake zone 3 km to the southeast.
Rose Central, with a defined strike length of 1.7 km and a true thickness of up to 320 metres, is estimated to contain 376.1 million indicated tonnes grading 29.8% total iron, or 26.9% oxide iron, and 46 million inferred tonnes of 29.8% total iron, or 27.2% oxide iron, both using a 20% cutoff.
Mills Lake, with a defined strike length of 1.5 km and a true thickness of up to 180 metres, is estimated to contain 114.1 million indicated tonnes averaging 30.5% total iron, or 27.8% oxide iron, and 71.9 million inferred tonnes averaging 30.7% total iron, or 28.2% oxide iron, using the same cutoff.
The resource estimate is based on 24,000 metres of drilling over 68 holes, while both zones are open to expansion.
The project straddles the Labrador-Quebec border, with 47.8 sq. km in Labrador and 1.3 sq. km in Quebec. Duley Lake Provincial Park sits just north of the property.
According to a technical report, mineralization consists mainly of semi-massive bands, or layers, and disseminations of magnetite and/or specular hematite in recrystallized chert and interlayered with bands of chert with minor carbonate and iron silicates. The hematite-rich rock has occurrences of manganese that could be a concern for the production of concentrates.
Alderon has $16.1 million in planned spending for 2011, including a 5,000-metre winter drilling program that should wrap up shortly, 25,000 metres of definition drilling and a scoping study.
Prospect generator and royalty company Altius Minerals (ALS-T) holds 39.3% of Alderon shares, while Alderon is also backed by Forbes & Manhattan. Altius started exploring the property in 2006 before optioning it to Alderon and still holds a 3% net sales royalty.
Alderon’s share price climbed 17¢ on the day the resource was released, and 43¢ the day before, to close at $4 even. The company hit a 52-week trading high of $4.20 in February after climbing from a low of 85¢ last July. As of April 1, Alderon had 82.2 million shares outstanding and $22.5 million in working capital.
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