AMN - TANZANIA: THM resources increase at Fungoni

There has been a significant increase in total heavy mineral (THM) resources at the Fungoni project of Strandline Resources in Tanzania. Extension drilling of the northwest (NW) zone has resulted in a 38% increase in the total resource to 21.7 million tonnes @ 2.82% THM and a 27% increase in contained heavy mineral to more than 610,000 tonnes.

The drilling has also confirmed the continuity of the higher grade, zircon dominated upper zone at the recently discovered Fungoni NW extension zones.

The THM resource, calculated at a 1% THM cut-off, has increased by about 6 million tonnes from 16 million tonnes @ 3.1% THM. The previous HM resource was 480,000 tonnes.

The upper zone core of mineralisation comprises 10.8 million tonnes @ 4.8% THM for 472,000 tonnes of HM at a 1.5% THM cut-off, comprising 42.2% ilmenite, 18.3% zircon, 4.5% rutile and 1.2% leucoxene.

Strandline says there is a high degree of confidence in the updated mineral resource with 41% in the measured category and 59% indicated. It says both categories are suitable for ore reserve estimation and detailed mine plan optimisation.

The mining study, which is under way, will incorporate this new resource and targets a substantial improvement to the previous Fungoni study in terms of mining rate, HM tonnage, mine life and ultimately project economics.

Mine optimisation analysis by AMC Consultants confirms efficient mining from surface, targeting the higher-grade upper zone to achieve a significant improvement on the previous Fungoni engineering study in terms of a higher mining rate and increased tonnes of recovered valuable HM for the project.

Exploration continues in the broader Fungoni region with a surface geochemical sampling program of radiometric anomalies and known mineralised trends identifying prospective high-grade mineralized zones in close proximity to the project. Sample assaying and assemblage test work will commence soon, followed by Aircore drilling.

Strandline’s managing director and CEO Luke Graham said, “The company has doubled the size of the Fungoni Mineral Resource estimate since the start of the year, from 11 million to 22 million tonnes, and significantly increased the contained HM available for DFS level mine optimisation.

“The company expects strong conversion to ore reserve of the higher grade upper zones where the majority of valuable, high quality heavy minerals reside.

“The visual results from the recent soil sampling exercise in proximity to the Fungoni project is also encouraging, showing potential to further expand resources in the area over time.

“The company is excited by the near-term project potential of Fungoni as well as progress made on the company’s other strategic project pursuits in Tanzania in an improving mineral sands market.”

These factors coupled with the announcementthat Strandline has entered into a JV agreement with Rio Tinto regarding its’ suite of heavy mineral sands tenements in the southern region of Tanzania, including the Miteja, Kiswere, Sudi and Mtwara prospects, has led Argonaut to update its research coverage and price target for Strandline from 2.8 to 3.0 cents per share.

Argonaut says the agreement excludes the company’s northern tenements, which host the Fungoni and Tanga projects as well as the Mafia and Bagamoya prospects.

www.strandline.com.au