Aurox Resources Limited

Published : April 29th, 2008

Balla Balla Mineral Resources Upgrade and Drilling Progress

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29 April 2008

e-lodgement

Company Announcements Office

ASX Limited

2 The Esplanade

PERTH WA 6000

 

ASX / Media Announcement

 

BALLA BALLA MINERAL RESOURCES UPGRADE & DRILLING PROGRESS

 

  • 74 million tonnes of additional Measured & Indicated Resources delineated

from Central Pit & Eastern Block Phase 1 drilling

  • Ore Reserve estimation work on new Phase 1 resource models underway;

significant increases anticipated

  • Phase 2 drilling below Western Pit confirms magnetite mineralisation extends

to 427 metres - resource modelling to commence shortly

 

Central Pit & Eastern Block Mineral Resource Upgrades

 

Pilbara iron ore developer Aurox Resources Limited (ASX: AXO) is pleased to announced a significant upgrade to its Mineral Resource Estimate for the Central Pit and Eastern Block areas of its Balla Balla magnetite project.

 

The 74 million tonne resource upgrade (111 to 185 million tonnes ) follows completion of a 8,300 metre reverse circulation (RC) drilling programme in these two areas prior to Christmas (ASX Announcement 11 March 2008). The infill drilling targeted the Inferred Mineral Resources (lowest JORC confidence level) located immediately below the Central Pit and across the Eastern Block areas.

 

The aim was to upgrade these resources to Measured and Indicated categories in preparation for Ore Reserve conversion and subsequent pit design and mine scheduling. Golder Associates have now completed new 3D resource block modelling of the Central Pit and Eastern Block areas. Aurox Managing Director Charles Schaus said the new Mineral Resource estimate report shows successful and significant upgrades to the Measured and Indicated tonnages in these areas. “We have delivered a 64% increase in Measured and Indicated resources at the Central Pit and Eastern Block areas. We are now undertaking Reserve estimations on the new resource models and are anticipating significant increases,” Mr Schaus said.

 

The Central Pit Area Mineral Resources shown in Table 1 represent a tonnage increase of 29.8 million tonnes to the Measured and Indicated resources. The Eastern Block Mineral Resources shown in Table 2 represent 44.2 million tonnes of newly defined Measured and Indicated Resources. Previously only Inferred Mineral Resources were estimated via wide spaced drilling in the Eastern Block area.horizon, although assays are still pending.

 

TABLE 1- CENTRAL PIT AREA

Text Box: Class	 Mt 	Fe (%) 	V2O5 (%) 	TiO2 (%) 
Measured 	57.9	 40.6	 0.56	 13.2 
Indicated 	18.6	 39.8	 0.53	 12.8 
Inferred 	16.1	 39.8	 0.54	 12.7 
Total 	92.5	 40.3	 0.55	 13.0

 

 

 

 

 

 

 

TABLE 2 - EASTERN BLOCK AREA

Text Box: Class	 Mt 	Fe (%) 	V2O5 (%) 	TiO2 (%) 
Measured 	37.2	 40.9	 0.55	 12.6 
Indicated	 7.0 	40.9 	0.62 	11.5 
Inferred	 5.8 	41.0 	0.66 	11.1 
Total 	50.0	 40.9	 0.57	 12.2

 

 

 

 

 

 

 

The new Measured and Indicated Mineral Resources are now eligible for Ore Reserve conversion. Perth mining engineering consultant Orelogy Pty Ltd have commenced pit optimisation work and expect to report new Ore Reserve Estimates for the Central Pit and Eastern Block areas in two to three weeks time.

 

A plan map and corresponding long-section (Figure 1) shows the location of the new Resource Estimate updates relative to the entire Balla Balla magnetite deposit. The long-section also depicts the location of ‘target resource tonnages’ in anticipation of ongoing drilling.

 

As the 65,000 metre RC and diamond drilling programme progresses, the 3D block models will be updated and new JORC-compliant Mineral Resource and Ore Reserve will continue to be estimated and announced.

 

The resource upgrade is another milestone for Aurox, which is on track to become WA’s first magnetite iron ore producer from the low cost Balla Balla project, located near the Pilbara coast 100km west of Port Hedland.

 

Balla Balla Drilling Programme Update

 

Aurox is continuing the aggressive programme of RC resource drilling recommenced in January 2008 focusing on increasing the Mineral Resource within the Western Deposit and its strike extensions at Balla Balla.

 

During the first quarter a total of 18,152 metres of drilling (including 1,238 metres of RC precollar and 568 metres of diamond-core tail) was completed, covering the entire 3km strike of the Western Deposit, in addition to 0.4km of strike extension to the north-east and 1km of strike extension to the south-west.

 

The second phase of the Western Deposit drilling program has been completed, with each deep drill hole successfully intersecting the magnetite horizon, although assays are still pending.

 

A total of 132 RC holes were completed to an average vertical depth of 124m and a maximum depth of 234 metres. Six deep holes were drilled (by RC pre-collar and diamond tail) to a maximum vertical depth of 427 metres, spaced every 500 metres along the entire strike length of the Western Deposit. A cross section showing the project’s deepest hole to date, BBD044, is displayed in Figure 2.

 

To date, assay results have been received from 56 of the 138 holes drilled (see Table 3 for drilling result update). Recent drilling highlights include:

Text Box: HOLE 	FROM(m) 	WIDTH(m) 	Fe (%) 	V2O5 (%) 	TiO2 (%) 
BBR399 	78 	60 	47 	0.66 	14.9 
BBR403	 116 	80 	47 	0.67 	14.1 
BBR413 	94 	44	 49 	0.73 	14.9 
BBR415 	98 	62	 43 	0.62 	13.1

 

 

 

 

 

 

 

Upon receipt of all assays from the Western Deposit, the data will be delivered to Golder Associates to update and extend the existing 3D resource block model and to calculate a new JORC-compliant Mineral Resource estimate for the Western Deposit and its strike extensions.

 

Meanwhile drilling is continuing on Phase Three, which involves approximately 10,000 metres of RC drilling in the Central Deposit area. This drilling is planned to extend the down-dip Central Pit Area mineralisation by an additional 50 to 100 metres vertically along the entire strike length. This drilling should be completed during the June 2008 quarter.

 

Notes to accompany the results:

1) All holes drilled vertically; apparent intercept widths are quoted

2) Downhole samples were composited over 2m intervals through the ore zone and assayed by Genalysis Laboratories in Perth

3) Sample preparation: All samples were sorted, dried, then subjected to Single Stage Mix and Grind (SSMG) to nominal 1050 micron

4) Analytical methodology: Fused Disc X-Ray (suitable for ore grade material):- A sub sample is automatically determined for LOI and fused into a glass disc using a Lithium Borate flux with direct analysis using PANalytical Magix Fast Simultaneous X-ray system for the following element suites: Al2O3, CaO, Fe, Fe2O3, K2O, LOI @1000C, MgO, Mn, Na2O, P, S, SiO2, TiO2, Plus Traces: V Cr Co Ni Cu Zn As Sn Ba Pb

 

Reverse circulation drilling at Balla Balla with Depuch Island in background

 

(High resolution picture also available at http://www.purplecom.com..au/gallery.asp )

 

Competent Persons Statement

 

The Balla Balla Mineral Resources were estimated by Richard Gaze of Golder Associates Pty Ltd. Mr Gaze has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ’Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves.’ Mr Gaze consents to the inclusion in this report of the above Resource information in the form and context in which it appears.

 

The information in this report that relates to Exploration Result is based on information compiled by Matt Chinn who is a member of the Australian Institute of Mining and Metallurgy and a full-time employee of Aurox Resources Limited. Matt Chinn has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral resources and Ore Reserves. Matt Chinn consents to the inclusion in the report of matters based on his information in the form and context in which it appears.

 

About Aurox

Aurox Resources Limited (ASX: AXO) is a Perth based metals developer, with its primary asset the 100% owned Balla Balla iron ore concentrate project. The project is located near the coast west of Port Hedland in the renowned Pilbara region of Western Australia.

 

Aurox is well advanced in the development of Balla Balla, having completed a Bankable Feasibility Study for six million tonnes of magnetite iron ore production annually. The Company has in place two 15 year sales contracts for a total of 6 million tonnes per annum increasing to 10 million tonnes per annum concentrate production in year 5 with major Chinese Steel Companies. Balla Balla is based on a large homogenous magnetite ore body, which will be developed as one of the lowest cost magnetite operations in Australia. The project also has significant titanium potential, and is located near major ports, gas and grid power with main highway access.

 

The new Balla Balla Bankable Feasibility Study demonstrates strong project economics with magnetite iron ore shipments to China scheduled to commence in the second half of 2010.

 

Aurox Resources Limited

 

Charles Schaus

Managing Director

 

***

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Aurox Resources Limited

DEVELOPMENT STAGE
CODE : AXO.AX
ISIN : AU000000AXO6
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Aurox Res. is a gold and copper development stage company based in Australia.

Aurox Res. develops gold, copper, iron, titanium and vanadium in Australia.

Its main asset in development is BALLA BALLA in Australia and its main exploration properties are INDEE SOUTHWEST and YALGOO WADGINGARRA & CARLAMINDA in Australia.

Aurox Res. is listed in Australia and in Germany. Its market capitalisation is AU$ 143.1 millions as of today (US$ 145.4 millions, € 114.0 millions).

Its stock quote reached its highest recent level on July 20, 2007 at AU$ 1.55, and its lowest recent point on December 19, 2008 at AU$ 0.07.

Aurox Res. has 196 044 413 shares outstanding.

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