Between 2006 and 2014, Strike’s primary focus was on the development of its Apurimac Iron Ore Project in Peru, recognised as one of the highest grade, large-scale magnetite projects in the world with the potential to support the establishment of a significant 20 Mtpa iron ore operation.
Current adverse market conditions however have led the Company to suspend all development activities on this and its other iron ore projects in Peru whilst the Company examines a range of new strategies.
The Company holds a balance of approximately $6.97 million in cash as of 30 June 2016.
Peru Iron Ore Projects
The nature of the Apurimac Iron Ore Project deposit and the development work undertaken to-date define this project as a potentially strategic asset in Peru, which may, when market conditions improve, provide opportunity for the Company to restart operations or otherwise recover value.
The exceptionally high grade 57% Fe is almost twice as high as magnetite deposits developed in Australia; ore bodies are coarse grained and soft, resulting in cheaper processing costs once in production.
A prefeasibility study completed in 2008 and updated in 2010 on the Apurimac Project indicated clear potential for development of a world-class iron ore project:
- JORC Resource of 269Mt of iron ore at Apurimac of 57.3% Fe (142 Mt Indicated at 57.84% Fe and 127 Mt Inferred at 56.7% Fe).
- Mineralisation predominantly high-grade, coarse-grained magnetite providing comparatively high mass recoveries (>60%) at coarse grind size (>500 microns).
- Excellent exploration potential within current concessions with several targets containing ironstones grading >60%Fe in similar geological settings to main Opaban concessions.
- Base case of 20Mtpa of concentrate produced by open pit mining and processing 20 – 27Mtpa of ore with transport of the high grade (>66%Fe) product to the coast via a slurry pipeline for drying and shipment to customers.
- Attractive life-of-mine operating expenses (2010) of US$ 17 – 20 per tonne of product. · Estimated capital expenditure (2010) of US$ 2.6 – 2.9 billion, competitive with other major iron ore projects at the time.
An initial drilling program at Apurimac established 269 Mt resources of high grade, coarse-grained magnetite with an average grade of 57.3% iron. Of this, potentially 67 million of Direct Shipping Ore (DSO) at an average grade of 61.5% Fe has been identified.
In addition to the Apurimac Iron Ore Project, Strike holds the Cusco Iron Ore Project, which lies approximately 150km to the south – east of Apurimac. The Cusco project forms a potential secondary development target for the Company in Peru with an initial inferred resource estimate of 104Mt at 32.6% Fe.
Like at Apurimac, iron ore mineralisation at the Cusco project is coarse grained and dominated by magnetite, with high grades recorded. Preliminary metallurgical tests indicate a concentrate grade of >65% Fe could be produced from this ore using conventional grinding and magnetic separation processes.