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Click here to view an independent NI 43-101 technical report (NI 43-101 Technical Report on the Preliminary Economic Assessment for 50 MTPY - Otelnuk Lake Iron Ore Project - Québec Canada for Adriana Resources Inc. prepared by Watts, Griffis and McOuat, Consulting Geologists and Engineers ) (pdf file - 9.36MB). The Report has been filed on www.sedar.com on April 8, 2011
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view Lac Otelnuk Property Fact Sheet
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| Location: |
Labrador Trough - Nunavik, Québec, Canada |
| Mineral: |
Iron (Fe) |
| Property Size: |
34,823 hectares |
| Project Status: |
Resource Definition |
| Current Project Activity: |
Work towards developing strategic partnership to advance to "Pre-Feasibility Stage"
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| Resource: |
4.40 Billion Tonnes Indicated; 0.49 Billion Tonnes Inferred at ~29% Fe (see below) |
| Ownership: |
Option to Acquire 100% |
Summary of National Instrument ("NI") 43-101 Mineral Resource Estimate (using a DTWR cut-off grade of 18%)
| Zone |
Tonnes
Billions |
%Fe
Head |
DTWR
% |
%
SiO2 |
%Fe
DTC |
| Indicated |
4.29 |
29.08 |
27.26 |
3.53 |
68.00 |
| Inferred |
1.97 |
29.24 |
26.55 |
3.51 |
68.12 |
Information provided by Magnus Erickson of Raw Materials Group, Stockholm, Sweden, a group which manages an extensive mining industry database, indicated that the mineral resource identified in the South Zone of Lac Otelnuk project currently ranks it in the "Top 15" of all known "world-class" iron deposits.
Of note, a single exploration hole drilled by Adriana in 2008, located 2,000 metres west of the baseline on Section 10 North, confirmed the significant western extension of the iron formation under a broad topographic high or ridge. This area was not previously explored, and the drill hole was lost before reaching the lower stratigraphic units."
Property Description
The Lac Otelnuk Iron Project is located 170 kilometers north of the town of Schefferville, Quebec. This town once served as a centre for the iron mining and processing operations of the Iron Ore Company of Canada. The northern terminus of the Quebec North Shore and Labrador Railroad, a common carrier, is located in Schefferville.
The property lies within the Labrador Trough, one of the largest iron ore belts in the world. The belt contains world-class iron deposits that have been continuously mined since 1954.
Historical Work Completed
The property was first explored in the early 1950s when a significant magnetite iron formation was mapped over a strike length of approximately 25 kilometres. Subsequent diamond drilling and surface sampling in the 1970s, which was largely limited to the upper iron formation unit, resulted in historic mineral resource estimates for two adjacent zones, the North and South. Magnetite occurs throughout this iron formation, with the North and South zones largely uniform in continuity of grade and thickness.
Lakefield Research (now SGS Minerals Services) of Lakefield, Ontario, carried out limited metallurgical test work on surface samples and drill core from the North Zone in 1971 and 1974. In addition, in 1976, an 18-long ton bulk sample was taken from the North Zone, of which approximately one long ton was shipped to a German laboratory for metallurgical testwork. This work was carried out in 1977. Finally, in 1981 Lakefield carried out testwork on another portion of the bulk sample. While the results from the two laboratories cannot be directly correlated, both prepared concentrates grading 65.1% to 70.6% Soluble Fe with weight recoveries up to 41.0%, acceptable results for taconite deposits.
Recent Activity, Work Programs & Going Forward
In 2010, Adriana completed 40 diamond drill holes and the 2007 and 2008 field seasons, Adriana drilled 67 diamond drill holes to test the 9 kilometre strike length of the South Zone of the Otelnuk Property. The results from the drill program confirmed a large, flat lying iron formation over an approximate area of 22.5 square kilometres. The targeted formation remains open along strike to the northwest and southeast. The North Zone, where drilling in the 1970s outlined the presence of a significant iron formation similar to that of the South Zone.
The Lac Otelnuk iron formation is open along strike to the northwest and southeast. It subcrops at surface and dips gently (from 2 to 5 degrees) to the northeast, eventually plunging under sedimentary formations. The western extent is terminated by erosion. Due to the gentle north-easterly dip and westerly sloping terrain, much of the sedimentary rocks that overly the South Zone have been stripped away by erosion, exposing the Upper Iron Formation.
In November 2010, Adriana contracted Met-Chem to produce a Preliminary Economic Assessment (PEA) of the Otelnuk iron ore property. The purpose of this report was to provide a preliminary assessment of the project's options and viability. The study assumes the development of an open pit mine, concentrator, and pelletizing facility with planned annual output of 50 million tonnes of pellets grading 67% -- 69% Fe for 75 -- 100 years.
The study also assumes that iron ore pellets will be transported via a newly constructed 815 km railway that will connect the processing facilities at Otelnuk with the port of Sept-Iles. The study purports that a new port facility at Sept-Iles is built and is capable of servicing 400,000 DWT vessels, and that a 240 km power line is erected between Brisay and Otelnuk. In total, the PEA report suggests total capex of $12.9 billion with first production to commence in 2016.
In May 2011, the Company commenced diamond drilling with the intent to further expand and upgrade the mineral resource and collect large diameter (PQ) core samples for grinding tests. The 2011 drill program contemplates 115 drill holes and, as of September 2011, the Company has drilled 71 holes and 10,475 meters.
In August 2011, the Company updated the NI 43-101 Mineral Resources estimate. In total the estimated defined a total of 6.5 billion tones.
Metallurgical testing is being carried out by SGS Minerals, and Golder Associates has been retained to undertake an Environmental and Social Impact Analysis of the Project.
A total of 178 diamond drill holes totaling 23,733 meters have now been drilled on the South Zone of the deposit since 2007, over a strike length of 9 km and cross section width of 2.5 km. The Lac Otelnuk deposit is very uniform, dips gently to the northeast and has a potential thickness of approximately 100 meters where the deposit has not been eroded. Approximately 75% of the deposit outcrops to the surface. The deposit is open along strike to the northwest and southeast and down dip to the northeast.
The Company's goal is to advance towards feasibility and subsequent development stage through the future potential partnership with WISCO International Resources Development and Investment Limited.
Mr. Frank Condon, P.Eng., a consultant of the Company and a qualified person as defined by NI 43-101, has reviewed and approved the technical disclosure of this information on Lac Otelnuk.
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