(MENAFN- ProactiveInvestors - Australia) Highfield Resources (ASX:HFR) continues to intersect high grade potash at the Muga Project in Spain as part of infill drilling designed to further enhance confidence in the Resource that will be its first mine target.
Significantly, two of the new holes have effectively pushed the potash resource into the northern section of the evaporite.
Drilling at the wholly-owned Muga Project is focused on relatively shallow PAB potash (sylvinite) beds in the combined Muga-Vipasca Project that covers an area of more than 110 square kilometres.
Mineralisation starts at depths of less than 200 metres and appears to be ideal for a relatively low cost conventional mine accessed via a decline.
Final assays from the two additional drill holes in the shallow south eastern section are:
- J14-02: 2.1 metres at 16.1% K2O from 187.3 metres, 2.1 metres at 13.3% K2O from 205.9 metres and 1.5 metres at 15.2% K2O from 210.7 metres; and
- J14-04B: 4.2 metres at 9.1% K2O from 289.1 metres.
Samples are also been selected for assay from hole J13-15, which intersected significant potash mineralisation at 238 metres.
In addition, both J14-02 and J13-15 are located in the northern section of the evaporite and effectively push the potash resource into this area.
Drill holes J14-10 and J14-11 are currently being drilled.
The project remains on target to be in a construction ready position by the third quarter of the 2015 calendar year.
Muga Potash Project
Highfield's flagship Muga Potash Project seeks to develop the relatively shallow PAB potash (sylvinite) beds in the combined Muga-Vipasca Project that covers an area of more than 110 square kilometres.
These appear idea for a relatively low cost conventional mine accessed via a decline.
Infill drilling will enhance confidence in the Resource that will be the subject of the company´s first mine target.
Results from the drilling will also be included in an updated and upgraded JORC Resource to be released this quarter.
The upgrade will be prepared by independent resource and engineering consultant, Agapito Associates.
The block model completed during this process will then be used for final mine design to facilitate the completion of the Definitive Feasibility Study.
Definitive Feasibility Study (DFS)
Due to drilling success into the south eastern section of the Muga Project area post the completion of the PFS, the Company is now considering operating two declines into the mine to take advantage of the additional mineralisation.
This dual decline strategy is likely to result in the Company operating two mining fronts which is expected to reduce project mining risk, advantage processing by reducing mineralisation variability and ramp up times and ultimately provide for increased production.
In addition, it will enable the Company to simultaneously target higher grade resource areas that are likely to include areas around DDHs J14-06 and J14-07. This is likely to enhance production in the early mine years.
With this, the Company now expects the DFS to be completed in Q1 CY2015.
The Company remains on target to be in a construction ready position by Q3 2015 Calendar Year.
Mining Concession Application
The mining concession application for the Muga mine is expected to be lodged in the current Quarter.
The mining concession application requires extensive documentation and includes an Environmental Impact Assessment (EIA) and Mineral Extraction Plan.
The environmental approval process was initiated in May 2014 when the Company lodged its Memoria Resumen (EIA statement of intent) with the provinces of Aragón and Navarra and the Central Government in Madrid. The responses to the Memoria Resumen are currently being incorporated into the EIA.
Analysis
Highfield Resources continues to intersect high grade potash at its Muga Project, providing further confidence in the resource that will be the first mine target.
Significantly, two of the new holes are located in the northern section of the evaporite and effectively push the potash resource into this area.
This is likely to be very positive for the JORC Resource upgrade.
An updated and upgraded JORC Resource for the combined Muga-Vipasca project, which includes the results from the entire infill drilling program, is due this Quarter.
Another takeaway is that Highfield remains on target to be in a construction ready position at Muga by Q3 2015 Calendar Year.
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