Arrowsmith Silica Sand Project

In October 2017, VRX Silica announced the acquisition of the Arrowsmith Silica Sand Project, located 270 kilometres north of Perth in WA. The project sits across five exploration licences totalling approximately 377 km2 adjacent to the Brand Highway and the rail connection to Geraldton Port, which is suitable for bulk shipping.

Silica sand is the primary component of all types of standard and specialty glass and is also used for metal casting, metal production, chemical production, paint and coatings, ceramics, filtration and water production, and oil and gas recovery. Construction sand is the primary structural component in a wide variety of building and construction products.

Preliminary reconnaissance work on the Arrowsmith Project indicated substantial potential for sand suitable for use in both glassmaking and construction, supplies of which are in increasing demand as a result of booming technology and construction sectors in the Asia-Pacific region.

Project Location

Three areas within the Arrowsmith Project have had preliminary investigations:

  • Arrowsmith North for construction sand, which may also be upgraded to glass quality;
  • Arrowsmith Central, which is prospective for sand and limestone, and
  • Arrowsmith South, prospective for high-quality silica sand.

VRX Silica applied for three exploration licences north of Eneabba, Western Australia, which are shown below.

 

The location is traversed by the Eneabba-Geraldton rail line, which provides direct access to the ship-loading facilities at the Geraldton Port and offers a unique logistics solution.

Arrowsmith Silica Project Location Map

 

Arrowsmith North

During March 2019 VRX Silica completed an aircore drill program at the Arrowsmith North Silica Sand Project over the area previously tested only by shallow hand auger drilling.  The analytical results were used to update the Mineral Resource Estimate for the Arrowsmith North Project.

As announced on 9 July 2019, the MRE for the Arrowsmith North Silica Sand Project was upgraded to 771 Mt @ 98.0% SiO2 including an Indicated Resource estimate of 248 Mt @ 97.7% SiO2 and an Inferred Resource estimate of 523 Mt @ 98.2% SiO2.

This was an overall increase of 398% on the maiden estimate and confirms the Arrowsmith North silica sand Mineral Resource is a world class deposit. 

All Mineral Resources are reported in accordance with the JORC Code 2012.

Significantly the Mineral Resource includes an unpredicted 313 million tonnes of white sand at 98.7% silica. A high-grade final product can be produced from the higher-grade feed stock which is in demand for the glassmaking, foundry and ceramics industries.

This Mineral Resource estimation will allow the Company to finalise estimates of Ore Reserves which will support the impending BFS.

The Indicated Mineral Resource is predominately within the Mining Lease application area and the majority is anticipated to convert to Probable Reserves and hence an extremely long-life mining project.

No more drilling is required before the Company commences mining operations.  However, the Company will undertake a further testwork program on the white sand.

The Arrowsmith Project area has a mining depth limitation to be above the water table which is 10 metres below the drilling. The MRE has been estimated to a nominal depth well above the water table and the top half metre of topsoil has been discounted in the MRE as it will be used for rehabilitation.

Process circuit design and engineering has been completed, allowing for processing plant capital cost to be estimated at $18m per plant and total capex (including plant feeder and water supply per plant) estimated at $25m per plant.

Classification Domain Million Tonnes SiO2% Al2O3% Fe2O3% TiO2% LOI%
Indicated White Sand 33 98.7 0.50 0.20 0.20 0.20
Yellow Sand 215 97.5 1.10 0.40 0.20 0.50
All Sand 248 97.7 1.00 0.40 0.20 0.50
Inferred White Sand 280 98.7 0.50 0.10 0.20 0.20
Yellow Sand 243 97.7 1.00 0.40 0.20 0.50
All Sand 523 98.2 0.80 0.30 0.20 0.40
Indicated + Inferred White Sand 313 98.7 0.54 0.15 0.18 0.24
Yellow Sand 458 97.6 1.08 0.40 0.17 0.52
All Sand 771 98.0 0.86 0.30 0.17 0.41
*Note: Interpreted silica sand mineralisation is domained above a basal surface wireframe defined based on drill logging data. The upper (Topsoil) layer within 0.5 m of surface is depleted from the modelled silica sand unit, being reserved for rehabilitation purposes. All classified silica sand blocks in the model are reported. Differences may occur due to rounding.

 

The Mineral Resource announcement for Arrowsmith North, including JORC Table 1 information, can be found here. And replace the destination for this link  to be the ASX Announcement of 9 July 2019; ‘Arrowsmith North Mineral Resource Estimate Upgrade

 

Arrowsmith Central

At the Arrowsmith Central Prospect, a maiden Inferred Mineral Resource of 28Mt @ 97.7% SiO2 was announced in December 2018, based on an exploration program of 39 hand auger drill holes.

The Department of Mines, Industry and Safety (DMIRS) has granted a POW for exploration on the Company’s Arrowsmith Central Project to infill and extend the Arrowsmith Central Inferred Mineral Resource with the intention of upgrading areas of the Mineral Resource to an Indicated category.

This drilling will be done by an aircore drill rig, which will allow the full depth of sand to be drill tested as it will not have the depth limitations of the hand auger.

The required heritage survey has been completed and drilling will commence once the ground has dried out to conform with VRX Silica’s Dieback Management Plan, which has been accepted and added to the tenement conditions for the POW areas by the DMIRS.

A further iteration of testwork at Arrowsmith Central has been conducted by CDE Global using a refined flowsheet to incorporate additional attritioning to further improve the quality of the potential final products.

 

Classification Million Tonnes SiO2% AI2O3% Fe2O3% K2O% LOI% TiO2%
Inferred 28 97.7 1.2 0.3 0.3 0.5 0.2
Total 28 97.7 1.2 0.3 0.3 0.5 0.2

The Mineral Resource announcement for Arrowsmith Cerntral, including JORC Table 1 information, can be found here.

Exploration Targets

Exploration Targets for potential high-grade silica sand have been generated for two areas within the Arrowsmith Project; Arrowsmith Central and Arrowsmith South.

Arrowsmith South Exploration Target – 40 million to 80 million tonnes @ +95% SiO2.

The Arrowsmith South Exploration Target focuses on the southern end of a topographical high that is noted as containing an intercalation of limestone and dune sands and avoids existing infrastructure and potential conservation areas. The potential volume is estimated from the 45mRL to the top of the dune and assumes that between 50% and 100% of the dune is silica sand. The estimate uses an in-situ bulk density of 1.5t/m3 to calculate the tonnage. The target grade of +95% SiO2 is considered conservative as assays from all samples taken from the area exceed this value and processing is expected to increase this grade.

The potential quality and grade of the Exploration Target is conceptual in nature and there has been insufficient exploration to estimate a Mineral Resource and that it is uncertain if further exploration will result in the estimation of a Mineral Resource.

 

 

 

Arrowsmith North Exploration Target – 100 million to 140 million tonnes @ +95% SiO2.

The Arrowsmith North Exploration Target focuses on a prominent broad dune structure, see above, and avoids existing infrastructure and potential conservation areas. The potential volume is estimated from the 40mRL (surrounding RL) to the top of the dune and assumes that between 70% and 100% of the dune is silica sand. The estimate uses an in-situ bulk density of 1.5t/m3 to calculate the tonnage. The target grade of +95% SiO2 is considered conservative as all samples, except two, taken from the area exceed this value and processing is expected to increase this grade.

The potential quality and grade of the Exploration Target is conceptual in nature and there has been insufficient exploration to estimate a Mineral Resource and that it is uncertain if further exploration will result in the estimation of a Mineral Resource.

Arrowsmith South Exploration Target – 40 million to 80 million tonnes @ +95% SiO2.

Arrowsmith South Silica Sand Exploration Map

The Arrowsmith South Exploration Target focuses on the southern end of a topographical high that is noted as containing an intercalation of limestone and dune sands, see above, and avoids existing infrastructure and potential conservation areas. The potential volume is estimated from the 45mRL to the top of the dune and assumes that between 50% and 100% of the dune is silica sand. The estimate uses an in-situ bulk density of 1.5t/m3 to calculate the tonnage. The target grade of +95% SiO2 is considered conservative as assays from all samples taken from the area exceed this value and processing is expected to increase this grade.

The potential quality and grade of the Exploration Target is conceptual in nature and there has been insufficient exploration to estimate a Mineral Resource and that it is uncertain if further exploration will result in the estimation of a Mineral Resource.

 

Future Work

At Arrowsmith North, the Company has an approved program of works to infill the Inferred Mineral Resource with the intention of upgrading the Mineral Resource to category.

This drilling will be done by an aircore drill rig, which will not have the depth limitations of the hand auger, and the full depth of sand will be drill tested. The drilling program will consist of 105 holes with an average depth of 11.3m (in comparison, the average depth of hand auger holes was 3.8m).

The drill program is expected to commence early in 2019 due to limited drill rig availability and the requirement for native title heritage clearance.

A further iteration of testwork at Arrowsmith Central has been commenced by CDE Global using a refined flowsheet to incorporate additional attritioning to further improve the quality of the potential final products.

Process circuit design and engineering will then follow, allowing for capital cost estimates to be generated in the first quarter of 2019.

The Company has an approved program of works and has completed a required heritage survey to infill and extend the Arrowsmith Central Inferred Mineral Resource with the intention of upgrading areas of the Mineral Resource to an Indicated category.

This drilling will be done by an aircore drill rig, which will allow the full depth of sand will be drill tested.

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