Base Resources (ASX:BSE) has published an updated resource estimate at the Ranobe zone, which is a part of its Toliara mineral sands project. This project in Madagascar was acquired about a year ago, and Base Resources has been working hard to complete economic studies on this project as it’s aiming to bring it into production.
Base made the decision to reduce the cut-off grade from 3% heavy minerals to 1.5% minerals, and this resulted in a 25% increase in tonnage to approximately 1.3 billion tonnes. Lowering a cut-off grade has a negative impact on the overall grade of a deposit, but with an average grade of 5.1% Heavy Minerals, the Ranobe resource appears to remain quite robust. Additionally, Base Resources has now also included two lower mineralized units (intermediate sand clay units) in the current resource estimate, and this has obviously also had a positive impact on the total size of the resource. Base is still drilling at Ranobe and this will very likely result in another resource update later this year, once all drilling has been completed.
Using the previously 3% cutoff grade, Ranobe would contain 1.02 billion tonnes at a grade of 5.78% Heavy Minerals. So reducing the cutoff grade to 1.5% has added approximately 270 million tonnes, but has reduced the overall grade on the entire 1.29 billion tonne resource by approximately 0.68%, or almost 12%. Considering the slime levels are relatively low (6% on average), Base Resources could probably get away with using a lower cutoff grade without endangering the economics of the project. The company is now working on a pre-feasibility study at Toliara, which should be ready for publication next month.