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Zanaga Iron Ore Company Ltd. (LSE:ZIOC) is poised to become a “very significant iron ore producer” having one of the largest iron ore resources in Africa.
That is according to the miner’s Non-Executive Chairman, Clifford Elphick, following the release of a revised resource estimate of its deposit from the Zanaga Iron Ore Project in Congo (Brazaville).
In a statement, the firm said the iron ore deposits are now approximately 6.8 billion tonnes with an average of 32.5% iron, a 57% increase from the previous JORC-compliant resource estimate.
Out of the 6.8 billion tonnes, 2.4 million of which are counted in the measured category, a huge rise from 3% to 35%.
“The major increase in the resource announced today is exciting as it confirms the Zanaga Iron Ore Project has the potential to become a very significant iron ore producer with one of the largest iron ore resources in Africa,” Mr. Elphick stated.
The results came from over 176,000 metres of drilling at an average depth of 145 metres, including diamond drilling and reverse circulation drilling, done between August 2011 up to 15th July 2012 with about half of the targets still to be drilled.
Zanaga holds 50% less one share in this joint venture, with commodities giant Xstrata (LSE:XTA) effectively controlling the project by owning 50% plus one share.
Exploration of the steelmaking ingredient continues to be extensive even as the price of the commodity fell amidst a bleak global economic outlook, with iron ore producers looking forward to the longer term demand, especially with the sustained growth in emerging economies.
On the Alternative Investment Market, the news was welcomed by a 7.1% rise in share price to 60 pence by 10:00 AM GMT, three hours after the announcement was released.
Company Spotlight
Zanaga Iron Ore Company Ltd., was incorporated in the British Virgin Islands with the primary asset in Congo (Brassaville).
