FinnAust Mining shares rise as Pituffik development continues

The AIM-traded firm said the “successful test work” demonstrated an ability to produce a gravity-separated concentrate that compared favourably against existing 'hard rock' sources of ilmenite.

It said it achieved a separation capable of maintaining a commercially pure, high-grade concentrate, which it expected to positively affect capital and operating requirements moving forward.

The overall composition indicated the ilmenite should be readily soluble in sulphuric acid at high process efficiency, making it suitable for all digestion process options.

FinnAust’s chemical analysis showed a consistent ilmenite composition across the entire project area, with elements that could adversely impact final pigment quality - particularly whiteness and yellowness - comparable to existing commercial products.

Radioactive components and acid insoluble minerals were found to be “better than industry benchmarks” for sulphate ilmenite, with sulphate process production of titanium dioxide anticipated to be the key growth driver for the consumption of ilmenite ores in the coming years.

The company said further optimisation of the mineral separation flowsheet was expected to achieve material suitable for the chloride slag process.

Work was continuing towards determining the Pituffik resource potential, with a maiden JORC resource expected later tin year ahead of commencing bulk sampling in 2017.

“This is a big step forward in proving the commercial viability of Pituffik; metallurgical test work has shown that by using a simple gravity step we can produce a product that compares very favourably to ilmenite produced in hard rock mines,” said FinnAust CEO Roderick McIllree.

“Hard rock ilmenite projects require significant capital investment however in the case of Pituffik mechanical erosion has done all the work for us.

“This is expected to result in some compelling economics for the project.”

McIllree said the development further strengthened the board’s view that Pituffik represents a potential source of globally traded primary ilmenite requiring a small implementation footprint allowing for rapid development.

“The resource for Pituffik is expected in the next three to four months at which point we will quantify how much material we have.

“This will mark a significant milestone in terms of proving the project's potential.”

McIllree said the company now intended to review the mechanics of moving to 100% ownership of Bluejay Mining Limited, and hence Pituffik, on the back of the “very positive” development.

“This is a move that is in all shareholders best interests and we look forward to keeping the market updated with our progress in due course.”

At 1046 BST, shares in FinnAust Mining were up 5.52% at 7.39p.