BAOBAB RESOURCES PLC TEST WORK UPDATE
15 OCTOBER 2014
Metallurgical test work supports the viability of the Pre-Feasibility Study process flow sheet
Baobab Resources Plc (AIM: BAO) ('Baobab' or the 'Company') the exploration and development company focused on the Tete pig iron and ferro-vanadium project ('Tete Project') in Mozambique is pleased to provide an update on its bench and pilot scale metallurgical test work.
HIGHLIGHTS
• Direct reduction test work supports the viability of the 2013 Pre-Feasibility Study ('PFS') process flow sheet and has achieved up to 65% metallisation using coarse iron concentrate and local coal;
• Optimisation trials testing the direct reduction characteristics of pelletised iron concentrate and local coal has returned significantly improved results of up to 93% metallisation;
• The higher metallisation and consistent sizing of pellets would enhance kiln performance and furnace productivity, thereby improving operating costs; and
• Pilot trials have simulated a smelting operation where melting is achieved and a titanium slag generated and removed. The molten, vanadium bearing, hot metal is then refined to produce a vanadium rich slag and a pig iron. The tests confirm the following:
• That the titanium can be readily separated from the iron as a primary slag;
• That the secondary vanadium slag recovery stage has also proven successful, with in excess of 80% of the total vanadium reporting to the vanadium slag;
• The vanadium results are in line with global benchmark operations in New Zealand and
South Africa; and
• The final pig iron product reports very low impurities and is within commercial specifications.
Ben James, Baobab's Managing Director, commented: 'The results to date not only confirm the chosen technology route for the Tete Project in Mozambique, but have also identified areas where process optimisation has the potential to significantly improve the already robust economics of the
2013 PFS. In conjunction with various potential partners, we have been closely assessing opportunities
to reduce capital and operating costs, thereby further mitigating execution risk and improving investor returns.'
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ENQUIRIES
Baobab Resources
Ben James: Managing Director +258 21 486 404
Jeremy Dowler: Chairman +44 1372 450529
Frank Eagar: Finance Director +258 21 486 404
Grant Thornton UK LLP
Nominated Adviser
Philip Secrett / David Hignell / Jamie Barklem +44 20 7523 8308
Tavistock
Financial Public Relations
Emily Fenton / Nuala Gallagher +44 207 920 3150
ABOUT BAOBAB RESOURCES PLC
Baobab Resources is an exploration and development company focused on the Tete pig iron and ferro- vanadium project in Mozambique, in which the International Finance Corporation holds a 15% participatory interest. The Company has been listed on the AIM of the London Stock Exchange (ticker BAO) since 2007.
DIRECT REDUTION & SMELTING TEST WORK PROGRAMME
BENCH SCALE DIRECT REDUCTION & SMELTING TEST WORK: CSIRO
During the course of the 2012-2013 Tete Project PFS and subsequently in Q1 2014, the Company successfully completed a series of bench scale reduction and smelting test work programmes at the CSIRO laboratories in Australia. The test work trialled Baobab's coarse, -6mm iron ore concentrate (both fresh and oxidised) with thermal coal products from the Rio Tinto, Vale and Minas Revuboe operations to test reduction/metallization and smelting behaviours.
The direct reduction trials returned consistently high metallization results and the smelting test work demonstrated that the titanium could be readily separated from the iron and vanadium, confirming the viability of the PFS flow sheet. Please refer to RNS dated 11 April 2014 for a detailed summary of the CSIRO test work.
BENCH & PILOT SCALE DIRECT REDUCTION TEST WORK: FLS & MINTEK
Following on from the successful trials at CSIRO, the Company entered into a second phase of more detailed test work. Two large trenches straddling the Tenge resource block were excavated to an average depth of two metres to enable the collection of a c.15 tonne bulk iron ore sample. A -8mm iron concentrate was generated from the bulk sample at the Mintek laboratories in South Africa and, along with local coal and carbonate samples, despatched to the FLS laboratory in the United States of America to complete bench and pilot scale direct reduction trials. Parallel bench scale test work was completed at Mintek for quality assurance and control.
Trials achieved up to 65% metallisation, lower than the CSIRO test work, but in line with the benchmark Highveld Vanadium and Steel operation in South Africa and confirming the viability of the PFS flow sheet design, albeit at a slightly higher operating cost. Challenges were encountered with the quality and continuity of batch specification of the local coal products and it is apparent that some coal treatment (either partial charring or floatation) will need to be incorporated in final plant designs.
Optimisation trials testing the direct reduction characteristics of pelletised iron concentrate and local coal were also conducted at FLS and Mintek. The test work returned significantly improved results of
85% to 93% metallisation. Although the introduction of pelletising to the flow sheet would increase capital requirements, the consistent sizing and higher pellet grade (c.56% Fe as opposed to the 51%
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Fe of the coarse concentrate), coupled with the significantly higher metallisation achieved, would enhance kiln performance and furnace productivity, thereby improving operating costs.
PILOT SCALE SMETING TEST WORK: MINTEK
Pilot scale smelting trials were completed at Mintek laboratories in South Africa to investigate the behaviour of vanadium during smelting and subsequent oxidation treatment. The trials were designed to simulate a smelting operation where melting is achieved and a titanium slag generated and removed. The molten, vanadium bearing, hot metal is then refined to produce a vanadium rich slag and a pig iron.
Utilising a tilting furnace, c.45kg of pig iron product was successfully produced, clearly demonstrating at scale that the titanium can be readily separated from the iron as a primary slag. In this initial phase of titanium slag production, in excess of 85% of the total vanadium reported to the hot metal, which is in accordance with the bench scale test work completed at CSIRO.
Seven 200g samples of pig iron were then subjected to vanadium recovery test work using various additives and levels of oxygenation to determine optimised conditions for two larger (3kg and 0.5kg) tests to produce a sufficient amount of vanadium-rich slag for subsequent characterisation. This secondary vanadium slag recovery stage has also proven successful, with most samples recording in excess of 95% of the available vanadium reporting to the vanadium slag. These recovery results are in line with global benchmark operations in New Zealand and South Africa. A final slag of c.10% V2O5 was produced with additional optimisation test work required to achieve the targeted 15% V2O5.
Chemical analysis of the final refined pig iron alloy product returned an average grade of 99% Fe, with very low impurities, which is significantly higher than that of standard commercial pig iron specifications. Pig iron typically also contains a fixed amount of carbon which can be added to the hot metal at the end of the process to meet end user requirements. Assuming a final product containing
4% carbon, the test work results indicate that the total impurities would be less than 0.15% and the iron content of the pig iron would be about 95%.
The information in this release that relates to Exploration Results is based on information compiled by Managing Director Ben James (BSc). Mr James is a Member of the Australasian Institute of Mining and Metallurgy, is a Competent Person as defined in the Australasian Code for Reporting of exploration results and Mineral Resources and Ore Reserves, and consents to the inclusion in the report of the matters based on the information in the form and context in which it appears.
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