The company plans to update its mineral resource statement at the end of each drill campaign.
Australian Vanadium Ltd (ASX:AVL) (FRA:JT71) (OTCMKTS:ATVVF) has started drilling at its flagship The Australian Vanadium Project in Western Australia as its refines pit design and seeks to define a high-grade zone.
The West Perth company is undertaking a feasibility study for the project and recently raised $6.6 million towards its efforts.
It has now started funded drilling in a pre-feasibility study (PFS) pit design area as its project team hopes to refine the structural model.
AVL is also hoping to obtain additional resource and geotechnical data to support its pit design.
A number of campaigns
The company has planned a number of drilling campaigns over the next 12 to 18 months and also intends to drill southern extensions at the project during the extended period.
It will update its mineral resource inventory at the end of each drill campaign.
Australian Vanadium managing director Vincent Algar highlighted the value of the project, saying “The Australian Vanadium Project has unique geology and metallurgy.
“AVL holds a significant strike position and we have the opportunity to use that to define new reserves and increase the mine life substantially.
“Our targeted project investors will appreciate a de-risked, large resource base, with built-in flexibility for shallow open-pit mining.”
Low-cost of conversion of resources
Australian Vanadium’s December 2018 PFS modelled a 17-year mine life where 1.4 million tonnes of ore was mined each year.
The company is focusing on shallow infill drilling with its latest campaign, expecting to convert resources to reserves at a low cost while drawing on funds from its recent capital raising.
It said, “The identification of additional surface transitional ore along the strike allows more options for satellite pits to be included in the mine schedule, increasing the flexibility in mining.
“The option to blend-in greater percentages of transitional and fresh material earlier in the mine schedule could also be beneficial.”
AVL is not expecting its drilling work will affect the existing timetable of its feasibility study and approval activities.
More resources below the pit
The company’s 2018 PFS had defined an ore reserve of 18.24 million tonnes 1.04% vanadium.
This was made up of a proved reserve of 9.82 million tonnes at 1.07% vanadium and a probable reserve of 8.42 million tonnes at 1.01% vanadium.
The December 2018 reserve was derived from a resource inventory that consisted of 10.2 million tonnes at 1.11% measured vanadium resources and 12.1 million tonnes at 1.05% indicated vanadium resources.
In addition to the resources that form the reserve, there are another 3.3 million tonnes of indicated resources at 1.04% vanadium and 8.9 million tonnes of inferred resources at 0.98% vanadium beneath the team’s current pit optimisation.
AVL puts the size of the total resource in the fault blocks where the pit is designed at 36.3 million tonnes grading 1.04% vanadium.
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