Talon Metals (tlo-t) got a much needed boost with an initial resource on three target areas at its Trairao iron project in Brazil’s Para state.
The company’s shares jumped 20% to close Nov. 24 at 50¢, and gained another 6% the following day to end at 53¢ a share.
Talon has seen its share price tumble since hitting a high of $3.14 on March 29, before skidding to a 52-week low of 36¢ on Oct. 4.
The inferred resource for target areas 4, 5 and 6 comes at 103 million tonnes grading 29% iron, using a 25% iron cut-off grade.
The estimate prepared by Coffey International is based on 42 holes drilled during June and July 2011.
“This resource is in line with our expectations as target areas 4, 5 and 6 are peripheral extensions to the main resource on target areas 1, 2 and 3, and on which there is not extensive development of oxidized saprock and saprolite in this area,” said Eddie Scholtz, Talon’s president and CEO, in a press release.
The new resource adds about 9% to the existing total inferred resource of 1.1 billion tonnes averaging 36% iron for areas 1, 2 and 3.
Currently, Talon has two rigs turning on areas 1 to 3 to update the inferred resource into indicated by early 2012. During that time it plans to complete an inferred resource for areas 4 to 13, which it expects to upgrade into the indicated category by mid-2012.
Also in the second quarter of 2012, Talon Metals targets completing metallurgical and initial mining and infrastructure studies for Trairao, before finishing a scoping study on its 100%-owned project, situated within the Greater Carajas mineral province, which produces about 26% of Brazil’s iron ore.
In late 2012, Talon anticipates having a prefeasibility study for Trairao in hand. The company describes the 516-sq.-km project as a surface lateritic deposit underlain by banded iron formations (BIF).
On its other Brazilian iron ore exploration project, Inaja South, Talon continues to hit BIF mineralization. So far, it has completed 22 holes out of its 28-hole program. The other holes should be drilled by year end, with assays being announced in early 2012.