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Publishing Date
24 Nov 2010 11:38am GMT
Mining Journal

Cliffs Natural Resources Inc has confirmed its funding commitment to the Decar project of Vancouver-based First Point Minerals Corp.

What lifts this announcement above the ordinary is the nature of the mineralisation at Decar, a property just to the northwest of Fort St James in British Columbia. The mineral is awaruite, a naturally-occurring alloy of nickel and iron with a composition from Ni2Fe to Ni3Fe.

Awaruite occurs in river placer deposits derived from serpentinised peridotites and ophiolites. This highly magnetic and dense (SG 8.2) mineral was first described in 1885 at Gorge River, Awarua Bay in New Zealand. The mineral composition at Decar is Ni3Fe (75% Ni and 25% Fe).

With no obvious features, the mineral is famously hard to locate, and there are only some 50 other known deposits in the world (none of which have been adequately tested).

Mining of the widely, and uniformly, disseminated mineral would be similar to that of a copper porphyry, ie bulk-tonnage extraction of low-grade near-surface material. Processing would involve simple magnetic and gravity separation, with no flotation necessary and no sulphur to complicate delivery of a final product.

Under an option agreement reached last November, Cliffs can earn a 51% stake in Decar by spending US$4.5 million over a four-year period. By end-September the company had already spent C$1.4 million.

Pursuant to this arrangement, Cliffs is to spend an additional US$500,000 over the coming year. The work will include the investigation of mineral-processing methods using several tonnes of core recovered from a ten-hole programme earlier this year.

This year's work programme included 2,573m of drilling in the Baptiste and Sidney targets, with seven holes containing "long, continuous intersections of nickel-iron-alloy mineralisation, with nickel-in-alloy grades ranging from 0.105% to 0.147%, over lengths of 163-328m.

Peter Bradshaw, the president and chief executive officer of First Point, commented that First Point holds five other awaruite properties within the same ultramafic unit to the north of Decar.

The company also holds several gold-silver properties in Mexico and Honduras. Indeed, the awaruite at Decar was first identified in 1998 when First Point was drilling for gold. At that time the low-grade deposit was not thought likely to be economic because of the low nickel price.

The economics have improved because of the better price for the two constituent metals, and the discovery of zones of higher grain size, which are expected to make processing easier. No smelting/refining would be necessary, and First Point expects to be able to deliver a concentrate direct to steel mills.

Dr Bradshaw told Mining Journal that at the current average awaruite grade of 0.126%, and an 80% recovery (still to be confirmed), the mineralisation had a likely net delivered value of some US$20/t, which is above that of most copper porphry deposits.

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