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Excellent iron ore drill results at Spinifex Ridge boost Moly Mines

Moly Mines, which is planning to develop the big Spinifex Ridge moly/copper deposit in Western Australia, is recording very significant near-surface direct shipping grade iron ore intersections immediately west of the main moly/copper deposit.

Author: Andrew McCrea
Posted: Wednesday , 20 May 2009

LONDON (Proactive Investors) -

Moly Mines Ltd (ASX:MOL) has delivered some significant and timely cheer to shareholders with results received from the March 2009 infill drilling programe at Spinifex Ridge Iron Ore Project located immediately west of its planned Spinifex Ridge moly-copper project in Western Australia.

Without putting too many superlatives to it, the following results show why Spinifex Ridge iron ore could prove to be a handy source of cash flow for Moly shareholders.

Significant results included:
- 40m @ 62% Fe from 37m
- 62m @ 63% Fe from 3m; including 14m @ 67% Fe from 24m
- 40m @ 64% Fe from 2m
- 46m @ 63% Fe from 41m; including 11m @ 66% Fe from 58m
- 41m @ 62% Fe from 37m
- 43m @ 62% Fe from 3m; including 13m @ 65% Fe from 21m

The company called the results, "outstanding" and it is not difficult to see why with these high grade intersections. With grades above 60%, the ore can generally be mined at lower cost and used in blast furnaces requiring only simple preparation.

Moly Mines is now fast-tracking studies for how best to mine and extract the material as Direct Shipping Ore. Initial internal targets are for a one million tonne per annum production operation, although this could be slightly increased over time. Even at current iron ore prices, this would prove a timely cash generator for the company, while it contemplates the bigger prize at the Spinifex Ridge Molybdenum Project, and evaluates other potential mining acquisitions.

It is understood that negotiations are advanced with interested parties to buy the Spinifex Ridge iron ore. It would be logical to assume that Moly Mines could look at selling the ore at the gate, delivering it to another producer's stockpile in the Pilbara.

The location of Spinifex Ridge's project is a major advantage with it being within trucking distance over paved roads from the major iron ore exporting infrastructure at Port Hedland, Western Australia.

The results were derived from a 27 hole RC drill program for 2,209m drilled to an average depth of 82m. The drilling was spread across 3 of the 4 prospects - Auton, Auton North East and Gallifrey, all of which occur on the Spinifex Ridge mining leases.

The majority of the drilling was targeted into the Auton North East prospect to expand and close off the mineralisation, with some further infill completed into the Auton and Gallifrey prospects. This program completes the majority of the RC drilling required to finalise a maiden Iron Resource estimate on these small but rich iron occurrences.

Published courtesy of Proactive Investors - www.proactiveinvestors.co.uk