VRX Silica Upgrades Arrowsmith Central Project’s MRE by 273%, Stock Soars

Australian-headquartered silica sand explorer, VRX Silica Limited (ASX: VRX), previously known as Ventnor Resources Limited, centers its activities on meeting the silica sand shortage across the world. On detecting the dwindling supply of silica sand in the Asia-Pacific region, the company decided to focus its operations into the silica sand sector. The looming shortage of silica sand in the Asian region has made Australian prospects more competitive.

VRX Silica holds five exploration projects in Western Australia, which are in a strong position to meet the growing demand for silica sand product. Three of its projects are targeted at silica sand – Arrowsmith, Muchea and Boyatup, while the other two, namely Warrawanda and Biranup, are prospective for other minerals.

In a recent update on the Australian Stock Exchange, the company has released the results of the aircore drill program concluded at its Arrowsmith Central Silica Sand Project, which was undertaken by VRX Silica during March 2019. Arrowsmith Central Project is a part of the Arrowsmith Project, which is situated 270km to the north of Perth.

The results demonstrated an upgrade in the Mineral Resource Estimate (MRE) for the Arrowsmith Central Project to a total of 76.5 Mt @ 96.8% SiO₂, which includes an Inferred Resource estimate of 48.3 Mt @ 96.9% SiO₂ and an Indicated Resource estimate of 28.2 Mt @ 96.6% SiO₂. The reported Mineral Resources were consistent with the JORC Code 2012.

According to VRX Silica’s Managing Director, Mr Bruce Maluish, the Arrowsmith Central Project is well- positioned for an exclusive logistics solution as it is traversed by the Eneabba-Geraldton rail line, which offers a direct connection to the Geraldton Port. He believes that the upgraded Mineral Resource has added to the company’s total inventory and will deliver alternative products for the foundry and glassmaking industries in Asia.

Recently, VRX Silica had also released the results of the aircore drill program completed at its Arrowsmith North and Muchea Project. As per the results, the MRE for the Arrowsmith North and Muchea Project have been upgraded to 771 Mt @ 98.0% SiO₂ and 208 Mt @ 99.6% SiO₂, respectively.

With the estimation of upgraded MRE at VRX Silica’s three project areas including Arrowsmith North, Arrowsmith Central and Muchea Project, the total silica sand resource inventory for the company now stands at:

As shown in the above table, the total Inferred and Indicated Resources at VRX Silica’s three Silica Sand Projects have now surpassed 1 billion tonnes.

Overview of Arrowsmith Central’s MRE Results

Last year in December, VRX Silica reported the maiden MRE for the Arrowsmith Central target area, prepared by CSA Global. The MRE for the Arrowsmith Central Deposit included an Inferred Mineral Resource of 28 Mt @ 97.7% SiO₂, reported in line with the JORC Code 2012 Edition.

The MRE results were based on 39 hand-auger drill holes, drilled for 98.6 metres that defined the modelled silica sand layer. The maiden MRE was obtained from the small portion of the tenement area, which was adequate for preliminary mining studies. Subsequently, VRX Silica planned for an aircore drilling over an increased area, which was expected to significantly increase the Mineral Resource.

The recently determined MRE for the Arrowsmith Central Project signals an overall increase of 273 per cent on the maiden estimate reported in December 2018. The table below shows the tonnage comparison of updated MRE with Maiden MRE:

Further Details on Upgraded MRE

In March this year, VRX Silica commenced the aircore drilling at its three project areas – Muchea, Arrowsmith Central and Arrowsmith North. The aircore drilling program was undertaken with an expectation to improve the JORC confidence within the Mining Lease applications and the tonnage of sand at both the Arrowsmith project areas.

In its latest announcement, VRX Silica cited that the Mineral Resource Estimate is wholly within the 100 per cent owned granted tenement E70/4987. The company expects that the majority of the Indicated Mineral Resource, which is primarily within the Mining Lease application area, will convert to Probable Reserves and a durable mining project.

The company informed that the updated MRE is contingent upon the results of the most recent drilling, and the former hand auger drilling is utilized to assist in the model estimation. The modelled extents are in conformity with publicly available soil mapping data and geologically logged drill data, limited to within the company’s nominated Arrowsmith Central target area.

Metallurgical testwork accomplished to-date affirms that this updated silica sand model is considered easily modifiable to upgrading by traditional screening and washing methods to generate a high-grade silica sand product with high mass recoveries. As per the company, the specifications of the high-quality silica sand product are likely to be appropriate for the foundry, glass making and ceramics industries.

The testwork completed to-date at the world’s leading sand testing laboratory in Cookstown, CDE Global confirmed that high-grade foundry and glass sand could be produced from the Arrowsmith Central Deposit. The testwork helped VRX Silica create a catalogue of products that can be generated from the Arrowsmith Central Deposit. The products are summarised in the below figure:

The Arrowsmith Central products stated in the catalogue had the following process plant recoveries:

• Arrowsmith - C20: Foundry Industry with 34 per cent Recovery.
• Arrowsmith - C50/CF400: Foundry/Glass Industry with 34 per cent Recovery.
• High TiO₂: Filter/Bunker Industry with 9 per cent Recovery.

Future Work

The aircore drill program enabled VRX Silica to announce an Indicated Mineral Resource for the Arrowsmith Central Project, which is expected to facilitate completion of the feasibility study and estimation of an Ore Reserve for the project. A favorable feasibility study will enable the project to advance through financing, mining approvals, construction and the initiation of mining operations.

VRX Silica is continuing with the procedure to conclude the Mining Lease Applications and the Environmental Approvals process at its Arrowsmith Central and North Projects.

Stock Performance

VRX is currently trading higher on the ASX at AUD 0.135, with a rise of 8 per cent by the close of market trading on 20^th August 2019. The stock has delivered an enormous return of 108.33 per cent during the last three months.

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