From Awareness Times Newspaper in Freetown

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Marampa Can Achieve Late 2012 Start-Up With Maiden 200mt Jorc Resource Representing Only 20% Of The Mineralised Strike
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Nov 19, 2010, 17:10

Australian resources and investment company, Cape Lambert Resources Limited (ASX: CFE) (“Cape Lambert” or the “Company”) continues to advance its 100% owned Marampa Iron Ore Project (“Marampa Project” or “Marampa”) in Sierra Leone, West Africa (refer Figure 1) towards a possible late 2012 production start­up, with the Company announcing a maiden JORC compliant Inferred Mineral Resource at the Marampa Project of 197 million tonnes at 28.5% Fe (above a 15% Fe lower cut-off).

The Marampa Project is a hematite iron ore project uniquely leveraged to a rapid “and low risk pathway to production, via existing rail and port infrastructure that is currently being refurbished (refer ASX announcements 6 April 2010 and 15 October 2010).

Commenting on the maiden JORC resource estimate for Marampa, Mr Tony Sage, Executive Chairman of Cape Lambert, said:

Chris Gbyl|: Country Manager

“This is a landmark moment for the development of the Marampa Project, we have made rapid progress in the past twelve months and with five rigs now drilling at site, we expect to accelerate the timing of our first resource update, scheduled for the March 2011 quarter, at which time the bulk of the rail and port infrastructure refurbishment associated with the project will be completed.”

“With this substantial maiden JORC resource complete, we will now be able to finalise a scoping study looking at a proposed initial development rate of 2-5Mtpa, from late 2012, with the maiden JORC resource providing for a mine life in the order of 20 years at 2Mtpa concentrate production, with significant resource growth to follow.”

“In addition, the metallurgical test work has shown that the hematite resource can be upgraded to a sinter fines or blast furnace pellet feed product, at a coarse grind size using mature, low risk magnetic separation,” Mr Sage added.

Maiden JORC Inferred Mineral Resource Estimate

The maiden Inferred Mineral Resource estimate is 197 million tonnes at 28.5% Fe above a 15% Fe lower cut­off of oxide and fresh iron ore. This estimate covers the Matukia and Gafal West prospects only (refer Figure 2) over a drilled strike length of 1.4 and 1km, respectively. It represents approximately 20% of the known mineralised strike at the Marampa Project (refer Figure 2) and as such the Company is confident it can be increased substantially.

The mineral resource estimate was prepared and classified by independent, international mining consultancy Golder Associates Pty Ltd (“Golders”) in Perth Australia using geological interpretations provided by Cape Lambert and is reported in accordance with the 2004 edition of the Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves (“JORC”). A full copy of Golders’ Mineral Resource Statement is attached to this announcement.

The mineral resource estimate is based upon a total of diamond drilling of 12,170metres (49 holes) completed at the Matukia and Gafal West prospects  up to 1 October 2010. Both prospects are located immediately along strike of previous open pit iron ore mines operated by DELCO until the mid-1970s. Gafal West remains open to the west, where it links with the Mafuri prospect and Matukia remains open to the north. Above 15% Fe Lower Cut-Off

Resource Growth

A total of eight iron ore prospects have been identified at Marampa (refer Figure 2 and ASX announcement 27 July 2010). The six prospects not included in this maiden JORC resource estimate represent 80% of the prospective mineralised strike identified to date. With the exception of three diamond drill holes at Petifu, none of this prospective mineralisation has been tested by drilling. This therefore presents considerable potential to significantly increase the resource inventory of the Marampa Project with further drilling.

Five drill rigs are now operating at Marampa, following the mobilisation of three additional rigs to accelerate the resource definition drilling program. This accelerated drilling program comprises 34,000m in 250 drill holes and is targeting the Mafuri, Rotret, Petifu and Makambo prospects (refer Figure 2), where little or no previous drilling has taken place. The Company is confident that this aggressive drilling program will result in substantial additions to the resource inventory.

The first resource update is planned for the March 2011 quarter and will include the results from current drilling.

Metallurgical Test Work

Bateman Engineering Pty Ltd (“Bateman”) is currently undertaking a scoping study for the establishment of a standalone, open pit mining operation and concentrator to produce 2~5Mtpa of hematite concentrate, expandable to 10Mtpa. The scoping study is due for completion in mid-December 2010.

As part of this study, Bateman has undertaken metallurgical test work on two representative run-of-mine composite samples from the Matukia and Gafal West prospects, with the aim of determining mass recovery to concentrate, concentrate quality and defining the proposed wet, high intensity magnetic separation (“WHIMS”) process flowsheet.

This metallurgical test work was based on single stage crushing, SAG milling to a primary grind of 80% passing 440 urn, roughing, cleaning and re-cleaning WHIMS stages, with the middlings fractions reground to 100% passing 250 urn, followed by WHIMS cleaning and re-cleaning stages.

Initial results (prior to circuit optimisation) show a hematite concentrate grading 63-65% Fe, 3.7-4.3% Si02, 0.9-1.2% Ai203, nil S and 0.02% P can be produced, with mass and iron yields of 30-33% and 80-83% respectively.

Exploration Target Size

With the maiden JORC resource now complete, and with the Company having a better understanding of the mineralisation at Marampa, Cape Lambert has increased the Exploration Target Size to 600Mt-900Mt at 28-32% Fe.

Infrastructure update

Marampa is connected to the deepwater port, stockpiling and ship loading facility located at Pepel via the 84km Marampa railway (“Marampa Infrastructure”).

As announced to the ASX on 16 July 2010, Cape Lambert has signed a term sheet with UK based company African Minerals Limited (AIM: AMI), which has a 99-year lease over the Marampa Infrastructure. The agreed term sheet provides for Cape Lambert to hold a 33% equity interest in the Marampa Infrastructure, with African Minerals holding 57% and the Government of Sierra Leone holding 10% interests respectively. African Minerals, through a special purpose infrastructure vehicle, is overseeing the refurbishment of, and will operate on a day-to-day basis, the Marampa Infrastructure.

In recent months work has commenced on refurbishing the Marampa Infrastructure. Key activities undertaken include

· removal of existing railway line and sleepers, and re-compacting the rail formation;
· replacing missing rail sections and ballast;
· arrival of a second hand locomotive;
· commencement of civil works at Pepel for new stockpile and reclaim areas.



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