It is reported that WPG Resources has signed an agreement with Brisbane based Maosen Australia for the iron ore rights covering EL 3945 at Giffen Well, marking WPG’s re entry into the iron ore business in South Australia.

The company withdrew from the iron ore sector when it sold its iron ore assets to OneSteel in October 2011 for around AUD 320 million.

Executive chairman Mr Bob Duffin told Proactive Investors that WPG has been trying to get exposure to Giffen Well since 2008. he said that “It is a first class prospect, so we are very pleased to have pulled off this deal.”

He added that “Our port assets at Port Pirie, which were not sold to OneSteel, can be easily utilised for the export of iron ore products from Giffen Well. We do not need someone else to build a port.”

Giffen Well is just 25 kilometres from the Carnes siding on the Central Australian railway line. There is direct rail access to WPG’s port facilities at Port Pirie, a distance by rail of 550 kilometres.

The exploration licence was originally part of the South Australian Steel and Energy Project but had been relinquished by the time WPG acquired the Peculiar Knob and Hawks Nest tenements from SASE in 2006.

Giffen Well lies within the Green Zone of the Woomera Prohibited Area, not in the more sensitive Red or Amber Zones.

Ground geophysical and drilling programs carried out as part of the SASE project outlined a significant deposit of magnetite banded iron formation at Giffen Well.

The licence area lies adjacent to the large north-east trending Bulgunnia Shear Zone along with a number of other significant mineral deposits and prospects including OZ Minerals’ Prominent Hill copper gold project and Hawks Nest.

Previous drilling at Giffen Well focused on the magnetite BIF. However, the BIF is in places in contact with granite of the Hiltaba Suite, a similar geological setting to Peculiar Knob where high grade massive hematite is located adjacent to Hiltaba aplite and granite in the footwall.

A defining factor of the project is that these contact zones have the potential for the discovery of direct shipping ore haematite orebodies such as that at Peculiar Knob and Buzzard at Hawks Nest.

Significantly, the grades are much higher than many of the magnetite deposits elsewhere in South Australia, and in particular those for the Braemar iron formation in the Peterborough-Broken Hill area, and the Eyre Peninsula.

(Sourced from www.proactiveinvestors.com.au)