Tete Project Highlights

  • Magnetite-ilmenite deposits in two discrete areas: The Massamba Group Area and the Singore Area.


  • 3,000m diamond drilling programme completed at Chitongue Grande prospect.


  • 47.7Mt maiden Inferred Mineral Resource estimated in accordance with the JORC code.


  • Independent interpretation indicates an exploration target potential of 400 to 700Mt to a depth of 250m in the Massamba Group area.


  • Postive scoping study results indicate significant project upside.


  • Close to critical infrastructure and complementary resources including hydro-electric power, metallurgical coal and rail/port.


  • Strategic partnership with International Finance Corporation (IFC): 15% direct project participation.

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Tete Project Overview
The Tete project is located immediately north of the Provincial capital of Tete and comprises three contiguous Exploration Licences that straddle the central portion of the Tete Mafic Complex, covering an area of approximately 632km2. The Licences contain 5 known vanadiferous titano-magnetite deposits: Singore, located approximately 30km due north of Tete; and the cluster of prospects known collectively as the Massamba Group, located 55km north-northeast of Tete.

Baobab formed a strategic partnership with IFC (International Finance Corporation) in January 2009 where IFC earned a 15% direct interest in the Tete project.

Tete is fast becoming a major investment centre with mining majors Vale and Riversdale/Tata Steel in the process of opening up the Moatize and Benga coal fields. The railway connecting Tete to the port of Beira is being refurbished, as is the port. Low tariff hydro-electric power is readily available from the 2,075megawatt Cahora Bassa dam, with an additional 1,500megawatt scheme at Mphanda N'kuwa, also on the Zamebezi, in advanced planning stages. Coal fired power plants have proposed for Moatize and Benga.


Tete Project Exploration

Baobab commenced exploration activities at the Tete Project in 2008 completing an aeromagnetic survey, field mapping and sampling and metallurgical bulk sample test work. For a detailed review of this work, please refer to AIM announcements dated 20th May 2008, 18th June 2008, 27th October 2008 and 5th February 2009 (which are available for download from the Company's website www.baobabresources.com).

The Company has focused its 2009 activities on the Massamba Group Area where exploration has identified magnetite -ilmenite mineralisation over 8km of strike.

Diamond Drilling

Diamond Drilling at the Chitongue Grande prospect, one of four deposits that make up the Massamba Group, commenced in April 2009. The programme is composed of 15 holes (3092m) drilled at an inclination of 60º along 4 northwest-southwest traverses spaced 100m and 200m apart covering a strike length of approximately 500m.

Drilling intersected stacked packages of magnetite-ilmenite mineralisation intercalated with gabbroic and anorthositic country rock. The packages dip at shallow angles of 10 to 30 southeast from surface and composed of individual horizons, varing in width from 0.5m to 30m. Vertical, fine grained mafic dykes intrude the area. Mineralisation remains open down dip on all sections. To view location plan and interpreted cross sections, please refer to the Aim announcemnet dated 26 June 2009 on the Company website.

For detailed analytical result, please refer to the AIM announcements dated 6 July, 14 July, 10 August and 25 August 2009.


Resource Estimate

Coffey estimated a 47.7Mt Inferred Resouce based on the drilling programme at Chitongue Grande with a head grade of 25.3% Fe,0.18%V2O5 and 9.69% TiO2 (announced to AIM on 24 September 2009). Their estimate was compiled in accordance with the JORC Code guidelines. The prospect remains open along strike and down dip.

The mineralised horizons contain internal partings of non-mineralised waste material which have not been sampled. Some of this material may not be preferentially mineable and would therefore act as a dilutant. Without sampling the intermediate waste partings, it has not been possible to predict what the expected weight recovery and recovered grades might be. However, based on the completed estimation, the expected recovery (DTR) for the magnetite portion of the mineraised material will be in the order of 19.7% with the average concentrate grade in the order of 63.7%Fe, .068% V2O5, 4.86% TiO2, 1.3%SiO2, 2.75% Al2O3, 0.001% P and 0.37% S.

Exploration Target Study

Coffey was commissioned to assess the exploration target potential of the Massamba Group area for iron / vanadium (in the form of magnetite) and titanium (in the form of ilmenite) mineralisation (announced to the AIM on 29 September 2009). While the Chitongue Grande drill hole data and resouce modeling were used to assist in the characterization of mineralisation, the resource area was not included in the area of assessment.

Due to the very high magnetic susceptibility of the targeted mineralisation, Coffey elected to utilize the Company's high resolution aeromagnetic coverage as the primary means of assessing the potential, complemented by geological mapping, rock chip sampling and drill hole data.

Coffey has used three dimensional 0.25Sl and 0.3Sl magnetic susceptibility isosurfaces to digitise volumes to 250m below surface and model a tonnage range of 400Mt to 700Mt using a bulk density of 3.2t/m3 and a gangue discount of 40%. An exclusion zone, with a radius of 1.2km centered on the Chitongue Grande resource, was not included in the modeling. Coffey elected not to model nor report grades in this study.

Conceptual Scoping Study

Coffey was commissioned to complete a desk top scoping study based on the drill hole analytical results, 2008 bulk sample test work and limited petrographic analysis of drill core.

The preliminary petrography report and Davis Tube Recovery (DTR) analysis of Chitongue Grande drill core demonstrated amenability to the production of two separate concentrate products through a primary Low Intensity Magnetic Separation (LIMS) circuit, followed by the re-processing of the non-magnetic tails through a gravity separation and High Intensity Magnetic Separation (HIMS) circuit. The concentrate characteristics are expected to be:

LIMS: a high grade magnetite ferro-vanadium concentrate grading 67%- 70% Fe, 0.6% - 1.0% V2O5 and 1.3% to 3.5%.

TiO2 at a mass recovery of 20-25%. All other deleterious elements would be within acceptable limits.

HIMS: an ilmenite concentratae grading 50% TiO2 and 10%-15%Fe at a mass recovery of 8%-14%.

Although the Chitongue Grande results indicates a 20% to 25% mass recovery, the bulk sampling test work from Chitongue Pequeno and Caangua prospects and rock chip DTR analysis from other areas within the project (completed during 2008) reported considerably higher mass recoveries in excess of 50% for the ferro-vanadium concentrate. It is considered that significant improvement of the overall mass recovery may be achieved if the Chitongue Grande feed is blended with other, high recovery feed stocks in the proposed processing plant.

The study concluded that there were a number of processing options that could be applied to the Tete deposit and that there was considerable upside that may yet result from furthr optimisation of various processing route options via laboratory test work. The ilmenite concentrate in particular may then be further processed through roasting, chemical or pyrometallurgiacal processing methods to produce a higher grade concentrate.

Coffey also completed a financial modelling exercise, drawing together the results of resource estimate and exploration target assessment and mineral process analysis. Additional parameters were based on a suite of industry standard assumptions.

A base case scenario of a 300Mt resource and 10Mtpa mill throughput producing magnetite and ilmenite concentrates was modeled. The analysis indicates that the Tete project is likely to be economically viable based on a magnetite mass recover of 30% and a 15% credit for the V2O5 component of the ferro-vanadium concentrate.

The study has identified key sensitivities that influence the project economics. These include; strip ration, mass recovery, concentrate grades, credit negotiation, resource base and mill through put.