Kilo Iron Ore (BVI)
Overview
The Hajigak iron ore deposit is situated in the mountainous Bamyan province, 130 km west of the Afghanistan capital of Kabul. It is one of several large iron deposits within Afghanistan and is the largest unmined iron deposit in Asia, both in terms of quantity and quality.
A study in the 1960′s demonstrated the mineral potential of the region and estimated the Hajigak resource to contain 1.8 billion tonnes of iron ore grading approximately 64% Fe.
The presence of coking coal nearby at Shabasha and the world-class ranking of the iron ore resource combine to make the Hajigak deposit an exceptionally favourable target for economic development.
[Source: Afghan Ministry of Mines]
Kilo Goldmines Ltd (Kilo) holds a 20% interest in Kilo Iron Ore (BVI), a company formed to capitalise on the 2011 release of four iron blocks associated with the Hajigak iron ore deposit in Afghanistan. In November of 2011, a consortium of Indian Companies (AFISCO), was nominated as the preferred bidder for three of the four blocks (Blocks B, C and D), whilst Kilo Iron Ore (BVI) was nominated as the preferred bidder for the fourth block (Block A - potentially a 485 Mt iron ore resource) (BBC News, 29 November 2011).
Kilo Iron Ore is at an advanced stage in its contract negotiations with the Ministry of Mines, whereafter following Cabinet approval, the exploration phase may commence. The company has commissioned Central Asian Mining Services (CAMS) to identify the logistics infrastructure necessary to support an exploration programme and the grid spacing required for a ground magnetic survey, which is part of the early phase works programme.
If successful, the project will be held in a new legal entity, namely Kilo Iron Afghanistan Ltd, with Kilo maintaining its initial 20% interest in the Parent, subject to dilution, but with no funding obligation. The independent financing and management structure of this deal was presented in the bid documents submitted to the Afghanistan Ministry of Mines.
Regional Geology
The oldest part of the succession crops out northwest of the Hajigak deposit. It consists of grey silicified limestones and dolomites, interbedded with dark grey crystalline schists and light coloured quartzites that display evidence of amphibolite grade metamorphism. They are mapped as the Jawkol Formation and interpreted as Middle Proterozoic age.
The Hajigak iron deposit is hosted by the upper Proterooic Awband formation that, together with the underlying Kab formation, constitutes the Qala Series, a sequence of metavolcanic and metasedimentary rocks up to 4500 m thick.
Metallogentic Model
Various models have been suggested for the formation of the Hajigak deposit including: metosomatic skarn, banded iron formation and submarine-exhalative. It is believed that as the Upper Proterozoic basin evolved there was an input to the sediments. Synchronous with this volcanism iron bearing hydrothermal fluids were introduced which lead to the precipitation of iron oxides and sulphides in the form of large sheets and lenses in oxidising shallow water marine conditions. These fluids would have been circulating sea water or magmatic, or a combination of both, Diagenesis and metamorphism converted the iron oxides to magnetite that is found in the primary ore. Later supergene processes oxidised the ore to hematite and goethite.
Resource
From preliminary work done in the 1960’s by Afghan and Soviet geologists, it is estimated that the Hajigak Iron ore deposit, could contain as much as 1.8 billion tonnes of iron ore, grading in excess of 60% Fe, see Table below (Afghan Ministry of Mines)
| Iron Ore resources at Hajigak – Afghan-Soviet Exploration (1960) | |||||
| Soviet classification | Equivalent classification | Ore type | Mt | Fe (%) |
S (%) |
| A | Measured or Proved | Oxidised ore | 9.1 | 62.52 | 0.14 |
| B | Oxidised ore | 19.2 | 62.69 | 0.09 | |
| C1 | Indicated or Probable | Oxidised ore | 65.1 | 62.15 | 0.13 |
| C1 | Primary ore | 16.2 | 61.30 | 4.56 | |
| C1 | Fragmented Ore | 1.2 | 60.62 | 0.08 | |
| C2 | Inferred or Possible | All ore types | 314.3 | ||
| C2 | Fragmented ores | 2.9 | |||
| P2 | Hypothetical resources | All types of ore | 1333.3 | ||
| P2 | Fragmented ores | 8.6 | |||
| Total | 1769.9 | ||||
Project Enablers
Key business or project enablers for the Hajigak Iron Ore Project are, its close proximity to:
- Key road networks and Kabul (130 km);
- the proposed Aynak rail line (25 km rail spur); and
- proposed power generation and transmission infrastructure.
Today, with infrastructure costs being a significant barrier to entry for many bulk commodity projects, this significantly improves the competitive position of this project relative to its peers.
Forward Work Plan
of August 2012, Kilo Iron Ore ‘s short term strategy is to finalise contract negotiations, conduct initial exploration activities and secure the requisite permits to commence a drilling programme of a sufficient size, to develop a JORC or NI 43-101 resource estimate.
Related Documents & Presentations
The following “Technical Reports” and “Presentations” are related to Kilo Iron Ore (BVI) and the “Hajigak Project”
| Hajigak Project and Afghanistan Overview |
| Hajigak Project and Afghanistan Overview |
Related Press Releases
| No news releases have been released at this time, please watch this space. |
In the Media
- 2012/10/12, Global Witness, Afghan Government unveils first tranche of mining and oil contract
- 2011/12/13, Global Research, Canadian Mining Companies Make the Big Move into Afghanistan
- 2011/11/28, Afghanistan Mines, Winning Bidders for the Hajigak Iron Ore Project Tender Announced