West African-focused Bellzone Mining has reported that its Forcariah joint venture project in the Republic of Guinea, West Africa, remains on schedule to commence production of iron ore in the first quarter of 2012.
Nevertheless, investors weren't too pleased, with shares falling 9.84% to 27.5p by 11:29.
The firm has identified a 146m tonne resource with "extensive exploration" potential, which will be used for both short and long term production.
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The necessary studies and assesments have been carried out and the firm is now awaiting approval from the government, which has completed a port feasibility study review.
The construction of a road for haulage is on track to be completed in Feburary, while contracts are in place for production to begin in the first quarter of next year. The equipment for the first phase has been shipped and the mining and haul fleets are on route.
Investec was disapointed with the statement, saying, "While it could be interpreted as a positive, i.e., that a resource has finally been announced, we feel that is a weak result, after months of drilling, and a poor indication of how the resource is developing." The broker put its buy rating under review.
Chief executive officer Nik Zuks said: "It is very satisfying to update on such a level of progress at Forcariah, as we near the end of 2011 and move for production in the first quarter of the new year. I would like to thank our shareholders for their continued support and look forward to updating on our mining activities throughout 2012."
The site has an initial internal resource of 2.0mt of iron oxide grading at +55% iron, 5.9mt of iron oxide grading at 45.7% iron, although initial gravity testwork indicates grades of 58% iron are achievable, and 13.2mt of lower grading oxide, grading at 34% iron at the surface.
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