Mt Bevan is the company’s prime focus of exploration.  Since the signing of the joint venture agreement with Hawthorn Resources Limited (“Hawthorn”) in October 2010, the Company has drilled out a major JORC compliant Inferred Resource of 617 Mt at 32.1% Fe.  Furthermore, comprehensive DTR test work has shown that the mineralisation has excellent extractive metallurgical characteristics.  Further drilling along strike of the mineralised zone is underway (mid August 2011) with the expectation to at least double the initial resource.

The Mt Bevan Iron Ore Project is a joint venture between Legacy and Hawthorn (“Hawthorn”) whereby Legacy will earn a 60% interest in the project by expending a minimum of $3.5 million to develop the project to a pre-feasibility status (Figure 2)

Figure 2: Mt Bevan Iron Ore Project

Legacy farmed into the project on the basis that there were extensive areas of magnetite rich Banded Iron Formation (“BIF”), that offered good potential for defining substantial magnetite and hematite resources close to existing infrastructure.  Hawthorn had intersected significant DSO hematite in the southern Mt Mason area, and had intersected thick and shallow dipping magnetite bearing BIF in limited shallow drilling.

Drilling by Legacy on the first of several magnetite targets commenced in February 2011, after completion of botanical surveys and obtaining statutory approvals.

The first phase drilling program was located in the southern part of the Mt Bevan project area, to the immediate north of the significant magnetite and hematite resources held by Jupiter Mines Limited (“Jupiter”) (Figure 2).  The Jupiter Mt Ida magnetite resource consists of an inferred mineral resource of 530Mt grading 31.9% Fe (15% Fe grade cut-off) and the hematite resource consists of 5.75Mt @ 59.9% Fe (inferred) at Mt Mason close to the Mt Bevan southern boundary.  This mineralisation is known to extend into the Legacy/Hawthorn joint venture ground at Mt Bevan.  Jupiter has recently announced that scoping studies, carried out by Promet Engineering Pty Ltd, have been completed on both the Mt Ida magnetite resource and Mt Mason DSO haematite resource, delivering financially robust results in both cases.  Jupiter is now conducting Feasibility Study RC drilling at Mt Mason and Mt Ida.

A total of 20 vertical and angle RC drill holes were completed in the first phase of drilling.  Drilling on the five drill fences covered an approximately 4.6km strike of the Western BIF horizon (Figure 3) to a maximum depth of 200m – 250m.  This BIF horizon extends for at least 11km within the southern part of the project area, and is the northern, more extensive part of the same horizon that hosts the Mt Ida magnetite resource of Jupiter.  In addition, this Western BIF horizon is present over several kilometres of strike length in the northern part of the project area at Mt Alexander.  The project area also contains the Eastern BIF unit that occupies some 20km strike within the project area.  No drill testing for magnetite has been undertaken on this unit to date.

Figure 3: Aeromagnetic image showing magnetite bearing BIF units (red) and first phase drill holes

All drill fences intersected a thick (circa 80m – 140m true thickness) magnetite bearing BIF unit that dips shallowly to the east (Figures 4 – 6).

Figure 4: RC drilling at Mt Bevan with outcropping BIF forming ridge to west

Figure 5: Excellent recoveries during RC drilling of magnetite BIF unit

Figure 6: Typical magnetite rich BIF unit intersected in drilling- chips adhering to pen magnet

Assay results for the drilling program produced highly encouraging results.  The most significant intersections are shown in Table 1 below.

 Table 1: Significant Intersections - RC Drilling

 Note: (EOH) – End of Hole

 Table 2: Resource Estimation – SRK Consulting

Legacy has previously announced an exploration target for magnetite mineralisation in the order of  1 –1.5 billion tonnes grading between 30% and 40% Fe* within the Mt Bevan project area (see foot note on the Clause 18 inclusion). Based on the results of the first phase drilling program, we have reconsidered the exploration target for magnetite mineralisation.  It is now considered that an exploration target* of 1.5 – 2.0 billion tonnes grading between 30% - 40% Fe exists purely within the southern part of the Western BIF target zone. This does not take into account the Mt Alexander target to the north or the unexplored Eastern BIF unit that extends for some 20km within the project area.  There also exists significant potential for the definition of shallow DID and DSO hematite iron ore resources that could allow for early stage mining.

The modelled orebody is shown in Figures 7 and 8. Figures 9 and 10 show the main magnetite body without the thinner hangingwall and footwall magnetite horizons.

Figure 7: Mt Bevan First Phase drilling – model of magnetite mineralised units with drill holes. View is to Northeast.  Main unit (green) averages circa 100m+ true thickness.  Thinner hangingwall and footwall mineralised units shown (purple and yellow)

Figure 8: Mt Bevan First Phase Drilling – modelled mineralised units.  View to west (up dip direction) showing all units

Figure 9: Modelled main magnetite mineralised unit – view to northeast

 Figure 10: Modelled main magnetite mineralised unit – view to west

Figures 3 and 11 show the locations of the drill holes.  Figures 12 to 16 show the drilling fence cross sections from south to north.  The modelling and drilling cross sections illustrate the very strong continuity of the magnetite bearing units along strike and also down dip.  The shallow dip and substantial thickness of the mineralisation will allow low waste ore stripping ratios, meaning that final open cut depths could potentially far exceed the approximately 250m vertical depth tested by drilling to date.

 Figure 11:  Phase 1 RC Drilling - Drill Hole Locations
Drilling to date has tested about 40% of the strike length of the Western BIF

Figure 12: Drill Section Line 3 - 6 779 500N

Figure 13: Drill Section Line 4 - 6 780 300N

Figure 14: Drill Section Line 5 - 6 781 100N

Figure 15: Drill Section Line 6 - 6 781 880N

 Figure 16: Drill Section Line 7 - 6 783 000N

Davis Tube Recovery (“DTR”) metallurgical tests confirm the high grade nature of magnetite mineralisation at Mount Bevan.  The results from this comprehensive DTR test work are excellent and continue to demonstrate that the Mt Bevan resource will produce a consistent, high quality concentrate product with low impurities.

A total of 206, 6m composite samples were taken from the central thick magnetite bearing BIF drilled during this first RC drilling program and tested by ALS Perth for magnetite recovery using the Davis Tube Recovery (“DTR”) technique.  This technique includes the recovery onto magnets of magnetite from a sample ground to a specific grind size as determined by grind curve testing and analysis.  The DTR method provides a laboratory approximation for commercial extraction of magnetite by magnetic separators.

The DTR program was conducted by ALS, Perth with supervision by Calibre Global – a major Australian based international provider of project management, engineering and consultancy services to the resources and infrastructure industries.  Preliminary metallurgical test work by Ammtec Laboratory, Perth including grind curve optimisation indicated the use of a 75 micron screen in the DTR procedure (yielding an approximate P80 of 50 micron).  This is a relatively coarse screen size for WA magnetite mineralisation.

The results from this comprehensive DTR test work are excellent, with an average weight recovery of 44.63%, and an average concentrate grade of 69.8% Fe, Silica contents average a very low 3.28%, with very low sulphur and phosphorus. Of note, within the thick magnetite BIF, there appears to be higher Fe, lower silica in the upper (hangingwall) zone, offering potential during mining to produce differing mill feeds.

These results place the Mt Bevan magnetite resource at the highest quality level of West Australian magnetite projects, particularly in the low silica component of the concentrate.  Most peer projects show DTR concentrate silica in the 4.5% to 6% range and utilize a more costly finer grind.  Put simply, even with a lower cost coarse grind size, a premium concentrate with low silica can be produced.

The DTR results indicate that a high purity magnetite concentrate can be produced.  This gives the project potentially the flexibility to produce either normal BF (Blast furnace) grade pellets (silica < 5.5%) which may be produced at a coarser grind size, or premium DR (Direct reduction) grade pellets (silica < 3%) at a finer grind size. 

A second phase of RC drilling will commence in mid August 2011, together with diamond drilling for further metallurgical test work.  The 6,000m RC drilling program will cover the remainder of the 11km strike of the southern part of the Western BIF including near the southern boundary of the project area near Mt Mason where DSO hematite has been previously intersected in early drilling.  This drilling should enable the calculation of a JORC compliant resource for the whole strike length of the 11km target.

MT ALEXANDER

Mt Alexander is the northern separate part of the highly prospective Western BIF unit.  Mt Alexander lies in the northern part of the project area (Figures 3 and 17).  The feature is essentially an approximately 2.5km long strike ridge rising above the western flat granite plain.

Figure 17: Aerial view of Mt Alexander

Legacy has recently completed field reconnaissance in the Mt Alexander area including rock chip sampling.  The field work has highlighted that Mt Alexander offers excellent potential for a substantial magnetite resource, and also has potential for economic hematite mineralisation.

Mt Alexander comprises a strike ridge composed of BIF, typically shallow dipping to the west (10 – 40 degrees), with some evidence of folding with locally sub horizontal and sub vertical dips.  The total true thickness of the BIF is being reviewed at this stage but is thought to be circa 100m (Figures 18 and 19). The BIF itself is very similar to that seen along strike to the south at Mt Bevan, with most outcrops showing high percentages of magnetite (now oxidized to martite/hematite at surface).  There are some substantial areas of outcrop showing particularly high percentages of coarse magnetite that has been replaced by martite (hematite – formed at depth and pressure, not weathering) (Figure 20).

This is likely a result of both structural deformation and metamorphism by proximal granites. Although requiring further evaluation, these zones are of particular interest given the potential to produce a commercial hematite product.

 Figure 18: Mt Alexander – outcropping magnetite BIF

 Figure 19: BIF unit – high percentage magnetite – now martite/hematite

Figure 20: Outcrop of coarse grained magnetite BIF – magnetite converted to martite (hematite)

The strike ridge extends for some 2.5km, but is broken at the southern end by at least two cross faults with wide zones of disruption and weathering of the BIF (Figure 21).  These faults are of a similar style and orientation to that seen at Mt Mason at the southern end of the project area.  Jupiter has defined a DSO hematite resource of 5.75Mt @ 59.9% Fe (inferred) at Mt Mason (with the resource known to extend into the Legacy/Hawthorn joint venture ground).  Jupiter has recently announced that a scoping study, carried out by Promet Engineering Pty Ltd produced a financially robust result, and feasibility drilling has just been completed.

Figure 21: Potential DSO hematite target – fault zone through BIF ridge

Field observations and the general similarity to the southern part of the Western BIF (including the first phase drill defined resource), point to an Exploration Target* of some 250Mt - 350Mt of magnetite mineralisation grading between 30% – 40% Fe, taken to a 300m depth.  In addition, as outlined above, there are considerable opportunities at Mt Alexander to outline DSO hematite resources which would enable the Joint Venture partners to generate an early cash flow from the project. 

This Exploration Target* is in addition to that of 1.5Bt – 2.0Bt grading between 30% – 40% Fe estimated for the southern part of the Western BIF target zone, and on top of the recently defined Inferred resource.

Rock chip samples have been dispatched to SGS Laboratory Perth for analysis.  Legacy plans to conduct detailed mapping and sampling over Mt Bevan, and fast track RC drilling of the magnetite and hematite targets.

Web page updated on 26 August 2011