Firstenergy Corp. (FE)

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Cardero Receives Positive Metallurgical Test Results for Pampa de Pongo Iron Ore Deposit
Tuesday April 22, 1:08 pm ET


Initiates Additional Metallurgical Testing

NI 43-101 Resource of 953Mt @ 44.7% Iron and 0.12% Copper


VANCOUVER, BRITISH COLUMBIA--(MARKET WIRE)--Apr 22, 2008 -- Cardero Resource Corp. ("Cardero" or the "Company") (Toronto:CDU.TO - News)(AMEX:CDY - News)(Frankfurt:CR5.F - News) is pleased to announce it has received from Rio Tinto Exploration a copy of a positive metallurgical test report on two samples from the Pampa de Pongo iron deposit. The object of the 1996 metallurgical study ("Study"), conducted by Met-Chem Canada Inc. on behalf of RTZ Mining & Exploration, was to investigate the feasibility of producing a pellet feed chemically suitable for Direct Reduction pellet manufacture and, if suitable, to evaluate the resulting pellets on a laboratory scale. The test results from the study indicated that the iron material from Pampa de Pongo is suitable for the production of Direct Reduction grade pellets. In order to provide independent verification of these positive results, Cardero has initiated testing of a larger sample of Pampa de Pongo mineralization.
Pellet Feed Production

Following investigation of conventional beneficiation techniques (screening, magnetic separation and flotation) it was demonstrated that the Pampa de Pongo mineralized material could be concentrated up to 66-69% iron through a simple Low Intensity Magnetic Separation (LIMS) process, with the remaining gangue (waste) material consisting of 2.5-3.0% magnesium oxide (MgO) and 0.5-1.5% sulphur (Figure 1, to view, please click the following link: http://media3.marketwire.com/docs/cdu0422.pdf). Concentrates were obtained through 3 passes in a magnetic separator and recoveries are described by Met-Chem as excellent. Concentrates showed a high magnetite content that normally results in low energy consumption in the firing process. Results are as follows:



Table 1: Initial Sample and Concentrate Chemical Composition

Sample 1 (4B/9B) Sample 2 (4B/4B)
Head Grade Concentrate Head Grade Concentrate
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Fe % 56.2 69.0 53.0 66.7
SiO2 % 5.42 0.55 6.19 0.84
Al2O3 % 1.66 0.69 2.17 0.92
MgO % 8.00 2.60 9.62 2.89
S % 1.84 0.54 2.37 1.51
Fe3O4 % 64.3 82.5 61.0 80.2
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Pelletizing Tests

Pellets produced from Sample 1 were of good quality and strength, meeting normal commercial specifications without further work. The pellets exhibited extremely low clustering indexes, which is highly desirable in the natural gas based Direct Reduction processes. Sample 1 contained a slightly higher than normal percentage of MgO but this did not affect the quality of the pellet produced. Additional slagging in the EAF (Electric Arc Furnace) can reduce the MgO content, however the high MgO content of the metalized pellet can be an advantage in the steelmaking process as most EAF refractory linings are MgO based, and the slag routinely needs to be conditioned to have 10-14% MgO so as to mitigate slag line refractory erosion.

Concentrate from Sample 2 contained higher MgO and higher sulphur content than Sample 1. The pellets produced from Sample 2 were weaker due to higher sulphur content in the concentrate. In this case, Met-Chem suggested that further test work, including a finer grind and more sophisticated flotation reagents, should further improve the concentrate chemistry. Requirements for further work are typical of early-stage metallurgical test work and Cardero is confident that elevated MgO contents can be addressed through process flowsheet optimization. The pellets exhibited extremely low clustering indexes, which is highly desirable in the Direct Reduction process. Samples 1 and 2 were mixed with 0.8% bentonite, pelletized and fired. The fired pellet chemical compositions were as follows:



Table 2: Fired Pellet Chemical Composition

Sample 1 Sample 2
(4B/9B) (4B/4B)
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Fe % 66.9 66.6
SiO2 % 0.81 1.22
Al2O3 % 0.74 0.95
MgO % 2.61 2.91
S % less than 0.01 0.01
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It was concluded that the strength and reduction properties (reducibility, linder and clustering) of the pellets are well within the acceptable range for typical commercial products. Additional processing steps would be required to reduce the sulphur content of sample 4B/4B.

Future Work

The metallurgical study reported here provides an important indication that Pampa de Pongo iron ore will be suitable for production of Direct Reduction grade pellets. The test work was conducted on small quantity of sample and Cardero has now initiated a follow-up study, which will test larger samples and independently verify the positive results presented here. It is believed that the final product can be further improved, resulting in even better pellets, by additional processing steps, such as regrinding of the concentrate prior to pelletizing.

Laboratory Details

The metallurgical testing was completed by Met-Chem Canada Inc. of Montreal, Quebec, Canada in 1996 on behalf of RTZ Mining and Exploration with the objective of determining whether quality direct reduction pellets could be produced from iron ore samples. Laboratory work was completed by CRM (Centre de Recherche Minerale) of Sainte-Foy, Quebec, Canada. Two samples were analysed weighing 36 and 38 kilograms, respectively.

"We are extremely pleased with the results of this metallurgical test work, which demonstrates the viability of producing Direct Reduction grade pellets from the Pampa de Pongo iron ores" stated Henk Van Alphen, Cardero's President & CEO. "We have known for some time that we have a world class deposit at Pampa de Pongo and now we have the first indications that a high value DR pellet can be produced, which adds considerable value to the asset."