The zircon industry has long been
tied closely together with the titanium dioxide
(TiO2) feedstock industry. Although the two
industrial minerals have widely different end uses and supply
chains, ilmenite and rutile, used to make TiO2, and
zircon are often found in the same deposits. This means that
the shortage in supply of titanium feedstocks, that has sent
prices rocketing in the last 18 months, will have an impact on
the zircon industry.
Prices for zircon have indeed risen
drastically from $870/tonne in October 2010 to $2,500/tonne
today for zircon, standard grade, FOB Australia, according to
IMs prices database.
This has been mainly caused by a
shortfall in supply accompanied by a rise in demand fuelled by
the Chinese construction market.
Zircon is used primarily in ceramic
tiles as well as foundry applications, refractories, and as the
base for a wide range of zirconium chemicals. In 2011,
according the US Geological Survey, only 1.4m tonnes of zircon
were produced, originating mainly from Australia where leading
global producer Iluka Resources is based.
Australia is also the home of the
majority of new projects springing up, most of which occur in
the Eucla and Murray basins (see map).
These basins are significant
because ancient seas, of Tertiary age, deposited large
quantities of heavy minerals - rutile, zircon, leucoxene,
ilmenite, thorium, and others - through tide, wave, and wind
action into paleo strandlines before receding.
The strandlines in these basins
have remained remarkably well preserved.
The Eucla Basin
The Eucla Basin is located in south-western Australia, both on
and off shore, and has been through four marine cycles - seas
encroaching and receding.
As such, its well preserved
strandlines are a great source of heavy minerals which
companies like Iluka Resources, Diatreme Resources, and Image
Resources are exploiting.
Iluka has an existing production
base at Jacinth-Ambrosia, where it has only recently begun
mining, which it describes as the largest, highest
assemblage zircon development globally for several
decades.
Ilukas confidence in this
geological area is indicative of the high quality of
mineralisation that exists and can reflect the potential of
more junior projects in the area.
In the Western Australia section of
the basin is Diatremes Cyclone project. This has passed
the pre-feasibility stage and could start production in
2015.
It would then produce, according to
the study, 65,000 tpa zircon over 10 years.
Image Resources Eucla basin
deposit - Cyclone Extended - is located directly below
Diatremes deposit. While it is at a less defined stage
than Diatremes, the company has carried out an aircore
drilling programme and found a typical shoreline style with low
slime (4% within the mineralisation), well sorted sands and
heavy mineral grades up to 13%.

The Murray Basin
The Murray Basin is a major production source for Iluka for
both rutile and zircon. As such, it is also home to a number of
other companies exploring areas of similar mineralisation.
This includes Murray Zircon, a
joint venture between Australian Zircon and Orient Zirconic -
one of Chinas largest zircon processing companies.
Murray Zircon is working on the
Mindarie mineral sands project which was active until
production ceased in 2009.
As such, the mine is one of the
closest to production which the company hopes to achieve in the
first half of 2012.
The mine consists of eight
strandlines of which two have already been mined. The company
intends to restore the area of the two strandlines and mine the
rest.
When operational the mine should
produce 120,000 tpa of mineral concentrate. Of this 17% would
be zircon, 67% ilmenite, 3.9% rutile, and 5.1% leucoxene.
The US
The US is not a major producer of zircon but now there are two
new projects looking to take advantage of the current rising
prices, as well as Oregon Resources which began production at
its Coos Bay deposit in March 2011.
The first is Arcadia Minerals
two deposits in Wyoming - Grass Creek and Dugout Creek. Of
these two, Grass Creek has the higher grade resource and the
deposit is still open-ended on three sides.
A pre-feasibility study has already
been carried out on this deposit which has a defined resource
of 3.5m tonnes with 4.1% zircon and over 21% titanium dioxide
(ilmenite) as well as saleable quantities of magnetite and
monazite.
Dugout Creek has had less drilling
done on it but drilling so far has produced an estimated
resource of 33m tonnes with 0.35% zircon and around 6% titanium
dioxide.
This deposit too remains open-ended
on three sides so the full extent of the deposits has not been
determined.
Arcadia told IM
that a $6m drill budget was in place for both resources for
this year which would help define the resources and move the
projects towards production.
Southern Ionics is also approaching
production at its Mission mine in Georgia, in the south-east of
the US.
While not traditionally a mining
company, Southern Ionics has moved swiftly along and is
submitting permit applications in June 2012, with first mine
production scheduled for Q4 2013.
Southern Ionics specialises in
zirconium chemicals and will utilise the zircon produced at its
mine internally but will sell the titanium dioxide feedstocks
that are produced on the open market.
The company has already completed
drilling, bulk processing, and feasibility studies.
When production begins in 2014, the
company told IM, the mine is expected to
produce 8,500 s.tons (7,719 tonnes) zircon and 32,000 s.tons
(21,029 tonnes) titanium minerals. From 2015 onward, zircon
production will average 16,000 s.tons (14,514 tonnes) zircon
and 60,000 s.tons (54,431 tonnes) titanium minerals.
The mine will use a dry mining
method as opposed to conventional wet mining, which uses a
floating dredge.
The company will construct a
floating concentrator located in a central water-filled canal
running the length of the ore body. As mining progresses
further away from the concentrator mill, the mill is then
pulled through the canal to the closest point possible to the
active mining cell.
Oregon Resources principally
produces chromite from its project in Coos Bay, Oregon, but it
also produces foundry grade zircon, rather than ceramic grade,
in addition to high-iron ilmenite and garnet.
It produces roughly 8,500 tpa
zircon and has a resource of 7.9m tonnes grading at 21.5% heavy
minerals and containing roughly 31,500 tonnes zircon.
Africa
South Africa is the second largest producer of zircon and has
the second largest national reserves, according to the US
Geological Survey, of 14m tonnes.
This, combined with the benefits
brought by its existing mining industry, makes it a good
location for mining.
Australian-based Mineral
Commodities Ltd has two projects in South Africa that have had
several regulatory problems but have made progress
recently.
A definitive feasibility study has
been completed on its Tormin Mineral Sands project which
concluded that the deposit could produce 30-40,000 tpa of
concentrates.
This year, the South African
government approved the environmental management plan for the
mine and the company believes that other regulatory matters
will be concluded during the first half of 2012.
The acceptance of the environmental
management plan was one of the final obstacles and now the
company can undertake accelerated development activities, it
said.
The companys second deposit
has much less exploration performed but has a resource of 346m
tonnes grading at 5% heavy minerals which gives the deposit a
resource of 9m tonnes of ilmenite.
Possibly the most well known
African deposit is Base Resources Kwale Mineral Sands
project in Kenya.
The project has a long and
convoluted history under previous owner Tiomin that dragged on
for 15 years.
The project was fraught with
problems and Tiomin faced major bureaucratic issues with the
Kenyan government and a dispute with local farmers over land
rights.
The project was then taken over by
Base Resources in 2010 for $3m.
Since then Base Resources has
secured funding as well as an off-take agreement with titanium
dioxide pigment producer DuPont for 72% of its rutile
production for the first six-year period.
The project is expected to start up
in the third quarter of 2013, producing 330,000 tpa ilmenite,
80,000 rutile and 35,000 tpa zircon in the first six years of
operation.
Deposits in Senegal, Mozambique,
and Madagascar are also being explored.
Overall, the zircon industry is
buoying as prices rise and this has encouraged a number of
exciting new projects.
While prices remain high this will
continue but if there is ever a dramatic fall in demand, for
example a crash in the Chinese construction industry, it could
make a lot of these new projects uneconomical.
Australia will continue as
zircons heartland for a long time to come, and as these
new projects come to fruition it is likely to remain the
dominant market player. However, the US and Africa have shown
their potential as competitors and leave us without doubt that
there are interesting times to come.
Company
|
Project
location
|
Comments
|
Alkane Resources Ltd
|
New South Wales, Australia
|
·
The definitive feasibility study is underway
·
Production of zirconia and rare earths to begin in 2014
and be used to produce zirconium chemicals
·
Current measured resource of 35.7m tonnes grading at
1.96% zircon
·
Inferred resource of 37.5m tonnes grading at 1.96%
zircon that will produce an estimated 15,700 tpa
zirconia
|
Arcadia Minerals
|
Wyoming, US
|
·
Two Wyoming-based deposits Grass Creek and
Dugout Creek
·
Defined a resource of 3.5m tonnes with 4.1% zircon and
over 21% titanium dioxide (ilmenite) as well as
saleable quantities of magnetite and monazite at its
Grass Creek deposit
·
Has completed a pre-feasibility on Grass Creek and the
deposit remains open-ended on three sides
·
Current resources at Dugout Creek have been estimated
as 33m tonnes with 0.35% zircon and around 6% titanium
dioxide
·
The deposit is also open-ended but less drilling has
been done on it
|
Astron Ltd
|
Murray Basin, Australia
|
·
Recently updated the resource for its Donald Mineral
Sands project in Murray Basin
·
4.04bn tonnes grading at 4.8% heavy mineral content
roughly 37m tonnes zircon
·
Donald and Imerys Asia Pacific entered into a
nonbinding off-take agreement, for certain minimum
annual quantities
|
Australian Zircon NL
|
Murray Basin, Australia
|
·
Formed joint venture company called Murray Zircon with
Orient Zirconic Science & Technology Industry Co.
Ltd - one of Chinas largest zircon processing
companies
·
Murray Zircon will restart production (ceased in 2009)
on the Mindarie Mineral Sands project in H1 2012
|
Base Resources
|
Kwale, Kenya
|
·
Completed enhanced definitive feasibility study in May
and should be entering production in 2013
·
Plans to produce, on average, 30,000 tpa zircon,
330,000 tpa ilmenite, and 79,000 tpa rutile over the
first seven years
·
Over the final six years, production to rise to 19,000
tpa zircon, 200,000 tpa ilmenite, 55,000 tpa rutile
|
Diatreme Resources
|
Eucla Basin, Australia
|
·
Has completed pre-feasibility study and should start
production in 2015
·
Project to produce 70,000 tpa zircon for the first
three years, averaging 65,000 tpa over 10 years
|
Gunson Resources
|
Western Australia, Australia
|
·
Completed definitive feasibility study on its Coburn
project, north of Perth
·
Starting the early stages of construction in early May
2012 with main phase of construction to begin in the
last quarter 2012
·
Production is anticipated to start in early 2014 and
produce 40,000 tpa zircon
|
Iluka Resources Ltd
|
Murray, Eucla
basins, Australia
and Virginia, US
|
·
Iluka has a number of promising projects based
throughout Australia, mostly focused in the Eucla and
Murray Basins, in addition to projects in the US; these
include Cataby, Balranald, Sonoran, Typhoon, Atacama,
and Woornack, Rownack, Piroo (Australia), as well as
Hickory, and Aurelian Springs (US)
·
The closest to production is the Woornack, Rownack,
Piroo deposit which will begin production in late May
2012. It has a resource of 1.4m tonnes of heavy mineral
concentrate
·
Ilukas combined brownfield projects
Sonoron, Typhoon, and Atacama are intended to
expand on existing operations at Jacinth-Ambrosia. They
have a combined resource of 11.3m tonnes of heavy
mineral content of which 16% is zircon
|
Image Resources
|
Eucla Basin (Cyclone), Australia
|
·
A scoping study has been completed on its Cooljarloo
North deposit and a preliminary feasibility study is
not completed
·
A resource estimation has been completed on its
Cooljarloo deposit
·
A resource estimate has been completed on its Bidaminna
deposit
·
Initial drilling has been completed on its Cyclone
extended deposit in the Eucla Basin, just south of
Diatremes Cyclone deposit - further drilling is
underway
|
Lanka Mineral Sands
|
Northern Sri Lanka
|
·
Currently constructing a mineral sand plant in Kokilai,
Sri Lanka
·
Ramping up of mine production of zircon and ilmenite
since defeat of Tamil Tigers in 2009
·
The black mineral sands of Pulmoddai beach are
considered as some of the worlds richest, having
heavy mineral concentrations of 50-60%
|
Latin Resources
|
Chimbote, Northern Peru
|
·
A JORC resource of 118m tonnes grading at 5.7% heavy
minerals has been reported at its Guadalupito Iron and
Heavy Mineral Sands project
·
Deposit is partially submerged and could require both
dry mining and dredging
|
Matilda Zircon
|
Western Australia, Australia
|
·
Beginning detailed planning and engineering to enable
construction of its Keysbrook project
·
Production to begin in early 2013
·
Resource of 60.5m tonnes grading at 2.48% heavy
minerals
·
Keysbrook should produce 95,000 tpa of zircon and
leucoxene
·
Currently getting approvals for its Kilimiraka deposit
on the Tiwi Islands, Northern Territory Australia
·
Mining is planned to commence in late 2013
·
The deposit has an inferred resource of 56.2m tonnes
grading at 1.6%
·
The project will have a mining rate of 700 tph
|
Mineral Commodities
|
Western Coast, South Africa
|
·
A definitive feasibility study has been completed on
its Tormin Mineral Sands project which concluded that
the deposit could produce 30,000-40,000 tpa of
concentrates
·
The Xolobeni deposit has much less exploration
performed but has a resource of 346m tonnes grading at
5% heavy mineral
|
Mineral Deposits Limited
|
Northern Coast, Senegal
|
·
Its Grande Côte deposit has a measured and
indicated resource of 1.03bn tonnes at 1.7% heavy
minerals
·
The mine will produce approximately 85,000 tpa zircon
starting in late 2013
·
The company intends to start production in late
2013
|
Oregon Resources Corp.
|
Oregon, US
|
·
Started production of foundry grade zircon in March
2011
·
The company produces, on average, 8,500 tpa zircon and
has a resource of 7.9m tonnes grading at 21.5% heavy
minerals and containing roughly 31,500 tonnes
zircon
|
Pathfinder Minerals
|
Nampula, Mozambique
|
·
The company has completed scoping studies on its
Moebase and Naburi mineral sands deposits
·
Currently completed a definitive feasibility study on
both projects
·
The projects have a combined resource of 2.02bn tonnes
grading at 3.55% heavy mineral content
·
Anticipated production of 65,000 tpa zircon over first
10 years
|
Sheffield Resources
|
Western Australia, Australia
|
·
The companys flagship project is the Dampier
project located in the north of Western Australia
·
This project will undergo drilling in this quarter with
a resource estimate to be produced in Q3 2012
·
The project has an exploration target of 450-850m
tonnes grading at 5-10% heavy mineral content
·
The Eneabba project near Perth, Australia, will be
undergoing a pre-feasibility study from Q2 2012
·
The project has a resource of 161m tonnes grading at
2.5% heavy mineral content
·
The McCalls project, located north of Perth, is
currently undergoing additional drilling and will start
prefeasibility in Q3 2012
·
The project has a total inferred mineral resource of
4.4bn tonnes, containing 3.5m tonnes zircon, 1m tonnes
rutile, and 43m tonnes ilmenite
|
Southern Ionics Inc
|
Georgia, US
|
·
Submitting permit applications in June 2012 with
drilling, bulk processing, and feasibility studies
completed
·
First mine production scheduled for Q4 2013 and will
operate for 8 to 10 years
·
The zircon will be used for Southern Ionics zirconium
chemicals and the titanium feedstocks will be sold on
the market
|
Trimex
|
Indonesia
|
·
New processing plant to start up in December 2013
although the exact location has not been announced
·
The plant will use resources from, and be located close
to, mineral sand deposits in Indonesia
·
At the final stage of clearance for a mining lease
Bhavanapadu deposit near to Srikakulam, India
·
The project is scheduled to start in July 2012 and
produce 7,000 tpa zircon
·
A study is underway for a heavy mineral separation
plant, probably located nearby
|
Varun Industries Ltd
|
Southern tip of Madagascar
|
·
The company has recently signed an agreement for the
sale of rare earths with a Public Sector Undertaking
under the Department of Atomic Energy, Government of
India
·
The company plans to set up a processing plant in the
coming 8-10 months
·
It hopes to produce approximately 500,000 tpa heavy
minerals concentrate
·
Plans to produce principally rare earths but may
produce zircon as well
|
VV Mineral
|
India
|
·
Informed IM that the company is currently exploring
two-three projects inside and outside India
·
One project outside of India is expected to come online
in 2013 and will produce 40,000 tonnes of heavy mineral
(zircon, rutile, ilmenite) in the first year and then
ramp up over time
|