Inside the Region of Atacama the city of Vallenar has become a small mining town where several prestigious mining companies have their offices, for example to name a few; Mining Company of the Pacific (CMP) has a office in the city of Vallenar. Barrick, an International Canadian mining company has an office for its project of copper and gold called Pascua Lama in the city.

The city of Vallenar has, supermarkets, hotels, banks, mechanical workshops, pharmacies, hospitals and a different variety of stores to cover any type of needs.

The picture above is a ship at the Punta Caleta handymax port.

As a temporary port solution before the construction of the VIC port, Vallenar Iron Company has been offered stockpiling land from Puerto Caldera S.A. at their port, and the use of its port facilities at Punta Caleta (which, due to permit process, will be accessible by September 2011). This is seen as a temporary solution for the company, but does give it immediate access to shipping abroad from Chile.

In the picture above you can see Punta Alcalde. This will be the site of Vallenar Iron Company’s future port facility.

The tenements acquired and owned by Vallenar Iron Company cover 3549 hectares with geophysics surveys showing 5 “hotspots”, that is, areas of significant magnetite concentration. A successful “lump operation” existed on the site in the 1960’s where iron ore was exported until it was closed in 1970. In 2007 and 2008 Vallenar Iron Company commenced operations  and successfully shipped 500,000 tones of high quality iron ore to Chinese steel mills. Since that time a limited drilling program has discovered in excess of 200 mill tones JORC compliant resource awaiting mining and processing (An SRK Chile JORC calculation shows in excess of 200 million tonnes at a cut off grade of 18% Fe). In January 2011, Geos Consulting concluded a major diamond drilling program and produced a JORC Compliant Proven and Probable Report of 80.8 million tonnes of iron ore in the Japonesita-Primavera-Mirador tenement areas.

The tenements are part of one of the world’s largest Kiruna type iron deposits. The deposit is located in Chile in a belt extending 500 kilometers long and 60 kilometers wide. Due to the regional plate  most of the iron ore is at the surface as sedimentary deposits with “stock work” down to 60 meters and then “intrusive” material down to 250 meters. Some of the drill holes have recorded up to 30 meter intervals of 62% Fe mag at depths of 180 meters indicating a significantly deep and high quality deposit.

Geologists estimate the five hotspots identified have (potentially) between 600 million tones and 1.5 billion tones of magnetite iron ore. Vallenar Iron Company will implement a detailed and structured additional drilling program to obtain JORC compliant estimates of the tenement in total as production increases.

In the magnetic survey opposite, areas highlighted in pink and purple represent surface or at depth occurrence of magnetite greater than 55% grade – the hot spots.

The most recent production:

During 2007 and 2008 the mine produced more than 500,000 tons and sold it to two major Chinese mills who continue to have a keen interest to buy the product. Interest in the iron ore is significant because it is extremely low in impurities, a rare occurrence in iron ore deposits world-wide. The typical processed iron ore from the mine has:

• Less than 0.1% sulphur,
• 0.04-0.07% phosphorous,
• 4-6% silica,
• Very low alkalis, and importantly;
• Low aluminium (0.8-1.2%).
• The fines size was 0.15mm to 3.0mm at 63.5-64.5% Fe. 
• An additional 6 million tones of ore (which contains 3.1 million tones of sellable product) has been mined and stockpiled ready for processing.