Sanjeev Gupta is running the ruler over potentially very large iron ore deposits in South Australia’s north east

Whyalla saviour Sanjeev Gupta is running the ruler over two iron ore deposits in the state’s northeast, which could provide more feedstock for the Whyalla steelworks.

• Sanjeev’s plans to transform SA’s power market
• GFG boosts its renewable power ambitions
• Sanjeev Gupta floats copper plan for Whyalla

WHYALLA saviour Sanjeev Gupta is running the ruler over two iron ore deposits in the state’s northeast, which could provide more feedstock for the Whyalla steelworks.

Havilah Resources, an Adelaide company listed on the Australian Securities Exchange, said Mr Gupta’s company SIMEC Mining, an affiliate of the owner of the steelworks, GFG Alliance, will “carry out due diligence on the Maldorky and Grants iron ore projects in northeastern South Australia,’’ Havilah said in a statement.

“The joint objective is to determine the future development and commercialisation potential of the projects.

“As part of the due diligence, Havilah has provided SIMEC Mining with several tonnes of RC drill samples from the Maldorky and Grants deposits and drill core from the Maldorky deposit for metallurgical testing purposes.’’

British Industrialist Sanjeev Gupta at the Adelaide Convention Centre in Adelaide. (AAP Image/Kelly Barnes)

Havilah director Chris Giles said the two deposits were close to rail lines and the Grants deposit in particular had the potential to be “very large”.

Currently the Grants project, which is just 8km south of the Barrier Highway and the Transcontinental Railway, and a one hour drive west of Broken Hill, has an iron ore resource of 304 million tonnes and the Maldorky deposit has a resource of 147 million tonnes.

“The beauty of grants is what we’ve drilled is just the tip, the end of it and it’s like a great huge doughnut on the aeromagentics.

“It really has never been recognised so it’s potentially huge.

“That’s what’s attractive to them. It’s a Pilbara-size iron ore project potentially.’’

Mr Giles said SIMEC would likely be in a position to make an assessment of the project by the end of the year.

“They are doing a serious amount of work on it,’’ he said.

Mr Giles said the main issue with iron ore project was transport infrastructure, and any tie up with GFG’s Whyalla operations would largely solve that piece of the puzzle.

Mr Gupta, who won the bidding war for the former Arrium operations mid-last year, has since acquired a majority stake in Adelaide renewable energy company Zen Energy, now SIMEC Zen energy, and announced plans for eventually up to 10 gigawatts of installed renewable energy, with solar and pumped hydro operations at Whyalla key to this ambition.

Havilah shares were 1.5c lower at 23c in early trade.

[e-mail]