West African Minerals (LON:WAFM) said it had uncovered a ‘high quality’ iron ore deposit as it unveiled the maiden resource statement for the Sanaga project in coastal Cameroon.

Just 60km from the port at Douala and within 10km of the rail line, Sanaga is estimated to contain 82.9mln tonnes of ore at 32.1% iron and a 25% cut-off.

This includes a 15.8mln-tonne, near-surface oxidised cap at 37.3% iron. Crucially, previous metallurgical test work has revealed Sanaga is able to produce a premium grade concentrate of 69% iron at a ‘favourable mass recovery’.

The mineralisation extends along a three-kilometre strike and down to just 150 metres, although the deposit remains open at depth.

“The geometry of the mineralisation, which outcrops at surface, lends itself to low cost, low stripping ratio open pit mining,” said WAFM president Brad Mills.

“The project's close proximity to existing rail, power and port infrastructure suggests minimal capital expenditures will be required to develop export infrastructure.

“While we recognise the depressed state of the current iron ore market, the Sanaga resource represents an opportunity to develop a low capital intensity and low operating cost project.

“This positions WAFM to be a first mover in Cameroon as and when the current iron ore pricing environment improves.”

In the same statement, the company said it was sitting on cash of around US$7mln, which will allow it to pursue the further development of the Sanaga ‘when warranted by the market’.

However, WAFM said it is also looking at acquisition opportunities ‘that could add significant near term value’.

The shares, up 17% in early deals, settled at 2.75p each for a 3% gain.