While the price of iron ore slipped below the all important $US100 mark on Tuesday, shares in Twiggy Forrest’s Fortescue Metals Group rallied after the company announced it was adding another 1.16 billion tonnes at its Solomon operation in Western Australia.
Closing up 3.89% at $4.54 a share, it shows that after 12 months of paying down high debt levels and adding additional tonnes to its operations, the market is starting to show some support, even in a lower commodity price environment.
The boost to its inferred Solomon mineral resource base takes the total to 2.66 billion tonnes. Fortescue said it will be drilling out several targets during the 2015 financial year to convert the resource to indicated status.
“If converted to a Mineral Resource, Fortescue will determine whether the ore is suitable to transport by conveyor network or haulage by road to the existing OPFs,” the company said.
That means the company’s total Solomon Hub minerals resource could blow out further to 4.5 billion tonnes when Fortescue’s Firetail and Kings Valley projects are included.
Fortescue is also drilling out targets around the Chichester Range in June and July this year and revealed the inferred mineral resource at its Eliwana-Flying Fish project, previously the western hub, is now estimated to be 740 million tonnes.
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