AIM-listed Baobab Resources has unveiled details of pyro-metallurgical test work at its Tete project confirming the ability to produce a low-impurity pig iron product using the company's iron ore and local Mozambique thermal coal.

The company, which has a large landholding in the central north of Mozambique, reported that the reduction and smelting test work was conducted using coarse concentrates derived from the Tenge resource block at the Commonwealth Scientific and Industrial Research Organisation laboratories in Australia.

Reduction test work using a rotary kiln simulator returned "very promising results" with in excess of 70% metallisation being achieved after a short residence time using locally sourced thermal coal as a reductive agent, the company reported.

Ben James, Managing director of Baobab Resources, said: 'The results of the pyro-metallurgical test work mark a major milestone for the project. Two critical questions have been answered: will local thermal coals work in the reduction process and will the titanium separate from the iron when smelted? In both cases the answer is a resounding yes.

"We now possess very clear physical and empirical evidence to support the company's conviction that we can exploit the project's unique access to low cost thermal coal at the licence boundary together with Baobab's iron ore to produce a high quality / low impurity pig iron at the bottom of the cost curve."

Baobab Resources' share price was up 2.17% to 29.38p at 11:13 on Monday.

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