Iron Peak is the highest-quality deposit uncovered to date at Razorback, in South Australia's east, with project proponent Magnetite Mines planning further drilling and studies.

Magnetite Mines chief executive officer Tim Dobson said the team had done an extraordinary job in growing the Razorback iron ore project ore reserves from zero to 2Bt in fewer than two years.

"Importantly, the conversion of the recently upgraded Iron Peak mineral resource to ore reserves not only adds years to the potential mine life, but it also improves the economics of the project due to the higher grade nature of the Iron Peak mineralisation and improved metallurgical response," he said.

"The rapid growth in ore reserves at Razorback coincides with the company's transformation in readiness to lead the development of the project, and the increasing interest of regional iron and steelmakers and major supply chain investors in securing the premium grade ore necessary to achieve low carbon steel production."

Dobson said it was encouraging to see that Iron Peak remained open at depth and along strike.

The recovery rate for the maiden 362Mt was 16.8%.

With a revised ore reserve on hand, the project economics have also been updated, with Magnetite Mines now mulling two magnetite concentrate production options; a base case fixed output 5Mt per annum operation or an expansion option that would grow from 5Mtpa to 10Mtpa after five years.

According to the base case, a $1.94 billion mine would have a mine life of 91 years and operating costs of between $68-$82 per tonne.

Dobson said the project update combined successful delivery of the optimisation study phase with the maiden ore reserve for Iron Peak, which had been prioritised for production in the project plan and improved the first 10 years' economics significantly.

"Our financial modelling has been deliberately conservative, incorporating adequate contingencies and acknowledging the recent inflationary cycle, while also reflecting emerging product price premiums for premium-grade iron ore products that are forecast to increase over the coming years as the global steel industry delivers on its urgent decarbonisation commitments," he said.

"Our next steps are to de-risk the final elements of Razorback's infrastructure requirements, which will allow us to complete a definitive feasibility study and begin a partnering process aimed at sharing capital and marketing risk with quality partners to deliver the best possible outcome for Magnetite Mines shareholders."