by Greg Klein | April 7, 2016
Commerce Resources TSXV:CCE marked the beginning of a relationship with NorFalco Sales, a division of Glencore Canada Corp, on April 7. Under a binding memorandum of understanding, NorFalco would supply sulphuric acid at “highly competitive market rates and terms” for metallurgical use on Commerce’s Ashram rare earths project.
Commerce currently has the northern Quebec project advancing towards pre-feasibility. NorFalco is one of the continent’s largest traders of sulphuric acid through its fully integrated distribution network. NorFalco also holds offtake agreements with several producers outside the Glencore group.
The MOU has an initial five-year term, after which an extension may be negotiated.
“This agreement is a significant first step in what we expect to be a meaningful ongoing supply relationship with NorFalco,” said Commerce president Chris Grove. “The nature of this agreement today is that it is a benefit to the Ashram project with favourable pricing for one of the largest project consumables. We look forward to working with NorFalco.”
This agreement is a significant first step in what we expect to be a meaningful ongoing supply relationship with NorFalco.—Chris Grove, president of Commerce Resources
Should the relationship develop further, it might hold potential for rare earths and/or byproduct supply from Ashram. Commerce has been making pre-feas progress on a number of fronts. Metallurgical pilot plant tests announced in February suggest a simplified flowsheet that would cut costs. Ashram’s high-grade, near-surface deposit has undergone infill drilling for a resource update. The company’s community relations, meanwhile, brought Commerce an award for responsible exploration from l’Association de l’exploration minière du Québec.
In January Commerce closed a private placement totalling $1.97 million. In late February the company filed a final short form prospectus for an offer between $1 million and $3 million.
A distinguishing feature of Ashram, the deposit is hosted in the minerals monazite, bastnasite and xenotime, which have proven processing techniques for rare earths. The REE distribution shows enrichment in critical and magnet feed elements.
The company also holds the Blue River tantalum-niobium deposit in southeastern British Columbia, with a 2011 PEA and a 2013 resource update.