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Posts tagged ‘terbium’

Ashram advances

May 20th, 2014

Favourable mineralogy helps Commerce Resources move its Quebec rare earth project towards pre-feasibility

by Greg Klein

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On schedule and under budget, winter-spring drilling at Commerce Resources’ (TSXV:CCE) Ashram deposit in northern Quebec wrapped up last week, bringing one of the world’s largest rare earth projects closer to pre-feasibility. Ashram advances at a time when China’s “costs of producing ‘cheap’ rare earths are becoming increasingly unsustainable in terms of the environment, the availability of reserves, the health of its communities and the political ramifications,” according to a 28-page report by Secutor Capital Management. The study adds that China “is beginning to worry about its own domestic supply, as China is its own biggest customer.”

Favourable mineralogy helps Commerce Resources move its Quebec rare earth project towards pre-feasibility

The Ashram deposit makes Commerce Resources “one of the most
advanced REE juniors in regards to metallurgy which, in the REE space,
is everything,” according to a report by Secutor Capital Management.

That puts an interesting perspective on Commerce, “one of the most advanced REE juniors in regards to metallurgy which, in the REE space, is everything,” Secutor analysts Arie Papernick and Lilliana Paoletti stated. “The Ashram project hosts a substantial resource with a well-balanced rare earth oxide (REO) distribution. The deposit is enriched in light and heavy rare earths, including all five of the critical elements. The mineralogy is simple due to the presence of the minerals monazite, bastnaesite and xenotime, which currently dominate commercial processing. Unlike many of its competitors, Commerce is able to produce a 43.6% total rare earth oxide (TREO) mineral concentrate due to the deposit’s simple mineralogy, allowing significant cost reductions.”

According to Ashram’s 2012 preliminary economic assessment, the extent of those critical elements—neodymium, europium, terbium, dysprosium and yttrium—is “unusual in carbonatite deposits and especially those of such tonnage and grade.”

That resource used a cutoff of 1.25% total rare earth oxide to estimate a measured and indicated 29.3 million tonnes averaging 1.9% TREO, and an inferred 219.8 million tonnes averaging 1.88% TREO.

As the Secutor report emphasized, “REE mineralization is virtually completely contained within the minerals monazite, bastnaesite and xenotime, allowing Commerce Resources to use standard processing techniques. In the REE industry, the ability to use conventional metallurgy and processing is rather unique. Only four REE-bearing minerals out of over 200 have ever supplied the market in a material fashion. These four minerals currently, and historically, dominate commercial REE processing and are host to the REEs at Ashram.”

The 43.6% TREO concentrate, at a recovery of 70.7%, comprises “one of the highest-grade REE mineral concentrates which we are aware of produced by a junior mining company globally.”

It’s considerably higher than that of Ashram’s 2012 PEA, which anticipated reaching a target of 20% TREO at a recovery of 60% to 70% “through an established and commercially proven technology.” Yet the PEA’s base case considered a concentrate grading 10% TREO at 70% recovery.

In the REE industry, the ability to use conventional metallurgy and processing is rather unique.—Secutor Capital Management analysts Arie Papernick
and Lilliana Paoletti

The study used a 10% discount rate to project Ashram’s pre-tax, pre-finance net present value at $2.32 billion and a 44% internal rate of return. The capex, including contingency, came to $763 million with payback in 2.25 years. The PEA envisioned a 4,000-tonne-per-day open pit operating for 25 years—based on just 15% of the total resource.

And although rare earth prices have dropped since 2012, “the project remains robust,” Secutor maintains.

The higher-grade concentrate, with its capex and opex ramifications, is just one of the reasons analysts Papernick and Paoletti see a potentially more impressive pre-feas. Ashram’s infrastructure costs might benefit from proximity to the Lac Otelnuk iron project, 80 kilometres south. A joint venture of Adriana Resources TSXV:ADI and WISCO International Resources Development & Investment, it’s the “largest iron ore deposit in Canada with the potential of becoming one of the largest in the world,” according to Adriana. The project’s 2011 PEA calculated a $12.9-billion capex which included power and, via the link at Schefferville 165 kilometres southeast, railway to the deep sea port of Sept-Iles. Since then the Quebec government has indicated it will only permit a multi-user rail service.

Lac Otelnuk has full feasibility scheduled for completion by year-end.

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Athabasca Basin and beyond

June 15th, 2013

Uranium news from Saskatchewan and elsewhere for June 8 to 14, 2013

by Greg Klein

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Cameco’s Cigar Lake granted mining licence

With production slated for Q4, Cameco Corp TSX:CCO got the final go-ahead to mine Cigar Lake uranium on June 13. The Canadian Nuclear Safety Commission issued the mining licence following a 1990s environmental assessment, a stalled construction phase and a one-day public hearing. “The licensed facilities include underground mine workings accessed by two mine shafts, a surface load-out facility, waste management systems, a mine water management system and associated site facilities,” the CNSC stated. Cameco expects jet-boring to begin this summer.

The world’s second-largest known high-grade uranium deposit, Cigar Lake’s bounty holds:

  • proven reserves of 233,600 tonnes averaging 22.31% uranium oxide (U3O8) for 114.9 million pounds U3O8
  • probable reserves of 303,500 tonnes averaging 15.22% for 101.8 million pounds.

Those reserves give Cigar Lake a 15-year lifespan. With full production expected in 2018, it’s expected to give up 18 million pounds annually.

Cameco’s Cigar Lake granted mining licence

A Cameco crew installs freeze pipes at Cigar Lake
to protect against seeping water and leaking radiation.

The peak of construction could employ up to 500 workers, while production would require about 250 people. Jet-boring will extract the highly radioactive material using water pressure to carve underground caverns and push an ore slurry to underground grinding and thickening circuits, then to surface. The ground first must be frozen to prevent water seepage and radiation leakage. Processing will take place at the McClean Lake mill, 69 kilometres away.

Construction actually began in 2005. But the project hit delays due to flooding in 2006 and 2008. Cameco finally dewatered the workings in 2010 and restored the underground infrastructure the following year.

Located near Waterbury Lake on the Athabasca Basin’s eastern margin, Cigar Lake is a four-way joint venture in which project operator Cameco holds 50.025%, AREVA Resources Canada 37.1%, Idemitsu Canada Resources 7.875% and TEPCO Resources 5%. Another JV, the McClean Lake mill is held 70% by operator AREVA, 22.5% by Denison Mines TSX:DML and 7.5% by OURD Canada.

Pele Mountain increases Eco Ridge inferred U3O8 136%, REO 130%

Replacing a previous uranium-rare earths resource in the project’s July 2012 preliminary economic assessment, Pele Mountain Resources TSXV:GEM released a June 10 update for its Eco Ridge project in Elliot Lake, Ontario. The resource now shows:

  • an indicated category of 22.74 million tonnes averaging 0.045% U3O8 and 1,606 parts per million total rare earth oxides for 22.55 million pounds U3O8 and 80.51 million pounds REO, or 49.83 million pounds U3O8-equivalent
  • an inferred category of 36.56 million tonnes averaging 0.047% U3O8 and 1,554 ppm REO for 37.62 million pounds U3O8 and 125.25 million pounds REO, or 81.84 million pounds U3O8-equivalent.

The inferred numbers represent a 130% increase in total REO and a 136% jump in U3O8. The indicated category rose 10% in both REO and U3O8. The update shows “substantial increases in critical REO resources including neodymium, dysprosium, yttrium, terbium and europium oxides, as well as in scandium oxide resources,” the company stated.

Pele Mountain added that two higher-grade zones start at surface, which could allow higher-grade production during the first years of mining.

Working in Elliot Lake between 1956 and 1996 Rio Algom, later incorporated into BHP Billiton, and Denison produced over 300 million pounds of U3O8 and significant quantities of yttrium and heavy REO from deposits similar to that of Eco Ridge, Pele Mountain stated. The mining camp is about 160 kilometres west of Sudbury.

Aldrin increases resolution of PLS-area airborne geophysics

Aldrin Resource TSXV:ALN will add infill lines to an airborne geophysics survey already underway over the Patterson Lake South area. Announced June 12, the decision will increase resolution from 200-metre to 100-metre spacing over conductive anomalies found on the company’s 12,001-hectare Triple M property. Aldrin interprets the anomalies as linear basement conductors over three kilometres long, parallel to a magnetically defined fault.

The company holds a 70% option on Triple M, which sits nine kilometres south and 11 kilometres west of the PLS discovery. High-grade, near-surface results from the Alpha Minerals TSXV:AMW/Fission Uranium TSXV:FCU 50/50 JV excited interest in the area in and around the Basin’s southwestern rim. The helicopter-borne VTEM magnetic and electromagnetic survey already underway is a joint project that’s flying contiguous properties held by Aldrin, Athabasca Nuclear TSXV:ASC (formerly Yellowjacket Resources TSXV:YJK), Forum Uranium TSXV:FDC and Skyharbour Resources TSXV:SYH. Lucky Strike Resources TSXV:LKY and Noka Resources TSXV:NX each hold a 25% earn-in option on Skyharbour’s properties.

Aldrin stated the infill lines will help locate drill targets for early winter 2014.

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Spotlight on the juniors

January 21st, 2013

Companies, investors and pundits converge on the 2013 Vancouver Resource Investment Conference

by Greg Klein

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A marketplace of ideas about the market itself—that partly describes the 2013 Vancouver Resource Investment Conference. This year the Cambridge House event brings several hundred companies together with prospective investors. But the conference also features about 50 speakers with maybe 50 divergent (although often overlapping) perspectives on the state of the juniors.

Cambridge House calls this Vancouver event the world's largest investor-focused resource exploration conference

Cambridge House calls this Vancouver event “the world’s
largest investor-focused resource exploration conference.”

Among those on hand January 20 were Michael Berry speaking on Obamanomics, Rick Rule on his love for bear markets and Chris Berry on specific critical and strategic commodities for 2013.

Canadian-born Michael Berry, co-founder of Discovery Investing, fell just short of doom and gloom in his cautionary tale about the transformation of United States economics, culture and governance. More than ever before, he said, taxation, deficit spending and redistribution of wealth are firmly entrenched as government polices. The purpose, he stated, was to remake America. The program has disturbing implications for Canada and the rest of the world, he added.

“We have now turned the corner with the second administration of Barack Obama. Politics, not economics, is now the driving force—period, end of story.”

When it comes to boosting its power, U.S. government methods are myriad: Executive orders, challenges to the constitution, the appointment of czars who aren’t checked by the constitution, redistribution of wealth, repression of investment and market manipulation of gold, silver and currency. Outright confiscation, Berry warned, has happened historically and could happen again.

Helping rationalize government policies is a government belief that “anyone in government is smarter than anyone else.” Society, meanwhile, becomes ever more polarized. “It’s not violent yet but it could be violent at some point in the future,” he warned. “It’s happened before.”

The market of course went off the cliff in 1997, so there was the ’97-to-2002 bear market, a truly dismal bear market—when my net worth skyrocketed.—Rick Rule, chairman of Sprott Global Resource Investments

But just from an economic viewpoint, the future looks bleak indeed. “Sometime around 2030, which is not all that far in the future, we will have amassed 200% federal debt relative to GDP…. That’s exactly what the Obama administration wants to do…. When that happens, the current structure will not be sustainable and the government will have to step in and reorganize the economy.”

Massive, growing government debt “is the tool the government is using to socialize the economy,” Berry stated. “It’s not a legacy we want to leave to our children. But it is a legacy with great implications for gold and silver.”

To protect themselves, Berry suggested investors “must eschew the dollar and every fiat currency you can think of,” own precious metals and consider other investments including water and infrastructure.

“I think you need to be looking at risk, thinking about risk, and those ten-baggers that will help you tread water as the U.S. moves towards an ultimate socialist state,” he concluded.

Following with good-natured overstatement was Rick Rule, chairman of Sprott Global Resource Investments. “There’s basically nothing I could say that would depress you more,” he quipped. But ever the contrarian, Rule added, “It defines me well that when everyone else seems to be depressed, I’m on my way to being elated.”

He predicted the junior bear market—the “nice, ugly bear market,” as he called it—has another 18 to 24 months to go. And for anyone who wants to make money, “it’s an extremely good thing.” It’s time to do some bargain-hunting, he maintained.

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Commerce reports Quebec REE PEA of $763M CAPEX, 44% IRR, $2.32B NPV, 10% Discount Rate, 2.25-yr Payback, 25-yr Life

May 24th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningCommerce Resources Corp TSXV:CCE announced a preliminary economic assessment for the Ashram Rare Earth Element Deposit on its Eldor Property in the Labrador Trough of northeast Quebec. The study projects a 4,000-tonne-per-day open-pit mine with a pretax/pre-finance payback period of 2.25 years, a CAPEX of $763 million (including a 25% contingency amount), a pretax/pre-finance internal rate of return of 44%, a pretax and pre-finance net present value of $2.32 billion (at a 10% discount rate) and a 25-year mine life.

The operating cost is estimated at $95.20 per tonne treated or approximately $7.91 per kilogram of rare earth oxide produced. Annual production is estimated at an average of 16,850 tonnes REO over the life of the mine, including 2,870 tonnes neodymium oxide, 96 tonnes europium oxide, 26 tonnes terbium oxide, 106 tonnes dysprosium oxide and 440 tonnes yttrium oxide.

President/CEO David Hodge commented, “The PEA displays robust economics for the Ashram Deposit and recommends the next steps for the economic evaluation of this very large and highly strategic resource. The high NPV derives partly from the value of the Ashram material in that it is enriched with all five of the critical REEs, namely neodymium, europium, dysprosium, terbium and yttrium. Management believes that significant benefits will be further realized during the next phase of metallurgy based on the test work completed to date, given the deposit’s simple mineralogy and history of successful commercial processing of Ashram’s three host minerals. We look forward to initiating the prefeasibility study to demonstrate this.”

View Company Profile

Contact:
David Hodge
President/Director
866.484.2700
604.484.2700

Read a feature story about Commerce Resources

Read an interview with David Hodge.

Disclaimer: Commerce Resources Corp is part of Zimtu Capital Corp TSXV:ZC. Zimtu is a client of OnPage Media, and the principals of OnPage Media may hold shares in Zimtu.

by Greg Klein

Elissa expands Nevada Rare Earth Drill Program

March 27th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningElissa Resources Ltd TSXV:ELI announced an expansion of the phase I drilling program at its Thor Heavy and Light Rare Earth Element Project in Nevada. The company has obtained drilling permits for additional targets in the project’s NED Area and a second rig is being mobilized. Drilling so far has examined targets along the 2.5-kilometre Lopez Trend.

The Lopez Trend is a major structural zone with a distinct geophysical signature. The NED Area is one kilometre east of the northern end of the Lopez Trend. Surface samples from both locations contain nearly all the strategic and potentially valuable rare earth elements including four that have been deemed in short supply by the US Department of Energy: neodymium, terbium, dysprosium and yttrium. Planning for a phase II drill program is now underway. The company anticipates issuing a single news release summarizing phase I results by 3Q 2012. The project is located 28 kilometres from Molycorp’s MCP Mountain Pass REE deposit and processing facility in California.

View Company Profile

Contact:
Paul McKenzie
President/CEO
604.662.3692

by Greg Klein