(MENAFN- ProactiveInvestors)
() now has global resources of over 1 billion tonnes after upgrading the resource estimate for its Kvanefjeld uranium and rare earth project in Greenland.
Adding to the interest the Kvanefjeld Deposit now has a Measured Resource of 143 million tonnes at 303ppm U3O8 1.2% total rare earth oxides and 0.24% zinc.
This will form the basis for establishing an initial mine reserve following completion of the feasibility study which is nearing completion and will be the start point of mining operations.
SRK Consulting which carried out the new resource estimate will soon finalise a new mine schedule with improved grades expected in the coming weeks.
Managing director John Mair told Proactive Investors exclusively:
“We’re very pleased with the result. SRK have worked on the project since 2010 and have done a very thorough job. 143 million tonnes in the measured category will form the basis for several decades of mining.
“It’s a bonus to see global resources now exceed 1 billion tonnes and the upside remains huge – realistically we’ve only just scratched the surface.
“Kvanefjeld is a globally unique project; not just because of the resource scale but importantly because of the unique mineralogy that allows for production across the full rare earth spectrum (heavy middle and light) at the right market proportions in addition to uranium production along with zinc concentrate.”
The update confirms the project is underpinned by one of the world’s largest undeveloped JORC 2012 compliant resources of both rare earth elements and uranium.
The project area has three established mineral resources at Kvanefjeld Sørensen and Zone 3.
This was undertaken following an increase in the density of geochemical data at the Kvanefjeld deposit that was generated from the recent assay program on historically drilled cores.
Resource estimates for the Sørensen and Zone 3 deposits remain unchanged.
Kvanefjeld Deposit
Under the Resource update the company has increased overall resources at the Kvanefjeld Deposit by 8.7% to 673 million tonnes containing 368 million pounds U3O8 (5% increase) and 7.4 million tonnes TREO (12% increase).
In addition the Measured resource includes a higher grade resource of 54 million tonnes at 403ppm U3O8 1.4% TREO and 0.24% zinc.
The Measured resources form the uppermost part of the Kvanefjeld deposit and are readily accessible for mining.
Project global resources – including the Sørensen and Zone 3 - now stand at 1.01 billion tonnes containing 593 million pounds U3O8 11.13 million tonnes TREO.
Feasibility Study
The feasibility study is evaluating a mine concentrator and hydrometallurgical refinery in Greenland treating 3 million tonnes of ore per annum.
The concentrator will produce 230000 tonnes per annum of a rare earth mineral concentrate which contains 14% REO and 0.25% U3O8.
Engineering design work by Tetra Tech one of the major work programs that underpin the feasibility study for the study was completed in early December 2014.
This was handed over to China Non‐Ferrous Metal Industry’s Foreign Engineering and Construction Co. Ltd (NFC) for cost estimation which is nearing completion.
All resources at the Kvanefjeld project have been rigorously defined and are domained by mineralogical characteristics. This is important to the metallurgy program and allows for predictable performance through the ore bodies.
Coalition Government
Supporting development of the project Greenland’s recent election saw the pro-uranium Siumut Party return to power at the head of a new coalition government.
The parties that form the coalition are all of a pro-uranium position and for advancing initiatives with Denmark on regulatory matters associated with uranium production which had progressed considerably through 2014.
This is seen as a positive for Greenland for foreign investment; and in particular the successful future development of the Kvanefjeld project.
Analysis
With global resources now standing over 1 billion tonnes with a Measured Resource of 143 million tonnes at 303ppm U3O8 1.2% total rare earth oxides and 0.24% zinc Kvanefjeld stands clearly as one of the world’s largest undeveloped JORC-compliant rare earth elements and uranium projects.
The updated mining schedule should be available in the coming weeks and the company will be finalising the feasibility study through the first quarter and will look to present the outcomes to market in early Q2.
The time is right with life returning to the uranium sector after Japan moved to restart its reactors while China moves away from an export quota system for rare earths and imposes internal taxes on miners.
Share price kickers are:
- Delivery of the new mine schedule;
- Defining the first mining Reserve;
- Release of the Feasibility Study;
- Start of the permitting process (Q3); and
- Results from the EURARE test work.
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