Indicated Lithium Resource at Cinovec Increased

RNS Number : 9161P

Rare Earth Minerals PLC

23 November 2016

 

Rare Earth Minerals Plc

("Rare Earth Minerals", "REM" or "the Company")

Indicated Lithium Resource at Cinovec Increased by 420%

Rare Earth Mineral Plc (AIM/ISDX: REM; OTC: REMMY) is pleased to report a interim upgrade on the Mineral Resource for the Cinovec lithium / tin project in the Czech Republic, which has seen the Indicated Mineral Resource increase by 420% from 0.5 Mt LCE to 2.6Mt LCE. In addition, the total resource increase 11.8% from 5.7Mt LCE to 6.46 Mt LCE.

The significant increase in the indicated portion of the Mineral Resource, and the resource in total, will have a positive impact for mine planning and the life of mine. The updated Mineral Resource will allow management to optimise the mine plan and maximise Cinovec's financial returns and further progress in the ongoing pre-feasibility study, which is due for publication at the end of March next year.

REM holds a 17.57% economic interest in the project, via its interest in European Metals Holdings Limited ("EMH"). On the 18 November 2016 EMH held its Annual General Meeting, in which REM placing in EMH was approved. It is anticipated that this will complete over the next few days after which REM will hold 20.76% of EMH.

The full EMH announcement can be found at: http://europeanmet.com/assets/23_Nov_2016_-_Upgrade_of_Mineral_ResourcesFinal.pdf .

Highlights:

·   Lithium Indicated Resource increased 420% to 2.6 Mt LCE, contained in 232.8 Mt @ 0.45% Li₂O (0.1% Li cutoff)

·   Lithium Total Resource increased 11.8% to 6.46 Mt LCE, contained in 606.8 Mt @ 0.43% Li₂O (0.1% Li cutoff)

·   Tin Indicated Resource increased by 64% to 28.6 Mt @ 0.23% Sn, 0.54% Li₂O (0.1% Sn cutoff) for 65.8 kt Sn, 0.38 Mt LCE

·   Results from the drilling programme support the original Cinovec model. Management are confident that additional drilling will result in further significant resource upgrades.

·   Lithium Exploration Target remains 350 to 450 Mt @ 0.39% to 0.47% for 3.4 Mt to 5.3 Mt of LCE.

Kiran Morzaria, the Chief Executive Officer of REM, commented:

"The increase in Indicated Mineral Resource to 2.6Mt of LCE at the Cinovec lithium / tin project is an excellent result from the drilling, interpretation and geological modelling that has occurred over the last few months. This work has not only succeeded in delivering substantial increase in the mineral resource, but it has also, critically, delivered a substantial the indicated portion of mineral resource. This will allow the management to maximise the economic returns by targeting high grade sections of the deposit.

"In addition, the conceptual target of between 3.4Mt and 5.3Mt LCE, further illustrates that the Cinovec lithium / tin project still has ample scope for expansion, either in size or in production capacity."

Mineral Resource Upgrade

Independent expert Lynn Widenbar of Widenbar and Associates updated the Mineral Resource Estimates. Mr Widenbar has compiled all resource estimates at Cinovec to-date.

Total Indicated and Inferred lithium resources (see Table 1) at 0.1% Li cut-off are now:

·     606.8 Mt @ 0.43% Li₂O for 6.46 Mt LCE

Total Indicated and Inferred tin resources (see Table 1) at 0.1% Sn cut-off are now:

·     70.5 Mt @ 0.20% Sn, 0.53% Li₂O for 141 kt Sn, 0.87 Mt LCE

Table 1: Cinovec Project Mineral Resource Estimate November 2016

	Cinovec Lithium Mineral Resource
Category			Gross
	Cut-off Li %	Tonnes (Mt)	Li %	Li2O%	LCE	Sn %	Sn t
Indicated	0.4	11.1	0.46	0.99	271,792	0.08	8,880
	0.3	39.0	0.38	0.82	788,869	0.09	35,100
	0.2	102.7	0.29	0.62	1,585,349	0.06	61,620
	0.1	232.8	0.21	0.45	2,602,308	0.04	93,120
Inferred	0.4	6.3	0.47	1.01	157,614	0.07	4,410
	0.3	25.6	0.37	0.80	504,194	0.07	17,920
	0.2	126.9	0.26	0.56	1,756,271	0.05	63,450
	0.1	374.0	0.19	0.41	3,782,524	0.04	149,600

	Cinovec Tin Mineral Resource
Category			Gross
	Cut-off Sn %	Tonnes (Mt)	Sn %	Sn t	Li %	Li2O%	LCE
Indicated	0.4	2.8	0.67	18,760	0.29	0.62	43,223
	0.3	5.1	0.52	26,520	0.29	0.62	78,727
	0.2	10.4	0.38	39520	0.27	0.58	149,470
	0.1	28.6	0.23	65,780	0.25	0.54	380,594
Inferred	0.4	1.6	0.71	11,360	0.25	0.54	21,292
	0.3	3.2	0.52	16,640	0.24	0.52	40,881
	0.2	9.2	0.34	31,280	0.24	0.52	117,532
	0.1	41.9	0.18	75,420	0.22	0.47	490,674

Notes:

1. Mineral Resources are not reserves until they have demonstrated economic viability based on a feasibility study or pre-feasibility study.

2. Mineral Resources are reported inclusive of any reserves and are prepared by Widenbar in accordance with the guidelines of the JORC Code (2012).

3. The effective date of the Mineral Resource is November 2016.

4. All figures are rounded to reflect the relative accuracy of the estimate.

5. The operator of the project is Geomet s.r.o., a wholly-owned subsidiary of EMH. Gross and Net Attributable resources are the same.

6. Any apparent inconsistencies are due to rounding errors.

7. LCE is Lithium Carbonate Equivalent and is equivalent to Li₂CO_3.

The Cinovec database used for the Mineral Resource Estimate incorporates information derived from almost 800 historic underground and surface diamond drill holes, historic underground channel sampling as well as the 18 surface diamond holes drilled to date by European Metals. A total of 71,312 assay intervals are now included in the database.

Historically, core samples were either split or consumed entirely, with intervals ranging from 0.03 to 10.5m; more than 99.75% of historic drill samples fall in a range between 0.1 and 3m long. Historic channel samples were collected across 1m intervals. Samples collected from 2014, 2015 and 2016 holes drilled by European Metals comprised half core and honoured geological contacts and mineralised domains, ranging from 0.5 to 2.1m long.

Historic analytical methods included XRF and wet chemical techniques; samples collected from the new holes were analysed by fusion or 4 acid digest with ICP finish. Assay data were composited to 1m intervals prior to Mineral Resource estimation.

Sample spacing used in Mineral Resource estimation for tin ranges from continuous channel sampling up to approximately 100m. The range reflects the density of historical work - samples are very closely spaced in areas of underground development and trial mining, less so in areas sampled only by surface or underground drill holes.

Sample spacing used for lithium Mineral Resource estimation is wider, as development samples were not assayed for lithium; sample spacing typically ranges from 50m to 200m. Note that only blocks in the lithium model which had an average distance to samples used of less than 90m were assigned to the Mineral Resource, with the remainder considered to form part of an Exploration Target.

At a 0.1% Li cutoff, the Exploration Target is:

• 350 to 450 Mt @ 0.39 to 0.47% Li2O for 3.4 to 5.3 Mt LCE

The Sn-W-Li mineralisation is hosted in an alkalic granite dome of late Variscan age. Tin and tungsten occur mainly in oxide minerals (cassiterite and wolframite). Lithium occurs mainly in zinnwaldite, a Li-rich muscovite. Quartz veining and greisenisation is associated with the mineralisation.

A geological domain model was constructed using Leapfrog software with solid wireframes representing greisen, granite, greisenised granite and the overlying barren rhyolite. This was used to both control interpolation and to assign density to the model.

Analysis of sample lengths indicated that compositing to 1m was necessary. Search ellipse sizes and orientations for the estimation were based on drill hole spacing, the known orientations of mineralisation and variography. An "unfolding" search strategy was used which allowed the search ellipse orientation to vary with the locally changing dip and strike.

After statistical analysis, a top cut of 5% was applied to Sn% and W%; no top cut is applied to Li%. Sn%, W% and Li% were then estimated by Ordinary Kriging within the geological solids.

The primary search ellipse was 150m along strike, 150m down dip and 7.5m across the mineralisation. A minimum of 4 composites and a maximum of 8 composites were required. A second interpolation with search ellipse of 300m x 300m x 12.5m was carried out to inform blocks to be used as the basis for an exploration target. Block size was 5m (E-W) by 10m (N-S) by 5m

Validation of the final resource has been carried out in a number of ways including section comparison of data versus model, swathe plots and production reconciliation.

Densities applied for Mineral Resource tonnage calculations are based on historical bulk density measurements of 2.57 for granite and 2.70 for greisen, confirmed by laboratory measurements in 2016.

The impact of the new European Metals drill holes on the geological model and the block model have been reviewed. Globally the geology and resource model are similar to the previous (May 2016) model, with only relatively minor local changes to grade distributions. The increase in confidence resulting from the new drill data has allowed additional areas of the block model to be upgraded in classification from Inferred to Indicated.

Qualified Person:

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance).

- Ends -

For further information, please contact: 

Rare Earth Minerals plc

Andrew Suckling                                                                                                                           [phone]

Kiran Morzaria                                                                                                                 

WH Ireland Limited (NOMAD & Broker)                                                                             [phone]

James Joyce

James Bavister

Square1 Consulting                                                                                                                     [phone]

David Bick

Brian Alexander

TECHNICAL GLOSSARY

The following is a summary of technical terms:

"carbonate"	refers to a carbonate mineral such as calcite, CaCO3
"cut-off grade"	lowest grade of mineralised material considered economic, used in the calculation of Mineral Resources
"deposit"	coherent geological body such as a mineralised body
"exploration"	method by which ore deposits are evaluated
"g/t"	gram per metric tonne
"grade"	relative quantity or the percentage of ore mineral or metal content in an ore body
"Indicated" or "Indicated Mineral Resource"	as defined in the JORC and SAMREC Codes, is that part of a Mineral Resource which has been sampled by drill holes, underground openings or other sampling procedures at locations that are too widely spaced to ensure continuity but close enough to give a reasonable indication of continuity and where geoscientific data are known with a reasonable degree of reliability. An Indicated Mineral Resource will be based on more data and therefore will be more reliable than an Inferred Mineral Resource estimate
"Inferred" or "Inferred Mineral Resource"	as defined in the JORC and SAMREC Codes, is that part of a Mineral Resource for which the tonnage and grade and mineral content can be estimated with a low level of confidence. It is inferred from the geological evidence and has assumed but not verified geological and/or grade continuity. It is based on information gathered through the appropriate techniques from locations such as outcrops, trenches, pits, working and drill holes which may be limited or of uncertain quality and reliability
"JORC Code"	Joint Ore Reserve Committee Code; the Committee is convened under the auspices of the Australasian Institute of Mining and Metallurgy
"kt"	thousand tonnes
"LCE"	the total equivalent amount of lithium carbonate (see explanation above entitled Explanation of Lithium Classification and Conversion Factors)
"lithium"	a soft, silvery-white metallic element of the alkali group, the lightest of all metals
"lithium carbonate"	the lithium salt of carbonate with the formula Li2CO3
"Measured" or Measured Mineral Resources"	Measured: a mineral resource intersected and tested by drill holes, underground openings or other sampling procedures at locations which are spaced closely enough to confirm continuity and where geoscientific data are reliably known; a measured mineral resource estimate will be based on a substantial amount of reliable data, interpretation and evaluation which allows a clear determination to be made of shapes, sizes, densities and grades. Indicated: a mineral resource sampled by drill holes, underground openings or other sampling procedures at locations too widely spaced to ensure continuity but close enough to give a reasonable indication of continuity and where geoscientific data are known with a reasonable degree of reliability; an indicated resource will be based on more data, and therefore will be more reliable than an inferred resource estimate. Inferred: a mineral resource inferred from geoscientific evidence, underground openings or other sampling procedures where the lack of data is such that continuity cannot be predicted with confidence and where geoscientific data may not be known with a reasonable level of reliability
"metallurgical"	describing the science concerned with the production, purification and properties of metals and their applications
"Mineral Resource"	a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such a form that there are reasonable prospects for the eventual economic extraction; the location, quantity, grade geological characteristics and continuity of a mineral resource are known, estimated or interpreted from specific geological evidence and knowledge; mineral resources are sub-divided into Inferred, Indicated and Measured categories
"mineralisation"	process of formation and concentration of elements and their chemical compounds within a mass or body of rock
"Mt"	million tonnes
"ppm"	parts per million
"recovery"	proportion of valuable material obtained in the processing of an ore, stated as a percentage of the material recovered compared with the total material present
"stope"	underground excavation within the orebody where the main production takes place
"t"	a metric tonne
"tin"	A tetragonal mineral, rare; soft; malleable: bluish white, found chiefly in cassiterite, SnO2
"treatment"	Physical or chemical treatment to extract the valuable metals/minerals
"tungsten"	hard, brittle, white or grey metallic element. Chemical symbol, W; also known as wolfram
"W"	chemical symbol for tungsten

ADDITIONAL GEOLOGICAL TERMS

"apical"	relating to, or denoting an apex
"cassiterite"	A mineral, tin dioxide, SnO2. Ore of tin with specific gravity 7
"cupola"	A dome-shaped projection at the top of an igneous intrusion
"dip"	the true dip of a plane is the angle it makes with the horizontal plane
"granite"	coarse-grained intrusive igneous rock dominated by light-coloured minerals, consisting of about 50% orthoclase, 25% quartz and balance of plagioclase feldspars and ferromagnesian silicates
"greisen"	A pneumatolitically altered granitic rock composed largely of quartz, mica, and topaz. The mica is usually muscovite or lepidolite. Tourmaline, fluorite, rutile, cassiterite, and wolframite are common accessory minerals
"igneous"	said of a rock or mineral that solidified from molten or partly molten material, i.e., from a magma
"muscovite"	also known as potash mica; formula: KAl2(AlSi3O10)(F,OH)2.
"quartz"	a mineral composed of silicon dioxide, SiO2
"rhyolite"	An igneous, volcanic rock of felsic (silica rich) composition.  Typically >69% SiO2
"vein"	a tabular deposit of minerals occupying a fracture, in which particles may grow away from the walls towards the middle
"wolframite"	A mineral, (Fe,Mn)WO4; within the huebnerite-ferberite series
"zinnwaldite"	A mineral, KLiFeAl(AlSi3)O10 (F,OH)2; mica group; basal cleavage; pale violet, yellowish or greyish brown; in granites, pegmatites, and greisens

 

END

 

 

MSCGLBDBSUDBGLX