Namibia Rare Earths Files 43-101 Preliminary Economic Assessment Report for Heavy Rare Earth Mine at Lofdal
Nov 14 14
Namibia Rare Earths Inc. announced that it has filed a National Instrument 43-101 technical report titled Preliminary Economic Assessment on the Lofdal Rare Earths Project Namibia. The effective date of the PEA is October 1, 2014. The PEA concludes that the Project currently has the potential to produce an average of 1,500 tonnes per annum of separated rare earth oxides (REO) which would generate after tax cumulative cash flow of USD 259 million with a net present value(10%) (NPV) of USD 148 million and an internal rate of return (IRR) of 42%. The PEA indicates that there is considerable potential to expand the current mineral resource and recommends that additional drilling be carried out to provide for an extended mine life in conjunction with a six month Prefeasibility Study (PFS) program. The PEA should not be considered to be a pre-feasibility or feasibility study, as the economics and technical viability of the Project has not been demonstrated at this time. The PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves. Furthermore, there is no certainty that the PEA will be realized. Mineral Resource Estimate: The PEA utilized the initial NI 43-101 mineral resources for the Area 4 deposit at a cut-off grade of 0.1% total rare earth oxides (TREO) which provides 2.88 Mt of Indicated mineral resources yielding 9,230 t of REO, of which 7,050 t are estimated to be Heavy Rare Earth oxides (HREO) and 3.28 Mt of Inferred mineral resources yielding 8,970 t of REO, of which 6,700 t are estimated to be HREO. These REO and HREO tonnages are rounded to the nearest 10 t but are shown as originally calculated in Table 3. The remainder of the REO is made up of Light Rare Earth oxides (LREO). Mining and Processing: Mining will be by conventional open pit methods utilizing an owner operated mine fleet at a mining rate of 2,500 tpd (840,000 tpa) with the ultimate pit reaching a vertical depth of 200 meters. A total of 6.04 MT of mineralized material at a diluted grade of 0.28% TREO will be provided to the primary crusher over the 7 1/4 year life of mine (LOM). Following secondary and tertiary crushing the feed is delivered to x-ray technology (XRT) and x-ray fluorescent (XRF) sorters to eliminate internal waste thereby reducing volume to the ball mill for fine grinding. Ball mill product slurry is fed to the rougher magnetic separator with tails going through three scavenger magnetic stages. The magnetic concentrate product is subjected to a cleaner flotation circuit and then passes through a concentrate thickener prior to the acid leach circuit. The leach circuit utilizes a four stage hydrochloric acid (HCl) leach to dissolve the carbonate minerals. A gangue leach centrifuge circuit provides for a primary acid water wash to remove the entrained dissolved calcium chloride solution and a secondary potable water wash with a second centrifuge for solid-liquid separation. The resultant solids are filtered in a filter press for final concentrate bagging and shipping to a hydrometallurgical facility which is proposed to be located at the deep water port of Walvis Bay. Concentrate batches of 29 tonnes each will be shipped in containers over a distance of 375 kilometers to the hydrometallurgical facility for caustic cracking and washing. The caustic cracking plant is designed for the purpose of breaking or cracking the phosphate component of the rare earth mineral xenotime in order to access the contained thorium for removal by subsequent HCl leaching. Following the caustic cracking stage the washed residue is transferred to the HCl digestion tank to leach the thorium. Subsequent precipitation steps will produce a thorium hydroxide product for storage and a rare earth hydroxide product to be combined with the HCl digestion residue as a final product for drying and drumming. The Project is not of sufficient scale to support capitalization for a separation plant and it is envisioned that the final product will be delivered to a third party facility and subject to an offshore treatment charge. Capital Costs: The total capital costs for the Project are estimated at USD 162,935,000 and include direct capital costs for mining, mill site processing facilities, cracking plant processing facilities, tailings storage facility and camp allowance; sustaining capital; closure costs; indirect costs and contingency . Indirect costs, including EPCM, owner's costs, first fills and spares have been estimated at 30% of direct costs. The contingency has been estimated at 20% of the total of direct costs plus indirect costs. Operating Costs: Operating costs include the costs of the owner operated mine fleet, processing at the mill site and cracking plant facility, transportation costs for concentrates from the mine site to Walvis Bay and from port to an offshore treatment facility for separation. Technology Metals Research of the United States has indicated that a tolling charge of USD 15-20/kg of finished REOs would be a reasonable estimate for the processing (outside of China) of an intermediate concentrate with a rare earth element distribution similar to the one associated with the Lofdal project to commonly required purity levels and finished forms. Rare Earth Pricing: A price deck has been developed for 2017 by Technology Metals Research and Core Consultants, based on REO supply/demand projections and pricing models for that year, which would be a reasonable approximation of when Lofdal might be expected to enter production. The nature of the REE market is such that it does not lend itself to traditional models for commodity forecasting. In analysing potential future prices, consideration is given to the likely relative surplus or deficit of REEs available to the market, in order to gain a sense of price direction. Two key assumptions made in the price projections are that China maintains its production targets of 100,000-105,000 tonnes in the near to medium term, and that there are no sudden or unexpected policy changes in China that would shock the export market as occurred in 2010/2011. The economic analysis assumes that the Project will be 100% equity financed and uses parameters relevant as of September 2014, under conditions likely to be applicable to project development and operation and analyzes the sensitivity of the Project to changes in the key Project parameters. All costs have been presented in United States Dollars (USD) and wherever applicable conversion from South African Rand (ZAR) has utilized an exchange ratio (ZAR/USD) of 10.70 based on July 2014 exchange rates. Mining and treatment data, capital cost estimates and operating cost estimates have been put into a base case financial model to calculate the IRR and NPV based on calculated Project after tax cash flows.
Richard Surratt Joins Namibia Rare Earths as Vice President Corporate Development and Strategic Initiatives
Oct 6 14
Namibia Rare Earths Inc. reported that Richard Surratt has joined the senior management team at Namibia Rare Earths in the role of Vice President Corporate Development and Strategic Initiatives. Mr. Surratt has held senior management positions with various public and private companies over the last 25 years including with Mobil Corporation in the roles of Director, Major Transactions Group; Treasurer, Latin America; Senior Associate-Global Capital Markets; and Senior Financial Analyst.
Namibia Rare Earths Inc. - Special Call
Oct 1 14
To discuss the results of the NI 43-101 compliant Preliminary Economic Assessment on the Lofdal Rare Earths Project, Namibia