Browns Range moving to Definitive Feasibility Study

Transcription

1 Browns Range moving to Definitive Feasibility Study Highlights Northern Minerals (ASX: NTU; the Company or NTU) is making great progress moving the Browns Range Project (the Project or Browns Range) to a Definitive Feasibility Study (DFS). The NTU team has undertaken, and is continuing to undertake, a significant work program to feed into the Project s DFS. This work has included geotechnical and grade control drilling, finance and offtake discussions, granting of the Project s final tenement, process and engineering design and commencement of several procurement activities to underpin DFS cost estimates. Further processing testwork has also achieved the best overall total rare earth oxide* (TREO) recovery of 81.1% and process circuit recovery for dysprosium of 83.4% to date. The work completed maintains the Project s pathway to production and further strengthens NTU s opportunity to become the first significant world producer of dysprosium outside of China. Proposed Browns Range processing facility * TREO = Total Rare Earth Oxides La 2, CeO 2, Pr 6 O 11, Nd 2, Sm 2, Eu 2, Gd 2, Tb 4 O 7, Dy 2, Ho 2, Er 2, Tm 2, Yb 2, Lu 2, Y 2

2 Approvals and Tenure The WA Government has granted Northern Minerals tenure of miscellaneous licence L80/76 which covers parts of the proposed mine access road and water supply. The Company now holds secure tenure over M80/627, L80/77 and L80/76 which are all the tenements required to implement the Project (see project area tenure map below). With the primary environmental approval granted by the WA Minister for the Environment in October, work on the secondary environmental approvals is underway. The Project s mining proposal and project management plan applications for early works are to be lodged with the Department of Mines and Petroleum in the coming months. Applications for water supply and environmental works approvals are progressing in parallel. The Company is currently working with the Shire of Halls Creek on finalisation of a Road Access and Maintenance Deed for the upgrade and ongoing maintenance of the Duncan and Gordon Downs roads, which link the Project to Halls Creek. Project area tenure map

3 Processing The recoveries for the DFS have been finalised following completion of the third hydrometallurgical pilot plant run and additional beneficiation testwork. Compared to the Pre-Feasibility Study (PFS), the recovery of TREO has improved from 78.4% to 81.1%, while the overall process circuit recovery for dysprosium has also improved from 83.3% to 83.4%. Purification circuit at ANSTO Pilot Plant Further process work for the DFS has developed a flowsheet that has the ability to produce either a mixed rare earth (RE) carbonate as a final product, or an oxalate which can be calcined to a mixed RE oxide as the final product. The base case flowsheet for the DFS will be to produce a mixed RE carbonate. The production of a carbonate will reduce the costs of reagents and heating, as the carbonate does not need to be calcined. The mixed RE carbonate contains 57% TREO and 9.2% Dy/TREO, with the deleterious elements in the carbonate at levels that meet or are lower than downstream separation requirements. In addition, supplementary testwork undertaken at ANSTO shows promise in reducing reagent costs in the purification step of the hydrometallurgical flowsheet. Indirect fired rotary kiln at ANSTO Pilot Plant Mining A drill program was completed in November at Wolverine for the purpose of gathering close spaced drill data for the development of a grade control strategy. A total of 72 RC drill holes were completed for 3,554m, with assays currently pending. Additional geotechnical drilling has been undertaken to provide data for the open pit and underground mine designs. Two geotechnical diamond holes were drilled for the proposed Wolverine underground workings, which included the portal and upper decline positions, and six geotechnical diamond holes were drilled for the proposed Gambit West open pit. The data is currently being analysed and developed to DFS level for the Wolverine pit, Gambit West pit and Wolverine underground. A paste backfill study, including testwork, is underway after underground mining design and scheduling studies indicated that a change of mining method to longitudinal open stoping will require paste backfill underground. A number of other studies are also underway including ventilation and mine dewatering.

4 Stakeholder Engagement The Company was pleased to host Josie Farrer MLA, Member for the Kimberley at the Project. While on site Josie met with Northern Minerals employees and visited the Wolverine and Gambit deposits. Work continues on implementing the Co-existence Agreement with the Jaru People, with a second Implementation Committee meeting held in Broome. Furthermore, the Company held its annual end of year community BBQ in Ringer Soak. Josie Farrer MLA visit to Browns Range Marketing and Offtake The last week has seen rare earth prices, largely elements such as dysprosium and terbium, rise. More specifically the dysprosium price increased by 2.33% according to Argus Metal Pages. Commentators are attributing the price increase to policy changes by the Chinese Government, particularly the recent strategy to recommence stockpiling through a national buying campaign. Through this campaign the Chinese Government has commenced stockpiling of strategically significant rare earths such as dysprosium. As stockpiling continues, less product will be available on market resulting in continued pricing pressure for supply outside of China. Community BBQ Ringer Soak, December 2014 Northern Minerals attended the Metal Events Ltd s 10 th International Rare Earths Conference in Singapore. At the conference NTU met with senior representatives of Sumitomo Corporation and a number of other potential offtake partners who were impressed with the Project s progress to date as well as the outcomes of the PFS. A number of follow up discussions are continuing. Funding Following the Project receiving its primary environmental approval, senior company representatives visited the United States and China to progress discussions regarding project financing. Meetings were held with a number of funds and investment houses. The visit was encouraging, generating further interest and positive feedback with a number of discussions ongoing. Definitive Feasibility Study The DFS is progressing rapidly with a number of key activities complete or underway: Proposed Beneficiation Plant An infrastructure geotechnical program has been completed at Browns Range to provide information for the DFS as well as detailed engineering design.

5 The process flowsheet diagrams, piping and instrument diagrams, and equipment lists for the process plant are complete. The site layout and 3D model of the process plant is complete with material take offs nearing completion. Studies and design to DFS level of nonprocess infrastructure (e.g. roads, village, airstrip, water supply and communications) is complete. The tailings storage facility study is complete. Procurement activities required to underpin the capital and operating cost estimates for the DFS have commenced. Request for quotations have been issued and returned for open pit and underground mining contracts. Proposed Hydrometallurgical Plant The recent strengthening of the US dollar has seen the AUD:USD exchange rate drop to a four year low of around 0.83 this week, which reinforces NTU s decision to use a 0.80 exchange rate for the PFS. While at the time the AUD:USD exchange rate was at around 0.93, the Company s long term view was that this strong exchange rate would not be sustainable over the Project s 10 year mine life. Given market conditions NTU remains confident that a 0.80 exchange rate is a realistic assumption for the Project and will continue to use this exchange rate for the DFS, in conjunction with commodity price assumptions. Pathway to Production The DFS is on track for completion at the end of February 2015, with the project implementation plan and schedule currently being reviewed and developed for inclusion in the DFS. Pathway to Production

6 Name Company Contact George Bauk Managing Director / CEO Northern Minerals Linda Reddi Senior Public Affairs Advisor Northern Minerals Ryan McKinlay / Michael Vaughan Cannings Purple About Northern Minerals: Northern Minerals Limited (ASX: NTU) is focussed on the becoming a globally significant producer of the heavy rare earth (HRE), dysprosium. NTU has a large landholding in Western Australia and the Northern Territory that is highly prospective for this element. NTU s 100% owned flagship project is the Browns Range Project (the Project), where it has a number of deposits and prospects containing high value dysprosium and other HREs, hosted in xenotime mineralisation. Dysprosium is an essential ingredient in the production of NdFeB (neodymium iron-boron) magnets used in clean energy and high technology solutions. As a result of increasing global demand for these applications dysprosium supply is critical. The Project s xenotime mineralisation facilitates the use of a relatively simple and cost effective processing flowsheet to produce a high grade dysprosium rich mixed rare earth carbonate. The Company is targeting construction to commence in 2015, followed by production in late Exploration is also underway at the geologically similar John Galt and Boulder Ridge projects. For more information northernminerals.com.au.