Operational Update - Vametco Mine

RNS Number : 7534W

Bushveld Minerals Limited

16 November 2017

 

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

16 November 2017

Bushveld Minerals Ltd

("Bushveld" or the "Company")

Operational Update - Revised Mineral Resource and Reserve Estimates for Vametco Mine

Bushveld Minerals Limited (AIM: BMN), a mineral project development company with a portfolio of vanadium and coal assets in Southern Africa and an investment in tin, is pleased to announce revised Mineral Resource Estimates and Ore Reserves for Bushveld Vametco Alloys (Proprietary) Limited's primary vanadium mine (the "Vametco Mine") in Northwest Province, South Africa.

Following the acquisition of an effective 26 per cent stake in the Vametco vanadium mine in April 2017, the Company's geologists have been working with the Vametco Mine's management to identify improvement opportunities at the mine.  The focus has been on enhancing grade control to ensure higher head grades, and thus greater vanadium throughputs into the vanadium processing plant. As part of this process, a complete review of previous Mineral Resource Estimates and Reserve declarations has been completed. Revised Mineral Resource and Ore Reserve Estimates have been undertaken by The MSA Group and reported in accordance with the JORC Code (2012). 

Fortune Mojapelo, CEO of Bushveld Minerals, said:

"We have always believed in the value proposition of bringing our geological expertise alongside the processing expertise of the Vametco Mine's management team. The interrogation of the Mineral Resources and Mineral Reserves at the Vametco Mine has shown that the revised average vanadium grades for the reserves are more in line with realised vanadium grades of the concentrate fed into the kiln.  This gives us even greater confidence about the operating efficiencies of the Vametco ore preparation/concentrating plant as we look to complete the second phase of the capacity expansion project. We anticipate further work to continue improving geological knowledge at the mine and to increase operating efficiency and overall profitability at the operation."

Highlights

During this process, a number of historic drillholes were identified as having erroneous assay data, including vanadium values inconsistent with those reported during mining operations at Vametco Mine. These erroneous drillholes have been discarded from the database used for modelling and a revised Mineral Resource has been estimated. Using this updated Mineral Resource, Ore Reserves for the mine have also been updated. The following highlights are noted:

·      Revised Mineral Resource and Ore Reserve numbers more accurately reflect actual grades achieved at Vametco Mine

·      Total reported Mineral Resource tonnages for all three magnetite seams have increased slightly from 138.62Mt to 142.4Mt

Upper Seam:

-  Inferred Mineral Resources have increased in tonnage from 8.45Mt to 11.8Mt

-  Magnetite percentage increasing from 23.56% to 37.86%

-  V₂O₅ in magnetite increasing from 0.71% to 1.70%

Intermediate Seam:

-  Indicated Mineral Resources are no longer reported, and Mineral Resources are all in the Inferred category

-  Mineral Resources have increased slightly from 19.94Mt to 21.60Mt

-  Magnetite percentage decreasing from 34.01% to 30.45%

-  V₂O₅ in magnetite decreasing from 2.35% to 1.87%

-  Ore Reserves are no longer reported for the Intermediate Seam (previously 0.35Mt of Probable Reserves were reported for this seam)

Lower Seam:

-  Both Indicated and Inferred Mineral Resources are reported

-  Indicated Mineral Resource tonnages have increased from 34.80Mt to 61.5Mt

-  Indicated magnetite percentage decreasing from 29.64% to 27.23%

-  Indicated V₂O₅ in magnetite decreasing from 2.48% to 2.01%

-  Inferred Mineral Resource tonnages have decreased from 75.43Mt to 47.40Mt

-  Inferred magnetite percentage increasing marginally from 29.09% to 29.75%

-  Inferred V₂O₅ in magnetite decreasing marginally from 2.02% to 1.99%

-  Ore Reserve tonnages decreased from 26.42Mt to 26.12Mt

-  Magnetite reserves percentage decreases from 29.76% to 26.79%

-  V₂O₅ in magnetite reserves decreasing from 2.54% to 1.96%

These revised estimates are the first step in ongoing improvements in geological control at the Vametco mine operation. Further work by the Bushveld Minerals geological team is expected to more accurately delineate areas of Ore Reserves and to use this information to improve grade control (and thereby reduce operating costs) at Vametco mine.

Table 1: Mineral Resource Estimate for Vametco Mine as at 06 October 2017

Category	Gross				Net (26.6%)
	Tonnes (millions)	Magnetite %	V2O5 % contained in magnetite	Contained Metal Total V2O5 (tonnes)	Tonnes (millions)	Magnetite %	V2O5 % contained in magnetite	Contained Metal Total V2O5 (tonnes)
Upper Seam
Inferred	11.8	37.86	1.70	75,947	3.14	37.86	1.70	20,202
Intermediate Seam
Inferred	21.6	30.45	1.87	122,994	5.75	30.45	1.87	32,716
Lower Seam
Indicated	61.5	27.23	2.01	336,604	16.36	27.23	2.01	89,537
Inferred	47.4	29.75	1.99	280,620	12.61	29.75	1.99	74,645
Sub-Total Indicated	61.5	27.23	2.01	336,604	16.36	27.23	2.01	89,537
Sub Total Inferred	80.80	31.18	1.92	479,561	21.49	31.18	1.92	127,563
Total Inferred + Indicated	142.30	27.47	1.96	816,165	37.85	27.47	1.96	217,100

Note: The operator of the mine is Bushveld Vametco Holdings (Pty) Limited

No cut-off grades have been applied owing to the consistency and uniformity of the Vametco mineralised seams

Mineral Resources are inclusive of Ore Reserves

Table 2: Ore Reserve Statement for Vametco Mine as at 16 October 2017

Category	Gross				Net (26.6%)
	Tonnes (millions)	Magnetite %	V2O5 % contained in magnetite	Contained Metal Total V (tonnes)	Tonnes (millions)	Magnetite %	V2O5 % contained in magnetite	Contained Metal Total V (tonnes)
Lower Seam
Probable	26.12	26.79	1.96	137,152	6.95	26.79	1.96	36,482
Total	26.12	26.79	1.96	137,152	6.95	26.79	1.96	36,482

Note: The operator of the mine is Bushveld Vametco Holdings (Pty) Limited.

The above figures assume a cut-off grade of 0.164 V₂O₅ % contained in magnetite.

Competent Persons Statement

The information contained in this press release relating to the Mineral Resource and Mineral Reserves Estimates for the Vametco mine has been prepared under the supervision of Mr Philip Mostert and Jeremy Witley of The MSA Group, Johannesburg South Africa. Messrs Mostert and Witley are registered as Professional Scientists with the South African Council for Professional Natural Scientific Professions (SACNASP) which is a Recognised Professional Organisation (RPO). Messrs Mostert and Witley are employed by MSA and have sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activity which they are undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Mineral Resources" (the "JORC" Code). Messrs Mostert and Witley have reviewed and approved this press release and consents to the inclusion in the announcement of the matters based on their information in the form and context in which this appears

Enquiries: [e-mail]

Bushveld Minerals	[phone]
Fortune Mojapelo, Chief Executive Officer
SP Angel Corporate Finance LLP	[phone]
Nominated Adviser & Broker
Ewan Leggat
Blytheweigh
Financial PR
Tim Blythe / Nick Elwes	[phone]
Gabriella von Ille	[phone]

Notes to editors

Bushveld Minerals is an AIM listed mineral project development company with a portfolio of vanadium and coal assets in Southern Africa, including interest in a vanadium-producing operation and an investment in tin. 

The Company's flagship platform, the vanadium platform, includes the Mokopane Vanadium Project, the Brits Vanadium Project, and an interest in Bushveld Vametco Alloys primary vanadium mining and processing company. The coal platform comprises the wholly-owned Imaloto Coal Project, which is being developed as one of Madagascar's leading independent power producers. The Company's tin interests are held through its shareholding in AIM listed AfriTin Mining Limited.

Bushveld's vision is to become one of the largest low cost integrated primary vanadium producers through owned low-cost high-grade assets. This incorporates development and promotion of the role of vanadium in the growing global energy storage market through Bushveld Energy, the Company's energy storage solutions provider. Whilst the demand for vanadium remains largely anchored in a slow growing steel industry, Bushveld Minerals believes there is a strong potential for imminent significant global vanadium demand surge from the fast-growing energy storage market, particularly through the use and adoption of Vanadium Redox Flow Batteries.

The Company's approach to project development recognises that whilst attractive project economics are imperative, they are insufficient to secure capital to bring them to account. A clear path to production with a visible timeframe, low capex requirements and scalability are important factors in retaining an attractive exit option. This philosophy is core to the Company's strategy in developing projects.

Detailed information on the Company and progress to date can be accessed on the website: www.bushveldminerals.com

Appendix 1 Previous Mineral Resource and Ore Reserve Estimate for the Vametco Mine (as at 31 December 2015)

Table 3 Previous Mineral Resource Estimate for Vametco Mine, 31 December 2015
Mineralised Layer	Resource Category	Tonnage (Mt)	Percentage Magnetics	Percentage V in magnetics	Percentage V2O5 in magnetics	SiO2 (%)	CaO (%)
Upper Seam (US)	Measured	-	-	-	-	-	-
	Indicated	-	-	-	-	-	-
	Measured and Indicated	-	-	-	-	-	-
	Inferred	8.45	23.56	0.59	0.71	1.34	0.31
	Total	8.45	23.56	0.59	0.71	1.34	0.31
Intermediate Seam (IS)	Measured	-	-	-	-	-	-
	Indicated	0.37	28.30	1.69	3.02	1.64	0.33
	Measured and Indicated	0.37	28.30	1.69	3.02	1.64	0.33
	Inferred	19.56	34.12	1.46	2.34	1.64	0.33
	Total	19.94	34.01	1.46	2.35	1.64	0.33
Lower Seam (LS)	Measured	-	-	-	-	-	-
	Indicated	34.80	29.64	1.62	2.48	3.72	0.53
	Measured and Indicated	34.80	29.64	1.62	2.48	3.72	0.53
	Inferred	75.43	29.09	1.50	2.02	3.12	0.52
	Total	110.23	29.26	1.54	2.17	3.31	0.52
Total	Measured	-	-	-	-	-	-
	Indicated	35.17	29.63	1.62	2.49	3.70	0.53
	Measured and Indicated	35.17	29.63	1.62	2.49	3.70	0.53
	Inferred	103.45	29.59	1.42	1.97	2.69	0.47
	Total	138.62	29.60	1.47	2.10	2.95	0.48

Table 4 Previous Ore Reserve Statement for Vametco Mine, 31 December 2015
Mineralised Layer	Reserve Category	Tonnage (Mt)	Percentage Magnetics	Percentage V in magnetics	Percentage V2O5 in magnetics	SiO2 (%)	CaO (%)
Upper Seam (US)	Proved	-	-	-	-	-	-
	Probable	-	-	-	-	-	-
	Total	0	0	-	-	-	-
Intermediate Seams (IS)	Proved	-	-	-	-	-	-
	Probable	0.35	28.41	1.72	3.08	0	0
	Total	0.35	28.41	1.72	3.08	0	0
Lower Seams	Proved	-	-	-	-	-	-
	Probable	26.42	29.78	1.63	2.54	3.61	0.5
	Total	26.42	29.78	1.63	2.54	3.61	0.5
Total	Proved	-	-	-	-	-	-
	Probable	26.77	29.76	1.63	2.55	3.56	0.49
	Total	26.77	29.76	1.63	2.55	3.56	0.49

Appendix 2: DEFINITIONS OF EXPLORATION RESULTS, RESOURCES & RESERVES

EXTRACTED FROM THE JORC CODE: (December 2012) (www.jorc.org)

 A 'Mineral Resource' is a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for 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, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.

An 'Inferred Mineral Resource' is that part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability.

An 'Indicated Mineral Resource' is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed.

A 'Measured Mineral Resource' is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and/or grade continuity.

An 'Ore Reserve' is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified. Ore Reserves are sub-divided in order of increasing confidence into Probable Ore Reserves and Proved Ore Reserves.

 Technical Glossary

Anorthosite	An intrusive igneous rock characterized by a predominance of plagioclase feldspar
Bushveld Complex	A large layered igneous intrusion located in north-eastern South Africa that contains some of the richest ore deposits on Earth.
DTM	Digital Terrain Model: a digital model or 3D representation of the surface of a terrain geological units surface
Disseminated	Scattered or spread, in this case referring to magnetite within anorthosite
Drillhole	A hole drilled in the ground, usually for exploratory purposes
Fault	A fracture or fracture zone, along which displacement of opposing sides has occurred.
FW (foot wall)	The block of rock positioned below a geological unit, mineralised layer or fault
Gabbro	A coarse-grained, dark-colored, intrusive igneous rock composed mainly of the minerals plagioclase and augite (pyroxene).
HW (hanging wall)	The block of rock positioned above a geological unit, mineralised layer or fault
Intermediate Seam	The magnetite-enriched unit at Vametco mine between the Upper Seam and Lower Seam
Lower Seam	The lowermost magnetite-enriched unit at Vametco mine
Mafic intrusion	An igneous intrusion comprising minerals which are iron- or magnesium-rich, and are generally dark in colour
Magnetite	A magnetic iron oxide mineral with the formula Fe3O4
Metallurgical	Relating to the technique or science of separating metals from their ores
Mineralisation	The formation or presence of economically important metals in the rock mass
QAQC	Quality Assurance and Quality Control
Rustenburg Layered Suite	Layered mafic intrusions of the Bushveld Complex
Upper Seam	The uppermost magnetite-enriched unit at Vametco mine

 

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