Lithium Resource Increase and Upgrade

RNS Number : 7746I

Rare Earth Minerals PLC

04 June 2014

 



4 June 2014

Rare Earth Minerals Plc.

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

Lithium Resource Increase and Upgrade - Sonora Lithium Project

Rare Earth Minerals Plc (LSE AIM: REM)) is pleased to announce that the Mineral Resource for the Sonora Lithium Project in northern Mexico has increased by 37% to a new total of 3.28 million tonnes of Lithium Carbonate Equivalent ("LCE") and have been upgraded from the Inferred to Indicated category.

The Mineral Resource update for the El Sauz / Fleur joint venture lands and the La Ventana deposit ("the Sonora Lithium Project") have been provided by Bacanora Minerals Ltd ("Bacanora"), the Company's joint venture partner in El Sauz and Fleur and the owner of the La Ventana Deposit. . The full news release from Bacanora is shown below.

Highlights:

·     El Sauz and Fleur and contained LCE increases by 35% to 2.01 million tonnes.

·     La Ventana contained LCE increased by 37% to 1.273 million tonnes

·     Indicated total Lithium Resources for El Sauz and Fleur total 120,990,000 tonnes averaging 3,120 ppm Li (1.66% LCE) for combined Upper and Lower Clay units at a cut-off of 2,000 ppm Li.

·     Indicated total Lithium Resources for La Ventana are 75,320,000 tonnes averaging 3,174 ppm Li (1.66%) for the combined Upper and Lower Clay units at a cut-off of 2,000 ppm Li.

·     Work on the large, 96,964 hectare, concession package that form the lands under the second joint venture with Bacanora is progressing well. To date four drill holes have been completed, mapping and surface sampling are ongoing. First results are expected towards the end of June 2014.

David Lenigas, the Company's Chairman commented:

"This announcement of a significant increase and upgrade in resource is an important milestone in the development of the Sonora Lithium Project.

These results combined with the previous announcements on the achievement of 99.5% battery grade product, the production of lithium carbonate samples for potential buyers and the commissioning of a scoping study for a 35,000 to 50,000 tonne per year lithium carbonate plant shows that the development of the Sonora Lithium Project is progressing well and has the potential to become a significant global lithium producer"

REM's interest in the Sonora Lithium Project consist of a 10.18% direct interest in Bacanora a 30% in the Bacanora subsidiary that owns the El Sauz / Fleur Lands and a 10% in the Bacanorasubsidiary that owns the Megalit Lands. When aggregated the total economic interests are 10.19% in La Ventana, 37.12% in the El Sauz / Fleur Lands and 19.16% in the Megalit Lands.

El Sauz and Fleur Concessions Resource Update

The total indicated mineral resources, using a base case cut-off of 2,000 ppm lithium, are 120,990,000 tonnes averaging 3,120 ppm Li (1.66% LCE¹) for the combined Upper and Lower Clay units. The Upper Clay has an indicated Li resource of 47,360,000 tonnes averaging 2,222 ppm Li (1.18% LCE). The Lower Clay has an indicated resource of 73,630,000 tonnes averaging 3,698 ppm Li (1.97% LCE).  The Company's share of the LCE resource therefore stands at 168,000 tonnes and 435,000 tonnes for the Upper and Lower Clay respectively, for a combined LCE resource of 603,000 tonnes. Table 1 summarizes the updated and reclassified lithium resources for the El Sauz and Fleur concessions, which are subject to a joint venture with Bacanora.

The tonnage for the combined clay units has increased by 37% and the LCE tonnage has increased by 36% over the previous estimate (refer to press release dated August 28, 2013).

The updated lithium resource estimate is based on results from an additional 31 drill holes, for a total of 41, and a total of 1,559 sample analyses for the El Sauz and Fleur concessions. Furthermore, the updated resources are reclassified as "indicated mineral resources" based on geological and grade continuity of the lithium-bearing clay horizons and in accordance with CIM Definition Standards On Mineral Resources and Mineral Reserves.

¹ LCE = lithium carbonate (Li₂CO₃) equivalent; determined by multiplying Li value in percent by 5.324 to get an equivalent Li₂CO₃ value in percent. Use of LCE is to provide data comparable with industry standards.

Table 1. El Sauz and Fleur Indicated Lithium Resources

Cut-off	Tonnes	Tonnes attributable to REM @30%	Li ppm	LCE %	LCE tonnes	LCE tonnes attributable to REM @30%
Upper Clay
1000	97,080,000	29,124,000	1,657	0.88	856,000	257,000
2000	47,360,000	14,208,000	2,222	1.18	560,000	168,000
3000	18,390,000	5,517,000	3,773	2.01	369,000	111,000
Lower Clay
1000	98,250,000	29,475,000	3,028	1.61	1,584,000	475,000
2000	73,630,000	22,089,000	3,698	1.97	1,450,000	435,000
3000	58,910,000	17,673,000	4,140	2.20	1,298,000	389,000
Total for Upper & Lower Clay
1000	195,330,000	58,599,000	2,347	1.25	2,440,000	732,000
2000	120,990,000	36,297,000	3,120	1.66	2,010,000	603,000
3000	77,300,000	23,190,000	4,053	2.15	1,667,000	500,000

Megalit, Buenavista and San Gabriel Concessions Update:

Work on the large, 96,964 hectare, concession package that form the lands under the second joint venture between Bacanora and REM is progressing well. To date, four drill holes have been completed with mapping and surface sampling ongoing. The Company still needs to split and log the core, which will be followed by shipping to the laboratory for analysis in the coming weeks. Results from the laboratory are expected to be received by roughly late June and will be released following compilation by the Company. In the event that any material information or results are obtained prior to such time, the Company will update the market accordingly.

About REM's interests in the Sonora Lithium Project:

REM has a 30% interest in the Bacanora subsidiary that owns the contiguous El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 concessions (the "El Sauz / Fleur lands") under joint venture with Bacanora. The resource on the El Sauz / Fleur Lands is open down dip to the east and to the southwest. For further details concerning the Company's first agreement with Bacanora and details of the joint venture, please refer to the Company's press release dated May 22, 2013. REM has a 10% interest in the Bacanora subsidiary that will hold the Buenavista, Megalit and San Gabriel concessions which are subject to an agreement (the "Megalit Lands") with Bacanora in which REM has rights to acquire up to a 30% interest - for details on this agreement please refer the Company's press release dated March 13, 2014.

REM has a 10.18% of Bacanora where indicated resources have also been estimated for the La Ventana Lithium Deposit totalling 75 million tonnes, averaging 3,698 ppm Li (equivalent to 1.6% lithium carbonate equivalent assuming 100% recovery and no process losses).

Qualified Person's Statement:

Information in this announcement relates to information compiled by Carl G Verley, P.Geo, a consultant to the Company, who is a member of the Association of Professional Engineers and Geoscientists of British Columbia and is a Qualified Person with respect to the information disclosed herein.

- Ends -

For further information please contact: 

Rare Earth Minerals plc                                                                   [phone]

David Lenigas

Kiran Morzaria

WH Ireland Limited (NOMAD & Joint Broker)                               [phone]

James Joyce

Nick Field

Hume Capital plc (Joint Broker)                                                     [phone]

Guy Peters

Jon Belliss

Square1 Consulting

David Bick                                                                                          [phone]

Mark Longson

Bacanora Minerals Ltd's News Release date 3 June, 2014:

Calgary, Alberta, Canada June 3, 2014

NEWS Release

BACANORA ANNOUNCES A 37% INCREASE IN LITHIUM RESOURCES TO 3.28 MILLION TONNES OF LCE² AND AN UPGRADE OF RESOURCES FROM INFERRED TO INDICATED FOR THE SONORA LITHIUM PROJECT, MEXICO

BACANORA MINERALS LTD.("Bacanora" or the "Company") is pleased to announce that it has updated the lithium resources for both its 100% owned La Ventana lithium deposit and the El Sauz and Fleur concessions which are held by Mexilit S.A. de C.V. ("Mexilit").  Mexilit is owned 70% by Bacanora and 30% by Rare Earth Minerals PLC ("REM") (AIM: REM).

La Ventana Lithium Deposit:

The new indicated mineral resources, using a base case cut-off of 2,000 ppm lithium, are 75,320,000 tonnes averaging 3,174 ppm Li (1,273,000 tonnes of LCE) for the combined Upper and Lower Clay Units.  This is an increase of 37% over the previously announced resource of 930,000 tonnes of LCE³.  The indicated Li resource for the Upper Clay unit is estimated at 21,470,000 tonnes averaging 2,256 ppm Li (1.20% LCE). The Lower Clay Unit has an indicated Li resource estimated at 53,850,000 tonnes averaging 3,540 ppm (1.88% LCE). Investors are cautioned that the resource estimate does not mean or imply that an economic lithium deposit exists on La Ventana.  Further testing will need to be undertaken to confirm economic feasibility.  Table 1 below summarizes the updated and reclassified lithium resources for the La Ventana lithium deposit.

El Sauz and Fleur Concessions (Joint Venture #1 Lands):

Table 2 summarizes the updated and reclassified lithium resources for the El Sauz and Fleur concessions on a 100% basis. The indicated mineral resources, using a base case cut-off of 2,000 ppm lithium, are 120,990,000 tonnes averaging 3,120 ppm Li (2,010,000 tonnes of LCE) for the combined Upper and Lower Clay units. This is an increase of 35%over the previously announced resource of 1,486,000 tonnes of LCE⁴. The Upper Clay has an indicated Li resource of 47,360,000 tonnes averaging 2,222 ppm Li (1.18% LCE).  The Lower Clay has an indicated resource of 73,630,000 tonnes averaging 3,698 ppm Li (1.97% LCE).  Investors are cautioned that the resource estimate does not mean or imply that an economic lithium deposit exists on the El Sauz and Fleur concessions. Further testing will need to be undertaken to confirm economic feasibility. 

When combined, the La Ventana, El Sauz and Fleur deposits are estimated to host an indicated lithium resource of 196,310,000 tonnes averaging 3,130 ppm Li (1.67% LCE) or 3,283,000 tonnes LCE.

The updated lithium resource estimates are based on results from an additional 6 drill holes (for  a total of 17 holes) and 6 trenches and a total of 590 samples for La Ventana and an additional 31 drill holes (for a total of 41) and a total of 1,559 samples for the El Sauz and Fleur concessions. Furthermore, the updated resources are reclassified as "indicated mineral resources" based on geological and grade continuity of the lithium-bearing clay horizons and in accordance with CIM Definition Standards On Mineral Resources and Mineral Reserves. In compliance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"), the Company will prepare a technical report in respect of this updated resource estimate, which will be filed on SEDAR within 45 days from today.

² LCE = lithium carbonate (Li₂CO₃) equivalent; determined by multiplying Li value in percent by 5.324 to get an equivalent Li₂CO₃ value in percent. Use of LCE is to provide data comparable with industry reports and assumes complete conversion of lithium in clays with no recovery or process losses.

³ For reference to the Company's previously announced resource estimate on the La Ventana concession, please refer to the Company's news releases dated September 5, 2012 and January 25, 2013, together with the Company's technical report dated September 5, 2012 and its Preliminary Economic Assessment dated January 24, 2013.
⁴ For reference to the Company's previously announced resource estimate on the El Sauz and Fleur concessions, please refer to the Company's news release dated August 28, 2013, together with the Company's technical report dated October 11, 2013. 
 

Table 1. La Ventana Indicated Lithium Resources

Cut-off	Tonnes	Li ppm	LCE %	LCE tonnes
Upper Clay
1,000	30,690,000	1,824	0.97	298,000
2,000	21,470,000	2,256	1.20	258,000
3,000	10,030,000	3,186	1.70	170,000
Lower Clay
1,000	61,050,000	3,247	1.73	1,055,000
2,000	53,850,000	3,540	1.88	1,015,000
3,000	38,180,000	4,510	2.40	917,000
Total for Upper & Lower Clay
1,000	91,740,000	2,771	1.48	1,353,000
2,000	75,320,000	3,174	1.69	1,273,000
3,000	48,210,000	4,235	2.25	1,087,000

Table 2. El Sauz and Fleur Indicated Lithium Resources

Cut-off	Tonnes	Li ppm	LCE %	LCE tonnes
Upper Clay
1000	97,080,000	1,657	0.88	856,000
2000	47,360,000	2,222	1.18	560,000
3000	18,390,000	3,773	2.01	369,000
Lower Clay
1000	98,250,000	3,028	1.61	1,584,000
2000	73,630,000	3,698	1.97	1,450,000
3000	58,910,000	4,140	2.20	1,298,000
Total for Upper & Lower Clay
1000	195,330,000	2,347	1.25	2,440,000
2000	120,990,000	3,120	1.66	2,010,000
3000	77,300,000	4,053	2.15	1,667,000

Megalit, Buenavista and San Gabriel Concessions (Joint Venture #2 Lands) Update:

Work on the large, 96,964 hectare, concession package that form the lands under the second joint venture with REM is progressing well. To date, four drill holes have been completed with mapping and surface sampling ongoing. The Company still needs to split and log the core, which will be followed by shipping to the laboratory for analysis in the coming weeks.  Results from the laboratory are expected to be received by roughly late June and will be released following compilation by the Company.  In the event that any material information or results are obtained prior to such time, the Company will update the market accordingly.

Martin Vidal, President of Bacanora, commented "We are very pleased with the recent drill and trench results from the Sonora Lithium Project, which support the reclassification of the lithium resources, as well as the continuing expansion of known lithium resources."

Carl G. Verley, P.Geo. is the Qualified Person pursuant to NI 43-101 that has reviewed and approved the technical contents of this news release.

About the Sonora Lithium Project:

The Sonora Lithium Project consists of ten contiguous concessions covering 104,064 hectares. Two of the concessions (La Ventana and La Ventana 1) are owned 100% by Bacanora. The El Sauz, El Sauz 1, El Sauz 2, Fleur and Fleur 1 concessions (the "Joint Venture #1 Lands") are owned 70% by Bacanora and 30% by REM under Joint Venture #1.  The San Gabriel, Buenavista and Megalit concessions (the "Joint Venture #2 Lands") are owned 90% by Bacanora and 10% by REM under Joint Venture #2⁵. The Company has declared indicated resources on each of the La Ventana concessions and the Joint Venture #1 Lands, in respect of which reports have been prepared in accordance with NI 43-101 (please refer to the Company's SEDAR filings for copies of these reports and related press releases). The resource on the Joint Venture #1 Lands is open down dip to the east and to the west. For further details concerning the Company's first agreement with REM and details of Joint Venture #1, please refer to the Company's press release dated May 22, 2013. For further details concerning the Company's second agreement with REM and details of Joint Venture #2, please refer to the Company's press releases dated March 12 and March 26, 2014. Bacanora has developed a process for recovering lithium from the clays and converting it into battery grade⁶ lithium carbonate (please refer to Bacanora's news release dated April 22, 2014).

⁵ As noted in Bacanora's news release dated May 26, 2014, REM has provided written notice of the exercise its second stage option in respect of Joint Venture #2, confirming its desire to increase its ownership therein from 10% to 30% and has delivered a payment of US$500,000 in connection therewith. In the event that REM provides an additional US$1 million prior to November 26, 2014 (which is to be used for exploration and drilling expenditures over the following year), REM shall have fulfilled its conditions of exercise.

⁶ It is industry standard terminology that "battery grade" lithium carbonate is lithium carbonate product with over 99.5% lithium carbonate purity. Battery-grade lithium carbonate is employed by the battery industry in the production of lithium ion batteries, which are used in a variety of applications, from small consumer and industrial appliances to electric vehicles and large stationary energy storage facilities for electric utilities.

 

 

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