TIDMGLR
RNS Number : 0869T
Galileo Resources PLC
10 December 2012
10 December 2012
Galileo Resources Plc
("Galileo" or the "Company")
Glenover Rare Earth Project - Preliminary Economic Assessment
Update
The Board of Galileo Resources Plc (AIM: GLR), the emerging
African Rare Earth exploration and development company, reports
positive and significant progress on the Preliminary Economic
Assessment (PEA) of its Glenover Rare Earth Project in South
Africa, a joint venture with Glenover Phosphate (Pty) Ltd
("Glenover").
As part of the PEA, Galileo through Glenover, and lead contactor
GBM Minerals Engineering Consultants Limited ("GBM"), commissioned
independent and recognised resource industry consultants to
undertake a review of Glenover's resource estimate (announced 17
April 2012), to generate PEA confidence level mine design including
pit optimization and financial modelling, as well as an
environmental study; the initial results of these reports are now
available.
PEA Progress - Significant Highlights:
-- The Glenover Resource Statement (announced April 2012) has
been independently reviewed ('the Review") including data on the
Rare Earth Oxide (REO) distribution applicable to the Resource
Estimate (see Rare Earth Oxide Ratios table herein)*
-- The relative density (RD) of surface stockpiles and their
volumes were retested and redefined respectively, the net effect of
which increased by 8 % the reported Inferred stockpile resource to
a gross amount of 2.940 million tonnes from 2.723 million tonnes
reported in the Glenover Carbonatite Geological and Resource Report
- August 2012
-- The mining geotechnical report was completed indicating
strong wall rock competency characteristics
-- The open pit planning determined a low stripping ratio of 1.5 to 1 (tonnes to tonnes)
-- An enviromental study was completed which showed no fatal flaws in this area
-- Extensive metallurgical testwork is being carried out and the
results to date suggest that a high grade marketable REO product
can be produced
-- Engineering, costing and marketing studies are progressing to schedule
-- Completion of the PEA is anticipated in early Q1 2013
* The Resource was compiled by GeoConsult International and the
Competent Person is Mr Pete Siegfried with professional
registration with MAusIMM. The total tonnage for the in-situ
material is 26.243 Mt (Indicated & Inferred).
Colin Bird, Executive Chairman of Galileo Resources, said: "We
are particularly pleased with the potential increase in tonnage of
the stockpiles and that the open pit design is not adversely
affected by potential poor rock stability. So far, all of the
fundamentals that 'make or break' the outcome of this important PEA
are particularly positive and we look forward to the completion of
the PEA in the New Year."
Mineral Resource Review
The resource covers in-situ material comprising apatite breccia,
carbonatite and pyroxenite as well as the stockpiles related to the
historical mining activities by Gold Fields SA between 1963 and
1984.
The Review redefined the volume of each stockpile using wire
frames compiled from topographic data provided by Glenover. The
recalculated volume of 1.277 Mm(3) is 5 % lower than the previous
estimate of 1.348 Mm(3) . A re-assessment of the relative density
(RD) of the stockpiles was carried out using the nuclear Troxler
method. An average RD of 2.30 t/m(3) was determined which is 14 %
higher than the value of 2.02 t/m(3) used in the original resource
estimate. This higher RD value is consistent with historical
reported values and consequently was deemed the most appropriate
value for the Review.
The net effect of the re-assessed volume and RD values is an 8 %
increase in the stockpile tonnage to 2.94 million tonnes from 2.732
million tonnes.
The Review confirmed The South African Code for the Reporting of
Exploration Results, Mineral Resources and Mineral Reserves ("the
SAMREC Code") classification of the resource in the stockpiles to
be of Inferred category for reasons that included: moderate
confidence in the volumes of each stockpile; moderate confidence in
the RD values for each stockpile; the origin of the material is
inferred from geological evidence and sampling, but not verified
geologically or through analysis of grade continuity; and the
limitations in scope and reliability of the assay data for the
stockpiles.
Preliminary mining studies have indicated that within the
current economic environment, the stockpiles will be processed. A
zero cut-off was used for the stockpiles based on the fact that all
the material contained within the stockpiles is likely to be
processed.
Based on this modelling the Inferred Mineral Resource of the
total eight stockpiles following the Review is as follows:
Inferred Mineral Resource - Stockpiles August 2012
Stockpiles RD Tonnes Net TREO P(2) O(5) TREO Net TREO P(2) O(5) Net P(2) 0(5)
(t/m(3) ) (Mt) Tonnes (%) (%) Content Content Content Content
(Mt) (Mt) (Mt) (Mt) (Mt)
------------ ----------- ------- -------- ----- ---------- --------- --------- ---------- --------------
Total 2.30 2.940 1.301 2.08 23.71 0.061 0.027 0.697 0.308
------------ ----------- ------- -------- ----- ---------- --------- --------- ---------- --------------
Note: Net means attributable amounts based on Galileo's option
to acquire up to 44.24 % in the Glenover Joint Venture project by
proving funding of up to $7million.
Distribution of Rare Earth Oxides
In the Review, geostatistical assessments were made for eight of
the more significant REO (La, Ce, Pr, Nd, Eu, Dy, Tb, Y) to assess
whether average distributions for these key elements can be applied
to estimated TREO grades to provide the distribution of individual
REOs in the estimated grades for each rock type.
The analysis showed strongly normal and narrow distributions for
the REOs and very similar REO distributions for each rock type
domain, implying a constant geochemical signature and that the
distribution in the main is not affected by the REO grade. The
relative contribution of all 15 REOs was calculated for each of the
rock types contributing to the resource estimate and are summarised
in the table below.
Rare Earth Apatite Carbonatite Pyroxenite Stockpiles
Oxide Breccia % % %
%
------------ -------- ----------- ---------- ----------
La(2) O(3) 16.17 16.94 15.87 19.04
------------ -------- ----------- ---------- ----------
CeO(2) 44.62 45.77 44.78 45.61
------------ -------- ----------- ---------- ----------
Pr(6) O(11) 5.89 5.85 5.83 5.26
------------ -------- ----------- ---------- ----------
Nd(2) O(3) 22.49 21.87 22.48 20.98
------------ -------- ----------- ---------- ----------
Sm(2) O(3) 3.66 3.41 3.62 3.02
------------ -------- ----------- ---------- ----------
Eu(2) O(3) 0.93 0.87 0.92 0.74
------------ -------- ----------- ---------- ----------
Gd(2) O(3) 2.14 1.94 2.13 1.67
------------ -------- ----------- ---------- ----------
Tb(4) O(7) 0.22 0.19 0.22 0.17
------------ -------- ----------- ---------- ----------
Dy(2) O(3) 0.81 0.68 0.86 0.65
------------ -------- ----------- ---------- ----------
Ho(2) O(3) 0.11 0.09 0.12 0.09
------------ -------- ----------- ---------- ----------
Er(2) O(3) 0.20 0.16 0.22 0.17
------------ -------- ----------- ---------- ----------
Tm(2) O(3) 0.02 0.02 0.02 0.02
------------ -------- ----------- ---------- ----------
Yb(2) O(3) 0.09 0.08 0.10 0.09
------------ -------- ----------- ---------- ----------
Lu(2) O(3) 0.01 0.01 0.01 0.01
------------ -------- ----------- ---------- ----------
Y(2) O(3) 2.64 2.12 2.82 2.30
------------ -------- ----------- ---------- ----------
Source: Glenover Carbonatite Geological and Resource Report -
August 2012
The Company intends to undertake more detailed analysis as part
of a pre-feasibility study and to test these values through a full
geostatistical analysis of the individual elements. Further
drilling to add more definition to the ore body as well as drilling
of the stockpiles will occur.
Based on the reviews undertaken on the Glenover Mineral
Resources for the in-situ (hard rock) mineralization dated 17 April
2012, the Review concluded inter alia that:
-- the quoted resource figures of tonnage and grade are valid
and representative of the data from which they derived;
-- the criteria used for the resource estimate in the
determination of the confidence levels of Indicated and Inferred
in-situ Mineral Resources has taken into account the confidence in
tonnage/grade computations, density, quality, value and
distribution of primary data and information and the geological and
mineralization models; and
-- the work undertaken and the modelling suggest that the
geological, sample, survey and density data for the project used by
Glenover is reliable for use in resource estimation work and that
no significant bias in this data exists that materially affects the
quality of the resource estimates that rely on these data.
Geotechnical and Mine Design
The aim of the geotechnical and mine design was to assess the
current Glenover open cast pit potential based on previous
geotechnical design criteria/parameters and to re-evaluate design
criteria / parameters to a potential mining depth of +/-155 metres
(m).
The basic mining rock types that comprise the ore body are
described in the table below.
Basic Mining Rock Types
Rock Type Description
---------------- --------------------------------------------------------------------------------------
Soil / Calcrete Weathered residual reddish soil (thickness < 3m).
---------------- --------------------------------------------------------------------------------------
Saprolite Saprolite at various levels of weathering (thickness < 5m).
---------------- --------------------------------------------------------------------------------------
Hard Rock Biotite - pyroxenite / carbonatite / apatite - haematite - breccia (thickness +120m).
---------------- --------------------------------------------------------------------------------------
For the soft / saprolite rocks and soils, the investigation
determined stable bench angles of 65(deg) using the Hoek and Bray
design charts.
Stable bench stack heights of 60 m and bench stack angle of
62deg for the hard rock were determined using Haines and Terbrugge
charts.
The use of slide modeling determined a Factor of Safety of +2
and a Probability of Failure of 0 % for deep seated failures (based
on the mechanical properties of the rock), which implies that the
likelihood of a large rock mass failure (slope collapse) in the
high walls of the open cast pit is very low.
A geotechnical programme has been recommended in order to design
the Glenover open pit according to international geotechnical
design criteria for pre-feasibility and feasibility study
standards.
A first-pass design for the open pit mine was completed as part
of the pit optimization using a stripping ratio of 1.5 to 1.0.
Environmental
The main aims of the preliminary assessment of environmental
matters for the Project were to identify any possible fatal flaws
and to develop terms of reference (ToR) for a pre-feasibility study
and a full feasibility study including an Environmental Impact
Assessment (EIA), required to obtain the relevant environmental
authorisations.
The environmental assessment scope of work included, inter alia,
assessment of the general environmental conditions of the project
area, existing environmental and mining authorisations associated
with the existing license area and fatal flaw analysis including an
Environmental Legal Due Diligence.
In terms of environmental and social information available, the
environmental report did not indentify any fatal flaws that would
prevent the project to proceed into a feasibility phase. The risks
identified in the Report can be mitigated during the feasibility
phase, should the project proceed.
Metallurgical Testwork and Process
The Company, through Fer-Min-Ore, its JV partner in Glenover,
commissioned Maelgwyn Minerals in South Africa to undertake initial
metallurgical test work on stockpile samples with the objectives
being to recover the REEs and the phosphate (apatite) to a saleable
product. A grade of >30 % P(2) O(5) and <2 % Fe (iron) - the
general iron specification for marketing phosphates- was to be
achieved, primarily by direct flotation. This test work was
completed and a report issued in October 2012.
The test work achieved phosphate flotation concentrates assaying
up to 33.0 % P(2) O(5) with 3.8 % Fe at P(2) O(5) recovery of 56 %
by rougher flotation at elevated temperature (60 (o) C) and
alkaline pH with depressant reagents followed by five stages of
cleaner flotation. After four stages of cleaning the flotation
concentrate assayed 31.6 %, still greater than the targeted 30 %
P(2) O(5) , at a P(2) O(5) recovery of 67 %. However, the Fe
content of this fourth cleaner concentrate increased to 4.6 % Fe.
Magnetic separation and multi gravity separation on this
concentrate to remove iron was not able to reduce the total iron
assay to <2 % Fe. A nitric acid leach of the concentrates
solubilized 70 % of the P(2) O(5) and approximately 50 % of the Fe,
a result that indicated the phosphate concentrate could meet the
iron specification since the soluble Fe in the product, which is
the critical criterion, would be around 2 %.
Following a review of this initial test work, Glenover
commissioned two laboratories, Anzaplan Dorfner in Germany and
GRINM in China, to undertake comprehensive metallurgical test work
comprising further beneficiation, hydrometallurgy on the
beneficiation products and hydrometallurgy on run-of mine (ROM)
material to produce high grade marketable REE product or products.
Both laboratories have rare earth beneficiation expertise, while
the Chinese laboratory also has considerable expertise in
processing rare earth concentrate to marketable products.
Preliminary results from Anzaplan, testing a physical processing
option - comminution and magnetic separation followed by flotation
of the phosphate from the non magnetic product - achieved a
potentially saleable apatite concentrate of >30 % P(2) O(5) with
modest P2O5 recovery and some 11 % of the rare earth elements
(REEs) reporting to the P(2) O(5) concentrate. Beneficiation tests
on the iron-rich magnetics and phosphate flotation tailings to
recover the balance of the REEs showed modest separation of REEs
from Fe minerals even at relatively fine regrinding.
Alternative hydrometallurgical processing options are being
tested including acid or caustic cracking (leaching) on the
aforementioned magnetics and tailings, as well as on ROM material.
Results are highly encouraging, sulphuric acid cracking producing
high recovery of the REEs into solution, from which an REE product
assaying 43 % REE was effectively precipitated, free of significant
Ca, Fe, Mg or Na contamination. These tests are on going.
For further information, please contact:
Colin Bird, Chairman & CEO Tel +44 (0)20 7581 4477
Andrew Sarosi, Executive Director Tel +44 (0) 1752 221937
Beaumont Cornish Limited Tel +44 (0)20 7628 3396
Nominated Advisor and Broker
Roland Cornish/James Biddle
Shore Capital Stockbrokers Limited Tel +44 (0)20 7408 4090
Joint Broker
Jerry Keen/Toby Gibbs
Gable Communications Tel +44 (0) 7193 7463
Justine James M +44 (0) 7525 324431
A copy of the announcement is available on the Company's website
www.galileoresources.com
Technical Sign-Off
Andrew Sarosi, Technical Director of Galileo, who holds a B.Sc.
Metallurgy and M.Sc. Engineering, University of Witwatersrand and
is a member of The Institute of Materials, Minerals and Mining, is
a 'qualified person' as defined under the AIM Rules for Companies
and a competent person under the reporting standards. The technical
parts of this announcement have been prepared under Andrew Sarosi's
supervision and he has approved the release of this
announcement.
Notes
Galileo Resources Plc is a natural resource exploration company.
The Company has an experienced management team with proven
technical and commercial background. The flagship property is the
Glenover Phosphate concession, which produced phosphate for many
years. Phosphate however, is now subordinated to Rare Earth
Elements ("REEs"). The project area is known to contain REEs and
that the grades, if of sufficient size and continuity may well lead
to a medium-sized operation for the production of REOs.
Galileo Resources currently has a 31.66% interest in the
Glenover Project and has the option, via additional stage payments
as set out in the Company's Admission Document, to earn up to a
maximum interest of 73.73%.
One of the key benefits of the project for a medium-sized
operation is that, if REEs, which have been shown to be present in
the stockpiles from the previous phosphate operations, can be
proven to compliant resource category, the cost of mining it and
the associated risks should substantially be reduced.
The concession is of considerable size and hosts mineralisation
types suitable for potential REE presence. The aim is to
investigate the mineralisation types for REE presence and content
with the view to proving up a mineable resource of REOs.
Technical Glossary
Phosphate (P(2) O(5) ): An oxide of phosphorus
REE (rare earths element): A set of fifteen chemical elements in
the periodic table specifically the lanthanides (plus yttrium ad
hoc and scandium) and by convention categorised as light REE (the
first seven elements plus yttrium) and heavy REE (the other eight
lanthanides)
REO (rare earth oxide): The oxide form of the rare earth elements
TREO: Total rare earth oxides
The rare earth elements in the Glenover deposit:
Ce: Cerium Uses include cathode ray tube glass to prevent age
discoloration, in auto catalytic converters, rich red colour
pigments, low energy light bulbs, film studio carbon-arc lighting
and minor use in self cleaning ovens
Dy: Dysprosium Uses include halide discharge lamps for intense
light, permanent magnets and in nuclear industry as cermet
(composite of ceramic and sintered material)
Eu: Europium Uses include bright red coloration in television
tubes; industrial street lighting to give a more natural light,
thin film superconductor alloys and in lasers
Gd: Gadolinium Uses include neutron capture capability and in
compounds as a contrasting agent in radiography and magnetic
resonance imaging in medical diagnostics
La: Lanthanum Uses include carbon-arc lighting, additive to
glass for lenses and new treatment for bone disease
(osteodysrophy). Potential use for hydrogen (H) storage for
H-fuelled vehicles: being able to absorb hydrogen as much as 400
times its volume
Lu: Lutetium Uses mainly for research and in tiny amounts in
magnetic bubble memory devices
Nd: Neodymium Uses include alloyed with iron and boron to make
one the most powerul permanent magnets known (see also Samarium
below) and found in modern vehicles using motorised devices; in
welders protective glasses and power lasers
Pr: Praseodymium Uses include as an additive to give glass a
pure yellow colour and brilliant pastel greens and yellows for
glazes
Sm: Samarium Uses include alloyed with cobalt to produce
permanent magnets ten thousand times more powerful than iron and
has the highest resistance to demagnetization; in masers (microwave
lasers) capable of cutting steel and bouncing off the surface of
the moon
Tb: Terbium Uses include lasers, low energy light bulbs and
mercury lamps and improving safety in x-ray diagnosis
Y: Yttrium Uses include lasers, as host for europium in TV red
phosphor, alloyed with boron and cobalt high temperature
superconductors and microwave filters
This information is provided by RNS
The company news service from the London Stock Exchange
END
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