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MINERAL RESOURCES
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Since the NI 43-101 resource estimate announced in February 2011, Pele completed a 7,000-metre drill program as well as a massive core resampling campaign to increase the sampling range to include the Hanging Wall Zone (“HWZ”) above the Main Conglomerate Bed (“MCB”). As a result of these initiatives, the Indicated and Inferred resources have increased significantly.
The shape of the Resource Wireframe has been changed due to the inclusion of new drilling and the exclusion of historic uranium-focused drill holes where complete assay analysis for REO in the MCB and sampling of the HWZ is not available. However, the MCB was reported as present in every one of the historic drill logs in those areas and at similar thicknesses. A mine life sensitivity analysis that included quantities equivalent to these historically drilled areas showed an increase in mine life to 14 years and NPV (at a 10-percent discount rate) increased by more than $200-million (20-percent) to $1.23-billion.
Mineral resources for Eco Ridge were estimated by RPA, as summarized in Table 3A. Mineral resources are estimated within the MCB and for the new HWZ zone, immediately above the MCB.
Table 3A: Mineral Resource Estimate for Eco Ridge
Zone & Classification |
Tonnes |
U3O8 |
U3O8 |
LREO6 |
HREO7 |
TREO |
TREO |
(‘000s) |
(%) |
(‘000 lbs) |
(ppm) |
(ppm) |
(ppm) |
(‘000 lbs) |
Indicated |
|
|
|
|
|
|
|
MCB |
20,514 |
0.045 |
20,447 |
1,426 |
193 |
1,618 |
73,184 |
HWZ |
28,223 |
0.012 |
7,214 |
733 |
88 |
821 |
51,111 |
Total |
48,737 |
0.026 |
27,661 |
1,025 |
132 |
1,157 |
124,295 |
|
|
|
|
|
|
|
|
Inferred |
|
|
|
|
|
|
|
MCB |
16,906 |
0.043 |
15,940 |
1,279 |
183 |
1,463 |
54,515 |
HWZ |
20,956 |
0.013 |
5,822 |
713 |
95 |
808 |
37,329 |
Total |
37,863 |
0.026 |
21,762 |
966 |
134 |
1,100 |
91,843 |
Notes:
- CIM definitions were followed for Mineral Resources.
- The Qualified Person for this Mineral Resource estimate is Tudorel Ciuculescu, P.Geo.
- Mineral Resources are estimated at a cut-off value of $100 per tonne for the MCB, and $50 per tonne for the HWZ. Values were calculated based on prices and recoveries of uranium and rare earths, net of off-site rare earth separation costs.
- Mineral Resources are estimated using an average long-term uranium price of US$70 per lb U3O8, a rare earth "basket price" of $78 per kg (net of separation charges), and a C$:US$ exchange rate of 1.00:1.00.
- A minimum mining thickness of 1.8 metres was used.
- Light Rare Earth Oxides include La2O3, CeO2, Pr6O11, and Nd2O3.
- Heavy Rare Earth Oxides include Sm2O3, Eu2O3, Gd2O3, Tb4O7, Dy2O3, Ho2O3, Er2O3, Tm2O3, Yb2O3, Y2O3, and Lu2O3. Sc2O3 is also included in HREO, as it occurs in low concentrations and carries high unit values like an HREO.
Table 3B: Mineral Resource Grade (Individual REO) for Eco-Ridge
|
Indicated |
Inferred |
Individual REO |
MCB
(ppm) |
HWZ
(ppm) |
MCB
(ppm) |
HWZ
(ppm) |
La2O3 |
386 |
200 |
346 |
194 |
CeO2 |
731 |
376 |
657 |
365 |
Pr6O11 |
73 |
37 |
66 |
37 |
Nd2O3 |
235 |
120 |
212 |
117 |
Sm2O3 |
40 |
20 |
37 |
20 |
Eu2O3 |
2 |
1 |
2 |
1 |
Gd2O3 |
27 |
12 |
25 |
13 |
Tb4O7 |
4 |
2 |
4 |
2 |
Dy2O3 |
17 |
7 |
16 |
8 |
Ho2O3 |
3 |
1 |
3 |
1 |
Er2O3 |
7 |
3 |
7 |
3 |
Tm2O3 |
1.0 |
0.4 |
0.9 |
0.4 |
Yb2O3 |
6 |
2 |
5 |
3 |
Lu2O3 |
0.8 |
0.3 |
0.7 |
0.4 |
Y2O3 |
79 |
35 |
74 |
38 |
Sc2O3 |
6 |
5 |
9 |
6 |
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|
|
|
Light REO6 |
1,426 |
733 |
1,280 |
713 |
Heavy REO7 |
193 |
88 |
183 |
95 |
|
|
|
|
|
Total REO |
1,618 |
821 |
1,463 |
808 |
Notes:
- CIM definitions were followed for Mineral Resources.
- The Qualified Person for this Mineral Resource estimate is Tudorel Ciuculescu, P.Geo.
- Mineral Resources are estimated at a cut-off value of $100 per tonne for the MCB, and $50 per tonne for the HWZ. Values were calculated based on prices and recoveries of uranium and rare earths, net of off-site rare earth separation costs.
- Mineral Resources are estimated using an average long-term uranium price of US$70 per lb U3O8, a rare earth "basket price" of $78 per kg (net of separation charges), and a C$:US$ exchange rate of 1.00:1.00.
- A minimum mining thickness of 1.8 metres was used.
- Light Rare Earth Oxides include La2O3, CeO2, Pr6O11, and Nd2O3.
- Heavy Rare Earth Oxides include Sm2O3, Eu2O3, Gd2O3, Tb4O7, Dy2O3, Ho2O3, Er2O3, Tm2O3, Yb2O3, Y2O3, and Lu2O3. Sc2O3 is also included in HREO, as it occurs in low concentrations and carries high unit values like an HREO.
The mineral resources at Eco Ridge have excellent potential for upgrade and expansion, with lower-than-normal exploration risk in the historically drilled areas. The mineralized reefs of the Elliot Lake mining camp are well known for their consistency and size and, to-date, Pele has a 100-percent success rate in upgrading Inferred resources to Indicated resources in the MCB at Eco Ridge. There is also excellent potential to add substantial new mineral resources in areas beyond the Resource Wireframe where the deposit remains open down dip beyond the historically drilled areas.
Note: The PEA is preliminary in nature. It includes inferred mineral resources, which are considered too speculative geologically to have the economic considerations applied to them that would enable their categorization as mineral reserves. There is no certainty that the PEA forecast will be realized.
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