Rare Earth Minerals PLC Increase in Indicated Resource at Cinovec (2472X)

TIDMREM

RNS Number : 2472X

Rare Earth Minerals PLC

20 February 2017

Rare Earth Minerals Plc

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

Drill Programme Completed at the Cinovec Lithium Project

Rare Earth Mineral Plc (AIM/ISDX: REM; OTC: REMMY) is pleased to report that European Metals Holdings Limited ("EMH") announced on the 17 February a substantial upgrade of its JORC compliant Indicated Mineral Resource at the Cinovec Lithium/Tin Project in the Czech Republic, confirming its status as the largest Lithium resource in Europe

EMH recently completed an extensive seven-month drilling campaign at Cinovec, consisting of 17 holes for 6,081 meters designed to increase the confidence in the resource base and to upgrade a significant part of the resource from the Inferred category to the higher confidence Indicated category.

REM holds a 20.76% economic interest in Cinovec, via its interest in European Metals Holdings Limited ("EMH"). The full EMH release is available at:

http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/EMH/13131140.html

Highlights from the EMH release:

-- Lithium Indicated Resource increased 50% to 3.9 Mt LCE, contained in 347.7 Mt @ 0.45% Li(2) O and 0.04% Sn (0.1% Li cut-off)

-- Lithium Total Resource increased 11.8% to 7.0 Mt LCE, contained in 656.5 Mt @ 0.43% Li(2) O and 0.04% Sn (0.1% Li cut-off)

   --   Total contained tin in the Total Mineral Resource increases to 262,600 tonnes 
   --   Lithium Exploration Target remains 350 to 450 Mt @ 0.39% to 0.47% for 3.4 Mt to 5.3 Mt of LCE. 

Kiran Morzaria, the Chief Executive Officer of REM, commented:

"This upgraded resource statement firmly establishes Cinovec as globally significant, strategically located lithium deposit. These results have shown Cinovec to have a robust Mineral Resource, and will, in our opinion, strengthen the project economics going forward. EMH has established a strong base from which it can progress its development programme, and we look forward to updating the market on what has been an excellent investment for REM."

Independent Resource Consultant Lynn Widenbar noted:

"The additional new drilling results from 2016 have greatly increased confidence in the historic surface and underground drilling and sampling, resulting in a substantial amount of previously Inferred material being re-classified as Indicated. The additional drilling has also enabled the two main value elements of lithium and tin to be combined in one complete model that covers the entire mineralisation at the Cinovec deposit."

CAUTIONARY STATEMENT

The potential quantity and grade of the Exploration Target is conceptual in nature, there has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource.

Mineral Resource Upgrade

Independent expert Lynn Widenbar of Widenbar and Associates updated the Mineral Resource Estimates. Mr Widenbar has compiled all resource estimates at Cinovec to-date. As stated above, the two main value elements of lithium and tin have been combined in one complete model that covers the entire mineralisation at the Cinovec deposit as set out in Table 1 below, at a 0.1% Li Cut-off.

Table 1: Cinovec Project Mineral Resource Estimate, February 2017 (0.1% Li Cut-off)

 
                 Cinovec Lithium and Tin Mineral Resource 
-------------------------------------------------------------------------- 
 Category                                     Gross 
-----------  --------  --------------------------------------------------- 
              Cut-off   Tonnes    Li    Li2O   LCE (Mt)   Sn (%)   Sn (t) 
               Li (%)    (Mt)     (%)    (%) 
-----------  --------  -------  -----  -----  ---------  -------  -------- 
 Indicated      0.1     347.7    0.21   0.45     3.89      0.04    139,080 
-----------  --------  -------  -----  -----  ---------  -------  -------- 
 Inferred       0.1     308.8    0.18   0.39     2.99      0.04    123,520 
-----------  --------  -------  -----  -----  ---------  -------  -------- 
 Total          0.1     656.5    0.2    0.43     6.99      0.04    262,600 
-----------  --------  -------  -----  -----  ---------  -------  -------- 
 

Notes:

1. Mineral Resources are not reserves until they have demonstrated economic viability based on a feasibility study or pre- feasibility study.

2. Mineral Resources are reported inclusive of any reserves and are prepared by Widenbar in accordance with the guidelines of the JORC Code.

   3.     The effective date of the Mineral Resource is February 2017. 
   4.     All figures are rounded to reflect the relative accuracy of the estimate. 

5. The operator of the project is Geomet s.r.o., a wholly-owned subsidiary of EMH. Gross and Net Attributable resources are the same.

   6.     Any apparent inconsistencies are due to rounding errors. 
   7.     LCE is Lithium Carbonate Equivalent and is equivalent to Li2CO3. 

The Cinovec database used for the Mineral Resource Estimate incorporates information derived from almost 800 historic underground and surface diamond drill holes, historic underground channel sampling as well as the 26 surface diamond holes drilled to date by European Metals. A total of 73,785 assay intervals are now included in the database. Figure 1 is a map showing the location of holes drilled by European Metals relative to historic drill holes and underground workings.

(The full graphic of Figure 1 - "Plan view of Cinovec Project drill hole locations, historic underground workings, Li Indicated and Inferred Resource"- will be available on the European Metals website www.europeanmet.com and in the ASX announcement to be released prior to ASX market open Monday, 20 February 2017.)

Historically, core samples were either split or consumed entirely, with intervals ranging from 0.03 to 10.5m; more than 99.75% of historic drill samples fall in a range between 0.1 and 3m long. Historic channel samples were collected across 1m intervals. Samples collected from 2014, 2015 and 2016 holes drilled by European Metals comprised half core and honoured geological contacts and mineralised domains, ranging from 0.5 to 2.1m long.

Historic analytical methods included XRF and wet chemical techniques; samples collected from the new holes were analysed by fusion or 4 acid digest with ICP finish. Assay data were composited to 1m intervals prior to Mineral Resource estimation.

Sample spacing used in Mineral Resource estimation for tin ranges from continuous channel sampling up to approximately 100m. The range reflects the density of historical work - samples are very closely spaced in areas of underground development and trial mining, less so in areas sampled only by surface or underground drill holes.

Sample spacing used for lithium Mineral Resource estimation is wider, as not all historic samples were assayed for lithium; sample spacing typically ranges from 50m to 200m. Note that only blocks in the lithium model which had an average distance to samples used of less than 100m were assigned to the Mineral Resource, with the remainder considered to form part of an Exploration Target.

At a 0.1% Li cutoff, the Exploration Target is: 350 to 450 Mt @ 0.39 to 0.47% Li2O for 3.4 to 5.3 Mt LCE

The Sn-W-Li mineralisation is hosted in an alkalic granite cupola of late Variscan age. Tin and tungsten occur mainly in oxide minerals (cassiterite and wolframite). Lithium occurs mainly in zinnwaldite, a Li-rich muscovite. Quartz veining and greisenisation is associated with the mineralisation. Typically, highest grade lithium mineralization is associated with the greisen but large portions of the lithium resource are also hosted in the greisenized granite or other types of altered granite.

A geological domain model was constructed using Leapfrog software with solid wireframes representing greisen, granite, greisenised granite and the overlying barren rhyolite. In addition a thin overburden layer is modelled near surface and a low-mica granite is modelled to form the lower limit of the mineralisation. This was used to both control interpolation and to assign density to the model.

(The full graphic of Figure 2 - "Easting Section at -778890E showing geological model"- will be available on the European Metals website www.europeanmet.com and in the ASX announcement to be released prior to ASX market open Monday, 20 February 2017.)

Analysis of sample lengths indicated that compositing to 1m was necessary. Search ellipse sizes and orientations for the estimation were based on drill hole spacing, the known orientations of mineralisation and variography. A Kriging Neighbourhood Analysis was also carried out using Kriging Variance, Kriging Efficiency and Slope of Regression to optimise search parameters. An "unfolding" search strategy was used which allowed the search ellipse orientation to vary with the locally changing dip and strike.

After statistical analysis, a top cut of 5% was applied to Sn% and W%; no top cut is applied to Li%. Sn%, W% and Li% were then estimated by Ordinary Kriging within the geological solids.

(The full graphic of Figure 3 - "Easting Section at -778890E showing Lithium grade estimates"- will be available on the European Metals website www.europeanmet.com and in the ASX announcement to be released prior to ASX market open Monday, 20 February 2017.)

The primary search ellipse was 150m along strike, 150m down dip and 7.5m across the mineralisation. A minimum of 4 composites and a maximum of 8 composites were required. A second interpolation with search ellipse of 300m x 300m x 12.5m was carried out to inform blocks to be used as the basis for an exploration target. Block size was 5m (E-W) by 10m (N-S) by 5m.

Validation of the final resource has been carried out in a number of ways including section comparison of data versus model, swathe plots and production reconciliation.

Densities applied for Mineral Resource tonnage calculations are based on historical bulk density measurements of 2.57 for granite and 2.70 for greisen, confirmed by laboratory measurements in 2016.

The impact of the new European Metals drill holes on the geological model and the block model have been reviewed. Globally the geology and resource model are similar to the previous (November 2016) model, with only relatively minor local changes to grade distributions. The increase in confidence resulting from the new drill data has allowed additional areas of the block model to be upgraded in classification from Inferred to Indicated.

Qualified Person:

Kiran Morzaria B.Eng. (ACSM), MBA, has reviewed and approved the information contained in this announcement. Kiran holds a Bachelor of Engineering (Industrial Geology) from the Camborne School of Mines and an MBA (Finance) from CASS Business School.

- Ends -

 
  For further information 
    please contact 
 
   Rare Earth Minerals plc      [phone] 
   Andrew Suckling 
   Kiran Morzaria 
 
   WH Ireland Limited (NOMAD 
    & Broker)                   [phone] 
   James Joyce 
   James Bavister 
 
   Square1 Consulting           [phone] 
   David Bick 
   Brian Alexander 
 

About Rare Earth Minerals

Rare Earth Minerals invests across the globe, principally in lithium mining projects. Its primary strategy is taking significant economic stakes in upstream exploration and development assets within strategic metals. We identify assets that have strategic cost advantages that are not replicable, with the aim of achieving lower quartile production costs. The combination of this approach and seeking value opportunities allows us to identify projects capable of achieving high rates of return.

The Rare Earth Minerals board has a blend of mining, commodity investing, fund management and deal structuring knowledge and experience, that is supported by access to key marketing, political and industry contacts. These resources are leveraged not only in our investment decisions but also in continuing support of our investments, whether it be increasing market awareness of an asset, or advising on product mix or path to production. REM's goal is to assist management to rapidly develop the project up the value curve and deliver excellent returns on its investments.

Rare Earth Minerals are major shareholders of the Sonora Lithium Project in northern Mexico and the Cinovec Lithium and Tin Project in the Czech Republic. Rare Earth Minerals portfolio also includes significant lithium-based investments the USA, Australia and Namibia. The Mexican and Czech deposits have published Indicated and Inferred Mineral Resources more than 15 million tonnes of Lithium Carbonate Equivalent.

This information is provided by RNS

The company news service from the London Stock Exchange

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February 20, 2017 02:00 ET (07:00 GMT)