Mr. Donald Ranta reports
RARE ELEMENT REPORTS UPGRADE AND SIGNIFICANT INCREASE OF RARE-EARTH MINERAL RESOURCES AT BEAR LODGE
Rare Element Resources Ltd. has released results of an upgraded and increased NI
43-101-compliant mineral resource estimate of rare-earth elements plus yttrium contained in three deposits located in the Bull
Hill area of the Bear Lodge project, Wyoming. The updated
resource estimate upgrades 4.9 million tons (4.44 million metric tonnes) to
the indicated category and increases the total pounds of rare-earth oxides contained
in the Bull Hill high-grade deposits by 20 per cent from 1,210 million pounds
(550 million kilograms) to 1,450 million pounds (660 million kg) at a 1.5 per cent REO
cut-off grade. The mineral resources were estimated by
Ore Reserves Engineering, an independent consultant.
The new resource estimate is derived from an REE database that includes 86 core drill holes completed by the company between 2008 and
2010 for a total of 62,625 feet (19,093 metres). New drill holes were
substituted for holes drilled prior to 2008, owing to uncertainties
introduced by a lack of surface and downhole survey data.
Approximately 16 holes completed by other companies prior to 2004
were also not included in the model. The new resource estimate focuses
on the dike sets in the Bull Hill Southwest deposit, plus the Bull Hill
Northwest and the Whitetail Ridge deposit areas. In addition, the drilling indicates significant potential for
expansion of all three deposits, for discovering mineralization in the
undrilled areas between the deposits, and for definition of resources
in other areas, such as Bull Hill West and the Carbon REE target.
The total mineral resources estimate by ORE for the three deposits are
summarized in the tables at a range of cut-off grades and for
the different oxidation zones, including the oxide, oxide-carbonate,
transitional, and sulphide/unoxidized zones.
TOTAL INDICATED TONS AND GRADE OF THE VARIOUS OXIDATION ZONES
AT A RANGE OF CUT-OFF GRADES
Cut-off Oxide Oxide-carb. Total oxidized
Grade Tons Grade Tons Grade Tons Grade
(%REO)1,3 (million) (%REO) (million) (%REO) (million) (%REO)
1 4.5 2.88 2.3 3.41 6.8 3.06
1.53 2.9 3.78 2.0 3.75 4.9 3.77
2 2.3 4.33 1.8 4.02 4.0 4.20
2.5 1.8 4.94 1.5 4.35 3.2 4.67
3 1.4 5.53 1.2 4.80 2.6 5.20
3.5 1.1 6.12 0.9 5.27 2.0 5.74
4 0.9 6.72 0.7 5.74 1.6 6.30
4.5 0.7 7.29 0.5 6.27 1.2 6.87
5 0.6 7.73 0.4 6.81 1.0 7.39
TOTAL INFERRED TONS AND GRADE OF THE VARIOUS OXIDATION ZONES AT A RANGE OF CUT-OFF GRADES
Cut-off Oxide Oxide-carb. Total oxidized Transitional Sulphide Total
Grade Tons Grade Tons Grade Tons Grade Tons Grade Tons Grade Tons Grade
(%REO) (million) (%REO) (million)(%REO) (million)(%REO) (million)(%REO) (million)(%REO) (million)(%REO)
1.0 13.7 2.49 4.3 2.52 18.0 2.50 1.8 2.11 7.6 2.22 27.3 2.39
1.5 8.4 3.33 3.3 2.93 11.6 3.22 1.0 2.71 5.1 2.68 17.8 3.03
2.0 6.6 3.76 2.6 3.22 9.2 3.60 0.7 3.23 3.4 3.16 13.3 3.47
2.5 5.1 4.20 2.1 3.49 7.1 3.99 0.5 3.58 2.3 3.58 10.0 3.88
3.0 3.5 4.88 1.4 3.88 4.9 4.60 0.3 4.10 1.4 4.17 6.5 4.48
3.5 2.4 5.67 0.7 4.45 3.1 5.39 0.2 4.49 1.0 4.51 4.3 5.13
4.0 1.7 6.41 0.4 4.93 2.2 6.11 0.2 4.75 0.7 4.90 3.0 5.77
4.5 1.5 6.83 0.3 5.32 1.7 6.59 0.1 5.38 0.4 5.41 2.2 6.34
5.0 1.2 7.22 0.2 5.67 1.4 7.03 0.0 6.01 0.3 5.75 1.7 6.81
RESOURCE ESTIMATES AND CONTAINED REO FOR THE THREE INDIVIDUAL DEPOSITS
Zone Bull Hill SW Bull Hill NW Whitetail R. Total
Resource Cut-off pounds
Class Grade Tons Grade Tons Grade Tons Grade Tons Grade REO
Oxidation (%REO) (millions)(%REO) (millions)(%REO) (millions)(%REO) (millions) (%REO) (millions)
Indicated Oxide 1.5 2.9 3.78 - - - - 2.9 3.78 220
Oxide and carbonate 1.5 2.0 3.75 - - - - 2.0 3.75 149
Total oxidized 1.5 4.9 3.77 - - - - 4.9 3.77 369
Inferred Oxide 1.5 5.9 3.48 1.0 2.38 1.6 3.32 8.4 3.33 557
Oxide and carbonate 1.5 3.0 2.98 0.1 2.04 0.2 2.50 3.3 2.93 192
Total oxidized 1.5 8.9 3.31 1.1 2.35 1.7 3.24 11.6 3.22 749
Transition 1.5 0.9 2.80 0.1 2.08 0.0 1.79 1.0 2.71 56
Sulfide 1.5 3.9 2.80 1.2 2.30 0.0 1.69 5.1 2.68 275
Total inferred 1.5 13.7 3.13 2.4 2.31 1.7 3.22 17.8 3.03 1080
The distribution of individual rare-earth oxides for the total indicated
and inferred resources in the oxide and oxide-carbonate zones are given
in the tables.
DETAILED RARE-EARTH ELEMENT GRADES OF INDIVIDUAL REO FOR
INDICATED RESOURCES OF OXIDE AND OXIDE-CARBONATE ZONE MINERALIZATION
Parametres and % REO Oxide Oxide-carb. Total oxide
Cut-off (%REO) 1.5 1.5 1.5
Tons resource (millions) 2.9 2.0 4.9
Tonnage factor (ft3/ton) 15.3 14.8 15.1
%REO 3.78 3.75 3.77
Million lb REO 220 149 369
%Cerium oxide Ce2O3 1.64 1.65 1.64
%Lanthanum oxide La2O3 1.10 1.05 1.08
%Neodymium oxide Nd2O3 0.64 0.65 0.65
%Praseodymium oxide Pr2O3 0.187 0.185 0.186
%Samarium oxide Sm2O3 0.098 0.101 0.099
%Gadolinium oxide Gd2O3 0.049 0.047 0.048
%Yttrium Y2O3 0.032 0.026 0.029
%Europium oxide Eu2O3 0.021 0.020 0.021
%Dysprosium oxide Dy2O3 0.0111 0.0094 0.0104
%Terbium oxide Tb2O3 0.0039 0.0035 0.0037
%Erbium oxide Er2O3 0.0025 0.0023 0.0024
%Ytterbium oxide Yb2O3 0.0015 0.0014 0.0015
%Holmium oxide Ho2O3 0.00123 0.00104 0.00116
%Lutetium oxide Lu2O3 0.00019 0.00018 0.00019
%Thulium oxide Tm2O3 0.00021 0.00018 0.00020
DETAILED RARE-EARTH-ELEMENT GRADES OF INDIVIDUAL REO FOR
INFERRED RESOURCES OF ALL MINERALIZED ZONES
Oxide- Total
Parametres and % REO Oxide carb. oxide Transition Sulphide Total
Cut-off (%REO) 1.5 1.5 1.5 1.5 1.5 1.5
Tons resource (millions) 8.4 3.3 11.6 1.0 5.1 17.8
Tonnage factor (ft3/ton) 15.4 14.8 15.2 14.0 11.8 14.2
%REO 3.33 2.93 3.22 2.71 2.68 3.03
Million lb REO 557 192 749 56 275 1,080
%Cerium oxide Ce2O3 1.39 1.27 1.36 1.19 1.21 1.30
%Lanthanum oxide La2O3 0.91 0.77 0.87 0.75 0.75 0.83
%Neodymium oxide Nd2O3 0.60 0.55 0.59 0.48 0.45 0.54
%Praseodymium oxide Pr2O3 0.166 0.149 0.161 0.134 0.133 0.152
%Samarium oxide Sm2O3 0.104 0.087 0.099 0.075 0.066 0.088
%Gadolinium oxide Gd2O3 0.058 0.042 0.053 0.034 0.030 0.046
%Yttrium Y2O3 0.040 0.025 0.036 0.019 0.016 0.029
%Europium oxide Eu2O3 0.024 0.018 0.023 0.015 0.013 0.020
%Dysprosium oxide Dy2O3 0.0155 0.0094 0.0138 0.0067 0.0058 0.0111
%Terbium oxide Tb2O3 0.0052 0.0034 0.0047 0.0025 0.0022 0.0039
%Erbium oxide Er2O3 0.0030 0.0023 0.0028 0.0015 0.0014 0.0023
%Ytterbium oxide Yb2O3 0.0017 0.0014 0.0016 0.0010 0.0008 0.0014
%Holmium oxide Ho2O3 0.0017 0.0010 0.0015 0.0007 0.0006 0.0012
%Lutetium oxide Lu2O3 0.00022 0.00018 0.00021 0.00013 0.00011 0.00017
%Thulium oxide Tm2O3 0.00026 0.00018 0.00024 0.00013 0.00011 0.00019
- REO (rare-earth oxides) include Ce2O3, La2O3, Nd2O3, Pr2O3, Sm2O3, Gd2O3,, Y2O3, Eu2O3, Dy2O3, Tb2O3, Er2O3 and other minor oxides listed in general order of decreasing abundance
in the deposits.
- The resources estimates are classified as indicated and inferred mineral
resources as defined by Canadian Institue of Mining and referenced in NI 43-101.
- ORE considers a range of 1.0 to 2.5 per cent REO cut-off grade to be
reasonable in preliminary estimation of potentially economic resources.
A cut-off grade of 1.5 per cent REO has been selected as the base case and it is
highlighted; a cut-off grade of 3.0 per cent REO is also highlighted to show the
higher-grade tons above the cut-off. Low-grade material above 0.5 per cent
cut-off grade is undergoing metallurgical testing to determine if a
simple low-cost process can result in its being upgraded.
- A detailed program of core sampling and bulk density measurement was
conducted successfully during the 2010 drilling program, especially for
oxide mineralization which is more difficult to measure accurately.
Resources were estimated using inverse-distance weighting with grade
zones to differentiate between high-grade and stockwork
mineralization. High-grade mineralization was defined as a minimum 30
feet (6.1 m) true width above 1.5 per cent for the main southwest area. Slightly
different cut-off grades and minimum widths were used in other areas.
Drill holes were composited to nominal 10-foot (3.05-metre) true-width
intervals for estimation. Grades were not capped, but oxide and
oxide-carbonate grades were adjusted downward for estimation of the
transition and sulphide zones to compensate for the significant increase
in grade in the oxidized zones. Grades were estimated using trend
surfaces to interpolate parallel to the carbonatite/FMR dike
orientation. The resource model blocks are 10- by 10- by 10-foot cubes.
Based on current REO prices, the cut-off grade of 1.5 per cent REO was selected
near the midpoint of a range of likely cost scenarios. As additional
data are gathered, work will continue to be done on the resource
estimates with further evaluation and refinement.
For comparison, the previous NI 43-101-compliant inferred mineral
resource estimated by ORE was 17.5 million tons (15.9 mm tonnes)
averaging 3.46 per cent rare-earth oxides, all in the inferred category
(see news release dated May 26, 2010, and technical report dated
Nov. 14, 2010).
"The Bear Lodge project is advancing rapidly. The current upgraded
resource, plus additional resources planned for upgrade during the 2011
drill program, will be included in a preliminary feasibility study
scheduled for completion in late 2011 or early 2012. The company's 2011
exploration program is planned to include more than 50 infill and
step-out drill holes to further upgrade and expand the resource. We are
also looking forward to the results of our pilot plant metallurgical
test this year on a 10-ton bulk sample as a demonstration of
advancement toward a commercial process, and for inclusion of the test
results in our prefeasibility study of the Bear Lodge project," stated
Dr. Don Ranta, president of Rare Element Resources.
Geology and mineralization
Rare-earth-element mineralization occurs in the north-central core of
the Bear Lodge alkaline-igneous complex located in northeastern
Wyoming. All of the most important REE deposits and occurrences in the
Bear Lodge district are controlled by Rare Element's lode claims, and
are located in the vicinity of Bull Hill.
Rare-earth mineralized bodies occurring as dikes and veins within the
Bull Hill area of the district include a well-defined, near-surface
oxidized FMR (iron oxide-manganese oxide-REE) zone, a near-surface
oxidized but incompletely leached-carbonatite zone (oxide-carbonate
zone), a transitional or mixed zone (oxide and sulphide), and a deeper
sulphide-bearing carbonatite (a high-carbonate igneous rock) zone. The
oxide-carbonate and transitional zones were referred to collectively in
previous new releases and technical reports as transitional zone. As
the company's understanding of the deposit has progressed, it made
sense to subclassify mineralized zones based on key characteristics of
those zones. The FMR dikes and veins contain no matrix carbonates or
sulphides. The sulphides are completely oxidized to hydrous iron oxides,
and the non-REE-bearing carbonate minerals (calcite and strontianite)
are completely leached from the zone, which ranges from the surface to
depths of about 300 to 500 feet. The oxide-carbonate zone generally
occurs beneath the oxide zone, but may locally breach the surface in
select dikes. It is characterized by an absence of sulphides, with the
residual iron oxides formed during the complete oxidation of the former
sulphide minerals, and by variable amounts of relict matrix carbonates
(calcite plus or minus strontianite). As now defined, the transitional zone is
relatively flat lying and occurs as a thin layer immediately above the
sulphide-bearing carbonatite zone. It contains mixed iron oxides and
sulphides, along with a significant amount of relict-matrix carbonates.
The iron oxides in this zone are derived primarily from the variable
partial to complete oxidation of constituent sulphide minerals. The
unoxidized sulphide-bearing carbonatite at depth has not been leached of
matrix carbonates and retains all of its initial sulphide content.
Metallurgy of the oxide zone is well established and has been reported
previously. Initial metallurgical testing of the oxide-carbonate zone
resource indicates that mineral preconcentration test results are
similar to those for the oxide zone mineralization. Early indications
suggest that chemical concentration of the REO from this zone will
consume more reagents than the oxide zone mineralization.
The Bull Hill Southwest deposit contains the bulk of the current resources. The deposit
comprises a steeply dipping FMR-carbonatite dike swarm. Geological
interpretation of results from the 2010 drill program indicate that the
Bull Hill Southwest resource area is dominated by northwest-striking
mineralized bodies in the southern two-thirds of the resource area,
while the northern part of the resource area exhibits a transitional
change in strike from dominantly northwesterly to almost due north. The
dike swarm primarily intrudes heterolithic intrusive breccia of the
Bull Hill diatreme. Carbonatite dikes at depth are interpreted to
transition toward the surface into either oxide-carbonate bodies or FMR
bodies, which range in size from veinlets to large dikes more than 100
feet in width. The Bull Hill Southwest deposit consists of one dominant
dike set and several subsidiary dike sets in a swarm that strikes over
1,500 feet in length and covers several hundred feet in width. The
dikes appear to pinch and swell in both strike and dip directions, and
they can be traced in drill holes more than 1,000 feet downdip. A
number of gold deposits and other occurrences of anomalous gold are
distributed peripherally to the Bull Hill REE mineralization and are
part of the company's Sundance gold project.
The Bull Hill Northwest deposit shares many characteristics with the Bull Hill Southwest
deposit. The oxide zone extends somewhat deeper, probably owing to a
complex regime of intersecting structures. The structural controls for
the mineralized bodies remain incompletely understood in this target
area, but it appears most likely that northerly-striking mineralized
bodies predominate. The dikes cut alkalic silicate rocks, predominantly
trachytes and phonolites, and they are part of an FMR/carbonatite dike
system that appears to be separate from the Bull Hill Southwest dike system.
The deposit is open to the north and at depth. Additional drilling will
be done during the 2011 program to better define the orientation of the
system and to expand the current resource.
The Whitetail Ridge deposit is marked at the surface by a zone of FMR stockwork and a
coincident geophysical anomaly. The size of the geophysical anomaly
(approximately 1,400 by 2,000 feet elongate northeasterly) provides an
indication that the REE target may be larger than others in the
district. Detailed mapping suggests that the REE mineralization
consists of northwest-striking FMR dikes and an FMR stockwork zone that
is elongate northeasterly, with dimensions of roughly 1,250 feet (380
metres) by 950 feet (290 metres). The enveloping geophysical anomaly is
larger and may indicate a broader distribution of REE mineralization
beneath the extensive soil and colluvial cover. This is the same area
that the U.S. Bureau of Mines drilled in the 1950s and estimated a large
tonnage of low-grade stockwork mineralization. Only a small part of
this target area has been tested with the company's drill holes.
Drilling during the company's planned 2011 program is expected to
expand and better delineate the current Whitetail Ridge resource.
The major dike sets in all of the resource areas are accompanied by
peripheral zones of lower-grade stockwork REE mineralization. The term
stockwork refers to a rock cut by a network of small veins or dikes
that contain the mineralization. REE grades in the stockwork zones
range between about 0.5 and 2 per cent REO. The company is investigating
low-cost physical processing methods to upgrade the contained REE
mineralization in the stockwork for eventual inclusion with the
resources reported here.
The company considers the geologic modelling and resource estimation
results encouraging for the following reasons:
- A portion of the oxidized resource was upgraded to the indicated
category.
- The tonnage of the overall resource was expanded relative to the May,
2010, NI 43-101-compliant resource estimate, but with slightly lower
REO grades.
- The more extensively drilled Bull Hill Southwest deposit shows excellent
lateral and vertical continuity of grades within the dike sets.
- The REE mineralization that constitutes the Bull Hill Southwest resource is
open for expansion at depth, to the southeast, and to the northwest
toward Whitetail Ridge.
- The Whitetail Ridge deposit was defined by drilling in only a small part
of the target area.
- The Bull Hill West target area hosts FMR/carbonatite dikes that may be
related to both the Bull Hill SW and Whitetail Ridge mineralizing
systems and mineralization is open in all directions.
- The company believes that there is room for the mineral resource tonnage
to increase significantly in all deposit and target areas.
- Bulk-tonnage, lower-grade stockwork mineralization adjacent to the
higher-grade zones is extensive and only a small part of the potential
has been tested by drill holes. With further metallurgical testing,
this material may be defined as an additional resource.
- The updated mineral resource estimate confirms that potentially economic
resources are present in the Bull Hill area, and it justifies further
technical work including drilling, metallurgical testing, and
engineering studies. Considerable infill definition drilling is
required to increase the confidence level and upgrade more of the
inferred resources to the indicated category. Step-out drilling is
planned to expand the resource and define the boundaries of the
mineralization.
Cut-off grade and metallurgy
The resource size is sensitive to an assumed cut-off grade, which is
sensitive to metallurgical operating costs. The company is advancing
its rare earth metallurgical studies at: 1) Mountain States Research and
Development International, Vail, Ariz., under the direction of Dr.
Roshan Bhappu, PE, 2) Nagrom, Perth, Australia under the direction of
Tony Wilkinson, and 3) Hazen Research, Golden, Colo., under the
direction of Roland Schmidt and Chris Schultz. The objective for each
of these testing laboratories is developing and optimizing an effective
and cost-efficient metallurgical flowsheet. The metallurgical testing
program will continue through 2011 on mineralized core samples
collected during 2010. The test program will include a pilot-plant test
using approximately 10 tons of material collected in 2010, near the
surface with large-diametre core drilling and from surface samples
collected during drill-site excavations.
Mineral resources are not reserves
Mineral resources that are not mineral reserves do not have demonstrated
economic viability. Mineral resource estimates do not account for
minability, selectivity, mining loss and dilution. These mineral
resource estimates are in the indicated and inferred mineral resource
categories. Inferred mineral resources are normally considered too
speculative geologically for the application of economic considerations
that would enable them to be categorized as mineral reserves; however
they are allowed to be included in a preliminary economic assessment.
There is also no certainty that these inferred mineral resources will
be converted to measured and indicated mineral resource categories
through further drilling, or into mineral reserves once economic
considerations are applied.
Quality assurance
The mineral resource estimate was completed by Alan C. Noble, PE,
principal engineer of Ore Reserves Engineering, and is based on
geological interpretations supplied by the company to Ore and
subsequently modified by Ore. Mr. Noble is an independent qualified
person for the purposes of National Instrument 43-101 standards of
disclosure for mineral projects of the Canadian Securities
Administrators and has verified the data disclosed in this release.
The Rare Element Resources' field programs were carried out under the
supervision of Dr. James G. Clark, the company's vice-president of
exploration, and by Dr. Ellen Leavitt, who is a qualified person for
the purposes of National Instrument 43-101 standards of disclosure for
mineral projects of the Canadian Securities Administrators. Dr. Clark
was also a senior geologist and, subsequently, exploration supervisor
for Hecla Mining company during that company's exploration of Bull Hill
and the Bear Lodge district, and initial discovery of the Bull Hill Southwest
resource area, during the late 1980s and early 1990s. A detailed
quality assurance and quality control program was implemented for the 2007 through 2009 drill programs.
The QA/QC program was organized by Dr. Jeffrey Jaacks. Dr. Jaacks and
Dr. Clark have verified the sampling procedures and QA/QC data
delivered to ORE. They share the opinion that the data are of good
quality and suitable for use in the resource estimate.
A full table of significant drill results from the company's 2004-2010
exploration programs, along with maps and sections detailing the drill
hole locations, are available on the company's website.
We seek Safe Harbor.
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