Though the company is publishing improvements to their initial resource estimate which used a 0.4% cut-off, the use of a 0.3% cut-off significantly improves the resource. By comparison, the Niobec mine in Quebec uses a 0.2% cut-off in it’s operations.
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VANCOUVER, BRITISH COLUMBIA–(Marketwired – Sept. 22, 2014) – NioCorp Developments Ltd. (“NioCorp” or the “Company“) (TSX VENTURE:NB)(OTCQX:NIOBF)(FRANKFURT:BR3) is pleased to announce an updated NI43-101 resource estimate for the Elk Creek niobium deposit.
[box type=”note” align=”aligncenter” ]Last week, when discussing Polymet’s project in Minnesota, we talked about how the US (aside from a few states) was one of the worst places in the world to try and open a mine. Despite the challenges of manoeuvring within the US permitting system, there is no shortage of companies advancing US-based resource projects. Niocorp is a good example. While other junior miners are struggling in a depressed market, Niocorp is raising money handily and their stock is near all time highs.
This news announces an upgraded resource for the project based on the most recent round of drilling. The last time we talked about NioCorp they were getting some of the first results in from this drilling.
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Commencing in May, the Company initiated a three phase technical infill drilling program, with multiple goals of enhancing the classification of the resource; producing geotechnical and geochemical analysis of the deposit; provide material for the use in metallurgical studies including pilot plant; and to provide all other necessary information required to create and design a mine plan. Additional drilling to enhance the overall size of the deposit, where it remains open to the northwest, southeast, and at depth, will be carried out in the future.
[box type=”note” align=”aligncenter” ]Infill drilling is exactly what it sounds like – the drilling of new holes between existing holes. Infill drilling increases the confidence level of reported resources by removing some of the assumptions about the continuity of mineralization. It’s one thing to interpret that a mineralized zone might be continuous between two holes, it’s another thing to verify that interpretation though drilling. Improved confidence can allow a company to upgrade their resources to a higher confidence category.
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The Company has completed the phase 1, five-hole drill program for a total of 5,011 m, with the phase 2, six-hole drill program now currently underway. Phase 3 will follow, if necessary. Utilizing historic and phase 1 drilling results, SRK Consulting (“SRK”) of Lakewood, Colorado and Cardiff, UK have completed an updated mineral resource estimate.
SRK’s Mineral Resource is based on a robust 3D model of grade trends within the carbonatite complex and is based on good QAQC results. Higher grades are associated with pyrochlore contained in magnetite bearing dolomitic carbonatite. The Indicated Mineral Resource is confined to a single coherent well drilled area containing continuous high grade features.
[box type=”note” align=”aligncenter” ]Carbonatites are a rare type of type of igneous rock composed primarily of carbonate minerals such as calcite. While carbonate minerals are not rare in sedimentary (e.g. limestone) or metamorphic settings (e.g. marble), a carbonate-rich magma and the resulting carbonatite rock are a rare occurrence. Carbonatites also have a tendency to be enriched in rare earth elements and other elements such as phosphorus, uranium, copper, iron and niobium.
The company is reporting that the niobium is associated with the mineral pyrochlore. Pyrochlore is an oxide mineral that can carry a wide array of rare elements. What’s most important here is that metals can be easily extracted from oxide minerals. If the niobium was trapped in a silicate mineral structure (eg. quartz, feldspar) for example, it would be very difficult to extract and not likely economic.
Geochemical assays can identify the quantity of a specific element in a sample of drill core, but it doesn’t give the full picture. Close examination of the rock by geologists are necessary to determine nature of the mineralization. In some cases, expert mineralogical analysis may be necessary to identify the nature of the mineralization.
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The estimate has been reported according to CIM Standards and will be supported by a NI43-101 independent report which will be published in due course.
The resource estimate for the Elk Creek deposit is summarized in Table 1 below:
| Table 1 – SRK Mineral Resource Statement Effective Date 9th September 2014 | ||||
| Classification | Cut-off (Nb2O5%) |
Tonnage (‘000 Tonnes) |
Grade (Nb2O5%) |
Contained Nb2O5 (‘000 kg) |
| INDICATED | 0.30 | 28,200 | 0.63 | 177,000 |
| INFERRED | 0.30 | 132,800 | 0.55 | 733,700 |
| (1) Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. All figures are rounded to reflect the relative accuracy of the estimate and have been used to derive sub-totals, totals and weighted averages. Such calculations inherently involve a degree of rounding and consequently introduce a margin of error. Where these occur, SRK does not consider them to be material. All composites have been capped where appropriate. The Concession is wholly owned by and exploration is operated by Niocorp Developments Ltd. | ||||
| (2) The reporting standard adopted for the reporting of the MRE uses the terminology, definitions and guidelines given in the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Mineral Reserves (December 2005) as required by NI 43-101. | ||||
| (3) SRK assumes the Elk Creek deposit to be amenable to a variety of Underground Mining methods. In the absence of definitive pricing for Nb and established rates of metallurgical recovery, SRK has reported the Mineral Resource at a cut-off of 0.3% Nb2O5. The Company’s previous Mineral Resource dated April 2012 was calculated at a cut-off of 0.4% Nb2O5. | ||||
| (4) SRK Completed a site inspection to the deposit by Mr Martin Pittuck, MSc., C.Eng, MIMMM, an appropriate “independent qualified person” as this term is defined in National Instrument 43-101. | ||||
Given the current early stage in the other technical disciplines and on-going metallurgical testwork the sensitivity in the Mineral Resource at a range of preliminary cut-off grades is presented in Table 2 from 0.3% Nb2O5 to 0.5% Nb2O5.
| Table 2 – SRK Mineral Resource Sensitivity | ||||
| Classification | Cut-off (Nb2O5%) |
Tonnage (‘000 Tonnes) |
Grade (Nb2O5%) |
Contained Nb2O5 (‘000 kg) |
| INDICATED | 0.50 | 19,100 | 0.74 | 142,000 |
| INDICATED | 0.40 | 22,600 | 0.70 | 157,600 |
| INDICATED | 0.30 | 28,200 | 0.63 | 177,000 |
| INFERRED | 0.50 | 63,700 | 0.74 | 469,600 |
| INFERRED | 0.40 | 87,000 | 0.66 | 573,300 |
| INFERRED | 0.30 | 132,800 | 0.55 | 733,700 |
Readers should note that this update only includes the results of phase 1 drilling operations. Work is currently on-going to improve the confidence in the current geological model through additional drilling and further validation of historical databases. Validation work is aimed to be completed with the completion of phase 2 drilling operations in the 4th quarter, at which point the company intends to deliver a follow up resource estimate which will include that data.
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The company’s previous 43-101 compliant resource report used a cut-off of 0.4%. Based on that cut-off, the indicated resource has increased from 19.3 Million tonnes grading 0.67% Nb2O5 to 22.6 million tonnes grading at 0.70%. Inferred resources have increased from 83.3 million tonnes at 0.63% Nb2O5 to 87.0 million tonnes at 0.66%.
As shown above, the use of a 0.3% cut-off significantly improves the resource. Given that their updated resource published in Table 1 uses a 0.3% cut-off, it looks like the company may start to use that for their base case.
For comparison, IAMGOLD’S Niobec niobium mine in Canada has Measured and Indicated Resources of 635 million Tonnes at 0.41% Nb2O5 with a cut-off of 0.2%.
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“Drill results have far exceeded our expectations on this deposit, and we are a very pleased to be able to deliver this resource update to shareholders,” stated Mark A. Smith, CEO of NioCorp. “We are also very impressed with the significant progress being achieved on the metallurgy program as we rapidly approach the pilot plant test stage. The information we now know, combined with the upcoming pilot plant results and the updated resource estimate before year end, will dovetail into the extensive engineering design work that SRK are diligently completing, in order to fully meet our overall objectives for this world-class project.”
The Company will file the complete NI43-101 compliant report on SEDAR and it will be available on the Company’s website within the prescribed timeline.
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NioCorp is currently trading at $0.70 (TSX.V) and has been hovering between $0.60 and $0.80 for most of the last 6 months. At the start of 2014 they were sitting at $0.15.
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About the Company: NioCorp are developing the only primary niobium deposit known to be under development in the U.S., and the highest grade undeveloped niobium deposit in North America, located near Elk Creek, Nebraska. The Company has filed an NI43-101 compliant resource report, available on SEDAR, and is in the process of filing the updated NI43-101 compliant resource estimate reported in this press release. Niobium is mainly used in the form of Ferro-Niobium to produce HSLA (High Strength, Low Alloy) steel, to produce lighter, stronger steel for use in automotive, structural and pipeline industries. The U.S. imports 100% of its niobium needs.
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