Peninsula Energy In Landmark Resource Upgrade To 41 Mill Lbs Of Uranium At Lance, Wyoming

Published on Tuesday June 27 2011 (AEST)-Australia

Peninsula Energy (ASX: PEN) has significantly upgraded the JORC Resource Estimate for the Lance uranium projects in Wyoming, USA, to 41.4 million pounds Uranium (U3O8).

Importantly, the Definitive Feasibility Study (DFS) incorporating the updated resource calculation is expected shortly.

The upgrade represents a 25% increase in Total Resource Estimate. There is also a 7% increase in the Measured and Indicated Resource to 11.2Mlbs U3O8. The Measured and Indicated uranium has increased to 27% of the Total Resource.

Also, the Ross Permit Area vanadium Resource has been upgraded to 2.3Mlbs vanadium V2O5.

The company has achieved this upgrade by the completion of an additional 300 drill holes since the previous upgrade in February 2011.

Gus Simpson, executive chairman, said “we are very pleased with this resource upgrade and the ongoing drill program. It continues to convert areas of mineral potential into further JORC resource and to enhance resource status from Inferred to Indicated and Measured.

This is adding significant value to the Lance project. Importantly, we will now factor this into the DFS model and publish those findings. ”

The Resource has been calculated by applying a combined constraint of a grade thickness product (GT) of 0.2 contour and 200 parts per million (ppm) U3O8.

The company considers these lower cut offs to be appropriate for both calculating and reporting of in-situ recovery (ISR) resources at the Lance Projects.

At Ross (including the Ross Permit Area) there is a now a combined Measured, Indicated and Inferred Resource of 26.2Mlbs U3O8, an increase of 19% from the updated February estimate.

Within the Ross Permit Area the combined Measured, Indicated and Inferred Resource totals 5.90Mlbs U3O8 at an average grade of 499ppm and an average GT of 0.55.

Since the previous resource estimate, drilling within the permit area has been partly designed to test the resource model by targeting the nose (high grade) portion of the roll front systems.

This drilling campaign has produced an overall increase in grade within the permit area from 478ppm to 498ppm U3O8.

Drilling outside the permit area has largely been focussed on exploration for new roll front systems and on converting inferred resource to indicated resource.

The wider-spaced exploration drilling has resulted in the overall resource grade outside the permit area marginally decreasing, however, at the same time the overall resources have increased significantly.

The Lance project covers an area of over 120 square kilometres within which there is a combined total of at least 305 line kilometres (190 miles) of known stacked roll fronts.

Of this total, only a small percentage has been explored with over 90% of the drilling concentrated within the more advanced Ross and Barber areas.

Peninsula said future in-fill drilling will be targeted at the nose (high grade) portion of the roll fronts and a general uplift in grade is anticipated.

Resource conversion and exploration drilling will continue with one rotary mud rig employed in the northern Ross area and a second rig engaged at Barber to identify additional uranium mineralisation in the area and increase the resource inventory at Barber.

On-going drilling will continue to upgrade existing Inferred Resources to Indicated or Measured Status in addition to converting the numerous areas of mineralised potential.

One drilling rig is currently dedicated to the Barber area in order to delineate sufficient mineralisation to support the planned remote ion exchange (IX) plant that will provide additional feed to the central processing plant (CCP) to be located at Ross.

Peninsula controls the majority of the surface and minerals rights in the Oshoto Region and is currently acquiring additional areas that are considered prospective for roll front style uranium mineralisation.

In February Peninsula signed a first sales agreement to supply 1.15 million pounds of uranium oxide over seven years to a Tier 1 power utility in the U.S., representing a significant milestone for the company as it will generate short term cash flows.

Peninsula has targeted 2012 to begin producing uranium from the Lance projects, and aims to become one of the largest producers of uranium in the U.S.

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Nuclear Retreat To Add 30 Percent To World Carbon Emissions

Published on Monday June 20 2011 (AEST)-Australia

A halving of a global nuclear power expansion after Japan's Fukushima disaster would increase global growth in carbon dioxide emissions by 30 percent through 2035, the IEA said on Wednesday.

The International Energy Agency warned last month that a political goal to limit climate change to safer levels was barely achievable after global emissions rose by near 6 percent in 2010.

Governments agreed last year to limit warming to less than 2 degrees above pre-industrial levels, but the world was poised to surpass that level of carbon emissions, said the energy adviser to 28 industrialized economies.

A halving of nuclear power growth would make the task even more difficult, said IEA chief economist Fatih Birol.

"We believe this huge emissions increase plus the rather bleaker perspective for nuclear power put together make the 2 degrees target very, very difficult to achieve."

"(Growth in) CO2 emissions from electricity generation between now and 2035 would be about 30 percent higher than it would otherwise be." That was equivalent to almost an extra 500 million tonnes of CO2 emissions annually by 2035, he added.

CO2 emissions rose above 30 billion tonnes last year, a new record and just short of the amount that Birol estimated was consistent with the world's new warming target.

Birol was referring to a scenario where the world added another 180 gigwatts (GW) of nuclear power between now and 2035, instead of its previous forecast of 360 gigawatts.

Such a nuclear retreat would cut the sector's share of power generation, he added. "We think this is bad news in terms of having less diversification in the global energy mix, a less secure picture," he told Reuters Energy and Climate Summit.

Coal and gas demand would increase by about 5 percent in 2035 compared with what the IEA expected before Fukushima, and renewables by 6 percent, implying upward pressure on fuel and power prices.

Governments around the world have ordered nuclear safety reviews after a March 11 quake and tsunami in Japan triggered a meltdown and radioactive release at the country's Fukushima nuclear plant.

Germany last month announced plans to shut all its nuclear reactors by 2022. Italians voted to ban nuclear energy for decades on Monday in a referendum strongly influenced by the Fukushima disaster but also a strong political vote against Prime Minister Silvio Berlusconi.

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Rare Earths Expert Dudley Kingsnorth Reflects On The Effect of Rising REE Prices

Published on Friday June 17 2011 (AEST)-Australia

Be careful what you wish for. That could be the take-home message from comments made to RareMetalBlog by Australian REE expert Dudley Kingsnorth. He says the continuation of present high prices, and especially any significant further rises, will just give greater emphasis to the need by end users to find substitutes for REE. 

After all, we have already seen the Japanese government put up funds to promote the identification and use of substitutes for REE and also to lift recycling of the elements - the whole idea being to free Japanese manufacturers from being hostages to the rare earth miners.

Kingsnorth, who runs Perth-based Industrial Minerals Co. of Australia, said that a few months ago he had forecast that, in 2015 and taken across the whole industry, REE producers would receive an average of between US$30/kg and US$40/kg rare earth oxides (REO). It is noteworthy that the figure for the first quarter of 2010 was between US$12/kg and US$15/kg REO and today it is between US$120/kg and US$150/kg REO. He adds that, when one considers that Lynas is forecasting their costs of production at US$10/kg, one can understand why many analysts are recommending Lynas as a ‘buy’ – it is a mark-up that even the iron ore miners can only dream about! Kingsnorth's latest estimates for 2015 prices is that they will probably be in the range of US$40/kg to US$60/kg REO. The recent rise of dysprosium from US$750/kg to US$1,500/kg is, in his view, unsustainable. Already the high prices are having an effect: producers are selling much lower REE quantities than they were a year ago.

He sees some of the heavy rare earth oxides being in continuing short supply, but many of the others are likely to come off by substantial amounts.

This is not to say that mining REE will be unprofitable, says Kingsnorth. Those companies that get the financing to develop REE mines will, he says, be very profitable businesses. As noted above, Lynas Corp., at its operations in Western Australia and Malaysia, has target production costs of around US$10/kg, and Molycorp at Mountain Pass, California, lower again.

However, he doesn’t think these mines will reach their full capacity for several years. Lynas is being delayed by the environmental and health enquiry in Malaysia concerning the processing plant at Gebeng, but Kingsnorth believes the Malaysians will eventually give it the green light. Molycorp now looks like commencing start up mid-2012. Until these projects reach their design capacity they will enjoy very good prices, but at reduced volumes.

He sees the current market being distorted by the Chinese system of export quotas; as a result of their scarcity there is a ‘value/price’ of approximately US$80 per kg REO quota. This is the reason why the lower priced light rare earths have increased in price by the greatest margins (more than 1,000 per cent in some cases). 

In the medium term, once Lynas and Molycorp are up to capacity Kingsnorth believes that this premium will disappear; the basis for his forecast of a fall in prices in 2014-15.

George Bauk, managing director of heavy rare earths hopeful Northern Minerals, is very wary about the recent explosive increase in prices; he believes it has the potential to stunt the growth of the industry and could lead to its demise if the current trend continues unabated.

He signalled that Northern Minerals is pressing ahead as quickly as possible, the current drilling program having been affected by heavy rains and causing the company frustration. Bauk also illustrated what he sees as the urgency by outlining how the company plans to accelerate the race to production.

“We are very conscious of the need for the rest of the world to develop its own sources of heavy rare earths as soon as possible if it is to become independent of China,” he added. “That is why we will develop any heavy rare earth resources we may identify/prove as soon practicable, if necessary without going to the ultimate value-add step of producing separated rare earths.”

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Greenland Minerals Confirms Substantial New Deposits Could Be Larger Than Kvanefjeld

Published on Wednesday June 15 2011 (AEST)-Australia

Greenland Minerals and Energy (ASX: GGG) is aiming to establish initial JORC Inferred resource estimates for three recently discovered multi-element deposits within the northern Ilimaussaq Complex in south Greenland by September.

Rod McIllree and the Greenland Minerals team are known to be especially "bullish" on the potential of the three deposits at Steenstrupfjeld, Zone 2, and Zone 3, and could be up to 15 to 20% larger than Kvanefjeld.

The Ilimaussaq Complex hosts the Kvanefjeld multi-element project, which has the world’s largest JORC rare earth Resource.

The company commenced the 2011 field program in mid-May and is focused on Resource definition drilling at the new multi-element deposits, ongoing environmental baseline studies and reconnaissance engineering studies that aim to evaluate the suitability of sites for key infrastructure items.

Two diamond drill rigs are currently operating on Zone 2 where over 2000 metres of core have been drilled to date. Upon completion of the planned drill holes at Zone 2, both drill rigs will move to the Zone 3 area located along the northeastern margin of the Ilimaussaq complex.

A third rig is scheduled to commence drilling in the Steenstrupfjeld area in the coming days, with about 15,000 metres of drilling is planned for the season.

Negotiations with local community

Stakeholder engagement programs are continuing, with a well-received open day having recently been held in the town of Qaqortoq, south Greenland.

Qaqatoq is located about 30 kilometres from the town of Narsaq where the company's operations are based.

Greenlandic stakeholders input is critical to the site selection process, along with the results from the Resource definition drilling. Significantly, the company is expecting Government environmental approvals within weeks, which would be a boost for the market value of the company.

The open day was the second by the company, and provided a comprehensive update on the Kvanefjeld project, with a strong emphasis on the feasibility studies and the environmental and social impact assessments.

The company has a good rapport with local communities and has its next open day in October.

A 619 million tonne (Mt) multi-element resource (rare earth elements, uranium, zinc) has already been defined at Kvanefjeld, which was the first focal point of resource definition within the northern Ilimaussaq project area.

With the global resource at Kvanefjeld including an inventory of 6.6 million tonnes of total rare earth oxides (TREO), the Resource definition drilling will add to the company's already impressive Resource base in Greenland.

In addition, Greenland Minerals and Energy has the potential for a funding injection on the exercise of the company's June 30 options.

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Western Australia Committed To Uranium Sector Growth

Published on Wednesday June 08 2011 (AEST)-Australia

Western Australia continues to support growing the uranium sector, Mines and Petroleum Minister Norman Moore said on Wednesday.

“The long-term outlook for uranium is positive and this is reflected by the growth of uranium exploration in Western Australia,” he said, adding that the state accounted for 44% of national exploration spending on the nuclear fuel.

Uranium exploration expenditure increased by 87% to A$84-million last year, which was the highest percentage increase in exploration for any of the major commodities in Western Australia.

The state has a known resource of more than 207 000 t of uranium oxide in about 30 separate deposits.

There are currently four projects undergoing state and federal approval in Western Australia, including BHP Billiton’s Yeelirrie project, Toro Energy’s Wiluna project, Mega Uranium’s Lake Maitland and the Cameco/Mitsubishi venture’s Kintyre project.

“I believe we will continue to see incredible growth in Western Australia’s burgeoning uranium sector and that uranium mining will be world class when it commences in the next few years.”

Moore acknowledged that there were some community concerns surrounding uranium mining and transportation in Western Australia and stressed the importance of having systems and regulations in place to ensure the safe operation of the industry.

“I am confident those systems are in place. It is also important to acknowledge that Western Australia has effectively regulated radioactive substances stemming from mineral sands and tantalum mining for more than 40 years. This includes the transportation of product, the management of radioactive waste and the export of radioactive materials,” he said.

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China Shakes Up Rare Earth Industry

Published on Monday June 06 2011 (AEST)-Australia

Mike Elliot, global mining & metals leader at Ernst & Young, believes Beijing's move to consolidate the rare earth sector and the creation of the new Baotou exchange in Mongolia will directly impact exports and prices of the mineral.

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Energy Ventures Intersects Significant Uranium At Shallow Depths In Oregon

Published on Thursday June 02 2011 (AEST)-Australia

Australian ASX Listed Energy Ventures (EVE) has confirmed the Aurora Uranium deposit contains significant near-surface uranium mineralisation that may be amenable to exploitation through shallow open-pit mining.

The confirmation comes from results obtained from further chemical assays for six diamond drill holes at the Aurora uranium project in southeast Oregon, USA.

Significant intersections from the higher grade parts of the resource include 40.2 metres at 672 parts per million (ppm) uranium (U3O8) from 57.6 metres and 19.2 metres at 1161 ppm U3O8 from 57.6 metres.

Drilling of the initial 16 hole program has been completed and further assay results are pending for six holes and will be available prior to the end of the second quarter of 2011.

The company said assay results confirm the general geological interpretation of the Aurora deposit "as a series of broad, flat-lying, tabular zones of mineralisation that locally contain higher grade lenses of uranium mineralisation controlled by lithological variations in the host volcanic rock package."

Importantly, these near surface zones appear to be amenable to exploitation by shallow open pit mining.

Energy Ventures is currently undertaking feasibility studies to assess the economics of establishing a mine and process plant infrastructure at the site.

The results will be used by the company to assist with sample selection for a metallurgical testing program and to undertake a review of the resource estimate for the deposit.

The Aurora uranium deposit has a total resource base of 38 million pounds (Mlb) eU3O8 comprising an Indicated Resource of 36.7 Mlb eU3O8 at a grade of 253 ppm eU3O8, and an Inferred Resource of 1.2 Mlb eU3O8 at a grade of 151 ppm eU3O8 (grade cut-off 100 ppm eU3O8).

Once all assays are received the company will be able to review the resource for the deposit and potentially upgrade some of the resource to the Measured category.

Progress on the Aurora project and the company’s other exploration projects in the western USA has not been significantly impacted by the Japan tsunami, though there has been a re-rating of uranium stocks by the market post the nuclear accident at Fukushima.

Energy Ventures has cash reserves and liquid investments that will allow the company to continue with its strategy of advancing its technical projects toward development, increasing the overall resource base and demonstrating value.

The comapany's ultimate aim is to supply product to the domestic US market, which is the largest consumer of uranium in the world and is expected to have consistent demand in the longer term.

Pound for pound, Energy Ventures' resource base is significantly undervalued in relation to peer companies in terms of market value.

Mineral Resource

The Resource estimate for the Aurora deposit has outlined an Indicated Resource of 65.7 Mt @ 253 ppm eU3O8 (36.7 Mlb eU3O8) and an Inferred Resource of 3.6 Mt @ 151 ppm eU3O8 (1.2 Mlb eU3O8). This resource represents a total of 38 Mlb eU3O8.

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