This is a difficult project, but it is being developed by a strong team that appears to recognize the hurdles ahead of it while playing it straight with investors. The metallurgical flow-sheet can be optimized, and there is a lot of room for improvement to recoveries (particularly for HREEs), estimated at 76.8%.Weld, Strange Lake, Bear Lodge, Steemkampskraal, Norra Karr, Round Top…etc.). Therefore, we view Search as an exploration story as well and note that while there may be better REE deposits out there than Foxtrot that most REE projects under consideration are found in regions that have been explored extensively and whose resources are well-known (e.g. More generally it is feasible that the Fox Harbour Volcanic Belt could host other similar deposits, making this a potential mining district. We wouldn't be surprised to see the company drill out this deposit over the next couple of years and making it the first target for exploitation. Pilot plant work, which is about to commence at SGS's laboratory in Lakefield, ON, should be applicable to Deep Water Fox ore. Nearby Deep Water Fox appears to be similar in terms of geology and mineralogy to Foxtrot, except that it is more than twice as wide and ore grades appear to be ~15% higher than they are at Foxtrot based on a preliminary analysis of surface material.Forest Service Land) or Lynas (it has to ship its mineral concentrate outside of Australia for chemical processing) will not impact Search. Search will, of course, have to comply with wishes of the locals and with normal environmental standards, but the concerns that have hindered Rare Element Resources (Bear Lodge is located on U.S. Labrador is a friendly mining jurisdiction looking to develop its fledgling mining industry.Furthermore, as an open-pit/underground operation some of the capex is delayed until underground development commences, so that initial capex, with a 25% contingency, comes in at ~$152 million. The project is small: the company is only planning to process 1,000 tonnes of ore per day.These concerns are offset by the following: The company is using an unproven hydrometallurgical recovery process that could take time to develop and optimize, while expected operating costs are subject to greater variation than they would be otherwise.Generally it will be more difficult to optimize recovery rates when one looks to extract a product from multiple mineral sources. REE-mineralogy is complex as it consists of several minerals that have not been commercially processed for their REE material.Whether Foxtrot is an exception depends on the success of a commercially untested REE-extraction procedure. We will see that the "apples-to-apples" comparison here isn't appropriate, but note that it is generally the case that low ore grade plus poor deposit geometry often lead to uneconomic projects. We note that Lynas cannot generate cash-flow with an ore grade ~10X higher than this. The ore grade is relatively low at ~1.1% TREO.Furthermore, underground resources are extremely costly to expand relative to open-pitable resources, meaning the cost/benefit of additional resource delineation is likely not favorable at current prices. The strip ratio will be very high in most years of the mine's life and average 8.5 throughout. While it is exposed at surface much of the known deposit will be mined using underground methods, which is unparalleled in the REE space. Essentially the deposit is the shape of a thick shoe insole or a banana peel positioned subvertically into the side of a rugged hill. We note the following hurdles that are specific to Search: The most advanced target-Foxtrot-contains an indicated and inferred resource sufficiently large to support production for 14 years.Īs with all REE companies Search faces challenges that go above and beyond what one typically finds in resource investing, and its Foxtrot Project is currently uneconomic at market prices and given cost assumptions made in the recent PEA. REE-mineralization consists of allanite, fergusonite, and to a lesser extent monazite, bastnaesite, chevkinite and zircon. It is located in eastern Labrador, along the Fox Harbour Volcanic Belt-a 64 km-long trend along which lies the Foxtrot deposit, as well as numerous other targets-particularly Deep Water Fox-that Search's head geologist Randy Miller believes could host attractive pockets of REE mineralization. Search Minerals ( OTCQB:SHCMF) is developing the Foxtrot REE Project. (Randy Miller, Ben Kramer-Miller, Ray Saunders at Search Minerals' Foxtrot Project) This article was originally published on Augat.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |