DNI consolidates and expands Buckton Resource to 3.49 billion tons
on its Alberta polymetallic black shale project
(DNI : TSX-Ven)
(DG7 : Frankfurt)
TORONTO,
Jan. 11, 2013 /CNW/ - DNI Metals
Inc. (DNI:TSX-Ven)(DG7:FSE) announces results of its NI-43-101
compliant resource study just completed which consolidates, updates
and expands the inferred mineral resource at its Buckton Zone on
its Alberta polymetallic black
shale project. The Consolidated and Updated Buckton Mineral
Resource Study (the "Resource Study") successfully expands the
inferred resource at the Buckton Zone to 3.49 billion short tons.
This resource extends over approximately 14 square kilometres, and
is hosted in two near-surface stacked black shale horizons which
are mineralized with recoverable Mo-Ni-U-V-Zn-Co-Cu-Li-REEs-Y-Th-Sc
and are partly exposed on surface. The Buckton Zone is one of six
mineralized systems, or zones, identified on DNI's 2,720 square
kilometre Property in northeast Alberta.
The inferred resource being announced is based
on a US$10/tonne base cut-off and
represents all mineralized tonnages that are under less than 75m of
overburden cover, consisting of an upper, lower-grade, horizon
hosted in Labiche Formation, which directly overlies a
higher-grading horizon hosted in Second White Speckled Shale
Formation. The two Formations together comprise a wedge of
mineralized black shale, ranging approximately 13m-140m thick,
extending westward from the point where they are exposed on surface
along the eastern erosional edge of the Birch Mountains to a point
where overburden cover above the uppermost resource blocks in the
Labiche shale thickens to more than 75m.
The Resource Study consolidates all previous
resource estimates from the Buckton Zone using more current metal
prices and a higher base cut-off per recommendations of previous
studies. This resource study, accordingly, supersedes and replaces
all prior resource estimates announced in 2011-2012 from the Zone
(DNI press October 24, 2011,
January 16, 2012, and September 12, 2012). The study will be revised
again in early 2013 to incorporate results from DNI's 2012 drilling
to further expand the resource in preparation for a Preliminary
Economic Analysis (Scoping Study) of the Zone.
The Consolidated and Updated Buckton Mineral
Resource Study was prepared by Apex Geoscience Ltd ("Apex"),
Edmonton, under the supervision of
Mr.Roy Eccles PGeol, Mr.Michael Dufresne PGeol and Mr.Steven Nicholls MAIG, who are the Qualified
Persons in connection with its preparation and are independent of
DNI. The Study relies on DNI's 2010-2011 winter drilling over the
Buckton Zone, together with historic drilling from the area from
which all archived drill core were previously re-sampled and
re-analyzed by DNI in 2009 and 2012. All of the foregoing drilling
campaigns were implemented by Apex under the supervision of
Mr.Dufresne. The Consolidated and Updated Buckton Mineral Resource
Study complies with National Instrument 43-101 and CIM resource
estimation guidelines.
This press release is a summary of salient
conclusions from the Consolidated and Updated Buckton Mineral
Resource Study report which is being filed to SEDAR and will be
available shortly. The report, "National Instrument 43-101
Technical Report, Consolidated And Updated Inferred Resource
Estimate For The Buckton Zone, SBH Property, Northeast Alberta", with effective date of
January 9, 2013, will also be
available from DNI's website www.dnimetals.com once it is
filed.
The Consolidated and Updated Buckton Mineral
Resource is classified as an inferred resource consisting of
3,485,011,000 short tons (3,161,549,000 metric tonnes) of
mineralized black shale extending over 14 square kilometres beneath
less than 75m of overburden cover. This resource is hosted in the
Labiche Formation and underlying Second White Speckled Shale
Formation, which are two flat-lying black shale Formations that are
stacked to comprise a continuous thick zone of mineralized shale.
The inferred resource is mineralized with recoverable Molybdenum
(Mo), Nickel (Ni), Uranium (U), Vanadium (V), Zinc (Zn), Copper
(Cu), Cobalt (Co), Lithium (Li), Scandium (Sc), Thorium (Th) and
Rare Earth Elements Lanthanum (La), Cerium (Ce), Praseodymium (Pr),
Neodymium (Nd), Samarium (Sm), Europium (Eu), Gadolinium (Gd),
Terbium (Tb), Dysprosium (Dy), Yttrium (Y). The Study estimates
that the inferred resource is overlain by 738,729,000 short tons
(670,164,000 metric tonnes) of glacial till overburden.
The inferred resource reported by the
Consolidated and Updated Buckton Mineral Resource Study is
tabulated below combining the Upper and Lower Zones on a weighted
basis.
Consolidated and
Updated Buckton Inferred Mineral Resource
Upper (Labiche Formation) and Lower (Second White Speckled
Shale) Zones Combined |
Mineralized Shale (tons) |
3,485,011,000 |
|
MoO3 |
Ni |
U3O8 |
V2O5 |
Zn |
Cu |
Co |
Li2CO3 |
Raw Grade (ppm) |
25.4 |
68.6 |
11.7 |
616.5 |
175.9 |
40.4 |
14.7 |
378.8 |
Recoverable Grade (ppm) |
12.8 |
57.9 |
9.9 |
141.0 |
141.5 |
25.5 |
12.3 |
158.0 |
Metal/Oxide Price* (US$/lb) |
17.63 |
9.07 |
68.99 |
7.67 |
0.90 |
3.29 |
22.39 |
2.68 |
Recoverable metal/oxide (kg) |
40,529,000 |
183,032,000 |
31,224,000 |
445,733,000 |
447,367,000 |
80,530,000 |
38,757,000 |
499,397,000 |
Recoverable metal/oxide (lbs) |
89,351,000 |
403,516,000 |
68,837,000 |
982,672,000 |
986,274,000 |
177,538,000 |
85,444,000 |
1,100,981,000 |
|
|
La2O3 |
Ce2O3 |
Pr2O3 |
Nd2O3 |
Sm2O3 |
Eu2O3 |
Gd2O3 |
Tb2O3 |
Raw Grade (ppm) |
48.9 |
85.3 |
10.5 |
40.6 |
7.9 |
1.6 |
6.7 |
1.0 |
Recovery % |
29 |
36 |
39 |
45 |
61 |
63 |
69 |
70 |
Recoverable Grade (ppm) |
14.4 |
30.7 |
4.1 |
18.1 |
4.8 |
1.0 |
4.6 |
0.7 |
Metal/Oxide Prices** US$/kg) |
42.84 |
47.40 |
114.98 |
128.61 |
58.66 |
1,872.65 |
83.70 |
1,551.08 |
Recoverable Oxide (kg) |
45,371,000 |
96,967,000 |
13,014,000 |
57,268,000 |
15,038,000 |
3,270,000 |
14,420,000 |
2,237,000 |
Recoverable Oxide (lbs) |
100,026,000 |
213,775,000 |
28,691,000 |
126,254,000 |
33,153,000 |
7,209,000 |
31,791,000 |
4,932,000 |
|
|
|
|
|
|
|
|
|
|
Dy2O3 |
Ho2O3 |
Er2O3 |
Tm2O3 |
Yb2O3 |
Lu2O3 |
Y2O3 |
Sc2O3 |
ThO2 |
Raw Grade (ppm) |
5.8 |
1.2 |
3.4 |
0.5 |
3.4 |
0.6 |
39.4 |
22.4 |
12.0 |
Recovery % |
69 |
58 |
62 |
60 |
53 |
50 |
67 |
34 |
40 |
Recoverable Grade (ppm) |
4.0 |
0.7 |
2.1 |
0.3 |
1.8 |
0.3 |
26.3 |
7.7 |
4.8 |
Metal/Oxide Prices** US$/kg) |
864.09 |
205.82 |
197.35 |
$97.00 |
100.63 |
1,024.09 |
81.73 |
3,881.39 |
252.00 |
Recoverable Oxide (kg) |
12,742,000 |
2,353,000 |
6,624,000 |
916,000 |
5,742,000 |
1,053,000 |
83,095,000 |
24,220,000 |
15,146,000 |
Recoverable Oxide (lbs) |
28,091,000 |
5,187,000 |
14,603,000 |
2,019,000 |
12,659,000 |
2,321,000 |
183,193,000 |
53,396,000 |
33,391,000 |
*Metal/Oxide
commodity prices used to establish bulk recoverable values for
cut-off grade thresholding tests are the five year trailing average
to Oct/2012.
**Metal/Oxide commodity prices used to establish bulk
recoverable values for cut-off grade thresholding tests are the
three year trailing average to Oct/2012 for La Ce Pr Nd Sm Eu Gd Tb
Dy Y; three year trailing average to Aug/2011 for Tm; Th per
USGS Mineral Commodity Summaries 2009-2011, the two year
trailing average to Oct/2012 for Ho Er Yb Lu Sc. Metal prices vary
among various commodity information sources and, in all conflicting
instances, the lower pricing was used. The 2011 drilling
included an appropriate number of analytical standards, blanks and
duplicates, and no analytical issues were identified. Re-analysis
of historic drill core included an appropriate number of analytical
standards, blanks and duplicates, and no analytical issues were
identified. ton=short ton; lb=pound; kg=Kilogram; Recoverable
metal/oxide stated to nearest 1000kg or 1000lb. Figures may not add
exactly due to rounding. |
Mineral resources are not mineral reserves
and do not have demonstrated economic viability. There is no
guarantee that all or any part of the mineral resource reported
herein will be converted into a mineral reserve. An 'Inferred
Mineral Resource' is that part of a Mineral Resource for which
quantity and grade or quality can be estimated on the basis of
geological evidence and limited sampling and reasonably assumed,
but not verified, geological and grade continuity. The estimate is
based on limited information and sampling gathered through
appropriate techniques from locations such as outcrops, trenches,
pits, workings and drill holes. The metal recoveries reported
represent preliminary mineral recovery testing results collated
from the collective bench scale laboratory testwork completed by
DNI to date and may not reflect actual process recoverability that
might be achieved in a mineral production operation, all of which
is the subject of ongoing studies.
This Consolidated and Updated Buckton Mineral
Resource has been classified as an inferred resource according to
CIM standards, based on a number of factors, namely; limited number
of drill holes and their wide spacing, good continuity of
mineralization and geological control between drill holes and from
section to section along approximately six kilometres of strike.
The inferred resource is open to the north, northeast and south,
and eastward to the erosional edge of the Birch Mountains over a
large area with thin overburden cover where mineralization
intermittently outcrops at surface or is intermittently exposed
throughout several kilometres of valley walls.
The Resource Study concludes that the
Consolidated and Updated Buckton mineral resource is mineralization
which has a reasonable prospect for extraction in the future. This
resource comprises all Labiche and Second White Speckled Shale
resource blocks which are beneath less than 75m of overburden
cover, and for which the combined gross value of recoverable
contained Mo-Ni-U-V-Zn-Co-Cu-Li-REEs-Y-Th-Sc exceeds the base
cut-off of US$10 per tonne relying on
the best achieved metals recoveries as reported from the collective
of DNI's leaching testwork. Metal prices used are the trailing 2yr,
3yr and 5yr year commodity price averages as tabulated below. The
inferred resource is distributed between the Upper and Lower zones
as follows (also tabulated separately below):
(a) 2.7 billion short tons (2.5 billion
metric tonnes) in the Upper, lower grade, zone hosted in the
Labiche Formation ranging 13m-115m in thickness (ultimate thickness
of the Labiche Shale at the Property is unknown as near-surface
portions of it have been locally scoured away by glaciation). Most
of this tonnage was previously reported in the Buckton Labiche
Resource Study announced September 12,
2012; and
(b) 747 million short tons (678 million
metric tonnes) in the Lower, higher grade, zone hosted in the
Second White Speckled Shale Formation ranging 13m-23m in thickness.
A 250 million short ton portion of this tonnage was previously
reported as the Buckton Initial Maiden Resource in the Buckton
Maiden Resource Study and the Buckton Supplementary REE-Y-Sc-Th
Resource Study announced October 24,
2011, and January 16, 2012,
respectively. The Consolidated and Updated Buckton Mineral Resource
Study expands the resource in the Second White Speckled Shale
Formation to include additional tonnages of mineralization
surrounding the Buckton Maiden resource beneath the Labiche
Formation, which were previously excluded from being classified as
a resource due to excessive thickness of overlying Labiche cover
where the Labiche was previously believed to be waste but was
subsequently demonstrated to be a mineral resource in its own
right.
Consolidated and
Updated Buckton Inferred Mineral Resource
Upper Zone Portion - in Labiche Formation |
Mineralized Shale (tons) |
2,737,641,000 |
|
MoO3 |
Ni |
U3O8 |
V2O5 |
Zn |
Cu |
Co |
Li2CO3 |
Raw Grade (ppm) |
2.9 |
49.2 |
5.2 |
448.2 |
142.8 |
30.8 |
12.7 |
400.3 |
Recovery % |
55% |
80% |
75% |
10% |
75% |
65% |
80% |
40% |
Recoverable Grade (ppm) |
1.6 |
39.3 |
3.9 |
44.8 |
107.1 |
20.0 |
10.2 |
160.1 |
Metal/Oxide Price* (US$/lb) |
17.63 |
9.07 |
68.99 |
7.67 |
0.90 |
3.29 |
22.39 |
2.68 |
Recoverable metal/oxide (kg) |
4,014,000 |
97,674,000 |
9,655,000 |
111,312,000 |
265,982,000 |
49,751,000 |
25,232,000 |
397,618,000 |
Recoverable metal/oxide (lbs) |
8,849,000 |
215,334,000 |
21,286,000 |
245,401,000 |
586,389,000 |
109,682,000 |
55,627,000 |
876,597,000 |
|
|
La2O3 |
Ce2O3 |
Pr2O3 |
Nd2O3 |
Sm2O3 |
Eu2O3 |
Gd2O3 |
Tb2O3 |
Raw Grade (ppm) |
46.0 |
82.2 |
9.8 |
37.4 |
7.2 |
1.5 |
5.8 |
0.9 |
Recovery % |
15% |
25% |
30% |
35% |
50% |
55% |
60% |
60% |
Recoverable Grade (ppm) |
6.9 |
20.6 |
2.9 |
13.1 |
3.6 |
0.8 |
3.5 |
0.5 |
Metal/Oxide Prices** US$/kg) |
42.84 |
47.40 |
114.98 |
128.61 |
58.66 |
1,872.65 |
83.70 |
1,551.08 |
Recoverable Oxide (kg) |
17,140,000 |
51,056,000 |
7,311,000 |
32,516,000 |
8,984,000 |
2,023,000 |
8,657,000 |
1,341,000 |
Recoverable Oxide (lb) |
37,787,000 |
112,559,000 |
16,118,000 |
71,685,000 |
19,806,000 |
4,460,000 |
19,085,000 |
2,956,000 |
|
|
|
|
|
|
|
|
|
|
Dy2O3 |
Ho2O3 |
Er2O3 |
Tm2O3 |
Yb2O3 |
Lu2O3 |
Y2O3 |
Sc2O3 |
ThO2 |
Raw Grade (ppm) |
5.1 |
1.0 |
3.0 |
0.5 |
3.1 |
0.5 |
33.3 |
23.8 |
12.2 |
Recovery % |
60% |
60% |
50% |
50% |
45% |
55% |
55% |
30% |
30% |
Recoverable Grade (ppm) |
3.1 |
0.6 |
1.5 |
0.2 |
1.4 |
0.3 |
18.3 |
7.2 |
3.6 |
Metal/Oxide Prices** US$/kg) |
864.09 |
205.82 |
197.35 |
$97.00 |
100.63 |
1,024.09 |
81.73 |
3,881.39 |
252.00 |
Recoverable Oxide (kg) |
7,633,000 |
1,519,000 |
3,778,000 |
570,000 |
3,479,000 |
699,000 |
45,516,000 |
17,769,000 |
9,059,000 |
Recoverable Oxide (lb) |
16,828,000 |
3,349,000 |
8,329,000 |
1,257,000 |
7,670,000 |
1,541,000 |
100,345,000 |
39,174,000 |
19,972,000 |
*Metal/Oxide
commodity prices used to establish bulk recoverable values for
cut-off grade thresholding tests are the five year trailing average
to Oct/2012.
**Metal/Oxide commodity prices used to establish bulk
recoverable values for cut-off grade thresholding tests are the
three year trailing average to Oct/2012 for La Ce Pr Nd Sm Eu Gd Tb
Dy Y; three year trailing average to Aug/2011 for Tm; Th per
USGS Mineral Commodity Summaries 2009-2011, the two year
trailing average to Oct/2012 for Ho Er Yb Lu Sc. Metal prices vary
among various commodity information sources and, in all conflicting
instances, the lower pricing was used. The 2011 drilling
included an appropriate number of analytical standards, blanks and
duplicates, and no analytical issues were identified. Re-analysis
of historic drill core included an appropriate number of analytical
standards, blanks and duplicates, and no analytical issues were
identified. ton=short ton; lb=pound; kg=Kilogram; Recoverable
metal/oxide stated to nearest 1000kg or 1000lb. Figures may not add
exactly due to rounding.. |
Consolidated and
Updated Buckton Inferred Mineral Resource
Lower Zone Portion - in Second White Speckled Shale
Formation |
Mineralized Shale (tons) |
747,370,000 |
|
MoO3 |
Ni |
U3O8 |
V2O5 |
Zn |
Cu |
Co |
Li2CO3 |
Raw Grade (ppm) |
107.7 |
139.9 |
35.3 |
1233.1 |
297.3 |
75.7 |
22.2 |
300.2 |
Recovery % |
50% |
90% |
90% |
40% |
90% |
60% |
90% |
50% |
Recoverable Grade (ppm) |
53.9 |
125.9 |
31.8 |
493.2 |
267.5 |
45.4 |
19.9 |
150.1 |
Metal/Oxide Price* (US$/lb) |
17.63 |
9.07 |
68.99 |
7.67 |
0.90 |
3.29 |
22.39 |
2.68 |
Recoverable metal/oxide (kg) |
36,515,000 |
85,358,000 |
21,569,000 |
334,421,000 |
181,385,000 |
30,779,000 |
13,525,000 |
101,779,000 |
Recoverable metal/oxide (lbs) |
80,502,000 |
188,182,000 |
47,551,000 |
737,271,000 |
399,885,000 |
67,856,000 |
29,817,000 |
224,384,000 |
|
|
La2O3 |
Ce2O3 |
Pr2O3 |
Nd2O3 |
Sm2O3 |
Eu2O3 |
Gd2O3 |
Tb2O3 |
Raw Grade (ppm) |
59.5 |
96.7 |
12.9 |
52.2 |
10.5 |
2.2 |
10.0 |
1.5 |
Recovery % |
70% |
70% |
65% |
70% |
85% |
85% |
85% |
90% |
Recoverable Grade (ppm) |
41.6 |
67.7 |
8.4 |
36.5 |
8.9 |
1.8 |
8.5 |
1.3 |
Metal/Oxide Prices** US$/kg) |
42.84 |
47.40 |
114.98 |
128.61 |
58.66 |
1,872.65 |
83.70 |
1,551.08 |
Recoverable Oxide (kg) |
28,231,000 |
45,911,000 |
5,703,000 |
24,752,000 |
6,054,000 |
1,247,000 |
5,763,000 |
897,000 |
Recoverable Oxide (lb) |
62,239,000 |
101,216,000 |
12,573,000 |
54,569,000 |
13,347,000 |
2,749,000 |
12,705,000 |
1,978,000 |
|
|
|
|
|
|
|
|
|
|
Dy2O3 |
Ho2O3 |
Er2O3 |
Tm2O3 |
Yb2O3 |
Lu2O3 |
Y2O3 |
Sc2O3 |
ThO2 |
Raw Grade (ppm) |
8.4 |
1.6 |
4.7 |
0.7 |
4.5 |
0.7 |
61.6 |
17.3 |
11.2 |
Recovery % |
90% |
75% |
90% |
75% |
75% |
75% |
90% |
55% |
80% |
Recoverable Grade (ppm) |
7.5 |
1.2 |
4.2 |
0.5 |
3.3 |
0.5 |
55.4 |
9.5 |
9.0 |
Metal/Oxide Prices** US$/kg) |
864.09 |
205.82 |
197.35 |
$97.00 |
100.63 |
1,024.09 |
81.73 |
3,881.39 |
252.00 |
Recoverable Oxide (kg) |
5,109,000 |
834,000 |
2,847,000 |
346,000 |
2,263,000 |
354,000 |
37,578,000 |
6,451,000 |
6,087,000 |
Recoverable Oxide (lb) |
11,263,000 |
1,839,000 |
6,277,000 |
763,000 |
4,989,000 |
780,000 |
82,845,000 |
14,222,000 |
13,420,000 |
*Metal/Oxide
commodity prices used to establish bulk recoverable values for
cut-off grade thresholding tests are the five year trailing average
to Oct/2012.
**Metal/Oxide commodity prices used to establish bulk
recoverable values for cut-off grade thresholding tests are the
three year trailing average to Oct/2012 for La Ce Pr Nd Sm Eu Gd Tb
Dy Y; three year trailing average to Aug/2011 for Tm; Th per
USGS Mineral Commodity Summaries 2009-2011, the two year
trailing average to Oct/2012 for Ho Er Yb Lu Sc. Metal prices vary
among various commodity information sources and, in all conflicting
instances, the lower pricing was used. The 2011 drilling
included an appropriate number of analytical standards, blanks and
duplicates, and no analytical issues were identified. Re-analysis
of historic drill core included an appropriate number of analytical
standards, blanks and duplicates, and no analytical issues were
identified. ton=short ton; lb=pound; kg=Kilogram; Recoverable
metal/oxide stated to nearest 1000kg or 1000lb. Figures may not add
exactly due to rounding. |
Modelling and estimation of the Consolidated and
Updated Buckton inferred resource was carried out using
3-dimensional block model based on geostatistical applications
using commercial mine planning software MICROMINE (v12.5.4). The
model relies on an aggregate of eleven vertical core holes
distributed over an area of approximately 15.8 square kilometres,
and spaced approximately 240m-2500m apart (averaging 1000m), and
was generated using the combined drill hole data derived from
drilling campaigns conducted in 1997 (6 holes) and 2011 (5 holes).
There were 5 drill lines in the MICROMINE model that ranged in
spacing from 670 m to 2 km between sections. Approximately 88% of
the mineralized black shale within the foregoing area lies beneath
less than 75m of overburden till and meet cut-off threshold
criteria for classification as an inferred resource. The
mineralized black shale in the area also shows good lateral
uniformity for many of the contained metals over large distances
across the Property. The spacing and number of holes are considered
sufficient for the determination of inferred resources, and
extrapolation of grades between the drill holes is supported by
statistical variography examined during the Study.
Considering that leaching tests completed by DNI
to date on samples from the Labiche and Second White Speckled Shale
formations report different recoveries for the metals of interest,
the resource modelling treated the two shale units separately.
According to the foregoing scheme, the Buckton Zone assay file was
composited using MICROMINE into separate sub-domains where the
analytical data were assigned to composite sample files comprising:
269 composite samples for the Labiche sub-domain (at 2.2m
intervals), 302 composite samples for the Second White Speckled
Shale REE-Y-Sc-Th sub-domain (at 0.5m intervals); and 197 composite
samples for the Second White Speckled Shale polymetallic sub-domain
(at 1m intervals).
Variography was conducted on the composited
drill hole data within the Labiche and Second White Speckled Shale
domains to produce spherical semivariogram's. Each element was
modeled individually to determine the continuity and orientation of
mineralization. As a result of the wide hole spacing a parent model
block size of 250 m x 250 m x 2 m was chosen for the resource
estimate. The block model extents were extended far enough past the
mineralized wireframe to encompass the entire domain. The
recoverable grades for the metals were translated into a US$ value
for each block and sub-block relying on the best metals recoveries
achieved per DNI's leaching tests and trailing average metal/oxide
prices as noted in footnotes to the above tables, and the values
were aggregated into a collective gross recoverable value for each
block and sub-block to enable testing against a block value base
case cut-off of US$10 per tonne.
While the collective work from the Buckton Zone
indicate that none of the metals present in the Buckton Zone occurs
in sufficiently high enough concentration to be of economic merit
by itself, the metals of interest collectively represent sufficient
recoverable gross value on a combined basis to place the resources
identified at the Buckton Zone within reach of economic viability
provided the metals are efficiently recovered on a combined basis.
DNI's leaching testwork has already demonstrated that the metals
can be collectively extracted from the shale but clear
communication of overall bulk grade has been a challenge
considering the polymetallic nature of the mineralization of merit.
In the foregoing regard, the Resource Study notes, with concurrence
from DNI, that given the absence of a single metal to represent
bulk of the overall recoverable value of the mineralized shale,
reporting of its overall grade as a traditional "metal equivalent"
would be arbitrary and misleading.
Of necessity, the Resource Study has,
accordingly, opted instead to communicate overall grade by
aggregating the individual gross recoverable values represented by
each of the metals of interest into a single gross recoverable
total per tonne value to characterize the resource and enable its
discussion and testing against a base cut-off for the purposes of
resource estimation. The reader is cautioned that disclosure of
gross values discussed in this announcement and in the Resource
Study does not comply with Section 2.3(1c) of National Instrument
43-101 since the figures are gross and the term may be misleading
in the absence of proven production costs. The recoverable
gross values are quoted for convenience of communicating overall
grade and are otherwise conceptual in nature and do not represent
economic worth of the resource being reported from the Buckton
Zone. The reader is also reminded that the values are based on
recoverable metal grades per bench scale leaching tests and do not
imply that economic viability of the recoveries has been determined
and they may not reflect actual recoveries which might be achieved
in an ultimate mineral production operation.
Polymetallic black shale is an emerging deposit
type which has gained recognition over the past decade mainly due
to advances in application of bioleaching procedures to extract low
grade metals from shale by bulk-heap leaching. Worldwide, there is
one active mining operation extracting polymetals via
bio-heapleaching and two other scoping stage projects that are
exploring/developing polymetallic deposits in black shale. These
operations provide the only resource estimation and operating cost
guidelines, particularly with respect to base cut-off values, that
are relevant to evaluating the mineral resource hosted in the
Buckton Zone.
The US$10 per
tonne base cut-off used by the Resource Study is considered to be a
reasonable benchmark which is higher than cut-offs utilized by
recent mineral resource estimates and a scoping study for other
open pit mineable poly-metallic black shales in Sweden and Finland as the break-even point and lower
cut-off. This base cut-off incorporates operating costs from the
only available operation worldwide of bulk mining and
bioheapleaching exploitation of a polymetallic black shale deposit,
and includes a nominal cost for refining of REEs into final
saleable final products relying on estimates from other REE
projects. Considering a scenario of possible open pit mining in
northeast Alberta along the
eastern edge of the Birch Mountains, with potential for a low strip
ratio at startup, the likely free-dig nature of the poorly
consolidated shale bedrock, the potential for easy access to
multiple working faces, the location of the project with respect to
access, power and other important infrastructure, the US$10 per tonne base lower cut-off value is
considered reasonable for the purposes of mineral resource
estimation as a base case cut-off threshold which also captures a
relatively continuous mineralized zone with favourable bulk mining
configuration.
DNI's leaching testwork demonstrated that the
Buckton Zone mineralization is recoverable by a single bulk
leaching method from the shale and that REEs and Specialty Metals
are incidentally leached from the shale as co-products of leaching
of base metals. The Resource Study notes that REEs account for a
significant proportion of the recoverable gross value of the
resource, especially for Upper zone mineralization in the Labiche
shale, and concludes that ultimate economics of the resource are,
accordingly, subject to uncertainties of long term REE pricing and
viability of demand, the unknown effect of new production on REE
markets; and the cost of separating REEs from pregnant leaching
solutions once they have been leached from the shale and their
refinement into saleable final products. Although the base cut-off
of US$10 per tonne used in the
Resource Study includes a nominal cost for separation of REEs
relying on estimates from other REE projects, a sensitivity
analysis was conducted in the Resource Study to investigate
sensitivity of the inferred resource to cost fluctuations by
testing the resource model against progressively higher arbitrary
base cut-offs.
The resource model was iterated and tested at
progressively higher arbitrary base cut-offs to determine the
commensurate tonnages that can be classified as mineral resources
against any given base cut-off. The entire shale package resource
model was, accordingly, tested at base cut-offs of US$12, US$14,
US$16, US$16.5 and US$17
per tonne. The sensitivity analysis demonstrated that the tonnage
and distribution of the shale package is virtually intact between
base cut-offs of US$10 per tonne and
approximately US$16 per tonne, and
that the aggregate gross recoverable value of contained metals
exceeds the base cut-off, but that at higher base cut-offs the
tonnage of the Upper zone hosted in the Labiche shale rapidly
decreases and distribution of resource blocks lose cohesion such
that at a base cut-off of US$17 per
tonne virtually none of the Upper zone in Labiche shale can be
classified as a mineral resource since aggregate gross recoverable
value of the contained metals is less than the cut-off.
The sensitivity analysis successfully
demonstrates that as the spatial distribution of the Labiche
resource decreases, progressively larger portions of Labiche would
be regarded as cover waste material to be removed for the purposes
of any mining operations to extract the underlying resource in the
Second White Speckled Shale Formation. Considering that
distribution of the Upper zone hosted in Labiche shale will affect
distribution and tonnage of what might be realistically mined from
the underlying Lower zone resource hosted in the Second White
Speckled Shale, the resource model was tested at yet higher base
cut-offs of US$30, US$40, US$50,
US$60, US$70 and US$80 per
tonne, to simulate a scenario for which the Upper zone hosted in
Labiche shale is deemed to be waste and would have to be removed
together with the overburden to gain access to the underlying
higher grade mineralization in the Second White Speckled Shale. In
these iterative scenarios, the Lower zone in the Speckled Shale is
the only mineralization of interest and the resource identified
within it remains intact between base cut-offs of US$10 per tonne and US$40 per tonne at which cut-off it comprises 265
million short tons (241 million metric tonnes) extending over 5.8
square kilometres and is similar in distribution and tonnage to the
Buckton Maiden Resource announced on October
24, 2011. The resource gradually loses cohesion at base
cut-offs higher than US$40 per tonne
such that at a base cut-off of US$70
per tonne virtually none of it can be classified as a mineral
resource since the aggregate gross recoverable value of contained
metals is less than the base cut-off.
The Resource Study overall concludes that the
per tonne of recoverable gross value represented by the Labiche and
Second White Speckled Shale resource is sufficiently higher than
the US$10 per tonne base cut-off used
by the Resource Study, and sufficiently higher than the related
iteration of the resource model at higher cut-offs up to
US$16 per tonne, to reasonably
conclude that the Consolidated and Updated Buckton mineral resource
is mineralization that has a reasonable prospect for extraction in
the future.
The Resource Study concludes that the inferred
resource announced herein at the Buckton Zone has excellent
potential for expansion with further drilling, and recommends
implementation of additional exploration at the Buckton Zone, and
the Property, to include additional leaching testwork (ongoing) and
additional drilling to continue expanding and upgrading the Buckton
Zone resource hosted within the Labiche as well as the Second White
Speckled Shale Formations. The Resource Study supports DNI's
decision to advance the Buckton Zone toward the Preliminary
Economic Assessment study (Scoping Study) which is in progress. The
Study also recommends that resources reported herein at the Buckton
Zone be revised to incorporate results from DNI's 2012 drilling
program.
The Qualified Persons in connection with the
preparation of the Consolidated and Updated Buckton Mineral
Resource Study are Mr. Roy Eccles PGeol, Mr. Michael Dufresne PGeol
and Mr. Steven Nicholls MAIG who are independent of DNI. The
Qualified Person in connection with this press release and in
respect of the Alberta
polymetallic black shale projects is Mr. Shahé F.Sabag PGeo,
President and CEO of DNI, who is responsible for verification and
quality assurance of the exploration information disclosed in
connection with the projects and this release.
Ton=short ton; lb=pound; tonne = metric tonne =
1000kg. The 2011 drill core analyses and re-analysis of historic
Labiche drill core intercepts included an appropriate number of
analytical standards, blanks and duplicates, and no analytical
issues were identified. Metal/Oxide commodity prices used to
establish bulk recoverable values for cut-off grade thresholding
tests are the five year trailing average to October 25, 2012, for Mo-Ni-U-V-Zn-Cu-Co-Li (U
consolidated from www.cameco.com; Li from www.asianmetal.com;
remaining metals from www.metal-pages.com); the three year trailing
average to October 25, 2012, for;
La-Ce-Pr-Nd-Sm-Eu-Gd-Tb-Dy-Y (consolidated from
www.metal-pages.com); three year trailing average to August, 2011,
for Tm (from Montviel Core Zone REE resources study 2011 by SGS
Canada Inc.); Th per USGS Mineral Commodity Summaries
2009-2011, the two year trailing average to October 25, 2012, for Ho-Er-Yb-Lu-Sc
(consolidated from www.asianmetal.com). Metal prices vary among
various commodity information sources and in all conflicting
instances the lower pricing was used.
Analyses by Activation Laboratories Ltd.,
Ancaster, ON; Analytical results
from the 2011 drilling were announced on Jul15/2011, along with
details of DNI's analytical quality assurance and quality control
parameters. Additional REE and Specialty Metals grades were
announced on Dec2/2011. Archived drill core from some of the
historic drilling was examined, re-sampled and re-analyzed by DNI
as part of its verification sampling program in 2008-2009. All
samples from 2011 drilling were re-analyzed for REEs in
December 2011 by Activation Labs,
Ancaster, ON, by Fusion and Trace
Element Fusion ICP (Code 8). Labiche Formation intercepts from
archived historic 1997 drill core were re-sampled and re-analyzed
by Activation Labs, Ancaster, ON,
by Fusion and Trace Element Fusion ICP (Code 8) for
consistency with DNI's more recent data.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
DNI - TSX Venture
DG7 - Frankfurt
Issued: 74,857,022
We seek Safe Harbour. This announcement
includes forward looking statements. While these statements
represent DNI's best current judgment, they are subject to risks
and uncertainties that could cause actual results to vary,
including risk factors listed in DNI's Annual Information Form and
its MD&As, all of which are available from SEDAR and on its
website.
SOURCE DNI Metals Inc.