TIDMBMR
RNS Number : 6664U
BMR Group PLC
20 January 2017
BMR Group PLC ("BMR" or the "Company")
Vanadium Update
BMR is pleased to report encouraging news concerning the
potential recovery of Vanadium and production of Vanadium Pentoxide
from its tailings at Kabwe which further bolsters its asset
base.
Following the Company's announcement on 6 December 2016, the
Board is pleased to report on the progress of its metallurgical
test work currently being undertaken in collaboration with its
partners, Kupfermelt and Alfred H Knight Laboratories, Kitwe for
the recovery of Vanadium ("V") and the production of Vanadium
Pentoxide (V(2) O(5) ) from BMR's Kabwe tailings dumps.
The Board also announces the potential financial implications
for the Company in respect of the current trading price of V(2)
O(5) , and the historic V grades declared by Zambian Consolidated
Copper Mines in their Mine Closure report
a) Vanadium Recovery Factors and Upgrading to Vanadium Pentoxide
The Board is pleased to report that the metallurgical test work
to date has shown that no modifications should be required to the
acid brine leach section at the Kabwe plant to recover the V from
tailings and take it into solution as a by-product. Selective
recovery of the V in solution has been successfully achieved during
the Zinc re-leach phase, requiring only minimal changes to the
current flowsheet design.
Preliminary test work results suggest an overall V(2) O(5)
recovery factor of approximately 65% (discounted 5% from actual
test work results). Test work continues to optimise the V(2) O(5)
recovery factor, to establish final product quality and the design
of the process circuit to produce V(2) O(5.) This will enable CAPEX
and OPEX costs to be established, of which the former will be at an
additional construction cost to the Company. An announcement will
be made as soon as practicable concerning this additional cost,
although at this stage the Company does not believe that it will be
substantial. New technology will not be required for the production
of V(2) O(5) .
b) Vanadium Pentoxide, Zinc and Lead Tailings Grades
Prior to the closure of the Kabwe mine in June 1994, each of the
mine's tailings dumps were assayed by Zambian Consolidated Copper
Mines (ZCCM), the results of which were disclosed in the Kabwe Mine
Closure Report.
Although Mineral Consultancy Corporation (MCC) did not report V
grades in their March 2012 JORC report, with one exception, the Zn
and Pb grades for the WPT, LPR and ISFS tailings dumps mostly
correlate closely with those published in the Mine Closure Report,
as follows:-
Comparison of grades, MCC Report to
Closure Report
MCC (Resource)
Report Mine Closure Report % Deviation
Zn Pb Zn Pb Zn Pb
WPT (JORC) 10.66% 7.21% 10.22% 6.72% 4.13% 6.80%
LPR (JORC) 3.88% 8.71% 4.33% 7.50% 11.60% 13.89%
ISFS (Non JORC) 8.07% 1.22% 8.55% 2.03% 5.95% 66.39%
MCC's QA/QC assaying protocols have classified as acceptable, a
+/-10% grade deviation for Certified Reference Materials (CRMs).
The close correlation in the two reports of the Zn/Pb grades (JORC
only, WPT and LPR), suggests in the Board's opinion that the Mine
Closure Report's stated V grades can be considered as a fair guide
to those V grades carried in the WPT, LPR and ISFS dumps as
illustrated below:
Kabwe Mine Closure Report
Indicative V2O5 Grades
MCC V2O5 Mine Closure
Tonnage Av. Grade Samples
Leach Plant Residue
(LPR) 2,725,318 1.11% 46 samples
Wash Plant Tailings
(WPT) 585,160 1.61% 10 samples
Imperial Smelting Furnace
Slag (ISFS) 1,481,563 1.87% 8 samples
V Grades have been converted to V(2) O(5) using a stoichiometric
factor. Based on a recovery factor of 65% and this estimated
tonnage, in theory the Plant could extract approximately 45,000
tonnes of V(2) O(5.)
The V tonnages and grades presented herein are non JORC and
should not be construed as recoverable reserves or resources.
c) Upgrading Vanadium to a JORC Compliant Resource
Current metallurgical test work by the accredited laboratory,
Alfred H Knight in Kitwe, is intended to confirm the process for
the economic recovery of V based on work already carried out by the
Company for all three tailings dumps and to produce V(2) O(5) . It
is expected that this will be completed during February 2017,
whereupon the Company will commission MCC to prepare an upgrade of
V in the three tailings dumps to a JORC Compliant Resource.
d) Vanadium Price Rise and Financial Implications for the Company
Metal Bulletin's website is reporting December 2016 trades
(Rotterdam, Europe) for V(2) O(5) at circa US$23/kg (earlier
estimated at US$15/Kg) and as a consequence the Company has revised
upwards the potential long term contribution of V(2) O(5)
production to the Company's income stream.
After discounting the current V(2) O(5) price by 10%,
illustrated below by gross sales value is its potential
contribution to the Company when compared to the theoretical
production of Zinc cathodes, Lead Sponge and Zinc Sulphate
Heptahydrate over the projected mine life currently estimated at 19
years.
LIFE OF MINE INDICATIVE PRODUCTION TONNAGES AND GROSS
SALES VALUES
PRODUCT TONNES PRICE, US/t VALUE $M
Lead Sponge 276,364 $2,267 $626.5
Zinc Cathodes 144,853 $2,693 $390.1
Zinc Sulphate Heptahydrate 570,000 $750 $427.5
Vanadium pentoxide,
V2O5 45,000 $21,000 $952.2
TOTAL $2,396.3
Note. 18(th) Jan 2017 LME Zn and Pb cash sale prices.
The calculated production values of metals are indicative and
should not be construed as likely revenues to the Company.
e) ZEMA Approval
The Company has been advised by its consultant J A Consultancy
that based on ZEMA's existing approval to build the Plant, approval
to operate a V(2) O(5) processing circuit should only require an
Environmental Project Brief (EPB) which the Company intends to
lodge in February 2017 with approval generally expected within 4 to
6 months.
Note: This announcement has been reviewed by Geoff Casson, B.Sc.
(Hons), PhD, R Eng (Zambia), Member Engineering Institute of Zambia
(Metallurgy), General Manager of the Company's Zambian subsidiary,
Enviro Processing Ltd, who is a Qualified Person in accordance with
the guidance note for Mining, Oil & Gas Companies issued by the
London Stock Exchange in respect of AIM Companies.
This announcement contains inside information for the purposes
of Article 7 of Regulation 596/2014.
Alex Borrelli, Chairman, commented: "This is encouraging news
concerning the potential recovery of Vanadium and production of
Vanadium Pentoxide from our tailings at Kabwe which further
bolsters our asset base."
Ends
For further information:
BMR Group PLC 020 7734 7282
Alex Borrelli, CEO and Chairman
WH Ireland Limited 020 7220 1666
NOMAD and Joint Broker
Chris Fielding, Head of Corporate Finance
Nick Prowting, Manager
Peterhouse Corporate Finance 020 7469 0930
Joint Broker
Lucy Williams/ Duncan Vasey/ Heena Karani
This information is provided by RNS
The company news service from the London Stock Exchange
END
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