DNI Reports Additional Bioleaching Results, Including Specialty Metals and Rare Earth Elements From Its Black Shale Projects, Alberta

DNI METALS INC. (DNI : TSX-Ven)(DG7 : Frankfurt)

TORONTO, Sept. 8, 2011 /CNW/ - DNI Metals Inc. (DNI:TSX-Ven)(DG7:FSE) is pleased to announce consolidated results from a series of bioleaching R&D studies which conclude DNI's initial testwork on surface samples from its Alberta polymetallic black shale projects, Athabasca Region, Alberta.

The bioleaching studies were carried out by Alberta Innovates Technology Futures (AITF, formerly the Alberta Research Council) to specifications formulated by DNI and Dr.Corale Brierley, of C.L.Brierley Consultancy LLC, Denver, who has been assisting DNI during the past two years as its bioleaching consultant, in formulation of DNI's bioleaching testwork programs.

The studies were implemented in several iterative stages commencing in late 2009, and were completed at the end of 2010. The studies collectively confirmed that suitable bioleaching organisms are indigenous to the shale and can be readily extracted, cultivated and adapted to the shale's chemistry. The studies also confirmed that a broad suite of metals can be collectively extracted from the shale, with high recoveries for Ni/U/Zn/Co/Cd and lower recoveries for Mo/V/Cu/Li which might be enhanced through optimized leaching parameters. Results from the above studies are consistent with results from concurrent bioleaching testwork previously announced by DNI carried out by the Bureau de Recherches Géologiques et Minières (BRGM), France, (press Apr28/2010), and simple sulfuric acid leaching tests conducted under DNI's direction at Canadian analytical facilities (press Mar4/2010).

Two sets of surface samples (#BK003 and #BK456) were tested, both of which were collected by DNI during its 2009 surface trench sampling from a 9.5m thick mineralized exposure of Second White Speckled Shale at the Buckton South Zone located approximately 9km to the south of the Buckton Mineralized Zone. Sample BK003 represents material collected over 2m of true width, and sample BK456 is a composite sample collected over approximately 4m of true width beneath sample BK003. The Buckton South Zone either represents the southerly projected extension of the Buckton Mineralized Zone, or is a separate similar mineralized Zone which has not yet been drilled (cored) by DNI, although 12m-23m thicknesses of the Speckled Shale Formation are reported in downhole logs from approximately twenty historic oil/gas wells throughout a 100-150 square kilometer area.

The earliest parts of the testwork, completed in late 2009, consisted of successful harvesting of bio-organisms from the shale, their culturing and subsequent adaptation. Acid mobility tests, completed in early 2010 to collect baseline data to assess sulfur reagent consumption during leaching, reported ranges of 7.4-12.3kg and 89.7-102.9kg of acid consumption per tonne of mineral feed for sample BK003 and BK456, respectively. The acid consumption results define too wide a range to be conclusive and will be re-tested during future work.

A set of bench scale batch amenability leaching tests (BATs) were carried out in duplicate on approximately 200gm aliquots from each of the two samples to test amenability of the shale samples to leaching and to determine the amount and suite of metals which might be extracted (recovered) from the shale via bioleaching. The BAT tests entailed leaching during 38 and 27 days of incubation for samples BK456 and BK003, respectively, utilizing the indigenous bio-organisms previously harvested from the shale.

Test results for sample BK456 are tabulated below, consolidated from the iterative studies as calculated by DNI based on analyses, weights or volumes of the various solid and liquid fractions from the leaching tests as reported by AITF. Previously announced results from similar bioleaching tests completed by BRGM and the Acid Leaching tests carried out under DNI's direction at Canadian analytical facilities are also tabulated for comparison.

Calculated Metals Extractions (recoveries)
  Bioleaching - AITF (ARC) Bioleaching - BRGM Acid Leaching - DNI Best
  Sample BK456 (1) Sample 09ASH004 (2) Sample 09ASH004 (3)
  per Solutions per Solids Biotic Tests Abiotic Tests 36hr-30C 24hr-50C
Mo 34% 30% 16% 3% 28% 51% 51%
Ni 85% 89% 88% 87% 89% 70% 89%
U 100% 94% 88% 82% 84% 67% 100%
V 8% 12% 6% 8% 34% 51% 51%
Zn 100% 85% 84% 84% 88% 70% 100%
Cu 65% 66% na 49% 53% 57% 66%
Co 91% 91% 88% 83% 86% 69% 91%
Cd 100% 98% na na 93% 71% 100%
Li 25% 22% na na 45% 58% 58%

(1) Sample BK456 is a weighted composite of samples# 09ASH004, 09ASH005 and 09ASH006. Calculated metal extractions tabulated show results based on aggregate metals extracted in all solution fractions as a percentage of the head grade, compared with extractions calculated based on the difference between head grade and aggregate metals remaining in all solid (tails) fractions. Calculated extractions for U and Cd of 104% and 102%, respectively, are stated as 100%; (2) BRGM test results reiterated from DNI press Apr28/2010 and tabulated as rounded figures. Abiotic test results from leaching in acidic conditions without addition of bio-organisms shown for comparison with the biotic test results; (3) DNI Acid Leaching results reiterated from DNI press Mar4/2010, showing comparative results from tests conducted at different temperatures leach duration.

To the extent that all of the leaching testwork completed to date represent initial tests,  the recoveries tabulated above represent minimum recoveries achievable and are initial results to be optimized during future additional testwork. The best recovery achieved to date for the various metals is shown as a benchmark on which DNI is relying for planning purposes, and as a benchmark of interim recoveries which future work will endeavor to enhance.

Results for sample BK003 are not tabulated above given that they did not meet acceptable mass balance thresholds and can only be regarded in qualitative terms indicating that the suite of metals of interest can be extracted from the shale, and that recoveries for Ni/U/Zn/Co/Cd are considerably better than for Mo/V/Cu/Li.

Following bioleaching, one of the duplicate samples was further leached in HCl to monitor precipitation of a variety of compounds (eg: jarosites, sulfates, ferro-compounds) and to assess related metals re-precipitation from the leaching solution after the metals had been extracted from the shale. The test results indicate that while a small fraction (1%-8%) of all dissolved metals, once leached from the shale, are removed from the leaching solution through re-precipitation, a considerable portion of Mo-V-Cu (at least approximately 47% of Mo, 58% V and 19% Cu) once leached from the shale are lost to re-precipitation correlated with abrupt changes in pH within the leaching solution. The foregoing processes will be addressed during future testwork intended to optimize test parameters to enhance recoveries of Mo-V-Cu.

DNI's leaching testwork over the past two years has confirmed collective recoverability of traditional metals from the shale. The testwork, however, also reported successful recoveries of additional metals of value which are incidentally extracted from shale as co-products. These co-products consist of specialty metals (Li, Sc, Th) and rare earth elements including critical rare earths (Dy, Y, Tb, Eu and Nd). To the extent that the leaching tests reported good recoveries of most of the foregoing metals, they hold potential to add considerable previously unrecognized value to the mineralized zones identified by DNI at the Property.

Grades for specialty metals and rare earth elements (REE's) from DNI's 2010-2011 winter drilling program are summarized below (see also DNI press Jul15/2011 for results for other metals), together with results from historic drilling and head grades for samples BK456 and BK003 tested during bioleaching studies. Considering the excellent uniformity of grades among all drill holes across the Buckton Mineralized Zone, the tabulated results serve to characterize grades which can be reasonably expected from the Zone.

Hole or Zone Width** (m) Weighted Average Grade (ppm)***
Sample# From-To Width Ce Dy Er Gd La Nd Pr Sm Y Yb Th Sc Li
11BK01* 46.6-66.9 20.3 85 na na na 57 79 na 11 51 5 10 12 56
11BK02* 67.0-89.8 22.8 82 na na na 50 73 na 10 51 5 11 12 59
11BK03* 41.2-61.0 19.9 77 na na na 49 47 na 9 40 3 13 11 56
11BK04* 54.5-68.0 13.5 73 na na na 41 58 na 9 39 4 10 12 53
11BK05* 61.9-74.5 12.6 74 na na na 48 42 na 9 41 4 11 11 58
7BK01* 132.9-148.2 15.3 84 na na na 58 39 na 9 62 6 10 11 55
7BK03* 75.0-101.2 26.2 98 na na na 66 45 na 10 74 7 10 12 56
7BK05* 76.8-95.2 18.4 90 na na na 55 36 na 8 55 6 10 12 56
BK456* na 4 111 16 9 20 72 94 25 17 98 9 8 17 53
BK003* na 2 55 5 2 6 25 28 9 5 22 2 9 7 68

m=metres; Eu 1-4 ppm; Tb 1-3 ppm

Hole or Zone Width** (m) Weighted Average Grade (lb/st)***
Sample# From-To Width Ce Dy Er Gd La Nd Pr Sm Y Yb Th Sc Li
11BK01* 46.6-66.9 20.3 0.17 na na na 0.11 0.16 na 0.02 0.10 0.01 0.02 0.02 0.11
11BK02* 67.0-89.8 22.8 0.16 na na na 0.10 0.15 na 0.02 0.10 0.01 0.02 0.02 0.12
11BK03* 41.2-61.0 19.9 0.15 na na na 0.10 0.09 na 0.02 0.08 0.01 0.03 0.02 0.11
11BK04* 54.5-68.0 13.5 0.15 na na na 0.08 0.12 na 0.02 0.08 0.01 0.02 0.02 0.11
11BK05* 61.9-74.5 12.6 0.15 na na na 0.10 0.08 na 0.02 0.08 0.01 0.02 0.02 0.12
7BK01* 132.9-148.2 15.3 0.17 na na na 0.12 0.08 na 0.02 0.12 0.01 0.02 0.02 0.11
7BK03* 75.0-101.2 26.2 0.20 na na na 0.13 0.09 na 0.02 0.15 0.01 0.02 0.02 0.11
7BK05* 76.8-95.2 18.4 0.18 na na na 0.11 0.07 na 0.02 0.11 0.01 0.02 0.02 0.11
BK456* na 4 0.22 0.03 0.02 0.04 0.14 0.19 0.05 0.03 0.20 0.02 0.02 0.03 0.11
BK003* na 2 0.11 0.01 0.00 0.01 0.05 0.06 0.02 0.01 0.04 0.00 0.02 0.01 0.14

m=metres; lb/st=pounds per short ton; Eu 0.002-0.008 lb/st; Tb 0.002-0.006 lb/st

*Drill holes 11BK01-11BK05 drilled by DNI. Drill holes 7BK01, 7BK03 and 7BK05 are historic hole. Drill holes tabulated are from drilling over the Buckton Mineralized Zone. Samples BK456 and BK003 are surface trenching samples tested during bioleaching tests.  **All holes are vertical and widths reported are true widths; Drill core sampled at a standard 0.5m interval; Data for historic holes based on DNI's verification analytical program which re-sampled historic drill core at lengths averaging 3.8m; Zone width represents true thickness of the flat-lying Second White Speckled Shale Formation which hosts the polymetallic mineralization within its contacts.  ***Analyses are weighted averages over the entire intercept of the Speckled Shale Formation based on lithogeochemical characterization; Data for historic drill holes from DNI's verification analytical program; lb/st=pounds per short ton; na=not available; Analyses by Activation Labs, Ancaster, ON; REE analyses by ICP or MS after total sample digestion; In addition to analytical blanks and standards utilized by Actlabs as part of its analytical quality assurance and quality control ("QA/QC") protocols, DNI's QA/QC parameters consist of duplicate analyses as follows: one matrix-matched analytical blank per 10 samples, one duplicate analysis of pulverized pulp per 10 samples, and one duplicate subsample from coarse fraction per 10 samples.

Considering the uniformity of grades among all drill holes across the Buckton Mineralized Zone, the tabulated results above serve to characterize grades which can be reasonably expected from this Zone which holds potential for hosting 1.4-1.5 billion short tons of polymetallic mineralization extending over 26 square kilometers and is open in three directions. If amortized over the Buckton Mineralized Zone, the apparently modest grades tabulated are significant and represent an immense in-situ metallic budget of recoverable specialty metals and REE's ranging in the millions of pounds for any given metal. Sufficient drilling has been completed over a portion of the Buckton Mineralized Zone to classify a portion of it to an inferred resource relating to base metals and Uranium. A similar study relating to specialty metals and REE's will follow later in the year.

Calculated recoveries of specialty metals and REE's based on results from the AITF bioleaching testwork studies are summarized below for sample BK456.

Calculated Bioleaching Recoveries for Specialty Metals* - Sample BK456
  Ce Dy Er Eu Gd La Nd Pr Sm Tb Y Yb Th** Sc Li
per Solutions 77% 92% 88% 83% 88% 66% 66% 58% 91% 97% 90% 90% 100% 51% 25%
per Solids 68% 92% 92% 86% 90% 70% 78% 76% 83% 92% 92% 64% 74% 57% 22%
*calculated by DNI based on analyses, weights or volumes as reported by AITF
** Calculated extraction of 111% (per solution) for Th stated as 100%

Despite the general availability of commodity price quotes for specialty metals and REE's, given lack of transparency in their respective commodity markets, assessment of the economic impacts that these metals might have as co-products on future development DNI's polymetallic shales cannot be determined at this time. The grades and incidental recoverability of these metals are, however, material to any potential production scenario envisaged by DNI for continuing exploration and development of the six mineral systems identified at the Property as a long term source of a variety of metals. The foregoing results compel DNI to broaden scope of its future testwork to actively focus on specialty metals and REE's recoveries alongside the base metals of interest which have so far been DNI's primary focus.

General Update of Work In Progress:
A resource study over a portion of the Buckton Mineralized Zone is nearly completed and will be announced shortly. Plans are to augment and amend the study with a stand-alone resources study to estimate specialty metals and REE's resources, and related metallic budget hosted within the resources being delineated over a portion of the Zone.

Bioleaching testwork is in progress on composite samples from the past winter's drilling. This work will substantially repeat work completed to date on surface trenching samples, and is slated for completion at the end of the year. Other work is in its planning stages to expand and optimize leaching parameters.

Permitting applications have been submitted in advance of a planned winter drilling to probe projected extensions of the Buckton Mineralized Zone and to commence initial drilling over the Buckton South Zone which may represent its southerly extension or an entirely separate similar Zone.

DNI continues to focus its efforts on its polymetallic black shale Properties in Alberta, and on its carried interest in the diamond discovery on its Attawapiskat Property, Ontario.

The Qualified Person in connection with this press release is S.F.Sabag P.Geo, DNI's president and CEO, who has reviewed analytical results and is responsible for preparation of this press release. All detailed data underlying test results reported herein are included in Alberta Mineral Assessment Report#MIN20100017.

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: 60,100,284

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 MDS&A's, all of which are available from SEDAR and on its website. 


SOURCE DNI Metals Inc.

For further information:

DNI Metals Inc. - Shahe Sabag, President & CEO or Denis Clement, Chairman - 416-595-1195
email ir@dnimetals.com. Also visit www.dnimetals.com

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