PERTH, Australia, April 30, 2013 /CNW/ - Elemental Minerals Ltd. (ASX,TSX: ELM) ("Elemental" or "the Company") is pleased to provide the following quarterly update for activities at its Sintoukola Potash Project located in the Republic of Congo ("ROC").
- Completion of Phase 3A drilling programme to extend sylvinite in northwest part of Kola
- Acquisition of a very large dataset for historic exploration and potash mining within the ROC
- Regulator review of the Congolese Compliant Social and Environmental Impact Study (SEIA) submitted in the last quarter
- Land rezoning and compensation process underway
- Continued modularisation studies with AMEC in preparation of the start of the Feasibility studies
- Continued land acquisition process
- Engagement with regulators in support of the Congolese Environmental and Social Impact Study (ESIA)
- Preparation of submission of the International (ESIA)
Post quarter end, on 11 April 2013 Elemental announced that it has received an indicative, non-binding, incomplete and conditional proposal which, if it were to proceed to a formal offer, could result in an offer being made to acquire all of the outstanding shares in Elemental for a cash price of A$0.66 per share (the "Proposal").
The Proposal has been made by Dingyi Group Investment Limited ("Dingyi"), a company incorporated in Bermuda and listed on the Hong Kong Stock Exchange. Dingyi is an investment company with interests based primarily in Hong Kong and Mainland China. Receipt of the Proposal is a result of the process initiated by the Board of Elemental in June 2012 to explore strategic alternatives for the Company.
The Board intends to continue to progress negotiations with Dingyi during the exclusivity period to a point where it is able to assess whether a suitable binding agreement can be considered and if thought appropriate put to shareholders. If such an outcome can be achieved, the Board will provide a formal recommendation to shareholders as to the merits of the Proposal at that time.
Geology and Mineral Resources
The Phase 3A drilling was completed during the quarter, comprising two boreholes totalling 551.48 metres, to extend sylvinite mineralisation in the northwestern part of Kola (see Figures 1 and 2). Significant intersections are shown below.
Results of Phase 3A drilling:
|Hole||Zone||From (m)||To (m)||True Width (m)||% K2O||% KCl|
The position of Phase 3A boreholes (using hand-held GPS):
The Phase 3A intersections will likely contribute to an increase and upgrade of the Mineral Resource estimates; an update of the resource model is planned as part of the Bankable Feasibility Study later in the year. The results also further demonstrate the extent of high grade sylvinite mineralisation, which remains open in almost all directions as is shown in Figure 1.
Through a data swap agreement with a prominent oil and gas exploration group active in the area, Elemental has taken delivery of an additional 2D seismic data covering 40 square kilometres of the western portion of the Kola deposit and possible extension (Figure 1). The additional seismic data will complement existing datasets and assist with resource modelling and classification.
A large database including data from the 1960's to the late 1980's has been acquired, including detailed operational reports for the historic Holle potash mine, exploration data and reports for the Congo Basin, 2D seismic data and drilling reports for boreholes across the basin. This database will greatly assist in Elemental's Bankable Feasibility Study and exploration.
Bankable Feasibility Study (BFS)
A 12-month metocean survey is currently underway to define meteorological and oceanographic conditions to be used in the brine discharge modeling, the design of the marine facilities and included in the ESIA submission.
A phase of bridging studies was launched at the end of the PFS to address remaining open scope items and investigate optimization opportunities before the start of the BFS. These studies being conducted by AMEC, Egis, SRK and ELM, have been concluded and delivered the following positive outcomes:
- The method of material transport has been changed from road haulage to overland conveyor. This will produce significant social and environmental benefits as well as reduce the operating cost.
- Filtration of the insoluble process residue has been included into the design of the process flow. This will improve brine recovery and significantly reduce the residue storage facility footprint.
- The results of the latest geotechnical field investigation have been incorporated into an evaluation of foundation design options for the process plant buildings. These recommendations will be implemented during the BFS.
- A simulation study to determine the optimum stockpile sizes from mine to plant have been completed and recommendations will be implemented during the BFS.
- A detailed review of the high angle conveyor concept to be used in the shaft was completed and confirmed the feasibility of this application
- Investigations are ongoing to optimize the gas off-take location to reduce initial capital requirements associated with the gas pipeline
- An internal assessment was completed to evaluate various alternatives with regards to a phased implementation approach in order to reduce initial capital requirements. The investigation identified potential benefits of starting a 1Mtpa production and then ramping up to 2Mtpa within 5 years. This concept will be further investigated during the BFS.
A land commission was established in cooperation with the Ministry of Land Affaires. This commission facilitated the successful survey of the land corridor required by the project by the cadastral office of the Republic of Congo. A DUP (Dècret d'Utilité Publique) was gazette on 21st February 2013 for phase 1 (process plant, employee facilities, residue storage facility, mine site, and transport corridor) The plot enquiry process is currently underway to determine compensation values.
About Elemental Minerals
Elemental Minerals Limited (ASX/TSX:ELM) is an advanced mineral exploration and development company that aims to grow shareholder value through its 93%-owned Sintoukola Potash Project. The Sintoukola project has the potential to be among the world's lowest-cost potash producers and its strategic location near the coast of Central Africa offers a transport cost advantage to key Brazilian and Asian fertilizer markets. For more information, visit www.elementalminerals.com
Mineral Resource Summary - Kola Deposit of Sintoukola Project1
- The Sintoukola Project's Kola deposit contains 1.32 billion tonnes Measured and Indicated mineral resources with an average grade of 15.65% K2O (24.78% KCl), and Inferred Mineral Resources of 948 Mt grading 16.20% K2O (25.64% KCl), at a 10.0% K2O cut-off grade.
- Within the Mineral Resources, the sylvinite portion contains 573Mt with an average grade of 20.92% K2O (33.13% KCl) within the Measured and Indicated category and 475Mt of Inferred Mineral Resources grading 20.39% K2O (32.27% KCl).
- Four main potash mineralised seams are present within the Kola deposit and are identified in stratigraphic and chronological order as: Hangingwall Seam (HWS), Upper Seam (US), Lower Seam (LS), and the Footwall Seam (FWS). The depth to the top of the Upper Seam is within 250 to 320 metres from surface.
- Exploration at Kola has focused on the Upper Seam and Lower Seams which contain the bulk of the Mineral Resources defined to date. The Hangingwall Seam was discovered in September 2012 and contributes 47Mt at an average grade of 34.75% K2O (55.01% KCl) to the Inferred Mineral Resources, and the Footwall Seam 225Mt grading 17.63% K2O (27.92% KCl) also in the Inferred category.
- The Mineral Resources are reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves 2004 Edition (The JORC Code), which is consistent with Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards 2005 and hence complies with NI 43-101.
Competent Person / Qualified Person Statement:
Information in this report that relates to Exploration Results or Mineral Resources is based on information compiled by Dr. Simon Dorling, Mr. Jeff Elliott and Dr. Andrew Scogings of CSA Global Pty Ltd, the Company's geological consultants. Dr. Dorling, Mr. Elliott and Dr. Scogings are members of the Australian Institute of Geoscientists (MAIG) and have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity they are undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (the JORC Code). Dr. Dorling, Mr. Elliott and Dr. Scogings are also Qualified Persons for the purposes of Canadian National Instrument 43-101 and they consent to the inclusion in this report of the information, in the form and context in which it appears. Mr. Elliott and Dr. Dorling have verified the exploration data disclosed in this news release.
Further information with respect to Elemental's Sintoukola Project is contained in a technical report entitled ''NI 43-101 Technical Report, Sintoukola Potash Project, Republic of Congo'' prepared for the Company by SRK Consulting (U.S.), Inc., CSA Global Pty Ltd., EGIS International and AMEC Americas, dated September 17, 2012 with an effective date of September 17, 2012 (the "Technical Report"). The Technical Report can be accessed on the Company's profile on SEDAR.
This report contains statements that are "forward-looking". Generally, the words "expect," "potential", "intend," "estimate," "will" and similar expressions identify forward-looking statements. By their very nature, forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, to differ materially from those expressed or implied in any of our forward-looking statements, which are not guarantees of future performance. Statements in this news release regarding the Company's business or proposed business, which are not historical facts, are "forward looking" statements that involve risks and uncertainties, such as resource estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.
Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made.
1 For a full description of the resource refer to the NI 43-101 Technical Report, 17 September 2012 available on SEDAR, www.sedar.com
Image with caption: "Figure 1. Map showing EK_46 and EK_47 and distribution of sylvinite mineralisation at Kola. Includes the Upper Seam, Lower Seam and Hangingwall Seam, where over 1 metre in thickness and in Measured, Indicated or Inferred Mineral Resource categories (Hangingwall seam all Inferred). Arrows indicate portions of the deposit where the sylvinite is 'open' (potential to expand). The red lines show the recently acquired 2D seismic data. Line of cross section (Figure 2) is shown. (CNW Group/Elemental Minerals Limited)". Image available at: http://photos.newswire.ca/images/download/20130430_C9955_PHOTO_EN_26159.jpg
Image with caption: "Figure 2. West to East cross section (looking northwest) through the northwest portion of Kola showing the potash seams. Line of section is shown on Figure 1. Abbreviations: USS=Upper Seam Sylvinite, LSS=Lower Seam Sylvinite, HWSS=Hangingwall Seam Sylvinite, FWSS=Footwall Seam Sylvinite, USC= Upper Seam Carnallitite, LSC=Lower Seam Carnallitite, TSS=Top Seam Sylvinite. (CNW Group/Elemental Minerals Limited)". Image available at: http://photos.newswire.ca/images/download/20130430_C9955_PHOTO_EN_26160.jpg
SOURCE: Elemental Minerals Limited
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