Omahola Project - June 2010
The Omahola Project comprises the INCA uranium and iron and Tubas Red Sand (TRS) uranium deposits.
At the INCA deposit the Indicated and Inferred Mineral Resource totals 16,000,000 tonnes at 400 ppm eU3O8 for 6,366 tonnes (14 Mlbs) eU3O8, and the TRS deposit contains Measured, Indicated and Inferred Resources totalling 13,846,700 tonnes at 160 ppm eU3O8 for 2,217 tonnes (4.9 Mlbs) eU3O8.
- The Mineral Resource estimate for the Omahola Project is 29.8 M tonnes at 287 ppm eU3O8 for 8,583 tonnes (18.9 Mlbs) eU3O8.
The initial Mineral Resource estimate is in line with RUN’s expectations and underpins its objective of conducting a Pre-Feasibility Study (PFS) on the Omahola Project. In February 2010, SNC Lavalin was awarded a contract to conduct the PFS, which is currently scheduled to be completed in October Quarter 2010.
INCA
The mineralisation at INCA is best described as metasomatic introduction of uranium and iron into a northeast plunging syncline. Although the footwall to the syncline is competent crystalline marble, skarn formation is limited and mostly occurs within other calc-silicate strata within the syncline.
As can be seen in Figure 2 an area of roughly 500 by 500 metre was subjected to detailed drilling and is the area represented by the initial Mineral Resource estimate for INCA.
Ongoing drilling at INCA, following on from that used in the initial INCA resource estimate, includes reverse circulation (RC) holes and diamond core tails on select holes. The core samples will be used for additional metallurgical testwork.
Drilling has progressed within and around the initial resource area. Results from new drilling within the resource grid area will serve to improve the confidence and potentially expand the initial JORC Code resource estimate, while results from drilling outside and around the initial resource area are expected to increase the overall resource.
Figure 1: Tenement and Project Area Location Map
Figure 2: INCA drill hole map showing JORC Resource grid area relative to larger footprint of mineralisation
As previously announced, the INCA deposit contains substantial quantities of magnetite which can potentially be separated from the material during processing for possible sale as a by-product. In addition, drilling at INCA has identified areas of magnetite without uranium mineralisation that could be suitable for a saleable magnetite product. Additional testing and evaluation will be conducted as part of the PFS.
Drill Rigs at INCA - April 2010
TUBAS RED SAND (TRS)
TRS consists of secondary uranium mineralisation (carnotite) in well-sorted aeolian (windblown) sand which occurs immediately south of the Tubas palaeochannel. A relatively small area was intensely grid drilled around a trial mining trench to acquire bulk samples for physical beneficiation testwork and it is that data that constitutes this resource estimation.
The mineral resource estimate for the TRS deposit is considered initial as this style of mineralisation has been encountered in numerous boreholes outside the current TRS Mineral Resource area. These results suggest that mineralised red sands occur adjacent to and may potentially flank the mineralised Tubas-Oryx palaeochannel system which stretches some 30 kilometres across RUN’s EPL 3496. The true extent can only be determined with future drilling.
The justification for the lower cut-off grade of the TRS deposit is based on unique aspects of the deposit. Firstly, the deposit is very near surface, with only minimal cover of wind-blown materials and gravel-gypcrete-calcrete of 1-2 metres. Secondly, TRS is predominately free-flowing to loosely consolidated sandy material. The combination makes the deposit amenable to simple and low cost mining techniques. Thirdly, TRS material tests positively to relatively simple beneficiation; that being attrition scrubbing with balls followed by screening.
As a consequence of the very positive beneficiation results and free-digging nature of the red sands from surface, it is highly likely much lower grades of uranium can be economically mined. For example – 150 ppm U3O8 run-of-mine material can be potentially upgraded to +500 ppm U3O8 for processing with INCA material.
PRE-FEASIBILITY ENGINEERS APPOINTED
After a lengthy evaluation process it was decided to appoint SNC-Lavalin SA (Pty) Ltd (SNC) as Reptile Uranium Namibia’s (RUN) consultants to complete the PFS. This decision was based upon their world wide experience in uranium processing plants and mines. Their team will augment the in-house expertise of RUN’s Project Manager, General Manager and Managing Director, all who have extensive uranium processing experience.
Metallurgical Testwork
Mintek of South Africa was selected to conduct the metallurgical testwork on both the INCA and TRS material.
The metasomatic origin of the INCA mineralisation which consists of both primary and secondary uranium associated with variable alteration (including carbonate) and magnetite within granite, granitic gneiss and metasedimentary rocks has led to a decision to initially separate the three main ore types at INCA for extraction trials prior to blending them proportional to their volumetric contribution within the deposit for the final testwork.
Basically a mild sulphuric acid leach will most likely be the chosen processing route with refinements for carbonate neutralisation and/or removal and iron (magnetite) recovery.
Pyrite (and lesser pyrrhotite) is almost ubiquitously present from shallow depths within the INCA deposit and recovery through flotation will be tested later for use in an autoclave to produce sulphuric acid. This is commonly used ‘off-the-shelf’ technology and should present no problems.
Mintek has completed attritioning and uranium concentration and size distribution tests on the TRS material and a brief summary of their report follows below. Testwork is now being conducted on how best to separate the fine fraction containing most of the uranium and then to physically separate the gangue material from the carnotite within it.
Summarised Results of Mintek Test Work on TRS Samples
The geological model of the TRS deposit is still being developed at this stage, but the mineralised aeolian sand has been located in drill holes south of the Tubas Palaeochannel over a distance of at least 20 kilometre. Continuity and distribution needs to be defined in future with detail grid drilling. It is presumed given its unconsolidated free-digging nature that a lower grade than required in cemented calcrete hosted mineralisation will suffice and its low carbonate content makes it amenable to treat in either an acid or alkali processing plant.
Test work to determine the characteristics of the TRS carnotite mineralisation and possible beneficiation methods was carried out by Mintek (South Africa) on composite mineralised samples collected from the trial mining trench (previously reported) within the deposit that was subjected to resource drilling. Size-by-size and uranium analyses were done on the samples as received. Laboratory scrubbing and attritioning test work were also performed.
The uranium is concentrated in the finer fraction for both the raw as well as the processed samples. The highest concentration was obtained when scrubbing when a ball charge of 10% was used as the test method.
- For the raw sample 87.5% of the U3O8 concentrated in 24% to 27% of the material in the minus 150 micron fraction while in the minus 38 micron fraction 77% of the U3O8 concentrated in 17 to 20% of the feed.
- Scrubbing with balls efficiently broke the top size of the material and ensured that the majority of the U3O8 was liberated into the finer size fractions. The minus 75 micron material contained 90% of the U3O8 in 22% of the feed.
It is envisaged that a dry air classification process would be used at the TRS site to concentrate the uranium minerals. The concentrated ore would then be transported to the INCA processing plant about 10 km to the north of the trial trench site. This upgrading process would decrease the transport cost and the processing costs at INCA. The TRS will be added to the INCA ore at amounts to be determined by the INCA process characteristics.
Environmental Studies and Mining Licence Applications for Iron Production
RUN decided after a detailed evaluation and selection process to appoint Softchem from South Africa to complete its EIA and EMP studies for the Omahola Project. Softchem completed the original Langer Heinrich Mine’s environmental studies and reports and are well regarded in the industry and in Namibia in particular.
The study into supplying ferric (iron) to the Rossing Uranium mine is ongoing and once complete a decision will be made whether to proceed with this project as a precursor to the fully fledged uranium and iron producing facility. At present the environmental base line studies for early stage Mining Licence (ML) applications to produce iron alone exclude tailing disposal and any chemical extraction activities. Once Mintek’s metallurgical testwork indicates the processing route and hence chemicals and tailings characteristics the environmental studies will be expanded accordingly.
Pre-Feasibility Timing
Mintek estimate three (3) months from receipt of the 2.5 tonne INCA sample to complete their testwork. At this stage therefore the estimated completion date is September 2010.
Softchem’s studies and reports should be complete within the same timeframe, but if RUN proceeds with early stage Mining Licence applications to produce ferric (iron) the initial EIA/EMP procedures will be completed sooner and then expanded to encompass the tailings and chemical processing plant.
Electricity
Presently there is excess power available in Namibia with further generating capacity being planned. This is not seen to be a problem.
Water
Areva who have constructed a desalination plant north of Swakopmund have publically announced they will have excess water available which will probably be distributed by NAMWATER. RUN is however undertaking pilot-scale studies to produce potable water from the saline water contained within the INCA proposed pit area. Large quantities of similar water is known to be present in the Tubas palaeochannel a few kilometre south and east of INCA and at present RUN plans to evaluate the commercial aspects of producing its own water on site through desalination and injecting the brine back into the saline aquifer.
Mining Licence Applications
In Namibia permission to mine and mining activities is controlled by the Ministry of Mines and Energy (MME) and Act No. 33 of 1992: Minerals (Prospecting and Mining) Act, 1992. It is necessary for the holder of a valid Exclusive Prospecting Licence (EPL) to apply for a Mining Licence (ML) and that application includes a range of other conditions to be met – the most onerous for RUN in the case of EPL 3496 will be the environmental aspects as the deposits occur in the Namib-Naukluft National Park.
It is normal practice to lodge the application for a ML once a Definitive or Bankable Feasibility study has been completed. RUN has however presented a case for exemption to the MME for an early ML application based upon a two stage environmental clearance procedure where no chemical processing (and resultant tailings facilities) would initially occur on site. High grade uranium bearing mineralised sand from TRS could be trucked to either of the existing nearby uranium producers for treatment as it contains low concentrations of carbonate and is amenable to either alkali or acid processing. The uranium mineralisation at INCA is primary and in part associated with sulphides (pyrite) and would need to be processed through an acid based plant such as at Rossing Uranium.
Off-take Agreement
RUN has been in technical discussions with Rossing Uranium (the majority owned Rio Tinto uranium mine in Namibia) and during these discussions it became clear that RUN could potentially produce ferric iron from INCA, which Rossing requires in their processing plant and presently imports. Portions of the INCA deposit contain massive iron oxide that is either uranium-poor or totally unmineralised and could be supplied to Rossing prior to completion of a fully fledged uranium processing plant at INCA which would ultimately produce such iron as a by-product.
Rossing has agreed in writing for RUN to proceed with this investigation and enter into a commercial off-take agreement should the iron produced from INCA be suitable for use in their plant. RUN has undertaken to complete a detailed investigation into the close-to-surface distribution of uranium-poor iron (magnetite) within the detail grid area being drilled out at INCA and apply for a ML.
If the iron product is suitable, early indications are that it is, then exploiting it will serve a number of purposes while detailed investigations into a uranium processing plant at INCA continue in conjunction with the required Stage Two environmental and other studies. Included in these is the advantage of being able to bulk sample the INCA deposit so getting a better understanding of the complex mineralisation and also to determine the most efficient mining method whilst pre-stripping the open-pit area.
Operating Plan
Environmental Impact Assessments (EIA) and Environmental Management Programmes (EMP) for ‘Stage One’ will be restricted to basic extraction and physical processing of material at both TRS and INCA (including both mineralised and unmineralised iron).
At TRS, it is doubtful that anything other than such basic activities will ever occur with suitably mineralised sand being transported elsewhere for treatment, i.e. all that will be required is the Stage One environmental studies. At INCA however, a fully fledged metallurgical and chemical processing plant is envisaged over time which entails the full environmental ambit given the presence of chemicals and tailings that potentially could have more deleterious affects on the environment and ground water.
At INCA under Stage One iron oxide bearing rock will be extracted - possibly by drill and blast methods - put over a ‘grizzly’ with openings of say 300 mm. Any oversize will be broken down by hydraulic breaker with all material collected in a hopper bin and all product will then be transported on a conveyor with a radiometric sensor over it to allow for removal of radioactive material for later processing. An overhead belt magnet will then remove all the iron bearing material onto another belt and stockpile. That product will then be transported off-site for crushing, screening and magnetic sorting prior to delivery to Rossing. Waste will be returned to the INCA site. Power will be diesel generated and only daylight hours will be worked.