8 May 2012 14:29
Minco reports additional information on manganese property in New Brunswick, Canada
Dublin, 8 May 2012 - Minco plc (AIM-"MIO"), the Irish exploration and development company, today released further information on the Woodstock Manganese Project in New Brunswick, Canada, on which Minco has secured a six month evaluation option from Buchans Minerals Corporation (BMC-TSX-V)("Buchans").
Based on historical exploration work, the Woodstock deposits are potentially one of the largest undeveloped manganese carbonate resources in North America. Woodstock, although still at an early stage, is believed to have the potential to be developed into a significant producer of Electrolytic Manganese Metal (EMM), which is used primarily in the production of stainless steel.
Worldwide demand for EMM has expanded significantly since 2000, particularly in China, and is expected to continue to grow (1) (2). Over 95% of world supply of EMM currently comes from China.
John Kearney, Chairman of Minco, stated: "We are very intrigued by the possibilities for the Woodstock manganese project in New Brunswick which has the potential to be developed into a major world class asset".
Woodstock Manganese Option:
Under a multi-part agreement with Buchans, announced April 30, 2012, Minco has been granted the exclusive right, for a period of six months, to conduct a full evaluation and due diligence on the Woodstock manganese property with a view to potentially entering into a joint-venture agreement with Buchans to develop the Woodstock manganese project. Minco has agreed to pay Buchans $1 million for the exclusive six month option, which funds will be used during the option period primarily for the advancement of the Woodstock property.
If during the exclusive Woodstock option period Minco elects to develop the Woodstock project, the form and terms of a joint-venture agreement will be negotiated between Minco and Buchans prior to the expiry of the Woodstock Option.
Location, Background and Historical Resources:
Buchans Minerals Corporation holds a 100% interest in the mineral rights for the 5,800 hectare Woodstock Manganese property in New Brunswick, Canada.
The project has excellent infrastructure, including railway lines (16 km west) as well as the TransCanada Highway and major electrical transmission lines located less that 5 kilometres to the east. The Plymouth deposit is located less than 10 kilometres east of the US border and Highway Route 95 (an extension of US Interstate 95) passes less than a kilometre south of the deposit.
Historical literature indicates that the Woodstock property hosts three deposits of sediment-hosted-manganese-iron mineralization, first discovered in 1957 by Strategic Manganese Corporation. These historic deposits include the Plymouth and two Hartford deposits (North & South), located 5 kilometres west of the town of Woodstock.
In 1957, Strategic Manganese Corporation reported that the Plymouth deposit extends from surface to a minimum depth of 500 feet (152 metres) and hosts a historic, uncategorized resource estimate of (3)51.2 million short tons (46.5 million tonnes) averaging 10.9% Mn (manganese) and 13.3% Fe (iron).
The Hartford North and South deposits are located less than 2 kilometres on strike to the north of the Plymouth deposit. Historic uncategorized resource estimates for the Hartford deposits by Strategic Manganese Corporation in 1957, were reported to include 50 million short tons (45 million tonnes) grading 8% Mn and 12% Fe at the (3)North Hartford deposit and an additional resource of 50 million short tons grading 8% Mn and 12% Fe at the (3)South Hartford deposit.
The historical reports indicate that the Plymouth resource estimate was compiled from data acquired from a total of 17,388 feet (5,300 metres) of drilling; the North Hartford resource estimate was compiled from data acquired from a total of 13 drill holes totaling 5,381 feet (1,640 metres) of drilling as well as gravimetric geophysical data, and the South Hartford resource estimate was compiled from data acquired from a total of 9 drill holes (footage undisclosed) as well as gravimetric geophysical data.
Quoted historical resource estimates are based on data obtained and prepared by previous operators. Buchans Minerals has not located the original assay sheets or details of the estimation methodology completed, nor has Buchans Minerals undertaken the work necessary to verify or classify the mineral resource estimate. Minco is not treating the historical mineral resource estimates as current resources verified by a qualified or competent person and the estimates should not be relied upon. Verification and classification of the Woodstock resources will require considerable further evaluation, the scope of which will be assessed during the Minco's Option Period.
Electrolytic Manganese Metal: (1) (2)
Electrolytic Manganese Metal (EMM) is used primarily in the production of stainless steel. The EMM market has significantly expanded since 2000 when stainless steel production began to make use of EMM as a replacement for nickel, particularly in China. Since 2002 development of chrome-manganese stainless steel production has been swift, dramatically increasing demand for manganese and accelerating development of the EMM industry, particularly in China.
Worldwide demand for EMM rose from 250,000 tonnes in 2002 to over 1,532,000 tonnes in 2011, a 513% increase in nine years, with China supplying 97% of demand, primarily from manganese carbonate ores.(2) EMM world demand is forecast to rise from over 1,532,000 tonnes in 2011 to almost 2,839,000 tonnes in 2021(an average increase of nearly 131,000 tpa) with the price predicted to increase from $1.53/lb to $2.30/lb over the same period(1).
It is believed that over 90% of Chinese EMM is produced from manganese carbonate ores(1). Processing of carbonate manganese ores has the advantage of eliminating the requirement for addition of a reducing agent to solubilise manganese in the leach, as is the case with manganese oxide ores. Mineralogical examination of 2011 drill core from the Woodstock deposit has shown that the manganese contained in Woodstock is primarily present as manganese carbonate.
The manganese content of manganese carbonate reserves in China is estimated at roughly 30 million tonnes Mn(1). The historic resource estimates for Woodstock(3) are equivalent to a total manganese metal content of 12.3 million tonnes Mn andare potentially one of the largest undeveloped manganese carbonate resources in North America. Woodstock is believed to have the potential to be developed into a significant producer of Electrolytic Manganese Metal (EMM).
Hydrometallurgical Testing:
In 2011 Buchans retained Thibault & Associates Inc., Chemical Engineering Consultants, of Fredericton, N.B. to complete a bench scale test program for development of a hydrometallurgical flow sheet for recovery of manganese on a representative composite sample of the Plymouth deposit. The recently completed test program was aimed at continuing to identify and optimize a leach process to extract the manganese from the deposit, as well as new tests designed to purify the resulting leach solution to produce an electrolyte suitable for the production of EMM.
The composite sample, taken from Buchans' 2011 drill program, had an average weighted grade of 11.07% manganese and 15.25% iron. The bench scale test program successfully demonstrated that, at optimum leach conditions, leach recoveries averaging 96.6% (range of 94% to 98%) could be achieved using a single stage sulphuric acid leach. In addition, the leach solution purification portion of the test program resulted in the production of a high purity manganese sulphate electrolyte, which is expected to produce high grade electrolytic manganese metal (EMM).
The leach process developed by Thibault & Associates for Woodstock is similar to that used on Chinese manganese carbonate ores(1), but with higher anticipated manganese recoveries.
An additional solution purification circuit employing solvent extraction to further purify the leach solution, with a view to producing EMM of exceptional purity, has also been successfully tested. Further bench scale testing of this process is required to optimize operating parameters and establish operating costs before this process can be considered for incorporation in the main hydrometallurgical process.
Thibault & Associates recommended that the sulphuric acid leach, solution purification unit operations and electrolytic process be pilot tested to confirm these findings.
Manganese Project Evaluation:
Buchans Minerals Corporation believes, and Minco agrees, that the opportunity exists to develop manganese carbonate deposits to produce EMM outside of China to meet the future demand from China and the rest of the world and that the Woodstock deposits have the scale and process characteristics to play a major role in this opportunity. Buchans wishes to advance the Woodstock project as rapidly as possible and, given the potential scale of the project, is seeking a partner to advance the project.
Minco has been granted the exclusive right, for a period of six months, to conduct a full evaluation and due diligence on the Woodstock property with a view to potentially entering into a joint-venture agreement with Buchans to develop the Woodstock manganese project. Minco has agreed to pay Buchans CDN$1 million for the exclusive six month option, and these funds will be used during the option period primarily for the advancement of the Woodstock project.
Based on the bench scale test program results a dynamic economic model which simulates the process flow sheet and quantifies conceptual operating and capital costs has been developed and will be evaluated by Minco during the Option Period. A treatment rate of 3,000 tonnes per day producing about 100,000 tonnes per year EMM over thirty years will be evaluated. A treatment rate of 6,000 tpd producing about 200,000 tpa EMM over 20 years may also be considered.
References:
(1) Manganese Market Outlook, February 2012, CPM Group, New York, USA).
(2) China Manganese Industry Chain Analysis for 2010 and for 2011-2012, Shanghai Metals Market.
(3) Historic resource estimates from an article written by K.O.J. Sidwell, 1957: The Woodstock, N.B., Iron-Manganese Deposits. Transactions of the Canadian Institute of Mining and Metallurgy, volume LX, 1957, pages 231-236.
About Minco plc
Minco plc, registered in the Republic of Ireland and listed on the AIM Market of the London Stock Exchange ("MIO"), is a exploration and development company, currently engaged in zinc-lead exploration in Ireland and with investments in zinc‐silver projects in Mexico through holding 30 million shares (~29%) in Xtierra Inc. listed on the TSX Venture Exchange (TSXV-"XAG"). Minco also holds a 2% NSR royalty on the Curraghinalt gold property in Northern Ireland which is being explored by Dalradian Resources Inc. (TSX-"DNA").
On April 30, 2012 Minco announced an agreement with Buchans Minerals Corporation (TSXV-"BMC") whereby Minco was granted an exclusive six month option to evaluate Buchans' Woodstock manganese property in New Brunswick, Canada, with a view to potentially entering into a joint-venture agreement to develop the property and whereby Minco can earn a 51% joint venture interest in Buchans' base metal properties in Newfoundland, Canada by investing CDN$8 million over four years to advance the Lundberg deposit to final feasibility and to further explore Buchans' extensive mineral properties in the historic Buchans mining camp. Minco also agreed to acquire approximately 10% of the shares of Buchans Minerals Corporation in a private placement of CDN$1 million.
Prior to 2011 Minco's principal project was the discovery, exploration and development of the Pallas Green zinc lead project in Ireland, held in joint venture with Xstrata Zinc. In October 2011 Minco sold its joint venture interest in Pallas Green to Xstrata for US$19.4 million.
Since the sale of its Pallas Green lead-zinc property in Ireland to Xstrata in October 2011 Minco has been continuously evaluating numerous projects and properties in various parts of the world. The objective has been to identify a quality opportunity for Minco, which has the possibility to create significant value for Minco shareholders without assuming unacceptable levels of risk.
Minco continues to explore two other base metal prospecting licenses in Ireland, one located adjacent to the currently operating Lisheen zinc/lead mine (Vedanta) and the recently producing Galmoy mine (Lundin), and the second held in joint venture with Boliden, adjacent to Boliden's currently producing Tara zinc/lead mine.
Minco currently holds approximately US$20 million in cash and is evaluating a number of investment opportunities in the minerals industry in North America and Europe.
For further information on Minco, refer to Minco's website at www.mincoplc.com
About Buchans Minerals Corporation:
Buchans Minerals Corp (BMC-TSXV) is a Canadian resource company that is focused on exploring and developing base metal properties in the historic and famous Buchans mining camp in central Newfoundland, Canada and a manganese project in New Brunswick, Canada.
Buchans Minerals holds three main properties in and around the Buchans area that contain numerous exploration prospects that are being evaluated for their viability to become operating mines. These properties are the 100% owned Buchans property (which contains the Lundberg deposit), the 100% owned Tulks North property (which contains the Daniels Pond deposit) and the 50% joint ventured Long Range property. Buchans Minerals holds a 100% interest in the mineral rights for the 5,800 hectare Woodstock Manganese property in New Brunswick.
For further information on Buchans Minerals Corporation refer to Buchans' website at www.buchansminerals.com
For further information, www.minco.ie or contact:
| |
John Kearney: Executive Chairman
| +1 416 362 6686 |
Terence McKillen: Chief Executive
| +1 416 362 8243 |
Danesh Varma: CFO & Company Secretary
| +44 (0) 8452 606 034 |
Peter McParland: Director - Ireland | +353 (0)46 907-3709 |
John Frain/Fergal Meegan: (NOMAD) Davy
| +353 (0)1 6796363 |
Barry Gibb: (Corporate Advisor | Broker) Beaufort International, London | +44 (0)20 7930 8222 |