TORONTO, ONTARIO — (Marketwire) — 07/04/12 — Pele Mountain Resources Inc. (TSX VENTURE: GEM)(OTCQX: GOLDF) („Pele“ or the „Company“) today announced the filing of its updated NI 43-101 Preliminary Economic Assessment (the „PEA“) on its Eco Ridge Mine Rare Earths and Uranium Project („Eco Ridge“ or the „Project“). The PEA was prepared by Roscoe Postle Associates Inc. („RPA“) and demonstrates that Eco Ridge has excellent potential to become a profitable producer of rare earth oxides („REO“) and uranium oxide („U3O8“).
Since publication of its previous PEA in July 2011, Pele has pursued opportunities for processing improvements at Eco Ridge. As reported in , the updated PEA demonstrates that the predominant monazite rare earth mineralogy allows for excellent recovery with acid baking methods, improving recoveries by more than 10-fold for Light REO, by more than double for Heavy REO, and by nearly 30-percent for U3O8. The projected financial benefits from sharply higher rare earth recoveries far outweigh associated capital and operating cost increases and more conservative forecast commodity pricing.
Pele President and CEO Al Shefsky stated: „Our updated PEA demonstrates that Pele is a clear leader in the ongoing race to develop new sources of critical rare earths outside of China. As development timelines continue to slip at several well-known REO projects, we believe that the competitive advantages of Eco Ridge are increasingly apparent and attractive. We are pleased to publish our updated PEA and anticipate completing our updated Project Description during the current quarter in preparation for commencement of the licencing process.“
Eco Ridge has competitive advantages that may enable its development ahead of other REO projects, including:
Operational highlights of the updated PEA include:
Financial highlights of the updated PEA include (all terms in US$):
The economic analysis is based, in part, on Inferred Resources, and is preliminary in nature. Inferred Resources are considered too geologically speculative to have mining and economic considerations applied to them and to be categorized as Mineral Reserves. There is no certainty that economic forecasts on which this Preliminary Economic Assessment is based will be realized.
An extended mine life sensitivity analysis demonstrates the economic potential of a longer mine life at Eco Ridge. RPA examined the effect of extending the mine life with the inclusion an additional 50 million tonnes of production material from the MCB. At a 9000 tonne per day production rate, the mine life is extended to 25 years and the resulting Project NPV is C$1.7 billion (at a 10% discount rate) and the IRR is 51-percent. At a 12,000 tonne per day production rate, the mine life is extended to 20 years, the NPV is C$2.1 billion (at a 10% discount rate) and the IRR is 53%.
For additional details regarding the updated PEA, please see . To view or download the entire PEA, please visit Pele-s website at .
Pele is committed to the pursuit of sustainable development in Elliot Lake and seeks to provide long-term benefits to local communities. The Pele Board, management team, and staff offer their deepest condolences and unwavering support to the people of Elliot Lake as the community recovers from the recent Algo Centre Mall tragedy.
The technical and economic information relating to the PEA contained in this press release has been reviewed and approved by Jason Cox, P. Eng., Director of Mine Engineering for RPA, an independent qualified person under NI 43-101. This press release has been reviewed and approved by Roger Payne P. Eng., Pele-s Executive Vice President and a Qualified Person under NI 43-101.
About Pele
Pele Mountain Resources, a leader in Canadian rare earth development, is focused on the sustainable development of its 100-percent owned Eco Ridge Mine Rare Earths and Uranium Project. Eco Ridge is located in Elliot Lake, the only Canadian mining camp to have ever achieved commercial REO production. At one time, Elliot Lake supplied 35-percent of the world-s yttrium. With well-understood geology, mineralogy, and metallurgy, excellent regional infrastructure, and strong local support, Eco Ridge is an ideal location for a safe, secure, and reliable long-term supply of REO and U3O8. Pele has also entered into an agreement to purchase the Simon Rare Earth Claims in Mountain Pass, California. Pele-s shares are listed on the TSX Venture Exchange under the symbol „GEM“ and on the OTCQX under the symbol „GOLDF“.
Some of the statements contained in this release are forward-looking statements, such as estimates and statements that describe Pele-s future plans, objectives or goals, including words to the effect that Pele 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. The economic viability of the 43-101 mineral resource at Pele-s Elliot Lake Project has not yet been demonstrated by a preliminary feasibility study.
Shares Outstanding: 148,951,246
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.
Contacts: Pele Mountain Resources Inc. Al Shefsky President (800) 315-7353
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