Announces $500,000 Private Placement
- Agreement with Gecko Namibia (Pty) Ltd ("Gecko
Namibia") to acquire a majority interest in seven projects ranging
from exploration opportunities to near term feasibility
stage
- Diversifies Namibia Rare Earths Inc.'s single
commodity focus from heavy rare earths on the Lofdal project into a
broader portfolio of critical metals and minerals crucial for
electric vehicle industry including cobalt, lithium, graphite,
tantalum, niobium, and gold
- Initial focus will be on cobalt project following
discovery of stratabound cobalt-copper mineralization on
neighboring license in northern Namibia
- Strategic partnership formed with mineral development
and mining group, Gecko Namibia, strengthens operational capacities
for mineral processing and mine development
- Pine van Wyk (NHD Met.
Eng. B.Com, MBA), Managing Director of Gecko Namibia, will be
appointed CEO of Namibia Rare Earths Inc.
- Gecko Namibia and
Gerald McConnell, Chair of the Board
of Namibia Rare Earths Inc, to complete CDN$500,000 private placement
HALIFAX,
Nov. 10, 2017 /CNW/ -
Namibia Rare Earths Inc. ("Namibia Rare Earths" or the
"Company") (TSXV: NRE) today announced it has entered into an
agreement ("Agreement") to acquire a portfolio of critical metal
properties (the "Properties") from Gecko Namibia (Pty) Ltd. ("Gecko
Namibia") in consideration for the issuance of 64,000,000 common
shares of Namibia Rare Earths ("Property Acquisition").
In conjunction with the acquisition, Gecko Namibia and
Gerald J. McConnell, Chair of the
Board of Namibia Rare Earths, have each agreed to complete a
private placement with the Company in the amount of $250,000 at $0.05
per share for total gross proceeds to the Company of $500,000 ("Private Placement"). A total of
10,000,000 common shares of Namibia Rare Earths will be issued
pursuant to the Private Placement. The Private Placement is subject
to the approval of the TSXV.
This transaction provides Namibia Rare Earths with a high
quality, diversified portfolio of critical metals and at the same
time has secured a highly experienced strategic partner. Gecko
Namibia and its subsidiaries are
substantial participants in the Namibian resource sector with 327
employees and a proven track record in the mining industry. The
Gecko Namibia portfolio of properties will expand the Company's
commodity base from solely rare earths to a variety of highly
critical commodities including cobalt, copper, zinc, lithium,
graphite, tantalum, niobium, nickel, and gold. Ground holdings in
Namibia will increase from 221
km2 (Lofdal) to over 6,850 km2.
Property Acquisition and Private
Placement
Namibia Rare Earths has entered into an agreement with
Gecko Namibia to acquire its 95% interest in a portfolio of
exploration properties consisting of 14 exploration prospecting
licences ("EPLs") four of which are pending, one mineral deposit
retention licence ("MDRL") and Gecko Namibia's rights under an
option agreement to acquire a 60% interest in a further exploration
prospecting licence which interest may, subject to the terms of the
option agreement, be increased to 80%.
The Property Acquisition and Private Placement are
expected to close on or before January 31,
2018 and are subject to certain conditions including, but
not limited to, the receipt of all necessary approvals including
the approval and acceptance by the TSXV. Upon completion of the
Property Acquisition and Private Placement, Gecko Namibia will own
69,000,000 common shares of the Company representing 43.75% of the
outstanding common shares of the Company. The Property Acquisition
is further conditional upon receipt of the approval of shareholders
as required by the TSXV.
The proceeds of the Private Placement will be used to
carry out work on the properties acquired from Gecko Namibia with
an initial focus on advancing the Kunene cobalt-copper project and
to fund general corporate requirements. The common shares of the
Company issued pursuant to the Private Placement will be subject to
a four-month hold period.
Namibia Rare Earths and its insiders are at arm's length
with Gecko Namibia and there are no finder's fees payable in
connection with the Property Acquisition or the Private
Placement.
Following the closing of the Acquisition, Gecko Namibia
will nominate two members to the five-member board of Namibia Rare
Earths with Gerald McConnell
remaining as Chair. Pine van Wyk
will be appointed Chief Executive Officer of Namibia Rare Earths
based in Namibia and Donald Burton will remain as President. Dr.
Rainer Ellmies will be
appointed Country Manager of Namibia Rare
Earths (Pty) Ltd. based in Namibia.
Gecko Namibia – A
Strategic Partner
Gecko Namibia is a
private, Namibian-owned, fully integrated exploration and mining
company with diversified interests in Namibia. Headquartered
in Windhoek, the company and its
subsidiaries operate with a work force of 327 employees with a
professional management team of 24 people dedicated to every stage
of mineral resource development including exploration, mining,
mineral beneficiation and processing, and the provision of mine
services (drilling, blasting, laboratories, plant construction,
processing and contract mining).
Gecko Namibia and its
sister company Genet South Africa (Pty) Ltd. ("Genet") were founded
by Kobus Smit who is the Chairperson of
both groups. Genet is a similar resource focused company providing
mining and mineral processing services in South Africa with 703 employees and a team of
20 professional managers. The group also employs 285 people in its
various tourism related businesses.
Genet Mineral Processing introduced an innovative dry
process, using air clarification to upgrade coal for the South
African market, including to clients like Exxaro and Eskom. Mr.
Smit's entrepreneurial spirit has led to the establishment of a
diversified portfolio of business interests that include some of
the most valuable mining and tourism assets in private ownership
within the Southern African region. Most notably, in 2003 Mr. Smit
and his partners established a new coal mining company, namely
Umcebo Mining, which grew into a significant coal producer in
South Africa with annual
production of approximately 9MT. Over a period, 7 coal mines were
developed as greenfield projects, all with in-house capacity.
The success of Umcebo was mainly the result of innovative
technology in coal processing developed in-house that gave Umcebo
Mining a significant competitive advantage over other coal
producers. The most significant contract recently completed
was a coal supply agreement with Eskom to the value of R6.8
billion. In 2011 Glencore acquired a 41% share in Umcebo
Mining. Umcebo Mining was valued R2.2 billion at that time.
During 2017, Mr. Smit disposed of all his interest in Umcebo Mining
in order to focus on the expansion of his business interests in
Namibia.
The Portfolio – Diversification into Critical Metals
in Namibia
The transaction dramatically increases the Company's
exposure to a wide variety of critical metals and minerals at
various stages of development, providing a pipeline of projects
spanning the spectrum from near-term discovery to preliminary
economic assessment. All the projects are located in Namibia, a stable mining jurisdiction in which
the Company has operated for the past seven years and where
in-coming senior management have worked for over 20 years. This
diversification will provide the Company with considerable
flexibility in targeting those commodities which can provide
immediate shareholder value. The strategic partnership with Gecko
Namibia will allow for fast tracking to mine development as
projects mature to feasibility stage. The portfolio of eight
projects, their principal commodity targets and development stage
are summarized in Table 1 and more fully described below. Project
locations are shown in Figure 1.
1. Lofdal Heavy
Rare Earth Project
In terms of project maturity, Lofdal is the most advanced
with a 43-101 resource in place and completed Preliminary Economic
Assessment1. In 2016 the Company completed an
Environmental Impact Assessment and filed for an Environmental
Clearance Certificate from the Ministry of Environment and Tourism,
and concurrently filed for a Mining Licence with the Ministry of
Mines and Energy. Lofdal is a unique opportunity to develop a
relatively low cost, heavy rare earth mine that could produce
significant quantities of dysprosium, terbium and yttrium from the
principal mineral, xenotime. The project has very similar
mineralogical characteristics to the Brown's Range deposit in
Australia which is currently under
development by Northern Minerals (ASX:NTU) with AUS$97M of
financing in place to complete an initial three year pilot phase
operating at 72,000 tpa.
2. Kunene Cobalt-Copper
Project
In terms of commodity interest, the Kunene cobalt-copper
project offers the most attractive near-term value add opportunity
for the Company. The Kunene project builds upon the recent
exploration success led by Dr. Rainer
Ellmies to explore for "copper belt" style deposits in
northern Namibia. This work led to
the first recorded discovery of Copperbelt-type stratabound
cobalt-copper mineralization in Namibia in a sedimentary horizon termed the
dolomite ore formation ("DOF"). The mineralization is uniformly 5
to 10 meters thick, stratabound within a dolomitic shale horizon,
and averages around 0.5% copper and 1000-2000 ppm cobalt. The
initial discovery is currently under intense exploration by Celsius
Resources (ASX:CLA) including a 15,000 meter drill program to
complete a maiden JORC resource estimate by February 2018. As per Celsius Resources' press
release dated May 18, 2017 "Data from
the first 20 holes drilled across this 11 km zone has enabled the
Company to generate an Initial Exploration Target of between 33 and
41 million tonnes, grading approximately 0.13% - 0.17% cobalt and
0.45% - 0.65% copper. It is noted that the potential quantity and
grade is conceptual in nature, and that there has been insufficient
exploration to estimate a Mineral Resource, and it is uncertain if
further exploration will result in the estimation of a Mineral
Resource."
The Kunene cobalt-copper project comprises a very large
area of favourable stratigraphy contiguous with the DOF discovery
adjacent to the ground held by Celsius Resources. Secondary
copper mineralization over a wide area points to preliminary
evidence of a regional-scale hydrothermal system. Exploration
targets on EPLs held in the Kunene cobalt-copper project comprise
direct extensions of the DOF style mineralization to the west,
sediment-hosted cobalt and copper, orogenic copper, and stratabound
Zn-Pb mineralization. Most of the occurrences are likely spatially
related to what Dr. Ellmies' geological team has interpreted as a
large hydrothermal center termed the Steilrand hydrothermal system.
There is considerable scope for further discoveries both along
strike of the Celsius discovery and in equivalent stratigraphy
elsewhere on the property. Initial investigations will trace the
western extension of the DOF which may continue for over 10 km in
the project area, and will follow up on numerous copper-cobalt
targets drilled in the past but never analysed for
cobalt.
3. Black Range Graphite
Project
The Black Range flake graphite prospect was discovered in
the late 1980's and was explored by Rossing Uranium Ltd. between
1988 and 1992. Rossing interpreted the graphite horizon in a fold
structure with a total strike length of about 8 km. Based on 3,821
m of percussion drilling and 3,931 m of diamond drilling from a 1
km segment of the horizon, employing a cut-off grade of 2%
graphitic carbon and using the polygonal section method, an
historical estimate of 12.46 MT grading 4.63% graphitic carbon was
utilized by Rossing to assess the project (reference "The Black
Range Graphite Deposit, Feasibility Study Final Report" dated
August 1992). This historical
estimate does not cite reference to CIMM Definition Standards on
Mineral Resources and Mineral Reserves. Additional drilling and
sampling will be required to validate the historic database. A
qualified person has not done sufficient work to classify the
historical estimate as current mineral resources or mineral
reserves and this historical estimate is not being treated as a
current mineral resource or mineral reserve. Preliminary mining
plans were drawn up and preliminary metallurgical work was carried
out by Mintek of South Africa but
the project was terminated before the flowsheet was fully optimized
when the decision was made to focus instead on the graphite deposit
at Okanjande. Okanjande was brought into production in 2017 by
Gecko Namibia in a joint venture with Imerys.
Black Range is slightly lower grade than the producing
Okanjande Graphite Mine (but the potential resource is much larger
than the 1 km of strike length that has been tested to date. The
data cannot be used in its present form for reporting under JORC or
NI 43-101, however a similar problem was encountered at Okanjande
and was addressed by a program of twinning of old drill holes and
assaying of the core with full QAQC. That work largely validated
the Rossing work so it should not be necessary to re-drill all the
holes at Black Range. The near-term focus will be on metallurgical
test work and, with a viable flowsheet, the project could be taken
rapidly to a compliant PEA stage.
4. Warmbad Lithium
Project
The Warmbad project is located in southern Namibia near the South African border in an
area of historic small-scale pegmatite mining known as the
Tantalite Valley. The Tantalite Valley pegmatites have been mined
since about 1946 for beryl, columbite-tantalite, lithium and
bismuth minerals. Mining has been re-activated by Kennedy Ventures
Plc who control African Tantatite (Pty) Ltd. and are producing
concentrates of >40% Ta2O5 being sold into
global markets. Initial production of 20M tpa concentrate is
ramping up to 120M tpa. An initial lithium resource estimate is
being prepared by MSA Group for early 2018 following the sampling
of lepidolite bearing pegmatites grading >1.6%
Li2O.
The Warmbad EPL covers 605 km2 and hosts three
pegmatite occurrences of undetermined extent from government maps.
There are no records of any systematic exploration over the EPL.
The area has recently been mapped by the Geological Survey of
Namibia and the Council of
Geosciences (South Africa) which
has provided updated geological information. A key result of the
mapping campaign is the delineation of previously unknown
extensive pegmatite swarms of up to 13 km strike length. None
of these pegmatites have ever been sampled and
assayed. This new data will be utilized to undertake
systematic sampling of the pegmatites.
5. Epembe Tantalum-Niobium
Project
Epembe is an advanced stage exploration project with a
well-defined, very large multiphase carbonatite dyke that has been
mapped and sampled at surface over a strike length of 10 kilometers
of which at least 7 km of strike length is mineralised. Gecko
Namibia has completed detailed
mapping and over 11,000 meters of drilling on the dyke, with
preliminary mineralogical and metallurgical studies. The
carbonatite contains variable concentrations of pyrochlore which is
unusually enriched in tantalum. The other commodities of interest
are niobium (hosted in pyrochlore) and apatite. Drilling covered
only 15% of the pyrochlore hosting carbonatite. Grades of the
drilled portion of the carbonatite average on the order of 150 ppm
Ta2O5, 1,300 ppm Nb2O5
and 2.4% P2O5. Initial sorting tests (XRT)
indicate the potential for significant physical upgrading. Planned
work will focus on improving grade by optimizing XRT sorting and
investigating amenability to XRF sorting. There is potential to
delineate a substantial open pit resource by further exploration,
both by extending known mineralized zones along strike and
vertically.
6. Grootfontein Nickel-PGE
Project
Grootfontein is an early stage conceptual target based on
geophysical and historical evidence for a large buried
mafic-ultramafic intrusive complex. It is a poorly explored
geological complex due to the extensive coverage with Kalahari
sands and calcrete.
Based on historic drill holes and airborne magnetic survey
interpretations, Grootfontein constitutes a huge mafic complex
covering 360 km2 with the potential to host magmatic
nickel, copper, vanadium, platinum group elements and chromite
mineralisation as cumulates or late magmatic disseminations and
stockworks. Previous work by Ongopolo Mining proved that the main
intrusive phases are depleted in nickel and copper. The metals were
likely fractionated as sulphides during the intrusive phase,
gravitationally accumulated in the magma and intruded in the
adjacent, preexisting rocks. As in other mafic hosted copper-nickel
deposits such as Norilsk and Voisey's Bay, sulphidization by
scavenging of sulphur from country rocks and tectono-magmatic
concentration of the sulphide-rich melts are the key for the
formation of this type of magmatic copper nickel deposits. Only two
shallow drill fences (total of 1,386 m) were drilled by
Anglo American in 1988 leaving 55 km
of strike length untested.
There is also potential for zinc-lead-vanadium
mineralisation of the Berg Aukas type where dolomite-hosted
deposits bordering the mafic complex, which according to historical
records, produced 1.6 MT of ore grading 16.77% Zn, 4.04% Pb and
0.93% V2O5 during the period
1967-1975.
7. Otjiwarongo Carbonatite
Project
Otjiwarongo is another early stage conceptual target based
on remote sensing data in proximity to known alkaline intrusive
complexes, most notably the Okorusu complex which hosts the Okorusu
fluorspar deposits. The area of interest is completely hidden by
cover. The circular anomaly measures one kilometer in diameter and
can be easily tested by drilling to determine if in fact a
carbonatite body is the source and what styles of mineralization
might be associated with it (fluorspar, rare earths, tantalum,
niobium etc.).
8. Erongo Gold
Project
The Erongo gold project covers an area of over 600
km2 within the
Navachab-Ondundu gold trend. There are numerous mineral occurrences
within the project area including at least two gold occurrences.
The area has been prospected but not systematically explored.
Potential targets include skarn and greisen gold-(copper-bismuth)
and tin-tungsten mineralization; pegmatites formed during the late
Damaran orogeny hosting lithium minerals and semi-precious stones
and structurally controlled gold mineralisation. Historical figures
indicate small scale mining for all of those deposit types on the
property.
Project Management Strengthened – Operational
Experience Focused on Namibia
Operations in Namibia for
all projects will continue under Namibia Rare Earths (Pty) Ltd.,
the Namibian operating company of Namibia Rare Earths. Project
management will be streamlined through utilization of Gecko
Namibia's in-country administrative and service providers drawing
upon the resources of the following senior personnel:
Pienaar-Schalk (Pine) van Wyk (NHD
Met. Eng. B.Com, MBA), Managing Director of Gecko Namibia will be
appointed Chief Executive Officer of Namibia Rare Earths based out
of Namibia. Pine joined Gecko in
2008 bringing over 25 years of extensive process and project
management experience to the Gecko Group. Prior to joining Gecko
Namibia he worked for Rossing Uranium as Engineering Manager and
later with Paladin Energy at the Langer Heinrich uranium mine where
he held the positions of Operations Manager and Business
Development Manager. As Managing Director for Gecko Namibia, Pine
has developed a strong network of contacts throughout the mining
sector and with government agencies in Namibia. In addition to his professional
qualifications as a Metallurgical Engineer from Tshwane University
of Technology (Pretoria), Pine
holds a Bachelor of Commerce from the University of South Africa and Masters of Business
Administration from University of Bloemfontein with a focus on
project management.
Rainer Ellmies, PhD., General Manager
of Gecko Exploration since 2016, will be appointed Country Manager
of Namibia Rare Earths (Pty) Ltd. based out of Namibia and will carry principal
responsibility for the design, implementation and development of
all projects through to feasibility stages. Rainer has been
instrumental in assembling the property portfolio for Gecko Namibia
and has been directly involved in a number of significant mineral
deposit discoveries in Namibia
including the heavy rare earth deposit at Lofdal, Namibia's first sediment-hosted cobalt deposit
at Opuwo, tantalum-niobium at Epembe, copper, zinc-lead-barite in
the Kunene region and light rare earths at Keishöhe/Dicker Willem.
Rainer brings a combination of extensive technical and commercial
skills as well as in-country knowledge of Namibia's mineral sector through his
seven-year tenure as Manager of German-Namibian Development
Cooperation in the Namibian Ministry of Mines and Energy. Rainer
received his Ph.D. and M.Sc. in Economic Geology from the Technical
University of Berlin.
Other Interests within Gecko
Namibia
Graphite Mine in
Production
Gecko Namibia was
instrumental in bringing the 500,000 tpa run of mine Okanjande
Graphite Mine into commercial production in 2017 through a joint
venture partnership with Imerys, a global leader in the production
of mineral-based, high value specialty products. Gecko Namibia re-designed a portion of the crushing,
milling and flotation facilities at the Okorusu Mine for graphite
processing of up to 20 000 tpa of graphite concentrate.
Fluorspar Mine and Processing Facilities
Gecko Namibia acquired
all the mine and processing facility assets of the Okorusu
Fluorspar Mine from Solvay in 2016. A comprehensive test program
has been developed with the objective of re-opening the fluorspar
operations at Okorusu. Gecko Namibia envisages a metallurgical process with
dual product output of high grade acid spar and low grade
metallurgical spar, following on-going mineralogical studies of all
ore bodies, gravity separation tests and high-end flotation tests.
Okorusu produced close to 1.8 million tons of fluorspar
concentrates over a 27-year period between 1998-2014, when Solvay
made the corporate decision to close down its global mining
division.
Various Salts and Limestone Operations
Gecko Salt, a subsidiary of Gecko Namibia, operates a
small-scale salt production plant located approximately 120
kilometers north of the coastal town of Swakopmund. The project is
currently operating at a rate of 200,000 tpa and targeting to
increase to 1,000,000 tpa. The first shipment of 25,000 t of salt
for the North American market was exported in August 2017.
An internal assessment has been completed over portions of
the Otjivalunda salt pans, located north of Etosha National Park,
which comprise natural deposits of burkeite, thenardite and sodium
sulphate. Gecko Salt intends to initially produce approximately
100,000 tpa of sodium sulphate as well as washing powder, soap and
other salt products for sale into the South African
market.
An internal resource of 5 million tons of high-quality
white marble with >98% calcium carbonate has been defined by
drilling near Swakopmund together with an internal resource in
excess of 25 million tons of calcitic marble rock for a calcining
project. An Environmental Impact Assessment for the project
has been completed and the company has received the Environmental
Clearance Certificate.
Industrial Corporate Vision
Gecko Namibia envisions
substantial industrial growth for Namibia, in part through the realization of
its multi-faceted resource portfolio. To this end, Gecko Namibia
has initiated two high level projects related to industrial
development in the Swakopmund-Walvis Bay area.
An application for the development of a 200 ha industrial
park named Nonidas Industria to be located 11km east of
Swakopmund is at an advanced stage. The site is uniquely situated
between the B2 National Highway and the main TransNamib railway
leading inland from Walvis Bay and Swakopmund. The Vision
Industrial Park (VIP) is a much larger concept that has been
proposed by Gecko Namibia to develop a new deep-water port with an
associated industrial development zone to be situated 25 km north
of Swakopmund. The Namibian Cabinet awarded Gecko Namibia the right
to develop a private port together with 700 ha of industrial land
for the development of chemical and mining related industries. The
port will be designed to accommodate Panama size vessels and have the capacity to
handle 5-10 million tons of cargo volume per annum. The concept is
very similar to the Coega Project of South Africa where an industrialized
development zone was created with a dedicated port facility in
2009. Since its inception, Coega has attracted 54 industrial firms
that have brought in over R30 billion in investments.
Donald M. Burton, P.Geo.
and President of Namibia Rare Earths Inc., is the Company's
Qualified Person and has reviewed and approved this press
release.
About Namibia Rare Earths Inc.
Namibia Rare Earths Inc. is focused on the accelerated
development of the Lofdal Rare Earths Project and on building a
critical metals portfolio in Namibia. The common shares of Namibia Rare
Earths Inc. trade on the TSX Venture Exchange under the symbol
"NRE".
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.
The foregoing information may contain forward-looking
information relating to the future performance of Namibia Rare
Earths Inc. Forward-looking information, specifically, that
concerning future performance, is subject to certain risks and
uncertainties, and actual results may differ materially. These
risks and uncertainties are detailed from time to time in the
Company's filings with the appropriate securities
commissions.
______________________________
1 Preliminary Economic Assessment on the
Lofdal Rare Earths Project Namibia dated
October 1, 2014 authored by
David S. Dodd, B. Sc (Hon) FSAIMM -
The MDM Group, South Africa,
Patrick J.F. Hannon, M.A.Sc., P.Eng.
and William Douglas Roy, M.A.Sc.,
P.Eng. - MineTech International Limited, Canada, Peter Roy
Siegfried, MAusIMM (CP Geology) and Michael R. Hall, B.Sc (Hons), MBA, MAusIMM,
Pr.Sci.Nat, MGSSA - The MSA Group, South
Africa
SOURCE Namibia Rare Earths Inc.