- 40% increase in Mineral Reserves to 18.3618.4 million tonnes
Proven and Probable Mineral Reserves with an average grade of 1.17%
V2O5
- Retrospective 51% increase in aggregate tonnage when factoring
in tonnage milled to date
TORONTO, May 26, 2016 /CNW/ - Largo Resources Ltd.
(TSX-V:LGO) (OTCQB: LGORF) ("Largo" or the "Company")
is pleased to announce a 40% increase in the mineral reserves for
the Campbell Pit at its Maracás Menchen Vanadium Mine in Bahia,
Brazil (the "Maracás
Project") and a new mine plan for the Maracás Project. The
update, prepared by Whittle Consulting ("Whittle"), Micon
International ("Micon") and RungePincockMinarco
(Canada) Ltd. ("RPM"), has
increased the proven and probable mineral reserves for the Maracás
Project to 18.4 million tonnes from the 13.1 million tonnes
established previously in the 2008 definitive feasibility study
(the "Feasibility Study") for the project (updated in 2009)
by Aker Metals, a division of Aker Solutions Canada Inc.
("Aker") (see Largo news release dated August 12, 2008). The new mine plan, based on the
production of vanadium pentoxide
("V2O5") and larger mineral reserves,
results in an operating life of the Maracás Project and process
plant of 15 years at a 9,600 tonnes V2O5 per
annum production rate.
Highlights of the Updated Maracás Project Mine Plan and Mineral
Reserves:
- 40% increase in Proven and Probable Mineral Reserves to 18.4
million tonnes, at a grade of 1.17%
V2O5.
- Retrospective increase of 51% in aggregate tonnage when
factoring in tonnage mined to date.
- Mine life of 15 years.
- The ore averages 29.5% magnetics (magnetite) which yields an
average concentrate grade of 3.32% V2O5.
- New mine plan to produce V2O5 flakes
rather than ferrovanadium ("FeV") to improve project
economics and allow faster ramp-up of production.
Mr. Mark A. Smith, President and
Chief Executive Officer of Largo stated: "We are very pleased with
the updated reserve as it continues to demonstrate the robust
nature of the project. The reserve supports the high performance of
our operation." He further stated: "The reserve is the result of
our greater understanding and knowledge of the orebody, and the
next phase of our work will be to systematically upgrade the
resources in the satellite deposits in order that they may
contribute to the expansion of the project."
A technical report under National Instrument 43-101 –
Standards of Disclosure for Mineral Projects ("NI
43-101") which will incorporate the updated mine plan and
mineral recovery estimate is being prepared by Whittle, Micon and
RPM and will be filed on SEDAR at www.sedar.com and on Largo's
website at www.largoresources.com within 45 days from the date of
this press release.
Maracás Project Mineral Reserves:
The table below provides a summary of the fully diluted mineral
reserve for the Gulcari A deposit with an effective date of
March 31st, 2016. The
details are as follows:
Campbell Pit
Reserve
Category
|
Tonnage
(tonnes)
|
%V2O5
Head
|
%Magnetics1
|
%V2O5
con1
|
Mag V2O5 Content
(kt)
|
Proven
|
17,149,000
|
1.17
|
29.6
|
3.33
|
168.8
|
Probable
|
1,243,000
|
1.13
|
29.0
|
3.19
|
11.5
|
Total Reserve
|
18,392,000
|
1.17
|
29.5
|
3.32
|
180.3
|
Waste
|
62,005,000
|
|
|
|
|
Total in-Pit
|
80,397,000
|
Strip Ratio
= 3.37
|
|
|
|
1 Grades as determined by Davis Tube and XRF
Analyses, reported from a fully diluted reserve block model.
The mineral reserves for the Maracás Project were updated in
compliance with NI 43-101 and CIM guidelines by Micon. Micon has
created a regularized (and diluted) reserve model from the GEMS
resource model for which Robert
Campbell, P.Geo., Vice President, Exploration for Largo
Resources Ltd., Largo QP, is responsible.
This mineral reserve estimate for the Maracás Project is based
solely on the measured and indicated resources from within the
redesigned Campbell Pit (Gulcari A deposit). The inferred resources
for Gulcari A and the resources of the satellite deposits are not
included. These resources have been outlined in a press release
dated January 18, 2013 and in a
technical report dated March 4,
2013.
The V2O5 price used for this mineral
reserve is US$5.00 per pound of
V2O5 and the application of an overall
recovery of 66.5% from the magnetic V2O5
content, which results in proven and probable reserves of 18.4
million tonnes at 1.17% V2O5. This represents
a 40% increase in tonnage and 13% decrease in average grade
compared to the Feasibility Study. The lower average reserve grade
is due in part to the use of dry magnetic separators which make
lower grade material economic by rejecting up to 30% of the mass
while raising the V2O5 grade of mill
feed.
A total of 2,283,829 tonnes of ore at an average grade of 1.24%
V2O5 have been mined at the Maracás Project
from commencement in September
1st, 2013 to March
31st, 2016. Of this, 1,336,829 tonnes was sent to
the crusher, 717,000 tonnes was stockpiled to be blended later and
230,000 tonnes was moved to waste. Incorporating only the tonnage
sent to the crusher to date demonstrates a retrospective 51%
increase in the tonnage over the Feasibility Study production
plan.
The ore on average contains approximately 29.5% magnetics
yielding an average concentrate grade of 3.32%
V2O5 as determined by Davis Tube and XRF
analyses. All samples from the exploration programs have been
analyzed by Davis Tube and XRF allowing for more detailed mine
planning and enhancing the reliability of production forecasts.
The base case price of US$5.00/lb
V2O5 used in the updated mineral reserves
equates to the three year trailing average pricing from Metal
Bulletin (www.MetalBulletin.com), a widely accepted reference
source for minor metals pricing and industry information.
Chris Jacobs, CEng, MIMMM, MBA,
Vice President & Mining Economist and Dayan Anderson, B.Sc.,
MMSA, Senior Mining Engineer, Micon International Limited and Kevin
Tanas, P. Eng., Principal Mining Consultant, RungePincockMinarco
(Canada) Ltd, are the Qualified
Persons responsible for the updated mineral reserves as defined by
NI 43-101. Robert Campbell, P.Geo.,
Vice President, Exploration for Largo Resources Ltd, is the
Qualified Persons responsible for the Resources.
Revised Mine Plan:
The updated mineral reserves can support a 15-year mine life
with annual mill throughput of 1,118,880 tonnes to produce up to
9,600 tonnes of V2O5 per year. These
represent increases of 90% and 92%, respectively, over the mill
throughput and production in the Feasibility Study. The revised
mine plan demonstrates a 15-year V2O5
production case and requires no additional capex. This approach
provides the existing plant a great deal of flexibility to
accommodate additional resources that Largo expects will become
available in the areas of the satellite deposits identified by the
2011/2012-drill program and outlined in the 2013 preliminary
economic assessment for the project by RungePinockMinarco (see
Largo's news releases dated January 18,
2013).
Quality Assurance Quality Control:
The scientific and technical information in this press release
has been reviewed and approved by Robert
Campbell, P.Geo., Vice President, Exploration for Largo
Resources Ltd, Dayan Anderson, B.Sc., MMSA, Senior Mining Engineer,
Micon International Limited, Chris
Jacobs, CEng, MIMMM, MBA, Vice President & Mining
Economist, Micon International Limited and Kevin Tanas, P. Eng.,
Principal Mining Consultant, RungePincockMinarco (Canada) Ltd., all of whom are Qualified
Persons as defined by NI 43-101.
About Largo
Largo (TSX-V: LGO) is a growing strategic mineral company
focused on the production of vanadium pentoxide at its Vanadio de
Maracás Menchen Mine. Largo also has interests in a portfolio of
other projects, including: a 100% interest in the Currais Novos
Tungsten Tailings Project in Brazil; a 100% interest in the Campo Alegre de
Lourdes Iron-Vanadium Project in Brazil; and a 100% interest in the Northern
Dancer Tungsten-Molybdenum property in the Yukon Territory, Canada.
Vanadium is primarily used as an alloy to strengthen steel and
reduce its weight. Vanadium enhanced steels are used in a vast and
growing range of products that are used and encountered every day;
including, rebar, automobiles, transport infrastructure etc. With
consumption increasing at a compound annual growth rate of over 8%
for the past several years (Roskill, 2015), vanadium is a
bourgeoning commodity which lacks opportunities for investment in
the wider market place. As trends in the steel industry now demand
increasingly stronger and lighter products for advanced
applications, the use of vanadium is expected to continue this
growth over the medium and long term.
Largo is listed on the TSX Venture Exchange under the symbol
"LGO".
For more information please refer to Largo's website:
www.largoresources.com
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Disclaimer:
This press release contains forward-looking information under
Canadian securities legislation. Forward-looking information
includes, but is not limited to, statements with respect to
completion of any financings; Largo's development potential and
timetable of its operating, development and exploration assets;
Largo's ability to raise additional funds necessary; the future
price of vanadium, tungsten and molybdenum; the estimation of
mineral reserves and mineral resources; conclusions of economic
evaluation; the realization of mineral reserve estimates; the
timing and amount of estimated future production, development and
exploration; costs of future activities; capital and operating
expenditures; success of exploration activities; mining or
processing issues; currency exchange rates; government regulation
of mining operations; and environmental risks. Generally,
forward-looking statements can be identified by the use of
forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or statements
that certain actions, events or results "may", "could", "would",
"might" or "will be taken", "occur" or "be achieved". All
information contained in this news release, other than statements
of current and historical fact, is forward looking information.
Forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of the Largo to be
materially different from those expressed or implied by such
forward-looking statements, including but not limited to those
risks described in the annual information form of Largo and in its
public documents filed on SEDAR from time to time.
Forward-looking statements are based on the opinions and
estimates of management as of the date such statements are made.
Although management of Largo has attempted to identify important
factors that could cause actual results to differ materially from
those contained in forward-looking statements, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove
to be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements. Largo does not undertake to update any forward-looking
statements, except in accordance with applicable securities laws.
Readers should also review the risks and uncertainties sections of
Largo's annual and interim MD&As.
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SOURCE Largo Resources Ltd.