August 19, 2014
August 19, 2014 — Commerce Resources Corp. (TSXv: CCE, FSE: D7H, OTCQX: CMRZF) (“Commerce” or the “Company”) is pleased to provide an update on its metallurgical flowsheet for the Ashram Rare Earth Deposit, including an outline of recommended next steps and potential end-products to be targeted by these steps.
Overall, the Company continues to advance the Ashram Project towards completion of its Prefeasibility Study. This work includes the results of recently reported infill drilling (see news release: July 2nd, 2014), and the metallurgical programs being conducted at UVR-FIA GmbH (UVR) in Germany and Hazen Research Inc. (Hazen) in Denver, CO.
Commerce President David Hodge states: “We are again very encouraged by the successful usage of the conventional and low-cost techniques detailed in the Ashram flowsheet. This testwork has produced one of the highest grade mineral concentrates in the REE sector and we believe that our current results are the most logical indicators of Ashram’s potential for positive downstream economics. We look forward to the results from the next phase of metallurgical testing and to a better definition of our costs to produce final end products”.
The Company is pleased to report that it has now confirmed the mineral processing flowsheet with the flotation + leach + Wet High Intensity Magnetic Separation (WHIMS) process (reported previously December 4th 2013), at the bench scale. Further, the flowsheet has proven to be repeatable for the production of high-grade mineral concentrates (>40% Total Rare Earth Oxide, “TREO”) using industry standard techniques applicable at the commercial scale.
The objective going forward is to optimize specific aspects of this mineral processing flowsheet. At the same time Commerce intends to initiate downstream processing studies directed firstly towards the production of a cerium-lanthanum depleted, and thorium free, mixed rare earth carbonate (REC) concentrate. This is one of many potentially saleable products which might be produced. It is the preferred feed stock for numerous global rare earth element (REE) processors. The company will also evaluate the production of select separated oxides as final products.
What follows is a synopsis of the mineral processing and hydrometallurgical (hydromet) testwork carried out to date. Specific highlights:
- Bench scale test confirmation of the mineral processing flowsheet with demonstrated reproducibility of flotation, HCL leach, and WHIMS components.
- Additional mineral concentrate of 41% TREO at 70% recovery and 3% mass pull was produced during repeat testing (See news release December 4th, 2013 which details first production of a 44% TREO mineral concentrate at 71% recovery)
- A conceptual hydrometallurgical flowsheet was designed, and partially tested at bench scale, to produce a representative mixed rare earth oxide (REO) / (REC) as a potential saleable product.
- Demonstrated sulphation roast and pot digestion tests on high-grade mineral concentrate (>40% TREO), to put REE into solution, with staged TREO recoveries of 87% and 93%, respectively, at low acid consumptions.
- Demonstrated removal of deleterious Th from the circuit using industry standard methods.
- Demonstrated that flotation tailings have significant capacity to neutralize leach liquor, suggesting there may be no process need for costly lime as a neutralizing agent.
- UVR-FIA and Hazen Research reports (which include high level data review of test work to date) provide recommendations and outline optimization testing for the next phase of work.
Only ~3% of the whole rock material at Ashram is expected to require downstream hydromet processing due to the significant upgrading of the whole rock through to a >40% TREO mineral concentrate prior to the hydromet stage, and based upon the mass reduction of ~97%. This will result in considerable reductions in capital (CAPEX) and operating expenditures (OPEX).
Conceptualized Flowsheet through to Saleable Product(s)
The Ashram flowsheet has been bench scale demonstrated through to dissolution of the mineral concentrate, creating a pregnant liquor solution (termed “PLS”) at a high recovery. This is a significant milestone in the process towards a potentially saleable product (see below for details).
The remainder of the hydromet flowsheet has now been fully conceptualized and designed to refine the PLS into a potentially saleable mixed REO/REC product. This includes the removal of Ce and La as separate potentially saleable product(s), thereby, significantly increasing the value of the primary mixed REO/REC concentrate (i.e. an increased “basket price”). A mixed REO/REC concentrate is seen as a major milestone for the Company as it is a basic, relatively purified, feed stock for REE separation facilities, in and outside, of China. Ability to purchase such a concentrate aligns well with the interests of potential Joint Venture Partners who have excess separation capacity and need a concentrate source.
Further, due to the high-grade nature of the Ashram mineral concentrates that are dissolved into solution (PLS), the impurity content is relatively low. Low impurities allows for more options and a potentially simpler means of downstream processing into relatively pure saleable product(s).
There is a large array of intermediate and potentially saleable products that may be considered as an economic alternative to individually separated REO (SREO). Although SREOs bring a premium price at market, they are also the most difficult, as well as costly, to produce. Production of an intermediate product suite is a common method of passing substantial CAPEX and OPEX to a third party that would complete the final refining to end-user specifications. A few of the many base (mixed) and intermediate product (i.e. partial separation) options (representing only a small percentage of that available) are listed as follows:
- Mixed rare earth oxide (REO)
- Mixed rare earth chloride
- Mixed rare earth carbonate (REC)
- Ce oxide, mixed REO/REC
- Ce-La oxalate, mixed REC (i.e. Ce-La depleted, Th free, mixed REC concentrate targeted by the Company)
- Ce oxide, Eu oxide, mixed REO
- Mixed LREO (La, Ce, Pr, Nd), mixed MHREO (Sm, Eu, Gd, Tb, Dy, Ho, Er, Tm, Yb, Lu, Y)
- Mixed LREO (La, Ce, Pr, Nd), mixed MREO (Sm, Eu, Gd), mixed HREO (Tb, Dy, Ho, Er, Tm, Yb, Lu, Y)
- La oxide, Ce oxide, Pr-Nd oxide (didymium), mixed MHREO
- La oxide, Ce oxide, Pr-Nd oxide (didymium), mixed MREO, mixed HREO
- La oxide, Ce oxide, Pr-Nd oxide (didymium), Sm oxide, Eu oxide, Gd oxide, mixed HREO
The versatility afforded by Ashram’s high-grade mineral concentrates (i.e. lower-cost downstream processing and limited impurities), allows for a greater number of potentially saleable products to be evaluated. Such versatility is sought after by potential Joint Venture Partners interested in partial/intermediate products. Options for partial separation will be evaluated as part of the next phase of hydromet work.
Additionally, Commerce expects to evaluate the production of a range of separated oxide products, with a focus on the five critical REOs (CREOs) that the Ashram Deposit is enriched in. Final products such as neodymium oxide, europium oxide, terbium oxide, dysprosium oxide, and yttrium oxide would be attractive to a large number of end users and potential joint venture partners. They are therefore seen as viable commercial targets for the next stages of hydrometallurgical investigation.
Dissolution of the Mineral Concentrate (i.e. putting the REEs into solution)
Two tests were completed to dissolve the high-grade Ashram mineral concentrate, putting all REEs into solution (PLS): a sulphation roast, and a pot digestion.Recoveries into solution for this stage were 87% and 93%, respectively, for total recoveries into solution (flotation + leach + WHIMS + roast/digestion) of 62% and 65%. Most importantly, only ~2-3% of the whole rock mass is put into solution for final processing, dramatically reducing costs while simplifying the downstream processing due to fewer impurities. Test data, with cumulative totals, can be viewed in the following chart (please click on chart for expanded version):
Acid consumptions in the hydromet work have been very low owing to the high-grade mineral concentrate feed. For the HCl leach (100% basis), 90 kg/t is consumed (relative to whole ore) with the sulphuric acid consumption from the sulphation roast and pot digestions at 30 kg/t and 120 kg/t respectively (relative to whole ore). Acid recycling/regeneration has not been incorporated into the current flowsheet and will be a focus of optimization going forward. Further reductions in acid consumptions are anticipated as the methods for acid recovery in such systems are well-established.
Flotation Tailings as an Effective Neutralization Agent
Recent testwork has demonstrated that the flotation tailings have a significant capacity to neutralize leach liquor, strongly suggesting that lime will not be required as part of the neutralization process steps. As many REE projects require a considerable amount of lime, at significant cost of purchase/shipping/storage, to neutralize liquors as part of their flowsheet, this is an important potential cost reduction.
Benchmarking against Operating REE Mines: Mineral Concentrate Requirements and Demonstrated Repeatability
Ashram’s metallurgical work to date has had the objective of generating the highest grade mineral concentrate possible, at high recovery, and doing so with demonstrated repeatability. This objective is rooted in the reality that, apart from the ion-absorbed clay deposits of South China, all major producing REE mines globally (Mountain Pass, Mount Weld - CLD, Bayan Obo, Kamasurt/Lovozero, Maoniuping, and Weishan)operate with a minimum 30% TREO mineral concentrate for downstream processing. This strongly indicates that a >30% TREO mineral concentrate is a baseline requirement for economic operation of any non-ionic clay rare earth mine. Please note the illustration below (please click on the image for expanded version):
Commerce has confirmed that Ashram’s base mineral processing flowsheet can reliably produce one of the highest grade (if not the highest) mineral concentrates in the entire REE project development sector. The highest TREO grade mineral concentrates already produced from the Ashram Deposit may be viewed below (please click on chart for expanded version):
To date, no optimization testing has been completed (e.g. temperature, pH, reagent dosage, etc.). This suggests that significant scope remains for increased recovery. The next steps of optimization work will proceed in parallel with increasing focus on the production of a variety of potentially saleable end-product(s), using representative mineral concentrate feed material, in preparation for a full-scale pilot plant to be run before completion of the Prefeasibility Study.
Darren L. Smith, M.Sc., P.Geol., Dahrouge Geological Consulting Ltd., a Qualified Person as defined by National Instrument 43-101, supervised the preparation of the technical information in this news release.
Eric Larochelle, Eng, and Alain Dorval, Eng., Manager- Process, Mining and Mineral Processing., of Roche Ltd, Consulting Group, Qualified Persons as defined by National Instrument 43-101, reviewed the technical information presented in this news release.
About Hazen Research Inc.
Hazen Research Inc., located in Colorado U.S.A, is an industry leader in metallurgical processing including rare earths. Their expertise extends across many commodities including base, precious, and rare metals, as well as pilot plant studies.
Over their 50+ year history, extensive experience in the metallurgy of rare earths has been developed via direct involvement on many rare earth projects with varying ore and gangue mineralogy. They are therefore, very well-known to industry, within and outside North America, as a leader in mineral beneficiation and hydrometallurgical processing of raw materials, including rare earth mineralized material.
Hazen is the primary metallurgical facility focused on defining the beneficiation and hydrometallurgical flowsheet for the Ashram Deposit.
About UVR-FIA GmbH
UVR-FIA GmbH, located in Freiberg Germany, is a mineral processing and research facility with roots dating back to 1954.
R. Gerhard Merker, a mineral processing engineer (Dipl.-Ing.) and leading expert in flotation of carbonate and fluorite-bearing bastnaesite ores, is consultant and manager of the Ashram Deposit’s test work at UVR. Mr. Merker has over 30 years’ experience in the raw material and recycling industry including several years studying the Dong Pao Rare Earth Deposit in Vietnam and other rare earth deposits.
UVR-FIA is working in tandem with Hazen Research to complete the flowsheet for the Ashram Depositwith a focus on fluorite separation from the rare earth minerals.
About the Ashram Rare Earth Element Deposit
The Ashram Rare Earth Element (REE) Deposit is a carbonatite within the Eldor Property, located in north-eastern Quebec. The Deposit has a measured and indicated resource of 29.3 million tonnes at 1.90% TREO and an inferred resource of 219.8 million tonnes at 1.88% TREO. The deposit boasts a well-balanced distribution with enrichment in the light, middle and heavy rare earth elements including all five of the most critical elements (neodymium, europium, dysprosium, terbium, and yttrium).
The REEs at Ashram occur in simple and well-understood mineralogy, being primarily in the mineral monazite and to a lesser extent in bastnaesite and xenotime. These minerals dominate the currently known commercial extraction processes for rare earths.
A Preliminary Economic Assessment, completed in May of 2012 by SGS-Geostat of Montreal (Blainville) (see news release May 24, 2012), outlines robust economics for the Ashram Deposit. The PEA is based on a 4,000 tonne per day open-pit operation with an initial 25-year mine life (300 years at economic cut-off if open-pit + underground development), a pre-tax and pre-finance Net Present Value (NPV) of $2.32 billion at a 10% discount rate, a pre-tax/pre-finance Internal Rate of Return (IRR) of 44%, and a pre-tax/pre-finance payback period of 2.25 years.
The company continues to advance the Ashram Deposit with metallurgical programs at both UVR-FIA and Hazen Research.
For more information, please visit the corporate website at http://www.commerceresources.com or contact Investor Relations at 1.866.484.2700 or firstname.lastname@example.org.
On Behalf of the Board of Directors
COMMERCE RESOURCES CORP.
President and Director
Neither 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.
This news release contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. Forward looking statements in this press release include but are not limited to reference to the outlineimg of next steps and potential end-products to be targeted; completion of a Prefeasibility Study; potential for downstream economics; estimates of costs to produce end products; intentions to initiate downstream processing studies; suggesting there may be no process need for costly lime neutralizing agent; references to reductions to capital and operating expenses; finding a greater number of potential saleable products; projecting increasing the value of primary mixed REO/REC concentrate; future evaluation of the five critical elements; references to end users and potential joint venture partners; the indication that significant room remains for increasing recovery and preparation for a full-scale pilot plant to be run before the completion of the Prefeasibility Study.
These forward-looking statements are based on the opinions and estimates of management and its consultants at the date the information is disseminated. They are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Risks that could change or prevent these statements from coming to fruition include changing costs for mining and processing and their impact on the cut off value established; increased capital costs; changing forecasts of mine production rates; the timing and content of upcoming work programs; geological interpretations based on drilling that may change with more detailed information; potential process methods and mineral recoveries assumption based on limited test work and by comparison to what are considered analogous deposits that with further test work may not be comparable; the availability of labour, equipment and markets for the products produced; market pricing for the products produced; and despite the current expected viability of the project, conditions changing such that the minerals on our property cannot be economically mined, or that the required permits to build and operate the envisaged mine can be obtained. The forward-looking information contained herein is given as of the date hereof and the Company assumes no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.