La Blache Property
NEVADO owns 439 claims covering an area of 242 km2 forming the titanium-vanadium-iron rich La Blache property (the "Property"), located some 150 km northwest of Baie-Comeau in the Upper North Shore region of Quebec.
With the help of geophysical surveys and prospection work, the Corporation has identified a total of 25 massive iron oxide lenses, including Farrell-Taylor, Hervieux West, Schmoo Lake, Hervieux East, Hervieux East Extension, Hervieux North Extension, Zorro-Leduc, Leduc-Farrell and E. Girard. The Farrell-Taylor lens has been modeled geophysically and drilled, and currently measures 1,500 metres by 550 metres by 115 metres. At present, there appears to be at least nine other lenses with similar size potential.
In 2010-2011, the Corporation realized over 22,000 metres of diamond drilling on the Property, mainly on the Farrell-Taylor occurrence, which enabled it to define the high-grade titanium-vanadium-iron resource shown below.
On July 9, 2012, the Corporation filed an NI 43-101 Technical Report dated May 14, 2012, on the La Blache titanium-vanadium-iron project with Canadian securities regulators, which includes Mineral Resource Estimates ("MRE") for its Farrell-Taylor titanium-vanadium-iron deposit ("Farrell-Taylor"). The Report was prepared by Maxime Dupéré, P.Geo., from SGS Canada Inc.-Geostat ("SGS-Geostat") of Blainville, Quebec.
Using a base case cut-off grade of 5.1% TiO2 Equivalent ("TiO2 Eq"), the MRE for Farrell-Taylor totals 101,700,000 tonnes grading 18% TiO2, 0.33% V2O5 and 59.7% Fe2O3 (41.76% FeT) in the Inferred category. The following table summarizes the MRE of Farrell-Taylor at other cut-off grades:
|MINERAL RESOURCE ESTIMATES – INFERRED CATEGORY|
(based on % TiO2 Eq1)
The Neomet Technologies Inc. ("Neomet") process recovery is estimated to be 90% for both titanium and vanadium, and 62% for iron. The estimates were based on an iron ore price of US $120/tonne as Fe2O3, a titanium ore price of US $2,500/tonne as TiO2, and a vanadium ore price of US $13,500/tonne as V2O5. Block model parameters are described hereinafter.
1 % TiO2 Eq denotes % TiO2 equivalent grade calculated as follows: % TiO2 Eq = % TiO2 + ((% Fe2O3 x 62% x $120/tonne) / (90% x $2,500/tonne) + (% V2O5 x 90% x $13,500/tonne) / 90% x $2,500/tonne).
2 SGS-Geostat utilized a US $115/tonne mining – Neomet-processing cost as the base case: US $50/tonne mining + US $65/tonne processing cost, including estimated G&A costs.
3 US $150/tonne mining – Neomet processing cost.
4 US $420/tonne mining – Neomet processing cost.
The MRE were performed in accordance with NI 43-101, Standards of Disclosure for Mineral Projects, and the "CIM Standards on Mineral Resources and Reserves - Definitions and Guidelines" developed by the CIM Standing Committee on Reserve Definitions and adopted by the CIM Council on December 11, 2005. Mineral resources, which are not mineral reserves, do not have demonstrated economic viability. The MRE may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant issues. The quantity and grade of the estimated Inferred resource reported herein are uncertain, and there has been insufficient exploration to categorize them as an Indicated or Measured resource. Further exploration may result (after validation and resource update) in the reclassification of the Inferred mineral resource as Indicated or Measured.
The mineralization consists mostly of magnetite (iron oxide) and ilmenite (iron titanium oxide), with lesser amounts of iron-magnesium aluminum-silicate minerals, all part of a series of sub-vertical, inclined and sub-horizontal dykes, sills, veins, stockworks and disseminations emplaced along multi-kilometric circular and elliptical configurations within the 35 km by 12 km La Blache anorthositic complex, such as the 45 km La Blache ring of titanium-vanadium-iron.
The geological interpretations on section were linked together into a 3D mesh by the Corporation. SGS-Geostat reviewed and validated the model and added some minor modifications. The 3D mesh covers over 1,150 metres on the east-northeast direction with an average width of 470 metres. The mineralization starts at 200 metres wide on the west-southwest and widens at depth to approximately 715 metres to the east-northeast. It dips 20 degrees towards the east-northeast, and has a thickness of 50 metres on average, but ranging from 15 metres to as high as 85 metres in the deeper portions.
The database used for the resources estimation used a total of 45 diamond drill holes totalling 16,577 metres (2010-2011 drill programs) and a total of 7,483 assays were considered in the validated database.
The assay method used was XRF for iron and TiO2 and ICP AES with special four-acid digestion for vanadium in Val-d’Or, at ALS Minerals of Vancouver.
Based on discussions among SGS-Geostat, the consultants and the Corporation, a mining-processing cost of US $115 per tonne was used, which includes an estimated US $50 per tonne for open pit mining and an estimated US $65 per tonne for Neomet (hydrometallurgical) processing (including G&A). Considering the local resource potential and proximity to the nearby town of Baie-Comeau, as well as the relatively large distance to smelters and larger mining communities, SGS-Geostat considers the estimated mining and hydrometallurgical processing costs to be adequate and conservative.
The overall % TiO2 Eq grade is defined as a temporary grade, which, when used with the TiO2 recovery and TiO2 price, gives the correct net smelter return royalty for a tonne of ore. This equivalent grade combined with TiO2 recovery and TiO2 price can be used to calculate a marginal-processing cut-off grade for resource modeling purposes. SGS-Geostat set the cut-off grade at 5.1% TiO2 Eq. A sensitivity table was also prepared for several benches. All of the Inferred mineral resource occurs between 0 and 600 metres vertical depth. A cut-off grade of 5.1% TiO2 Eq was used for this table. No pit optimization (Whittle) was done for the mineralization.
1 Tonnage numbers are rounded to the nearest 10,000 as per National Instrument 43-101 Standards and Policies.
La Blache Metallurgy
Preliminary metallurgical testing of the Corporation’s oxide mineralization by Neomet Technologies Inc. ("Neomet") has indicated >90% iron recovery and >95% vanadium recovery from the oxide mineralization into a final high-purity product. Neomet has demonstrated that titanium could be 100% recovered from the leach solution into a TiO2 (titanium dioxide) product suitable for further processing to pigment grade TiO2. Ammonium metavanadate, the precursor to V2O5 (vanadium pentoxide), was recovered from the leach solution at a purity of 99.9%.
On February 9, 2012, the Corporation announced the results of metallurgical test work on Neomet’s Stage 2 mini-plant campaign from the Corporation’s oxide mineralization. These results were obtained from Neomet’s final report dated January 16, 2012, which are summarized below:
- The mini-plant circuit was conceived and set up as a continuous operation process;
- High extractions of greater than 90% titanium and vanadium were achieved;
- Titanium was easily and effectively precipitated directly from the leach liquor as TiO2 of purity greater than 98%;
- TiO2 was easily upgraded to a product of greater than 99.9% purity in a second step, offering the option of marketing two product grades;
- High purity vanadium (greater than 99.9% pure as ammonium metavanadate) was also recovered;
- The dissolution of the minor elements present in oxides mineralization (aluminum, magnesium, calcium and manganese) are not a cause for concern in the Neomet process and may be opportunities for value-added by-products.
Since filing a NI 43-101 technical report with respect to the La Blache property in July 2012, the Corporation has worked steadily to increase the project's long-term value by focusing the bulk of its efforts on two strategic priorities: 1) seeking out and assessing competitive metallurgical processes for the low cost production of higher-quality titanium based products, and 2) identifying strategic partners to help with optimal project development and operation. The Corporation wishes to underscore that the La Blache project remains without question the Corporation's flagship project.