[Monte Muambe REE Project, Northwestern Mozambique. Source: Altona Rare Earths]
Altona Rare Earths (ANR ), an Africa-focused REE explorer, updated markets this morning on Q3 2022 performance of its Monte Muambe Rare Earths Mining Project in Mozambique.
Altona said operations were progressing on schedule at Monte Muambe with drilling on Target 1 and Target 4 continuing to define orebodies suitable for open-pit mining. Target 3 and Target 10 were still undergoing preliminary investigation.
Altona said exploration activities at the site have continued in accordance with its 2022 project plan and budget, with the next immediate milestones being the completion of a maiden mineral resource in Q1 2023, and a scoping study in Q2 2023.
Drilling highlights
Resource drilling progressed in Q3 with 14 reserve circulation (RC) holes totaling 1,372m drilled, mainly on Target 1. These holes were specifically intended to provide data for the upcoming maiden resource estimate. At 150m, two of the holes have allowed for testing of REE mineralisation at depth.
This work has allowed Altona to confirm the geometry of the REE body, having a strike length of at least 550m (open to the East and West), a width of up to 150m and extending to a depth of at least 120m below the surface (see map above).
Of the 14 aforementioned holes, 3 were drilled on Target 9 with inconclusive results despite some intercepts of up to 4.515% TREO. Altona therefore excluded Target 9 from its JORC estimate published in August, though it believes Target 9 to be a high potential site, with detailed soil sampling and ground geophysics carried out in Q3 to support additional drilling in the future.
While Altona has maintained a focus on Targets 1 and 4, it said surface exploration work continued on the other identified targets, with the objective of finding new blind targets likely to be present at Monte Muambe under a limited layer of overburden. To this effect, geological mapping, soil sampling, and ground geophysics continued on Targets 3, 9, and 10.
Christian Taylor-Wilkinson, CEO, commented:
"While the feasibility of a mining operation at Monte Muambe will ultimately rest on a large number of key parameters, including metallurgy, the results of the Exploration Target show a potential resource of a size and grade that could sustain a viable mining operation, with a geometry favorable to low strip ratio open pit mining. The project's characteristics compare favorably to Monte Muambe's peer group in Africa. Drawing on the mining experience of our operations team, we continue to integrate mining parameters in our exploration programme, right from the beginning, to ensure the delivery of an actually mineable project."
View from Vox
In less than a year, Monte Muambe has emerged as a promising REE project, almost certainly viable for open pit mining, and comparing favourably to its competitors in Africa. The August JORC exploration target set an estimated total tonnage of up to 56.6m tonnes at 1.65% Total Rare Earth Oxide (TREO). Anything above 1% TREO is considered economical, and 1.65% is well above average.
The estimate allowed Altona to confirm the potential size and grade of the project's primary carbonatite deposit, and validate its resource drilling plan. An additional 1600m of drilling on Targets 1 and 4 is planned before the end of the year.
Altona is on track to publish its maiden mineral resource estimate for Monte Muambe in Q1 2023 and a scoping study in Q2 2023.
Altona has also sent 1360 RC samples to labs in South Africa, and 20 ore samples from Targets 1 and 4 to Intertek in Perth, to gather more information on ore mineralogy and base data for metallurgical testing scheduled for November.
Altona's estimated REE resource at Monte Muambe matches that of companies with over 10x its market cap, so there is much potential for upside. Altona is also set to list on the LSE under the ticker REE, which should spur further investment. The listing should provide Altona with enough liquidity to develop its portfolio, facilitate future fundraising efforts, and give the company more negotiating power in acquiring further projects in Africa.
Rare Earth Elements (REEs) are key to the development of green technology, both in transportation and energy generation. A common use is permanent magnets used in EVs and wind turbines. Permanent magnet production has doubled between 2006 and 2021 to 125,000 tonnes currently, and expected to reach 315,000 tonnes by 2030. The REE market is expected to grow from $13.2 billion in 2019 to $19.8 billion in 2026.
With many developed countries actively phasing out internal combustion engines - the UK having set 2030 as a deadline for sales of petrol vehicles - prices of critical REEs such as Neodymium (Nd), Praseodymium (Pr), Dysprosium (Dy) and Terbium (Tb) have risen significantly in recent years and the trend is expected to continue. As demand has risen, many governments have begun stockpiling REEs, notably China and the US, further driving prices up.
Altona is investigating additional opportunities in Africa, specifically in Angola, Tanzania, Uganda, and Burundi. The company hopes to scale up as a producer and exporter of REEs. Its strategy is to acquire and develop overlooked REE sites, many of which were initially studied for other minerals, with REE discoveries neglected as demand was much less at the time of discovery.
Investors welcomed today's news, sending ANR shares up 3.2%.
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