exploring the karrat ree deposit in greenland
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RARE EARTHS, SPECIALITY& STRATEGIC METALSINVESTMENT SUMMIT
IRONMONGERS’ HALL, CITY OF LONDON ● THURSDAY, 17 MAR 2011www.ObjectiveCapitalConferences.com
Exploring the Karrat REE deposit in GreenlandHugh Mackay – Chairman, Avannaa Resources
Avannaa Resources
Exploring the Karrat REE deposit in Greenland
Objective Capital Rare Earths, Speciality & Strategic Metals Investment Summit
London, 17 March 2011
www.avannaa.com
Avannaa key facts
1. Founded in UK in 2006. Not listed. Focussed on Greenland exploration, where founders have worked since 1982
2. Experts at grassroots mineral exploration, experts on the geology of Greenland
3. Objective is to find giant deposits of gold, base metals and diamonds.
4. Focus on competitive edge in grassroots exploration and bring in development partners to take mines into production
Why Greenland?
• Excellent geology – the same geology in Australia, Canada and southern Africa hosts world class mineral deposits.
• Under-explored, high potential for significant discoveries
• Greenland government is pro-mining and single government agency acts as administrative partner
• No royalties, favourable deductions on capital, no ring-fencing
• 30 % corporate tax
• Simple logistics, extensive access to deep tidal water, ocean moderated climate
• Modern society with educated, problem-solving workforce
Management TeamDr. Nicholas Rose: CEO
Ph.D. Geology, Stanford University, 1989Active in Greenland since 1982 on a variety of research and mineral exploration projects, and has a total of 18 field seasons in Greenland. Research fellow at Lawrence Livermore National Laboratory (California) and University of Copenhagen. Managed projects for several mining exploration companies working in Greenland during the 1990’s including Inco, Quadrant Resources and Diamet and has worked as a geologist in exploration projects in Greenland since 1986. Excellent network in the Greenland geological and mining community.
Dr. Stefan Bernstein: Exploration Director Ph.D. Geology, University of Copenhagen, 1994Senior scientist in Danish geological community, including five years at the Geological Survey of Denmark and Greenland (GEUS). Resident in Greenland 2 years as leader of Denmark’s Arctic research station. 24 research and exploration seasons in all parts of Greenland including work with Platinova, Quadrant, NunaOil, RTZ, Strathcona, Corona and Teck. Intimate knowledge and direct involvement with most major deposit finds in Greenland within the last 15 years. Author of >30 scientific papers.
Hugh Mackay: ChairmanB.Sc. (Hons) Geology, University of Edinburgh, 1982; Sloan M.Sc., London Business School, 2001. International management experience in disciplined corporate environments in oil exploration with BP and Enterprise Oil. Management team in 3 start up companies culminating in $50 million trade sale of The Peak Group to AGR ASA. Special experience of exploration portfolio management and business development. Hands on experience of company start-up, managing growth, trade sale and mergers. Several expeditions to Greenland since 1982.
The Avannaa management team are also the founders of the company
LicencesLicence number Region km2
Award date Targets
2007/52 Disko 8 2007 Diamonds
2008/27 Saqqaq/Itilliarsuk 140 2008 Au, Fe
2008/33 Eqi 70 2008 Au
2010/05 Karrat REE 122 2010 REE
2010/20 Flammefjeld 14 2010 Mo, Au
2010/31 Nuussuaq 24 2010 Zn
2010/32 IC Christensen Land 405 2010 Cu
2011/30 ICC extension 4096 2011 Cu
2011/31 Kangerluarsuk 112 2011 SEDEX Pb-Zn
2011/40 Central East Greenland 1072 2011 Cu
Total 6063
Avannaa is a leading Greenland explorer
02468
10121416
Number of licences
01000200030004000500060007000
km2 under licence
Flammefjeld Mo/Au
Karrat REE
Projects
Qeqertaa diamond
SEDEX lead-zinc
Central East Greenland copper
Itilliarsuk gold, iron
IC Christensen Land copper
• Large tonnage• Open pit• HREO enriched• Next to coast
Karrat REE
Karrat REE location
HistoryNew rare earth element deposit, discovered by Avannaa2007: discovery during regional prospecting2008: verification2009: bulk sampling, prospecting - confirmed and enlarged deposit – applied for more ground2010: drill 1740m, bulk & channel sampling, prospecting
Licence data2010/05, 122 km2
2007/08, 84 km2
Karrat REE two locations
Umiamako Nuna UMIA
NiaqornakavsakNIAQ
10 km
NIAQ geology
• Host rock is Paleoproterozoic metasediments and metavolcanics of the Karrat Group
• REE mineralization is a lithologically distinct horizon of banded carbonates in an amphibolite unit
NIAQ
Stratigraphy
NIAQ looking southNIAQ 6,7,8NIAQ 1,2NIAQ 3,4,5
NIAQ Bulk
East
West
NIAQ cross section 3,4,5
NIAQ bulk sample siteUMIA
NIAQ
NIAQ
UMIA
NIAQ dimensions
• Tabular body hosting the REE• 1.5 km long, striking east west• True thickness pinches and swells from 10.3 to
32.5 m, structurally controlled• Dips south at 32o
• 56 m asl highest outcrop• 165 m bsl deepest drill penetration• 26 million tonnes is reasonable resource target• Open in two dimensions
NIAQ REE
• REE mainly hosted by bastnaesite, monazite, allanite and other REE silicates.
• TREO+ Y 1.36 wt% average in bulk sample. Up to 2.45% in core.
• HREO+Y 13.06% average in bulk sample. Up to 30% in core.
Calcium carbonate banded horizon
Magnetite
Bastnasite Calcite25 µm
BSE Electron Microprobe – Stanford University
Major Mineralogy• Calcium carbonate ~80-90%• Grunerite (Fe-Mg amphibole), Magnetite, Ilmenite, Fluorite, Anandite (Ba-S mica)Primary REE mineral• Bastnasite
Black layered carbonate
SEM BSE image – Stanford University
Major Mineralogy• Anandite (Ba-S mica) ~50-80%• Magnetite, Ilmenite, Calcite, Apatite, EdenitePrimary REE minerals• Bastnasite, Monazite, Allanite
CI Chondrite data after Anders and Greeves (1989)
La
Ce
Pr
Nd
Sm
EuGd
Tb
Dy
HoEr
TmYb
Lu
100
1000
10000
55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72
Sam
ple/
Ch
ondr
ite
Atomic Number
NIAQ Chondrite normalized core data
Working Theory
• Source fluid is from a ferrocarbonatite. • We believe that the mineralized horizon is not a
carbonatite based primarily on the overall whole rock chemistry.
• SiO2 content of the horizon varies between 15-25%, in a carbonatite we would expect to see values below 5%.
• CaO content varies between 18-20%, in a carbonatite we would expect to see values >30%.
Karrat vs. Bayan Obo
1
10
100
1000
10000
100000
La Ce Pr Nd Sm Eu Gd Tb Dy Ho Er Tm Yb Lu
Karrat
Ffe - Primary Ore
MFe
AeFe
RiFe
DFe
NIAQ 1.36 wt% TREO+Y, 13.06% HREO+Y
Element ppm*
Me2O3
factorRE2O3
ppm RE2O3 wt%RE203 in %
kg RE2O3
tonne
La 2245 1.173 2633.4 0.263% 19.3% 2.63Ce 5036.9 1.171 5898.2 0.590% 43.3% 5.90Pr 470.1 1.17 550.0 0.055% 4.0% 0.55Nd 2003.6 1.166 2336.2 0.234% 17.2% 2.34Sm 358.2 1.16 415.5 0.042% 3.1% 0.42Eu 106 1.158 122.7 0.012% 0.9% 0.12Gd 270.1 1.153 311.4 0.031% 2.3% 0.31Tb 38.8 1.151 44.7 0.004% 0.3% 0.04Dy 180.8 1.148 207.6 0.021% 1.5% 0.21Ho 28.2 1.146 32.3 0.003% 0.2% 0.03Er 69.1 1.143 79.0 0.008% 0.6% 0.08Tm 7.9 1.142 9.0 0.001% 0.1% 0.01Yb 42.6 1.139 48.5 0.005% 0.4% 0.05Lu 5.5 1.137 6.3 0.001% 0.0% 0.01Y 721.5 1.269 915.6 0.092% 6.7% 0.92Total 11584.3 13610.4 1.361% 100.0% 13.61*Analyses from average bulk sample nos 2523 - 2530Bold = critical supply issues in medium term
NIAQ key metrics
26 million tonnesAverage bulk sample
2014 FOB Feb 2011 FOB$ kg RE2O3 product 32$ 123$ $ tonne ore 432$ 1,669$ In ground value (billions) 11$ 43$
NIAQ 2014 FOB prices26 million tonnes ore
Element ppm*
Me2O3
factorRE2O3
ppm RE2O3 wt%RE203 in %
kg RE2O3
tonne2014 price kg RE203
RE2O3
product NIAQ $
kg NIAQ $
tonne ore
NIAQ in ground value $ billion
La 2245 1.173 2633.4 0.263% 19.3% 2.63 4.06$ 0.79$ 10.69$ 0.28$ Ce 5036.9 1.171 5898.2 0.590% 43.3% 5.90 2.08$ 0.90$ 12.27$ 0.32$ Pr 470.1 1.17 550.0 0.055% 4.0% 0.55 43.87$ 1.77$ 24.13$ 0.63$ Nd 2003.6 1.166 2336.2 0.234% 17.2% 2.34 46.06$ 7.91$ 107.61$ 2.80$ Sm 358.2 1.16 415.5 0.042% 3.1% 0.42 5.58$ 0.17$ 2.32$ 0.06$ Eu 106 1.158 122.7 0.012% 0.9% 0.12 1,086.10$ 9.80$ 133.32$ 3.47$ Gd 270.1 1.153 311.4 0.031% 2.3% 0.31 13.70$ 0.31$ 4.27$ 0.11$ Tb 38.8 1.151 44.7 0.004% 0.3% 0.04 1,166.09$ 3.83$ 52.08$ 1.35$ Dy 180.8 1.148 207.6 0.021% 1.5% 0.21 254.59$ 3.88$ 52.84$ 1.37$ Ho 28.2 1.146 32.3 0.003% 0.2% 0.03 66.35$ 0.16$ 2.14$ 0.06$ Er 69.1 1.143 79.0 0.008% 0.6% 0.08 48.92$ 0.28$ 3.86$ 0.10$ Tm 7.9 1.142 9.0 0.001% 0.1% 0.01 90.00$ 0.06$ 0.81$ 0.02$ Yb 42.6 1.139 48.5 0.005% 0.4% 0.05 25.00$ 0.09$ 1.21$ 0.03$ Lu 5.5 1.137 6.3 0.001% 0.0% 0.01 522.83$ 0.24$ 3.27$ 0.09$ Y 721.5 1.269 915.6 0.092% 6.7% 0.92 23.22$ 1.56$ 21.26$ 0.55$ Total 11584.3 13610.4 1.361% 100.0% 13.61 31.75$ 432.08$ 11.23$ *Analyses from average bulk sample nos 2523 - 2530Bold = critical supply issues in medium term
2014 FOB prices
NIAQ Feb 2011 FOB prices26 million tonnes ore
Element ppm*
Me2O3
factorRE2O3
ppm RE2O3 wt%RE203 in %
kg RE2O3
tonne
2011 price kg RE203
RE2O3
product NIAQ $ kg
NIAQ $ tonne ore
NIAQ in ground value S billion
La 2245 1.173 2633.4 0.263% 19.3% 2.63 92.10$ 17.82$ 242.53$ 6.31$ Ce 5036.9 1.171 5898.2 0.590% 43.3% 5.90 95.10$ 41.21$ 560.92$ 14.58$ Pr 470.1 1.17 550.0 0.055% 4.0% 0.55 140.50$ 5.68$ 77.28$ 2.01$ Nd 2003.6 1.166 2336.2 0.234% 17.2% 2.34 156.00$ 26.78$ 364.45$ 9.48$ Sm 358.2 1.16 415.5 0.042% 3.1% 0.42 95.10$ 2.90$ 39.52$ 1.03$ Eu 106 1.158 122.7 0.012% 0.9% 0.12 800.00$ 7.21$ 98.20$ 2.55$ Gd 270.1 1.153 311.4 0.031% 2.3% 0.31 58.00$ 1.33$ 18.06$ 0.47$ Tb 38.8 1.151 44.7 0.004% 0.3% 0.04 800.00$ 2.62$ 35.73$ 0.93$ Dy 180.8 1.148 207.6 0.021% 1.5% 0.21 460.00$ 7.01$ 95.48$ 2.48$ Ho 28.2 1.146 32.3 0.003% 0.2% 0.03 66.35$ 0.16$ 2.14$ 0.06$ Er 69.1 1.143 79.0 0.008% 0.6% 0.08 340.00$ 1.97$ 26.85$ 0.70$ Tm 7.9 1.142 9.0 0.001% 0.1% 0.01 90.00$ 0.06$ 0.81$ 0.02$ Yb 42.6 1.139 48.5 0.005% 0.4% 0.05 33.40$ 0.12$ 1.62$ 0.04$ Lu 5.5 1.137 6.3 0.001% 0.0% 0.01 365.00$ 0.17$ 2.28$ 0.06$ Y 721.5 1.269 915.6 0.092% 6.7% 0.92 113.00$ 7.60$ 103.46$ 2.69$ Total 11584.3 13610.4 1.361% 100.0% 13.61 122.65$ 1,669.33$ 43.40$ *Analyses from average bulk sample nos 2523 - 2530Bold = critical supply issues in medium term
February 2011 FOB prices
NIAQ comparison
All values based on 2014 FOB, company data from websites and SEDAR as at 20 Nov 2010. Mkt Cap FT.com 13 Dec 2010.
2800
343
2500
352 268 211 145365
46216 107
1
10
100
1000
10000
$-$10.00 $20.00 $30.00 $40.00 $50.00 $60.00 $70.00 $80.00 M
kt cap S million
Skg
REO
$kg REO vs Mkt Cap
$ kg REO Mkt Cap $
Umiamako Nuna Drill site
Potential REE mineralisation observed in field at several locations. 200m section tested by drilling in two holes. Possible extraction by simple quarry.
Looking north toward summitLooking south from summit
Support Services
• ALS Chemex• AMEC• Moose Mountain• P-MET• PFU-APS• SGS Lakefield• Stanford University• Wardrop
Bulk sample
Comminution and characterisation
Non mags
Mags
Roasting Magneticseparation
Water/Mildacid leaching
Acid leaching
Flotation
Calcine
Conc.
Acid leaching
Lixivium
Lixivium
Lixivium
Ion exchange/ Precipiation
Ion exchange/ Precipiation
Ion exchange/ Precipiation
PreferredPossible
Less possible
Metallurgy NIAQ
Next steps
• Current activity– Commercial modelling– Metallurgical testing– Scoping level
assessment
• Future activityNI 43-101 compliant:– Indicated resource– Preliminary Economic
Assessment
Contact
Avannaa Resources LimitedDronningens Tværgade 48 st.tv
1302 København KDenmark
e-mail enquiries to:hgm@avannaa.com
telephone: +44 7771 660 539
www.avannaa.com
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