TORONTO, Jul. 5, 2011 (PR Newswire Europe) -- v>
/PRNewswire/ --
Trading Symbol: TSX Venture : GEM OTCQX : GOLDF Shares Outstanding: 133,918,746
Pele Mountain Resources Inc. (OTCQX: GOLDF) ("Pele" or the "Company") today announced results of a NI 43-101 Preliminary Economic Assessment (the "PEA") on its Eco Ridge Mine Rare Earths and Uranium Project ("Eco Ridge" or the "Project"). The PEA was prepared by Roscoe Postle Associates ("RPA") and demonstrates that Eco Ridge has potential to become a profitable producer of rare earth oxides ("REO") and uranium oxide ("U3O8").
The Project is located in Elliot Lake, Ontario, the only Canadian mining camp to ever achieve commercial REO production and an historically important source of "Heavy" REO in North America. Recent extraordinary REO market developments, sparked by China's reduction of export quotas, have resulted in sharply higher prices, inciting a rush to find and bring to production new sources outside of China. With well-understood geology, excellent regional infrastructure, and strong local support, Eco Ridge is an ideal location for a safe, secure, and reliable long-term supply of REO and U3O8. Pele is focused on transitioning Eco Ridge into the feasibility and licensing stages as it advances the Project toward development and production.
Highlights of the PEA include (all financial terms in US$):
- 9,400-tonne per day operation with life-of-mine production of 10.7-million pounds of Total REO and 24.9-million pounds of U3O8 over a 14-year mine life. - Cumulative operating cash flow of US$1.72-billion; Cumulative pre-tax cash flow of US$1.31-billion. - Positive NPV of $662-million (at a 7.5% discount rate); IRR of 47-percent. - Operating cash cost of $16 per pound U3O8, net of REO credits. - Start-up capital cost of $212-million; Sustaining capital cost of $195-million. - Life-of-mine production includes 430,000 pounds of dysprosium oxide (Dy2O3), 1.28-million pounds of neodymium oxide (Nd2O3), 2.08-million pounds of yttrium oxide (Y2O3), and 67,000 pounds of scandium oxide (Sc2O3). - Two-thirds of REO revenue is from Heavy REO (including yttrium and scandium oxides) many of which are forecast to be in particularly short supply in the years ahead while demand continues to rise sharply. - Opportunities for improvement of project economics include improved REO and U3O8 recoveries, and increased resources and production rate.
To view the full press release, please click here: https://www.pelemountain.com/pdfs/GEMPEA07052011.pdf
For further information:
Al Shefsky, President, at +1-416-368-7224, or visit the Pele website at https://www.pelemountain.com.
Pele Mountain Resources Inc.