Project Info II
VANADIUM PROJECT
Pinnacle Resources announced that they
had concluded negotiations to acquire 100% ownership of Vanadium and
Magnetite Exploration and Development (Pty) Ltd. (V-MED) on June 7,
2000. V-MED, a South African corporation holds an exclusive 30-year
mineral lease on five contiguous farms near Potgietersrus, South Africa.
Significantly, these properties are adjacent to Pinnacle's platinum-palladium
properties.
The farms cover
17,188 acres within the Bushveld Complex, a region that accounts for
50 percent of the world's vanadium supply. They host a 6-meter thick
main layer magnetite, approximately 17 kilometers in strike length,
which is believed to be the largest underdeveloped resource of vanadium
in the world. Indicated resource of the main magnetite layer to a depth
of only 80 meters is estimated to be 100 million tones of magnetite
containing 1.67 million tones of vanadium pentoxide. Assays from diamond
core drilling show that the "run-of-mine ore" contains an average of
1.24% vanadium pentoxide and 11.88% titanium dioxide. The outcropping
and shallow magnetite layer constitutes a low cost open pit proposition.
Beneath the main
magnetite layer occurs a 20-meter thick horizon averaging 35% magnetite containing 1.71% vanadium pentoxide. Inferred resources to a depth of
200 meters are estimated to be 320 million tones of magnetite and 2.69
million tones of vanadium. Total resources on the properties to a depth
of 200 meters are therefore on the order of 570 million tones of magnetite
containing 6.87 million tones of vanadium pentoxide.
In March
1997 a techno-economic study to beneficiate the ore from the main magnetite
layer on V-MED's properties was conducted by the Council for Mineral
Technology (Mintek), world-renowned specialists in mineral and metallurgical
technology. The Department of Mining Engineering, University of Witwatersrand
also undertook mining studies. Ross Glanville & Associates of Vancouver,
Canada used the results of these investigations for an economic valuation
of the properties. They concluded that over a 20-year project life at
an annual production rate of 4120 tonnes of ferrovanadium (FeV) and
a price of $17/kg FeV, the operation showed a net present value (NPV)
of $70 million. In May 1998 with increased vanadium prices, Glanville
repeated the study using $22/kg FeV that returned an NPV of $111 million.
Recent research
and development into the beneficiation of vanadiferous titano-magnetite
ores indicates that it may now be economically feasible to extract not
only vanadium from the deposits, but also titanium and iron. V-MED is
investigating two breakthrough processes utilizing the expertise of
Bateman Minerals and Metals subsidiary Bateman Titaco (Pty) Ltd. and
Mintek.
