Rare earths exploration company Namibia Rare Earths (NRE) announced on December 1, 2014, that Namibia’s Ministry of Mines had renewed its Lofdal rare earths project’s exclusive prospecting licence for a further two years.

The Lofdal rare earths project is a 200 km2 carbonatite complex with high heavy rare earths enrichment.

NRE recently filed a National Instrument 43-101 technical report titled ‘Preliminary Economic Assessment (PEA) on the Lofdal Rare Earths Project Namibia’, which concluded that the Lofdal project currently has the potential to produce an average of 1 500 t/y of separated rare-earth oxides.

This would generate an after-tax cumulative cash flow of $259-million with a 10% base assumption net present value of $148-million and an internal rate of return of 42%.

The PEA also indicates that there is considerable potential to expand the current mineral resource and recommends that additional drilling be carried out to provide for an extended mine life in conjunction with a six-month prefeasibility study programme.

Initial capital layout costs are calculated in the PEA to be $93-million and the total capital cost is $160-million, with the life of the mine at about seven years.

NRE asserts that the PEA should not be considered to be a prefeasibility or feasibility study, as the economics and technical viability of the project have not been demonstrated at this time.

“The PEA is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied that would enable them to be categorised as mineral reserves. Further, there is no certainty that the PEA will be realised,” the company says.

Meanwhile, NRE also announced in December that its board had granted a total of 2.48-million incentive stock options to an aggregate of 18 directors, officers and employees of, and consultants to, the company. The options are exercisable for five years at an exercise price of $0.20 and represent the first grant of options since February 2012.