Name of the Project
Kvanefjeld multi-element project.

Location
Greenland.

Client
Greenland Minerals & Energy Limited (GMEL). Shenghe Resources has acquired a 12.5% interest in GMEL.

Project Description
The project comprises several large multi-element deposits rich in rare-earth elements, uranium and zinc. Collectively, these deposits represent one of the world’s largest identified mineral resources of rare earths and uranium.

The feasibility study schedule completed on the project in 2015 outlined a 37-year mine life, including three years of production ramp-up.

Kvanefjeld has a total resource base of 1.01-billion tonnes containing 593-million pounds of uranium and 11.14-million tonnes of total rare-earth oxides. Measured resources are estimated at 143-million tonnes.

The feasibility study completed on the project evaluated the development of a mine, a concentrator, a uranium and rare earths refinery, a rare earths separation plant for lanthanum and cerium, sulphuric and hydrochloric acid (HCI) plants, a power plant, new port facilities, an accommodation village, roads and logistics, as well as water supply and utilities, treating three-million tonnes of ore a year.

The operation will produce critical rare earths and by-products of uranium oxide, lanthanum and cerium, as well as zinc concentrate.

Mining operations will be opencast using standard drill-and-blast and truck-and-shovel methods.

This has been selected as the lowest operating-risk mining method in terms of cost and productivity, as well as mining zinc concentrate and fluorspar.

At the end of 37 years, the pit remains in ore and there is considerable potential to increase the mine life.

Two open satellite deposits also remain for development and present the opportunity to target specific elements – uranium, dysprosium and neodymium – based on market conditions.

Meanwhile, GMEL has made some material technical improvements to the project in the updated feasibility study released in April this year, which have enabled the company to update Kvanefjeld’s economic metrics.

The Kvanefjeld feasibility study update has demonstrated a robust, high-value rare earths and uranium project with extensive upside, owing to the substantial mineral resource inventory.

Conservative pricing assumptions demonstrate the viability of the project, even in a low-price environment.

GMEL has indicated that the project stands to be a stable, long-term, low-cost supplier of materials essential to clean energy generation and energy efficient technologies.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project’s net present value has increased from $1.4-billion, at an 8% discount rate in the 2015 feasibility study, to $1.59-billion at a 10% discount rate, in the updated feasibility study.

The internal rate of return has increased from 21.8% to 43.4%, while the payback period has decreased from six to five years.

Value
The 2015 feasibility study estimated a capital requirement for the project of $1.36-billion. This has decreased to $831.9-million in the updated feasibility study.

Duration
Not stated.

Latest Developments
Greenland Minerals has signed a memorandum of understanding (MoU) with shareholder Shenghe Resources Holding to commercialise the Kvanefjeld rare earths project.

The MoU establishes a strategic framework for the companies to enter future binding agreements covering the offtake of about 32 000 t/y of contained rare earths in chemical concentrate, or 34 000 t/y of contained rare earths in mineral concentrate.

Binding agreements are expected within three months from the mutual acceptance of the Kvanefjeld optimised flowsheet, which is expected in the first quarter of 2019.

The MoU also anables both parties to develop project finance strategies, which could include Shenghe taking an equity investment into the project as part of a joint venture agreement, as well as the development of project-specific rare-earth element separation capacity outside of China to directly supply the growing international demand centres.

The company is finalising an environmental-impact assessment for the Greenland authorities to prepare the way for public hearings, which is the next step in obtaining a mining licence.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
GMEL, tel +61 8 9382 or fax +61 8 9382 2788.