Progressing To Rare Earth Oxide Production In Canada
Vital Metals Limited’s (ASX: VML) 100%- owned Canadian subsidiary Cheetah Resource Corp. has signed a definitive mining contract with local company Det’on Cho Nahanni Construction Ltd for work to commence at the North T Zone at its Nechalacho Project in Northwest Territories (NWT), Canada.
Managing Director, Geoff Atkins, said the North T Zone is the first deposit to be mined at Nechalacho, with Vital progressing to rare earth oxide production in CY2021.
“The signing of our mining contract in Yellowknife is an important step forward for Vital as we move toward production at Nechalacho, and we are pleased to be working with Det’on Cho Nahanni Construction Ltd, which is owned by local First Nations people,” Mr Atkins, said.
“We are developing Nechalacho using the most sustainable methods possible which includes the use of local labour so that we can support the communities surrounding our project.”
“Having finalised an offtake agreement with REEtec earlier this month, we are pleased to have executed this contract with Det’on Cho Nahanni Construction as it allows us to continue to progress towards production at Nechalacho, which is on track for the coming months.”
Signing of the mining contract follows the Memorandum of Understanding (MOU) both parties executed in January 2020, which established Det’on Cho Nahinni Construction as the preferred Mining Services Contractor. Det’on Cho Nahanni Construction is 51% owned by Det’on Cho Corporation, which is in turn owned by the Yellowknives Dene First Nation.
Scope of work under the mining contract includes mining, site clearing, preparation of retention pond, site roads, ROM pad, plus crushing and screening. Det’on Cho Nahanni Construction will mobilise to site at Nechalacho via ice road by the end of March.
“The Yellowknives Dene First Nation is pleased to be the first Indigenous group in Canada to be responsible for mineral extraction on their traditional territory. When Indigenous people conduct the mining operations, they are better able to control the process, resulting in better safeguarding of the environment. Meaningful participation in the extraction of critical minerals for the green economy provides employment and procurement benefits for our members and businesses. We look forward to increasing our participation as the Nechalacho Rare Earth Projects grows in the years to come.” said Yellowknives Dene First Nations Chief Ernest Betsina.
Under the contract with Det’on Cho Nahanni Construction, the North T Zone at Nechalacho will be mined as a small open pit with material transported to Vital’s ore sorter for sorting to create a product suitable for further processing off-site at Vital’s Rare Earth Extraction Plant in Saskatoon which will produce a mixed rare earth carbonate product for sale to separation facilities.
Det’on Cho Nahanni Construction will undertake mining and crushing during a single campaign between March and September 2021, under the control and direction of Cheetah Resources. Mined ore will be stockpiled for use in ore sorting operations which will be undertaken by Cheetah personnel during the summer periods of 2021 to 2023. It is anticipated that a second mining campaign will be required in 2024 to replenish stockpiles.
Vital executed a definitive agreement with Norwegian REE separation company REEtec AS earlier this month. Under the agreement, Vital will provide REEtec an annual volume of 1,000 tonnes of rare earth oxide (ex-cerium) ) over five years, with the option to increase this offtake volume up to 5000 tonnes REO (ex-cerium) per annum over 10 years (subject to a corresponding supply agreement).
Vital has commenced a 30-hole drilling program at Nechalacho that aims to define a preliminary mine plane for its planned Stage 2 production from the Tardiff resource (94.7Mt @ 1.46% TREO with over 1.3Mt contained rare earths). Vital’s drilling program will test three high-grade targets in the Tardiff deposit and evaluate potential expansion of the T Zone by targeting two additional zones, the South T and the S zones, which lie adjacent to the planned North T pit.