Crossland and Pancontinental’s JV to tap the ‘very large tonnage potential for decades of rare earth production’
Crossland Strategic Metals (ASX: CUX) initially focused its efforts on uranium exploration, but their work has evolved through exploration success with joint-venture partner Pancontinental Uranium Corporation, so that rare earth elements (REEs), particularly at the Charley Creek Project in central Australia, now represent Crossland’s most important commodity thrust.
Their Charley Creek Alluvial REE Project is described as “Very large tonnage with potential for decades of REE production”. Indications are that the deposit has a high proportion of critical heavy rare earths (17% HREE by weight and 50% by value). Utilizing Standard heavy mineral sands techniques and gravity concentration, guides the premise of an affordable cost to production scenario. Total capital expenditure (CAPEX), including contingency is estimated at $156m, with a 2.5 year payback period. (It should be noted that this figure also includes infrastructure.)
Crossland Strategic Metals has derived its understanding of the Charley Creek Project’s potential via a combination of stream sediment sampling, auger and aircore drilling and bulk sampling. This work leads Management to conclude “that alluvial deposits may support a high throughput/low unit cost alluvial mining project that recovers the minerals monazite and xenotime, which together contain the complete suite of REE elements.”
By value, Critical REO (Dy, Tb, Y, Nd, Eu) dominate the Charley Creek deposit, with the highest value component being Dysprosium oxide.
The process of Aircore drilling – after having tested less than 5% of the total defined area of mineralized alluvial outwash – has defined Indicated and Inferred Resources of 387 million tonnes (114 m kg TREO) and 418 million tonnes (121 m kg TREO) respectively. Since the mineralization is found in alluvial deposits, there is virtually no overburden, thus lowering mining costs. Based upon the existing resource, at least a 20 year mine life, (LOM) can be expected.
Test work on alluvium samples demonstrates that REE concentrates can be produced at higher REE values and at lower cost than is typical from hard-rock REE deposits.
Crossland’s staged mining development plans involve initial dry mining with contractors feeding mobile washing plants, construction of mobile sites to enhance flexibility, evolving over time into a dredging operation. Once processed, the alluvial tailings will be returned to the excavation sites for site rehabilitation.
Get our daily investorintel update
Crossland’s joint venture partner, Pancontinental Uranium (55% Crossland; 45% Pancontinental), is a Canadian-based company focused on uranium discovery and development. The two entities share management and exploration teams; however, in order to explore for uranium outside of Australia, the two companies have formed a third Canadian company — Crosscontinental Uranium.
An excellent indicator about the seriousness of management’s belief in the likely success of their work can be gleaned by looking at their share holdings. In the case of Crossland, Directors and related parties – evidencing significant skin in the game – hold 12% of the share base. The top 20 shareholders hold a further 38%. Crossland Strategic Metals share structure (as of May, 2013) stood at 209m shares Fully Diluted.
Crossland’s share price movement coincided (also breaking out from an intermediate downtrend) with what in retrospect looks to have been a major low for the resource sector in general. From a technical analysis perspective, CUX may be putting in a double price bottom as this is being written.
Crossland Strategic Metals’ management – director team spans the breadth of activities that will need to be undertaken in this sector.
Bob Richardson, Chairman of the Board, has 40 years experience in mineral exploration management, geophysics and exploration technology. He has held the positions of Chief Geophysicist, Exploration Manager, and has been a geophysical contractor.
Geoff Eupene, Executive Director is a Darwin-based geologist, with breadth and depth of experience in the uranium space dating back to 1970. In 1976, he headed the team that discovered the Ranger 68 deposit beneath the Magela floodplains, eventually founding a consulting practice in Darwin.
Malcolm Smartt, Finance Director, is a Corporate Consultant to listed and unlisted public companies. He has fulfilled Directorial, Financial and Company Secretarial roles with a number of listed companies in the resource sector in Australia, South East Asia and Africa over the last 25 years.
Tony Chamberlain, Director has almost two decades of project management experience in strategic planning, project development and metallurgical flow sheet design associated with resource sector metals and the companies that produce them, including WMC, BHP and Clean TeQ Mining. As an added bonus for the Crossland team, he has also been responsible for the delivery of several feasibility studies and the implementation of capital projects.
Mr Sia, Hok Kiang, Non-Executive Director, is Managing Director of a Malaysian mining company. He has extensive experience in bulk alluvial mining in Malaysia, including the extraction of the rare earth minerals xenotime and monazite as by – products of tin mining. This experience should dovetail with work on Crossland’s Charley Creek Alluvial Project, which is also based on the extraction of monazite and xenotime, from alluvial material. He will be assisting Crossland with project development, with a primary goal of developing an early cash flow.
In a News Release on December 6, 2013, Crossland Strategic Metals, Ltd. announced it had “received Authorization under Section 36 of the NT Mining Management Act to conduct its proposed 2013 exploration program according to the Mine Management Plan (MMP) lodged with the Northern Territory Department of Mines and Energy. The MMP includes the 2013/14 feasibility drill program, which was announced to the ASX on 1 October 2013. This Authorisation now clears the way for Crossland to proceed with its feasibility drill program.”
During the early days of the Roman Empire, a visiting general proceeding to the capital with his troops beyond a certain point was said to have (literally) crossed the Rubicon, a small stream outside Rome. Since then, the phrase “crossing the Rubicon” has come to mean taking an action which permits only of forward movement that cannot be undone. With the acquisition of its feasibility drill program permit, it would appear that Crossland Strategic Metals, Ltd. is crossing a metaphorical “Rubicon” of its own.
Or as Julius Caesar would have remarked, “The die is cast.”
InvestorIntel is a trusted source of reliable information at the forefront of emerging markets that brings investment opportunities to discerning investors.