Ecometals Clarifies Serra do Navio Manganese Resource Estimates and the Shipment and Sale of Manganese Stockpiles From Porto Santana, Brazil
July 17, 2009 at 13:11 PM EDT
TORONTO, ONTARIO--(Marketwire - July 17, 2009) - Ecometals Limited (TSX VENTURE:EC)(BERLIN:GDQ)(FRANKFURT:GDQ) -
As a result of a review by the British Columbia Securities Commission, Ecometals (the Company) is issuing the following news release to clarify its disclosure in a previous news release issued 29 June 2009 and in its Management Discussion & Analysis for the 9 month period ended December 31, 2008.
Serra do Navio Mine Site
The Serra do Navio manganese mine was operated by Industria e Comercio de Minieros SA (ICOMI) from 1957 until closure in 1997, producing a reported 34Mt of commercialised products. Ecometals owns 66.67% and operates a joint venture company, which is the owner of the mineralised material, with ICOMI (now Alto Tocantins Mineracao Ltda).
On closure of the mine, Roberto Costa Engenharia Ltda completed a report which covers the geology, historical mining and processing methods, production, metallurgy, mineral economics, and an estimate of the remaining in situ mineralized material. Ing. Roberto Costa is a registered mining and metallurgical engineer in Brazil under CREA MG-4381.
As the Costa resource report was completed in 1997, the resource is "Historical" under NI43-101.
Costa reports the remaining in situ (in ground) resources as 1.2Mt oxide @ 38.43% Mn and 4.4Mt carbonate type @ 30.61% Mn mineralised material. The historical mineral resource was not classified as measured, indicated or inferred, and the Company considers the mineralized material is comparable to a potential mineral deposit for which there has been insufficient exploration to delineate a mineral resource.
Stockpiled manganese mineralised material at Serra do Navio was surveyed by Topgeo Servicos Ltda as 1,615,759 cubic metres in 34 stockpiles. Using a density of 2.5t/m3 for floated mineralized material from the Costa report, this amounts to a total of approximately 4Mt of stockpiled manganese mineralized material. However, the stockpiles are comprised of material which has been processed to different sizes and grades, and contain both oxide and carbonate type mineralization. A more conservative density of 2.02t/m3 taken as the lowest density measured by SGS do Brazil Ltda on similar stockpiled material at Porto Santana is assumed by the Company. This results in an estimated 3.3Mt of stockpiled manganese mineralised material at Serra do Navio.
Grade ranges from grab samples taken from larger stockpiles range from 28.3% to 45.3% Mn, but there has been insufficient work to determine the inherent inhomogeneity of the material and the samples are not considered representative of the total volume of the stockpiles. The Company considers the stockpiles of 3.3 to 4Mt with potential grades in the range 28 to 45% Mn are comparable to potential mineral deposits for which there has been insufficient sampling and test work to determine the average grade or delineate a mineral resource.
Neither the in situ resource nor the stockpiled mineralized material at Serra do Navio are considered current Resources by the Company according to CIMM/JORC definitions.
Previous references to the term "ore" in Company disclosures referring to some of the above material were inappropriate because the Company does not have a current mineral resource, pre-feasibility or feasibility study to demonstrate economic viability.
On 29 June 2009, the Company disclosed "...project design work is well advanced", and referred to discussions with a development bank for project funding. Metallurgical recovery tests on beneficiation of the manganese stockpiles at Serra do Navio are being conducted by Bateman Engineering NV and in-house conceptual process design is ongoing, to enable a management decision to be made on advancing the project to commercial production. Preliminary discussions with Banco Amazonia SA in Brazil have taken place, with the objective of financing up to US$10M for the capital and development costs for construction of a beneficiation plant to process the stockpiles at Serra do Navio.
Porto Santana Stockpiles
Stockpiled manganese mineralized material at Porto Santana was mined from Serra do Navio but was not shipped previously by ICOMI due to prevailing economic conditions. SGS do Brazil Ltda surveyed the volume and density of nine stockpiles at the Anglo Ferrous Brazil (AFB) port resulting in a total of 57,935.4t. Grade estimates by SGS ranged from 29.46 to 48.05% Mn.
The stockpiled mineralised material was transhipped by road from the AFB port to the public port operated by Compania Docas do Santana (CDSA). Material from the nine stockpiles was blended into two stockpiles of high and low grade. Topgeo Servicos Ltda re-surveyed the two blended stockpiles and concluded 13,079.78m3 for stockpile A (low grade) and 6,031.79m3 for stockpile B (high grade), with 2,715.31m3 remaining at the AFB port. Not all the material was shipped to the CDSA port as the maximum size vessel limited by the depth of the Amazon River delta is 45,000t.
Using the density measurements estimated by SGS, the total material at the CDSA port was 42,394t with 6,023t remaining at the AFB port. A discrepancy of 6.5% between the original stockpile survey at the AFB port and the survey after transhipment is attributed to loss of material on the laydown area and error inherent in the volumetric surveys.
A sales contract with an undisclosed buyer was made for 35,532t of mineralized material from the stockpiles at CDSA. The sales contract required a minimum of 43% Mn of high grade material (all of stockpile B) and the remainder of minimum 35% Mn from stockpile A (low grade material) to fill the hold of the ship.
Continuous sampling according to ISO Standard 4296/1:1984 during ship loading was conducted by Inspectorate do Brasil Inspecoes Ltda. Results of draft loading and analysis measured 12,088t of 41.62% Mn (high grade material) and 23,444t of 35.96% Mn (low grade material) loaded on cargo ship MV West Lake.
There remains an estimated 12,885t (6023t at AFB port and 6,862t at CDSA port) of low grade stockpiled manganese mineralized material available at Porto Santana. This material is potentially saleable, and the Company is actively pursuing buyers. This remainder will be supplemented by additional material from Serra do Navio stockpiles to fulfil the 65,000t purchased by Ecometals separately from the JV agreement with Alto Tocantins.
Manganese is not traded on international commodity markets, and prices are based on negotiation of individual contracts. For this shipment, the total gross revenue to the Company based on a negotiated price was C$1.1M.
SR McMullan, P.Geo, Vice President of Exploration for Ecometals Limited, is a qualified person according to National Instrument 43-101 definition and has prepared the technical information included in this press release.
Ecometals Limited is a Canadian-listed mineral exploration and development company focused on the mineral resources in Latin America. Ecometals also has significant manganese and iron projects in Brazil at grass roots and development planning stages.
Safe Harbor Statement: Statements contained in this release that are not historical facts are forward-looking statements which involve risk and uncertainties, which could cause actual results to differ materially from those expressed in forward-looking statements.
These include risks relating to changes in economic or environmental conditions and the company's ability to execute its business model and strategic plans. The company relies on litigation protection for forward-looking statements."Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."