TORONTO, February 24, 2011 /PRNewswire/ --
Symbol: GEM
Listing: TSX Venture Exchange
Common Shares Outstanding: 132,463,74
Pele Mountain Resources Inc. (TSX Venture: GEM) ("Pele" or the
"Company") today announced the completion of a NI 43-101 Resource
Estimate ( the "Resource Estimate") which for the first time
includes both uranium oxide and rare earth oxides ("REO") at its
Eco Ridge Mine Uranium and Rare Earths Project in Elliot Lake, Ontario. Eco Ridge is owned
100-percent by First Canadian Uranium, a wholly owned subsidiary of
Pele. The Resource Estimate was prepared by Roscoe Postle
Associates ("RPA").
The Resource Estimate includes 51.9-million pounds of
"Indicated" total rare earth oxides ("TREO") plus an additional
96.3-million pounds of "Inferred" TREO. These resources are in
addition to 15.2-million pounds of Indicated uranium oxide ("U3O8")
plus an additional 31.4-million pounds of Inferred U3O8, which was
announced in Pele's press release dated January 24, 2011.
Pele President and CEO
Al Shefsky stated, "Our new REO
resource is exciting because it provides a potentially significant
source of by-product revenue at Eco Ridge and it places Pele on a
short list of emerging North American rare earth developers. Our
next priority at Eco Ridge is the completion of an updated NI
43-101 Preliminary Assessment ("PA"), which is expected in the
second quarter of 2011. The PA will feature a detailed economic
model based on combined revenues from U3O8 and REO and will include
significant mining, processing, and waste management design
enhancements achieved since our initial 2007 Scoping Study. We
believe Eco Ridge contains an important future source of U3O8 and
REO and we are determined to rapidly advance its development."
Recent extraordinary REO market developments, sparked by
China's reduction of export
quotas, have resulted in sharply higher prices, inciting a rush to
find and bring to production new sources outside of China. Eco Ridge has inherent competitive
advantages that may assist its development ahead of other projects,
such as:
- It is located within a proven mining camp with historic production
exceeding 300 million pounds of U3O8. Elliot Lake is the only mining
camp in Canada to achieve commercial production of REO.
- It contains the full range of naturally occurring REO, including the
highly valued "heavy" REO. The Elliot Lake camp was one of the most
important sources of heavy REO in North America.
- The project has the potential to be a primary uranium mine that would
produce REO as by-products, and would not be wholly dependent on the
volatile REO market.
- The mining and processing method to recover uranium at Eco Ridge will
also recover REO into the leach solutions, at no extra cost.
- It has well-understood geology and lies within a mining-friendly
jurisdiction. The project enjoys strong local support and is an ideal
location for a safe, secure, reliable long-term supply of uranium and
REO.
Roscoe Postle Associates reports the following Resource Estimate
at Eco Ridge:
Table 1 Mineral Resources - February 23, 2011
Pele Mountain Resources Inc. - Eco Ridge Mine Project
Classification Tonnes U3O8 U3O8 TREO5 TREO
('000s) (%) ('000 lbs) (%) ('000 lbs)
Indicated 14,312 0.048 15,182 0.164 51,859
Inferred 33,121 0.043 31,444 0.132 96,352
Notes:
1. CIM definitions were followed for Mineral Resources.
2. The Qualified Person for this Mineral Resource estimate is
Tudorel Ciuculescu, P.Geo.
3. Mineral Resources are estimated at a cut-off grade of 0.028%
U3O8.
4. Mineral Resources are estimated using an average long-term
uranium price of US$60 per lb, and a
C$:US$ exchange rate of 0.95:1.00.
5. Total Rare Earth Oxides include La2O3, CeO2, Pr6O11, Nd2O3,
Sm2O3, Eu2O3, Gd2O3, Tb4O7, Dy2O3, Ho2O3, Er2O3, Tm2O3, Yb2O3, and
Lu2O3. Y2O3 and Sc2O3 are also included in TREO.
6. The resource wireframe at Eco Ridge contains both Indicated
and Inferred U3O8 and TREO resources within the near surface
portion of the Main Conglomerate Bed.
7. The U3O8 resource estimate is based on a total of 237 drill
holes. These comprise 152 recent drill holes drilled by
Pele Mountain between 2006 and 2009,
and 85 historic drill holes drilled between 1954 and 1974.
8. The REO resource estimate is based on a total of 123 recent
drill holes.
Resource estimates for individual REO are available on Pele's
website at
http://www.pelemountain.com/pdfs/Table2_RareEarthOxides.pdf
The resource wireframe at Eco Ridge contains 14.3-million tonnes
of Indicated resources plus 33.1-million tonnes of Inferred
resources. The deposit extends to the north and east, beyond the
resource wireframe boundaries. Based on historical wide-spaced
drilling and extrapolation of the resource area, RPA estimates that
these extensions could contain an additional 30 to 50 million
tonnes grading from 0.03 to 0.05-percent U3O8 and 0.12 to
0.18-percent TREO as a "potential mineral deposit". Although there
is no historical REO data in this area, RPA expects that REO grades
would be similar to other portions of the deposit. The deposit also
remains open beyond the drilled areas with potential for
significant expansion. The potential quantity and grade of the
potential mineral deposit are conceptual in nature and there has
been insufficient exploration to define a mineral resource and it
is uncertain if further exploration will result in the targets
being delineated as a mineral resource.
The technical information relating to the NI 43-101 resource
estimate in this press release has been reviewed and approved by
Roscoe Postle Associates. The balance of this press release has
been reviewed and approved by Fergus
Kerr, P.Eng., Vice President of Uranium Operations for Pele
and a qualified person under NI 43-101.
About Pele
Pele Mountain Resources is focused on the sustainable
development of its Eco Ridge Mine Uranium and Rare Earths project,
located in Elliot Lake, Ontario.
Pele's expert team of technical personnel, advisors, and
consultants is working to optimize mining, processing, and waste
management techniques at Eco Ridge. With well-understood geology,
excellent regional infrastructure, and strong local support, Eco
Ridge provides an ideal location for a safe, secure, and reliable
long-term supply of uranium oxide and REO. Pele's shares are listed
on the TSX Venture Exchange under the symbol "GEM".
Neither the 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. Some of the statements contained in this
release are forward-looking statements, such as estimates and
statements that describe Pele's future plans, objectives or goals,
including words to the effect that Pele or management expects a
stated condition or result to occur. Since forward-looking
statements address future events and conditions, by their very
nature, they involve inherent risks and uncertainties. Actual
results in each case could differ materially from those currently
anticipated in such statements. The economic viability of the
43-101 mineral resource at Pele's Elliot Lake Project has not yet
been demonstrated by a preliminary feasibility study.
For further information:
Please contact Al Shefsky,
President, at +1(800)315-7353, or visit the Pele website at
http://www.pelemountain.com.
(GEM.)
