TORONTO, July 5, 2011 /PRNewswire/ --
Trading Symbol: TSX Venture : GEM
OTCQX : GOLDF
Shares Outstanding: 133,918,746
Pele Mountain Resources Inc. (TSXV: GEM) (OTCQX:
GOLDF) ("Pele" or the "Company") today
announced results of a NI 43-101 Preliminary Economic Assessment
(the "PEA") on its Eco Ridge Mine Rare Earths and Uranium
Project ("Eco Ridge" or the
"Project"). The PEA was prepared by Roscoe Postle Associates
("RPA") and demonstrates that Eco
Ridge has potential to become a profitable producer of rare
earth oxides ("REO") and uranium oxide
("U3O8").
The Project is located in Elliot Lake,
Ontario, the only Canadian mining camp to ever achieve
commercial REO production and an historically important source of
"Heavy" REO in North America. 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. With well-understood
geology, excellent regional infrastructure, and strong local
support, Eco Ridge is an ideal
location for a safe, secure, and reliable long-term supply of REO
and U3O8. Pele is focused on
transitioning Eco Ridge into the
feasibility and licensing stages as it advances the Project toward
development and production.
Highlights of the PEA include (all financial terms in US$):
- 9,400-tonne per day operation with life-of-mine production of
10.7-million pounds of Total REO and 24.9-million pounds of
U3O8 over a 14-year mine life.
- Cumulative operating cash flow of US$1.72-billion; Cumulative pre-tax cash flow of
US$1.31-billion.
- Positive NPV of $662-million (at
a 7.5% discount rate); IRR of 47-percent.
- Operating cash cost of $16 per
pound U3O8, net of REO credits.
- Start-up capital cost of $212-million; Sustaining capital cost of
$195-million.
- Life-of-mine production includes 430,000 pounds of dysprosium
oxide (Dy2O3), 1.28-million pounds of
neodymium oxide (Nd2O3), 2.08-million pounds
of yttrium oxide (Y2O3), and 67,000 pounds of
scandium oxide (Sc2O3).
- Two-thirds of REO revenue is from Heavy REO (including yttrium
and scandium oxides) many of which are forecast to be in
particularly short supply in the years ahead while demand continues
to rise sharply.
- Opportunities for improvement of project economics include
improved REO and U3O8 recoveries, and
increased resources and production rate.
To view the full press release, please click here:
http://www.pelemountain.com/pdfs/GEMPEA07052011.pdf
For further information:
Al Shefsky, President, at
+1-416-368-7224, or visit the Pele website
at http://www.pelemountain.com.
