Toronto, ON - Avalon Rare Metals Inc. (TSX and NYSE Amex: AVL) ("Avalon" or the
"Company")announces that it is continuing to make steady
progress towards defining the metallurgical process flowsheets for the
Nechalacho heavy rare earths ore. Results are positive but progress has
been slower than originally anticipated. This could result in a minor
delay in the completion of the bankable feasibility study, but the
overall schedule to production remains unaffected at this time.
Recent metallurgical testwork has been focused on the flotation
process for concentrating the rare earth bearing minerals. A 3.7 tonne
continuous pilot scale concentrate production run was executed at SGS
Minerals, Lakefield, Ontario ("SGS") confirming anticipated
recoveries. A 40 tonne bulk sample has been delivered to SGS for a full
scale pilot plant trial scheduled to begin in late November or early
December, 2011. Hydrometallurgical testwork is also progressing with the
initiation of pilot scale testing, while the 2011 drilling program was
concluded on October 16. An updated resource estimate for the Nechalacho
deposit will be available in December 2011.
An important milestone was reached in the permitting process on
November 3, 2011, with the Company's Developers Assessment Report being
deemed in conformity with the Environmental Assessment Terms of Reference
by the Mackenzie Valley Environmental Impact Review Board. The
environmental assessment process has been progressing more slowly than
expected creating some risk of a delay in receiving final operating
permits.
Flotation Processing Testwork
In August 2011, a continuous pilot scale concentrate production
run was completed at SGS utilizing 3.7 tonnes of mineralized drill core
recovered from the heavy rare earth rich Basal Zone part of the
Nechalacho deposit. The main objective of this work was to produce
concentrate for hydrometallurgical testwork. Results from this production
run, and results from locked cycle tests ("LCTs") carried out
prior to the production run, yielded results indicating that the mineral
recoveries projected in the Company's Prefeasibility Study
("PFS") can be achieved.
The recoveries reported in the PFS were 89.7% for zirconium oxide
("ZrO2"), 79.5% for all rare earth oxides ("REO"),
68.9% for niobium oxide ("Nb2O5") and 63%
for tantalum oxide ("Ta2O5"). The LCTs on
the 3..7 tonne feed sample gave higher recoveries for Ta2O5
and Nb2O5, at an average of 74.3% and 73.9%
respectively, similar recoveries for REE at an average of 78.5% and lower
recoveries for ZrO2 at an average of 83.8%. The concentrate
production run also gave slightly higher Ta2O5 and
Nb2O5 recoveries at 65.4% and 69.7% and lower REO
recovery at 73.1% and ZrO2 recovery at 82%.
The slightly lower average REO recoveries in the production run
are due to full stability not being reached and the mass of slimes
removed being above target (15.8% instead of targeted 8%). These issues
will not recur with the much larger sample size (40 tonnes) planned for
the full scale pilot plant. It is considered that the LCTs provide the
best indication of expected recoveries from the sample tested.
Hydrometallurgical Testwork
The hydrometallurgical process is comprised of two main steps, an
acid bake to initially break down the rare earth minerals most
susceptible to chemical attack followed by a caustic crack of the residue
of those minerals most resistant to chemical attack, mainly zircon. The
filtrate from the acid bake step will be processed for the recovery of
the mixed light rare earths and rare metals. It is expected that the
recovery process will include purification of the solution using solvent
extraction followed by double sulphate salt precipitation of the light
rare earths using sodium sulphate, filtration to recover the rare earths,
processing to remove iron from the double sulphate salt filtrate, then
precipitation and filtration of residual heavy rare earths. As noted, the
residue from the acid bake process will contain the ZrO2, Nb2O5
and Ta2O5 and about half the heavy rare earths.
The acid bake process has been adequately proven at the bench
scale, although some further optimization tests are taking place. The
present focus is on pilot scale testing now that larger quantities of concentrate
are available from the 3.7 tonne flotation concentrate production run.
Two types of acid bake reactor (pug mill and rotary kiln) with a feed
rate of about four kg/hour are being tested. After the initial tests are
completed and one type of reactor chosen, longer duration tests will
begin using concentrate from the 40 tonne flotation pilot plant. The acid
bake residue is subject to caustic cracking, leaching and then recovery
and precipitation of the rare earths, ZrO2, Nb2O5
and Ta2O5. Bench scale testwork to optimize these
processes are on-going.
Flotation and hydrometallurgical progress has been slower than
anticipated mainly due to capacity issues with the Company's service
providers, who have been experiencing very high demand for processing and
analytical services as the global mining boom continues..
Drilling Update
A major objective of the drill program in the past year has been
to generate the 40 tonne bulk sample for metallurgical testing, with a
large diameter PQ drill rig being one of the two rigs on the property.
The bulk sample comprises 20 tonnes of Upper Zone and 20 tonnes of Basal
Zone mineralization. The Upper Zone mineralization is for testing and
ensuring stability prior to the processing of the Basal Zone core. As
well as testing the flotation scheme, it is anticipated that this pilot
should provide some two to four tonnes of concentrate for
hydrometallurgical pilot plant testing.
The 2011 summer drilling program was concluded on October 16 at a
total of 13,979 metres in 72 holes, bringing the total drill production
in 2011 to 26,203 metres in 137 holes. In addition to bulk sample
collection, the drilling program achieved the following objectives:
* Detailed drilling in the
areas targeted for initial mine development.
* Geotechnical drilling of the
ramp route and proposed underground crusher location.
* Geotechnical and
hydro-geological drilling at the proposed tailings disposal site.
All samples from the resource drilling will have been submitted
for analysis by mid November, and typically the analyses take over two
months to be completed. All the results from the 2011 winter drilling
have been compiled, although some check analyses are still awaited, and
an updated resource estimate is in preparation. This will be ready for
disclosure in December 2011. Drilling is scheduled to resume at the site
in mid to late January 2012, with the objectives of detailed drilling of
the area of the five year mine plan, and acquisition of additional bulk
sample material.
Permitting Update
Avalon completed and filed its Developers Assessment Report
("DAR") on May 20, 2011, (otherwise known as an Environmental
Impact Statement), required by the Mackenzie Valley Environmental Impact
Review Board ("MVEIRB"). The development of a DAR is an
exhaustive study that typically takes more than a year to complete upon a
company receiving the final Terms of Reference from MVEIRB. Avalon, with
support from EBA Engineering (a Tetra Tech Company), completed and
submitted its DAR in just three months upon receiving the final terms of
reference from MVEIRB.
Response times from MVEIRB on the Company's submissions have been
slower than expected. Avalon only received notification from MVEIRB on
November 3, 2011, that the DAR had been deemed in conformity with the
Terms of Reference, over five months after its submission. This has put
the process behind schedule, creating some risk of a delay in receiving
final operating permits.
Market Development
Avalon is continuing discussions with the four Asian companies
that have each signed a Memorandum of Understanding regarding off-take
agreements. The four companies are interested in investing in Avalon's
Thor Lake HREE project or providing Avalon with technical assistance in
exchange for becoming partners in the project, and the right to purchase
separated rare earth oxides for a specific period of time. Discussions
are progressing well with due diligence and negotiation meetings
scheduled over the next few weeks with all four parties. No binding
agreements have yet been signed.
Qualified Persons
Dezhi Qi, P. Eng. and John Goode, P. Eng. are Qualified Persons as
defined by National Instrument 43-101 and have provided the technical
information relating to metallurgy in this news release.The Company's
Vice-President, Exploration, William Mercer, P.Geo. (Ont), P. Geol (NWT)
is providing overall direction on the project. The qualified persons for
the purposes of this news release are Dezhi Qi, P. Eng, John Goode, P.
Eng., William Mercer, P. Geo., and Donald Bubar, P. Geo. (Ont),
President.
About Avalon Rare Metals Inc. (TSX and NYSE-Amex: AVL)
Avalon Rare Metals Inc. is a mineral development company focused
on rare metals deposits in Canada. Its flagship project, the 100%-owned
Nechalacho Deposit, Thor Lake, NWT, is emerging as one of the largest
undeveloped rare earth elements resources in the world. Its exceptional
enrichment in the more valuable 'heavy' rare earth elements, which are
key to enabling advances in green energy technology and other growing
high-tech applications, is one of the few potential sources of these
critical elements outside of China, currently the source of 95% of world
supply. Avalon is well funded, has no debt and its work programs are
progressing steadily. Social responsibility and environmental stewardship
are corporate cornerstones. Avalon's performance on community engagement
in the north earned it the 2010 PDAC Environmental and Social
Responsibility Award.
Shares Outstanding: 102,861,986. Cash resources: approximately $65
million.
To find out more about Avalon Rare Metals Inc., please visit our
website at www.avalonraremetals.com. For questions and feedback, please
e-mail the Company at ir@avalonraremetals.com or phone Investor
Relations at 416-364-4938.
This news release contains "forward-looking statements"
within the meaning of the United States Private Securities Litigation
Reform Act of 1995 and applicable Canadian securities legislation.
Generally, these forward-looking statements can be identified by the use
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of activity, performance or achievements of Avalon to be materially
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management believes to be reasonable at the time such statements are made.
Although Avalon has attempted to identify important factors that could
cause actual results to differ materially from those contained in
forward-looking statements, there may be other factors that cause results
not to be as anticipated, estimated or intended. There can be no
assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated
in such statements.. Such forward-looking statements have been provided
for the purpose of assisting investors in understanding the Company's
plans may not be appropriate for other purposes. Accordingly, readers
should not place undue reliance on forward-looking statements. Avalon
does not undertake to update any forward-looking statements that are contained
herein, except in accordance with applicable securities laws.