Nkombwa Hill: Exploration Defines Additional Area

 

30 January  2013

Galileo Resources Plc

("Galileo" or the "Company")

 

Exploration Results Define an Additional Area of REE Mineralisation at Nkombwa Hill Rare Earth Project, Zambia

 

Galileo Resources Plc (AIM: GLR), the emerging African Rare Earth exploration and development company, is pleased to report the results of a detailed rock chip sampling programme comprising  353 samples over a second target for rare earth element (REE) mineralisation at the Nkombwa Hill Rare Earth Project; the second target was identified from ground radiometric surveying and orientation rock chip sampling. This follows on from outcrop sampling on the initial target as announced by African Consolidated Resources Plc on 17 May 2011. The results identified the second target area to contain significant high-grade REE mineralisation.

Highlights

·     111 (36% ) of  the outcrop samples,  assayed more than 2% total rare earth oxide ('TREO') with an average assay of 4.17% TREO

·     161 (46%) of the samples,  assayed more than 1% TREO with an average of 3.34% TREO

·     The  highest sample recorded  was  22.32% TREO

·     The complete suite of 353 samples averaged 1.7%TREO   

·     Several areas of continuous REE mineralisation are identified, the largest being more than 350m long and 40-80m in width

·     The REE mineralisation is hosted in a rock unit that contains very low contents of acid-consuming minerals suggesting  potentially readily leachable  REE with low acid cost  

 

Colin Bird, Executive Chairman of Galileo Resources, said: "The results of this sampling programme extend the area of high-grade rare earth mineralisation we have identified in the Nkombwa Hill Project.  We can now progress towards establishing a resource, and in order to achieve this, have already started work on establishing a suitable access road to the top of Nkombwa Hill. Drilling will commence as soon as the heavy summer rains end in late March 2013."

 

Sampling

The Company has completed a programme of detailed surface rock chip sampling over a second identified REE target area - the "Central" target - in the Nkombwa Hill Project. 

A total of 353 outcrop rock chip samples were collected along a series of closely spaced traverses across the body of silicified carbonatite rock underlying the crest area of Nkombwa Hill.  Sample spacing was 4-12m along traverses 25 to 30m apart; average sample size was 1.7 kg.  The samples were assayed for the full suite of REE and a suite of relevant major and trace elements by Intertek Genalysis laboratories in Perth, Australia.

Results

The average total rare earth oxide (TREO) composition of the 353 samples assayed is 1.70% and the most enriched sample in the suite contained 22.32% TREO, close to highest value recovered thus far at Nkombwa Hill of 23.61%.    Table 1 provides summary statistics for the suite of assayed samples.

Table 1: Summary statistics

sample range	%TREO	number
Total	1.70	353 (100%)
mean >1%	3.34	161 (46%)
mean >2%	4.17	111 (31%)
Maximum	22.32

The sample traverses reveal several zones where successive samples have TREO contents in excess of 3% over 80-150m of strike - the largest lies along the south-eastern edge of the target and is at least 50m wide and 300m long.

Previous mineralogical studies of the silicified carbonatite demonstrated that the predominant REE mineral is a green, low-The monazite accompanied by lesser amounts of bastnaesite and traces of cerianite. The host material is predominantly composed of fine-grained cherty silica and iron-oxides with very low carbonate (acid-consuming) minerals; content -less than 2%.  This suggests that rare earths should potentially be able to be extracted into solution from the milled (run of mine) ore by simple acid cracking and leach.

The current focussed sampling programme is the second to be completed at Nkombwa Hill. An equivalent surface sampling programme undertaken in December 2011 over the "North West Crest" target, 300m to the north-west, revealed a well-defined tabular zone of REE mineralisation 25-50m wide and continuous over at least 350m of strike and open at each end.  Here, the mineralisation is hosted in sub-vertically disposed coarse-grained ankeritic- carbonatites and was traced over more than 150m of elevation: this suggests that the high REE grades encountered at surface should persist at depth.

An access road is currently being constructed to the crest of Nkombwa Hill.  A drilling programme has been designed to establish the extent of the mineralisation in each of the delineated targets and will commence as soon as the heavy summer rain season ends in late March to early April 2013.

 

The Nkombwa Hill Project

The Nkombwa Hill project is located in the north east of Zambia, 22km east of the major T2 paved national road between Lusaka (Zambian capital) and the Tanzanian border.

Through a Heads of Agreement concluded with Rare Earth International (REI), Galileo earned the right to acquire 70% of REI's interest in a joint venture signed with Fisherman Ltd, a wholly-owned subsidiary of African Consolidated Resources plc, who hold a prospecting right over the Nkombwa Hill area.  REI will earn a 30% interest in the REE on completion of a JORC compliant Inferred Resource and spending US$750,000 within 2 years; increasing to 50% once at least half of the inferred resource is converted to Indicated category, within a further 2 years with an additional expenditure commitment of US$600,000. ACR/Fisherman can elect thereafter to contribute with REI as manager or REI can achieve a 75% interest by fully funding a bankable feasibility study. If ACR elects not to co-fund the feasibility study  then  Galileo could earn up to a maximum of 75% interest in the Nkombwa Project. 

The Nkombwa Hill carbonatite plug is situated in the upper Luangwa Valley, which forms part of the Western Limb of the East African Rift system. The carbonatite intrusive forms a prominent oval-shaped (1800 x 1500m) hill rising 300 m above the surrounding flat countryside.  The complex is composed of several carbonatite types, all predominantly dolomitic in character.  Mica-rich carbonatite is common in the outer parts of the complex while a medium-grained, uniform-textured dolomite carbonatite ("rauhaugite") makes up most of the central parts of the carbonatite body.  Several lenticular and dyke-like bodies of vari-textured, coarse-grained to pegmatoidal iron-rich (ankerite and siderite bearing) carbonatite are found in the central parts of the complex.  Much of the central crest area of Nkombwa Hill is underlain by fine-grained silicified carbonatite produced by pervasive replacement of earlier formed carbonatites.  Boulder rubble from these outcrops drapes much of the south-western face of the Hill.

The Nkombwa Hill carbonatite has been investigated by several institutions for a range of commodities since it was first recognised as a carbonatite by geologists of the country's Geological Survey in 1952. These endeavours focussed primarily on phosphate and niobium with little attention on REE.

REE-focussed exploration commenced in late 2010 when REI concluded an earn-in agreement with Fisherman Mining Ltd, a wholly-owned subsidiary of African Consolidated Resources and holder of a Large Prospecting License over the area enclosing the Nkombwa Hill carbonatite.  Roan Selection Trust drilled two diamond core holes (NB-1 and NB-2) into the northern margin of the complex during 1966/67 that intersected several zones having elevated La and Ce concentrations.  Cores from these holes are stored in the Chamber of Mines core shed in Kalulushi and were re-sampled: assaying selected sections for the full suite of REE confirmed the presence of REE mineralisation in coarse-grained iron-rich dolomitic carbonatite zones, the most significant having 7.98% TREO over 6.2m and 5.47% TREO over 4.1m. 

A low altitude, high resolution airborne magnetic and radiometric survey of the area was flown and processed to delineate prospective areas.  Systematic surface sampling, accompanied by ground radiometric traversing, enabled three areas to be targeted for higher density sampling: these are termed the North West Crest, Central and South East targets.  Both close-spaced outcrop sampling has now covered the North West Crest and Central targets and drill-ready zones of REE mineralisation have been identified in both.

 

For further information, please contact:

Colin Bird, Chairman  & CEO	Tel +44 (0)20 7581 4477
Andrew Sarosi, Executive Director	Tel +44 (0) 1752 221937
Beaumont Cornish Limited: Nominated Advisor and Broker Roland Cornish/James Biddle	Tel +44 (0)20 7628 3396
Shore Capital Stockbrokers Limited: Joint Broker Jerry Keen/Toby Gibbs	Tel +44 (0)20 7408 4090
Gable Communications Justine James	Tel +44 (0) 7193 7463 M  +44 (0) 7525 324431

 

A copy of the announcement is available on the Company's website www.galileoresources.com

 

Technical Sign-Off

Dr Jock Harmer, Technical Consultant to Galileo, who holds a Ph.D. Geochemistry, University of Cape Town, is a Registered Professional Natural Scientist with SACNASP, and a 'qualified person' as defined under the AIM Rules for Companies and a competent person under the SAMREC, JORC and NI 43-101 reporting standards. The technical parts of this announcement have been prepared under Jock Harmer's supervision and he has approved the release of this announcement.

Notes

Galileo Resources is a natural resource exploration company. The Company has an experienced management team with proven technical and commercial background. The flagship property is the Glenover Phosphate concession, which produced phosphate for many years. Phosphate however, is now subordinated to Rare Earth Elements (REEs). The project area is known to contain REEs and that the grades, if of sufficient size and continuity may well lead to a medium-sized operation for the production of REOs.

 The Company can acquire a 35% earn-in interest with option to purchase an additional 15% interest in the Nkombwa Hill Project in Zambia prior to feasibility study.  Intensive surface sampling over the last 18 months has identified two drill-ready targets having significant levels of REE mineralisation.  Kilogram-scale outcrop samples have returned rare earth contents of up to 23.6% TREO; exploration samples collected over the entire carbonatite complex that contain over 1% TREO average to 3.58% TREO.

 

Technical Glossary

Acid cracking                          a process of disintegrating minerals in ore by the addition of acid and heating 

Bastnaesite (or bastnäsite):              a rare earth fluoro-carbonate ore mineral having the generalised formula RCO₃.F (R denoting a mix of REE). The shorthand bastnaesite-(Ce) is often used to denote bastnaesite containing mostly LREE and bastnaesite-(Y) for bastnaesite enriched in HREE.

Cerianite:                                 nominally CeO₂ but can contain appreciable amounts of other REE along with fluorine; usually represents a late alteration product of primary REE minerals. 

Monazite:                                a rare earth phosphate ore mineral having the generalised formula RPO₄ (R denoting a mix of REE). The shorthand monazite-(Ce) is often used to denote monazite containing mostly LREE and monazite-(Y) for monazite enriched in HREE.

Phosphate (P₂O₅):                  an oxide of phosphorus

Rare earths (REE):                 a set of sixteen chemically similar elements in the periodic table made up of the fourteen stable lanthanoids lanthanum to lutetium, plus yttrium and scandium.  On the basis of their chemical properties, the REE may be subdivided into the light REE (LREE), being the elements from lanthanum to gadolinium; and the heavy REE (HREE), the remaining seven lanthanides terbium to lutetium and yttrium.

REO (rare earth oxide):         the oxide form of the rare earth elements 

Rock chip sampling:              Collection of rock samples from surface exposures

Th:                                             The element Thorium

TREO:                                        total rare earth oxides

 

The economically significant rare earth elements include:

La: Lanthanum                        Used extensively as a catalyst in the refining of crude oil; its ability to store 400 times its volume of hydrogen is utilised in rechargeable NiMH batteries that are an essential component of hybrid motor vehicles; La changes the refractive index of glass and is used in the manufacture of lenses for digital cameras.

Ce: Cerium                               Primary uses are in high quality polishing of glass, silicon wafers, solar cells; in auto catalytic converters; rich red colour pigments; low energy light bulbs.

Pr: Praseodymium                 As an additive Pr gives a pure yellow colour to glass and brilliant pastel greens and yellows for glazes; can be used along with Nd in permanent magnets (see below).

Nd: Neodymium                      Major application is in the manufacture of NdFe(iron)B(boron) permanent magnets (neo-magnets), the most powerful permanent magnets currently known.  NdFeB magnets are essential in new "clean energy" technology such as wind turbines and hybrid and electrical motor vehicles; their high strength have allowed the miniaturising of hard disc drives and personal audio devices.  Nd, with Y, is widely used in the manufacture of lasers.  

Eu:  Europium                         Widely used as a phosphor: Eu alloys uniquely provide a perfect red colour for LED, LCD and plasma television and monitor screens; also used in thin film superconductor alloys and in lasers

Gd: Gadolinium                      Uses include neutron capture capability and in compounds as a contrasting agent in radiography and magnetic resonance imaging in medical diagnostics

Sm: Samarium                        Alloyed with cobalt, Sm forms a strong permanent magnet that has the highest resistance to thermal demagnetization.

Y: Yttrium                                 Uses include lasers, as host for europium in TV red phosphor; alloyed with boron and cobalt high temperature superconductors and microwave filters