technical report on the nechalacho deposit, thor lake project ...

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Table 17-1 Mineral Resource Summary BASAL ZONE RESOURCES INDICATED AREA Tonnes (millions) TREO % HREO % HREO/TREO % ZrO2 % Nb2O5 % Ta2O5 ppm TREO equiv Tardiff Lake 41.55 1.61 0.34 20.61 2.99 0.41 397 2.07 West Long Lake 15.94 1.42 0.31 21.01 2.99 0.38 392 1.85 TOTAL 57.49 1.56 0.33 20.72 2.99 0.40 396 2.01 INFERRED Tardiff Lake 19.34 1.66 0.36 20.54 3.08 0.42 423 2.14 Thor Lake 79.27 1.30 0.24 18.80 2.78 0.37 338 1.71 West Long Lake 8.98 1.17 0.21 17.12 2.71 0.33 347 1.56 TOTAL 107.59 1.35 0.26 18.97 2.83 0.37 354 1.77 UPPER ZONE RESOURCES INDICATED AREA TREO % HREO % HREO/TREO % ZrO2 % Nb2O5 % Ta2O5 ppm TREO equiv Tardiff Lake 23.63 1.50 0.15 10.44 2.09 0.32 194 1.89 West Long Lake 7.02 1.40 0.13 9.63 2.14 0.27 186 1.77 TOTAL 30.64 1.48 0.15 10.26 2.10 0.31 192 1.86 INFERRED Tardiff Lake 28.66 1.34 0.12 9.19 1.96 0.32 175 1.71 Thor Lake 81.66 1.24 0.12 9.72 2.54 0.36 206 1.65 West Long Lake 5.67 1.34 0.12 9.44 1.95 0.26 170 1.68 TOTAL 115.98 1.27 0.12 9.57 2.37 0.34 196 1.67 TOTAL COMBINED INDICATED HREO/TREO AREA TREO % HREO % ZrO2 % Nb2O5 % Ta2O5 ppm TREO equiv % UPPER AND BASAL 88.13 1.53 0.26 17.08 2.68 0.37 325 1.96 TOTAL COMBINED INFERRED UPPER AND BASAL 223.57 1.31 0.19 14.10 2.59 0.36 272 1.72 Notes: 1. CIM definitions were followed for Mineral Resources. 2. HREO (Heavy Rare Earth Oxides) is the total concentration of: Y 2 0 3 , Eu 2 0 3 , Gd 2 0 3 , Tb 2 0 3 , Dy 2 0 3 , Ho 2 O 3 , Er 2 0 3 , Tm 2 0 3 , Yb 2 0 3 and Lu 2 0 3 . 3. TREO (Total Rare Earth Oxides) is HREO plus: La 2 0 3 , Ce 2 0 3 , Pr 2 0 3 , Nd 2 0 3 and Sm 2 0 3. 4. Mineral Resources are estimated using price forecasts for 2014 for rare earth oxides prepared early in 2010. Some of these prices are higher and some are lower than current prices. The prices used are the same as in the June 14, 2010 disclosure. 5. Mineral Resources are undiluted. 6. A cut-off NMR grade of $260 Can was used for the base case. NMR is defined as "Net Metal Return" or the in situ value of all the payable rare metals in the ore net of estimated metallurgical recoveries and processing costs. 7. An exchange rate of 1.11 was used. 8. ZrO 2 refers to Zirconium Oxide, Nb 2 O 5 refers to Niobium Oxide, Ta 2 O 5 refers to Tantalum Oxide, Ga 2 O 3 refers to Gallium Oxide. Technical Report 43-101 – March 13, 2011 Page 17-2 Prepared by Avalon Rare Metals Inc.
9. TREO equivalent is estimated by calculating a weighted average NMR per kg for the rare earths and rare metals (Zr, Nb, Ta) in an given interval, and re-estimating the interval assuming that all the value was in rare earths only. 10. The two main differences to previous estimates were that eight composites were used per block, versus 15 in the estimate released in July 19, 2010 and the Basal Zone was not flattened onto the lower contact prior to block estimation. All other parameters were similar. RESOURCE DATABASE The January 27, 2011 resource estimate for the Nechalacho deposit is based upon detailed core logging, assays and geological interpretation by Avalon's consulting geologists. In total, 291 drill holes (out of a database of 316 drill holes) were used for the estimate of which 45 are historic and 246 are Avalon diamond drill holes (drilled and sampled from 2007 to 2010). Complete REE analyses (plus Zr, Nb, Ga, and Ta) are available for six historic holes and all 246 Avalon holes. These holes and their related assays form the basis for the creation of two domains of REE mineralization: an upper light rare earth element-enriched domain (Upper Zone) and a lower heavy rare earth element-enriched domain (Basal Zone). In addition a further 19 Avalon drill holes were not used in the calculation either due to the entire hole encountering diabase and being abandoned (five holes) or due to being outside the limits of the model (15). Of the latter, a number of holes and in particular L10-309, L10-310, L10-311 encountered significant intersections of mineralization. Table 17-2 displays the source and number of drill holes used for the resource estimate. Table 17-3 shows the number of partial or complete REE analyses completed by both Avalon and other companies and includes diamond drill holes outside the resource calculation. Table 17-2 Drill Hole Information for this Resource Estimate Avalon Rare Metals Inc. – Nechalacho Project Data Source Number of Holes Metres Years Notes Other Companies 45 5,242 1978 to 1988 Not all information could be validated Avalon 246 54,611 2007 to 2010 Metreage does not include restarted holes Totals 291 59,853 Technical Report 43-101 – March 13, 2011 Page 17-3 Prepared by Avalon Rare Metals Inc.
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TECHNICAL REPORT ON THE NECHALACHO
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TABLE OF CONTENTS 1. SUMMARY ......
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QUALITY ASSURANCE / QUALITY CONTROL
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Warehouse..........................
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LIST OF TABLES Table 1-1 Summary of
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Table 18-9 Mine Ventilation Quantit
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Table 18-54 Table 18-55 Pine Point
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LIST OF APPENDICES APPENDIX A Block
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Table 1-1 Summary of Mineral Resour
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Royalties. The net revenue generate
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• The products will be shipped in
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• Income taxes and NWT mining roy
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2. INTRODUCTION This report
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Figure 2-2 Project Sites, Thor Lake
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Table 2-1 Rare Earth Element Data A
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LIST OF ABBREVIATIONS Units of meas
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4. PROPERTY DESCRIPTION AND LOCATIO
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The mining leases have a 21-year li
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5. ACCESSIBILITY, CLIMATE, LOCAL RE
Page 39 and 40: Fort Resolution is located on the s
Page 41 and 42: producing a tantalum concentrate, b
Page 43 and 44: Figure 7-2 Detailed Deposit Geology
Page 45 and 46: The nepheline-sodalite syenite host
Page 47 and 48: LATE TECTONIC FAULTS Faults are pre
Page 49 and 50: 8. DEPOSIT TYPES The mineral deposi
Page 51 and 52: The Ore (Nechalacho) Nepheline Soda
Page 53 and 54: from section to section - this may
Page 55 and 56: Table 9-1 Average Percent of Ore Mi
Page 57 and 58: The Nechalacho deposit alteration s
Page 59 and 60: 11. DRILLING Since 1977, diamond dr
Page 61 and 62: Foraco drill rig was added in Febru
Page 63 and 64: CORE LOGGING AND CORE RECOVERY The
Page 65 and 66: A high R 2 (and all regressions had
Page 67 and 68: 12. SAMPLING METHOD AND APPROACH A
Page 69 and 70: such as Illimausaq in Greenland, a
Page 71 and 72: 13. SAMPLE PREPARATION, ANALYSES AN
Page 73 and 74: limited set of elements; however, s
Page 75 and 76: CONCLUSIONS Avalon’s conclusions
Page 77 and 78: Tb and Dy) were routinely monitored
Page 79 and 80: As part of the QA/QC program, Avalo
Page 81 and 82: Table 14-4: Comparison of Niobium,
Page 83 and 84: shows more deviation, with ALS MS81
Page 85 and 86: 16. MINERAL PROCESSING AND METALLUR
Page 87 and 88: In a typical test, for example CCr-
Page 89: 17. MINERAL RESOURCE AND MINERAL RE
Page 93 and 94: Table 17-4 Sample Information Avalo
Page 95 and 96: Figure 17-1 Distribution of REO Com
Page 97 and 98: Assay Statistics for Upper Zone* *
Page 99 and 100: CUT-OFF GRADE A previous public res
Page 101 and 102: underneath for SG measurement purpo
Page 103 and 104: Figure 17-4 Density Measurements AL
Page 105 and 106: was equal to 60 m by 60 m by 30 m a
Page 107 and 108: Table 17-12 Detailed Resource Break
Page 109 and 110: Table 17-13 Indicated Mineral Resou
Page 111 and 112: Figure 17-7 Outline of Area of Indi
Page 113 and 114: The recoveries estimated for the fl
Page 115 and 116: grades were based upon the grades w
Page 117 and 118: Figure 18-1 Thor Lake Site Layout T
Page 119 and 120: Scott Wilson RPA recommends the use
Page 121 and 122: During discussions with the mine de
Page 123 and 124: Figure 18-4 Mine Layout Some of the
Page 125 and 126: Figure 18-5 Mine Development Schema
Page 127 and 128: Table 18-2 Development Tonnage Brea
Page 129 and 130: Until the crusher is in place and t
Page 131 and 132: Lateral Development The access decl
Page 133 and 134: Equipment will be selected based up
Page 135 and 136: Table 18-6 Estimated Electrical Loa
Page 137 and 138: VENTILATION The mine ventilation is
Page 139 and 140: for closing unused areas and for ch
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Mine Fan Horse Power Using the same
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Paste Fill System A paste fill syst
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Communications Mine communications
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completion of the 30 m to 50 m long
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HEALTH AND SAFETY All crew will be
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The crushing plant is designed for
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Table 18-12 (Cont’d) Principal Pr
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Figure 18-9 Hydrometallurgical Plan
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The Pine Point hydrometallurgical f
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Decant pipeworks have been included
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• Development of pre-feasibility
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Design Basis The pre-feasibility le
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non-woven geotextile) to prevent da
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divert surface drainage away from r
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A high pressure (200 psi) compresse
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Fuel deliveries are assumed to be s
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Mill Supplies The key mill supplies
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Table 18-15 Surface Equipment Fleet
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Figure 18-10 Thor Lake Temporary Ba
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• Together with the unloading log
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it will be necessary to upgrade the
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Table 18-16 Hydrometallurgical Plan
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Table 18-17 Surface Mobile Equipmen
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Rare Earth FOB China* FOB China** P
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• loparite and eudialyte in alkal
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Table 18-18 Rare Earth supply - 200
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Table 18-20 Rare Earth Demand by Ap
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Table 18-22 Proposed New REO Projec
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in China. On this basis, Avalon is
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Determine Prices for Avalon’s Pro
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The balance of niobium supply is co
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epresenting about 18% of total zirc
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Table 18-25 Historic Chinese Export
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Figure 18-16 Tantalum Markets - 200
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the price for tantalum chemicals in
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Surface Hydrology The Thor Lake dra
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seven) have occurred more frequentl
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elative to uranium, the overall eff
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interviews conducted for the nearby
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Wildlife Early science-based wildli
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Other environmental permits/approva
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TAXES The NWT diesel tax has been i
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Table 18-31 Mine Capital Cost Estim
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Table 18-33 Surface Infrastructure
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Table 18-36 Indirect Cost Estimate
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Table 18-37 Contingency Allowance A
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Operating Cost Exclusions The opera
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Table 18-40 Underground Mine Cost S
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Table 18-41 Mine Cost Details Avalo
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Thor Lake Surface The Thor Lake sur
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Table 18-45 Sales and Marketing Cos
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Table 18-47 Rail Car Load Limits Av
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there will be no overhauls in the i
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Other supplies and freight will be
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Table 18-55 Hydrometallurgical Plan
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Table 18-56 Cash Flow Summary Techn
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The sensitivity of the base case 8%
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19. INTERPRETATION AND CONCLUSIONS
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• The Mineral Reserves, which hav
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20. RECOMMENDATIONS The authors of
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21. REFERENCES BCC Research (2009):
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MDN Inc (2010): News Release Melvil
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Wardrop Engineering Inc. (2009): Th
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23. CERTIFICATES OF QUALIFIED PERSO
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CERTIFICATE OF QUALIFIED PERSON I,
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CERTIFICATE OF QUALIFIED PERSON I,
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Section 416000 Section 416100 Secti
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Technical Report 43-101 - March 13,
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