The company has begun a drill program at its Burundi-based Gakara project, one of the highest-grade rare earths projects globally.
Rainbow Rare Earths (LSE:RBW) said Wednesday (January 9) that it has commenced a drill program at its Gakara project in Burundi.
Gakara is one of the highest-grade rare earths projects globally, with an estimated in situ grade of 47 to 67 percent total rare earth oxide, and is the only producing rare earths mine in Africa.
Drilling contractors have been engaged for the first phase of the program, which is expected to carry through Q1 2018. Rainbow’s core objectives are to improve its understanding of the current production area at Gasagwe, as well as to explore four geophysical anomalies identified by an airborne survey.
Additionally, there will be a point of focus on Kiyenzi, where a large, sill-like oval structure potentially 22 meters thick and 80 meters x 100 meters in size was discovered by a ground gravity survey earlier in the year. Should these drill results prove positive, a second phase of drilling will take place during Q2 and Q3 of this year, with the aim of producing a JORC-compliant resource statement in H2 2018.
Martin Eales, CEO of Rainbow, stated that “with the forecast demand in electric vehicles driving the growth for REEs and a strong cash balance following an oversubscribed institutional fundraising in December, we are in an excellent position to accelerate development at Gakara.”
Rainbow completed an IPO in January 2017, and began producing rare earth concentrates in Q4 2017. In December 2017, it shipped 25 metric tonnes of high-grade rare earths concentrates, and a further two shipments have now taken place.
The company is currently ramping up to a targeted run rate of 5,000 tonnes per annum (tpa) by the end of 2018 and 6,000 tpa by the end of 2019. Rainbow has a 10-year distribution and offtake agreement with multinational thyssenkrupp Raw Materials for the sale of at least 5,000 tpa of concentrate produced.
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Securities Disclosure: I, Nicole Rashotte, hold no direct investment interest in any company mentioned in this article.