Search Minerals Announces Revised Preliminary Economic Assessment for Foxtrot

Search Minerals Inc. (TSXV:SMY) announced a revised Preliminary Economic Assessment prepared by Roscoe Postle Associates Inc. for the Foxtrot Rare Earth Element Project in Labrador, Canada. Highlights include a reduction in capital costs to $ 221M from $ 469M, with a 3.8 year payback; net revenue has increased $ 110/tonne milled and Opex costs increased $ 38/tonne.

As quoted in the press release:

HIGHLIGHTS:

• Selective mining of High Grade Core REE material from an initial 4 year open pit followed by a 6year selective underground mining operation, with a 1,500 tpd mining mill rate.
• Reduction in capital costs to $ 221M from $ 469M, with a 3.8 year payback, $ 219M NPV (at a discount rate of 10%) and 27% pre-tax IRR
• Net revenue has increased $ 110/tonne milled and Opex costs increased $ 38/tonne, for a net increase in revenue per tonne of $ 72; this increased margin will help protect Search from commodity price fluctuations
• The updated PEA scenario also provides for a smaller environmental footprint (i.e., smaller open pit, smaller waste dump and smaller tailings pond) and good potential for extended mine life.
• The revised project will focus on higher grade REE material mined over LOM of 0.89% total REE (“TREE”) on average, which compares to the 0.58% TREE on average for the original bulk open pit concept

Search Minerals President Jim Clucas said:

We are pleased with the results of the revised PEA as it reinforces our view of Foxtrot as an exceptional project that can be developed.  The Foxtrot Project is the cornerstone of our Rare Earth strategy, as it is the first project of what we believe will be many in this district, which Search controls. The smaller scale mining concept is more attractive and achievable with respect to project financing and development without affecting economic returns in a difficult market. The need to originate new sources of neodymium and dysprosium, given their tight fundamentals and dependency on China are now widely evident. The Foxtrot Project presents itself as a unique alternative with further potential resources at depth in the Foxtrot deposit and in additional prospects in the Fox Harbour area.

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