GME stocks on the rise following uranium exploration rights announcement
Australia-based Greenland Minerals and Energy Ltd (GME) stocks went up 10 per cent on the ASX from 58 cents to 64 cents on Monday, after the company announced it could start producing uranium on its Kvanefjeld property in Greenland.
The possibility opened up for the exploration and development company after the government of Greenland agreed to include radioactive materials in an exploration license covering the northern Ilimaussaq complex, which includes the Kvanefjeld rare earth element project and two emerging satellite deposits known as Zones 2 and 3.
Under the licensing framework, GME maintained the right to apply for an exploitation licence for all exploitable elements listed on the exploration licence. The exploration licence now covers radioactive materials, providing the company with the clear right to apply for the exploitation of radioactive elements, along with all other exploitable elements. However, explained the company in a press release, the granting of an exploitation license will depend on establishing an environmentally and socially sustainable development scenario that is economically robust.
GME took full ownership of the Kvanefjeld project in August this year, buying the outstanding 39% interest of the northern Ilimaussaq complex from project partner Westrip Holdings and Rimbal.
The Kvanefjeld project has international strategic significance, since Kvanefjeld can become a cost-effective cornerstone producer of critical rare earth elements, essential to energy efficient technologies and in short supply for many years to come, as well as a manufacturer of uranium oxide.
The Kvanefjeld resource includes the world’s largest JORC-code compliant resource of REEs, as well as a global top ten uranium resource. With the first resource estimates for Zones 2 and 3 slated for Q1 2012, the project’s overall resource base will increase substantially, further consolidating the northern Ilimaussaq complex as a prolific ore-field of genuine global significance.
The project is conveniently located near existing infrastructure in southernGreenland. “Deep water fjords provide direct shipping access to the project area and an international airport is located approximately 35 km away,” says GME managing director Roderick McIllree. He adds that a nearby lake system has been positively evaluated for a hydro-electric scheme to power the Kvanefjeld project.
Kvanefjeld is estimated to host a total resource of some 619-million tons, with 437-million tons estimated to be in the indicated category. The contained metal inventory includes 6.6-million tons of rare-earth oxides, 350-million pounds of uranium oxide, and three-billion pounds of zinc.
Metallurgical studies are now investigating the likelihood of developing the mine site as a large-scale multi-commodity operation with one of the world’s largest rare-earth production capacities.