Greenland Minerals Set to Commence 2011 Field Program

Read Full Company Announcement 11 May 2011

Greenland Minerals and Energy Limited (“GMEL”, or “the Company”, ASX:GGG) is pleased to provide an overview of the 2011 field program that will soon be commencing in south Greenland. All work programs are part of the expanding feasibility studies on the Kvanefjeld multi-element project (rare earth elements, uranium, zinc). A number of important work programs are planned, including:

• Resource development drilling to establish initial JORC resource estimates at recently discovered multi-element deposits located within the broader project area
• Sterilisation drilling in potential infrastructure locations
• Stakeholder engagement programs
• Ongoing environmental baseline studies in areas under assessment for the mine site, processing plant and related infrastructure, and potential hydro-electric power facilities
• Field assessments for constructability studies relating to site selection for key infrastructure items

Key personnel have now mobilised to the Company’s operations base in Narsaq, south Greenland, and drill crews will be arriving onsite in the coming days.

Background

Greenland Minerals and Energy Ltd is a mineral exploration and development company operating in southern Greenland. The Company is primarily focused on advancing the Kvanefjeld multi-element project (both light and heavy rare earth elements, uranium, and zinc) through the feasibility phase and into mine development.

Kvanefjeld is the first of several deposits to be extensively drilled within the Company’s license over the northern Ilimaussaq Intrusive Complex; a unique geological entity that is highly prospective for specialty metals. A 619 million tonne JORC-code compliant resource has already been defined at Kvanefjeld (see Table 1), and initial drill intercepts were released in early 2011 from three new satellite deposits.

An Interim Pre-feasibility Report on the Kvanefjeld study was released in February 2010 that indicates the potential for the multi-element resources to sustain a large-scale mining operation for decades (for more information visit the Company’s website at http://www.ggg.gl). The Company has since been building a strong in-house technical team that is firmly focused on establishing an increasingly efficient and scalable development scenario. The Kvanefjeld multi-element project is permitted by the Greenland Government for full feasibility assessment, with work programs ramping up through 2011.

2011 Field Program

Resource Development Drilling

In the 2011 field program GMEL will be conducting further drilling to establish initial JORC-code compliant resource estimates on multi-element deposits at Zones 2 and 3, and at Steenstrupfjeld. The first drill intercepts from these deposits were released in early 2011, and confirmed that extensive multi-element mineralization occurs up to 7 km from the resource at Kvanefjeld. Three diamond drill rigs will be deployed with the aim of drilling approximately 15,000 m across the season. Figure 1 highlights the planned drill hole locations for the 2011 field season.

Sterilisation Drilling

A number of sterilization holes are planned to the east of the northern Ilimaussaq Complex in potential infrastructure locations. Previous sterilization holes drilled in 2009 adjacent to the Kvanefjeld plateau served to unearth a significant extension of mineralization from outcropping zones at Steenstrupfjeld. The sterilization drilling forms part of the investigations to evaluate a series of locations for the processing plant and related infrastructure. These locations will be evaluated technically, and discussed with Greenlandic stakeholders to determine the most appropriate location, which will then be subject to more detailed and thorough investigations.

Figure 1. Overview of the Ilimaussaq ore field showing the location of Kvanefjeld and new REE-U-Zn deposits that will be drilled during the 2011 field season. See previous company announcements and website for more information on Zones 2 and 3, and Steenstrupfjeld. Initial resource estimates for Zones 2 and 3 are aimed to establish the grade profiles of the new resources, such that they can be factored into development scenarios. Subsequent drilling will serve to grow the tonnage of each resource.

Stakeholder Engagement

Consistent with previous field seasons, GMEL will continue with stakeholder engagement to keep all parties up-to-date with progress on the Kvanefjeld project. A series of meetings recently took place in Greenland in early April to discuss the ‘terms of reference’ for upcoming social and environmental impact assessments with key stakeholder groups. This follows the procedures specified by Greenland’s Bureau of Minerals and Petroleum.

Infrastructure and Construction Studies

Engineering consultants will be visiting the Kvanefjeld project during the northern summer to gather information relating to constructability studies. These studies are aimed at establishing further technical information on potential sites for the location of key infrastructure items. These items include sites for a processing plant, as well as new port facilities.

Updates on the progress of various work programs in Greenland will be presented over the coming months, along with technical updates on metallurgy and process development.

Table 1. Statement of Identified Mineral Resources, Kvanefjeld Multi-Element Project, March 2011.

The information in this report that relates to exploration results, geological interpretations, appropriateness of cut-off grades, and reasonable expectation of potential viability of quoted rare earth element, uranium, and zinc resources is based on information compiled by Jeremy Whybrow. Mr Whybrow is a director of the Company and a Member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr Whybrow has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined by the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Whybrow consents to the reporting of this information in the form and context in which it appears.

The geological model and geostatistical estimation for the Kvanefjeld deposit were prepared by Robin Simpson of SRK Consulting. Mr Simpson is a Member of the Australian Institute of Geoscientists (AIG), and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined by the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Simpson consents to the reporting of information relating to the geological model and geostatistical estimation in the form and context in which it appears. 

View over the broader geography of GMEL’s multi-element project on the northern Ilimaussaq Complex located in southern Greenland. The fjords form a large-scale natural harbor system that is open to the north Atlantic shipping lanes all year round, and provide easy access to the project area. The distance from Narsaq to Narsarsuaq International Airport is 45km.
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