Trading Symbol: TSXV: BMC Shares Outstanding: 166,283,160 WINDSOR,
NS, July 26, 2012 /CNW/ - Buchans Minerals Corporation ("Buchans
Minerals" or the "Company"), is pleased to announce the
acquisition, through its wholly-owned subsidiary, Canadian
Manganese Company Inc. ("CMC"), of property representing the
surface rights over a portion of the Plymouth manganese deposit on
the Company's Woodstock property in New Brunswick, Canada. The
acquired property covers an area of 130 acres of forested land and
was acquired from four vendors for aggregate consideration of
$380,000, an upfront bonus of $10,000 and 40,000 warrants
("Warrants"). Each Warrant is exercisable into one common share of
the Company at a price of $0.10 for five years from the date of
issuance. In addition, CMC has granted to the vendors,
collectively, a one percent gross sales royalty upon commencement
of commercial production on the acquired property. CMC retains
certain rights to buyback half of the royalty. The transaction is
subject to the approval of the TSX Venture Exchange. All securities
issued will be subject to a hold period of four months and a
day from the date of issuance. The Plymouth deposit is one of three
deposits acquired by the Company in 2010 and located within the
Company's 100% owned Woodstock Manganese mineral claims covering an
area of 14,331.8 acres (5,800 hectares). Project Overview Based on
historical work, these deposits potentially represent one of the
largest undeveloped manganese resources in North America. In
1957, previous operators, Strategic Manganese Corporation,
estimated a non-43-101 compliant, historic, uncategorized resource
estimate of 51.2 million short tons (46.5 million tonnes) averaging
10.9% Mn (manganese) and 13.3% Fe (iron) for the Plymouth
deposit. In addition, Strategic Manganese Corporation
estimated the North Hartford deposit to contain 50 million short
tons (45 million tonnes) grading 8% Mn and 12% Fe, and the South
Hartford deposit to contain 50 million short tons grading 8% Mn and
12% Fe((1)). Buchans Minerals is evaluating the Plymouth deposit
with a view to potentially producing electrolytic manganese metal
("EMM") by utilizing hydrometallurgical leaching technologies that
are currently in common use throughout the EMM industry. To date
Thibault & Associates Inc. of Fredericton, New Brunswick
("Thibault") has completed a comprehensive bench scale
hydrometallurgical program on behalf of Buchans Minerals that
successfully demonstrated that, at optimum leach conditions, leach
recoveries averaging 96.6% (range of 94% to 98%) could be achieved
using a single stage sulphuric acid leach (see May 3(rd), 2012 news
release). In addition, the leach solution purification portion of
the test program resulted in the production of a high purity
manganese sulphate electrolyte, which is expected to produce high
grade EMM, based on Evan's Diagram predictions, at greater than
99.7% manganese content. Based on the results of the bench scale
test program and mass balance modeling of the proposed
hydrometallurgical process, the overall recovery of manganese is
expected to be approximately 90%. Based on the bench scale test
program results and with the use of many conventional unit
operations in the design of the process block diagram, Thibault
have established ore grinding requirements, estimated reagent
consumption levels, developed block diagrams, established
theoretical energy requirements and produced a dynamic economic
model which simulates the process flowsheet and quantifies
conceptual operating and capital costs. The model has proven
invaluable in optimizing conditions that may maximize the predicted
economics of the project. A treatment rate of 3,000 tpd producing
about 100,000 tpa EMM over thirty years is currently being
evaluated. Thibault have identified a number of additional process
refinements that may further optimize the technical and economic
viability of the hydrometallurgical process. Buchans Minerals
intends to pursue such refinements in the near future. Minco
Evaluation Following an announcement on April 30, 2012, Buchans
Minerals has granted Minco plc. ("Minco") the exclusive right, for
a period of six months (ending October 31(st), 2012), the right to
conduct a full evaluation and due diligence on the Woodstock
manganese property with a view to potentially entering into a
joint-venture agreement with Buchans to develop the Woodstock
manganese project. Minco has paid Buchans Minerals $1 million for
the exclusive six month option, which funds may be used during the
option period primarily for the advancement of the Woodstock
property. Minco are currently reviewing the Company's reports on
the Woodstock property that include a Marketing report by the CPM
Group, a hydrometallurgical report by Thibault and an economic
evaluation report by Thibault. If during the exclusive Woodstock
option period Minco elects to develop the Woodstock project, the
form and terms of a joint-venture agreement will be negotiated
between Minco and Buchans prior to the expiry of the Woodstock
Option. Electrolytic Manganese Metal Market: ((2) (3)) The EMM
market began to significantly expand in 2000 when stainless steel
production in China began to make use of EMM as a replacement for
nickel with great success. Since 2002 development of
chrome-manganese stainless steel production has been swift,
dramatically increasing demand for manganese and accelerating
development of the EMM industry, particularly in China. Worldwide
demand rose from 250,000 tonnes in 2002 to over 1,532,000 tonnes in
2011, a 513% increase in 9 years, with China supplying 97% of
demand, primarily from low grade manganese carbonate ores.( )The
average manganese content of Chinese carbonate ores currently being
treated is 14% and declining at a rate of 1% manganese every two
years. ((3) )EMM world demand is forecast to steadily rise from
over 1,532,000 tonnes in 2011 to almost 2,839,000 tonnes in 2021(an
average increase of nearly 131,000 tpa) with the price predicted to
increase from $1.53/lb to $2.30/lb over the same period((2)).
Mineralogical examination and sulphuric acid leach tests have shown
that the manganese contained in the Plymouth deposit 2011 drill
core composite sample occurs primarily as manganese carbonate.
There are currently a number of factors affecting the Chinese EMM
industry that highlight an opportunity for the launch of foreign
EMM production outside of China. These include diminishing tonnage
and grade of Chinese manganese carbonate deposits, high electricity
costs ($0.08/kwh) and erratic supply, high average mining costs
($86/t ore average) due to narrow vein underground ore sources and
open pit ore sources with high stripping ratios and
increasing environmental standards that are unattainable by the
vast majority of small processors in China. The Shanghai Metals
Market identify in their "China Manganese Industry Chain Analysis
Annual Report for 2010" that they believe production of Chinese
carbonate ores will face increased restrictions of production for
the reasons identified above. References: (1) Historic resource
estimates from an article written by K.O.J. Sidwell, 1957: The
Woodstock, N.B., Iron-Manganese Deposits. Transactions of the
Canadian Institute of Mining and Metallurgy, volume LX, 1957, pages
231-236. The article reports; the Plymouth resource estimate was
compiled from data acquired from a total of 17,388 feet (5,300
metres) of drilling; the North Hartford resource estimate was
compiled from data acquired from a total of 13 drill holes totaling
5,381 feet (1,640 metres) of drilling as well as gravimetric
geophysical data, and; the South Hartford resource estimate was
compiled from data acquired from a total of 9 drill holes (footage
undisclosed) as well as gravimetric geophysical data. (2) Manganese
Market Outlook, February 2012, CPM Group, New York, USA. (3) China
Manganese Industry Chain Analysis for 2010 and for 2011-2012,
Shanghai Metals Market. Qualified Persons and Quality Assurance and
Quality Control: J. Dean Thibault, P. Eng., Senior Process Chemical
Engineer and Principal of Thibault & Associates Inc., of
Fredericton, New Brunswick, is acting as a Qualified Person in
compliance with National Instrument 43-101, with respect to the
metallurgical bench scale test program information contained in
this release and has reviewed the contents for accuracy. Paul
Moore, MSc, PGeo (NL), Vice-President Exploration for Buchans
Minerals Corporation, is acting as a Qualified Person in compliance
with National Instrument 43-101 with respect to the geological
technical information contained in this release and has reviewed
and approved the contents for accuracy. Much of the geological
information contained herein is, however, historical in nature and
relies entirely on data provided by other sources which have not
and cannot be independently verified at this time. As such, the
historical resource data discussed herein should not be relied
upon, but are presented as an indication of the exploration
potential of the mineralization described. About Buchans Minerals
Buchans Minerals is an Atlantic Canada based resource company that
has three main assets that include its base metal properties near
Buchans in Central Newfoundland, its manganese property located
near Woodstock in New Brunswick and its 50% owned gold & copper
Long Range Property in central Newfoundland. Forward Looking
Statements Information set forth in this news release may involve
forward-looking statements under applicable securities laws.
Forward-looking statements are statements that relate to future,
not past, events. In this context, forward-looking statements often
address expected future business and financial performance, and
often contain words such as "anticipate", "believe", "plan",
"estimate", "expect", and "intend", statements that an action or
event "may", "might", "could", "should", or "will" be taken or
occur, or other similar expressions. All statements, other than
statements of historical fact, included herein including, without
limitation, statements about the potential of the Woodstock
project, are forward-looking statements. In addition, all
statements in this news release that address estimated resource
quantities, grades and contained metals, possible future mining,
and exploration and development activities are forward-looking
statements. By their nature, forward-looking statements involve
known and unknown risks, uncertainties and other factors which may
cause our actual results, performance or achievements, or other
future events, to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the
following risks: the need for additional financing; operational
risks associated with mineral exploration; fluctuations in
commodity prices; title matters; environmental liability claims and
insurance; reliance on key personnel; the potential for conflicts
of interest among certain officers, directors or promoters with
certain other projects; the absence of dividends; competition;
dilution; the volatility of our common share price and volume and
the additional risks identified the management discussion and
analysis section of our interim and most recent annual financial
statement or other reports and filings with the TSX Venture
Exchange (the "Exchange") and applicable Canadian securities
regulations. Forward-looking statements are made based on
management's beliefs, estimates and opinions on the date that
statements are made and Buchans Minerals undertakes no obligation
to update forward-looking statements if these beliefs, estimates
and opinions or other circumstances should change, except as
required by applicable securities laws. Investors are cautioned
against attributing undue certainty to forward-looking statements.
Neither the Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the Exchange) accepts
responsibility for the adequacy or accuracy of this release, and no
securities regulatory authority has either approved or disapproved
of the contents of this release. BUCHANS MINERALS CORP.
CONTACT: Buchans Minerals Corporation.Warren MacLeod, President
& CEOPh: (902) 472-3520Windsor, Nova
Scotiawww.buchansminerals.com
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