Published On: May 7th, 2024
Figure 1: Vital Metals Limited
Vital Metals Limited (ASX: VML) (Vital Metals or the Company) has announced results for the quarter ending March 2024. During the quarter, Vital Metals significantly progressed in its Rare Earth Elements (REEs) mining projects. The Company’s flagship REE project is the Nechalacho Project in Canada. The Tardiff Deposit of the Nechalacho REE Project Northwest Territories (NWT) in Canada is estimated to contain more than 623,000 tonnes of neodymium oxide + praseodymium oxides (NdPr). Neodymium and praseodymium are essential components in high-power magnets, while dysprosium, samarium, and terbium are utilised in magnets designed for high-temperature environments.
Vital Metals Limited is emerging as a critical player in the REE industry in North America as a result of the NdPr grade and massive increase in resources at its Tardiff Deposit.
Figure 2: Demand Forecast Rare-Earth By Uses (Source: REIA, Argus Metals)
Figure 3: Demand Forecast Rare-Earth By Elements Value (Source: REIA, Argus Metals)
The demand forecast in Figure 2 highlights from increase in use from ~200 kt in 2023 to ~300 kt in 2033. Most demand is projected here to manifest from increases in magnet use with most of the world’s rare element mark value stemming from a subset in rare earth elements (e.g., Nd, Sm, Pr, Dy, Tb) that in 2022 were projected at ~96% of total value and are forecasted to further dominate and concentrate total market value over the next 10 or so years to reach 99% by 2033 (see Figure 3).
Vital Metals Limited understands the market demand and supply gap situation better. The Company is pushing its Tardiff Deposit of Nechalacho Rare Earths Elements Project to utilise the opportunity.
Nechalacho Rare Earth Elements Project
Figure 4: Nechalacho Rare Earth Elements Project Location
Vital Metals holds a 100% interest in the Nechalacho REEs Project, which covers more than 5,000 hectares. The Company focuses on developing the Nechalacho project that is principally highlighted by the Tardiff deposit into a large-scale rare earth project. Tardiff is special amongst on the class of larger rare earth deposits by having a high ratio of Nd+Pr to TREO of ~25% (see Figure 6).
Figure 5: Nechalacho Project
Updated Tardiff Mineral Resource Estimate
Figure 6: Mineral Resource Estimate (MRE) Summary At The Tardiff Upper Zone
In April 2024, Vital Metals announced an updated Mineral Resource Estimate for the Tardiff Upper Zone Deposit at the Nechalacho project.
- The new estimate employs an integrated approach, using a net metal revenue (NMR) cut-off based on projected cost and recovery factors instead of the previously simplified TREO cut-off criteria
- The updated base estimate, derived from first principles cost and metal recovery factors, yielded an NMR of CAD 115 per tonne and is reported within an optimised pit shell
- It includes a total resource tonnage of 212.7 Mt grading 1.17% TREO, containing 2.48 Mt TREO, and over 623,000 tonnes of NdPr
The MRE update includes drilling data until the end of 2022. Another update with post-2022 drilling data is planned for later in 2024.
Key Findings from the Latest Drill Results at the Tardiff Deposit
- Drill data highlighted the system’s differentiated grade potential, with grades of or above 3.0% TREO at multiple locations on the 2023 drill grid.
- Shallow higher-grade mineralisation, mainly starting <40m depth, is hosted within biotite-altered syenite and altered K-feldspar syenite.
- Multiple areas open in different directions for additional step out drilling to expand on areas of higher than average grade.
- Hole 631 stands out with a remarkable intersection, boasting a grade of up to 7.95% TREO.
Drill Results Summary
- Northwest Area: L23-631: 18.90m at 2.48% TREO from 12.10m, Incl. 1.90m at 7.95% TREO from 12.40m
- Southern Area: L23-661: 12.90m at 2.35% TREO from 56.05m, Incl. 3.65m at 3.82% TREO from 61.35m
- Eastern Area: L23-680: 43.50m at 1.82% TREO from 38.50m, Incl. 1.80m at 3.84% TREO from 69.20m
Nest results are to be furnished include the remaining 24 drill holes in Vital’s 2023 drilling are expected in the next month or so.
As the Company continues to refine its understanding of the truly immense scale of the system and the grade potential of its Tardiff deposit future drilling initiatives remain pivotal in driving value creation and de-risking project advancement strategies.
On the Rare Earth Market perspective, neodymium and praseodymium oxides have shown some semblance of a bounce in price over the last month or so whereby prices surged from USD ~50,000 per tonne to USD 56,780 per tonne, or ~ 13% (Figure 7).
Figure 7: One Month Neodymium and Praseodymium Oxide Price Chart (Source: www.metal.com)
Upcoming Milestones Expectations
- Drill results are expected to be delivered within the next month or so
- An update to the Tardiff mineral resource estimate is expected in the December quarter of 2024
- The Tardiff Scoping Study on feasibility and preliminary economics of mining operations at the Tardiff site is scheduled for release in the December quarter of 2024
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