Nechalacho / Thor Lake

Overview

The Nechalacho/Thor Lake rare earth property is located in Canada’s Northwest Territories, 100 km southeast of the capital city of Yellowknife and 5 km north of the Great Slave Lake. 

The mine site area was first mapped by the Geological Survey of Canada (GSC) in 1937 and 1938. First staking activity at Thor Lake dates from July 1970 when claims were staked for uranium. The property changed hands many times until 2005 when Avalon Rare Metals purchased 100% interest subject to royalties.

The rare earth deposit is to be mined through underground methods at rate of 2,000 tonnes per day. A flotation plant is to be erected onsite, while the hydrometallurgical facility would be constructed near Pine Point on the south shore of the Great Slave Lake. Concentrate is to be trucked to Hay River for on-shipment by rail to Geismar, Louisiana, USA at company's heavy rare earth separation plant and refinery. 

A Definitive Feasibility Study is to be completed in Q2 2013.

The mining complex is planned to produce 10,000 t TREO per year starting with late 2016 over a mine life that would span more than 20 years.

Location

The Thor Lake property is located in Canada’s Northwest Territories (NWT), 100 km southeast of the capital city of Yellowknife and five kilometres north of the Hearne Channel on the East Arm of Great Slave Lake.

The Nechalacho property consists of five contiguous mineral leases 4,249 ha) and three claims (1,869 ha). The property is part of the Mackenzie Mining District.

Yellowknife (population 20,000) and Hay River (population 3,500) have very good supporting infrastructure and are two important transportation hubs. An airstrip was constructed at the site in 2010 and it wou;d be extended to accommodate larger aircraft for 2013.

The mine site area is characterized by subdued topography (230m to 255m above sea level). One third of the property is covered by lakes and swamps - e.g. Thor Lake. Vegetation is typical boreal forest of the Canadian Shield with stunted trees and clearings.

Temperatures range from from -50°C in the winter to +30°C in the summer. Historically, the average annual snowfall is 152 cm for the region.

Geology & Mineralization

Thor Lake mineral deposits occur within the Aphebian Blatchford Lake Complex (BLC), which includes Achaean Yellowknife Supergroup metasedimentary rocks of the southern Slave geologic province. BLC rocks have an alkaline character.

The Nechalacho nepheline sodalite syenite consists of a layered series of rocks with increasing peralkaline characteristics at depth. Genetically Nechalacho is the result of a process of igneous differentiation in a closed system with rare earth elements concentration within a residual magma.

Mineralization occurs as sub-horizontal layers of ore minerals with varying thicknesses. Mineralization includes Light Rare Earth Elements (LREE) found principally in allanite, monazite, bastnaesite and synchysite; yttrium, HREE and tantalum found in fergusonite; niobium in ferro-columbite; HREE and zirconium in zircon; and gallium in biotite, chlorite and feldspar in albitized feldspathic rocks.

Nechalacho mineral deposit is approximately triangular in shape and covers a drilled area of about 2.9 square kilometers. It's mineralized zones are up to 200 m thick. It is divided in a lower grade Upper Zone, and a richer REE Lower Zone.

In 2011, proven mineral reserves stood at 14.5 Mt grading 1.53% Total Rare Earth Oxides (TREO). As of July 2012, measured mineral resources were estimated at 8.90 million tonnes grading 1.64% TREO and 21.7% HREO/TREO using the base case $260/tonne Net Metallurgical Return.

As of August 30, 2012, 474 holes have been drilled for a total of 91,318 meters.

Mining & Operations

The majority of the rare earth resource lies under the nearby Thor Lake at a depth of 180m. The deposit would be accessed through a ramp collared to the west of Long Lake. Mining methods of choice are drift and fill combined with long hole stoping. Grade control will be achieved with a combination of visual analysis and a handheld analyzer.

The mining will be done with rubber tired mechanized equipment. Broken ore will be hauled to the underground crusher that consist of primary, secondary and tertiary crushing and screening. The ore the ore will be then transported to the mill on surface by a conveyor system.

Underground equipment would consist of 6 m3 LHD (6); 2 boom Jumbo (4); Bolting Jumbo (2); 30t-40t Haul trucks (3); Long hole drill (1); Scissor lift (3); Utility truck (3); ANFO loader (2); Man carrier (2); Mechanic’s Vehicle (2); Service truck (1); Crusher/Conveyor Service (2); Light vehicles (6); Tractor/Backhoe (1); Bobcat (1); Tool handler (1); Portable Compressors (3).

Process 

A flotation plant is to be erected onsite, while the hydrometallurgical facility would be constructed near Pine Point on the south shore of the Great Slave Lake. Concentrate is to be trucked to Hay River for on-shipment by rail to Geismar, Louisiana, USA at company's heavy rare earth separation plant and refinery.

The mining complex is planned to produce 10,000 t TREO per year starting with late 2016 over a mine life that would span more than 20 years.

Nechalacho process equipment include: an Underground crusher, Rod mill, Ball mill, Conditioning tanks, Magnetic separation circuit, Regrind mill, Thickener, Flotation cells (6), Gravity Separator (6),  Concentrate thickener & filter, Hydrometallurgical circuit

Electrical power will be generated at a diesel power station located at the site.

Environment & Community

Avalon is committed to being an environmentally and socially responsible corporate citizen in how it conducts its exploration and development activities. In particular Avalon is applying e3 Plus: A Framework for Responsible Exploration Principles and Guidance established by the Prospectors and Developers Association of Canada (PDAC).

In June 2012, the company announced that it has entered into an accommodation agreement with the Deninu K'ue First Nation.