Navigator Resources Limited (ASX: NAV) has established itself as a mid-tier Western Australian gold producer following the commencement of gold production at its flagship 100%-owned Bronzewing operations in April 2010.
Navigator Resources' Cummins Range Rare Earths project valued at A$20-30m
Navigator Resources (ASX: NAV) has received a revised independent valuation report for its fully owned Cummins Range Rare Earth project that reflects higher commodity prices and estimates the projects value to be in the range of A$20 million to A$30 million.
Cummins Range is located 130km southwest of Halls Creek in the East Kimberley region of Western Australia and is one of very few Australian advanced REO deposits for which a mineral resource has been delineated.
Following the publication of an updated independent resource at Cummins Range and against a global backdrop of increasing rare earth metal importance to the global economy, Navigator sought to have the project independently valued in late 2009.
The report has been completed by John Macdonald of Green Leader Equities Research. The key points in the executive summary include that Cummins Range compares favourably to peer projects carrying market enterprise values of A$24-A$39 million.
At October 2010 prices the Cummins Range resource is estimated to contain $US6 billion in contained value at a 0.5% REO lower cut off grade.
Only a portion of the Cummins Range diatreme has so far been drilled to any depth, and as such there is exploration upside which could significantly increase resources at the project.
In 2007 Navigator completed a reverse circulation (RC) drilling program in the central part of the Cummins Range diatreme leading to an independent JORC compliant Inferred Resource of 71,700 tonnes of rare earth oxides (REO) at a 1.0% REO cut-off grade, as well as uranium oxide and phosphate. Significant niobium and tantalum are also present.
Navigator has thus far drilled 93 holes over an area of approximately 500 metres (north-south) by 400 metres (east-west) and there is excellent potential to expand the REO resource with further exploration.
Drilling stopped in the deposit’s best grades and widths to the north-west. Further drilling is also required to the north and other prospects within the diatreme perimeter are effectively undrilled.
NAV’s focus during 2010 has been on establishing itself as a gold producer with its own cashflow being generated from operations.
The company has nevertheless continued to monitor developments in the rare earth metals sector and is aware of recent market price increases for the suite of commodities existing at Cummins Range.
At the same time, NAV has engaged PCF Capital Group to conduct a staged process to determine whether there is demand for an asset level transaction for the Cummins Range project.
Navigator announced yesterday that a new rare earths company will be created by the company and listed on the ASX, focused on the Cummins Range rare earth oxide deposit.
Rare earth metals are key components in many modern technologies such as TVs, DVDs, MP3 players, x-ray machines, MRI machines and missile guidance. They are also a key part of the earth’s green future, used heavily in both hybrid cars and wind turbines.
