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Peak Resources Produces Over 96% Rare Earth Recoveries In Tanzania

Peak Resources (ASX: PEK, OTCQX: PKRLY) has delivered rare earth leach extraction rates of up to 96.5% in metallurgical testing at its Ngualla Project in Tanzania.

Through a simple and cost effective sulphuric acid leach process, rare earth leach extraction rates averaging 80% were returned from across the central portion of the Southern Rare Earth Zone, which is targeted for first production by early 2016.

Richard Beazley, managing director, commented: "The high recoveries achieved over a wide area support the company's chosen simple sulphuric acid leach process for Ngualla's rare earth mineralisation.

"This means a relatively simple processing plant, lower capital costs and faster start-up."

The 112 new samples add to the 38 samples previously tested, providing a high level of confidence and will allow a solid geometallurgical model to be constructed for project Feasibility Studies due to begin in early 2013.

Samples are representative of a range of rare earth grades of 1.11% to 11% collected across an area of 850 metres by 800 metres and from surface down to 120 metres across the whole Southern Rare Earth Zone.

Peak is in the process of completing a Scoping Study at Ngualla which will include a preliminary economic assessment of the project and is on track for completion before the end of December 2012.

Analysis

Peak has identified and proved a simple sulphuric acid leach processing route to produce a high grade, high purity rare earth concentrate and continues to make rapid progress towards developing Ngualla into a low cost producer.

Today's news of over 96% recoveries using the simple, low cost sulphuric acid leach process is evidence of this.

The new acid leach variability results confirm the efficiency of the chosen sulphuric acid leach processing route on a significant near surface, higher grade portion of the deposit.

This means a relatively simple processing plant, lower capital costs and faster start-up.

The Ngualla Rare Earth Project is a recent discovery hosting a resource of 170 million tonnes at 2.24% REO, ranking the project as the fifth largest rare earth deposit in the world outside of China.

The total resource includes a higher grade, near surface zone of 40 million tonnes at 4.07% REO for 1.6 million tonnes of contained REO.

Ngualla has several fundamental geological aspects that offer distinct advantages for development over other rare earth projects.

These include the large size of the deposit, the outcropping, high grade mineralisation amenable to open cut mining with low strip ratios, favourable mineralogy for processing and the lowest uranium and thorium levels of any major rare earth deposit in the world.

Demonstrating outside interest in the project, Peak has already commenced preliminary discussions with a number of interested parties regarding potential offtake agreements.

The company remains well-funded to advance Ngualla with $8.35 million cash on hand at the end of the September quarter.

One likely catalyst for rerating is the Scoping Study due for release before the end of 2012.

These results will be important for Peak and will demonstrate quite clearly the capacity of the Ngualla Project to deliver on all fronts as an emerging rare earth producer.

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