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Peak Resources Appoints ANSTO To Construct And Operate Pilot Plant

Peak Resources (ASX: PEK; OTCQX: PKRLY) has taken another step towards achieving production from the wholly owned Ngualla Rare Earth Project in Tanzania in early 2016.

Peak has now appointed the leading Australian mineral process development facility, ANSTO Minerals (ANSTO), to construct and operate a solvent extraction (SX) pilot plant.

ANSTO developed the process recoveries and pilot plants for the Mt Weld deposit in Western Australia, and the Nolans deposit in the Northern Territory.

The plant will take the mixed rare earth product from the simple acid leach process and produce four refined, high purity, higher value rare earth oxide products.

The Ngualla deposit is a recent discovery with the maiden Mineral Resource of 170 million tonnes at 2.24% REO announced in February 2012, which confirms Ngualla as one of the largest and highest grade rare earth deposits in the world.

Richard Beazley, managing director, commented: "The commencement of the SX pilot plant is a major step toward the company achieving production in early 2016.

"In the two years since discovering the Ngualla deposit and starting well behind the rest of the field of emerging rare earth producers, Peak has fast tracked its development and continues to differentiate itself as a company and project that delivers.

"Peak in the past year has released a maiden Resource Statement in February 2012, demonstrated the 'Proof of Concept' for the metallurgical process in August 2012 and delivered a positive scoping study and preliminary economic assessment in early December 2012.

"The commencement of a SX pilot plant in January 2013 sets Peak up to become one of the select few leading rare earth developers. This is another strong indication of just how robust and unique the Ngualla Rare Earth Project is."

Scoping Study

The scoping study completed in December 2012 focused on a portion of the SREZ - the Bastnaesite Zone. This mineralisation has several fundamental geological aspects that offer distinct advantages for development over other rare earth projects.

It is high grade, occurs at surface, has the lowest uranium - thorium contents of any major rare earth deposit in the world and is readily extracted using a simple sulphuric acid leach process.

The scoping study confirmed Ngualla as a leading rare earth project with an estimated NPV of US$1.57billion and pre-tax IRR of 53% for an initial 25 year mine life and mining of an 8.2 million tonne portion of the Indicated and Measured Mineral Resource within the Bastnaesite Zone with an average grade of 4.35% REO.

A total of 130 holes for 13,600m of reverse circulation and diamond drilling completed in 2012 after the maiden Mineral Resource will allow for the estimation of a large Measured Mineral Resource and provide the definition required for a detailed mine plan and schedule for the project.

This revised Mineral Resource estimate is scheduled for completion by the end of March 2013.

Recent milestones

Significant successive milestones have been met or surpassed since the maiden Mineral Resource in February 2012, including a 'Proof of Concept' for the metallurgical process, a breakthrough in beneficiation testwork, completion of targeted drilling in the high grade Bastnaesite Zone, positive results from the scoping study and preliminary economic assessment, and now the commencement of the SX pilot plant.

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