Hudson Resources (CVE:HUD)(OTCQX:HUDRF) said Tuesday that it has begun its 2011 drill program at its Sarfartoq rare earth element project in Greenland, which will be designed to upgrade the resource at the site.
"We expect that this drill program will allow us to upgrade and expand our flagship ST1 Zone from inferred to indicated resources which is a prerequisite to initiating a pre-feasibility study later this year," said president James Tuer.
The 10,000 metre 2011 program has already started with one drill rig operating, and another expected to come online in two weeks. At least 5,000 metres will be completed on the ST1 Zone, with the remainder to focus on testing additional targets at the property.
Results are expected throughout the summer, the company said.
Rare earths refer to a group of 15 specific elements, known as lanthanides, used for everything from smartphones to guided missiles.
While some rare earths are relatively common, they are dispersed in a way that makes it difficult to find deposits with high enough ore grades to economically exploit, placing them in high demand, especially as China, the largest supplier of the metals, cuts export quotas.
Currently, Hudson has defined an initial NI 43-101 resource estimate for the ST1 Zone, which stands at 14.1 million inferred tonnes, averaging 1.51% total rare earth oxides (TREO). The resource contains over 40 million kilograms of neodymium oxide, which is the key component in permanent magnets and said to be the fastest growth sector of the rare earths industry.
Prior to beginning a feasibility study at the Sarfartoq project, the company is expected to complete a preliminary economic assessment by the third quarter.