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Greenland Minerals And Energy MD John Mair Talks With Proactive Investors

Greenland Minerals and Energy (ASX:GGG) is progressing its Kvanefjeld uranium and rare earth project in Greenland through completion of feasibility studies, with the recent completion of engineering design work.

Adding interest, the Siumut Party, which favours resource extraction, has formed a new coalition government following the recent Greenland election.

The feasibility study, which is set for completion in the first quarter of 2015, is evaluating a mine, concentrator and hydrometallurgical refinery in Greenland treating 3 million tonnes of ore per annum.

The concentrator will produce 230,000 tonnes per annum of a rare earth mineral concentrate which contains 14% REO and 0.25% U3O8.

Kvanefjeld has Resources of 956 million tonnes, containing 575 million pounds uranium and 10.33Mt total rare earth oxide.

PROACTIVE INVESTORS: Welcome John.

What impact does GGG expect to see from the Siumut Party continuing to lead the coalition government in Greenland given its support for the resources industry?

JOHN MAIR: The recent election put a lot of focus on what Greenland needs to secure foreign investment, in order to see mining projects successfully developed.

The Siumut Party is committed to providing a stable government, with consistent rules and regulations with the aim of developing priority projects.

All coalition parties are of a pro-uranium position, and we anticipate that the government will be proactive in quickly moving to continue the work with Denmark on uranium regulation.

In 2014, considerable progress was made on this front, however, work on regulatory matters was placed on hold during the lead up to the election.

With a pro-uranium coalition government in place, we anticipate continued progress as both parties look to finalise a cooperation agreement on the regulation of uranium production and export from Greenland.

With Tetra Tech having completed the engineering design work for Kvanefjeld, what other work remains to be done to complete the feasibility study?

JOHN MAIR: There are a number of other components that collectively form the feasibility study, and these include the port study, shipping logistics study tailings storage facility study, in addition to the mining and processing studies. Most of these are now complete.

The mineral resource estimate is currently being updated by SRK, and should be finalised in January. This is primarily aiming to define measured category mineral resources, as a basis for establishing a new mine schedule, which is another important aspect of the Feasibility Study.

The new mineral resource estimate, along with the feasibility study, will allow us to generate a mining reserve for the Kvanefjeld project, which should be available in early to mid Q2 2015.

In summary, most study components are complete, and we are now in the drafting phase to close out the feasibility study. This should be finalised in Q1.

Is China Nonā€Ferrous Metal Industry's Foreign Engineering and Construction (NFC) still on track to deliver a final feasibility level cost estimate?

JOHN MAIR: NFC is conducting the cost-estimation process, based on the engineering outputs from Tetra Tech. This is nearing completion, and is another important component of the feasibility study.

The results of a recent assay program for the infill drilling was released in mid-December, and it returned some impressive intercepts. What impact can investors expect to see from this program on the existing Resource at the project?

JOHN MAIR: We were fortunate to gain access to some historic drill cores that had been drilled by Danish research agencies in the 1950's, 60's and 70's.

These were mostly located within the central part of the Kvanefjeld resource, and had never been assayed by chemical methods to determine multi-element chemistry.

We logged, processed and assayed these cores, which serves to provide important infill data to help improve the quality of the resource estimate.

The results were excellent, which was not surprising, with each hole returning multiple mineralised intercepts. It's a great reminder of the strength and continuity of uranium and rare earth mineralisation at Kvanefjeld.

We don't expect a material change in grade or tonnes; the resource update is to establish the first 'measured' category resources, in line with the JORC code.

This will then allow us to develop a new mine schedule and move forward to establish an initial mine reserve.

Since the last resource estimate was completed in early 2011, we have also seen some changes to the JORC code reporting requirements. We will therefore be bringing the overall project resource estimate in line with the JORC-code 2012.

Finally, what are the key catalysts for investors to look out for from GGG in the first six months of 2015?

JOHN MAIR: We start 2015 with a really positive outlook. We have a new government in Greenland that is supportive of industry and working to attract foreign investment, and importantly for us, is of a clear pro-uranium position.

There is life coming back to the uranium sector with the Japanese reactor restart program seemingly moving forward, and substantial new reactor build in China and elsewhere.

The outlook for rare earths continues to clear with China scrapping their export quota system and related taxes, and moving to impose internal taxes on miners, as well as tighten regulations to crack down on illegal production, and enforce higher environmental standards.

These mechanisms could well curtail Chinese rare earth output, and drive up prices to levels that are required for a more sustainable industry.

We have a Feasibility program coming to completion through Q1 then we focus on the permitting timeline in close consultation with Greenland.

The resource update, new mine schedule, and the first mining reserve are all approaching in the near term. It would be ideal to commence the permitting process in Q3, following the completion of the environmental and social impact assessments, and this will represent a major milestone.

We have some large test work operations coming up for the EURARE program which has become hugely beneficial for us, with Kvanefjeld being one of the key points of focus. Under the EURARE program we have a large scale pilot plant operation of the concentrator circuit coming up in April in Finland, and this is followed by pilot plant operation of the hydrometallurgy circuit in August, which will take place in Germany. These programs stand to build on the high level of technical rigour behind Kvanefjeld in a very cost-effective manner.

Meanwhile we continue to build our cooperative working relationship with NFC. Through 2014 we conducted a lot of technical exchange, as well as important visits to Greenland, and Perth. This will continue into 2015 as we finalise the feasibility study, and shift our focus onto more of the commercial framework.

PROACTIVE INVESTORS: Thank-you John.

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