St George Mining Ltd (ASX:SGQ) is set to take on a high-grade niobium project in the Minas Gerais region of Brazil, which occurs within the same geological setting as a nearby mine run by CBMM (Companhia Brasileira de Metalurgia e Mineração) which produces around 80% of the world’s niobium.
And the market has welcomed the news, with St George shares trading at 4.1 cents at 11:48 AEST, a rise of 20.59% since the market opened.
The project – named Araxá – is also prospective for rare earth elements (REEs), and will be acquired through a binding agreement between St George and Itafos Araxá Mineracao E Fertilizantes S.A, whose issued capital has been acquired by the former, with the transaction to be completed by November 3.
Significant niobium, REE and phosphate mineralisation has been identified by previous explorers at Araxá through drilling work, and this has also pointed out that it lies within the same carbonatite complex as CBMM’s mine.
Historical results included more than 500 intercepts grading above 1% niobium pentoxide (Nb2O5), plus ultra-high grades up to 8% Nb2O5, 33% total rare earth oxides (TREO) and 32% phosphorus pentoxide (P2O5), and mineralisation commencing from surface and open in all directions.
Executive Chairman John Prineas said the project opened the door for St George to become a bigger player when it came to this mineral.
“The Araxá Project is located in the world’s ‘dress circle’ for niobium production and presents a tremendous opportunity for St George to become a global player in the niobium market,” he said.
“Extensive high-grade niobium mineralisation has already been discovered at the Project – with more than 500 intercepts of niobium grades above 1% – providing a strong foundation for St George to quickly progress to potential resource definition.
“In addition to niobium, high-grade rare earths mineralisation has been confirmed by drilling over a widespread area: the high-grade mineralisation commences at surface and is open in all directions, with excellent prospects to substantially expand the known mineralised footprint.
“Significantly, less than 10% of the project area has been effectively drilled and there has been limited drilling beyond 50m from surface.”