Transcription of Finance News Network Interview with TUC Resources Limited (ASX:TUC) Managing Director, Ian Bamborough
Clive Tompkins: Hello Clive Tompkins reporting for the Finance News Network. Joining me at the Australian Uranium and Rare Earths Conference in Fremantle, Western Australia is TUC Resources Limited (ASX:TUC) Managing Director, Ian Bamborough. Ian welcome to FNN. Can you start by introducing TUC Resources?
Ian Bamborough: Yeah Clive, the TUC Resources was formed about four and a half years ago from a totally greenfields lump package in the Northern Territory. We currently hold about 18,000 square kilometres of licenses in the NT, which makes us maybe fourth or fifth largest landholder up there. And the current focus of the Company is very much on heavy rare earth exploration and discovery.
Clive Tompkins: Good thanks. So where are your projects and what do they contain?
Ian Bamborough: Our main project is about four and a half hour’s drive south of Darwin, not too far off the main road and it’s a heavy rare earth discovery made, probably about a year/year and a half ago. A little bit different in that I specifically said heavy rare earths as opposed to the light rare earths. And particularly in the minerals dysprosium, yttrium, terbium, which are all on the critical element list and highly sought after. Those minerals are used for example in making high-power fixed magnetics in hybrid cars or light bulbs – yttrium phosphors in low-energy light bulbs, if you want both growth markets driven by government incentives for clean energy.
Clive Tompkins: Ian, now to your Stromberg heavy rare earth project. What stage is it?
Ian Bamborough: It’s early exploration stage. We’ve now done two phases of drilling and both drilling phases are very consistent. However, at the same time, we have taken an early lead in our mineralogical and metallurgical assessment. And with rare earths mineralogy and metallurgy is the main driver for success. So we’ve had some early success with some of the minerals we’ve discovered there, they’re quite unique. And I think that is what is going to be one of the things that help us bring this program along quite quickly.
Clive Tompkins: Good, so what does it contain?
Ian Bamborough: The key mineral is a mineral called xenotime which is an yttrium phosphate, and yttrium being one of the, if you want, main rare earth minerals or main payable minerals. And that mineral is also very good at scavenging the heavy rare earths, such as disposing ore terbium. And again those are the key elements that are driving a lot of these clean energy technologies. Little bit unique in that it rarely exists outside China, who control most of the market at the moment and we are very excited to have found something so rare. You probably have to go a long way to find something like what I think we’ve discovered.
Clive Tompkins: And Ian, what is the process of extraction and where would that processing occur?
Ian Bamborough: Yeah, there’s two phases of mineralogy on minerals in the deposit we have. What’s a little bit unique about the proposed extraction process - and we have conceptual flow sheets in process at the moment to really try and prove this concept, is that we can leach the heavy rare earths straight out of the naturally occurring material, or unbeneficiated ore and obtain very high recoveries. And at the moment we are testing, mainly testing a direct sort of sulphuric acid leach. Initial test work has shown recoveries from 77 to 87 per cent, which is very high.
And the kind of special thing about this leach process, if you like, is providing test work continues to show this, that we should be able to precipitate that to what’s called a rare earth intermediate, or rare earth carbonate product. And those products can obtain a higher price than perhaps a mineral concentrate xenotime. Not the full heavy rare earth oxide prices, but at the same time because we’re not building a processing plant to extract the full sort of heavy rare earth potential, it gives us an opportunity to sell our carbonate without perhaps spending a tremendous amount of dollars on capex. And that also means that we could be a project that is up and running much quicker than, you know, all the projects that have just made a recent discovery. So that’s the structure the Company is trying to follow.
Clive Tompkins: Good thanks. So what’s the next key milestone for Stromberg?
Ian Bamborough: I’ve got four key milestones; I’ll perhaps talk about all of them. This year we want to drill the project towards an initial result. At the same time I’m balancing that with showing what I believe is the true exploration upside potential around the deposit. So we’ll shortly be announcing and quarterly report the results of our latest round of geochemistry, which has identified a new prospect we call Scaramanga - that will be a drill target for this year. As well as drilling Stromberg towards results, we’ll be drilling new targets like Scaramanga. The process flow sheet itself – try and improve the concept this year and perhaps even produce a nice sample of mixed rare earth carbonate to give to potential off take partners.
Another key milestone that I’m working on personally is we have some excellent ground with some huge potential on it, currently in discussions with the traditional owners. And I believe they’re progressing very well and I think that will unlock a tremendous amount of potential for the Company and for shareholders. And fourthly, we also have a strategy of trying to align ourselves with key industry, rare earth industry players who can most importantly, I think, bring a marketing strength for any potential product we have, but secondly also - technical and processing expertise.
Clive Tompkins: Now to your financials. What’s your cash position and are you funded for the rest of the year?
Ian Bamborough: Yeah current cash position is, I guess at the last quarterly, $2.9 million and we run very tightly and vey streamlined. And the next quarterly cash position which is out soon, won’t be too much further below that. One of the huge advantages we have is that so far the mineralisation at Stromberg hasn’t been discovered below about 18 metres vertically, and that means we can drill a lot of holes without using a lot of dollars.
Clive Tompkins: Last question Ian. What’s the priority for the second half of the year?
Ian Bamborough: Number one priority second half right now is the drilling, the commencement of drilling around kind of early to mid-August and continuing the mineral processing work. And I guess thirdly, continuing with the traditional owner negotiations or discussions and development of our key stakeholder relationships. And I hope we can deliver some good news this year.
Clive Tompkins: Ian Bamborough, thanks for the introduction.
Ian Bamborough: Thank you very much, thanks Clive.