Exploration at the Niobec mine is concentrated only within the carbonatite complex, as this is the only known occurrence of niobium. Exploration is focused at depth to extend the known mineralisation and mine life.
During 2009, niobium proven and probable mineral reserves at the Niobec Mine have increased by 32% to 181.3 million kilograms of contained Nb2O5. This increase is a result of infill drilling that allowed the conversion of inferred to indicated mineral resources in blocks 5 and 6. The Company also increased inferred mineral resources by 53.6 million kilograms of contained Nb2O5 as a result of drilling below the 6th level.
Future drilling will continue to focus on infill drilling of mining areas on the lower blocks to convert resources into reserves and will also begin to explore extensions to the orebody primarily at depth.
On June 20, 2011 the Company announced that it had filed an independently prepared NI 43-101 compliant preliminary economic assessment ("PEA") on the Niobec mine. The PEA reflects potential for a near 700% increase in measured and indicated mineral resources to over 1.9 billion kilograms of contained niobium pentoxide, and a potential threefold increase in niobium production to a level of 15 million kilograms per year.
In the third quarter of 2011, the Company continued executing on its strategic initiative to unlock the value of Niobec. This included establishing a framework of financing alternatives to fund expansion without reliance on cash flow from the gold business, which may include the sale of a minority interest to a strategic investor. Towards this end, discussions with potential private investors continued throughout the quarter and specific due diligence work was conducted. While discussions have been constructive despite the market volatility, the Company is committed to executing a deal that reflects the fair value of Niobec.