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VANADIUM UPDATE Largo Resources plans production at Brazil vanadium deposit Largo Resources Ltd. [LGO-TSXV] is developing its advanced-stage Maracas vanadium-platinum group metals project in Bahia, Brazil. An independent feasibility study was completed in September 2008. The property hosts a NI 43-101 compliant measured and indicated resource of 22.5 million tonnes grading 1.26% V2O5 and 13.1 million tonnes grading 1.34% V2O5 of NI 43-101 proven and probable reserves. The feasibility study calls for an estimated payback of 1.9 years and after-tax cash flows of $1.329 billion over a 23-year production plan. The IRR is 43.9% and the NPV is $489 million (at a 10% discount). Largo has an off-take agreement with Glencore International. Initial production is scheduled for Q1 2011 at an average annual production of 10 million lbs. FeV. For the first eight years of production, mill feed should average 1.94% V2O5. Only 10% of the potential eight kilometres of strike length has been explored and targets have been identified for drilling. Largo recently acquired the Campo Alegre de Lourdes vanadium-titanium-iron project, also in Bahia, Brazil. The property hosts a historical resource of 132 million tonnes grading 0.75% V2O5 and includes 50% iron and 21% TiO2. The deposit is open along strike and to depth. Largo Resources is also exploring its 100%-optioned Northern Dancer tungsten-molybdenum project that straddles the Yukon-British Columbia border – see Resource World, September 2009.

American Creek testing Ironmist property for vanadium and iron American Creek Resources Ltd. [AMKTSXV] is following up on encouraging exploration results from its 100%-owned Ironmist Project located 60 kilometres north of Kamloops, British Columbia. Work in 2008 included soil sampling and geo44

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physics that identified three magnetic-high anomalies. This led to the discovery of several iron/vanadium targets where sampling returned assays of 43.5% iron and 0.40% V2O5 as well as 34.2% iron and 0.34% V2O5. The mineralized zone is classified as an iron skarn, a type of mineral deposit where metal values replace limestone. The company is planning a three or fourhole drill program to start shortly designed to test for grade consistency and depth of the iron/vanadium mineralization and possible extensions of the known mineralized zone. The project is situated three kilometres from the town of Barriere and features highway access, nearby railways and power. Apella Resources exploring three Québec vanadium prospects Apella Resources Inc. [APA-TSXV] has completed a Phase I exploration program on its 100%-owned Lac Dore North vanadiumiron-titanium prospect located 70 kilometres southeast of Chibougamau, Québec. The program included 10 diamond drill holes from which 255 samples are currently at ALS Chemex in Perth, Australia for assaying. The drill program had followed an extensive and successful trench sampling program undertaken in winter 2008-09 which resulted in encouraging vanadium-iron-titanium assays. Apella’s 100%-owned Lac Dore North vanadium project covers the northeast extension of the Lac Dore deposit over a strike length of 2.6 kilometres. Channel sampling at Lac Dore North returned vanadium values ranging from 0.5% to 0.610%, which, after conversion to V2O5, equates to 0.089%1.089% vanadium pentoxide, averaging 0.55%. Titanium values (TiO2) averaged 6.40% and iron values averaged 32.81%. On claims adjoining Apella’s Lac Dore North Project lies the Lac Dore deposit containing an inferred mineable vanadium pentoxide resource of about 5.5 billion pounds (non NI 43-101 compliant) making it the largest in North America and second largest in the world. In a July 2009 Québec

A diamond driller pulls up another core barrel at Apella’s vanadium-iron-titanium prospect located 70 kilometres southeast of Chibougamau, Québec. Photo courtesy Apella Resources Inc.

government preliminary decision, Apella was awarded nine mineral claims which provide Apella with a controlling interest in the Lac Dore deposit. Apella’s competitor, the Québec Government, was awarded two claims, with 10 remaining un-awarded to date, most of which do not cover any of the deposit. The Lac Dore deposit was identified in 1954, and the vanadium content was discovered by the Québec government in1966. The deposit remained a government of Quebec Crown asset for more than 40 years. Both the Lac Dore North Project and adjoining Lac Dore deposit are road accessible and only 35 kilometres from power. Apella also holds a 100% interest in the Iron-T, Québec’s third significant vanadium-iron-titanium project. The Iron-T encompasses 10,600 contiguous acres in the layered intrusive of the Bell River Complex at Matagami. Most of the world’s significant vanadium deposits are situated in layered intrusive such as the Lac Dore Complex in Québec, Bushveld Complex in South Africa, Panzhihua in China, and the Windimurra Complex in Australia. Apella carried out extensive channel sampling in fall 2008 which yielded significant vanaOctober 2009


dium-iron-titanium results mirroring those of the Lac Dore deposit and adjoining Lac Dore North Project. Mineralization at the Iron-T Project promises to be extensive, covering a strike of over 10 kilometres. Iron-T mineralization has similarities to such world class deposits as the Rhovan deposit in South Africa. Apella filed a NI 43-101 compliant report on the Iron-T in January 2009. Channel sampling resulted in economic results being released that averaged 0.502% V2O5, 32.42% Fe, and 8.28% TiO2. All three of Apella’s vanadium projects are open along strike and at depth. A 10-hole diamond drilling was recently completed at Lac Dore North. Assays are pending and more drilling is planned with a view to extending the known mineralized zone. Geophysical surveys have also been completed. Further stripping and channel sampling is also planned. Ground geophysics and diamond drilling are planned for fall 2009 on the Iron-T Project with a $1.25 million budget proposed. n

October 2009

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Vanadium Article in Resources World