SIERRA BLANCA, TX--(Marketwired - December 19, 2016) - Texas Mineral Resources Corp. (OTCQX: TMRC)
- U.S. Department of Energy research data indicates potentially significant amounts of scandium and rare earth byproducts in coal properties
- Preliminary internal economic analysis of a coal-associated rare earth project suggests potential significant profitability coupled with potentially low capital requirements
- TMRC led a team which recently submitted a proposal for a $23.75 million Department of Energy funding opportunity utilizing coal material from Jeddo properties
Texas Mineral Resources Corp. (TMRC), an exploration company targeting the heavy rare earths and a variety of other high-value elements and industrial minerals, is pleased to announce that it has signed an extension to the memorandum of understanding (MOU) executed in July 2016 with Pagnotti Enterprises, parent of Jeddo Coal Company. Jeddo Coal Company and its affiliates have been in the anthracite mining business for over 80 years and Jeddo remains a major producer of anthracite coal with active mining and preparation operations at the Jeddo Basin near Hazelton, Pennsylvania. The purpose of the MOU and this extension, is to evaluate the potential to recover and produce scandium and other rare earth byproducts from sedimentary rocks associated with the coal deposits.
The National Energy Technology Laboratory of the United States Department of Energy (DOE) has been conducting studies of technology metals associated with Appalachian coal deposits. This study has included extensive sampling of various coal properties. In 2015 the DOE researchers collected 135 samples from Jeddo Coal Co. properties, principally from drill core. The average technology metals content of these samples was 407 ppm total rare earth and 102 ppm scandium. Other work being carried out at Penn State University indicates that these metals can be effectively recovered by leaching the whole rock with ammonium sulfate. Assuming the applicability of these leaching techniques, and the very favorable prices for scandium, TMRC executed an MOU with Pagnotti Enterprises Inc. to jointly develop these technology metals associated with the coal beds. In September, 2016 the Office of Fossil Energy of the U.S. Department of Energy issued a $23.75 million Financial Assistance Funding Opportunity Announcement titled: Production of Salable Rare Earth Elements from Domestic U.S. Coal and Coal By-Products. TMRC, its processing partners Inventure Renewables/K Technologies and Penn State University have jointly submitted an application for this grant.
Preliminary internal analysis done by TMRC, assuming a processing rate at a modest 250 tons per day of sand and siltstones associated with the coal containing an estimated 100 ppm (parts per million) scandium content, would result in an operation with an estimated capex of approximately $24 million, inclusive of a 25% contingency. Potential estimated production of scandium oxide would be approximately 13,000 kg annually. At a 250 tonnes per day production rate and using a current scandium market price of $2,000/kg such an operation would potentially result in an annual pre-tax cash flow of approximately $17 million, after royalty payments to the coal company. This analysis assumes that only the scandium recovered would be sold, attributing no value to other elements and minerals that could be recovered. "The use of scandium in making high strength aluminum alloy is well understood and documented. The only limits to its wide acceptance in the aircraft industry and for its use in military vehicles is its limited supply," said TMRC CEO Dan Gorski.
"A significant portion of the feasibility work we will undertake to explore the potential of the coal deposits will be equally applicable to feasibility work required at our Round Top deposit in southwestern Texas," Gorski added. "We will do all we can to leverage these synergies as we move forward."
Anthony Marchese, Chairman, further commented: "We believe joining forces with a well- established Pennsylvania coal company such as Jeddo in the recovery of scandium and other valuable rare earth minerals is a perfect complement to our Round Top heavy rare earth project in Texas. The potential benefits of such a project will be felt in the surrounding coal community in Pennsylvania as well as by TMRC shareholders. Along with the Department of Energy, we strongly believe there is enormous potential to recover rare earth minerals from coal deposits in the northeastern United States."
About Texas Mineral Resources Corp.
Texas Mineral Resources Corp.'s primary focus is exploring and, if warranted, developing its Round Top heavy rare earth and industrial minerals project located in Hudspeth County, Texas, 85 miles east of El Paso. The Company's common stock trades on the OTCQX U.S. tier under the symbol "TMRC."
This press release contains forward-looking statements within the meaning of the U.S. Securities Act of 1933, as amended, and U.S. Securities Exchange Act of 1934, as amended, including, but not limited to, statements recovery rates of scandium from coal material leach solution being indicative of production potential, potential development and production of scandium in Pennsylvania, potential production rates and mining costs, potential revenue streams from such production, anticipated production methods and results, anticipated mine life in Pennsylvania, potential production of scandium de-risking project economics, Pennsylvania coal deposits being a stable, long-term supply of scandium, projected increased demand in the scandium market and other similar statements. When used in this press release, the words "potential," "indicate," "expect," "intend," "hopes," "believe," "may," "will," "if, "anticipate," and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such statements. Such factors include, among others, risks related to the development of the Round Top project, up-scaling of extraction testing, risks related to changes in future operating costs and working capital balance, risks related to mining results not matching preliminary tests and risks related to the ability of TRER to raise adequate working capital and continue as a going concern, as well as those factors discussed under the heading "Risk Factors" in the Company's latest annual report on Form 10-K, as filed on December 14, 2016, and other documents filed with the U.S. Securities and Exchange Commission. Except as required by law, the Company assumes no obligation to publicly update any forward-looking statements.