Mining Explorers 2009: Bokan Mountain deposit is rare earth

Ucore Uranium Inc., a junior based in Halifax, Nova Scotia, has shifted its primary focus at the Bokan Mountain Granite complex in Southeast Alaska from uranium to rare earth elements.

Ucore changed the name of its U.S. subsidiary from Bokan LLC to Rare Earth One LLC to reflect its evolving focus at the heavy rare earth element-rich prospect on the southern end of Prince of Wales Island about 60 kilometers, or 37 miles, southwest of Ketchikan.

"The property goes well beyond its superficial prospects as a prior high-grade uranium producer, and is a multimetal deposit in every sense," said Ucore President and CEO Jim McKenzie in announcing the name change. "The Rare Earth One trade name is a strong mineral group-specific brand. Its use will delineate Bokan's potential as a significant rare earth element deposit and a prospective source of these increasingly valuable technology metals."

Ucore has been exploring Bokan Mountain since 2007 and in 2008, reported drill results from the I&L zone with indications of potentially significant concentrations of highly valuable heavy REEs. Further, Ucore said it identified several zones with surface sampling that contain even higher REE values outside of the I&L zone and the other main uranium-bearing zones at Bokan Mountain.

The junior said Bokan Mountain is exceptional among North American rare earth deposits for its pronounced enrichment in the heavy rare earth elements.

"Rare earth deposits in North America and around the world almost invariably skew towards the comparatively less valuable light rare earth elements, with the notable exception of select geological areas in China," the strategic metal explorer said.

Dotson Ridge REE Project

Ucore's Bokan Mountain Project covers 30 square kilometers, or 19 square miles, within the Tongass National Forest and includes the former high-grade Ross Adams Mine, Alaska's only prior producing uranium mine.

In August the company split the property into two separate projects. The Ross Adams Mine and surrounding area will continue to be known as the Bokan Mountain Uranium Project. The area north and east of Bokan Mountain is now known as the Dotson Ridge Rare Earth Project.

"Bokan Mountain remains a highly attractive uranium target, being one of the highest grade U3O8 producers ever on U.S. soil, and with uranium mineralization in the Ross Adams uranium mine that remains open at depth. Nonetheless, the Dotson Ridge is recognized as one of only a handful of heavy rare earth element prospects in North America, and needs to be accorded a dedicated focus as the company moves ahead. As a result, the vast majority of our exploration expenditures this year will be dedicated to Dotson Ridge and its superior rare earth potential," McKenzie explained.

Ucore approved a C$2 million exploration program to better understand the REE potential at Dotson Ridge.

Rare Earth One mobilized crews in August to complete geologic mapping, structural interpretations, magnetic surveys, radiometric surveys, and portable X-Ray fluorescence testing to select the best rare earth targets for the 2,000-meter drill program.

Although the presence of rare earths at Dotson Ridge has been known since the 1950's, 2009 will be the first season where rare earths are the prime exploration focus.

REEs to become rarer

Analysts for the U.S Geological Survey, an agency of the U.S. Department of the Interior, anticipate increased long-term growth in demand for heavy REEs, both domestically and worldwide. The agency has issued an opinion on the impact of anticipated shortages of REEs on U.S. domestic high technology production capabilities. The USGS noted that the United States was once self-sufficient in the production of REEs but in recent years, has become more than 90 percent dependent on China for its REE supply.

"The United States is in danger of losing its longstanding leadership in many areas of REE technology. Transfer of expertise in REE processing technology and REE applications from the United States and Europe to Asia has allowed China to develop a major REE industry, eclipsing all other countries in production of both ore and refined products," the USGS said.

The Rare Earths Industry Development Plan 2009-2015, released in August by China's Ministry of Information Technology, says the Chinese government intends to tighten its administration on the production of rare earths over the next six years. Beijing will also restrict the export of rare earths over this period, with the annual export quota for REE's to be contained to below 35,000 tons per year.

Under the new REE plan, the heavy rare earths dysprosium, terbium, thulium, lutetium and yttrium will be fully prohibited from export.

Currently, there is only one REE mining operation in the United States, at Mountain Pass in the Mojave Desert in California near the Nevada border, said Steve Borell, executive director of the Alaska Miners Association. Thus, the potential strategic importance of the Bokan Mountain cannot be overestimated, he said.

USGS recognizes Bokan potential

In 1989, the U.S. Geological Survey first indicated Bokan's potential as a heavy rare earth prospect in a (pre-NI 43-101-and non-43-101-compliant) study of the resource. The scientific agency estimated that the area hosts more than 11 million pounds of uranium as well as tantalum, niobium, and rare earth elements, which ranked Bokan as housing the single largest combined heavy and light rare earth deposit in North America.

The study also identified significant in situ yttrium mineralization at Bokan, estimating one of the largest concentrations of yttrium in North America (non-43-101-compliant). Yttrium is considered to be a proxy for the presence of the entire "Yttrium Group of Lanthanides," otherwise known as the HREEs, and has a strong statistical correlation to the presence of HREEs, according to Ucore. In turn, the high relative concentrations of yttrium at Bokan correlate well to the area's strong prospectivity for the entire suite of HREEs, the junior said.

Since acquiring the Bokan Mountain property in 2007, Ucore has been working to confirm the USGS estimates and is investigating the possibility of an even larger resource, to be explored with modern exploration techniques.

Drill core results from 2008 show REE mineralization, including yttrium, zirconium, beryllium, and niobium, at Bokan Mountain.

Agency funds further studies

In April, the USGS awarded one of four 2009 Mineral Research Grants for the investigation of mineralization at Bokan Mountain. The focus of the studies will be the uranium and rare earth deposits within the Bokan Mountain Granite Complex, and will be conducted by a group of geologists from four Canadian universities, lead by Dr. Jaroslav Dostal of Department of Geology, Saint Mary's University, Halifax, Nova Scotia.

The research at Bokan Mountain is expected to provide a better understanding of the geologic processes that led to deposit formation and to characterize the granite complex that contains the deposits. From this study, analogies to similar deposits around the world will be made and the potential for similar deposits in Alaska and western North America can be assessed, according to the USGS.

"This research project represents a substantial financial commitment on the part of the USGS to the greater understanding the Bokan Mountain complex," said Ucore President and CEO Jim McKenzie. "It will undoubtedly raise international academic awareness of the site, and add greatly to our own understanding of what we have. Ucore will be providing extensive logistic support as the project moves ahead."