Energizer Resources Provides Business Update
Energizer Resources Inc. (TSX.V: EGZ) (OTCBB: ENZR) (FWB: YE5) (“Energizer” or the “Company”) provides an update on its business strategy and initiatives for 2011 in connection with its 100%-owned Green Giant Vanadium Project in Madagascar.
One of World’s Largest Known Vanadium Deposits
The Company’s Green Giant Vanadium Project contains a National Instrument 43-101 compliant (“NI 43-101”) indicated resource of 49.5 million tonnes at an average grade of 0.693% vanadium pentoxide (“V2O5 “) containing 756.3 million pounds of V2O5 and an inferred resource of 9.7 million tonnes at an average grade of 0.632% V2O5 containing 134.5 million pounds of V2O5. With this resource estimate, the Green Giant deposit currently ranks as the third largest known vanadium deposit in the world.
The resource estimate was calculated on the basis on the following:
- Approximately 18,832 metres of diamond drill hole data from the 2008, 2009 and 2010 drill program, supplemented by approximately 5,928 metres of trench data from the 2008, 2009 exploration programs
- All drill core and trench samples were analyzed using an alkaline flux fusion digestion followed by optical emission spectrometry (ICP OES) by Genalysis Laboratory located in Johannesburg, South Africa
- All drill holes are diamond drill core and were sampled mostly at 1.5 metre intervals
- A comprehensive QA/QC program was in place during the drill programs, which included the insertion of standards and duplicates at regular intervals
- Gemcom Software International, GEMS© Version 6.2.4 software was used for the estimate
- Ordinary kriging was used for all domains. The interpolation was carried out in multiple passes with increasing search ellipsoid dimensions. Inverse distance and nearest neighbor models were used for validation
- Classification was based primarily on the pass number and distance to the nearest sample. Metallurgical recoveries are not taken into account.
The Company will continue to consider additional drilling to expand this resource estimate as 75% of the 21-kilometre (18 mile) stratigraphic trend of vanadium remains open for drilling.
Preliminary Economic Assessment to Commence
As a result of favourable in-house economic analyses conducted by AGP Mining Consultants Inc., the independent qualified person for the resource estimate contained in this press release, the Company will be moving forward with a NI 43-101 preliminary economic assessment (“PEA”) in the first quarter of 2011 to confirm and refine the economic parameters for the Green Giant project.
DRA Mineral Projects To Lead Green Giant Project Development
Energizer’s strategic alliance partner, DRA Mineral Projects, a leading engineering, project management and mine construction company based in South Africa will be completing the Company’s upcoming PEA. Having recently completed the pre/feasibility study for Sakoa Coal Project, DRA Mineral Projects will provide valuable insight into the potential infrastructure synergies while assisting the Company in the on-going discussions with Asia Thai Mining.
Strategic Partners To Be Determined
In the first quarter of 2011, the Company will be focusing its efforts on identifying strategic partners in both the steel and battery industries and concluding strategic alliances with these partners. These strategic alliances are expected to provide purchasers for the vanadium to be produced by the Green Giant project.
The Balloch Group, a leading boutique Chinese investment bank, who were retained in November 2010, will assist the Company in identifying potential strategic partners from China.
Increasing Evidence of Vanadium in the Market Place
As indicated in our press releases of November 17 and 30, 2010 there is increasing evidence of leading vanadium-based technologies in the market place. These new technologies require high purity V2O5, which is not readily available. The expected increase in demand for high purity V2O5, coupled with the vanadium demand from the steel industry, is expected to result in a shortage of supply of vanadium.
The Green Giant Vanadium Project is expected to produce the high purity V2O5 required by the new vanadium-based technologies, as well as the form of vanadium – called ferrovanadium – required by the steel industry.
The Year in Review
March 2010: US$6.5 million private placement completed, with participation from Dundee Resources and Consolidated Thompson Iron Mines.
May 2010: listed on the TSX Venture Exchange
May 2010: initial NI 43-101 resource estimate consisting of an indicated resource of 21.74 million tonnes at an average grade of 0.759% V2O5 and inferred resource of 4.15 million tonnes at an average grade of 0.655% V2O5 announced
June 2010: strategic alliance with DRA Mineral Projects, a leading mine engineering and construction company based in South Africa, concluded
October 2010: Richard Quesnel joins board of directors
November 2010: metallurgical test work conducted by SGS Lakefield confirms vanadium recoveries of up to 82% with a pre-roast + alkaline pressure leaching process
November 2010: updated resource estimate that more than doubles initial resource
November 2010: in-house economic analysis of the Green Giant project completed by our engineering consultants, AGP, confirms very positive internal rate of return
November 2010: The Balloch Group retained to help identify potential Chinese partners. More recently, it was announced that The Balloch Group was being acquired by Canaccord Financial Inc. and was being rebranded as Canaccord Genuity Asia with Howard Balloch as Chairman
Julie Lee Harrs, President and Chief Operating Officer of the Company, comments, “On the basis of our extraordinary achievements in 2010, we are aggressively moving the Green Giant project forward both from a project development perspective, as well as with strategic partners. To this end, I will be travelling to Africa to advance the PEA and the discussions regarding our use of the infrastructure being constructed for the nearby Sakoa coal project, as well as to Europe and Asia to meet and conclude agreements with strategic battery and steel partners. Stay tuned for an exciting 2011.”
Management Ownership of Securities
Contrary to erroneous information that may be circulating, the Company confirms that no insiders have sold any shares or exercised any options to purchase shares of the Company.
Management continues to believe strongly in the future potential of the Green Giant project and the growth of both new vanadium-based technologies and traditional steel applications which will significantly increase vanadium demand.
The Company remains firm in its belief that the upside of this quantified and valuable resource will soon be realized.
The resource estimate referred to in this press release was completed by AGP Mining Consultants Inc. (“AGP”) and is in conformance with the CIM Mineral Resource and Mineral Reserve definitions referred to in NI 43–101, Standards of Disclosure for Mineral Projects.
For detailed information as to how the mineral resource was generated, please refer to the updated resource estimate that will be filed within 45 days of this news release on www.sedar.com under the Company’s profile.
Pierre Desautels, P.Geo., of AGP, the Independent Qualified Person under NI 43-101 responsible for the resource estimate, has reviewed this release. Mr. Desautels is the author of the updated resource estimate, which will be filed by January 15, 2011.
Vanadium is well-established as a strategic metal that strengthens and hardens alloys like steel and is positioned to play a significant role in emerging battery technologies such as batteries for electric cars and for large-scale energy storage. While there are some opportunities for substitution in steel production, the same is not true for other markets, including the emerging energy (battery) storage markets, the military and particularly in the aerospace industry, where vanadium is irreplaceable.
About Energizer Resources
Energizer Resources Inc. is a mineral exploration and development company based in Toronto, Canada. The Company’s common shares are traded on the TSX Venture Exchange under the symbol EGZ, on the Over-The-Counter Bulletin Board under the symbol ENZR, and on the Frankfurt Exchange under the symbol YE5.
For more information please visit our website at www.energizerresources.com
Vice President of Business Development
Toll Free: 800.818.5442 or 416.364.4911
or Julie Lee Harrs, President and COO