For those who have not read about JRv b/4 : part of the ann...

For those who have not read about JRv b/4 : part of the ann .below(refer to ann. to check abut gold production )

Young Reserves.
The results are sufficiently attractive to justify work on a larger representative sample.
Recovery of nickel and cobalt is the primary objective but there is clear potential, using the
ACLP process, for the recovery of high grade haematite as a by-product. With the
excellent existing infrastructure at Young – roads, railways, power, gas etc,- an iron ore
by-product would be of great value. A second by-product would be scandium if justified by
market requirements for this exotic metal.
A mine designed to operate at a rate of 10 million tonnes per year from the Young
resource and with an expected mine life of 20 years, has the potential to yield the
following:
Metal Recovered Tonnes
p/a
Gross Value
A$*
Nickel1 50,000 625,000,000
Cobalt2 6,000 165,000,000
Iron Ore (Fe) Haematite3 1,600,000 100,000,000
Gross Annual Income 890,000,000
1Nickel @ US$10,000/t
2Cobalt @ US$22,000/t
3Iron Ore @ US $50.00/tonne 66% Fe
*One A$ equals US$0.80 cents
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By product iron oxide could potentially provide an additional 10% increase in gross
value of mine production, subject to product quality confirmation. Capital and operating
costs for nickel and cobalt recovery are expected at this early stage to be of the order of
50% of those pertaining to the Pressure Acid Leach (PAL) system. Additional costs for
by-product iron production are yet to be quantified but are also expected to be favourable.
Testwork and desk-top scoping studies proposed for 2005 should yield more precise
estimates for any pre-feasibility study.
The Company’s resources of nickel, cobalt and iron as a possible by-product, have been
fully explained to shareholders and are by far the major asset in the Company. The gross
‘in ground’ value of the nickel/cobalt/iron resource exceeds A$39 billion at present day
prices. Even if present day prices are not maintained in the future, the gross in-ground
value would still be unlikely to fall below A$25 billion. This is the driving force behind the
Company’s attempts to find a ‘new’ and practical process to ‘unlock’ the above value for
Shareholders. At present day prices, the resource has about the same value as 19 million
oz gold.
In the short term, duplicate samples from Young are being re-assayed. Early in 2005,
some in-fill drilling is planned to recover sample for the next phase of test-work which will
be carried out in Sydney if possible and should be complete by 30 June 2005 (this phase
is expected to cost about $300,000). At some appropriate time, the Company will seek a
strong joint venture partner for the Young project. The Company is optimistic about the
potential outlook for chloride leaching of Young nickel laterites and will report on further
results as they become available.
There are recent reports from Europe of a pilot ‘heap leach’ test using sulphuric acid on
Turkish nickel laterites by a group with whom BHP Billiton reportedly signed a co-operation
agreement in September 2004. Jervois is planning some additional laboratory ‘heap
leach’ test work along similar lines on Young laterites but concentrating on the use of an
alternative hydrochloric acid based process at atmospheric pressure. A proprietary
sulphuric acid process was previously tested between 2001 – 2003 and found to be useful
for the Young resource but too selective in actual operation.
Thus a second potential option for the future development of the Young laterite nickel
resource could conceivably be a large scale ‘heap leach’ operation using hydrochloric acid
treating up to say 10.0 million tonnes of laterite per year. The economic viability of such a
process would need to be determined by appropriate laboratory and pilot testing and
associated engineering and economic studies.
Project Summary – Young, NSW
1. JRV shares on issue: 760,000,000
2. Market price per share (current): $0.03 (3 cents)
3. Current Market Capitalisation: $23.0 million
4. Current Market Capitalisation per pound of $0.0061 (0.61 cents)
Nickel equivalent – indicated and inferred (present nickel price is
resource: $8.40 per lb)
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5. Young – acquisition and development costs ($1,335,000)
to date and per lb of nickel equivalent $0.00035
(total indicated and inferred resource)
6. Resource tonnes Ni grade, Co grade, Fe 167.0 million tonnes @
grade (Nickel equivalent 1.03% Ni): 0.72% Ni, 0.07% Co and
20% Fe
7. In situ metal tonnes - Nickel: 1.2 million tonnes
Cobalt: 117,000 tonnes
Iron: 33 million tonnes
8. In situ metal value at current prices –
(0.6% Ni cut-off)
Nickel: 25 billion dollars
Cobalt: 7.3 billion dollars
Iron: 3.7 billion dollars
9. Chart of nickel prices as supplied by Rothschild LME.
NYNGAN, NSW
Exploration Licences 6009, 6095 and 6096
Nickel, Cobalt and Scandium in Laterites
Two sampling programmes were commenced on the Nyngan Licences during the Quarter.
At Honeybugle, where anomalous scandium in soil was found in a trial soil sampling
programme conducted in May/June 2004, a programme comprising the taking of 100 soil
samples was completed. The samples were taken on 7 lines on 4 grids at spacings of
generally 50 metres. Three of the grids produced strongly anomalous results with values
up to 160ppm scandium in soil. The fourth grid contains too thick a regolith cover for
surface soil sampling to be effective.
The second area sampled was on the Nyngan tenement. In this area, anomalous gold
was discovered by others in recent calcrete sampling and nickel laterite drilling. The
drilling was not designed for gold targets but intercepted 6 metres of 0.28 g/t Au in one
hole and 18 metres of 0.05 g/t Au in another. A 50 by 100 metres grid of auger sampling
was completed over the area that contains gold, magnetic and structural anomalies.
BEACONSFIELD, TASMANIA and NYNGAN, NSW
Exploration Licence 1/2001
Nickel/Cobalt Laterite
A private Canadian company, Nickel Resources International Inc (NRI), is considering
earning equity in these resources by expending funds on pre-development work including
exploration drilling for sample recovery and any necessary follow-up metallurgical
testwork. Fund raising by NRI is in progress and any significant developments that affect
Jervois will be advised promptly.
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MOUNT MOSS, QLD
Mining Lease 10171
Copper, Zinc, Silver and Magnetite Prospect
The Company has negotiated an option over this property with a Queensland Company
which could lead to the sale of the lease by 17th June 2005 for $200,000. The Company
would retain a royalty of 1.5% Net Smelter Return from future base metal and silver
production.
FORESTS REEFS, NSW
Exploration Licence 4620 – Copper/Gold
(Newcrest Operations Limited 80%, Jervois Mining Limited 20%)
Newcrest report as follows:
“One hole, FRNC014, was completed. Hole details are below:
Hole East (MGA) North (MGA) Dip Azim (CML) Depth
FRNC014 692,945 6,295,898 -50 198 deg 795.2m
This hole was collared on 16th October and was completed on 10th November for 795.2m.
This hole is dominated by volcaniclastic conglomerate and subordinate feldspar porphyry
dykes to around 494m. These rocks have been weakly to moderately chlorite + epidote
altered with patchy reddening and magnetite alteration noted. The intensity of sericite
alteration increases approaching the monzodiorite below. Below 494m the hole is
dominated by massive, equigranular monzodiorite with weak to moderate chlorite + sericite
alteration. Occasional zones of quartz ± pyrite ± tourmaline veins were noted.
Assays have been received to 462m”.
From To m Au (g/t) Cu (ppm) Cut off (Au eq)
0 +462 +462 0.04 203
Incl 26 28 2 1.85 1160 2.0
236 240 4 0.65 1545 0.5
312 322 10 0.24 468 0.1
Expenditure on exploration for the Quarter was $29,244.
DUNCAN C. PURSELL
MANAGING DIRECTOR
All Resource Statements have been prepared by a competent person, Mr A. Jannink, FAusIMM,