Kutessay II Heavy Rare Earth Element Mine
Kutessay II is the only past-producing Heavy Rare Earth Elements (HREEs) mine in the world outside of China. Stans Energy owns a 20-year mining licence for the property located in Kyrgyzstan in the former Soviet Union. The company has completed a JORC compliant mineral resource estimate as well as a supplementary REE distribution report which identifies the primary commercial components of the open pit mine. Stans has also released an internal metallurgical study which illustrates ways of improving the quality of Rare Earth Oxide (REO) concentrates produced at Kutessay II. These reports will be incorporated into an upcoming feasibility study for restarting rare earth production operations at Kutessay II, in cooperation with the same Russian institutes that originally designed and built the Kutessay II mine, mill and processing plants.
More information on Kutessay II:
- Kutessay II Facts
- JORC Compliant Mineral Resource Estimate
- Distribution of Rare Earth Elements
- Rare Earth Market
- Improving Quality of REO Concentrates
- REO Processing Facilities
- Re-sampling Results
- Mining Licence
- History
- Geology
- Overview
- Photos
Kutessay II Facts
- Former producing Rare Earth Element ( REE) open-pit mine
- Percentage of HREEs approximately 46%
- Contains all 15 REEs and formerly produced every REE at purities up to 99.99%
- Kutessay II concentrate was refined into 120 different REE compounds
- 30 years of proven metallurgy, with approximately 65% recovery
- Previously produced 80% of the former Soviet Union’s REEs from 1960-1991
- Good infrastructure, rail line 43 km away, electrical power on site, and the mine is located 140 km by paved road from Kyrgyzstan’s capital city of Bishkek
- Abundance of qualified labour living in the area
- Stans Energy owns 100% of the Processing Complex previously used to create final oxides metals and alloys from Kutessay II concentrate.
JORC Compliant Mineral Resource Estimate for Kutessay II
In March 2011, Stans Energy released an independent technical report, which includes an Australian Joint Ore Reserves Committee (JORC) compliant mineral resource estimate (Australian equivalent to a NI 43-101, see www.jorc.org for details) for the REOs remaining below the Kutessay II open pit mine. The comprehensive, 151-page report was prepared by the Kazakhstan Mineral Company (KMO) and authored by the Qualified Person Vladimir V. Danilov, a member of the Australian Institute of Geoscientists. The Kutessay II Mineral Resource Estimate Technical Report is posted on www.sedar.com.
The report was completed by conducting an underground channel sampling program which confirmed the accuracy of historical sample data, comprising of 5,552 channel and core samples, each measuring 1.5 m in length. The JORC estimate shows a combined Measured and Indicated Mineral Resource of 42,980 metric tonnes (mt) RE2O3, at an average grade of 0.264%, plus an additional Inferred Mineral Resource of 3,560 mt RE2O3, at an average grade of 0.204%. The resource remains open to depth below previously explored levels. The Mineral Resource Estimate does not include stockpiled mineralized material from historic mining operations. The Kutessay II Mineral Resources are summarized in the following table:
Mineral Resource Estimates at Kutessay II
The JORC estimate also indicates that Measured and Indicated Resource tonnage and grade vary at different elevations, from the lowest pit walls to below the lowest exploration adit. The following table gives the estimate of the total Measured and Indicated RE2O3 Mineral Resource for each 10 metres (m) in elevation.
REO Grade and Tonnage Across Elevations at Kutessay II
REO tonnage and grade estimates were also shown to vary across host rock types. The majority of REOs are found in quartz-chlorite metasomatites and quartz-sericite metasomatites, with the highest grade REOs found in biotite hornfels. Below is a summary of the rock types hosting rare earth mineralization.
REO Mineralization in the Kutessay II Deposit
Historically, Kutessay II also produced lead, molybdenum, silver and bismuth. Because there was no reliable historical data to quantify the remaining resources of these elements in the deposit under the rules of JORC, Stans plans to undertake additional metallurgical testing to help determine the potential for these valuable by-products.
Distribution of Rare Earth Elements at Kutessay II
In April 2011, Stans Energy released a supplementary report to the JORC estimate illustrating the overall distribution of the individual REEs within the Kutessay II deposit. The report was prepared by a team of experts with extensive knowledge on the history of the Aktyuz Ore Field, led by N. N. Malyukova. A summary of Malyukova’s findings is as follows:
This REE breakdown will be the distribution estimate to be used for the Kutessay II feasibility study. It is important to note that individual REE distributions vary across elevations and mineral types. Near the surface of the deposit, a greater proportion of HREEs exist compared to LREEs. Stans plans to conduct drilling below the lowermost 2215 Adit Level of the deposit to: better define the rare earth element distribution, delineate and confirm inferred mineral resources identified in the JORC technical report, as well as to test the extension of REE mineralization below the currently known deposit.
N. N. Malyukova’s report , “Distribution of Mineral Ore Types and Grades of Rare Earth Elements in the Kutessay II Deposit” will be posted on www.sedar.com as a supplemental report to the Kutessay II JORC Mineral Resource Estimate.
Rare Earth Market
The sole source of the world’s HREE production comes from the ‘Ionic Clays’ in the south of China. Representatives of the Chinese Society of Rare Earths have repeatedly stated that it is likely that the country will become a net importer of HREEs in the near future. Kutessay II is one of the only sources of HREEs located outside of China prior to 1991, when the mine shut down.
HREE prices have increased substantially in recent history, due to increasing demand, and supply constraints from China. The international prices for all 15 REEs have been very volatile, and no long term price can be accurately determined based on conventional methods of valuation. Below is a table illustrating the current international price per kilogram of each REO on February 21, 2012 in USD, based on FOB surveys.
*Prices are volatile, and subject to change regularly.
| LREEs $/KG USD | HREEs $/KG USD | ||||||||||||
| La | Ce | Nd | Pr | Sm | Eu | Gd | Tb | Dy | Ho | Er | Yb | Lu | Y |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| $35 | $33 | $175 | $175 | $74 | $3400 | $148 | $2600 | $1550 | $120 | $205 | $155 | $1270 | $145 |
The United States Geological Survey has predicted that most critical REOs in terms of future supply versus expected demand are Yttrium (Y), Dysprosium (Dy), Terbium (Tb), Neodymium (Nd), and Europium (Eu). Based on the breakdown of REOs contained within the Kutessay II deposit and their respective oxide prices, these critical elements, with the exception of Europium, are likely to represent the majority of Kutessay II’s value.
Distribution of Individual REEs at Kutessay II
Kutessay II Ore Distribution by Oxide Value USD
(based on FOB surveys of international prices per kilogram of REOs on February 21, 2012)
Improving Quality of REO Concentrates at Kutessay II
Stans Energy followed up on the JORC compliant mineral resource estimate for Kutessay II with the release of its internal Metallurgical Testing Report in March 2011. The 179-page study was completed by the Information Research Centre (IRC), reviewed by the Leading Russian Research Institute of Chemical Technology (VNIIHT), and verified by Stans’ geological and mining experts. The report details the findings of Stans’ lab scale metallurgical testing at the concentrate stage, and was commissioned to identify ways to improve on historical methods of creating rare earth oxide (REO) concentrates at Kutessay II in four categories:
- Decrease the costs associated with the historical milling process
- Recover additional polymetalic by-products
- Increase the Total REO (TREO) content within the concentrate significantly above the historical 6.5% grade
- Increase the TREO recovery above the historical average of 64%
This study involved analysing and testing modern magnetic and gravitational milling techniques on two representative samples of the Kutessay II resource. Lab scale gravitational separation proved to be a superior first step in the concentration process, when compared to historical magnetic separation methods. It was also determined that a pilot scale Falcon concentrator was needed to properly test the new proposed gravitational concentration process. Based on these results, IRC, in association with VNIIHT, and under the supervision of Dr. Valery Kosynkin, have come up with a proposed concentration flow sheet to be tested at a pilot scale. For an illustration of this process, see our Rare Earth Processing page.
The proposed concentration method addresses IRC’s objectives in the following ways:
- Costs – The proposed process has been estimated to reduce the amount of processed material by up to 60% after the 1st stage, when compared to the historical method. Lab tests indicate this step has the potential to significantly reduce the historical costs of crushing the ore to a powder, floating, and drying
- Byproducts – Tests including magnetic separation were able to achieve recoveries in the concentrate of 80.0-80.5% Silver, 77.5-80.0% Lead, and 84-89% Bismuth. Recoveries of Zinc and Molybdenum ranged between 48.0% and 57.0%
- TREO Content – Testing of both samples achieved a TREO content in the concentrate ranging from 13.373% to 19.471%, a significant increase from the historical average of 6.5% TREO. To increase the quality of the final concentrate (removal of ore magnetite and technogenic iron appearing from ball grinding in the ball mill), IRC recommended to subject the final concentrate to magnetic separation. If the proposed milling process is implemented, and scaled results are similar or better than to lab tests, far less waste rock would have to be trucked to Stans’ newly purchased RE Processing Complex
- TREO Recovery – Achieved throughout recovery, with magnetic separation as step 1 and not accounting for additional recoveries from flotation of stage 2 and 3 gravitational tailings, ranged between 47.65% and 51.68% TREO. Gravitational separation tests without magnetic separation achieved recoveries for the individual REE in the range 0f 50 – 72%. The proposed 3-stage gravitational separation process will test RE tails after stage 2 and stage 3 for additional REO recoveries through control flotation, calcinations, and chemical dissolution in an attempt to increase recovery numbers
Stans’ pilot scale study in 2011 will determine whether this proposed milling process, or the historical flotation process will be most cost effective.
REO Processing Facilities for Kutessay II
The REO concentrate produced at Kutessay II will go to the nearby Kyrgyz Chemical-Metallurgical Plant (KCMP), which was designed to process ore from REE open pit mine during the Soviet era. In January 2011, Stans reached exclusive agreement with the plant’s owners to buy 100% of KCMP’s RE processing complex along with a nearby private rail terminal for $5.5 million USD. That deal was approved by KCMP shareholders in February 2011.
Kutessay II Re-sampling Results
Prior to the JORC compliant mineral resource estimate, Stans Energy undertook a re-sampling program to verify the extensive amount of historical prime data previously completed on the Kutessay II deposit. This process, which involved re-opening and re-sampling one of the underground adits below the pit, proved to be an accurate, and cost-effective method of data confirmation. The full re-sampling report, and the map of the adit used can be found here:
Kutessay II Mining License
In December 2010, Stans Energy Corp. received a 20-year mining licence for the Kutessay II HREE open pit mine in Kyrgyzstan. The company acquired 100% of the Kutessay II deposit along with 100% of the Kalesay Beryllium deposit from the Government of Kyrgyzstan for $855,000 US by acquiring 100% of “Kutisay Mining” on the Central Asian Stock Exchange. In January 2010, Stans acquired an exploration license for the REE Aktyuz Ore Field, which surrounds the Mining License for Kutessay II, and the Kalesay Beryllium deposit. The Mining Licence for Kutessay II and the Legal Due Diligence Summary Report prepared for Stans can be found below:
View a copy of the Kutessay II Mining License
Kutessay II History
The history of Kutessay II is closely connected with the study of the whole Aktyuz ore field. Workings by ancient miners, dating to the 10th Century, were very widespread in the form of mining, the remnants of smelting furnaces and slag heaps. In modern times, the Aktyuz deposit was known to local hunters.
Kutessay II Geology
The Kutessay II REEs deposit, is located in the Kemin area on the northern slope of the Tasa–Kemin mountain Range, about 1 km southwest of the Aktiuz deposit, at 76_07E, 42_51N. The deposit was discovered in 1943 with reserves calculated in 1951.
Kutessay II Overview
Rare earth metals (hereinafter REM) were known at the Aktyuz Ore Fields of the Kyrgyz Republic since the 1930s and started to be seriously examined from 1956, when industry was in sharp need for elements of yttrium group, especially thulium.
Photos of Kutessay II
Paved road to the mine
Kutessay open pit
Stockpiled ore in the pit
Original Aktyuz Production Exit
