LITHIUM

ZORO LITHIUM PROJECT

SNOW LAKE DISTRICT MANITOBA

PROJECTS KEY FEATURES:

  • Known lithium bearing pegmatites with documented historic resources as a starting point. Completed Phase 3 drilling stage and advancing.
  • Regional pegmatite area of concentration with Zoro dykes 1 through 7 and the Thompson Brothers dyke very similar to the Whabouchi region in Quebec hosting several large deposits.
  • Expanded land package with additional options and MOU provides the potential for aggregating larger tonnage resource in this region.
  • Mining region of Snow Lake with all required exploration and development services and personnel and close proximity to infrastructure of roads, power and rail lines
  • Manitoba a favourable location for mining in terms of regulation, support and power cost, ranking as second most attractive jurisdiction for mining investment by Fraser Institute 2106.
  • Access to rail to BC ports and Asian markets
  • Exploration team and program designed to find, define and grow lithium resources

OVERVIEW

Far Resources, an exploration and development company, will become a leader in  the energy metals sector by defining a lithium resource with their  Zoro project located in the Snow Lake region of Manitoba. The Snow Lake region  contains a known historic deposit of lithium bearing spodumene pegmatite. The property hosts seven identified pegmatite dykes, where  the historic resource completed only on Dyke 1 in the 1950s.

 

In 1956, the lithium deposit was considered an historic “reserve” based on the drilling of 1.8 million tonnes grading 1.4% Li2O to a depth of 305 m.. However, Far Resources does not treat the historical estimate as the current amount of mineral resources or mineral reserves which were defined by NI 43-101, since sufficient, reliable and valid work hasn’t been done confirming the historical estimate as the current value.

Work programs on the Zoro project began in 2016 with prospecting and sampling of the known dykes, confirming the lithium content of the spodumene bearing pegmatites.

 

Soon after, drilling confirmed the reported depth and continuity of Dyke 1 as seen in 1956.

In 2017, the Zoro project rapidly advanced due to the results yielded from continued drilling, revealing the possibility to expand the known lithium resources in Dyke 1.

The historical estimate of 1.8 million tonnes grading 1.4% Li2O is from 1956 for the main dyke (Dyke 1) on the Zoro Lithium property to a depth of 305 metres (1,000 feet) as reported by R. Mulligan, 1965: Geology of Canadian Lithium deposits; Geological Survey of Canada, Economic Geology Report No. 21, p. 80-82. The key assumptions, parameters, and methods used to prepare this historical estimate are unknown and it is only one of a number of varying historical estimates for Dyke 1. The final reported historical estimate for Dyke 1 consists of 1,287,550 tons grading 0.967% Li2O to a depth of 660 feet vertically below surface outcrop plus a possible 440,000 tons grading 0.882% to a depth of between 660 feet and 880 feet below outcrop for a total undiluted tonnage of 1,727,550 at 0.945% Li2O, using a dilution factor of 5% (Huston, C.C., Progress Report on Lithium Property, Herb Lake, 1956). However, these historical estimates were based on limited drilling and the historic assay database was not accompanied by a quality assurance and quality control program and sampling and analytical specifics were not reported making the data utilized in formulating the historical estimates limited in its reliability. In addition, no Li2O has been produced from the historical estimates. For these reasons, among others, the historical estimates should not be relied upon as a guarantee of mineral resources or mineral reserves. Actual resources or reserves, if any, may differ significantly. Re-logging of historic drill core to the extent possible, together with detailed geological mapping and additional diamond drilling to confirm the extent of the lithium-mineralized pegmatite at depth and along strike will be required to upgrade or verify the historical estimates as current mineral resources or mineral reserves. The historical estimates are, however, relevant as a guide to future exploration.

MOVING FORWARD TO DEFINE RESOURCES:

PROSPECT AND DRILL

A winter drill program will be used to assess the deeper levels (>150 m) of Dyke 1 in order to confirm the extension of high-grade lithium spodumene. This winter drill program will also be used to test historic high-grade lithium drill intersections, as well as recent assay results from trench and outcrop sampling at Dykes 5 and 7. Additionally, areas of anomalous lithium, tantalum and niobium in soils from overburden-covered areas adjacent to known pegmatite dykes including Dykes 5 and 7 will be drill tested.

PHASE 3 DRILLING

The third phase of drilling and sampling on Dyke 1 yielded exceptional results, expanding the dimensions of the known resources on Dyke 1, as well as confirming that Dyke 1’s width and grades are comparable to other more advanced lithium deposits in the area. Additionally, the results showed that higher grade intervals are present within DDH FAR17-18 and include 2.19% Li2O over 4 m and 3.12% Li2O over 1 m, with tantalum and niobium ranging between 32 and 152 ppm and 88 and 408 ppm respectively. Lastly, the results included 1.43% Li2O over 20.6 metres in DDH FAR17-18 and 1.15% Li2O over 12.4 metres in DDHFAR17-19.

Summary of weighted averages for lithium, tantalum and niobium
Summary of weighted averages for lithium, tantalum and niobium

SIZE MATTERS

BUILDING A LAND PACKAGE AND RESOURCE BASE

Size is one of the keys to defining an economical lithium deposit. While Far Resources started with the Zoro 1 claim, which initially contained the amount of the known historic resource, they were able to add parts of the adjacent claims covering the other known dykes in the area. and then added parts of adjacent claims to cover the other known dykes. This transaction expand the property from 0.5 km2 to 3.0 km2, resulting in a 600% increase in highly prospective ground.

For a regional development plan, size also matters. After confirming the high grade results from all of the dykes in the area, Far Resources acquired additional land to explore and discover any developmental potential. . By economically defining and accumulating tonnes, Far Resource’s market value rapidly grows when they are looking for new lithium sources.

 

To meet this plan Far is expanding its optioned lands with Strider Resources by another 2200ha contiguous to the Zoro package. This was followed by entered into a non-binding Memorandum of Understanding (the “MOU”) with Quantum Resources Limited (“Quantum”), an exploration company listed on the ASX (ASX: QUR). Quantum has the right to earn an interest in the Thompson Brothers lithium project in Manitoba. The Thompson Brothers lithium project is contiguous with Far Resource’s extensive holdings in the Snow Lake region of Manitoba. The Quantum property adds another 1829 ha to the regional lithium play and hosts the Thompson Brothers dyke is an 800 m long vertically dipping pegmatite dyke with an historic non NI 43-101 resource of 4.305 million tonnes grading 1.29 per cent Li2O completed in 1998. Drilling on the dyke the summer of 2017 confirmed grade and widths with an intersection of 11.6m at 1.37% Li2O. These two historic resources already contain over 6 million tonnes of known lithium bearing pegmatite to grow from and are located within 3km of each other.

LITHIUM IN MANITOBA

Far Resource’s project is well sited in Manitoba with the potential for development. Manitoba is home to multiple rare metal deposits, including the world-class Tanco lithium-cesium-rare metal pegmatite at Bernic Lake. It has a supportive pro-business climate, mineral exploration-supportive assistance programs, and excellent access to geoscience and exploration data that will assist the company’s advancing projects in the province.

Additionally, the province has stable and well-developed mining and transportation infrastructure. The hydro line to Snow Lake is 5 km south of the property and the small historic gold mining community of Herb Lake is located about 10 km southwest of the property. A railway line is located at Wekusko, approximately 20 km south of Herb Lake. Electricity rates in Manitoba are reasonably priced and comparable to Quebec and less than Ontario. The projects in Northern Quebec are 100s of km to the railhead at Chibougamau. Better infrastructure can lead to lower project development costs, lower threshold tonnage to support project development, and less time to reach this threshold.

TANTALUM & NIOBIUM:

INCREASING POTENTIAL VALUE OF THE ZORO PROPERTY

A recent high-grade drill intercept of tantalum (0.117 % Ta2O5 or 927 ppm tantalum; see November 1, 2017 news release) accompanied by elevated tantalum and niobium in samples of drill core, outcrop and soils has intrigued the company. Currently, the significance of the elevated tantalum and niobium is unknown but it will be closely assessed as Far Resource’s exploration continues.

However, while the significance of the Tantalum found in Far Resource’s property is unknown, it is likely valuable. Tantalum is a rare, hard, blue-gray, corrosion-resistant metal that is widely used as a minor component in alloys. The chemical inertness of tantalum makes it a valuable substance for laboratory equipment and a substitute for platinum. Tantalum sells for approximately $128,000 USD per metric ton and is primarily used in tantalum capacitors found in electronic equipment such as mobile phones, DVD players, video game systems and computers. Based on the Tantalum found in Critical Elements’ Rose project, where the Tantalum’s production grade is 133 ppm Ta2O5, the presence of tantalum made a ~10% credit to operating costs reported in their recent feasibility study.

Tantalum exists alongside niobium, a chemically similar metal, which is also valuable. Niobium metal sells for approximately $41,000 USD per metric ton. It is mainly used in alloys and is the largest metal in special steel, which is used in gas pipelines. Although these alloys contain a maximum of 0.1%, the small percentage of niobium enhances the strength of the steel. The stability of niobium-containing super alloys at high temperatures is important for its use in jet and rocket engines. Niobium is also used in various superconducting materials. These superconducting alloys, also containing titanium and tin, are widely used in the superconducting magnets of MRI scanners. Other applications of niobium include welding, nuclear industries, electronics, optics, numismatics, and jewelry.