Peak Resources' rare earth discoveries maybe just the tip of the iceberg at Ngualla

Peak Resources (ASX: PEK) has the potential to develop into a substantial rare earth oxide deposit, if the latest high grade near surface hits are anything to go by.

The latest highlights from 17 reverse circulation holes at the Southern Rare Earth Zone include the broad hits of 131 metres at 4.27% rare earth oxide (REO) from surface, 122 metres at 2.06% REO from surface, and 54 metres at 2.53% REO from 54 metres.

These zones are well supported by high grade intersections such as 22 metres at 6.17% REO from 18 metres, 18 metres at 4.41% REO from surface, and 34 metres at 4.36% REO from surface.

The importance of the latest intersections are that they confirm the internal continuity of the Southern Rare Earth Zone and extend the identified mineralisation a further 150 metres to the south west.

The extent of the plus 5% REO mineralisation now extends 660 metres in a north – south direction and 740 metres east - west on the most southern drill traverse completed to date by peak, where mineralisation has been tested to a maximum vertical depth of 155 metres.

Peak said that typical grades range from 3% to 7% REO from surface in the ferruginous weathered zone, which varies in thickness from zero to over 120 metre vertical, along with widespread primary rare earth mineralisation extending to depth within fresh rock carbonatite beneath the weathered zone, with typical grades of 1% to 2.5% REO.


The extensive 22,000 metre drilling program

Peak has an extensive ongoing drilling program at Ngualla which has now passed the half way point, with reverse circulation operations continuing on site - with a total of 78 holes for 9,882 metres completed within the Southern Rare Earth Zone.

Drilling recently wrapped up at the South West Alluvial Zone with an additional 107 aircore or tricone holes for 1,974 metres completed over a 1,400 metre by 700 metre area to average depths of less than 20 metres.

Diamond drilling has recently kicked off in the Southern Rare Earth Zone to provide material for metallurgical test work and density measurements for the resource estimation.


News flow pending

Peak is currently awaiting assay results from 132 completed drill holes, including a further 25 deeper reverse circulation holes from the highly prospective Southern Rare Earth Zone, which will ensure a steady flow of results in the coming weeks.

Several of these holes intersected deep ferruginous weathering up to 140 metres vertical depth in areas of known mineralisation.

Looking further forward, a maiden JORC rare earth resource is forecast to be delivered to the market by the end of the March 2012 quarter.


Comparrison to Mt Weld

Mineralisation at Ngualla in southern Tanzania is similar in style to Lynas Corporation's (ASX: LYC) world known Mt Weld project in Western Australia, due to being rare earth enrichment in the deeply weathered regolith profile of a large carbonatite.

Ngualla is a virgin discovery by Peak, with the first holes completed in June 2010. The project also has potential to host large, near surface deposits of niobium – tantalum and phosphate.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/20044/peak-resources-rare-earth-discoveries-maybe-just-the-tip-of-the-iceberg-at-ngualla-20044.html