Montero Mining says stage 2 refining testwork at Wigu Hill to begin early 2012

Montero Mining and Exploration (CVE:MON) provided an update on the ongoing mineral processing and metallurgical testwork at its flagship Wigu Hill rare earth property in Tanzania.

Initial mapping at Wigu Hill, performed as early as 2010, demonstrated the project's potential for a significant mineralized system. Montero said it started exploration work early in order to identify, test, and determine an efficient path to rare earth production.

In June 2010, Montero delivered the first bulk sample, obtained from the Twiga and Tembo zones at Wigu Hill, to the Mintek laboratory in Johannesburg. A second bulk sample was delivered in July 2010.

These samples, taken from trenches and pits in the Twiga and Tembo zones, formed the basis of the NI 43-101 compliant inferred resource estimate, which includes 3.3 million tonnes grading 2.6% light rare earth oxides (LREO).

Rare earth elements, a group of 15 metals, are critical in the development of emerging green technologies and high-tech applications, from electric and hybrid vehicles and wind and hydro power turbines, to LCD screens, MRI, X-ray machines, mobile devices and other computing equipment.

Currently, China produces 97 percent of the world's supply of the metals. With the rising prices of rare earths, and China's control over export quotas, it is becoming more and more critical to secure supply from other regions.

"Montero initiated mineral processing and hydrometallurgical testwork on the mineralized material from Wigu Hill before drilling had started on the deposit," said president and CEO, Dr. Tony Harwood.

"The exploration team realized that the challenge at Wigu Hill was not in the exploration, proving up the grade or tonnage, but in the metallurgical process routes that need to be defined to yield saleable rare earth products.

"Montero is well advanced in the metallurgical flowsheet established by our team with Mintek and this is on track with our First Producer Mine to Market strategy."

Montero is also working to determine the best hydro-metallurgical refinery method to produce saleable rare earth chemicals.

The stage one refining testwork has seen the completion of leaching tests, using a variety of leaching agents, from which Montero determined that a hydrochloric acid leach process was the most chemically efficient for Wigu Hill material.

A second leach test was successfully completed, and a third test, which is expected to produce a definitive process route, is ongoing, the company said.

The results of this third test will also provide a feed solution for the stage two refining testwork, which Montero expects will begin in early 2012.

The stage two refining testwork will define a process route for rare earth oxide (REO) feedstock. Once completed, this testwork will lead to a feasibility study, which will upgrade the stage one refinery to a larger production of REOs.

Stage one refinery optimization testwork will be completed by year-end, Montero said.