Ionic’s Phase 5 drilling to upgrade and expand Makuutu REE resources

Ionic Rare Earths will soon start further exploration targeting areas at its Makuutu rare earths project for further resource growth after securing the approval from the Ugandan government.

The Phase-5 program includes the resumption of drilling at Retention Licence (RL) 00007 to increased Inferred Resources to the higher confidence Indicated category as well as drilling on exploration targets on Exploration Licences (EL) 00147 and 00257.

Ionic Rare Earths (ASX:IXR) has secured the drill rigs required for the program and expects drilling to begin this month.

While Makuutu consists of six tenements, only the central tenement – RL 1693 – has been used to support the recent Stage 1 Definitive Feasibility Study which outlined a project with a mine life of 35 years and robust economics – including EBITDA of $2.29bn and internal rate of return of 32.7%.

The addition of other tenements provides the scope for further growth and increasing geopolitical importance.

“The long-term exploration potential is immense. Given the positive Stage 1 DFS at Makuutu, the progress now on the demonstration plant at Makuutu, and the pending mining licence award at Makuutu on RL 1693, the company has an eye to further growth to support the next MLA (Mining Licence Application) on the Makuutu western zone due to be submitted later in 2024,” managing director Tim Harrison said.

“This new exploration program will help us support the next MLA plus also refine our potential growth targets to the east at the massive EL00147 target, and the new north-western target at EL00257.”

Phase-5 drilling

The approval from Uganda’s National Environment Management Authority (NEMA) gives the company the green light to carry out about 4,380 m of core drilling on RL00007 and 2,230m of rotary air blast drilling on the targets in EL00147 and EL00257.

Drilling at RL00007 will seek to increase the confidence in the resource, which will in turn support the Stage 2 DFS and the next MLA which the company expects to complete on the licence in November 2024.

Makuutu currently has a resource of 532Mt at 640 parts per million (ppm) total rare earth oxides (TREO) of which only a small component (39Mt at 470ppm TREO) is located within RL00007.

Some extensional drilling is also planned, which could further increase resources in the licence.

Meanwhile, the exploration targets that will be tested by the RAB drilling represent the highest identified TREO grade Inferred resource and Exploration Target mineralisation at the project.

Success could substantially increase resources at the project given the sizable Exploration Target ranges from 216Mt to 535Mt grading between 400ppm and 600ppm TREO.

This article was developed in collaboration with Ionic Rare Earths, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.