VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 06/03/11 -- Apella Resources Inc. (TSX VENTURE: APA)(OTCQX: APAFF)(FRANKFURT: NWN) is pleased to announce that SGS-Geostat has delivered to Apella its updated NI 43-101 resource estimation update for the Iron-T Vanadium-Iron-Titanium Project in Quebec, Canada. The Iron-T Vanadium-Titanium-Iron property located 18km east of Matagami in the Province of Quebec, Canada. This latest calculation reports an estimated increase of 24% in the quantity of the inferred resource over the previous report dated August 2010.
The intent of this updated resource estimation report by SGS-Geostat was to provide a comprehensive review of the 2009-2010 exploration activities. This latest independent NI 43-101 resource estimate completed by SGS-Geostat is based on 41 drill holes including 2 revised historical drill holes for a total length of 5,519 metres (18,107ft).
In SGS-Geostat's opinion, the Iron-T mineral deposit contains enough resources to justify additional exploration work and development work on the property in the optic of a bulk sampling, preliminary economic assessment study and prefeasibility study.
Currently, all of the resources reported on the Iron-T are classified in the inferred category. Many of the sections so far contain only one drill hole giving limited information on the deposit. Even though two separate small interpreted solids were intersected by at least two drill holes (trenches) within a radius of 50m, there is not enough information yet validating the grade and lateral continuity of the solids. For this reason holes MA-10-35, MA-10-36, MA-11-37 drilled on the western extension of the Main Zone over a distance of 1.8 km have not been considered in the resource calculations, despite their excellent mineralized intersections.
The classified inferred resources reported in this latest SGS-Geostat report are compliant with standards as outlined in the National Instrument 43-101. These resources were calculated using a minimum cut-off grade of 0.48% V2O5Eq and now estimated at 14,376,000 tonnes of the inferred category at 0.42% V2O5. This represents a 24% increase in the classified inferred resource of 11,600,000 tonnes in SGS-Geostat's last report.
The mineral resources estimated to date on the Iron-T Project by SGS-Geostat are presented in the table below.
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Current Inferred Mineral Resource Estimate - Iron-T Project
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V2O5Eq
Cuttoff
(%) Tonnage Volume Fe (%) Fe2O3(%) TiO2(%) V2O5(%) V2O5Eq (Eq)
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0.48 14,376,000 6,331,000 27.30 39.04 6.55 0.42 0.77
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Considering the fact that the Iron-T mineral deposit holds a 'non-negligible' portion of TiO2 and Iron ore, SGS considers the 0.48% V2O5Eq cut-off grade as a conservative cut-off and is the one recommended. This cut-off corresponds roughly to a combined cut-off of 0.26% V2O5 and 3.78% TiO2. If the combined cut-off would have been used, a small decrease in tonnage would have been observed in comparison to the V2O5Eq cut-off.
The V2O5, Fe and TiO2 prices used in the SGS-Geostat report were provided by Dr. C. Derosier of Apella as of June 21th, 2010 the same as utilized in the August 2010 report. Those prices were obtained from Metalprices.com, a website specializing in the current metal prices in the World. SGS-Geostat did not do an extensive research of the dollar value of vanadium, TiO2 and Fe concentrates.
V2O5EQ = V2O5 + 0.011(i)Fe + 0.006(ii)TiO2 in %
(i)$182/tonne metric
(ii)$90/tonne metric
V2O5: 14$/kg
The prices were provided by Dr. C. Derosier of Apella.
It should be noted that this latest resource estimation by SGS-Geostat does not include the 19 hole, 2,893m (9,491ft) Phase 4 diamond drill program just finished by Apella on this project. This latest 19 hole drill program included 11 in-fill drill holes in the main Genesis Deposit being delineated on the Iron-T Vanadium-Iron-Titanium Project.
As part of the independent verification program, SGS-Geostat validated Apella's exploration methodology including core logging, sampling, analytical procedures, and QAQC protocols and procedures.
Although still considered as preliminary and based on the optic of an open pit operation, the mineral processing results of 2009 and 2010 showed interestingly good recovery results. Tests included limited Davis tube tests, density tests, Satmagan tests and a mineralogy study. The 2011 Davis tube Vanadium recovery was high; averaging 88.7% recovery with 90% of samples having a recovery of greater than 79.6%. This means that the Iron-T mineralization has an excellent recovery rate. Specific Gravity (SG) testing gave results from 2.93 to 4.37 and a mean average SG of 3.68. The specific gravity is a function of the concentration and weight of the mineralization. The Satmagan (content magnetite (Fe3O4)) averaged at 33.8%, and ranged from 13.7% to 48.8%. Results of the Satmagan shows that magnetic iron oxide content varies from disseminated to massive layers. The average Ti and V contents were 5.51% and 0.34%, respectively. These results show that Titanium represents a non-negligible element and that the vanadium content is similar to the Lac Dore deposit. The concentrates from the mineralogy tests contained between 80.9% and 96.5% combined Fe-Oxides, Ti-Magnetite and Ilmenite; which means that the concentration method is adequate and the recovery obtained is excellent. For most of the samples analyzed, the major carrier of Vanadium is the Fe-Oxides (ranging from 66.2% and 91.2%) with Ti-Magnetite being a minor carrier, at between 7.19% and 32.0%; which means that layers with higher Ti values will return lower vanadium values. Between 64.3% and 90.9% of the Oxides were free, and between 6.46% and 20.7% of the Oxides were liberated. This signifies that oxides are easily recoverable by physical process. The locked Oxides were mostly associated with non-opaque gangue (between 2.22% and 14.9%), with a much smaller proportion associated with sulphides (between 0.00% and 1.92%). This is excellent for Apella because the Iron-T deposit has a very low sulphide content which permits it to be used by the steel industry.
The mineral resource block model has been interpolated from 1.25 m long analytical composite data constrained within a 3D wireframe envelop of the mineralized geological model defined from drill hole mineralized intercepts. The mineral resource model is defined by blocks 5 m (east-west) by 5 m (north-south) by 5 m (elevation) in size, located below the bedrock/overburden interface, and covers an area located within sections 324,500 m E and 325,800 m E on the Property to a maximum depth of 220m below surface. The length of the drill tested zone comprised between these two coordinates, is 1,300m. The interpolation of the block grade was performed by inverse distance squared method in multiple passes using anisotropic search ellipsoids increasing is size from one pass to another. This is an industry standard. The mineral resources calculated by SGS and representing a small portion of the property correspond to the estimated blocks located below the bedrock/overburden interface. A bulk density (SG) of 3.5t/m(3) was used to calculate the final tonnage of the mineral resources based on the available data. Each deposit is unique and has its own specific gravity depending of the mineral composition and concentration.
Following a bias observed in 2010 by SGS-Geostat, corresponding in a 15% average grade difference between original and duplicate V2O5 (Vanadium Oxide) assay results, reported by various labs utilized SGS-Geostat initiated a 2011 independent sampling program involving the assay of 81 samples submitted to two other independent certified laboratories. The 2011 independent sampling program was similar to the 2010 independent sampling program. The V2O5 (V) average grade of original assays gave results from 12.9% to 18.7% higher than the independent samples (SGS Lakefield and Actlabs). SGS found that the ALS-Chemex laboratory tends to be the one with the overall highest average iron, TiO2 and V2O5 grades. The SGS Lakefield laboratory and Actlabs are respectively ranked second and third. Since the majority if not all of the original samples were sent to the ALS-Chemex lab, SGS strongly recommends continuing and implementing QAQC procedures involving certified materials (standards) from the industry to be sent to the ALS-Chemex lab to check any calibration errors. Apella is implementing a QAQC program involving the assay of certified materials (standards) in order to verify the calibration of the laboratory and two other laboratories. According to the findings of this QAQC program, these results will help determine a correction factor on the assay results.
SGS made the following recommendations: 'The project needs additional definition including detailed cartography and diamond drilling before being ready for mining. The additional drilling would increase significantly the quality of the geological information as well as the update of the overall resources and the geological model. With addition of the drilling data, the update of the resources could include the measured and indicated resources categories. SGS recommends infill drilling and target drilling.'
This press release has been reviewed by Dr. Christian Derosier, P. Geo., Consulting Geologist and Qualified Person for the Iron-T project under National Instrument 43-101.
Additional information is contained on the Company's website at www.apellaresources.com.
ON BEHALF OF THE BOARD OF DIRECTORS OF APELLA RESOURCES INC.
Patrick D. O'Brien, ICD.D, Chairman
S.E.C. Exemption 12(g) 3-2(b) File No. 82-3822, Standard & Poors Listed, Dun & Bradstreet Listed.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Apella Resources Inc.
Adrian Bakker
604-683-8990 or Toll Free: 1-800-663-8990
604-683-8903 (FAX)
apella@apellaresources.com
www.apellaresources.com
