Wealth Minerals initiates REE exploration in Argentina

Wealth Minerals (WML-V) is kicking off an exploration program for rare earths in Argentina at Rodeo de los Molles, an undeveloped REE project that the company claims is the largest in South America.

The timing couldn’t have been better. Earlier this week The New York Times reported that China is expanding its restrictions on exports of rare earth elements, which are used to make everything from disk drives and wind turbines to high-powered magnets and smart bombs.

China’s Commerce Ministry later clarified that quota reductions were necessary because the country is closing down polluting mines and needs to make sure it has enough REEs to satisfy domestic demand.

REE prices have soared in recent months. Bloomberg reported Oct. 20 that prices for cerium oxide prices have climbed from US$4.70 per kg on April 20 this year to US$36per kg and neodymium has shot up from US$41 per kg in April to US$92 per kg today. The news agency sourced the figures to Metal-Pages Ltd., a company in London that tracks REE prices for its subscribers.

Wealth Minerals is earning an interest in the Rio de los Molles REE-uranium property, about 300 km southwest of the city of Cordoba and 200 km northeast of San Luis in Argentina. The company believes that the mineralization at Rio de los Molles is similar to that of Molycorp.’s Mountain Pass REE deposit in California. The Mountain Pass mine operated from 1952-2002.

Wealth Minerals signed an option agreement in May with MHSRL, a private company in Argentina, to acquire a 100% interest in the property by spending US$150,000 on exploration within 12 months and making subsequent payments over the next five years of US$3.6 million.

A non-compliant 43-101 resource estimate prepared in 1992 based on about 6,000 metres of shallow drilling and metallurgical test work by previous owners outlined a deposit of 5.6 million tonnes grading 2.1% total rare element oxides (TREO).

The Vancouver-based junior says that based on the historical data the deposit in San Luis province also remains open for expansion in all directions.

So far the company has collected three rock-chip samples from outcropping mineralization at the REE-uranium project that returned assays ranging from 7.4 to 35.5% TREO. The samples contained a heavy rare earth oxide (HREO) component ranging from 5.0% to 55.5%, and 0.15% to 0.92% of U3O8.

A fourth sample collected from an apparently un-mineralized outcrop, returned a value of 0.11% TREO, and 12.1 parts per million (ppm) uranium. The company believes these results indicate that there is potential to expand beyond the known mineralized zones. Moreover, it notes that outcropping mineralization remains open in all directions.

Wealth Minerals plans a two-phase exploration program to conduct a detailed surface assessment of the known mineralization and pinpoint new zones, as well as confirm the resource.

During the first phase the company plans to complete geochemical and geometallurgical study. It also plans channel-saw sampling of outcropping REE mineralization as well as geological mapping and prospecting to expand the known resource. The first phase will take about three months, the company estimates, and cost about $300,000.

In the second phase of the program, the company will complete roughly 1,000 metres of drilling over the course of a month at a cost of about $250,000.

The 72-hectare property is within 2 km of a paved road and within 8 km of electrical transmission lines.

Wealth Minerals has hired a specialist in rare earths, Alastair Neill, as an advisor. Neill is the former vice president and general manager of the rare earth division of AMR Technologies (now Neo Material Technologies Inc.).

Wealth Minerals closed up 4¢ or 7.3% at 59¢ per share. Over the last year the junior has traded in a share price range of 25¢-75¢ and has about 40 million shares outstanding.