Red Wine HREE Project
Medallion’s Red Wine HREE Project explores for the heavy-rare-earth elements (HREE’s) at the Red Wine peralkaline intrusions, which lie approximately 90 kilometres northeast of Churchill Falls, Labrador, Canada.
The Red Wine HREE Project is Medallion’s most recent acquisition. As it is a heavy rare-earth-element prospect, it is an important addition to the company’s portfolio. The Red Wine intrusions are a new, increasingly important HREE area play. At this time, property in the area is held by nine publicly traded companies (including Great Western Minerals Group Ltd & Rare Earth Metals Inc), two private companies and 12 private parties.
Project Highlights
- The Red Wine intrusions in Labrador are a major new HREE area play
- Medallion’s holdings cover key areas of the peralkaline Red Wine intrusions that are known to host eudialyte, an important HREE-bearing mineral, which experts believe will prove to be the world’s main source of HREE’s
- Summer 2010 exploration program included airborne radiometric survey, an NI43-101-style Technical report and field and laboratory evaluation by key REE experts
- Medallion has option to acquire 100% of seven mineral licenses (46.5 square kilometres) is subject to a 3% royalty.
Heavy-Rare-Earth Elements (HREE’s)
The lanthanide rare-earth elements, which are listed in the first of the two rows that appear at the bottom of the Periodic Table of the Elements, are divided into light (LREE’s) and heavy (HREE’s) groups. “Light” and “heavy”, refer to the elements’ atomic weights.
Over the last two years, the division between LREE’s and HREE’s has been reset to between samarium and europium. Now, there are five natural LREE’s (lanthanum to samarium) and nine HREE’s (europium to lutetium). Promethium is not included because it does not occur naturally in the earth. Yttrium, which is not a lanthanide, usually is included with the HREE’s because it shares properties and occurrences with this group.
HREE’s are more rare in nature and hence, in general, more valuable than the light REE’s. There has never been an HREE mine, per se, and very few pure HREE prospects are known. Historically, HREE’s have always been by-products of LREE, uranium or niobium mines.
The commonly traded HREE’s are europium (used for TV & computer screens), terbium (used for TV tubes & computer memories) and dysprosium (used for high-temperature super-magnets).
Medallion’s Red Wine HREE Project comprises seven mineral licenses in four groups, which cover a total of 46.5 square kilometres in southern Labrador. The main license (22.25 square kilometres) is in the southern portion of the Red Wine intrusions, located about 90 kilometres northeast of Churchill Falls, Labrador and 16 kilometres east of provincial route 389 (54 o 0′ N lat, 62 o 42′ W long – NTS maps 13L/2 & 13E/10W). The second largest license (15.75 square kilometres) is in the northern portion of the Red Wine intrusions (54 o 8′ n lat, 62 o 35′ W long – NTS map 13L/2). The remaining two licenses (475 and 375 square kilometres) cover smaller satellite peralkaline intrusions to the east (southeast potion of NTS map 13L/2).
The terrain in the project area expresses the moderate relief typical of the rugged glaciated northeast coast of Canada. The topography has been glacially elongated to the northeast and, although rivers and streams are prominent, lakes and swamps still dominate the drainage pattern. Valleys and hillsides are covered by glacial moraine material. Elevations above sea level range from 300 to 400 metres for valley bottoms and from 500 to 600 metres for hilltops. Outcrops are restricted to hilltops and make up only about 15% of the terrain.
The area is covered by moderate to dense boreal pine, spruce and fir conifer forests with occasional deciduous stands of mainly alder. Deciduous species and some conifers tend to be stunted and shrubby. The large-animal population comprises black bear, moose, caribou and deer. Temperatures during 2009 for nearby Churchill Falls ranged between 31 to -34 Celsius. Precipitation in 2009 totaled 739 millimetres (29 in.) including over three metres of snowfall. Spring breakup occurs in late May.
Option and Land Position
Medallion has negotiated an option to purchase 100% of the four Red Wine mineral license groups. In order to exercise the option and acquire the 100% interest, subject to a 3% royalty in favour of the license vendor.
To maintain the option, as amended, Medallion must pay to the vendor in installments, over a period of five years, cash payments and share issuances and complete exploration work commitments as follows:
| Five-Year Option to earn 100%* | Cash payment | Medallion shares | Work completed |
| Upon TSX Venture Exchange approval | 200,000 | ||
| End of first year | $50,000 | 250,000 | $50,000 |
| End of second year, an additional | $100,000 | 250,000 | $50,000 |
| End of third year, an additional | $100,000 | 350,000 | $100,000 |
| End of fourth year, an additional | $100,000 | 350,000 | $100,000 |
| End of fifth year, an additional | $125,000 | 500,000 | $100,000 |
| TOTAL | $525,000 | 1,900,000 | $400,000 |
* 100% interest subject to 3% royalty, half of which may be purchased for $1.5 million.
Medallion will be the operator of the project during the Option period.
Permitting, Environmental and Social Situations
The Labrador permitting procedure is similar to that of other Canadian jurisdictions. The initial exploration work permit, which covers mapping, sampling and geophysical surveys, requires a single application to the Mineral Lands Division of the Mines Branch, Newfoundland and Labrador Department of Natural Resources. This type of permit is usually granted within two months of application. More invasive exploration, such as drilling, requires a more detailed permit and a is more time-consuming application process.
There are caribou in the Red Wine area. As with other Canadian jurisdictions that have caribou, certain restrictions apply. In the Red Wine area, intensive and noisy activity, such as drilling or frequent helicopter flights, is proscribed during calving season, which ends 1 July. This intensely noisy activity over a large area is disturbing to the caribou.
The seven Red Wine licenses are not in, or near an area affected by First Nation land claims. There is, however, a new draft agreement presently under consideration that would create additional areas of land where the First Nations could have various categories of rights. One of these additional areas, which would grant subsurface mineral royalty rights to the First Nations, appears to overlie a portion of the northern Red Wine intrusions. One of Medallion’s Red Wine licenses covers a prospective area of this northern Red Wine intrusion. There is no indication as to when, or if this draft agreement in its present form will be finalized or take effect.
Character of the Red Wine Intrusions
The Red Wine intrusions occur as two major bodies, the North and South Red Wine Plutons, or stocks, and at least eight minor stocks. These unusual rock bodies, which are granitic and peralkaline in composition, were intruded into the older Letitia Lake Group and Arc Lake Intrusive rocks. During the Grenville Orogeny (1,250-980 million years ago), the area of this entire suite of rocks was deformed and metamorphosed into banded gneiss; however, the original peralkaline bodies are still discernable.
Although peralkaline rocks are unusual, there are a number of peralkaline intrusions in Labrador and eastern Canada. Peralkaline signifies that, chemically, the rocks contain less aluminum oxide than the combined oxides of potassium and sodium. Peralkaline rocks are thought to be the result of intrusions of magma from the upper mantel, or the mantel-crust interface.
Peralkaline granite intrusions often contain higher levels of the HREE’s. The high-HREE-bearing Strange Lake peralkaline intrusive complex lies along the Labrador-Quebec border to the north of Red Wine. Kipawa in southwestern Quebec, Pajarita, New Mexico and Bokan Mountain, Alaska in the USA as well as Russia’s Kola Peninsula deposits are other examples of high-HREE-bearing peralkaline deposits.
Eudialyte is the key HREE-bearing mineral at Red Wine and it is often found in peralkaline HREE deposits. It is also the important HREE mineral at Kipawa, Quebec, Pajarita, New Mexico and in the Russian Kola Peninsula deposits. Eudialyte is considered by some REE experts to be the mineral that will eventually supply a major amount of the World’s required HREE’s. Eudialyte is reported to occur commonly throughout most of the Red Wine intrusions. Numerous eudialyte-rich areas of variable size have been identified and some areas run as high as 40% to 60% eudialyte.
Medallion’s HREE Exploration Program
The 2010 Red Wine program consisted of an airborne magnetic and radiometric survey, a reconnaissance mapping and sampling program, a follow-up sampling program and REE mineralogical studies. The exploration work was carried out on all seven claim-group licenses, which occur in four separate claim blocks.
The initial REE target on the property was a large exposed body of previously mapped Red Wine peralkaline intrusive rock, which is known to contain the REE-bearing mineral, eudialyte. While significant eudialyte was identified during the field work and all assayed samples showed elevated levels of REEs, the overall average assays for the eudialyte-bearing rock were lower than expected. Laboratory examination determined a Red Wine eudialyte total REE content of approximately 2.5%, which is low for eudialyte and explains the lower-than-expected REE assays reported for the samples of peralkaline rock.
Although the first target did not return ore-grade assays, the Red Wine peralkaline intrusive complex is clearly a significant occurrence of REEs, which deserves continued, detailed exploration. The low REE content of the eudialyte means that other areas within the Red Wine intrusion, which contain higher levels of eudialyte than the 15% to 20% levels that were encountered last year, must be explored. Historically, much higher eudialyte levels have been reported from the Red Wine intrusion and the planned exploration program for 2011 will include further work in search of these higher levels of eudialyte.
Medallion’s 2010 work encountered at least three types of REE mineralization and, historically, other types have been reported, as well. The 2011 work will focus on evaluating these other types of REE mineralization, which, in the 2010 samples where they were encountered, were much higher grade than the eudialyte-bearing rocks.
Medallion, in order to maintain its option of the licenses, is required during 2011 to issue 200,000 shares to the vendor and perform $200,000 in exploration work. A $200,000 exploration program to advance the Red Wine project to the next phase is in the planning stage. Medallion has sufficient funds on hand to perform this work.
