SGQ begins downstream Niobium and rare earths study

Published 05-MAR-2025 11:31 A.M.

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Today our Brazilian niobium and rare earths Investment St George Mining (ASX: SGQ) has taken a significant step forward in its Araxa Project development by commencing metallurgical testwork on niobium and rare earth element (REE) mineralisation.

“Metwork” like this is essential to proving up the long-term commercial viability of significant projects such as the one that SGQ has in Brazil.

If SGQ is able to establish good recoveries of valuable niobium and rare earths, these metrics can then feed into economic studies on the project, to secure financing, begin construction, and ultimately take the project into production.

Here are the key points from today’s SGQ announcement:

Three large representative samples (>60 kg each) from different lithological units selected for bench-scale testing
Samples represent saprolite, clay-like, and lateritic units with grades up to 2.9% Nb2O5 and 14.2% total rare earth oxides
Testing conducted in collaboration with Brazilian scientific agencies EMBRAPII and SENAI
Initial scope includes screening, grinding, magnetic separation, desliming, and flotation steps
First results expected in Q2 2025

Why This News Matters

We think this metallurgical testwork is a crucial step in St George Mining's journey to potentially becoming a significant player in the niobium and REE market. The Araxa Project's strategic location and high-grade mineralization position it as a promising asset in the critical minerals sector.

The testwork aims to develop a flowsheet for potential commercial production, bringing the company closer to its goal of establishing a mining operation.
With only ~10% of the project area drilled so far and mineralization open in all directions, successful metallurgical results could unlock significant value in the unexplored portions of the project.
The high grades (up to 2.9% Nb2O5 and 14.2% TREO) in the test samples underscore the project's potential to be a low-cost, high-grade producer of critical minerals.

Read more on what we expect SGQ to achieve in the coming months in the note below:

SGQ next door to multi-billion dollar niobium producer - here’s what to expect next

This metwork is being conducted in collaboration with Brazilian scientific agencies EMBRAPII and SENAI.

SGQ’s relationship with these agencies was previously established in January of this year:

SGQ signs niobium and rare earths tech agreement - with development in mind

How does this impact our SGQ Investment Memo?

Objective #3: Maiden JORC resource estimate & met testwork

We want to see SGQ define a maiden JORC resource for its project. As part of the resource estimate we also want to see SGQ run some metallurgical testwork and confirm its project sits on similar geology to CBMM’s project next door AND that it can be processed using similar processing techniques.

Milestones

🔄 Metwork updates
🔲 Maiden JORC resource estimate

Source: 6 August 2024 SGQ Investment Memo

What’s next for SGQ?

🔄5,000m Drilling program

With the acquisition complete SGQ will commence its 5,000m drill program next month.

Maiden JORC Resource

SGQ is scheduled to publish a maiden JORC-compliant resource next month.

We mentioned earlier that a 2012 Preliminary Economic Assessment (PEA) for SGQ’s project used a ~27Mt resource with rare earths grades ranging from 3.99% to 5.01% and niobium grades from 0.64% to 1.02%.

This isn't currently JORC compliant but we think that if SGQ can declare anything remotely close to this, it will more than justify SGQ’s current market cap.

For context - WA1 Resources has a market cap of ~$900M and a JORC inferred resource of ~200mt at 1% niobium.

(That values WA1 at ~$4.5M per tonne of JORC resource)

Beyond these two catalysts, we are also looking forward to the project being progressed from a permitting perspective & from a funding/offtake perspective: