Elemental Minerals Ltd. - Review of operations for the quarter ended 31st March 2012

PERTH, Australia, April 30, 2012 /CNW/ - Elemental Minerals Ltd. (ASX, TSX: ELM) ("Elemental" or "the Company") is pleased to provide the following quarterly update.

ACTIVITIES

• 16 boreholes (4843.59m) were drilled during the quarter for resource infill and expansion and the hydrological testing programme.
  
  
• Continued with engineering studies on the process plant, infrastructure components and mine design.
  
  
• Received approval or the Terms of Reference for the environmental and social impact assessment from the Republic of Congo ('ROC') government regulators and continued with baseline assessments.
  
  
• Upgrade of field camp to 150 personnel.

Pre-Feasibility Study and Phase 2 Exploration Programme

The Company continued with the pre-feasibility phase of its definitive feasibility study ("DFS") for the Sintoukola potash project this quarter. The Phase 2 resource drilling was completed. 12 boreholes (3,914 metres) were drilled to bring the final total to for Phase 1 and Phase 2 resource holes to 36 (11,954 metres). Some of these boreholes also served to provide geotechnical samples and data for the PFS.

An additional 4 boreholes (930 metres) were drilled for hydro-geological purposes during the quarter to provide data for the Company's PFS. A further 3 holes are in progress and planned to complete this phase of hydrological study.

Resource boreholes completed during the Quarter with intersections reported are given in Table 1.

Sampling and Analyses

Drill core samples (PQ core diameter sizes) are split in half by a diamond saw cutting machine at the project site. The half split samples, each weighing about three to seven kilograms, are collected at an average interval of 0.3 to 1.0 metre. The samples were processed and analysed by Genalysis, Perth, Australia. Sample preparation and analysis is done by Genalysis. Potassium, Sodium, Calcium, Magnesium, Chlorine, and Sulphur were analysed by ICP-ES. Routine international-standard QA/QC procedures were used by Genalysis. One of the six elements analysed are reported here: potassium (K) and its molecular equivalent of Potassium oxide (K₂O, by multiplication with a factor of 1.204). The detection limit for K is 0.001%.

Table 1. Drill hole intersections reported during the Quarter. In EK_21 and EK_30 the borehole failed above the expected seam intersection. Complete sample submission for EK_22, EK_24, EK_28  pending. In EK_25 no seam was intersected.

Table 2. Drillholes completed during the Quarter. In EK_21 and EK_30 the borehole failed above the expected seam intersection. Complete sample submission for EK_22, EK_24, EK_28 and EK_32 to EK_36  pending. In EK_25 no seam was intersected.

Pre-Feasibility Trade-Off Studies

The study team consisting of Elemental staff, SRK Consulting, AMEC Americas and EGIS International advanced the Pre-Feasibility study, with good progress having been achieved in the following areas.

Geotechnical study: The field geotechnical drilling and logging was completed. Laboratory testing and engineering characterization was completed. 2D finite element analysis is in progress to determine mine design criteria.

Hydrogeological study: Piezometer testing on 10 hydrogeological holes was completed by SRK (US) during January and February 2012. The drilling and equipping of two well sets each comprising 4 holes was partially completed during February and March. Preliminary evaluation of the results obtained from well site A started, using numerical ground water modeling. Five day pump test was started on well site B and a short term airlift tests was completed on this site. Further slug testing and completion of additional wells at each well site will continue into the 2^nd Quarter.

Mining: Preparation work for the PFS mining study continued in anticipation of issuing the resource upgrade in Q2, 2012. Further definition of the shaft design, ventilation design, panel design and equipment selection was achieved. The impact of exclusion zones was assessed on a preliminary basis. The mining cost estimate was advanced.

Processing: Amec has revised the mass balance, process flow diagrams, 3D modeling and general layouts based on a decision to reduce the feed grade to 23.3%K2O as a consequence of mining the full upper seam.  Process flow diagrams were adjusted to allow for a twin stream design. A trade off study was completed on the final plant position, considering the coastal topography and it was recommended to have the complete plant and offloading facilities on the coastal plane. This allowed the site layout to be finalized. Another trade off study was completed on various ROM storage options.

Preparation was done for the final estimating and an additional test program was initiated to conduct mineralogical characterization and liberation analysis on the US2 material.

Tailings storage facility: SRK (Perth) completed site selection of the TSF and commenced with design of the TSF site.

Infrastructure: Study work continued on the following disciplines:

• All marine facilities including jetty loading facility, material handling system, breakwater design, shipping and barging, berthing and mooring and navigational aids.
  
  
• Road alignments and trucking studies.
  
  
• Brine transmission and dispersion modelling.
  
  
• Water supply, power and gas supply.
  
  
• Surface and employee facility design.
  
  
• Aggregate supply options and strategy.
  
  
• Initiated the Feasibility phase bathymetric survey and metocean studies.
  

Basic designs were completed and estimation is underway.

Environmental and Social Impact Assessment: The following activities have been completed as part of the environmental and social impact assessment studies, which are managed by SRK Consulting:

• Submission and approval of Terms of Reference for the environmental and social impact assessment baseline studies
  
  
• Site visits for the following baseline studies:
  
• Social and indigenous people
  
  
• Biodiversity
  
  
• Cultural heritage
  
  
• Natural Resource use
  
  
• Marine biodiversity

Project Management: In preparation of the estimating phase, work has proceeded on final definition of the Work Breakdown Structure, estimating methodology and economic modelling requirements.

About Elemental Minerals

Elemental Minerals Limited is an advanced mining exploration and development company that aims to grow shareholder value through its 93%-owned Sintoukola Potash Project on the Republic of Congo coastline.  Elemental Minerals is dual listed on the Australian Stock Exchange and the Toronto Stock Exchange under the symbol ELM. For more information, visit www.elementalminerals.com

Mineral Resource Summary - Kola Deposit of Sintoukola Project

• The Sintoukola Project's Kola deposit currently contains 362 Mt Indicated Mineral Resources and 442 Mt Inferred Mineral Resources, with an average grade of 19.5% K₂O (30.8% KCl) and 19.6% K₂O (31.0% KCl) respectively, at a 15.0% K₂O cut-off grade.
  
  
• Within such Mineral Resources, the upper seam of the Kola deposit contains 229 Mt Indicated Mineral Resources and 289 Mt Inferred Mineral Resources, grading at 21.3% K₂O (33.8% KCl) and 21.4% K₂O (33.9% KCl) respectively, which upper seam is a higher-grade sylvinite only zone.
  
  
• The upper seam has a high-grade domain containing 151 Mt Indicated Mineral Resources and 186 Mt Inferred Mineral Resources, grading at 25.1% K₂O (39.7% KCl) and 25.2% K₂O (40.0% KCl) respectively, at a 20.0% K₂O cut-off grade of pure sylvinite in a largely continuous mineralized horizon. This deposit is contained within 28 km² of the current 1,400 km² license area and current exploration activities aim to test a much larger area of the license to further expand resources.
  
  
• The Mineral Resources are reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves 2004 Edition (The JORC Code), which is consistent with Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards 2005 and hence complies with NI 43-101.

Competent Person / Qualified Person Statement:

Information in this report that relates to Exploration Results or Mineral Resources is based on information compiled by Simon Dorling and Jeff Elliott, of CSA Global Pty Ltd, the Company's geological consultants. Dr. Dorling and Mr. Elliott are members of the Australian Institute of Geoscientists (MAIG) and have sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity they are undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (the JORC Code). Dr. Dorling and Mr. Elliott are also Qualified Persons for the purposes of Canadian National Instrument 43-101 and they consent to the inclusion in this report of the Information, in the form and context in which it appears.

Forward-Looking Statements:

This review of operations contains statements that are "forward-looking". Generally, the words "expect," "potential", "intend," "estimate," "will" and similar expressions identify forward-looking statements. By their very nature, forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, to differ materially from those expressed or implied in any of our forward-looking statements, which are not guarantees of future performance. Statements in this review of operations regarding the company's business or proposed business, which are not historical facts, are "forward looking" statements that involve risks and uncertainties, such as resource estimates and statements that describe the company's future plans, objectives or goals, including words to the effect that the company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made.

Image with caption: "Figure 1: Location of Sintoukola Potash License (CNW Group/Elemental Minerals Limited)". Image available at: http://photos.newswire.ca/images/download/20120430_C2260_PHOTO_EN_12855.jpg

Image with caption: "Figure 2: Kola Phase 2 Drill Map showing progress to end Quarter 1, 2012. (CNW Group/Elemental Minerals Limited)". Image available at: http://photos.newswire.ca/images/download/20120430_C2260_PHOTO_EN_12856.jpg