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MBAC reports NI 43-101 resource estimate update for Araxa Rare Earth Oxide/Niobium/Phosphate Deposit

June 19, 2012

TSX: MBC
OTCQX:MBCFF
Shares Outstanding:110,926,614
Fully Diluted:120,044,030

TORONTO, June 19, 2012 /PRNewswire/ – MBAC Fertilizer Corp. (“MBAC” or the “Company”) (TSX:MBC and
OTCQX:MBCFF)
is very pleased to report the results of an independent resource
estimate update for the rare earths oxides on the Company’s 100% owned
Araxá Rare Earth Oxide (“REO”)-Niobium-Phosphate Project (the “Araxá
Project” or the “Project”) located in the western part of Minas Gerais
State, Brazil. The Company will file a technical report containing the
updated mineral resource estimate on SEDAR within the next 45 days
pursuant to National Instrument 43-101.

Highlights of the NI 43-101 Technical Report:

        --  An independent mineral resource has been estimated for the
            Araxá Project comprising a combined measured and indicated
            mineral resource of 6.34 Mt at 5.01% TREO (using a 2% TREO
            cut-off), 8.40% P2O5 and 1.02% Nb2O5.
        --  An inferred mineral resource of 21.94 Mt at 3.99% TREO, 7.86%
            P2O5 and 0.64% Nb2O5 has been estimated for the Araxá Project
            (using a 2% TREO cut-off grade)
        --  Heavy rare earth oxides (HREO) + Y2O3 represent 2.4% of the
            TREO in the resources
        --  Lab tests for the acid leaching process show an average 85%
            recovery to produce a high quality REO bulk concentrate

Antenor Silva, Vice Chairman and CEO, stated “These results confirm our expectations that the Araxá deposit is a
significant resource base of rare earth
oxides, with a high grade compared to other deposits globally. Also, the
laboratory testwork performed to date indicates that it is possible to
achieve recoveries averaging 85% for the HREO. MBAC is planning to
prepare a preliminary economic assessment for the Project, which is
expected to be released in Q3 2012, and to put in place a pilot plant
to confirm our laboratory estimates and high purity rare earth oxide
concentrate. We are very excited with these results and continue to
discuss off-take agreements with third parties.” 

The Araxá Project

The Project consists of four tenements covering 214 hectares. The
Barreiro carbonatite containing the Araxá REO is also the host rock for
a nearby niobium mine owned by Companhia Brasileira de Metalurgia e
Mineração (CBMM) and a significant phosphate mine owned by VALE. 
Historical exploration from the Araxá Project has led to the discovery
of significant rare earth oxides, phosphate and niobium mineralization.
Phosphate occurrences in the carbonatite were first discovered in the
early 1950′s and the tenement areas optioned to MBAC have been explored
in the past by the following companies:

        --  1965 by DNPM/Geosol
        --  1965 by IPR
        --  1970 by CBMM
        --  1974 by Rhône-Poulenc
        --  2004 by Extramil
        --  2008 Joint Venture between Extramil and CIF

Summary of the Mineral Resource Estimate

The Araxá Project measured, indicated and inferred mineral resource
estimates are based on 67 diamond holes (3,764m) drilled at a spacing
of approximately 40m by 40m down to 20m by 20m within the centre of the
deposit.

The main REO mineralization has been defined by historical drilling
within a 650m by 250m target, and is derived from the residual
enrichment of a REO rich protolith, possibly a carbonatite. Florencite,
Goyazite, Gorceixite and Monazite are the principal REO minerals
present, and apatite is by far the most common and important phosphate
mineral in the Araxá Carbonatite.

Andes Mining Services (“AMS”) is of the opinion that the Company has
successfully confirmed the mineral resource potential of the Araxá
Project based on the exploration programs to date with significant
further upside for additional measured and indicated resources.

An independent mineral resource has been estimated for the Araxá Project
comprising a combined measured and indicated mineral resource of 6.34
Mt at 5.01% TREO (using a 2% TREO cut-off), 8.40% P(2)O(5) and 1.02% Nb(2)O(5) and an inferred mineral resource of 21.94 Mt at 3.99% TREO, 7.86% P(2)O(5) and 0.64% Nb(2)O(5) (using a 2% TREO cut-off grade). Thorium and Uranium content were 632
ppm and 142 ppm, respectively, which the Company believes should not
pose any issues with respect to the processing of the ore.

A summary of the estimated measured, indicated and inferred mineral
resources for the Araxá Project is provided below in Table 1. The
mineral resource estimate has focused on the main oxide mineralization
within a flat lying mineralized domain defined down to approximately
60m in depth using a 1% TREO grade cut-off to guide the wireframing
process.

The statement has been prepared by Bradley Ackroyd (MAIG (CP)), who is a
qualified person within the meaning of National Instrument 43-101. The
effective date for the mineral resource estimate is June 1, 2012. AMS
and MBAC are not aware of any factors (environmental, permitting,
legal, title, taxation, socio-economic, marketing, political, or other
relevant factors) that may materially affect the mineral resource
estimate.

     _____________________________________________________________
    |                    Table 1 - Araxá Project                  |
    |     Mineral Resource Grade Tonnage Report - 1stJune 2012    |
    |  (Block Model - 10mE X 10mN X 2mRL) - Ordinary Kriging (OK) |
    |_____________________________________________________________|
    |Cut-Off |Tonnes|TREO |LREO |HREO|P2O5 |Nb2O5|Al2O3|   Fe2O3  |
    |(% TREO)| (Mt) |  %  | % * |% **|  %  |  %  |  %  |     %    |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |                          Measured Resource Category         |
    |_____________________________________________________________|
    |     0  | 1.33 |5.62 |5.48 |0.15|7.89 |1.25 |3.31 |   34.23  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     2  | 1.33 |5.62 |5.48 |0.15|7.89 |1.25 |3.31 |   34.23  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     4  | 1.10 |6.05 |5.89 |0.16|7.84 |1.32 |3.42 |   34.57  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     6  | 0.37 |8.46 |8.23 |0.23|9.13 |1.72 |5.18 |   33.97  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     8  | 0.16 |10.47|10.18|0.29|9.87 |1.99 |6.00 |   31.44  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |    10  | 0.08 |12.19|11.85|0.34|10.42|2.20 |5.98 |   28.58  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |                         Indicated Resource Category         |
    |_____________________________________________________________|
    |     0  | 5.02 |4.85 |4.73 |0.12|8.54 |0.96 |5.68 |   32.76  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     2  | 5.02 |4.85 |4.73 |0.12|8.54 |0.96 |5.68 |   32.76  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     4  | 3.29 |5.58 |5.44 |0.14|8.69 |1.07 |5.69 |   32.36  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     6  | 0.88 |7.75 |7.57 |0.19|10.25|1.35 |8.17 |   29.32  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     8  | 0.27 |9.88 |9.64 |0.24|11.28|1.67 |8.95 |   28.79  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |    10  | 0.10 |11.73|11.44|0.29|11.83|1.98 |8.66 |   29.38  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |Measured and Indicated Mineral Resource (2% Cut-Off TREO) ***|
    |_____________________________________________________________|
    |     2  | 6.34 |5.01 |4.88 |0.13|8.40 |1.02 |5.19 |   33.06  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |                          Inferred Resource Category         |
    |_____________________________________________________________|
    |     0  |23.99 |3.88 |3.78 |0.11|7.89 |0.62 |4.28 |   29.28  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     2  |21.94 |3.99 |3.88 |0.11|7.86 |0.64 |4.31 |   29.59  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     4  | 9.32 |5.01 |4.89 |0.12|7.64 |0.81 |4.46 |   31.56  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     6  | 1.01 |6.95 |6.82 |0.13|8.93 |0.99 |4.93 |   29.05  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |     8  | 0.14 |9.08 |8.97 |0.12|10.01|1.01 |4.17 |   24.45  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |    10  | 0.02 |10.84|10.70|0.14|10.95|1.16 |4.98 |   22.15  |
    |________|______|_____|_____|____|_____|_____|_____|__________|
    |          Inferred Mineral Resource (2% Cut-Off TREO) ***    |
    |_____________________________________________________________|
    |     2  |21.94 |3.99 |3.88 |0.11|7.86 |0.64 |4.31 |   29.59  |
    |________|______|_____|_____|____|_____|_____|_____|__________|

Mineral resources are not mineral reserves and do not have demonstrated
economic viability

Appropriate rounding has been applied to the table

TREO includes La(2)O(3), Ce(2)O(3), Pr(2)O(3), Nd(2)O(3), Sm(2)O(3), Eu(2)O(3), Gd(2)O(3), Tb(2)O(3), Dy(2)O(3), Ho(2)O(3), Er(2)O(3), Tm(2)O(3), Yb(2)O(3), Lu(2)O(3) and Y(2)O(3)
*LREO (97.6% of TREO) includes La(2)O(3), Ce(2)O(3), Pr(2)O(3), Nd(2)O(3) and Sm(2)O(3)
**HREO + Y(2)O(3) (2.4% of TREO) includes Eu(2)O(3), Gd(2)O(3), Tb(2)O(3), Dy(2)O(3), Ho(2)O(3), Er(2)O(3), Tm(2)O(3), Yb(2)O(3), Lu(2)O(3) and Y(2)O(3). 

The following Table 2 and Table 3 highlight the breakdown for the
various REO’s for the Araxá Project.

     _______________________________________________________
    |                          Table 2                      |
    |      Suite of LREO Mineral Resource @2% TREO cut-off  |
    |_______________________________________________________|
    |         |Cut-Off %|          Suite of LREO's    |     |
    |Category |  TREO   |_____________________________|LREO |
    |         |         |La2O3|Ce2O3|Pr2O3|Nd2O3|Sm2O3|     |
    |_________|_________|_____|_____|_____|_____|_____|_____|
    |Measured |    2.0  |1.53%|2.81%|0.26%|0.79%|0.08%|5.48%|
    |_________|_________|_____|_____|_____|_____|_____|_____|
    |Indicated|    2.0  |1.35%|2.40%|0.22%|0.67%|0.07%|4.73%|
    |_________|_________|_____|_____|_____|_____|_____|_____|
    |Inferred |    2.0  |1.12%|1.96%|0.18%|0.55%|0.06%|3.88%|
    |_________|_________|_____|_____|_____|_____|_____|_____|

Mineral resources are not mineral reserves and do not have demonstrated
economic viability

Appropriate rounding has been applied to the table

     __________________________________________________________________________________
    |                                              Table 3                             |
    |                          Suite of HREO Mineral Resource @2% TREO cut-off         |
    |__________________________________________________________________________________|
    |         |       |                        Suite of HREO's (ppm)        |    |     |
    |Category |Cut-Off|_____________________________________________________|____|HREO |
    |         | %TREO |Eu2o3|Gd2o3|Tb4o7|Dy2o3|Ho2o3|Er2o3|Tm2o3|Yb2o3|Lu2o3|Y2o3|(ppm)|
    |         |       |     |     |     |     |     |     |     |     |     |    |     |
    |_________|_______|_____|_____|_____|_____|_____|_____|_____|_____|_____|____|_____|
    |Measured |   2.0 | 182 | 371 |   38| 153 |  22 |  44 |   3 |  23 |   1 |622 |1463 |
    |_________|_______|_____|_____|_____|_____|_____|_____|_____|_____|_____|____|_____|
    |Indicated|   2.0 | 158 | 322 |   33| 129 |  18 |  36 |   2 |  18 |   1 |502 |1217 |
    |_________|_______|_____|_____|_____|_____|_____|_____|_____|_____|_____|____|_____|
    |Inferred |   2.0 | 135 | 275 |   29| 117 |  16 |  32 |   2 |  16 |   0 |459 |1080 |
    |_________|_______|_____|_____|_____|_____|_____|_____|_____|_____|_____|____|_____|

Mineral resources are not mineral reserves and do not have demonstrated
economic viability

Appropriate rounding has been applied to the table

Mineral Processing and Metallurgical Testing

The long history of exploration of this area combined with recent
metallurgical testwork performed by MBAC, along with the support of
relevant research institutes in Brazil, suggests that the Araxá ore is
suitable for economical processing and will produce high purity REO
products.

MBAC has engaged in laboratory testwork to define a technological route
for the rare earth elements recovery. These tests included alkaline
digestion, hydrochloric acid leach, nitric acid leach, ammonium
chloride fusion and sulphuric leach.  The acid leach followed by salt
precipitation returned the best recovery which averaged 85%.

MBAC is preparing to put a pilot plant in place to test this acid
leaching route, and following that a pilot plant for separation of some
of the oxides with solvent extraction technology.

Qualified Persons

The “qualified person”, within the meaning of National Instrument
43-101, with respect to the technical information in this press release
is Bradley Ackroyd, (MAIG (CP)), of AMS.

About MBAC

MBAC is focused on becoming a significant integrated producer of
phosphate and potash fertilizers in the Brazilian and Latin American
markets. MBAC has an experienced team with significant experience in
the business of fertilizer operations, management, marketing and
finance within Brazil. In October 2008, MBAC acquired Itafós Mineração
Ltda, which consisted of a phosphate mine, a mill and plant and related
infrastructure, all located in central Brazil. MBAC’s exploration
portfolio includes a number of additional exciting phosphate and potash
projects, which are also located in Brazil. The Santana Phosphate
project is a high grade phosphate deposit located in close proximity to
the largest fertilizer market of Mato Grosso State and animal feed
market of Pará State. The Company continues to search for additional
fertilizer opportunities in the Brazilian and other Latin-American
markets, where strong agricultural fundamentals and unique
opportunities are expected to provide attractive growth opportunities
in the near future. Further information on MBAC can be found on the
Company’s website at www.mbacfert.com and on SEDAR at www.sedar.com.

Antenor Silva
President & Chief Executive Officer

FORWARD LOOKING STATEMENTS

This press release contains “forward-looking statements” within the
meaning of applicable Canadian securities legislation. Forward-looking
statements include, but are not limited to, statements related to
activities, events or developments that the Company expects or
anticipates will or may occur in the future, including, without
limitation, statements related to the Company’s business strategy,
objectives and goals; exploration of the Arax
á Project; the completion the updated mineral resource estimate and the
filing of an updated technical report for the Project; the completion
of a preliminary economic assessment and the possibility of entering
into off-take agreements in connection with the Project.
Forward-looking statements are often identified by the use of words
such as “plans”, “planning”, “planned”, “expects” or “looking forward”,
“does not expect”, “continues”, “scheduled”, “estimates”, “forecasts”,
“intends”, “potential”, “anticipates”, “does not anticipate”, or
“belief”, or describes a “goal”, or variation of such words and phrases
or state that certain actions, events or results “may”, “could”,
“would”, “might” or “will” be taken, occur or be achieved.
Forward-looking statements are based on a number of factors and
assumptions made by management and considered reasonable at the time
such statements are made, and forward-looking statements involve known
and unknown risks, uncertainties and other factors may cause the actual
results, performance or achievements to be materially different from
those expressed or implied by the forward-looking statements. Such
factors include, among others, obtaining all necessary licenses to
continue to explore and develop the project; successful negotiation
with third parties to develop the Nb-REE area of the project;
successful completion of a preliminary economic assessment for the
Project; as well as those factors disclosed in the Company’s current
Annual Information Form and Management’s Discussion and Analysis, as
well as other public disclosure documents, available on SEDAR at
www.sedar.com. Although MBAC has attempted to identify important
factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there
may be other factors that cause actions, events or results not to be as
anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate. The
forward-looking statements contained herein are presented for the
purposes of assisting investors in understanding the Company’s plan,
objectives and goals and may not be appropriate for other purposes.
Accordingly, readers should not place undue reliance on forward-looking
statements.

 

SOURCE MBAC Fertilizer Corp.


Source: PR Newswire