Woulfe Mining says assay results from the continuing underground drill program at Sangdong in South Korea will be used to update the resource estimate for the tungsten project.
The latest batch of assay results are from 16 holes with significant intersections including 13.1 metres true width @ 0.60% tungsten including 4.5 metres true width @ 0.85% tungsten, and 6.9 metres true width @ 0.52% tungsten. One hole intersected the Hangingwall Zone with 7.3 metres true width @ 0.35% tungsten.
The drilling program is targeting the un-mined mineralization in the upper section of the mine above the current water level for mine planning and feasibility reserve estimation purposes. This section of the mine has a newly re-estimated indicated resource of 16.4 million tonnes @ 0.45% tungsten and an inferred resource of 19.4 million tonnes @ 0.44% tungsten.
Meantime, Woulfe’s strategic partner IMC has acquired a 25% in the Sangdong mine and will invest Can$70 million to build the APT plant. IMC has signed a Memorandum of Understanding (MoU) with the municipal governments to ensure ‘close cooperation’ for the development of Sangdong.
The governor of Gangwon province and the mayor of Yeongwol county have stated their government authorities will fully support the project with permits, the designation of a foreign direct investment zone and the building of roads and other infrastructure.
Woulfe’s chief executive officer Brian Wesson says “This MoU is of significant importance to us. It follows the definitive feasibility study released by Tetra Tech in which the NPV of Sangdong mine for the first 11.5 years was assessed to be $400.5 million or 46% IRR.”
The feasibility study also concluded the mine would break even in 2.2 years, based on mining 1.2 million tonnes from the Main and Footwall ore bodies above the valley floor and an initial capital cost of $151 million.
“In addition to IMC’s investment, undivided support from relevant governments will assure the successful completion of the Sangdong project and will help us achieve the targeted production of tungsten concentrate and APTs in mid-2013,” said Brian Wesson.
Drilling from underground locations is continuing at Sangdong, which is about 187km southeast of Seoul. It was one of the world’s largest and most renowned tungsten mines before Korea Tungsten closed down operations in 1993 due to falling commodity prices.