Bluebird Merchant Ventures (EPIC: BMV), the Asian focused resource development group, is pleased to announce that work undertaken at Gubong Mine in South Korea has progressed to the point where the company can start to develop conceptual future production plans.
The main access points to the mine have been selected for further civil work to provide permanent entrances to the project. Whilst data analysis and research is ongoing, sufficient historical data has been analysed that has enabled the Company to develop a 3D model of the Gubong Mine that will form the basis for developing a production plan.
Two major factors which are relevant to this work are old drill hole results on the property and the Resource announced by state owned enterprise, Korean Resources Corporation (KORES) of 2.34Mt @ 7.3g/t . The Company cautions that KORES resource numbers are not JORC resources but also note that the methodology is logical and deals with some aspects required to declare JORC
Historic Drill holes at Gubong
Fifty-seven historic drill holes have been drilled at Gubong and the surrounding areas for a total of 17,715.3 metres. The drilling covers the period from 1968 to 2015; with 3 holes drilled in 1968, 2 holes in 1969, 25 holes in 1989, 12 holes in 1990, 8 holes in 1991, 2 holes in 2004, 1 hole in 2012 and 4 holes in 2015.
Drill hole downhole depths varied from 9m to 950m, with an average depth of 321.8m. All drill holes were drilled by Korea Resources Corporation (KORES), except the 2012 and 2015 drill holes which were drilled by Southern Gold Korea predecessor, Hee Song Metals.
Eighteen drill holes contained significant intersections greater than 1g/t Au, and these are tabled below.
The Company notes that the drill results are very encouraging. The fact that a significant percentage of the holes have returned economic grade is typical for an Orogenic deposit as they are highly variable in mineralisation and intersecting structure is considered almost as important as grade for delineating a successful resource.
The model of the mine that Bluebird has developed shows it to be approximately 2km on dip and 1.5 km on strike. The area under examination has 5 surrounding areas which have further underground workings at various depths.
The main mine is now confirmed at an approximate depth of 500 metres below ground (valley) level. This is encouraging news on two counts; Orogenic Deposits such as Gubong typically exhibit depths of 2km and more, which suggests that there is plenty of scope for extending the resource and future life of the mine. It also means that the future cost of dewatering is reduced considerably from initial expectations.
The Company has selected the upper workings of the mine as the initial target for production as it is above the valley floor and not flooded. Whilst dewatering parts of the mine is not expected to be problematic, access is more easily gained into the dry areas of the mine and dewatering can be achieved from cashflow.
Reopening old mines is considerably cheaper than developing new mines. The Gubong Mine has over 120 kilometres of underground development. In today’s terms this would cost approximately USD3,000 per metre for new development. Additionally, the mine closed in 1971 when the gold price was below US$40/ounce, which means that many areas unmined in those days, due to being unpayable, will now be economic. Over the coming weeks, the Company intends to carry out the civil works to gain permanent entry to the mine and then carry out mapping and sampling work to further develop the mining plan. Following this metallurgical work will commence.
Colin Patterson, CEO, noted that “The mine model that is being developed reveals the enormous size of what was South Korea’s second largest gold mine. The drill results show some exceptionally high grade intercepts which is very encouraging. The fact that the mine closed in a day without any systematic salvage plan suggests that there is significant ore left behind. Gubong is a multiple vein gold mine and as such we certainly expect to substantially increase the life of the mine.”
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 (“MAR”)