Bluebird Merchant - Kochang Permit Approval
Bluebird Merchant Ventures Ltd
(the "Company" or "Bluebird")
Kochang Permit Approval
· Kochang Permit Approval
· Low capex with initial gold production opportunity in 2020
· Organic growth potential from 10,000 to 30,000 oz of gold per annum over 3 years
· Non-dilutive debt funding discussions
The permit grants the holder the right to develop and operate a mine for a period of 13 years. The only constraint on the permit holder is the requirement to have production within 3 years. The permit may be extended by a further 20 year period by application 18 months prior to the end of the permit term. There are no government royalties in
The grant of this permit by the
The two projects have differing qualities which give the company much opportunity for flexibility. Whilst both mines operated in similar timeframes and closed in the 1970's when the gold price was still below
On the other hand Kochang, is very shallow (only mined to 150 metres below surface on 1 vein). It has 3 identified steep veins and has potential to expand operations to the southwest/northeast along strike and to depth as well as exploiting the already mined areas. Indeed, the vein system has been identified and mapped on surface where no mining has ever taken place. The overall strike length of the system is approximately 3 kilometres.
Both mines have geological systems which generally extend to 1500 metres in depth. Initial production from both of the mines will come from sources which are the result of many years of previous mining. Because gold grades vary across any mine it is natural that some parts of a mine will return a profit at a particular gold price and other areas will not. It is for this reason that parts of the mine will remain unmined. In the case of our two mines many areas were left unmined due to a much lower gold price (<
The Gubong and Kochang projects are a 50:50 contributing joint venture with Southern Gold. The Joint Venture is managed by Bluebird. Over the next 3 to 4 months, Bluebird will be entering the heart of the Gubong mine where the original incline shaft systems commenced. This will involve some community work and dewatering which is merely draining the area and treating the water before release. The system was trialed successfully at the beginning of this year. Subsequent to this the tunnels will be explored, sampled and surveyed in order to build up an inventory of product.
From February, the projects will then progress to production with initial mining commencing in 6 months and gold production some 3 months later. Both mines will continue to expand their mining area and build up inventory whilst the process plant design is completed and constructed. Estimated average cash cost per ounce (C1 level) is
Commencing next year, Bluebird will start an in-depth feasibility to determine the optimum size for expansion beyond 2022. This will include on and near mine exploration, JORC resource determination. The main targets for this program will be the deepening of both mines.
"Despite getting our two permits faster than any other country I know of it has been a lengthier process than we first anticipated. This is now over and we are excited by the prospect of achieving gold production in the coming year. We trust that our shareholders will enjoy a revaluation of the company as we move forward."
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 ("MAR")
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Notes to Editors
The Gubong mine was once the second largest producing gold mine in
The Kochang mine is a gold-silver mine that operated between 1928 and 1975 and produced over five million ounces of silver at over 1000 g/t and 110,000 ounces of gold at 19.6 g/t. This gold production was mainly derived from the three main veins at the North
This information is provided by RNS, the news service of the
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Market Cap: £7.01 m
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