Access granted to South Korean gold mine
Regulatory approvals enabling access to underground workings at historic high grade Gubong gold mine, south of Seoul Fulfils formal access requirements to enable farm-in partner, London’s Bluebird Merchant Ventures, to proceed with mine redevelopment evaluation Excellent support received from local community representatives and South Korean mining regulators
Gubong Moves Forward
Australian gold producer, Southern Gold, is pleased to advise that its wholly-owned subsidiary, Southern Gold Korea (SGK) has received approval from South Korean mining regulators enabling the re-opening of and access to the historic Gubong underground gold mine.This approval will enable Southern Gold’s development partner, London Stock Exchange-listed Bluebird Merchant Ventures Ltd (‘Bluebird’), to achieve access and begin its process of project assessment under the Farm-In and Joint Venture Agreement signed with Bluebird in March this year (see ASX Release 27 March 2017).
The Gubong Gold Mine was historically South Korea’s second largest gold mine with multiple gold bearing quartz veins being mined over a 60 year period.Bluebird indicates that there is more than 50km of level development accessed by 2 vertical shafts and 6 inclined shafts in what was a substantial mining operation.
Bluebird will now proceed to re-open the mine, conduct preliminary assessment works and complete an evaluation of re-starting operations at the mine.This evaluation will take 6-9 months and cover modern era resource estimation, mining methodology, metallurgical studies, capital and operating cost estimates and financial analysis.
Southern Gold has also been active on community relations and management of regulators more broadly (such as the Mine Safety Office, MIRECO and Mine Registry Office) and has been extremely pleased with the response of the local community and South Korean regulators.
Southern Gold Managing Director, Mr Simon Mitchell:
“Southern Gold believes there is a significant embedded dollar value in this underground development with the existing mining infrastructure providing an opportunity for low capital cost options for a future new mining regime at Gubong.
“We have made great progress at this project, being several weeks ahead of schedule in terms of access approvals. This bodes well for moving the project through the next stages.I think the rate of progress on this front will pleasantly surprise investors.”
Some progress has also been made at the former very high grade Taechang gold mine to the northeast of Gubong, (one of the six main gold projects in South Korea acquired last year by Southern Gold) with preliminary review of data and old mine plans.Initial assessments conclude that Taechang is part of a much broader mineralised district but much of the activity dates to the Second World War and the Japanese occupation era.While Taechang remains the most substantial gold project in the district that Southern Gold is aware of, it may take some additional time to complete assessments compared with the rapid timeframe that has been possible at Gubong.
Southern Gold Limited:Company Profile
Southern Gold Ltd is a successful gold explorer and producer listed on the Australian Securities Exchange (under ASX ticker “SAU”).The Company’s main focus is its Bulong Gold Project located 30 km east of the world renowned gold district of Kalgoorlie (WA) with the flagship Cannon Gold Mine projected to produce around 50koz gold by open pit methods.Mining at Cannon is being conducted by Westgold Resources Ltd, which financed and developed the deposit under a 50/50 profit share arrangement.Westgold is responsible for all mining, haulage and processing activities.
Southern Gold is also exploring at projects such as Glandore, Transfind Extended and Cowarna, looking for additional small high grade open pit-able gold resources and potential new discoveries.
In addition to its cornerstone position in Kalgoorlie, Southern Gold owns a portfolio of high grade gold projects in South Korea.These projects are a combination of decommissioned gold mines with orogenic gold mineralisation and greenfield epithermal gold targets.Southern Gold’s aim is to move one or more of the orogenic gold mines such as Gubong and Taechang into production in the short to medium term utilising the technical expertise of its joint venture partner and London Stock Exchange listed Bluebird Merchant Ventures, as well as explore for world-class epithermal gold deposits.
Some statements in this release regarding estimates or future events are forward looking statements.These may include, without limitation:
- Estimates of future cash flows, the sensitivity of cash flows to metal prices and foreign exchange rate movements;
- Estimates of future metal production; and
- Estimates of the resource base and statements regarding future exploration results.Such forward looking statements are based on a number of estimates and assumptions made by the Company and its consultants in light of experience, current conditions and expectations of future developments which the Company believes are appropriate in the current circumstances.Such statements are expressed in good faith and believed to have a reasonable basis.However the estimates are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from estimated results.All reasonable efforts have been made to provide accurate information, but the Company does not undertake any obligation to release publicly any revisions to any “forward-looking statement” to reflect events or circumstances after the date of this presentation, except as me be required under applicable laws. Recipients should make their own enquiries in relation to any investment decisions from a licensed investment advisor.