Completion of Black Angel pre-feasibility study
12/01/2006
Press Release
* Economic case established for re-opening the mine
* Global warming exposes ’massive sulphide’ ore body visible on surface
* Up-side potential to be established by 2006 drilling programme
Angus and Ross plc announces that mining consultancy Wardell Armstrong International (WAI) Limited has completed a pre-feasibility study of the potential of its Black Angel zinc lead project in Greenland, ahead of a planned intense drilling programme in the 2006 season.
Commenting on the report, Chairman Robin Andrews said: ’The report establishes the economic case for re-opening the Black Angel mine. There is further substantial potential in the area and we look forward with anticipation to a successful conclusion to the 2006 exploration programme.’
The study establishes an economic case for reopening of the mine, based on proven mineable ore reserves of 1.7 Mt of 9.7% zinc, 3.1% lead and 21g/t silver contained largely in the pillars of the old mine.
Using current metal prices this base case indicates a commercial project with a Net Present Value of US$52M (using a 10% discount rate) and an IRR of 35%. The study also highlights the potential for finding additional ore in the vicinity of the mine.
If an additional 1.3 Mt of mill feed at similar grades can be identified, this would result in the project NPV increasing to US$189M with an IRR of 56%.
Wardell Armstrong International reports that: ’There are significant and encouraging signs that satellite deposits and mine resources can provide additional ore for extraction. A re-interpretation of the regional geology of Black Angel mine and the South Lakes region may lead to additional tonnage from satellite deposits being sourced. The project has a favourable outlook.’
The company is currently planning a drilling programme in order to delineate the additional tonnage, having the advantage of records from 160,000 metres of previous drilling. The prime targets include a significant outcrop of massive sulphide ore uncovered over the last 15 years as the South Lakes glacier retreated over 250m - a result of global warming - as well as six other showings of ore.
Grab samples from this outcrop returned grades of 32% zinc and 20% lead.
For further information visit the company website www.blackangelmining.com or contact:
Robin Andrews, Angus & Ross plc, 01751 430 988
Neil Boom / Rosemary Acfield, Gresham PR Limited, 020 7404 9000
Notes to Editors:
The Black Angel mine, located on the west coast of Greenland, was active between 1973 and 1990, producing 11M tonnes of high grade zinc, lead and silver ore. An estimated 2.4M tonnes of ore still remains in the mine, much of it in the pillars, from which a high proportion of the ore will be extracted.
The engineering plan by WAI envisages utilising an existing 6 km tunnel from the shipping facility to the Nunngarut satellite orebody connecting to a new 10 km road, in turn leading to a new entrance at the rear of the mine. This access will permit both exploitation of the adjacent satellite orebodies and further exploration of the surrounding area.
The processing technology will allow for separate on-site concentration of the zinc and lead with tailings being put back into the mine, minimizing environmental concerns at the same time as creating additional roof support. Seven main areas with known zinc occurrences have been identified as targets for diamond drilling in the 2006 season.
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