Black Angel
15/03/2007
Press Release:
Angus & Ross plc is pleased to
report significant progress towards the goal of re-opening its 100%
owned Black Angel zinc/lead mine on the west coast
of Greenland.
- Cable car access to Black Angel mine to be re-established in
2007 – advancing project by one year;
- Mining planned to start in 2008;
- Project finance discussions well advanced;
- Exploration area recently increased by 38%; and
- Next phase of exploration programme to start in June 2007.
The Black Angel mine, in its time one of the richest by grade, in
the world, closed seventeen years ago with some 2.35 million tonnes
of ore still left in the pillars. Early production from these pillars
is the Company’s principal short-term objective. In 2006 the
Company conducted further exploration on a small part of its 187
sq. km licence culminating in the discovery of a further indicated
and inferred resource of about 2 million tonnes (See
announcement on 6th Dec. 2006) Further development drilling
of these discoveries will take place this year. The Company is working
with its consultants
Wardell Armstrong International on a mining plan
to exploit both the reserves in the mine and the resources outside
it.
A decision has now been taken to re-install an aerial
cable car similar to that which originally ran from the mine portal down to
the mill and mining camp on the other side of the fjord. A Letter
of Intent to purchase a refurbished cable car system has been signed
with the Swiss engineers Garaventa, which built the original installation
for Cominco which previously operated the mine. Garaventa will
be responsible for its installation during the 2007 field season.
This arrangement will enable year-round access to the mine, facilitating
the start of mining operations. The acquisition of a second-hand
cable car system saves nearly a year of construction time as well
as reducing the capital costs.
Discussions are being initiated with several potential customers
in both Europe and North America to ship upgraded ore (a “pre-concentrate”)
from Greenland to concentrators close to existing smelters. This
is fundamental to the objective of achieving early cash flow. A simple
pre-concentrator is likely to be constructed within the mine, which
will overcome the need to build a complete flotation plant on site
at this time. A final decision as to the pre-concentration process
will be made upon completion of metallurgical testing which is currently
underway.
A timetable of work over the next two years includes the following:
2007
- Refurbishment of existing buildings and provision
of power to establish a base camp;
- Completion of metallurgical testing and design
of the pre-concentration plant;
- Installation of refurbished cable car;
- Renovation of remaining equipment in the mine;
- Completion of bankable feasibility study; and
- An extensive drilling and exploration programme
around the new discoveries (Glacier and Ark) to increase resources,
as well as follow up drilling on other discoveries made by Cominco
and Boliden but not previously exploited.
2008
- Installation of aerial conveyor-belt transportation system;
- Construction of main camp;
- Renovation of underground crusher and re-establishing mine services;
- Construction of pre-concentration plant; and
- Move mining equipment into the mine and begin mining operations.
An initial estimate of the capital cost of this work is around $40
million. Discussions are in progress with a number of institutions
that have indicated interest in providing part of the project finance
before a Bankable Feasibility Study has been completed. That they
would be prepared to do so is a reflection of the fact that the ore
remaining in the mine is quantifiable, its metallurgy known, 15 years
of production records are available and that the proposed mining
methods have been tried and tested by the former owners, Cominco and Boliden. However, the board can give no assurances at this
stage that any financing will be successfully concluded.
In recent days the Company has been awarded a further 72
sq km licence
at Ukkusissat, about 20km from Black Angel, which hosts a potentially
large zinc resource first discovered by Cominco in 1979. Many other
exploration targets exist and an aggressive drilling programme will
start in June this year. Details of this programme will be
announced in due course.
Robin Andrews, Chairman of A&R, said:
“I am delighted that we have reached a decision as to the
development of the Black Angel. Entering the mine by cable car allows
us to shorten the time to production and reduce the capital costs.
It also gives us a further year in which to build on last year’s
successful exploration programme before making decisions about construction
of a dedicated mill in Greenland.
Among the attractions of the Black Angel project are the low
geological and metallurgical risk, the location being in a politically
stable and “pro mining” country and being equidistant
to markets in North America and Europe. We are confident that these
advantages will be recognised by financiers and industry partners
with whom we are currently in discussions.”
-Ends-
Angus & Ross
plc
Robin Andrews, Chairman +44-1751 430 988
Andrew Zemek (COO of Angus & Ross, CEO of Black Angel Mining)
+44-7850-755 450
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