The Black Angel project is the main focus of Angus & Ross plc. The objective of the project is to re-open the Black Angel zinc mine in West Greenland and to conduct extensive exploration of its 187 km2 licence area aimed at discovery of a significant zinc/lead orebody (“The New Black Angel”).
In May 2005 the Company commissioned Wardell-Armstrong International to
conduct a pre-feasibility study examining the possibility of re-opening
the mine as well as assessing the exploration potential of the licence
area. The study took over 6 months to complete and included 3 site
visits lasting nearly a month. The mine was subjected to a 5-day
long inspection by a team of 6 experts, including the mine's former
Chief Geologist and former Rock Mechanic.
The study concluded that there is a strong economic case for re-opening the mine and that the likelihood of finding additional ore is high. The main economic indicators from the study are shown in a table below.
|
Tonnes of
ore (mill feed) |
Net Present
Value (10%)* |
NPV/share** |
IRR |
Capex |
| Base Case |
995,000 |
$52m |
33p |
35% |
$38m |
| Improved Case |
2,166,000 |
$189m |
119p |
56% |
$47m |
* prices used Zn=$1950/t and Pb=$1100/t ** assuming 89.9m shares in issue
|
Over 1.7 million tons of ore have been classified as “proven
reserve” according to the JORC standard, with a further 0.6
million in the “probable reserve” category. The grade
of ore would be respectively 9.7% Zn, 3.1% Pb, 21g/t Ag for “proven” and
8.0% Zn, 2.0% Pb, 21g/t Ag for “probable” allowing for
a significant dilution (inclusion of a waste rock) reaching 54%.
This dilution is to be removed by adding a Dense Media Separation
unit at the beginning of processing thus providing the mill with
995,000 tonnes of pure ore containing 17.1% Zn, 5.5%Pb, and 37g/t
Ag.
The "Base Case" assumes that only the pillars from the old mine are
mined, and only those belonging to the "proven" category (i.e. is
based on 1.7m tonnes of ore). The "Improved Case" assumes that in
addition to the pillars new ore is found nearby, that could be processed
together with the ore from the pillars.
Bringing more ore into the “proven” category improves
the economics of the project dramatically (see table). This additional
ore can come from the current “probable” category
and/or from new discoveries. Angus & Ross plc launched a major exploration
programme in 2006 to find the additional ore to meet the target of
the "Improved Case". Find out more about our progress on the Development
Concept page and the Latest
News page.
