Bluebird Merchant Ventures (BMV) has completed its farm-in commitment into the reopening of South Korea’s Kochang mine.
Colin Patterson, CEO, commented: "The company is highly satisfied with the progress made at Kochang. It appears to us to be a mine with great potential and we look forward to the formation of the Joint Venture and to publishing some of the very encouraging results from our work in the last year.”
The company was required to place AUD250,000 into its Joint Venture partner and spend a minimum of USD250,000 on the feasibility report for the mine reopening.
It expects to present its feasibility report to its Joint Venture partner, ASX listed Southern Gold, within the next five weeks.
Earlier in the year it had located the lowest level of the silver workings (which were abandoned 45 years ago), which reportedly produced some 5 million oz of silver before its closure in 1975.
This is core to Bluebird’s strategy whose management team has substantial experience in re-opening old underground mines. Refurbishing mines are usually far cheaper than developing a new mine, risky exploration costs are avoided, and past production/project economics are known.
Bluebird is also carrying out works to re-open the Gubong mine, which is believed to have been the second largest gold mine in South Korea. The company has competed the feasibility report, scheduling production to begin in Q4 of 2019.
Commenting on the project, Patterson, said: "The report on the feasibility of reopening the Gubong mine has further bolstered our expectations for the project. We continue to expect that first gold will be produced at Gubong in the fourth quarter of next year and that output can be increased to 100,000oz per annum within five years."
He added “Gubong has all the makings of becoming a 'company maker' and we look forward to advancing the project towards our production goals."
Rated Aa2 and AA by Moodys and Standard & Poors, South Korea is a very supportive jurisdiction, with enthusiastic local governments, no royalties and partial state funding for environmental projects. The Gubong mine closed in 1970, at a time when the gold price was US$40 per oz, compared to US$1230 today.
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