12 March 2019
Bluebird Merchant Ventures Ltd
(the "Company" or "Bluebird")
Kochang Permit to Develop Application Submitted and Gubong Mine Update
Bluebird Merchant Ventures (EPIC: BMV), the Asian focused resource development group, is pleased to announce that the application for the 'permit to develop' the Kochang Mine was submitted on 8 March 2019.
· Application submitted for 'permit to develop' Kochang Mine
· Response to Gubong 'permit to develop' application expected around 23 March
· KORES application success expected in March
Kochang Mine Update
The Kochang Mine area is currently held under the name of Geochang Project Co. Ltd (the Joint Venture company). The application for the 'permit to develop' the Kochang Mine will enable the mine to enter the construction and production phases. The application is a technical document and will be in the public domain for a period of forty working days.
The Kochang Mine previously operated from 1928 to 1975. The gold price at the time of closure was USD140/oz. The area mined was only to a depth of 150 metres. This type of deposit typically extends to one kilometre in depth, which is one indication of the potential of the mine.
KORES grant application update
The Company announced on 6 February 2019 that an invitation was given by the South Korean government owned Korea Resources Corporation ("KORES") to apply for a drilling grant. This application was submitted on 30 January 2019. KORES personnel have undertaken two site visits to review the planned underground drill programme and the Company remains confident that the application will be accepted this month. The purpose of the assisted drilling programme is to support mining activity. The success criteria of the scheme is that the supported programmes result in operating mines.
Gubong Mine Update
The Gubong Mine is currently held in the name of the Joint Venture Company, Gubong Project Co Ltd. An application for a 'permit to develop' the mine was submitted on 23 January 2019. Taking into account the Korean New Year Holidays, the company expects to receive a response around 23 March 2019. Since the application is largely a technical document it would be expected that in the response, clarification may be requested on some issues and the company is confident in responding positively.
The Gubong Mine previously operated from 1908 to 1971. The gold price at the time of closure was USD40/oz. The area mined was to a depth of 500 metres. These type of orogenic deposits typically extend to well over 1.5 kilometres in depth, which is a major factor in determining the potential of the mine. Old drill holes from the 1990s intersected the system a further 250 metres below the bottom of the current workings.
Bluebird remains confident that it will achieve the target previously announced of bringing about production in South Korea during the fourth quarter of 2019.
Charles Barclay, COO, commented:
"We are pleased that development at both Gubong and Kochang is progressing. Our team has extensive experience in reopening old mine workings such as West Rand Consolidated Mines and East Rand Proprietary Mines in South Africa, the Emperor Mine in Fiji, Apex Mine in the Philippines and the Bong Mieu mine in central Vietnam. Typically, such workings were closed for many years and, as is the case with our two projects in South Korea, were mined in days of much lower gold prices, less productive mining and in far less advanced processing eras.
"We also have the advantage of much existing infrastructure in the form of developed tunnels, remnant areas developed but unmined due to pay limits of the day and broken ore not effectively cleared at closure. We also have substantial records on the two mines which were well known in their day. Gubong was the second largest gold mine in Korea for a number of years and Kochang was known for its high grade production"
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 ("MAR")
Bluebird Merchant Ventures Ltd
+44 (0) 7797 859986
Jonathan Morley-Kirk, Non-Executive Chairman
SP Angel Corporate Finance LLP
Smaller Company Capital Ltd
Rupert Williams / Jeremy Woodgate
+ 44 (0) 20 3470 0470
+44 (0) 20 3651 2910
+44 (0) 20 7138 3204
Tim Blythe / Camilla Horsfall / Julia Tilley
Notes to Editors
The Gubong mine was once the second largest producing gold mine in South Korea until its closure in 1971 when gold prices were US$40 per ounce. The mine consists of nine shallow dipping stacked veins. Although production was mainly from vein number six, five other veins were mined from 1928 until its closure. Over 17,000 metres of drilling was carried out over the years and there are over 120 kilometres of existing underground development.
The Kochang mine is a gold-silver mine that operated between 1928 and 1975 and produced over five million ounces of silver at over 1000 g/t and 110,000 ounces of gold at 19.6 g/t. This gold production was mainly derived from the three main veins at the North East end of the "Gold Mine" part of Kochang, with the majority of the silver production from the "Silver Mine" some 2.5 kilometres to the south west. The mine closed in 1975 when the gold price was USD 140 per ounce. Today the mine consists of three steeply dipping veins. Bluebird has opened up three kilometres of original development, taken over 400 samples and has confirmed process viability by carrying out initial metallurgical test work.
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