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Woulfe Mining (WOF.V) - production decision in 2012 on reopening the Sangdong tungsten mine in South Korea

Full Report by Objective Capital , Apr 15, 2011 download full report
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Key Points:

  • Woulfe is reopening the Sangdong tungsten mine
    Woulfe Mining took control of Korea’s Sangdong tungsten and Muguk gold-silver properties in December 2009 and released a scoping study in March 2010 that envisaged reopening the Sangdong tungsten mine. Prior to closure in 1992, Sangdong was one of the world’s largest tungsten producers, with a reported historical “remnant reserve” of 17 Mt averaging 0.5 % tungsten oxide (WO3).

  • Sangdong hosts a considerable resource
    The scoping study delineates an inferred resource of 103.2 Mt of ore, averaging 0.35% WO3 and 0.04%molybdenum sulphate (MoS2). The study envisaged a full mine recovery programme, including total dewatering of the historic underground workings. Woulfe is presently working on a revised mining plan and is evaluating the previously unmined Sangdong Hangingwall zone which it now plans to mine first.

  • Woulfe has lined up a key strategic partner to advance Sangdong
    Pursuant to a heads of agreement, Korea Zinc invested C$10m into Woulfe at C$0.30. Korea Zinc has also tentatively agreed to inject C$38m into a Woulfe subsidiary, in exchange for a 51% interest in the subsidiary, which holds title to the Sangdong project. This injection of capital will likely now depend on the outcome of a 5,000m drilling programme currently near completion at Sangdong. Concurrently, Korea Zinc has tentatively agreed to invest C$1.8m into a second Woulfe subsidiary in exchange for a 51% interest in the Muguk gold project. In both cases, subsequent to feasibility, Korea Zinc has tentatively agreed to arrange debt financing sufficient to achieve production.

  • Woulfe is fast-tracking Sangdong toward early production
    A full feasibility study is in progress, targeted for completion in late 2011. The current plan is based on the potential contained within the hangingwall infrastucture pillar which traverses the upper portion of the mine. A 5,000-metre drill programme is currently under way in this region, designed to delineate the mineable reserve within this pillar. Mining is formally expected to commence in March 2013, based on the expectation of a satisfactory feasibility study.

  • The Muguk gold project is also being advanced
    Woulfe intends to complete further work on the Muguk gold property this year, including further drilling to upgrade the historic resource. The company has already drilled deep into the old mine to reconfirm historical gold grades. Woulfe also has other properties and projects with a lower priority that remain active.

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