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<strong>TAM</strong> <strong>Cover</strong>_<strong>Layout</strong> 1 4/21/11 2:52 PM Page 1<br />
May/June 2011 | Volume 8 | Issue 3 | Industry Technical Information | 矿 业 技 术 信 息<br />
东 南 亚 崛 起 SOUTH<br />
EAST <strong>ASIA</strong> RISES<br />
澳 洲 小 型 勘 探 公 司 • 聚 焦 渣 浆 泵<br />
Australian junior explorers • Spotlight on slurry pumps
IFC_<strong>Layout</strong> 1 4/21/11 2:58 PM Page 1
TOC_<strong>Layout</strong> 1 4/21/11 2:52 PM Page 1<br />
FEATURES<br />
Australian Junior Explorers Australian junior companies are leading exploration efforts in Australia as well<br />
as throughout the Asia Pacific region. This feature examines a number of these companies and the exploration<br />
they are undertaking. ..................................................................................................................70<br />
Slurry Pumps Plant operators, pump suppliers and researchers continue to pursue higher efficiency and<br />
reliability in slurry transport applications ................................................................................................77<br />
LEADING DEVELOPMENTS<br />
Asian Intelligence <strong>The</strong> Fukushima nuclear reactor challenges from earthquake and tsunami hit northeast<br />
Japan should be viewed in full perspective and not as ‘another Chernobyl’. .......................................... 4<br />
Exploration Bauxite Resources has signed a joint venture with China’s Yankuang Corporation to explore<br />
for bauxite in the Darling Ranges of Western Australia. ........................................................................88<br />
AROUND THE REGION<br />
Vietnam Vietnam's fledgling mining industry can play a major role in the nation's growth. ......................6<br />
Laos Additional drilling has started at Ord River Resources Yuqida bauxite tenement. ..........................12<br />
Cambodia Mining represents many opportunities but there has been little exploration. .........................16<br />
Thailand Exploration work has re-commenced on Southeast Asia’s licences. ......................................22<br />
Malaysia Commissioning of Peninsular Gold’s Raub project is expected this quarter. ..........................25<br />
Mongolia A new joint venture is examining four potential sites for rare earth deposits. ..........................28<br />
South Korea Woulfe Mining is reviving South Korea’s rich mining heritage at Sangdong. ......................34<br />
One of South East Asia’s mining success<br />
stories is PanAust’s Phu Kham copper-gold<br />
operation in Laos. This photo shows one of<br />
the ASX-listed company’s Phu Kham workers<br />
looking over the processing plant. An<br />
upgrade is in progress which will increase<br />
annual copper-in-concentrate production to<br />
65,000-70,000 tonnes. <strong>The</strong> upgrade is expected<br />
to be completed in 2012.<br />
Photo courtesy PanAust.<br />
Indonesia InterMet Resources has decided not to accept two bauxite project options. .......................37<br />
China China is playing an increasingly important role in world gold markets .........................................44<br />
Philippines A nickel alliance will spend US$1.4 billion to build a second processing plant. ...................54<br />
Papau New Guinea <strong>The</strong> resource at Highlands Pacific’s Horse Ivaal Trukai deposit is up by 79%. ..............62<br />
Central Asia An extensive drilling campaign is under way at Manas Resources’ projects. ..........................66<br />
DEPARTMENTS<br />
Advertisers’ Index ............................................87<br />
Calendar of Events ..........................................80<br />
From the Editor ...............................................2<br />
Product News .................................................81<br />
Subscription Form ..........................................87<br />
Supplier News ................................................84<br />
New Phuoc Son plant .........................................7 Chatree expansion on time ............................... 22 Selinsing capacity increase ............................... 26<br />
May/June 2011 | <strong>ASIA</strong> <strong>Miner</strong> | 1
Editor's Page_<strong>Layout</strong> 1 4/22/11 9:20 AM Page 1<br />
From <strong>The</strong> Editor<br />
COMMUNICATION VITAL FOR MINING’S FUTURE<br />
AS the mining industry continues to develop in Asia, awareness of environmental<br />
issues among local inhabitants is rising, putting the two on a<br />
collision course. To prevent serious impacts communication at all levels<br />
is critically important.<br />
Pelham Bell Pottinger’s Asia CEO David Wynne-Morgan says in the<br />
past the mining industry has not been very good at communications.<br />
“<strong>The</strong> mining industry is largely run by miners who know their business<br />
very well, and love it - they are very good at finding deposits and extracting<br />
minerals out of the ground. But for them as well as the wider industry<br />
and the rest of the world, communication is getting more<br />
By John Miller /Editor<br />
important, particularly with environmental issues.<br />
“We’ve got an extraordinary situation now where the resources sector is booming and environmental<br />
pressures are increasing. On the one hand we don’t want to miss out on this enormous<br />
new wealth which is important for economies and for the companies concerned but they<br />
are increasingly having to deal with enormous environmental concerns.<br />
“National and international image is important and mining companies need to show that, yes<br />
they are miners, but also indicate that they recognize their environmental responsibilities and are<br />
dealing with them as effectively as possible.”<br />
David Wynne-Morgan says even more important than the big picture is the local community<br />
image because that’s where the trouble emanates from. “A lot of the companies are not as<br />
good at this as they could be, it is not done with a sufficient sense of priority. Some companies<br />
make enormous efforts and take a great deal of care over it, others don’t really understand the<br />
need for effective communications – from CEO level right down. CEOs see the problems it<br />
causes but many they duck it as much as they can.<br />
“It is changing, and it has to change rapidly because the industry is going to continue to boom.<br />
<strong>The</strong> next decade will be an amazing time for the mining industry but how well companies benefit<br />
from this will not only depend on their skill in getting material out of the ground, but on handling<br />
the image of the industry as a whole, particularly their relationships with local communities<br />
and being seen to be responsible and caring in the environmental area.<br />
“<strong>The</strong> big companies handle investor relations and financial communications pretty well – they<br />
could do it better but then everyone can do it better. It’s in the environmental field where some<br />
of them are particularly poor. It is important in all mining jurisdictions but particularly in emerging<br />
areas in Asia, like Indonesia and the Philippines, where environmental awareness is increasing<br />
and where there are so many factors that can impact on fragile ecosystems. It’s not<br />
just mining either, other industries such as palm oil and agriculture also impact on the environment,<br />
including the region’s dwindling rainforests.”<br />
But, David Wynne-Morgan asks how do you run a successful business that is important to<br />
the economy and at the same time honour environmental responsibilities “Solutions need to<br />
be found but you’ve got to balance the hunger, poverty, employment and contribution to the<br />
economy with the needs of the environment and you’ve got to get all stakeholders involved,<br />
which is going to involve compromise.<br />
“If you want headlines you can have the battle with environmentalists but if you want solutions<br />
it means working with stakeholders. All sides have to understand that it is broader than their particular<br />
point of view – they have to open up their gaze.” He concludes that the solution found<br />
may not be perfect but it’s going to be better for everyone than it is at present.<br />
John Miller, <strong>The</strong> <strong>ASIA</strong> <strong>Miner</strong> Editor<br />
WWW.<strong>ASIA</strong>MINER.COM<br />
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<strong>The</strong> <strong>ASIA</strong> <strong>Miner</strong>® is published six times per year by Mining Media<br />
International. Every endeavour is made to ensure that the contents<br />
are correct at time of publication. <strong>The</strong> Publisher and Editors do not<br />
endorse the opinions expressed in the magazine. Editorial advice is<br />
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Copyright 2011 Mining Media International Pty Ltd<br />
ISSN: 1832-7966<br />
2 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
Editor's Page_<strong>Layout</strong> 1 4/22/11 9:20 AM Page 2
News1_<strong>Layout</strong> 1 4/22/11 9:52 AM Page 4<br />
Asian Intelligence<br />
OVER-REACTION TO FUKUSHIMA NUCLEAR INCIDENT<br />
ONE of Australia’s foremost uranium analysts<br />
has warned that the Fukushima nuclear<br />
reactor challenges from tsunami-hit northeast<br />
Japan should be viewed in full perspective<br />
and not as ‘another Chernobyl’ or ‘Three<br />
Mile Island’. And the on-market panic which<br />
has driven uranium stocks downwards<br />
should be viewed as an opportunity to pick<br />
up ‘good value’ with uranium equities at<br />
‘bargain basement prices’.<br />
Addressing the Paydirt 2011 Uranium Conference<br />
in Adelaide, BGF Equities’ executive<br />
chairman Warwick Grigor said the Fukushima<br />
incident had the potential to be a game<br />
changer. “<strong>The</strong>re is no doubting that - and we<br />
have already seen the media circus which has<br />
milked as much drama out of it as possible.<br />
“We have seen widespread panic in the<br />
stock market with most uranium shares falling<br />
by 50% or more. Fear has dominated<br />
every action. From the start of the incident,<br />
it has been a management issue. It will continue<br />
to be a management issue. Management<br />
covers not just the practical matter of<br />
operating power stations but also the management<br />
of perceptions.<br />
“This doesn’t have to be another Three<br />
Mile Island or Chernobyl in terms of its impact<br />
on the nuclear industry. This doesn’t<br />
have to bring down the curtains, if it is placed<br />
in perspective.”<br />
Warwick Grigor said that previously, there<br />
were alternatives available for energy supply<br />
but we don’t have the luxury of those options<br />
any more “Today, we are much more aware<br />
of the concept of global warming. We know<br />
about acid rain and the pollution from coalfired<br />
power stations. We know, or should<br />
know, that a shift back to hydrocarbon-based<br />
power sources is going to exacerbate all the<br />
problems we are trying to solve.<br />
“We need to remember that every industry<br />
has its disasters. Nothing is fail-safe. Nothing<br />
is bullet proof. Some industries are in the public<br />
spotlight more than others, but in designing<br />
the future, we should not allow<br />
ignorance and emotion to guide us.<br />
“We seem to accept that there will be deaths<br />
in coal mine accidents. It happens somewhere<br />
in the world every year. It is<br />
reported, dramatized if possible, and then it<br />
is back to business as usual. No-one has<br />
suggested that coal mining should be stopped.<br />
We get one dramatic incident in 25<br />
years in an industry with an impeccable safety<br />
track record and there is a hue and cry demanding<br />
the closure of the entire industry.”<br />
He questioned the lack of balance, saying<br />
that no industry could ever say there would<br />
never be an accident or loss of human life. “If<br />
every industry had the safety record of the<br />
nuclear industry, there would be a lot less widows<br />
out there. Take a look at the disasters<br />
that regularly hit the oil and gas industry.<br />
“Unbelievable amounts of pollution are destroying<br />
lives right across the globe while the<br />
big operators make huge profits. Is this acceptable<br />
in our world but clean, low cost power<br />
from the nuclear industry is not “Maybe the<br />
profits to the operators in the nuclear power<br />
sector are not high enough to fund the lobbying<br />
(not to mention the bribes and corruption)<br />
that other industries employ. Even one ounce<br />
of rationality in the debate on the future of nuclear<br />
power would be an improvement.”<br />
RUSAL signs aluminium MoU<br />
THE world’s leading aluminium producer,<br />
United Co RUSAL Plc, has signed a memorandum<br />
of understanding (MoU) with Xinshan<br />
Aluminium Industry Demonstration Park<br />
in southwest China to develop bauxite mining,<br />
and alumina and aluminium production<br />
projects.<br />
A working group will be set up by the end<br />
of May to analyse details of the joint projects<br />
to be initiated and developed under the MoU.<br />
<strong>The</strong> MoU confirms the parties mutual interest<br />
in cooperation in the following areas:<br />
• Export of RUSAL’s technologies for production<br />
of aluminium and aluminium products<br />
with high added value to markets in China.<br />
• Engagement of RUSAL as an engineering<br />
company for aluminium plant construction<br />
projects in the territory of Xinshan Aluminum<br />
Industry Demonstration Park in Guangxi<br />
Province. Xinshan Aluminium Industry<br />
Demonstration Park’s annual demand for<br />
bauxite may reach 2 million tonnes.<br />
• Realization of joint venture projects relating<br />
to the geological study and mining of bauxites<br />
and bauxite-alumina complex construction<br />
in the Asia-Pacific Region<br />
countries. Bauxite is the ore used to produce<br />
alumina, which in turn is used for primary<br />
aluminium production.<br />
RUSAL says that the two parties are also likely<br />
to set up joint ventures to mine bauxite<br />
and build alumina complexes in other countries<br />
in the Asia-Pacific region. <strong>The</strong> partnership<br />
is supported by the governments of the municipality<br />
of Baise, Guangxi Zhuang autonomous<br />
region and the People’s Republic of China.<br />
RUSAL’s first deputy CEO Vladislav Soloviev<br />
says, “With the unprecedented pace of<br />
urbanization, China is demonstrating a<br />
steady growth in demand for aluminium. It is<br />
expected that the 2011 aluminium consumption<br />
will grow by 12% to reach 18.5<br />
million tonnes, which will require both increased<br />
imports and domestic production.<br />
“RUSAL, possessing extensive experience<br />
in sustainable development and efficient technology<br />
for a full-cycle aluminium production, is<br />
ready to become a reliable partner for China,<br />
both in terms of necessary raw materials supply,<br />
and building of new production facilities.”<br />
In 2010 RUSAL accounted for about 10%<br />
of global production of both aluminium and<br />
alumina. It employs about 76,000 people in<br />
Products from RUSAL’s Nadvoitsky aluminium smelter.<br />
4 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
News1_<strong>Layout</strong> 1 4/22/11 9:52 AM Page 5<br />
Asian Intelligence<br />
19 countries, across 5 continents and sells its<br />
products primarily in the European, Japanese,<br />
Korean, Chinese, South East Asian and<br />
North American markets.<br />
Force majeure rethink needed<br />
THE cyclone fuelled batterings of key Australian<br />
energy and mining operations should trigger<br />
a complete rethink on force majeure<br />
provisions, according to a senior resources<br />
lawyer. <strong>The</strong> caution comes as many of Australia’s<br />
largest and mid-tier coal, oil, gas and<br />
minerals producers, and owners of related<br />
export infrastructure, count the cost, liability<br />
and contractual exposure from operations<br />
shut down temporarily or permanently amid<br />
the massive floods, rain and storm damage<br />
that have swept Australia in 2011.<br />
Minter Ellison Lawyers Senior Associate<br />
Stephanie Rowland said the resources sector<br />
Aquila Resources’ Isaac Plains coal project in Queensland’s Bowen Basin<br />
was hit by flooding with force majeure provisions enforced.<br />
had witnessed a number of operators seeking<br />
shelter from further financial impact by<br />
enacting force majeure provisions. However<br />
the enactments, seemingly more geographically<br />
and commodity-style widespread than<br />
historically the case due to the sheer scope<br />
and intensity of natural disasters in 2011, had<br />
catapulted ‘force majeure’ issues to a ‘top of<br />
mind’ consideration.<br />
Force majeure clauses in contracts relieve<br />
a participant from liability under a joint operating<br />
agreement where their failure to perform<br />
is caused by a ‘force majeure’ event.<br />
Addressing the Excellence in Oil and Gas<br />
forum in Sydney, Stephanie Rowland said it<br />
was fair to conclude that the sheer scale of<br />
Mother Nature’s damage to mine sites, offshore<br />
installations, deliverability and even to<br />
the morale of personnel and regional communities<br />
had caught risk management personnel<br />
by surprise.<br />
“What we have now is an environment<br />
where potentially force majeure clauses in<br />
force for some years, have been rendered<br />
outdated almost overnight simply because<br />
their scope and detail either fails or insufficiently<br />
addresses the liabilities on both sides<br />
of a contract for such large-scale and in some<br />
cases, unpredictable impacts.<br />
“<strong>The</strong> result is that force majeure provisions<br />
have reclaimed the spotlight as a serious ‘rerisk’<br />
to project, product supply and corporate<br />
confidence. Australia’s resources sector is left<br />
facing a question – was it adequately prepared<br />
and were its interests adequately safeguarded,<br />
regardless of natural weather circumstances<br />
She said energy players needed to use the<br />
lessons learnt from managing such massive<br />
weather impacts to re-assess, revise or perhaps<br />
totally re-negotiate their force majeure<br />
provisions in key contracts. “It may also be<br />
useful if any such revision, at least at the<br />
broader industry level, invites input from external<br />
but related stakeholders.<br />
“We saw in the Brisbane floods, how<br />
quickly issues of insurance liability - often a<br />
secondary casualty of disputed force majeure<br />
claims – comes down to the absolute finite<br />
details and interpretation of a contract.<br />
“In the wake of such disasters and potential<br />
long-term dispute resolution, there is no better<br />
time for Australia’s resources sector to sit<br />
down and rejuvenate with crystal clear clarity<br />
and intent, its force majeure protocols.”<br />
Stephanie Rowland said the scope of such<br />
a review or negotiation – which should apply<br />
to any party within a force majeure contractual<br />
environment - could include more detailed<br />
and additional extra conditions recorded<br />
into key agreements.<br />
“While any number of non-weather incidents<br />
can trigger force majeure, the extraordinary<br />
climatic start to 2011 has exposed<br />
force majeure as potentially a whole new legal<br />
and corporate ball game – and there should<br />
be no expectation by risk analysts in the resources<br />
sector that the need for revision will<br />
subside any time soon.”<br />
Emissions add up for ores<br />
By Rebecca Thyer<br />
THE loading and hauling operations necessary<br />
for getting iron ore and bauxite from deposits<br />
to mineral processing facilities makes the biggest<br />
contribution to greenhouse gas emissions<br />
over the mining and mineral processing stages,<br />
environmental assessments of both metals’ mining<br />
and mineral processes have shown.<br />
Life cycle assessments (LCA) on iron ore and<br />
bauxite mining and processing, by the<br />
CSIRO’s <strong>Miner</strong>als Down Under Flagship project<br />
engineers Terry Norgate and Dr Nawshad<br />
Haque, found that loading and hauling amounted<br />
to half of both processes’ total emissions.<br />
<strong>The</strong> Commonwealth Scientific and Industrial<br />
Research Organization (CSIRO) is an Australian-based<br />
body that studies technological advances<br />
and solutions for industry and mining.<br />
<strong>The</strong> LCA results were calculated using one<br />
tonne of ore or concentrate as a functional<br />
unit ready for transport to downstream metal<br />
extraction and refining facilities.<br />
Terry Norgate says the work shows that efforts<br />
to reduce future greenhouse gas emissions<br />
over these stages of the life cycle –<br />
expected to increase as a result of falling ore<br />
grades and more finer-grained deposits –<br />
should concentrate on loading and hauling<br />
for these metals. However, it is a different<br />
story for copper concentrates. An LCA found<br />
that reducing the ore’s size was the largest<br />
greenhouse gas contributor over the mining<br />
and mineral processing stages.<br />
As copper ore has a lower grade compared<br />
to iron ore and bauxite, the crushing and grinding<br />
processes needed for processing it into<br />
concentrate contributes about 46% of that<br />
ore’s greenhouse gas emissions.<br />
Although copper ore processing produces<br />
the equivalent of 628kg of carbon dioxide per<br />
tonne, compared to bauxite at 4.9kg of carbon<br />
dioxide per tonne and iron ore at 11.9kg of carbon<br />
dioxide per tonne, emissions from iron ore<br />
represents a greater issue for Australia, he says.<br />
“That’s because iron ore represents by far<br />
the largest amount of any metallic ore or concentrate<br />
exported from Australia. About 236<br />
million tonnes are mined each year in Australia<br />
and most of that is exported,” he says.<br />
-This article originally appeared in the February 2011 issue<br />
of CSIRO's ‘Process’ magazine.<br />
May/June 2011 | <strong>ASIA</strong> <strong>Miner</strong> | 5
News1_<strong>Layout</strong> 1 4/22/11 9:52 AM Page 6<br />
SE <strong>ASIA</strong>: Vietnam<br />
MINING HAS A ROLE IN DRIVING VIETNAM’S GROWTH<br />
OF the countries that comprise Indochina,<br />
Vietnam arguably shows the most potential<br />
to sustain strong economic growth owing to<br />
its large population, abundance of natural<br />
resources, and proximity to major trading<br />
routes and the world's biggest consumer of<br />
resources, China. Vietnam's fledgling mining<br />
industry can play a major role in the nation's<br />
growth but has some way to go to<br />
reach its full potential.<br />
<strong>The</strong>re are a number of foreign companies<br />
involved in the mining industry, but not nearly<br />
as many as there could, and should, be<br />
owing to the perceived risks involved and the<br />
lack of incentive. Most of those that are involved<br />
have been present in country for some<br />
time, building up relationships with locals and<br />
the national government.<br />
It appears as though the government is<br />
now taking steps to ensure the nation as a<br />
whole can benefit from mining, which will play<br />
an important role in driving the country's own<br />
economic growth as well as supplying many<br />
of the resources needed to provide power<br />
and needed for construction.<br />
One of the foreign companies involved in Vietnam<br />
is Axiom Mining, which says that the<br />
mining industry is relatively undeveloped and<br />
this is reflected in the small number of mining<br />
companies listed on the Vietnam stock exchanges.<br />
It says that Vietnam has a large appetite<br />
for commodities, in particular gold, and<br />
in this way is similar to most other Asian<br />
countries. <strong>The</strong> World Bank recently stated<br />
that Vietnam was the world's largest importer<br />
of gold in 2008 until the government banned<br />
the importation of gold. <strong>The</strong>re are currently no<br />
gold-focused companies listed on the Vietnamese<br />
stock exchanges.<br />
It adds that Vietnam has progressively opened<br />
up its capital markets in recent years, resulting<br />
in a number of new IPOs that have been<br />
supported by international and local investors.<br />
Financial group VinaCapital has expressed<br />
belief in Vietnam’s economic development,<br />
saying it is still one of the world’s leading emerging<br />
economies and a destination for foreign<br />
investors. <strong>The</strong> group's CEO Don Lam says that<br />
in meetings with foreign investors, VinaCapital<br />
continues to hear their recognition of the Vietnamese<br />
economy’s long-term potential.<br />
VinaCapital is a leader in asset and investment<br />
management, and real estate development<br />
in Vietnam, running a property portfolio<br />
worth more than US$1.7 billion. It recently unveiled<br />
a plan to attract US$300-500 million<br />
from foreign investors to establish two more<br />
member funds to further invest in local companies<br />
and the property market.<br />
In 2011, the group also expanded the operation<br />
of VinaSecurities after signing an agreement<br />
with Macquarie Capital. It has also<br />
inaugurated VictoryCapital company in<br />
Phnom Penh, Cambodia, to help Vietnamese<br />
companies interested in Cambodia, besides<br />
its main goal of running investment there.<br />
This is indicative of the mentoring role that<br />
Vietnam can play in Indochina, particularly with<br />
its neighbours Laos and Cambodia, which are<br />
both well endowed with mineral resources but<br />
even further behind economically.<br />
Another example came in March when Vietnam<br />
and Laos signed a contract to cooperate<br />
in ore mining and processing in Houaphan province<br />
of Laos. Economic zones on each side<br />
of the border checkpoint between Vietnam and<br />
Laos are offering incentives to investors and<br />
businesses. <strong>The</strong> areas included are the Lao<br />
Bao Special Economic and Commercial Zone<br />
of central Quang Tri Province in Vietnam and<br />
the Densavan Border Trade Zone in Laos.<br />
First Phuoc Son production expected in May<br />
FIRST production from the new processing<br />
plant at Olympus Pacific <strong>Miner</strong>als’ Phuoc Son<br />
Gold Project in central Vietnam is expected<br />
during May. It is the company’s second gold<br />
plant in Vietnam after the Bong Mieu plant.<br />
Unseasonably long and heavy rains in the<br />
first few months of the year delayed completion<br />
of the plant and the subsequent commissioning<br />
process. This started at the end<br />
of March and continued through April.<br />
Underground mining resumed in late February<br />
with ore stockpiled nearby for introduction<br />
to the new circuit once the plant had<br />
passed full inspection. Dry commissioning<br />
was the first part of the beginning of production<br />
operations.<br />
Operations at the Phuoc Son project of Olympus Pacific <strong>Miner</strong>als.<br />
6 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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SE <strong>ASIA</strong>: Vietnam<br />
During these phases, components of the<br />
processing circuit were individually tested starting<br />
with the crushing circuit and ball mills.<br />
Upon successful completion of these circuit<br />
tests, the plant was to run on water with ore<br />
to be introduced a week later<br />
assuming there was minimal<br />
leakage. It is planned for gold<br />
to be produced through the<br />
gravity circuit within three<br />
days of the ore being introduced<br />
to the plant during May.<br />
Olympus' CEO David<br />
Seton says, “We are pleased<br />
to be in the final stages of delivering<br />
Vietnam's most environmentally<br />
sound gold plant,<br />
utilizing the latest technology<br />
available. This is a key development<br />
in the company's<br />
ongoing plan to expand its<br />
production in both Vietnam<br />
and Malaysia.”<br />
Olympus is a gold exploration and production<br />
company employing some 1200 people<br />
of whom 90% are Vietnamese. It is an equal<br />
opportunity employer operating two gold<br />
mines in central Vietnam near the port city<br />
of Da Nang. <strong>The</strong> company is a major employer,<br />
pays taxes and royalties and invested<br />
some US$40 million into the local economy<br />
during 2010.<br />
Construction of the processing plant at<br />
Olympus Pacific’s Phuoc Son project.<br />
During the permitting and construction phases,<br />
ore from Phuoc Son has been transported<br />
by truck to the Bong Mieu plant. Olympus received<br />
a trucking permit extension from the Ministry<br />
of Natural Resources and Environment<br />
effective from March 15, with support from the<br />
Quang Nam People's Committee, to continue<br />
this process until May 30 while the Phuoc Son<br />
commissioning was being undertaken.<br />
Olympus is positioned to expand gold production<br />
in South East Asia from its core properties<br />
and has established a production time<br />
line that increases annual production to 50,000<br />
ounces of gold in 2011 and a production pipeline<br />
capable of further expansion to 170,000<br />
ounces by 2015.<br />
Pouring concrete in the furnace hall of Hazelwood’s<br />
ATC ferrotungsten plant.<br />
Ferrotungsten production in June<br />
CONSTRUCTION of Hazelwood Resources’<br />
ATC Ferrotungsten Project at Vinh Bao is advancing<br />
at a rapid rate with first production<br />
scheduled to take place in June. <strong>The</strong> plant is<br />
the largest of its kind outside China and the<br />
design is believed to be the most technologically<br />
advanced in the world.<br />
In late April the outer refractory layer of<br />
bricks was installed inside the ferrotungsten<br />
furnace shell with the inner refractory lining<br />
consisting of ferrotungsten metal to be installed<br />
during hot commissioning, which is expected<br />
to take place in June. Orders for the<br />
first fill materials are imminent.<br />
A team of 30 experienced Chinese installation<br />
engineers are working through final installation<br />
and mechanical and electrical<br />
commissioning for targeted first production at<br />
the plant. <strong>The</strong> electrode arms are in position<br />
on their hydraulic rams while electrical connection<br />
to the EVN transmission grid is almost<br />
complete. High voltage transmission<br />
lines are immediately adjacent to the plant<br />
site. Connection can now be made with the<br />
main furnace transformer and plant low voltage<br />
transformer systems.<br />
<strong>The</strong> furnace body is in position on its tilting<br />
base and commissioning of hydraulic systems<br />
is proceeding. <strong>The</strong> furnace stack has<br />
been erected with installation of the baghouse<br />
dust collection system and heat exchanger<br />
under way. Emission control is a<br />
focus of this operation. Construction of the<br />
third storey of the site office and administration<br />
building is also advancing.<br />
On March 23 a ceiling fire occurred at the<br />
construction site with damage caused to<br />
ceiling insulation material and metal roofing<br />
panels. Repairs have been completed and<br />
disruptions to the installation schedule were<br />
only minor. <strong>The</strong> fire is believed to have been<br />
caused by a welding spark.<br />
In May 2010 Hazelwood acquired a 60% interest<br />
in Asia Tungsten Products Company<br />
(ATC), which is building the new facility. Stage<br />
one of the plant has annual nameplate capacity<br />
of about 4000 tonnes of ferrotungsten<br />
alloy, equivalent to 3000 tonnes of contained<br />
tungsten. A second stage, if completed, would<br />
have sufficient capacity to supply around 25%<br />
of the world’s ferrotungsten.<br />
Ferrotungsten is used in steels and alloys<br />
where hardness and heat resistance is required.<br />
Independent projections predict consumption<br />
in excess of 17,000 tonnes of contained<br />
tungsten in steels and alloys by 2013. Outside<br />
China, there are few sources of supply of the<br />
material. ASX-listed Hazelwood recently raised<br />
$6.84 million through a placement to increase<br />
its interest in the project and to fund commissioning.<br />
It has agreed terms with its joint venture<br />
partner to acquire a further 20% interest,<br />
which increases its stake to 80%.<br />
Hazelwood also owns the Big Hill Tungsten<br />
Deposit in the Pilbara region of Western Australia<br />
which is undergoing a definitive feasibility<br />
study and is considered a viable future<br />
source of feedstock for the ATC project.<br />
Drilling to start at Nat Son<br />
DRILLING will begin in May at Strategic Mining’s<br />
Nat Son gold exploration and development<br />
project in Hoa Binh province of northern<br />
Vietnam, about 50km southwest of Hanoi.<br />
<strong>The</strong> 2500 metres campaign is necessary to<br />
define gold reserves and to give the exact locations<br />
where to begin mining operations.<br />
<strong>The</strong> drilling was scheduled to start in late<br />
March after the arrival of a Boart Longyear<br />
LF 70 diamond core angular drill rig in Vietnam<br />
but was delayed due to unanticipated<br />
delays at customs and the need to order additional<br />
parts for the rig. <strong>The</strong> company is arranging<br />
the schedule for the geologist and<br />
drilling crew from Core One, an experienced<br />
US drilling company, to arrive on site during<br />
May to begin the program.<br />
<strong>The</strong> acquisition of the LF 70 diamond core<br />
drill rig on a Morooka track system is an im-<br />
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SE <strong>ASIA</strong>: Vietnam<br />
portant step for the continued development<br />
of Nat Son. <strong>The</strong> LF 70 is the first angular core<br />
drill rig in Hoa Binh province and the company<br />
has received strong support from the Vietnamese<br />
Government for bringing the latest<br />
angular core drilling technology to the region.<br />
<strong>The</strong> rig has now cleared customs, has been<br />
moved to a storage facility near the gold property<br />
and has been inspected.<br />
Assays from rock samples have shown<br />
gold values as high as 47.3 grams/tonne and<br />
Evidence of mine workings at the Nat Son site of Strategic Mining.<br />
silver values as high as 228 grams/tonne, and<br />
the company is keen to begin exploration.<br />
Strategic’s president Todd Sterck says,<br />
“<strong>The</strong> new drilling rig will enable the company<br />
to work throughout all seasons and to initiate<br />
drilling programs in previously inaccessible<br />
areas.”<br />
With this strategy in mind, the company is<br />
in negotiations to purchase an interest in the<br />
nearby operating Dong Thanh gold property.<br />
A team from Strategic, including Todd Sterck<br />
and consultants, visited Vietnam in March to<br />
visit the Dong Thanh site, continue negotiations<br />
and investigate several other gold producing<br />
properties in the same region.<br />
<strong>The</strong> team gathered samples from Dong<br />
Thanh and these are being tested by a qualified<br />
US metallurgist to determine the cost and<br />
best method to attain the highest extraction<br />
level for the gold. <strong>The</strong> results will assist in finalizing<br />
an agreement.<br />
<strong>The</strong> company believes Dong Thanh, which<br />
is about 12km from Nat Son and on the same<br />
gold trend, could produce 20,000 ounces annually<br />
in the first year through improvements<br />
in mining mechanization and processing.<br />
Todd Sterck says, “Our goal is to become<br />
a significant gold producer. We are currently<br />
focused on the exploration and development<br />
of gold properties in Vietnam, the US and<br />
Africa. <strong>The</strong> company intends to expand by<br />
acquiring mineral rights to more key properties<br />
and initiating strategic joint ventures.”<br />
Drilling starts at Pu Sam Cap<br />
FOLLOWING the receipt and review of<br />
assay results from recent field work Triple<br />
Plate Junction has<br />
started a 3000 metre<br />
diamond core drilling<br />
program at the Bai<br />
Bang prospect of its<br />
Pu Sam Cap gold<br />
project in Vietnam’s<br />
far north. <strong>The</strong> company<br />
expects to complete<br />
the drilling in<br />
August, although the<br />
timing depends on<br />
the wet season which<br />
is due to start around<br />
the end of May.<br />
Of 231 samples<br />
taken, 43 rock chip<br />
channel samples and<br />
4 rock grab samples returned<br />
assays greater than 2 grams/tonne gold,<br />
ranging from 2.01 to 29.3 grams/tonne gold<br />
and from 0.2 to 103 grams/tonne silver. <strong>The</strong><br />
43 rock chip channel results averaged a true<br />
width of 0.86 metres at a weighted average<br />
grade of 4.50 grams/tonne gold and 11.5<br />
grams/tonne silver. <strong>The</strong> four rock grab samples<br />
ranged from 2.54 to 22.4 grams/tonne<br />
gold, averaging 13.3 grams/tonne.<br />
Triple Plate’s exploration director Bill Howell<br />
says, “<strong>The</strong> results<br />
have increased the<br />
strike length of known<br />
mineralized zones, and<br />
some of the gold values<br />
are very encouraging.<br />
<strong>The</strong> zones will be tested<br />
for grade, continuity and<br />
depth extent by the drilling<br />
program now under<br />
way. <strong>The</strong> new zones<br />
identified will also require<br />
follow up work.”<br />
Triple Plate’s chief<br />
executive Fraser McGee<br />
says, “Recently I had a<br />
very positive visit to our project in Vietnam,<br />
and I am very pleased that our continued<br />
and determined work has yielded these encouraging<br />
results. <strong>The</strong> commencement of<br />
the drill program is another clear positive<br />
step in the development of the company's<br />
business as a whole this year, and I am looking<br />
forward to providing our shareholders<br />
and the wider market with the results over<br />
the next five or six months.”<br />
<strong>The</strong> rock chip channel and rock grab samples<br />
were taken across structurally controlled<br />
mineralization in outcrop and<br />
underground tunnels driven by historical artisanal<br />
miners at Bai Bang. <strong>The</strong> sampling<br />
was aimed at extending the strike length of<br />
known high grade gold mineralization previously<br />
encountered by Triple Plate.<br />
<strong>The</strong> program established two main steeply<br />
dipping structural zones trending east-west<br />
for about 1km and a second zone trending<br />
NE-SW for about 1.6km. Several other subsidiary<br />
zones were also identified in the<br />
sampling program.<br />
Pu Sam Cap has long been recognized as<br />
a large gold-copper mineralized centre. It has<br />
been estimated by local government authorities<br />
that in the 1990s some 3000 local artisanal<br />
miners were extracting gold from a series<br />
of veins over an area covering 10sqkm centred<br />
at Bai Bang.<br />
Work by TPJ since 2005 has confirmed<br />
that these veins are up to 2 metres in width<br />
and can be traced through a vertical interval<br />
in excess of 500 metres and along strike<br />
lengths up to 2000 metres. Scout diamond<br />
drilling on one of the veins intercepted a 2<br />
metre interval at 7.9 grams/tonne gold, including<br />
1 metre at 12.4 grams/tonne at a<br />
hole depth of 122 metres.<br />
Known mineralized zones at Triple Plate Junction’s Pu Sam Cap<br />
project in a 3D Landsat drape.<br />
8 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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SE <strong>ASIA</strong>: Vietnam<br />
Axiom forms Vietnam company<br />
Axiom Mining has formed a Vietnamese operating<br />
company called Axiom Vietnam JSC<br />
following the issue of a JSC licence. <strong>The</strong> JSC<br />
status enables Axiom to begin the process of<br />
listing its Vietnam interests on one of two Vietnamese<br />
stock exchanges and raise capital<br />
to fund its operations in Vietnam.<br />
Axiom Vietnam JSC is a subsidiary of<br />
Axiom that will be used to hold all of its Vietnamese<br />
mineral interests. <strong>The</strong> four gold projects<br />
Axiom is pursuing in Vietnam will be<br />
transferred from other Axiom subsidiaries to<br />
be held in Axiom Vietnam JSC.<br />
Axiom has two mineral exploration and mining<br />
licence applications proceeding through<br />
the government's approval process. <strong>The</strong>se<br />
applications cover areas in central Vietnam<br />
that lie in the highly prospective Sepon region.<br />
In anticipation of the exploration and mining<br />
licences being granted, Axiom is proposing<br />
to raise equity in Axiom Vietnam JSC<br />
to fund this exploration with drill teams ready<br />
to begin the planned activities during the<br />
current dry season.<br />
Axiom has a 70% interest in the Quang<br />
Binh gold-silver project and an 80% interest<br />
in the Quang Tri gold-silver project, both in<br />
central Vietnam, not far from the operating<br />
Sepon project in Laos. it also has an 80% interest<br />
in the Khanh Hoa gold-silver prospect<br />
in the south, not far from the coast and a freecarried<br />
8.47% interest in the Pu Sam Cap<br />
gold-copper prospect in the far north, which<br />
is operated by Triple Plate Junction.<br />
At Quang Binh 58 diamond drill holes have<br />
been completed and have outlined large tonnage,<br />
low-grade gold-silver mineralization in<br />
geological and structural settings similar to nearby<br />
world-class gold and copper deposits<br />
being mined at Sepon. <strong>The</strong> final stages of a licence<br />
renewal application have been reached<br />
in advance of an infill JORC drilling campaign.<br />
At Quang Tri artisanal miners are working<br />
four large high-grade precious metal targets<br />
in Sepon-like geology. An exploration application<br />
is nearing licence issue.<br />
An exploration application has been submitted<br />
over a volcanic related epithermal<br />
gold-silver target at the Khanh Hoa prospect.<br />
This extensive area has been subjected to<br />
past unlicensed mining.<br />
Axiom has received significant interest in it<br />
projects in Vietnam and proposes to introduce<br />
Vietnamese investors to help fund the<br />
operations and reduce it interest in the gold<br />
projects. Axiom's aim is to maintain a strategic<br />
shareholding and to have the JSC majority<br />
owned in Vietnam. Axiom's CEO Ryan<br />
Mount says, “<strong>The</strong> issue of the JSC licence is<br />
a major achievement and completes a key<br />
milestone in our regional business plan. It provides<br />
for the most efficient funding option for<br />
a development and will eventually have our<br />
Vietnamese assets well positioned and attractively<br />
priced on local markets.<br />
A plan of drill holes and drill targets at<br />
Axiom’s Quang Binh project.<br />
“It is a great testament to the capability of<br />
our newly formed team in Vietnam and highlights<br />
Axiom's ability to identify an employ key<br />
personnel in the region.”<br />
Thach Khe impeded by lack of funds<br />
LACK of financial support from a number of investors<br />
is impeding development of the Thach<br />
Khe iron project in the central province of Ha<br />
Tinh. Thach Khe is considered the biggest iron<br />
ore mine in South East Asia and is believed to<br />
have a total reserve of 544 million tonnes.<br />
Vietnam’s Ministry of Industry and Trade held<br />
a special meeting on April 13 to discuss restructuring<br />
of the capital contribution to Thach<br />
Khe Iron Joint Stock Company (TIC), the mine’s<br />
investor. <strong>The</strong> meeting was convened because<br />
many TIC shareholders have not fulfilled their<br />
capital contribution commitments, thus slowing<br />
down implementation of the project.<br />
TIC was set up four years ago, with a chartered<br />
capital of 2.4 trillion dong. <strong>The</strong> company’s<br />
main function was exploiting iron at the<br />
Thach Khe mine and providing iron ore to<br />
serve domestic demand as well as for export.<br />
It was also intended for TIC to build and run<br />
an ingot steel mill with initial annual capacity<br />
of 2 million tonnes but which could be expanded<br />
if there were favourable conditions.<br />
TIC has nine main shareholders, including<br />
Vietnam Coal and Mining Industries Group<br />
(Vinacomin) which holds 30%, Ha Tinh <strong>Miner</strong>al<br />
and Trade Corporation with 24%, Vietnam<br />
Steel Corporation 20%, Vietnam Post and Telecommunication<br />
Group 4%, Bank for Investment<br />
and Development of Vietnam 5%, Song<br />
Da Corporation 5%, Vietnam Shipbuilding Industry<br />
Group (Vinashin) 5%, Binh Minh Import-Export<br />
Company 4% and Thang Long<br />
<strong>Miner</strong>al and Metallurgy Company 3%.<br />
Of these nine shareholders Vinashin, which<br />
has been facing a crisis and is bogged down<br />
in debts, cannot make a capital contribution.<br />
Some other shareholders have also failed to<br />
make contributions. In 2010, shareholders<br />
did not contribute 1.3 trillion dong worth of<br />
committed capital and only managed to contribute<br />
221.5 billion dong, the amount that<br />
should have been paid in 2009. In late 2010,<br />
TIC signed a contract worth about 63 billion<br />
dong to draw up technical designs and estimates<br />
for iron exploitation.<br />
TIC’s general director Ho Buc Dinh told Vietnamese<br />
media that the failure of some<br />
shareholders to contribute committed capital<br />
had been seriously affecting operation of<br />
the project. After the April 13 he said that<br />
TIC did not have the capital to operate and<br />
the tardiness in project implementation had<br />
made debts increase.<br />
He said TIC’s board of directors would hold<br />
an extraordinary meeting where an announcement<br />
would be made that shareholders would<br />
have to make capital contribution before May<br />
30. In case the shareholders could not contribute<br />
capital, the project would have to seek<br />
more capital from existing shareholders or call<br />
for investments from new shareholders.<br />
He said that TIC and the Ha Tinh Provincial<br />
People’s Committee were still determined to<br />
implement the project as previously scheduled.<br />
“We have injected 700 billion dong in the<br />
project, and we cannot stop it now.”<br />
Vinacomin expansion program<br />
VIETNAM National Coal <strong>Miner</strong>al Industries Holding<br />
Corporation (Vinacomin) has set a target<br />
of annually producing 55 million tonnes by<br />
2015. <strong>The</strong> target forms part of the company’s<br />
draft development plan for 2011-15. To meet<br />
the target Vinacomin intends to increase production<br />
by 1-3 million tonnes each year.<br />
<strong>The</strong> underground mines must stabilize production<br />
and increase gradually; open-cast<br />
mines in the Hon Gai area must end this form<br />
of mining; the open-cast mines in the Cam<br />
Pha area must stabilize production while Khe<br />
Cham 2 must increase annual capacity by<br />
2015 to reach 3 million tonnes and Cao Son<br />
must reach 5 million tonnes.<br />
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SE <strong>ASIA</strong>: Laos<br />
DRILLING IN NEW ZONE AT YUQIDA BAUXITE TENEMENT<br />
ADDITIONAL drilling has started in a new target<br />
zone at Ord River Resources’ Yuqida tenement<br />
on the Bolaven Plateau in<br />
Champasak province. Sample testing is also<br />
being carried out at the prospect as Ord prepares<br />
for resource calculations.<br />
It is hoped that the drilling and testing will<br />
increase the resource calculation and add<br />
value to the project.<br />
This work is part of the Aus$5.3 million feasibility<br />
study being prepared by Chinese engineering<br />
firm Sinomine Resource Exploration Co<br />
for the bauxite/alumina project, which is being<br />
advanced under a joint venture company called<br />
Sino Australian Resources Co (SARCO). <strong>The</strong><br />
JV company is 49%-owned by Ord and 50%<br />
by operator China Non-Ferrous Metal Industry’s<br />
Foreign Engineering & Construction Co.<br />
<strong>The</strong> JV’s exploration activities are designed<br />
to delineate a high-quality, JORC-compliant<br />
bauxite resource on the Bolaven Plateau in<br />
Bauxite is clearly visible at surface through sparse vegetation on the LSI tenement.<br />
the far south of Laos. <strong>The</strong>re are two tenements,<br />
Yuqida and LSI, which total 487sqkm.<br />
Sinomine has maintained seven drill rigs and<br />
moved them to the Yuqida site for the drilling<br />
program. It has fully completed interpretation<br />
of remote sensing data for 287sqkm of the Yuqida<br />
tenement and has completed 48km of<br />
road rebuilding for the ore bodies.<br />
<strong>The</strong> work program has also seen the contractor<br />
complete four survey base points, undertake<br />
48km of exploration line building for<br />
the ore bodies with 15 pegs buried and finish<br />
a traverse survey of 46.5km.<br />
Until the start of April, positions had been<br />
surveyed for 368 holes at Yuqida, there had<br />
been 2464.7 metres drilled with 730 samples<br />
taken along with 10 samples for density.<br />
By the end of March Sinomine had assayed<br />
1331 samples from the LSI tenement, had<br />
carried out a 66sqkm oryctognosy survey<br />
and tested 10 samples for density.<br />
SARCO has successfully proven up a large<br />
world-class bauxite deposit in two tenements.<br />
A JORC-compliant indicated resource of 130<br />
million tonnes was identified at the end of 2008.<br />
<strong>The</strong> combined resource has 32% available alumina,<br />
3% reactive silica and 0.15% organic carbon.<br />
<strong>The</strong> deposit is comparable in grade and<br />
quality with the deposits in the Darling Ranges<br />
of Western Australia and superior to current domestic<br />
Chinese bauxite and Indonesian bauxite.<br />
<strong>The</strong> current objective is to establish a worldclass<br />
alumina refinery but direct shipping of<br />
bauxite is a valid alternative for development.<br />
Ord says SARCO enjoys several significant<br />
competitive advantages in terms of ease of<br />
mining and nearby key infrastructure. It remains<br />
confident that SARCO will develop the<br />
project into a world-class operation.<br />
<strong>The</strong> joint venture hopes to make a decision<br />
on the next development stage after receiving<br />
the study. A resource calculation for LSI is expected<br />
shortly while a calculation for Yuqida<br />
will be completed in June/July.<br />
<strong>The</strong> options to be considered are for a refinery<br />
with annual alumina output of 600,000 tonnes,<br />
direct shipping of bauxite or a staged development<br />
starting with direct shipping followed by<br />
the refinery.<br />
Joint venture on coal prospects<br />
ATOMIC Resources has entered into a joint<br />
venture agreement with Indochina Coal to explore<br />
and develop coal properties in Laos.<br />
Two prospective areas that are currently not<br />
under tender have been identified and the<br />
company intends to make applications for<br />
prospecting an exploration licences.<br />
Atomic is an Australian-based, ASX-listed<br />
exploration and resource development company<br />
with major thermal coal assets in Tanzania<br />
while Indochina is a privately held<br />
Australian company which for several years<br />
has been researching and identifying early<br />
stage coal opportunities in Indochina and<br />
South East Asia through regional evaluations<br />
and reconnaissance.<br />
<strong>The</strong> principals of Indochina include highly<br />
respected geologists with many years of successful<br />
coal exploration experience in Indonesia<br />
and South East Asia, much of this in the<br />
early stage identification of opportunities.<br />
<strong>The</strong> group has compiled a significant database<br />
on regional ASEAN coal occurrences,<br />
completed initial field work in prospective<br />
areas and prioritized exploration opportunities.<br />
This has resulted in identification of two<br />
prospective areas in Laos.<br />
Atomic will own 100% of the joint venture<br />
under the terms of the agreement by paying<br />
to Indochina a US$500,000 finders’ fee once<br />
an exploration licence has been granted. Indochina<br />
will receive a gross royalty of 2% on<br />
coal sales for the duration of the project, with<br />
Atomic able to purchase the future royalty<br />
stream at any time for $5 million.<br />
Atomic’s chairman Graeme Robertson says,<br />
“This is an excellent opportunity for Atlantic to<br />
expand its operating base in Laos, which is largely<br />
unexplored but where there are significant<br />
coking and thermal coal opportunities.<br />
“We are very pleased to be able to work<br />
alongside the principals of Indochina who<br />
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have exceptional skills in exploration. <strong>The</strong><br />
partnership complements Atomic’s expertise<br />
in mine development and operations, and will<br />
provide strong synergies to allow Atomic to<br />
meet its medium-term objectives of being a<br />
coal producer in both Africa and Asia.”<br />
Atomic and Indochina are also finalizing a<br />
similar style agreement to cover Vietnam.<br />
During 2010 the company confirmed a highgrade<br />
gold discovery in close proximity to the<br />
copper-gold system at Tharkek. <strong>Miner</strong>alization<br />
has been intersected over an area of about<br />
100 metres x 100 metres and has an estimated<br />
true thickness of between 15 and 20 metres<br />
with intersection grades from 3 grams/<br />
the Sepon gold mine in Laos and at the Carlin<br />
trend in Nevada, USA.<br />
Argonaut has completed detailed preparatory<br />
work and has identified highly mineralized<br />
but structurally complex target zones. <strong>The</strong><br />
5000 metre drilling program is testing the<br />
most prospective mineralized zones.<br />
Initial resource for KTL deposit<br />
AN initial mineral resource of about 350,000<br />
tonnes of copper and 500,000 ounces of<br />
gold has been announced for the KTL deposit<br />
at PanAust’s Phonsavan Copper-Gold<br />
Project. KTL and the nearby Tharkek deposit<br />
comprise Phonsavan, which is in the northern<br />
part of PanAust’s contract area.<br />
<strong>The</strong> resource estimate is based on a 0.25%<br />
copper cut-off grade and shows 18.2 million<br />
indicated tonnes @ 0.38% copper and 0.14<br />
grams/tonne gold, and 63.5 million inferred<br />
tonnes @ 0.44% copper and 0.2 grams/<br />
tonne gold for a total 81.6 million tonnes at<br />
average grades of 0.43% copper and 0.19<br />
grams/tonne gold.<br />
<strong>Miner</strong>alization at KTL comprises multiple tabular<br />
lenses with an overall strike length of<br />
about 2km, dipping to the south at about 45<br />
degrees. Data from 117 drill holes for a total<br />
of 20,420 metres was used to compile to<br />
estimate. PanAust has started scoping studies<br />
on the development concept for Phonsavan.<br />
<strong>The</strong> study contemplates open pit<br />
mines for both the KTL and Tharkek deposits<br />
feeding a central processing plant with annual<br />
capacity to produce about 30,000 tonnes of<br />
copper-in-concentrate plus gold credits.<br />
Studies are being phased with an overall<br />
objective of completing a feasibility study by<br />
the end of 2012 subject to ongoing resource<br />
drilling success. Preliminary metallurgical test<br />
work has been completed on drill core samples<br />
and results indicate that copper and gold<br />
can be removed by conventional bulk flotation<br />
into a marketable concentrate.<br />
Phonsavan has good access to infrastructure<br />
including sealed roads and grid power.<br />
KTL and Tharkek are about 5km apart and<br />
close to the town of Phonsavan which has a<br />
population of about 57,000 that would provide<br />
a source of labour. <strong>The</strong> Vietnamese<br />
coast is about 250km to the west by sealed<br />
road and Vietnamese ports are the most likely<br />
options for concentrate shipments. PanAust<br />
has started a resource drilling program at<br />
Tharkek with the objective of identifying an initial<br />
resource estimate by the end of the year.<br />
Drilling operations in the open pit at PanAust’s Phu Kham project. Photo courtesy of PanAust.<br />
tonne to 13 grams/tonne. It remains open to<br />
the east and west. PanAust is expected to resume<br />
drilling at this discovery in mid-2011.<br />
Meanwhile, at the company’s operating Phu<br />
Kham project an upgrade is in progress which<br />
will increase annual copper-in-concentrate production<br />
from 60,000-65,000 tonnes to 65,000-<br />
70,000 tonnes. <strong>The</strong> upgrade as well as the<br />
commissioning and ramp-up of the Ban<br />
Houayxai Gold-Silver Project, both of which are<br />
expected in 2012, will see PanAust’s annual<br />
production increase to 65,000-70,000 tonnes<br />
of copper, more than 150,000 ounces of gold<br />
and 1 million ounces of silver.<br />
<strong>The</strong> company also anticipates completing<br />
by mid-2012 the necessary permitting and<br />
studies for an open pit mine and vat<br />
leach/SX-EW facility at the Puthep Copper<br />
Project in Thailand for annual production of<br />
25,000-30,000 tonnes of copper cathode.<br />
Drilling under way at Ban Bak<br />
ARGONAUT Resources has started a 5000<br />
metre reverse circulation drilling program at<br />
its 65% held Xekong gold tenement in southern<br />
Laos. <strong>The</strong> exploration program is targeting<br />
replacement-style gold mineralization<br />
analogous in nature to mineralization found at<br />
Rock chip samples from Ban Bak have returned<br />
gold assays of up to 368 grams/tonne<br />
and silver assays of up to 124 grams/tonne.<br />
Trenching has returned gold assays of up to<br />
40 grams/tonne and silver of up to 95 grams/<br />
tonne. This work has primarily been carried<br />
out in the north of the prospect, although<br />
there has also been some samples gathered<br />
and trenching carried out towards the south.<br />
<strong>The</strong> company has cleared unexploded ordinance<br />
from 15km of access track and 3km<br />
of inter-prospect development tracks. A drill<br />
and blast team was used under the supervision<br />
of Lao Government authorities to create<br />
road cuttings in seven areas of particularly<br />
steep, rocky terrain. <strong>The</strong> company has also<br />
completed a ground magnetic survey at the<br />
Ban Bak and Phu Tuang target areas. About<br />
1300 soil samples in the Ban Bak area have<br />
been collected and analysed since November<br />
2010 which have assisted Argonaut in selecting<br />
the primary drill targets.<br />
At the Century project in central western<br />
Laos, not far from the capital Vientiane and<br />
adjacent to the Thai border, Argonaut has entered<br />
into a management and shareholders<br />
agreement with Aurum Resources, a subsidiary<br />
of US-based Aurum Inc.<br />
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Aurum Resources is a development stage<br />
company which engages in exploration and<br />
development of mineral properties. It focuses<br />
on exploration for gold and copper in Laos.<br />
Argonaut Overseas Investments, an indirectly<br />
wholly-owned subsidiary of Argonaut<br />
Resources, holds a 70% interest in Argonaut<br />
Resources (Laos) which in turn holds a 100%<br />
interest in the 223sqkm Century concession.<br />
Under the terms of the agreement, Aurum<br />
has been appointed manager of the Century<br />
Thrust Joint Venture Agreement and will have<br />
the right to earn 72.86% of Argonaut Overseas<br />
Investments, which is equivalent to a 51% beneficial<br />
interest in the Century concession.<br />
Prospects within Argonaut Resources’ Xekong project.<br />
In order to acquire this interest, Aurum<br />
must spend US$6.5 million on exploration<br />
within five years. <strong>The</strong> five year period includes<br />
an initial one year assessment period. At<br />
the completion of this earn-in Argonaut Resources’<br />
interest in the Century concession<br />
will be 19%. Aurum's Lao-based technical<br />
team is finalizing a proposal to conduct confirmatory<br />
drilling programs in the current<br />
Laotian dry season.<br />
Luang Namtha exploration extended<br />
LUANG Namtha Copper/Silver Project joint<br />
venture partners Amanta Resources and<br />
Japan Oil, Gas and Metals National Corporation<br />
(JOGMEC) have agreed to extend the<br />
current exploration and drilling programs at<br />
the project by three months to June 30.<br />
<strong>The</strong> decision to extend the programs from<br />
March 31 at the project in northern Laos was<br />
taken at a joint meeting in Kawasaki, Japan.<br />
To facilitate the extension JOGMEC has<br />
agreed to increase the budget allocation for<br />
the present project phase by $400,000 to<br />
$1.7 million. <strong>The</strong>se funds will to permit an escalation<br />
in exploration activities, including the<br />
expansion of drilling, to take advantage of the<br />
regional dry season and lead to greater efficiencies<br />
in the project activities.<br />
Amanta and JOGMEC have finalized a revised<br />
budget and exploration program which<br />
includes additional drilling programs at the<br />
Pakieng area and further evaluation of other<br />
prospective areas, such as the Nam Bo and<br />
Chakamping areas. Amanta’s president and<br />
CEO Gerald Wright says, “We are very pleased<br />
with the level of co-operation between<br />
JOGMEC and Amanta. <strong>The</strong> increased budget<br />
allocation will permit the parties to expand the<br />
existing drilling activity and further advance<br />
the Luang Namtha project.”<br />
<strong>The</strong> first reconnaissance drill hole earlier<br />
this year at the NW Pakieng molybdenum<br />
target returned strong molybdenum intersections.<br />
<strong>The</strong> hole’s location was identified<br />
during Amanta’s reconnaissance sampling<br />
program at the Pakieng area of the Luang<br />
Namtha project. <strong>The</strong> hole was completed as<br />
part of the ongoing reconnaissance drilling<br />
program, which is aimed at preliminary evaluation<br />
of the copper/silver mineralization and<br />
molybdenum mineralization at Pakieng.<br />
Soil sampling programs identified a consistently<br />
strong molybdenum anomaly over an<br />
area of about 400 by 500 metres, open to the<br />
north and west. Induced polarization surveys<br />
over the molybdenum anomaly identified<br />
zones of high chargeability, indicating sulphide<br />
mineralization extending to depth.<br />
Molybdenum-in-soils values of up to<br />
170ppm were accompanied by strongly anomalous<br />
gold in soils values of up to 1.1<br />
grams/tonne gold. A channel sample taken<br />
at an outcrop within the target area, averaged<br />
0.25% molybdenum over 8 metres, with a<br />
maximum value of 0.8%. This channel also<br />
averaged 0.22 grams/tonne gold, with a high<br />
of 0.4 grams/tonne gold and 24 grams/tonne<br />
silver with a high of 41 grams/tonne silver.<br />
<strong>The</strong> first hole was at the margin of the chargeability<br />
anomaly, its location being dictated<br />
by site access considerations. Reported<br />
assay results include a 25-metre wide mineralized<br />
interval grading 0.044% molybdenum,<br />
from 13 to 38 metres along the core, which<br />
includes a high-grade zone grading 0.17%<br />
molybdenum, over 3 metres.<br />
Gold and silver values accompany the molybdenum.<br />
In the 3-metre high grade core, silver<br />
grades average 17 grams/tonne, while<br />
gold grades average 0.25 grams/tonne.<br />
<strong>The</strong>se results are highly encouraging as they<br />
confirm the surface results continue at depth.<br />
Applications target gold-copper<br />
RECENT ASX-listing Indochine Mining has<br />
seven Foreign Investment Applications (FIAs)<br />
in the Lao Peoples Democratic Republic,<br />
which to date have not been granted. <strong>The</strong><br />
FIA’s cover prospective areas principally targeting<br />
gold and copper mineralization.<br />
Indochine hopes these applications will add<br />
to its suite of projects in Cambodia and Papua<br />
New Guinea. It believes Laos has abundant<br />
natural resources and that the regulatory framework<br />
of the mining and energy sectors is<br />
rapidly developing, as government policy and<br />
regulatory capacity begins catching up with<br />
the fast expanding resources sector.<br />
Mining, as one of the two major foreign investments,<br />
has been a major contributor to<br />
Laos’ increased growth of about 6% per year<br />
and Indochine says the government appears<br />
keen to promote the sector.<br />
<strong>The</strong> group's interests in Laos comprise<br />
seven FIAs - <strong>The</strong> Attapeu project comprises<br />
2000sqkm and is held by IRL, the Sepon area<br />
project comprises 2026sqkm and is held by<br />
Aries Mining, the Virabouly project is of<br />
1101sqkm and is held by IRL, the Savannahket<br />
project is 1860sqkm and is held by IRL,<br />
which also holds the Oudomxai project of<br />
2561sqkm. Aries holds the Houaphan project<br />
of 1285sqkm and the Houaphan South project<br />
of 301sqkm for a total of 11,134sqkm.<br />
<strong>The</strong> FIA at Xaybouathong and Virabouly is<br />
positioned near the towns with the same<br />
names in the Sepon district and partially adjoins<br />
China Minmetals Non-Ferrous Co’s<br />
Sepon mining tenements and the Savannahket<br />
Project is directly to the west. <strong>The</strong> Attapeu<br />
project is immediately north of the company’s<br />
Ratanakiri project in Cambodia. Oudoumaxi<br />
and Houaphan North & Houaphan South are<br />
in the north of the country. All projects are<br />
prospective for gold and base metals.<br />
<strong>The</strong> four main prospects of Xaybouathong,<br />
Attapeu, Savannahket and Oudoumaxi are interpreted<br />
to cover various controlling large intrusive<br />
complexes dissected by faults and are<br />
ringed by arcuate fractures. All of the intrusive<br />
complexes have known mineralization close by.<br />
Additionally a series of parallel arcuate structures<br />
are truncated by regional shear zones.<br />
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SE <strong>ASIA</strong>: Cambodia<br />
LONG TREK TO REALIZE MINING POTENTIAL<br />
ALL countries in the area known as Indochina<br />
have potential to benefit from extraction of natural<br />
resources and the mining industries of<br />
these countries are at different stages of development.<br />
Of the five countries – Vietnam,<br />
Thailand, Laos, Cambodia and Malaysia – it is<br />
Cambodia that has had the least exploration<br />
and possibly presents the most opportunity.<br />
However, the kingdom still has some way<br />
to travel before it can start to realize this potential<br />
and assist its economic development.<br />
It needs businesses, mining companies, service<br />
and infrastructure providers, governments<br />
at all levels and the people to work<br />
together to ensure that everyone benefits<br />
from future mining and that it is done in a sustainable<br />
manner.<br />
Cambodian Association of Mining and Exploration<br />
Companies (CAMEC) president Richard<br />
Stanger is well aware of the<br />
opportunities and challenges facing the development<br />
of a sustainable mining industry in the<br />
country. He told the Cambodian media that<br />
the kingdom could potentially contain a ‘bonanza’<br />
of mineral wealth, but finding and extracting<br />
the resources is a risky, expensive<br />
business. “If Cambodia has a mineral industry<br />
it will add a lot more strength to GDP. It will give<br />
a buffer against the value of the other sectors.”<br />
CAMEC has 21 companies as members,<br />
including OZ <strong>Miner</strong>als, Southern Gold and Liberty<br />
Mining, of which Richard Stanger is managing<br />
director. Many of the present<br />
members are Australian junior miners who<br />
have joined together to provide an industry<br />
voice for the sector as it develops.<br />
A concern that CAMEC would like to see<br />
addressed is the implementation of a minerals<br />
law addressing issues such as taxation,<br />
which could be in place this year.<br />
“We’re obviously risk takers,” he said of exploration<br />
companies in Cambodia. “We didn’t<br />
come in with the football rules fully finalized.<br />
But we saw the potential, and saw that we<br />
can work with the government here, so we’re<br />
pretty happy.”<br />
A setback to the development of the industry<br />
has been a tendency for speculators to<br />
buy and sell concession licences, with little intention<br />
of actually exploring their tenements.<br />
“I think that was one of the main irritations to<br />
the Ministry of Industry, Mines and Energy<br />
until the middle of 2005,” Richard Stanger<br />
says. “Once companies like us were really<br />
starting exploration they were quite happy,<br />
because until then people were mostly buying<br />
and selling concessions.<br />
“I think they heard that story a lot of times<br />
before we came along. <strong>The</strong>y gave us a bit of<br />
rope and we didn’t hang ourselves with it. We<br />
basically went out there and spent the money<br />
on the ground. We’re trying to do everything<br />
as properly as we can, as well as working<br />
with local communities and employing people<br />
and training people.<br />
However, some speculation on concessions<br />
is still ongoing. He claims that one company<br />
recently approached him offering a concession<br />
for US$3 million that they’d only had for three<br />
weeks and had done minimal work on it. “Just<br />
buying and selling, it locks up the mineral potential<br />
of the country.” He says in most mining<br />
jurisdictions concessions are usually handed<br />
out on the basis that the licence-holder conducts<br />
a certain level of work.<br />
Gold discovered at Kratie North<br />
A DRILLING program has started on the Kratie<br />
North Gold Project where Indochine Mining recently<br />
discovered a new area of gold-bearing<br />
quartz veins. Initially<br />
the company is carrying<br />
out 2000 metres<br />
of diamond<br />
drilling with RC drilling<br />
to follow in the<br />
best identified area.<br />
<strong>The</strong> diamond drilling<br />
aims to test and<br />
observe the mineralized<br />
structures<br />
from the geophysics<br />
and geochemistry. A<br />
series of targets have been selected for drilling<br />
based on 3-D modelling of the geophysics<br />
merged with geochemical results and<br />
surface mapping.<br />
At first the diamond drilling, which started<br />
in the third week of April, will test a geophysical<br />
IP target with a coincident gold-in-soil anomaly.<br />
A series of holes will be drilled along a<br />
1km trend identified in geophysics which includes<br />
recently discovered multiple sets of<br />
gold-bearing quartz veins at surface.<br />
Samples gathered from the Kratie North Gold Project<br />
of Indochine Mining.<br />
An ongoing IP geophysical survey will identify<br />
further drill targets over this area and two<br />
deeper magnetic targets further east. An enlarged<br />
infill RC drilling program will follow the<br />
initial program. Kratie North, in the centre of<br />
the country is a key focus for Indochine,<br />
which recently listed on the ASX and has the<br />
largest package of gold/copper leases in<br />
Cambodia. It also has the Ratanakiri project<br />
in the far northeast.<br />
<strong>The</strong> Kratie North discovery was made during<br />
sampling of multiple sets of outcropping<br />
quartz veins over 50-100 metre strike length<br />
in two locations about 500 metres apart.<br />
<strong>The</strong> veins trend east-west, dipping 45 degrees<br />
to the south and are exposed in numerous<br />
pits and shafts recently opened by<br />
local prospectors, where the highest grades<br />
appear to be over 20-30cm in width where<br />
the veins are currently exposed. Seven grab<br />
samples were collected from the veins and<br />
host rocks and assayed for gold. <strong>The</strong> best<br />
result returned 42 grams/tonne gold.<br />
<strong>The</strong> company’s CEO Stephen Promnitz<br />
says, “Indochine has four years of on-theground<br />
experience in Cambodia and has been<br />
able to acquire very prospective leases. While<br />
there has been little systematic exploration<br />
previously in Cambodia,<br />
the region is<br />
well known for<br />
world-class copper<br />
and gold discoveries,<br />
such as Chatree<br />
in Thailand, and<br />
Phu Kham and<br />
Sepon in Laos.<br />
“This drill program<br />
is a key step towards<br />
demonstrating<br />
the potential of our<br />
first gold discovery, Kratie North, where we<br />
seek high grade vein gold targets like the<br />
world-class 5+ million ounce Pogo mine in<br />
Alaska.”<br />
<strong>The</strong> Cambodian exploration program is led<br />
by David Meade, who has more than 15<br />
years experience in senior technical roles including<br />
leading exploration teams throughout<br />
South East Asia for some of the most successful<br />
ASX-listed companies in the region including,<br />
OZ <strong>Miner</strong>als and PanAust.<br />
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SE <strong>ASIA</strong>: Cambodia<br />
New drill program at Antrong<br />
THE preliminary round of drilling completed at<br />
the O’Thmey prospect of Brighton Mining<br />
Group’s Antrong project has provided positive<br />
geological information and interceptions. This<br />
drilling as well as data sourced from regional<br />
exploration results has generated further targets<br />
for the next round of drilling, which was<br />
due to start by the end of April.<br />
the current 1:2000 scale mapping further to<br />
the west as well as investigating the soil anomalies<br />
of 585ppb and 331ppb and planning<br />
a mapping and trenching program to unearth<br />
the cause of the anomalies.<br />
At the Ropoah concession Brighton plans to<br />
undertake infill soil sampling to highlight anomalous<br />
areas, trench the anomalies and map<br />
the area at 1:2000 scale. <strong>The</strong> company has<br />
own 11.2 million shares, equivalent to 50%,<br />
of Indochina Resources. In addition, PHI<br />
Gold will distribute 3 million Indochina shares<br />
stock to its shareholders.<br />
Indochina Resources will register with the Securities<br />
and Exchange Commission to become<br />
a separate publicly-traded company focused<br />
on industrial minerals and natural resources.<br />
AXN’s managing member Allen Wu says,<br />
“We look forward to working closely with PHI<br />
and its subsidiaries in expedited implementation<br />
of Indochina mining assets via organic<br />
growth as well as mergers and acquisitions.”<br />
PHI Group’s chairman Henry Fahman says,<br />
“Since AXN has already made significant progress<br />
in identifying and securing a number of<br />
properties in industrial minerals and natural resources<br />
in the wider region, we are confident<br />
that our joint cooperation will create tremendous<br />
synergy and unlock substantial value for<br />
shareholders of both companies and our related<br />
subsidiaries in the near future.”<br />
A Brighton Mining Group field team on site at one of the company’s Cambodian tenements.<br />
Holes drilled at O’Thmey South successfully<br />
intercepted massive sulphide and quartz veining<br />
comprising of pyrite, pyrrhotite, chalcopyrite<br />
and galena associated with strong<br />
argillic and haematitic alteration with disseminated<br />
pyrite and pyrrhotite.<br />
<strong>The</strong> overall downhole width of mineralization<br />
intercepted in the preliminary program is<br />
around 10 metres. <strong>The</strong> company expects to<br />
receive assay results in early May.<br />
Drilling the structural extension of the<br />
O’Thmey prospect and extending the known<br />
mineralization occurrences discovered at<br />
O’Thmey South prospect are the major aims<br />
of the new drilling program. It is expected that<br />
this program will include a similar number of<br />
metres of drilling to the preliminary program<br />
which comprised 19 holes.<br />
Between programs the company’s drilling<br />
contractor, Indodrill (Cambodia) Co, stowed<br />
its equipment at the Antrong campsite which<br />
gave Brighton a great advantage by saving<br />
time and money for demobilization and subsequent<br />
mobilization as well as providing the<br />
ability to begin drilling at short notice.<br />
Further work scheduled at and around Antrong<br />
in coming months includes extending<br />
previously completed soil and rock chip sampling<br />
at Ropoah with results highlighting areas<br />
of high-grade anomalous mineralization within<br />
the alteration zone of the Antrong granodiorite.<br />
In addition exploration work has also been<br />
planned to start at the King Roland north<br />
concession. This will include a detailed desktop<br />
study using ASTAR and TM imagery to<br />
highlight areas of interest, a stream sampling<br />
program and mapping at 1:10,000 scale.<br />
Indochina and AXN agreement<br />
INDOCHINA Resources has signed an agreement<br />
with AXN Group, LLC, a Delaware corporation,<br />
to cooperate in assembling and<br />
operating a portfolio of industrial minerals and<br />
natural resources in the South East Asia region<br />
including Vietnam, Laos, Cambodia, Myanmar,<br />
Thailand and Malaysia. Indochina is a<br />
subsidiary of PHI Gold Corporation, which is<br />
a majority-owned subsidiary of PHI Group.<br />
AXN and Indochina Resources will jointly<br />
organize, arrange, acquire, contribute and<br />
operate a portfolio of industrial minerals and<br />
other natural resources originated from the<br />
region for mutual benefits of both companies.<br />
Under the agreement, AXN Group will<br />
Focus on Kratie South<br />
THE exploration efforts of Southern Gold in<br />
Cambodia are focused on the Kratie South<br />
Joint Venture with Japan Oil, Gas and Metals<br />
National Corporation (JOGMEC). Follow-up<br />
work is being carried out at the Gossan prospect<br />
on the Preak Khlong tenement where<br />
work last year discovered high grade gold.<br />
Two drill holes at Gossan last year intersected<br />
two high-grade gold quartz veins that<br />
Southern Gold’s tenements are<br />
in eastern Cambodia.<br />
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SE <strong>ASIA</strong>: Cambodia<br />
occur with base metal bearing massive sulphides.<br />
Intersections included 2 metres from<br />
88 metres @ 1.47 grams/tonne gold, 0.23%<br />
zinc, 0.28% lead and 0.03% copper, and 3<br />
metres from 38 metres @ 14.6 grams/tonne<br />
gold, 0.5% zinc, 0.4% lead and 0.1% copper.<br />
Gossan is about 3km east of the Preak<br />
Khlong NW prospect where other significant<br />
gold intersections, including 3 metres @ 5.54<br />
grams/tonne, were identified earlier in 2010.<br />
<strong>The</strong> two prospects are about 15km south and<br />
along strike of OZ <strong>Miner</strong>als’ Okvau project.<br />
Two diamond core drill rigs were then mobilized<br />
to Kratie South and by the middle of<br />
the first quarter four holes had been drilled<br />
at Preak Khlong, five at Gossan and two at<br />
O’Ktung for a total of more than 2000 metres.<br />
Drill core has been logged and cut, and<br />
the company is expecting assay results during<br />
the current quarter.<br />
Exploration on Kratie South is fully funded by<br />
JOGMEC as part of the JV agreement whereby<br />
the Japanese Government-backed body can<br />
fund exploration activity to a total of US$3.029<br />
million over three years to<br />
earn a 51% interest.<br />
After withdrawing from the<br />
Kratie North project last year<br />
after meeting its minimum<br />
commitment of $500,000 but<br />
without earning an equitable<br />
interest, JOGMEC has focused<br />
on Kratie South and decided<br />
to continue with stage<br />
3 by investing a further<br />
US$1.4 million in order to<br />
earn its 51% interest.<br />
Exploration, including drilling,<br />
has also been carried<br />
out at the Memet project this<br />
year. <strong>The</strong> complete program<br />
includes 6000 metres of drilling<br />
and 4500 metres of trenching.<br />
At the Southern Gold<br />
100%-owned Snoul project<br />
drilling and trenching has been<br />
carried out this year with drill core logged and<br />
cut, and results expected this quarter.<br />
Exploration focus on Mesam<br />
THE Cambodian exploration efforts of OZ <strong>Miner</strong>als<br />
are focused on the Mesam area which<br />
abuts the company’s Okvau licence area. If<br />
these efforts prove successful OZ has the<br />
right to enter into a full joint venture to explore<br />
and develop the Mesam area, which it hopes<br />
will add to resources at Okvau.<br />
Results from exploration at Mesam will be<br />
taken into consideration as part of OZ <strong>Miner</strong>als’<br />
review of its gold assets in Cambodia. In late<br />
2010 the company entered into an agreement<br />
to conduct exploration over the Mesam area.<br />
During the first quarter seven holes of a 10<br />
hole program were completed. Most holes intersected<br />
gold mineralization associated with<br />
quartz veining over 1-2 metres. To date the<br />
more broadly dispersed mineralization seen<br />
at Okvau has not been intersected in significant<br />
quantities, however, further drilling is required<br />
to adequately test the system.<br />
Results include 2 metres from surface @<br />
2.2 grams/tonne gold and 1.77 metres from<br />
152.6 metres @ 39.85 grams/tonne from<br />
one hole; 1 metre from surface @ 37.9<br />
grams/tonne in another; and 2 metres from<br />
44 metres @ 2.9 grams/tonne, 1 metre from<br />
73 metres @ 0.94 grams/tonne and 2 metres<br />
from 136 metres @ 1.62 grams/tonne<br />
in a third hole.<br />
OZ <strong>Miner</strong>als began exploration in 2006 and<br />
has an exploration office in Phnom Penh.<br />
OZ <strong>Miner</strong>als’ exploration tenements in the Kingdom of Cambodia.<br />
Apart from Mesam, it has four exploration<br />
projects in Mondulkiri province and the most<br />
advanced of these is the Okvau project.<br />
An initial JORC-compliant inferred resource<br />
of 8.1 million tonnes @ 2.3 grams/tonne gold<br />
for 605,000 contained ounces was announced<br />
for Okvau more than 12 months ago and<br />
OZ <strong>Miner</strong>als is keen to identify further resources<br />
at and around Okvau to add to the resource<br />
inventory, which it hopes to add up to<br />
around 2 million ounces.<br />
<strong>The</strong> resource was outlined from 10,559<br />
metres of drilling undertaken since mid-<br />
2006. It was defined based on a geological<br />
model that extends 400 metres along strike<br />
and covers 500 metres of the width of the<br />
mineralized vein systems. <strong>The</strong> model is constrained<br />
down to a vertical depth of 400<br />
metres. <strong>Miner</strong>alization is open both to the<br />
southeast and at depth.<br />
Since the estimate was provided the company<br />
has focused on refining drill targets,<br />
identified within a series of high priority prospect<br />
areas all located within a 3km radius of<br />
the Okvau Resource but with little success.<br />
No significant results were returned from<br />
scout drilling at the Okvau North, Okvau<br />
Northwest and Area 6 prospects. It is a similar<br />
story at the O Khlek Khlok joint venture.<br />
Transol sells Liberty subsidiary<br />
TRANSOL Corporation has entered into a legally<br />
binding sale agreement of its whollyowned<br />
subsidiary Liberty Mining International<br />
and its controlled subsidiaries to non-related<br />
Canadian private interests. Finalization of the<br />
transaction will be subject to completion of<br />
due diligence and will also require shareholder<br />
approval. <strong>The</strong> sale of the Liberty Group<br />
will result in Transol not proceeding with the<br />
intended seed capital funding and proposed<br />
listing of Liberty onto the ASX.<br />
<strong>The</strong> sale terms involve payment of<br />
US$600,000 in cash; issue of 600,000 Class<br />
A common shares in an entity intending to list<br />
onto the TSX; a net smelter royalty of 2.5%<br />
on the Banlung, Banlung North, Oyadao and<br />
Oyadao South licences to a maximum aggregate<br />
payment of US$800,000; and the transfer<br />
of Maxum Metals, a 100% subsidiary of<br />
Transol, to the Liberty Group.<br />
It is intended that the purchasing entity will<br />
complete due diligence by the end of April<br />
2011 and, subject to a positive outcome,<br />
shareholder approval will be sought in late<br />
May or June. Transol will not proceed with<br />
the acquisition of the two projects held by<br />
Summer Gold in Cambodia - the Mondulkiri<br />
Gold Kang Roland licence of 136sqkm and<br />
the Oyadao Summer Gold licence of<br />
100sqkm. As a consequence, Summer<br />
Gold has agreed to fully repay Transol for<br />
the initial cost of acquisition, being<br />
US$350,000.<br />
Upon Transol receiving the cash proceeds<br />
from the sale of the Liberty Group and repayment<br />
of the funds from Summer Gold,<br />
Transol will have received US$950,000.<br />
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CHATREE EXPANSION ON TIME AND ON BUDGET<br />
EXPANSION of the processing plant at Kingsgate<br />
Consolidated’s Chatree Gold Project is on<br />
time and on budget with first gold expected<br />
during the September quarter.<br />
<strong>The</strong> expansion will take<br />
annual capacity from 2.3 million<br />
to 5 million tonnes and<br />
the company’s increase total<br />
annual production to around<br />
200,000 ounces. Thailand<br />
has been experiencing early<br />
wet season rainfall and, while<br />
having restricted some activities<br />
on site, construction activities<br />
for the plant expansion<br />
remain on schedule.<br />
Kingsgate received conditional<br />
approval in late March<br />
for the amended mine plan for<br />
the Chatree Gold Mine, which includes access<br />
to the higher grade C north pit area. However,<br />
the mining approval requires<br />
clarification and additional certification from<br />
the local and regional main roads authorities.<br />
With this additional delay access to higher<br />
grade ore in C North is now expected sometime<br />
during the current quarter and then positive<br />
impact of the higher grade ore from C<br />
North should now be felt in the second half<br />
of the calendar year.<br />
<strong>The</strong> delay will have an impact on production<br />
for the current financial year with full year gold<br />
production now expected to 125,000-<br />
130,000 ounces, which includes 85,000 to<br />
90,000 ounces from Chatree and around<br />
40,000 ounces attributable to Kingsgate from<br />
the Challenger mine in Australia for the five<br />
months from February 1, 2011.<br />
Group gold production for the March quarter<br />
totalled 32,973 ounces. <strong>The</strong> Chatree mine<br />
operations were restricted during the quarter<br />
and contributed 16,784 ounces. Challenger<br />
operations were affected by unseasonal rainfall<br />
following major cyclone activity in northern and<br />
central Australia but managed to produce<br />
24,900 ounces of gold for the quarter of which<br />
16,189 ounces are attributable to Kingsgate.<br />
Chatree is a world-class deposit which<br />
Kingsgate aims to continue mining for many<br />
years. World-class gold deposits generally<br />
have more than 5 million ounces and at present<br />
Chatree has about 6 million, including<br />
gold already mined, with the resource continuing<br />
to grow. As at June 30, 2010, it had a<br />
1.9 million ounce reserve and a 4.3 million<br />
An aerial view of the expansion projects at Kingsgate’s Chatree project.<br />
<strong>The</strong> Kingsgate processing plant at the Chatree Gold Project.<br />
ounce resource. It also has low operating<br />
costs of around US$341 an ounce plus a<br />
US$117 Thai royalty. Apart from the expansion<br />
of open pit operations at Chatree, the<br />
project also has underground potential<br />
which Kingsgate is investigating.<br />
Meanwhile, Kingsgate’s Thai subsidiary<br />
Akara Mining has postponed a proposed initial<br />
public offering on the Thai bourse, which<br />
it says is due to concerns about Thailand’s<br />
long-running political problems. It had expected<br />
to list in the fourth quarter of 2010 but this<br />
has now been put back by 12 months. Akara<br />
is expected to have market capitalization of<br />
about 10 billion baht (US$326 million) and has<br />
licences to explore for gold in Phichit and<br />
Phetchabun provinces, north of Bangkok.<br />
Southeast Asia exploration resumes<br />
EXPLORATION work has re-commenced on<br />
Southeast Asia Mining’s Special Prospecting<br />
Licences (SPLs) in Thailand which are held by<br />
its operating subsidiary, Geotai Exploration<br />
and Mining Co. <strong>The</strong> main objective is to define<br />
mineral reserves of molybdenum, lead,<br />
zinc and copper.<br />
<strong>The</strong> exploration period has been granted for<br />
five years on all Geotai SPLs with GMT Corporation<br />
contracted to assist with the program<br />
planning, field supervision, core logging, and<br />
sampling and data compilation and analysis.<br />
<strong>The</strong>re are two SPLs in Chanthaburi province<br />
with exploration under way on each. Diamond<br />
drilling is being conducted at one of these<br />
SPLs on the first of three target areas of anomalous<br />
zones at depths of 80 to 120 metres<br />
as follow-up work on surface exploration to<br />
define geochemical anomalous zones of molybdenum,<br />
lead, zinc and copper.<br />
<strong>The</strong>re are two zones of geophysical anomalies,<br />
the first zone is trending NE-SW<br />
about 700 metres wide and 1400 metres in<br />
length with the second zone trending NE-<br />
SW about 50 metres wide and 850 metres<br />
long. <strong>The</strong> anomalies are hosted in grey, coarse<br />
grained biotite granite, quartz veinlets<br />
about 1cm to 15cm thick.<br />
On the other Chanthaburi SPL Geotai has<br />
completed surface geological<br />
mapping and geochemical<br />
soil surveying along<br />
assigned survey lines. According<br />
to previous work,<br />
soil geochemical surveys<br />
show geochemical anomalies<br />
of molybdenum, lead,<br />
antimony, zinc and copper.<br />
<strong>The</strong> area is underlain by grey<br />
subarkosic sandstone, mudstone<br />
and conglomerate of<br />
Ck1 rock unit of Triassic age.<br />
Properties containing high<br />
levels of molybdenum and<br />
antimony have been found in<br />
this area and mined.<br />
In Kanchanaburi province Geotai has begun<br />
preliminary surface geological surveying including<br />
Landsat interpretation, airborne geophysical<br />
interpretation, surface geological<br />
mapping, geochemical surveying and chemi-<br />
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SE <strong>ASIA</strong>: Thailand<br />
cal analysis. <strong>The</strong> two SPLs are close to the<br />
lead-zinc mines of KEMCO Ltd. <strong>The</strong> ore is<br />
combined lead-zinc with silver credits.<br />
<strong>The</strong> deposit has been defined as a stratabound<br />
massive sulphide and mineralization<br />
has been defined within Ordovician limestone<br />
similar to the Mississippi Valley in US. Structurally,<br />
the rock has been folded to a synclinal<br />
form with the fold axis plunged to the SE direction.<br />
<strong>The</strong> area has been bounded on both<br />
sides by the NW-SE faults/fractures. On the<br />
eastern part, a fault contact between Ordovician<br />
limestone and Triassic rocks is presented.<br />
Southeast Asia’s president and CEO Kerry<br />
Smith says, “We are excited to be conducting<br />
exploration. <strong>The</strong> Chanthaburi molybdenum<br />
site has the potential to be a major asset in<br />
the company's portfolio. <strong>The</strong> Kanchanaburi<br />
SPLs are in an area with historical lead-zinc<br />
deposits and warrant serious exploration.”<br />
Lease expected for Ka Ber Din<br />
THE strategic alliance between Australia’s Artist<br />
& Entertainment Group (AEG) and Thai<br />
company 99Co expects to receive a lease to<br />
mine shortly for the Ka Ber Din thermal coal<br />
project in the Om Koi District, Chiang Mai<br />
province, northwest Thailand.<br />
Upon approval of the licence, AEG, as a foreign<br />
investor, will participate up to a maximum<br />
of 49% in the project as an incorporated JV<br />
company. <strong>The</strong> joint venture may also then<br />
seek to acquire additional prospective land in<br />
surrounding areas while there are also opportunities<br />
to access further resources in an area<br />
20km southeast of the project. <strong>The</strong>re is also a<br />
large coal outcrop across the Myanmar border<br />
in an area that is cut off from the rest of Myanmar<br />
by a mountain range.<br />
99Co has started a concept study on the<br />
proposed development of a coal-fired power<br />
generation plant in conjunction with the Ka<br />
Ber Din mine. <strong>The</strong> power plant strategy offers<br />
significant savings in road construction, maintenance,<br />
transport and related costs.<br />
<strong>The</strong> Electricity Generating Authority of Thailand<br />
is receptive to power plant development<br />
and the potential for energy offtake. Coal is<br />
in high demand in Thailand, which has limited<br />
coal supplies and is highly dependent on imports,<br />
mainly from Indonesia.<br />
<strong>The</strong>re are two main seams at Ka Ber Din –<br />
the UC seam and the LC seam. <strong>The</strong> UC coal<br />
is ranked as sub-bituminous B and on an airdried<br />
basis has inherent moisture of 12.17%,<br />
ash content of 14.11%, volatile matters of<br />
40.54%, fixed carbon of 33.17%, total sulphur<br />
of 1.35% and calorific value of 4671<br />
kcal/kg. <strong>The</strong> LC coal is ranked sub-bituminous<br />
A and on an air-dried basis has inherent<br />
moisture of 5.82%, ash content of 19.75%,<br />
volatile matters of 40.55%, fixed carbon of<br />
33.87%, total sulphur of 2.29% and calorific<br />
value of 4586 kcal/kg.<br />
<strong>The</strong> coal meets domestic consumption parameters.<br />
If mined, coal will be supplied to<br />
Thai power plants and can also be used as<br />
feedstock to drive the proposed on-site<br />
power plant. <strong>The</strong> regional power grid runs<br />
about 5-6km from the proposed mine site.<br />
AEG has changed its business direction in<br />
the past 12 months with a new focus on<br />
energy related activities and to this end is<br />
now seeking to change its name to Asia<br />
Energy and <strong>Miner</strong>als Ltd. It is seeking to acquire<br />
Tiger Energy, which has the Wallawi oil<br />
and gas field near Balikpapan in East Kalimantan,<br />
Indonesia.<br />
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AEG has also been following up on an oil<br />
and gas exploration project in Cambodia and<br />
is negotiating with the government under a<br />
PSC arrangement.<br />
Amanta seeks new licences<br />
AMANTA Resources has applied for a new<br />
Special Prospecting Licences (SPL) covering<br />
the anomalous areas of the Langu Gold Project<br />
as well as those areas over which mapping<br />
and sampling have rendered positive<br />
results. <strong>The</strong> new application is under consideration<br />
by the Thai Department for Primary<br />
Industries and Mining for approval.<br />
Langu, in the far south of Thailand, originally<br />
consisted of four SPLs but two of the licences<br />
expired on July 2, 2009 and the company<br />
has reapplied over 640 hectares of the<br />
same general ground for one new SPL, thereby<br />
relinquishing areas that do not warrant<br />
further work. <strong>The</strong> remaining two SPLs are<br />
valid until September 28, 2011.<br />
<strong>The</strong> company has completed extensive surface<br />
work on the Langu property, including<br />
geochemical sampling and geological mapping,<br />
trenching and induced polarization. Results<br />
received to date appear to confirm that<br />
an anomalous gold trend extends for more<br />
than 6000 metres along a north-south strike.<br />
Phase 1 of a 10,000 metre drill program has<br />
been completed on the property.<br />
Amanta has also applied for two SPLs at<br />
the Surat prospect, which is near the town of<br />
Surath Thani and to the north of Langu. <strong>The</strong><br />
area appears to have Langu-style mineralization<br />
in a similar setting as the Langu project.<br />
<strong>The</strong>se applications are under consideration<br />
by Thai authorities.<br />
<strong>The</strong> company also has several tungsten<br />
properties in northern Thailand, including Mae<br />
Lama and Mae Chedi. It has completed extensive<br />
surface work at Mae Lama, followed<br />
by a limited initial drilling program when 18<br />
core drill holes were completed for a total drilled<br />
depth of 2958 metres.<br />
Global Prospectors and Consultants, a Thai<br />
mining services company, rehabilitated part<br />
of the former mine workings and additional<br />
rehabilitation work is required at a future date.<br />
<strong>The</strong> owner of the property, with whom<br />
Amanta has an agreement to acquire a<br />
100% working interest in the project, has applied<br />
for an extension to the original mining<br />
licence, the initial term of which has now expired.<br />
Activities at the site will recommence<br />
when the extension is granted. In December<br />
2007, Amanta was granted an SPL covering<br />
14sqkm in the Mae Chedi area. <strong>The</strong> project<br />
is in Chiang Rai Province and is the location<br />
of a former tungsten/tin mining operation. To<br />
date, the company has completed a limited<br />
surface sampling and mapping program.<br />
Matsa awaits concession licences<br />
MATSA Resources is gearing up to begin exploration<br />
activities, with the expectation that<br />
many of its tenement applications in Thailand<br />
will be granted after the upcoming elections.<br />
<strong>The</strong> company has applied for a total of<br />
1349sqkm of licences prospective for gold,<br />
iron ore and copper. With Thailand’s Parliament<br />
to be dissolved in May, it is hoped that<br />
an election will be held shortly after and that<br />
this will result in progression of many prospecting<br />
licence applications that have been<br />
made, including those of Matsa.<br />
<strong>The</strong> company has a strategy of seeking<br />
world-class exploration and mining opportunities<br />
in Australia and South East Asia where<br />
a number of Australian companies have been<br />
highly successful over the past decade. This<br />
strategy of working in Thailand shows exciting<br />
potential with Matsa’s applications including<br />
the KT prospect, which is adjacent and<br />
near to Kingsgate Consolidated’s 6 million<br />
ounce Chatree Gold Project.<br />
In Australia Matsa is developing relationships<br />
and potential partnering agreements<br />
with China Kinwa Technology aimed at putting<br />
its Norseman Gold Project into production.<br />
This relationship could also benefit the<br />
company’s Thai interests with a joint venture<br />
likely to also assess other resource sector<br />
opportunities in Thailand.<br />
Matsa’s Thailand office is ready to begin exploration<br />
immediately on the granting of the<br />
tenements. While it is difficult to obtain licences<br />
for exploration and mining, it seems<br />
Matsa has the capacity to overcome these<br />
barriers to entry due to its highly qualified and<br />
experienced Thai office staff.<br />
<strong>The</strong> KT project totals 170sqkm in 11<br />
SPLAs, 18km east of Chatree. <strong>The</strong> applications<br />
include 32sqkm that has had extensive<br />
first pass surface exploration. This has defined<br />
co-incident gold, silver and multi-element<br />
anomalies each over about 2.5km by 1.5km<br />
in area. Government records indicate diamond<br />
drilling within the State Forest only 100<br />
metres from the project boundary had intersected<br />
6 metres @ 2.42 grams/tonne gold<br />
from 60 metres depth.<br />
<strong>The</strong> Paisali project further to the south totals<br />
788sqkm. It was selected initially by inspection<br />
of small-scale iron occurrences and observation<br />
of recent exploration drilling on prospecting<br />
permits. Geological interpretation and field<br />
inspection defined a larger prospective area<br />
covering potential host rocks and interpreted<br />
mineralizing structures which correlated well<br />
with ground magnetic surveys.<br />
<strong>The</strong> Chondaen Copper Project totals<br />
387sqkm2 and was selected based on geochemical<br />
data and work completed to date<br />
by Matsa’s Thai geological staff. It is believed<br />
to have potential for copper mineralization<br />
in a sequence of andesitic volcanic and<br />
shallow intrusives.<br />
A sulphide rich outcrop at a road cutting on Amanta Resources’ Langu Gold Project.<br />
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COMMISSIONING OF EXPANDED RAUB PLANT DELAYED<br />
DELAYS in supply and delivery of some key<br />
equipment together with recent heavy rains<br />
have seen commissioning of the expanded<br />
circuit at Peninsular Gold’s Raub project put<br />
back to the current quarter.<br />
Peninsular’s chairman and chief executive<br />
Dato Sri Andrew Kam says as a result of the<br />
delay and the slightly lower grade being<br />
mined, results for the full year to June 30 may<br />
be lower than expected by the market.<br />
“Once the CIL circuit is completed it will be<br />
commissioned on tailings whilst the additional<br />
crushing and milling circuit is built to enable<br />
the inclusion of primary ore which remains<br />
targeted for quarter four of 2011.”<br />
<strong>The</strong> current Raub CIL plant is operating<br />
above expectation with a total of 610,850<br />
tonnes being treated while 8734 ounces of<br />
gold were produced in the six months to December<br />
31 and in spite of the lower grade<br />
being processed, recovery averaged 74%.<br />
<strong>The</strong> head grade processed from areas currently<br />
being mined, has been 0.6 grams/tonne<br />
on average, which is about 0.1 grams tonne<br />
lower than the overall tailings average. <strong>The</strong><br />
average cash cost per ounce for the period<br />
was about US$614, reflecting the impact of<br />
the slightly lower grade. As the grade returns<br />
to the overall tailings average the company expects<br />
the average cash cost to come down.<br />
<strong>The</strong> current tailings areas being mined are<br />
also enabling the preparation of the next tailings<br />
storage facility. This will be required when<br />
the current facility is full and will store processed<br />
material from both the tailings and also primary<br />
ore. <strong>The</strong> primary ore is expected to start<br />
being mined during the fourth quarter of 2011.<br />
Exploration and drilling programs are under<br />
way at Raub and at Tersang, in the northern licence<br />
areas about 15km to the north of Raub.<br />
Exploration at Raub is focused on definition<br />
of new resources below the oxidized and intermediate<br />
zones where 218,000 ounces were<br />
previously estimated. <strong>The</strong> zone being investigated<br />
is deeper within the recognized lode<br />
structure and drilling is being conducted by<br />
diamond drilling with three rigs in operation.<br />
<strong>The</strong> principal drilling area at present is the primary<br />
mineralization zone between Bukit Malacca<br />
North and Bukit Ward where significant<br />
widths of near surface mineralization have been<br />
recorded in earlier RC and recent diamond drilling.<br />
This drilling will test the probable extensions<br />
to the known mineralization and will test<br />
beneath the former underground workings.<br />
<strong>The</strong> exploration and drilling objective at<br />
Tersang is to define the initial resources to<br />
JORC standard by the end of the third quarter.<br />
This will be followed by a further drilling<br />
program estimated at 20,000 metres of reverse<br />
circulation and 2000 metres of diamond<br />
drilling aimed at completion of the<br />
Tersang resource definition.<br />
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Selinsing gold plant capacity to increase 250%<br />
MONUMENT Mining is going ahead with the<br />
phase III expansion for its Selinsing mine and<br />
gold treatment plant. <strong>The</strong> expansion will take<br />
annual capacity to 1 million tonnes and will include<br />
an additional milling, gravity and leach<br />
circuit. <strong>The</strong> decision to proceed follows Monument<br />
having successfully reached commercial<br />
production with its 400,000 tonne gold treatment<br />
plant and building cash reserves.<br />
<strong>The</strong> 250% expansion in production capacity<br />
will be funded from current cash reserves,<br />
is expected to cost less than Can$8 million<br />
and will result in a projected pay-back of three<br />
months from operating cash flow. <strong>The</strong> expansion<br />
is scheduled to reach practical completion<br />
by the end of 2011 and be in full<br />
operation by April 2012.<br />
<strong>The</strong>re will be some disruption to the present<br />
operations during construction and commissioning<br />
of the new equipment, however the<br />
company projects annual gold production will<br />
remain at 40,000 ounces for the year ending<br />
June 30, 2011 and increase to 50,000 ounces<br />
for the year ending June 30, 2012.<br />
Monument will make further announcement<br />
on the projected gold production targets from<br />
June 2012 onwards pending plant commissioning<br />
and the 2011 exploration program resulting<br />
in a new reserve and resource statement.<br />
<strong>The</strong> development and construction of the<br />
current mine and processing facility has<br />
shown the company has built the capability<br />
to design, permit and construct low cost and<br />
efficient treatment facilities. This owner capability<br />
will be utilized to project manage the<br />
phase III expansion.<br />
<strong>The</strong> treatment plant at Monument Mining’s Selinsing Gold Project in Malaysia.<br />
Monument’s Selinsing general manager<br />
Kevin Wright, who oversaw the construction<br />
of the existing mine and mill, says, “This<br />
plant will not only provide an increase in production<br />
capability and operating efficiency<br />
but will also provide necessary operating flexibility<br />
for processing blended feed as the<br />
operations mature.<br />
“Extensions to the ore zones identified by<br />
our exploration efforts along strike and<br />
down dip are likely to produce an increase<br />
in variability of ore types and our in-house<br />
design team has taken this into account”.<br />
<strong>The</strong> overall objective of the current exploration<br />
program is to convert existing inferred<br />
resources to reserves, add replacement ore<br />
and increase reserve and resource ounces<br />
with a target to exceed 1 million ounces to<br />
demonstrate at least a 10 year mine life.<br />
This will be facilitated through the drilling of<br />
about 19,000 metres of drilling in the next<br />
12 months with four in-house rigs and one<br />
contract diamond drill rig.<br />
<strong>The</strong> company has an approved exploration<br />
budget of $4.4 million for this year, including<br />
two new diamond drill rigs, and has<br />
been ramping up exploration capacity. In<br />
addition to the in-house team comprising an<br />
experienced VP of exploration, an exploration<br />
manager and a team of four field geologists<br />
and five pit production geologists,<br />
the company is assembling additional drilling<br />
crews so that its four in-house drill rigs<br />
can operate on a two-shift per day basis.<br />
<strong>The</strong> next reserve and resource report is<br />
due for announcement in quarter four of<br />
2011.<br />
Bau drilling program of 20,000 metres<br />
AN exploration and resource drill program of<br />
20,000 metres is under way at Olympus Pacific<br />
<strong>Miner</strong>als’ Bau Gold Project in Sarawak,<br />
East Malaysia. <strong>The</strong> aim of the program is to<br />
expand NI 43-101 reserve and resource estimates<br />
through exploration of known deposit<br />
extensions and new target zones.<br />
<strong>The</strong>re have been about 10 selected conductivity<br />
anomalies identified at depths of 300<br />
to 700 metres below the current resource.<br />
Subsequent to Olympus’ purchase of Bau<br />
in December 2009, resources were independently<br />
estimated at 560,000 measured and<br />
indicated ounces, and 1.89 million inferred<br />
ounces. <strong>The</strong>se resources include several different<br />
mineralization styles in multiple deposits<br />
that have to date been drilled only to<br />
shallow depth and remain open to expansion<br />
through continuing exploration.<br />
Reprocessing of airborne DIGHEM geophysical<br />
data within a central area of the goldfield<br />
have since revealed several strong conductivity<br />
anomalies, which show remarkable coincidence<br />
with conjugate fault intersections and<br />
with the surface location of historic gold mines.<br />
Several interpretations are possible with one<br />
being that they represent the expression of<br />
large, mineralization systems extending to<br />
more than 700 metres below surface. <strong>The</strong>y<br />
constitute compelling drill targets.<br />
<strong>The</strong> 2011 exploration and feasibility study<br />
program follows up 5680 metres completed<br />
over 29 holes in late 2010.<br />
Resource drilling to date has focused on<br />
the Taiton-A deposit, which features gold-mineralized<br />
massive calcite veins and hydrothermal<br />
vein/breccias hosted within the<br />
NE-SW trending Tai Parit Fault zone and<br />
cross-cutting vein structures. Historic and<br />
current drilling has delineated the main zone<br />
along 800 metres of strike.<br />
Selected Taiton-A intercepts include 19 metres<br />
@ 5.20 grams/tonne gold, 9.9 metres @<br />
14.11 grams/tonne, 2 metres @ 31.41<br />
grams/tonne, 30.13 metres @ 9.07 grams/<br />
tonne and 22.26 metres @ 4.5 grams/tonne.<br />
Current drilling is designed to upgrade and<br />
expand the zone along strike and within the<br />
100-300 metre depth range.<br />
Exploration drilling has also yielded highly encouraging<br />
results. Although the program is far<br />
from complete and only partial assay results<br />
are on hand, intercepts of potentially economic<br />
width and grade have been returned from two<br />
separate prospect localities – Arong Bakit and<br />
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SE <strong>ASIA</strong>: Malaysia<br />
Tabai. At the former best intercepts are 12.13<br />
metres @ 2.5 grams/ tonne and 5.7 metres @<br />
1.08 grams/tonne. At Tabai best intercepts are<br />
8 metres @ 1.76 grams/tonne, 3 metres @<br />
8.73 grams/tonne and 2.5 metres @ 18.64<br />
grams/tonne.<br />
Positive indications of mineralization<br />
have been seen in several holes<br />
that have tested the deep geophysical<br />
conductivity targets. Studies are<br />
under way to utilize data from these<br />
holes to help target potential gold<br />
rich zones within the porphyry, and<br />
surrounding host rocks at depth.<br />
Rare earths LAMP on schedule<br />
CONSTRUCTION of the Aus$230<br />
million Lynas Advanced Materials<br />
Plant (LAMP) at Gebeng, near Kuantan<br />
on Malaysia’s east coast, remains<br />
on track for first production of rare<br />
earths in the third quarter of 2011. It will be<br />
the first rare earths processing plant built outside<br />
China in nearly 30 years.<br />
Lynas Corporation expects the LAMP will<br />
meet almost a third of the world’s demand for<br />
the minerals within two years, excluding<br />
China. It believes the plant, along with the<br />
company’s Mount Weld mine and concentration<br />
plant in Western Australia will help break<br />
China's dominance of the rare earths market.<br />
Construction of the kilns at the Lynas Advanced Materials Plant (LAMP) in Malaysia.<br />
China supplies more than 90% of global rare<br />
earths supply, although its reserves represent<br />
33% of the global total. But China's tightening<br />
grip on the minerals and their export has raised<br />
overseas concern over supply security.<br />
At current prices, the Lynas refinery is expected<br />
to generate $1.7 billion worth of exports,<br />
nearly 1% of Malaysia’s economy, starting<br />
late in 2012. Lynas plans to ship ore to<br />
Malaysia from Mount Weld.<br />
Engineering has progressed well with deliverables<br />
on schedule to be issued by<br />
the end of March. Steelwork has<br />
been issued for detailing and concrete<br />
drawings issued for construction.<br />
Procurement of equipment<br />
packages remains on schedule with<br />
delivery of equipment to Kuantan in<br />
preparation for installation on site,<br />
ramping up.<br />
Construction activities are in full<br />
swing with more than 1000<br />
people on site. Concrete has<br />
been poured and structural steel<br />
is being installed. Installation of<br />
kilns has enabled multiple trades to<br />
mobilize to the site.<br />
Lynas has received a ‘no objection’ letter<br />
from Australia’s Foreign Investment Review<br />
Board regarding investments in Lynas by a<br />
special purpose company involving Sojitz<br />
Corporation and JOGMEC.<br />
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Mongolia<br />
RARE EARTHS JOINT VENTURE EVALUATES FOUR SITES<br />
JUST days after announcing a letter of intent<br />
to help develop a third new rare earth mining<br />
property in Mongolia, the joint venture formed<br />
by Green Technology Solutions and Rare<br />
Earth Exporters of Mongolia (REE) signed up<br />
to evaluate a fourth site.<br />
<strong>The</strong> joint venture’s agent company signed<br />
a letter of intent to help finance, market and<br />
develop a new mineral-rich site in Bulgan<br />
province, northern Mongolia. <strong>The</strong> property is<br />
part of the Dashinchilen district, home to a<br />
population of about 2300.<br />
<strong>The</strong> letter was co-signed by the executive<br />
director of Bouo LLC, the company that<br />
owns the property’s mining rights. Green<br />
Technology and REE now have the right to<br />
scientifically evaluate the site’s mining potential<br />
in performing due diligence toward a definitive<br />
agreement. Bouo LLC will retain<br />
authority to mine the location with the joint<br />
venture entitled to a share of the profits.<br />
<strong>The</strong> Bulgan site is the fourth Mongolian<br />
property being evaluated by the joint venture.<br />
It is also analysing two sites in the country’s<br />
Tuv province and another in Dornogobi<br />
province. <strong>The</strong> latter sees the joint venture<br />
working with Modot Uul LLC, the company<br />
owning the mining rights for the site, on a<br />
similar basis to Bouo.<br />
Green Technology’s president and CEO<br />
John Shearer says, “Our joint venture has already<br />
commissioned mineral analysis of the<br />
soil at the Dornogobi property, and we expect<br />
that the results will resoundingly confirm the<br />
economic viability of mining rare earths there.”<br />
In the letter of intent, Modot Uul claims that<br />
the property contains rare earth elements including<br />
scandium, yttrium, ytterbium and lanthanum.<br />
Among many applications, the<br />
metals are in high demand for usage in aerospace<br />
components, superconductors, infrared<br />
lasers and fluid catalytic cracking<br />
catalysts in oil refineries.<br />
John Shearer says the Bouo deal will likely<br />
be the joint venture’s last letter of intent<br />
signed in Mongolia until it is able to review the<br />
mineral contents of each site. “We will continue,<br />
however, to seek out promising rare<br />
earth mining properties throughout the country<br />
and elsewhere.<br />
“We feel strongly that Mongolia will be the<br />
world’s next great producer of rare earth elements,<br />
and we’re investing aggressively to<br />
help achieve that vision. Mongolia is the key to<br />
our plans to help break China’s stranglehold<br />
on the world’s supply of rare earth elements.”<br />
A minerals lab will analyse the Bulgan site’s<br />
properties and report to the joint venture how<br />
many grams/tonne of the soil comprise rare<br />
earth elements.<br />
Green Technology and REE planned to ship<br />
their first batch of rare earth ore from Mongolia<br />
to the international seaport of Vladivostok,<br />
Russia, during April.<br />
Drilling at Xanadu Mines’ Galshar Coal Project in Mongolia’s central east.<br />
Thick coal seams at Galshar<br />
THE first holes of an extensive exploration<br />
drilling program at Xanadu Mines’ Galshar<br />
Coal Project 250km southeast of Ulaanbaatar<br />
have confirmed seam thicknesses of about 20<br />
metres. Dilling began in early March with two<br />
diamond rigs operating on a double shift basis.<br />
A coal exploration target of 175 million to<br />
225 million tonnes has been set at Galshar<br />
and the aim of the 36-hole drilling program is<br />
to enhance and extend that target into a<br />
JORC-compliant resource.<br />
Xanadu expects the first phase of the program<br />
will take at least two months and that it<br />
may then be expanded to allow for more detailed<br />
JORC reserve drilling in priority areas.<br />
A field camp has been set up to support the<br />
drilling and other exploration, which includes an<br />
excavator trenching program and a detailed regional<br />
topographic survey of the Galshar basin.<br />
A ground magnetic survey is also under way.<br />
Xanadu’s chairman Brian Thornton says, “In<br />
addition to Galshar, the company has embarked<br />
on an aggressive program to evaluate<br />
a number of coal and potential porphyry copper<br />
opportunities across the south and the<br />
north of the country.<br />
“Xanadu has previously announced it aims<br />
to spend about $6m on exploration in 2011 on<br />
existing and new projects, in addition to exploration<br />
spending on coking coal and iron ore as<br />
part of the Noble-Xanadu strategic alliance.”<br />
<strong>The</strong> terms of the alliance to explore and develop<br />
coking coal, iron ore and ferro alloy opportunities<br />
in Mongolia were finalized in mid-<br />
April. Xanadu and Noble will participate in the<br />
alliance through a joint venture company with<br />
each party holding a 50% interest. Xanadu’s<br />
existing assets are not part of the alliance.<br />
<strong>The</strong> initial focus will be the pursuit of a number<br />
of identified opportunities and the alliance<br />
will seek to maximize the benefits of Xanadu’s<br />
and Noble’s respective country experiences<br />
and strengths.<br />
Meanwhile, Xanadu’s wholly-owned subsidiary,<br />
Xanadu Metals Mongolia LLC, has acquired<br />
all issued capital of Soduntag LLC,<br />
which has given Xanadu ownership of the advanced<br />
Mogoin Gol porphyry copper project.<br />
Mogoin Gol is one of Mongolia’s most<br />
prospective porphyry copper opportunities.<br />
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Mongolia<br />
It is in Bulgan province, about 230km northwest<br />
of Ulaanbaatar and about 40km northwest<br />
of the Erdenet porphyry coppermolybdenum<br />
deposit.<br />
Erdenet is Mongolia’s largest operating copper<br />
mine, annually producing about 530,000<br />
tonnes of copper concentrate with measured<br />
and indicated resources of 4.7 million<br />
tonnes. It has it own rail infrastructure<br />
which connects with the<br />
Trans-Mongolian railway.<br />
Detailed induced polarization,<br />
ground magnetic and gravity surveys<br />
will begin shortly with an aggressive<br />
drilling program planned<br />
for late in the 2011 field season.<br />
New discovery north of Oyu Tolgoi<br />
IVANHOE Mines and BHP Billiton<br />
have discovered a new zone of<br />
shallow copper-molybdenum-gold<br />
mineralization about 10km north of<br />
Ivanhoe’s massive Oyu Tolgoi coppergold<br />
mining complex under construction in<br />
southern Mongolia.<br />
<strong>The</strong> discovery of Ulaan Khud North extends<br />
the known strike length of the Oyu Tolgoi mineralized<br />
system by an additional 3km to the<br />
north, to more than 23km.<br />
Less than half of the mineralized trend at<br />
Oyu Tolgoi has been extensively drill-tested to<br />
date. An ongoing exploration program including<br />
proprietary, induced-polarization technology,<br />
has identified additional exploration and<br />
development targets.<br />
Ivanhoe’s executive chairman and chief executive<br />
officer Robert Friedland says, “<strong>The</strong><br />
Ulaan Khud North discovery reinforces our<br />
longstanding belief that with continued exploration<br />
there is excellent potential to discover<br />
new porphyry deposits, rich in copper and<br />
gold, which are associated with the worldclass<br />
Oyu Tolgoi mineralized trend.”<br />
Ulaan Khud North is on a 19,625-hectare<br />
exploration licence that is part of Ivanhoe's<br />
joint-venture partnership with BHP Billiton,<br />
which was formed in 2005. BHP Billiton has<br />
earned a 50% interest in the joint venture by<br />
spending US$8 million in exploration costs<br />
and conducting an airborne survey using<br />
the proprietary Falcon gravity gradiometer<br />
system over the Oyu Tolgoi area.<br />
A total of 25 drill holes totalling 6561 metres,<br />
ranging in depth from 182 metres to 377<br />
metres, defined the new zone of shallow porphyry<br />
copper mineralization over an area of<br />
600 metres by 300 metres. <strong>The</strong> zone starts<br />
beneath 60 to 80 metres of Cretaceous clay<br />
and gravels, indicative of a near-surface deposit<br />
with open-pit mining potential. Ivanhoe's<br />
geologists believe that the near-surface<br />
copper mineralization discovered may be part<br />
of a much larger deposit.<br />
Many holes encountered mineralization with<br />
Core from the Ulaan Khud North prospect.<br />
greater than 1% copper in multiple individual<br />
one-metre samples, while almost all holes<br />
have longer intervals of mineralization grading<br />
greater than 0.3% copper.<br />
Highlights include 19 metres from 155 metres<br />
@ 0.941% copper, 0.098 grams/tonne<br />
gold and 0.029% molybdenum for a copper<br />
equivalent of 1.158%; 9.6 metres from 208.1<br />
metres @ 2.429% copper, 0.121 grams/<br />
tonne gold and 0.149% moly for copper<br />
equivalent of 3.3%; and 7.65 metres from<br />
174.35 metres @ 2.242% copper, 0.203<br />
grams/tonne gold and 0.081% moly for copper<br />
equivalent of 2.803%.<br />
<strong>The</strong> mineralization at Ulaan Khud North<br />
starts as shallow as 60 metres below surface,<br />
much higher than the mineralized zone at<br />
Hugo Dummett to the south. <strong>The</strong> fact that<br />
Ulaan Khud North occurs in similar Devonian<br />
host rocks to Hugo Dummett suggests that<br />
the main Oyu Tolgoi porphyry system trend is<br />
relatively shallow in this area and that potential<br />
for surface-mineable targets still exist<br />
within the Oyu Tolgoi trend and Ulaan Khud<br />
North in particular. <strong>The</strong> Ulaan Khud North<br />
property adjoins the Shivee Tolgoi Entree<br />
Gold-Ivanhoe Mines joint-venture property<br />
and is about 3km north of mineralization<br />
found at Ulaan Khud on that licence.<br />
Banpu takes share in Hunnu<br />
HUNNU Coal has signed a strategic partnership<br />
with major Asian energy company<br />
Banpu which will help Hunnu explore and develop<br />
its suite of Mongolian coal assets. Following<br />
the acquisition by Banpu's whollyowned<br />
subsidiary, Banpu <strong>Miner</strong>al Resources,<br />
Banpu will be the biggest shareholder in<br />
Hunnu with 12.39%.<br />
Hunnu has established a strong position in<br />
thermal and coking coal deposits in South<br />
Gobi, Mongolia, and is undergoing<br />
extensive exploration for 10 coal<br />
projects, two of which has a combined<br />
coal resources of more than<br />
400 million tonnes. <strong>The</strong> funding<br />
provided by the investment will be<br />
used to further fast track the development<br />
of these two advanced<br />
properties - Tsant Uul and Unst<br />
Khudag.<br />
Banpu has operations in Thailand,<br />
Indonesia, China and Australia, and<br />
currently produces more than 40<br />
million tonnes of coal annually. <strong>The</strong><br />
investment in Hunnu will provide it<br />
with exposure to Mongolia’s lucrative<br />
coal industry.<br />
As well as acquiring 30 million shares in<br />
Hunnu for total consideration of Aus$45 million,<br />
the Thai-based company will nominate a<br />
representative to Hunnu’s Board and support<br />
development of Hunnu’s Mongolian assets.<br />
Banpu’s CEO Chanin Vongkusolkit says<br />
Banpu is seeking to be a long-term player in<br />
the growth and development of Hunnu and<br />
the Mongolian coal sector.<br />
“Hunnu is a well managed business with a<br />
clear strategy and great prospects. <strong>The</strong><br />
strategic partnership with Hunnu is an effective<br />
way for Banpu to partner with Hunnu for<br />
the long-term benefit of both companies.<br />
“<strong>The</strong> Mongolian coal sector has great potential,<br />
with extensive coal deposits and rapidly<br />
developing infrastructure. Its close proximity to<br />
key coal export markets such as China makes<br />
it an attractive investment destination.<br />
“A strategic partnership with Hunnu is a<br />
lower-risk way for Banpu to familiarize itself<br />
with the Mongolian coal industry. Establishing<br />
a strategic alliance in Mongolia is part of<br />
Banpu’s strategy to expand its position in key<br />
Asia Pacific markets.<br />
“We are strongly supportive of Hunnu’s<br />
management team and its current strategy,<br />
and the alliance will allow Banpu to share operational<br />
expertise.”<br />
TVET tackles skills shortage<br />
IN a first for Mongolia, the supply and demand<br />
of technical and vocational skills and<br />
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Mongolia<br />
Hunnu Coal has a range of coal prospects throughout Mongolia.<br />
labour across the Gobi region has been extensively<br />
documented, and government, industry,<br />
schools and other stakeholders can<br />
use the information to help transition people<br />
into the workplace with work-ready skills.<br />
Funded by Oyu Tolgoi LLC and Millennium<br />
Challenge Account (MCA)-Mongolia and<br />
carried out by consultancy firm Sustainability,<br />
the Gobi Regional Technical and Vocational<br />
Skills, Labour and Training Survey, or<br />
Technical Vocational Education and Training<br />
(TVET) Project, has produced a baseline assessment<br />
of the reality of technical and vocational<br />
skills, and labour.<br />
Sustainability’s John Miragliotta says it’s the<br />
first time a survey investigating and quantifying<br />
key skill availability has been undertaken<br />
in Mongolia. “We have captured the work experiences<br />
and skills of 18,500 individuals but<br />
information now needs to be verified with aptitude<br />
testing to ensure what skills individuals<br />
‘say’ they have, is what they do have.”<br />
<strong>The</strong> Gobi region holds vast mineral resources<br />
and exploitation of these will result in significant<br />
direct and indirect social and economic impacts<br />
for all of Mongolia, and create an unprecedented<br />
demand for qualified labour.<br />
MCA-Mongolia is an independent Mongolian<br />
entity that has entered into a compact<br />
with US foreign aid agency Millennium Challenge<br />
Corporation to improve Mongolia’s<br />
TVET, with the goal of reducing poverty<br />
through economic growth. <strong>The</strong> TVET Project<br />
is a jointly-funded scheme between MCA-<br />
Mongolia and Oyu Tolgoi LLC to initiate a<br />
public-private partnership to produce essential<br />
baseline information and analysis for TVET<br />
development in the Gobi. Sustainability has<br />
been working with Oyu Tolgoi since 1992 and<br />
the project is a result of a recommendation<br />
made by Sustainability in a previous review.<br />
As well as identifying existing/available skills<br />
and existing and potential demand for skilled<br />
labour, Sustainability assessed the impacts of<br />
various issues to the current and future supply<br />
of and demand for labour and skills development<br />
in the region. Institutional assessment<br />
and analysis was carried out on four existing<br />
regional TVET centres as well as existing vocational<br />
and technical training institutions in<br />
Ulaanbaatar, Erdenet and Darkhan.<br />
Of 18,500 surveyed, 18% have studied a<br />
qualification aimed at a specific vocation;<br />
22% have a qualification at a graduation<br />
level, but only 1% of these is technical and<br />
would be considered for employment entry<br />
purposes in a mining or construction sector;<br />
and 60% are a combination of no schooling<br />
or to Year 10. <strong>The</strong>se figures should not be<br />
seen as a direct correlation with skills as individuals<br />
may have acquired certain skills by<br />
working in jobs that have provided training<br />
or experience in various skills.<br />
Agriculture/hunting was identified as the industry<br />
with most experience with 47% claiming<br />
experience. Education was second at<br />
12%, followed by mining and government,<br />
both 9%, building and construction 7%, services<br />
industry 6%, and health and social services<br />
and transport/communications both 5%.<br />
<strong>The</strong> top indicative skill sets include driving/<br />
equipment operating, computing, construction,<br />
safety and risk, pastoral, crop/plant<br />
breeding, and communal/household but the<br />
bottom indicative sets represent the skills<br />
most in demand by six mining companies<br />
surveyed, including mechanical/maintenance,<br />
management, electrical, fabrication, machining,<br />
mining underground and mining surface.<br />
<strong>The</strong> companies have an immediate need for<br />
another 1000 people across a range of skills<br />
and they consistently described a range of issues.<br />
It is viewed that TVET schools don’t<br />
have the equipment relevant to the workplace<br />
and don’t produce work-ready graduates.<br />
Similarly, in assessing institutions and their<br />
capacity to supply qualified skills by occupations,<br />
Sustainability identified discrepancies<br />
between the level of knowledge and skills of<br />
existing labour in the region, graduates from<br />
vocational education and training institutes,<br />
and requirements of employers.<br />
In terms of safety training, it was noted that<br />
legal requirements are strengthening, as is attention<br />
to OHS in schools but there is a gap<br />
between theory and practice. <strong>The</strong> lack of national<br />
framework was also identified. Until<br />
2010 there was no central qualifications authority<br />
and, as yet, no standard in practice<br />
across all schools.<br />
A key issue in the competency assessment<br />
is that many have training and skills in low demand,<br />
and that there are insufficient linkages<br />
between what training schools are providing<br />
and what employers want. Sustainability recommends<br />
each industry sector have a specific<br />
Industry Education and Training Board responsible<br />
for developing the minimum competency<br />
requirements relevant to that sector.<br />
In addition, industry training should be provided<br />
based on evaluation of a person against<br />
the defined requirements of a job and not haphazardly<br />
provided. All training must be competency<br />
based. Companies should develop<br />
their own training centres for practical competencies<br />
that would be integrated with delivery<br />
of theory-based learning at TVET institutions.<br />
Sustainability recommends that traineeships<br />
and apprenticeships be developed and<br />
funded, and jobs need to be more clearly defined.<br />
It also recommends regional assessment<br />
and training centres be introduced for<br />
career guidance, validation of skills and qualifications<br />
and training provision.<br />
Implementation of recommendations is<br />
under way. <strong>The</strong> Mongolian Government has<br />
established the National Council of Vocational<br />
Education and Training, whose responsibilities<br />
include developing a national TVET framework.<br />
Additionally, partnerships between industry<br />
and schools are strengthening.<br />
30 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Mongolia<br />
PAID ADVERTISEMENT<br />
ACHIEVE BUSINESS OBJECTIVES THROUGH EXPERT KNOWLEDGE<br />
A CASE STUDY FEATURING SHARYN GOL JSC<br />
INTERNATIONAL and local reporting standards specific to the reporting of mineral<br />
reserves and resources, and exploration results are critical to Mongolian mineral<br />
resources companies seeking international investors.<br />
To ensure standards compliance, they require an in-depth understanding and<br />
knowledge of the industry bodies that implement and manage them. Consequently,<br />
increasing numbers of resources companies are outsourcing the expertise<br />
needed to adhere to these regulations and satisfy financial institutions.<br />
Global software solutions and services provider MICROMINE has helped exploration<br />
and mining companies throughout Central Asia achieve their business objectives<br />
and meet reporting requirements. <strong>The</strong> company’s consulting division,<br />
Micromine Consulting Services (MCS), is regarded as one of the leading consulting<br />
authorities within the Asia Pacific area.<br />
MCS manager Dean O’Keefe explains, “MCS provides consulting services to<br />
companies that require specific geological and mining expertise. We have undertaken<br />
numerous independent mineral resource and reserve estimates, site validation,<br />
quality control and pit optimization exercises for companies at pre-feasibility<br />
and feasibility stages for all commodities.”<br />
Local presence and knowledge<br />
Dean O’Keefe adds, “Because MICROMINE has offices in 18 of the world’s mining<br />
capitals, including China, Kazakhstan, Mongolia, Russia and Indonesia, MI-<br />
CROMINE’s clients are provided local services in their own language and time-zone.<br />
Our staff understand the local issues and standards that impact clients’ projects.”<br />
<strong>The</strong> MCS team generate competent persons reports that comply with international<br />
reporting standards including; JORC, N143-101, SAMREC, SEHK (Chapter<br />
18, Hong Kong), China MLR and Mongolian Standard.<br />
MCS is also in the unique position of having recognized in-house experts in the<br />
area of coal mining and geology. Consultants can sign off all Competent Persons<br />
Reports for coal related projects undertaken in Mongolia by MCS. This acknowledgement<br />
adds significant credibility to all elements of a project, particularly where<br />
funding or financial support is required.<br />
Sharyn Gol JSC<br />
Headquartered in Ulaanbaatar, Mongolia, Sharyn Gol JSC is involved in the extraction,<br />
processing and sale of coal in northern Mongolia, with a 100% interest in the Sharyn<br />
Gol coal mine. Its coal is generally sold to utility markets for thermal and semi-coking<br />
purposes and is used by Erdenet and Darkhan as a main energy source.<br />
MCS was recently commissioned to complete a technical report compliant with<br />
JORC standard reporting guidelines for the Sharyn Gol coal mine, about 215km<br />
north of Ulaanbaatar. To ensure optimum results, all work related to the project<br />
was conducted in a meticulous manner and field work, including supervision of<br />
downhole geophysics and drilling, was carried out by Triton Coal according to procedures<br />
established by MCS. If core coal sample recovery was less than 90%,<br />
the seam was re-drilled. Triton Coal diligently followed the prescribed procedures,<br />
resulting in the project’s successful outcomes.<br />
MCS established the work program procedures before drilling commenced, the<br />
borehole patterns were designed and then all coal was logged and sleeved. <strong>The</strong><br />
sample moisture was maintained by sleeving the coal in plastic and keeping samples<br />
at a low temperature. By doing this, oxidation was avoided, the moisture content<br />
was not affected and the calorific value was representative. <strong>The</strong> samples were<br />
dispatched quickly to the laboratory following sampling.<br />
<strong>The</strong> resource estimate modelling was conducted using Coal Measure, MI-<br />
CROMINE’s coal specific software solution. Gridding of the thicknesses and surfaces<br />
of each seam was initially completed by undergoing a geostatistical analysis<br />
to generate a series of semivariograms which were used as the input weightings<br />
for the Kriging algorithm. <strong>The</strong>se grids were then converted into a block model.<br />
Resources were reported separately for above and below 300 metres from surface.<br />
<strong>The</strong> industry standard design depth for Mongolian open cut coal mines is<br />
300 metres, below which all mining is conducted using underground mining methods.<br />
Resources were also divided into two areas - the South West deposit and<br />
Satellite deposit. <strong>The</strong>se areas were reported separately as they possess different<br />
genesis, coming from different basins, and have different coal quality properties.<br />
MCS reported resources on the basis of ‘as received’ and ‘air dry’.<br />
<strong>The</strong> JORC-compliant estimate provided by MCS found the Sharyn Gol Coal<br />
project quadrupled the resource inventory. <strong>The</strong> report’s findings have resulted in<br />
further developments of the mine which are set to enhance the company’s competitiveness<br />
in the domestic and international coal markets. <strong>The</strong> findings also have<br />
the potential to substantially increase profits and shareholder return.<br />
Checking core samples from the Sharyn Gol Coal Project.<br />
Mongolian Government certification<br />
In May 2010, MICROMINE received certification from the Mongolian Government<br />
as a company authorized to conduct feasibility standard studies in Mongolia. Certification<br />
allows MICROMINE to complete any geology, resources, mining and<br />
other related sections of studies submitted to the Government to allow the permitting<br />
and commissioning of mineral projects in Mongolia.<br />
Dean O’Keefe commented, “What makes this certification unique is the knowledge<br />
that we are the only foreign company registered to undertake this type of work in<br />
Mongolia. Having the certification from the Mongolia Government demonstrates their<br />
confidence in the market leading capabilities of MCS’s mining skills and solutions.”<br />
For further information about MCS please contact mcs@micromine.com. For information about<br />
Sharyn Gol JSC visit www.sharyngol.com<br />
32 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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South Korea<br />
PAID ADVERTISEMENT<br />
ACHIEVE BUSINESS OBJECTIVES THROUGH EXPERT KNOWLEDGE<br />
<strong>The</strong> disused infrastructure at Woulfe Mining’s Sangdong tungsten-molybdenum mine.<br />
THE rich mining history of South Korea is on<br />
the verge of being revived with the re-opening<br />
of Woulfe Mining’s Sangdong tungstenmolybdenum<br />
mine in 2012. South Korea once<br />
had a thriving mining culture with many relatively<br />
small metallic mines including gold, base<br />
metals and tungsten-molybdenum.<br />
<strong>The</strong> Sangdong mine was the powerhouse of<br />
the economy in the post-Korean War decades,<br />
contributing more than 50% of the country’s<br />
export revenue as one of the largest global<br />
tungsten producers. This mine along with almost<br />
all other metallic mines in South Korea<br />
closed in the 1990s primarily due to low commodity<br />
prices, at a time when Korea was<br />
emerging as a manufacturing powerhouse with<br />
companies such as Hyundai, LG, Samsung<br />
and Posco attaining international prominence.<br />
<strong>The</strong> mining industry was relegated to an insignificant<br />
corner of the economy and now<br />
contributes less than 0.5% of the GNP. In<br />
fact, in recent years there appears to be a<br />
widespread perception in Korea that the former<br />
mines were fully exploited never to be reopened.<br />
<strong>The</strong> former owner of Sangdong,<br />
Korea Tungsten Co, emerged into Korea’s<br />
largest manufacturer of tungsten cutting tools<br />
and hard metal tools with the only integrated<br />
tungsten production plant in the world.<br />
Known as TaeguTec Ltd, it is 80% owned by<br />
Warren Buffet’s Berkshire Hathaway.<br />
<strong>The</strong> boom in commodity prices is underpinning<br />
the revival of the Korean mining industry.<br />
Woulfe was fortunate in that it recognized<br />
the prospectivity of Korea prior to the<br />
boom and secured title to several properties<br />
in 2006, including Sangdong, the Muguk<br />
gold mine and the Yeonwha lead-zinc mine,<br />
all historically the largest producers of the respective<br />
metals in Korea, plus a number of<br />
other secondary properties.<br />
Woulfe is a junior resource company listed<br />
on the TSX Venture Exchange in Canada. It<br />
is now run by Australian-based Brian Wesson,<br />
an ex-South African with extensive<br />
hands-on mining and project development<br />
experience. Prior to taking control of Woulfe,<br />
Brian Wesson and his wife Amelia, also a director<br />
of the company, were instrumental in<br />
re-commissioning the Vatakoula gold mine in<br />
Fiji. Bouyed by their achievements in Fiji, the<br />
Wessons carried out due diligence on the Korean<br />
assets in late 2009 and considered that<br />
a world-class tungsten project in South Korea<br />
was a project developer’s dream.<br />
Under their management, the company<br />
was recapitalized and rebadged as Woulfe<br />
Mining. Given Brian Wesson’s background,<br />
the focus switched from exploration to development.<br />
<strong>The</strong> previous concept of a large<br />
open pit mine at Sangdong was replaced by<br />
the much simpler concept of re-opening the<br />
old workings, which significantly reduced the<br />
environmental and permitting requirements.<br />
A scoping study undertaken by Wardrop in<br />
the UK was finalized in March 2010 based on<br />
an underground room-and-pillar mining operation.<br />
This study was based on an annual<br />
production rate of 2.5 million tonnes with an<br />
initial capital cost of US$289 million, and generated<br />
a pre-tax net present value of US$462<br />
million at an 8% discount rate, with an internal<br />
rate of return of 26%.<br />
Significant progress has been achieved<br />
since the release of the scoping study. Mining<br />
approval was granted in June 2010 by the<br />
provincial government, portions of the upper<br />
levels have been rehabilitated for drilling access<br />
and the feasibility study is well advanced.<br />
In line with Brian Wesson’s hands-on<br />
approach, he is using seasoned industry consultants<br />
to undertake the detailed evaluation<br />
and design work in conjunction with Wardrop<br />
to ensure that the feasibility study is completed<br />
later this year.<br />
<strong>The</strong> study is based on an initial annual production<br />
rate of 1.2 million tonnes producing a<br />
relatively low grade tungsten flotation concentrate<br />
which will be upgraded to APT (ammonium<br />
paratungstate). <strong>The</strong> tungsten price most<br />
generally quoted is for APT, expressed as the<br />
price per metric tonne unit (mtu) of tungsten<br />
oxide (WO3) in APT. A mtu is equal to 10kg of<br />
WO3. <strong>The</strong> APT price is currently over<br />
US$400/mtu, almost 10 times the price when<br />
the Sangdong mine closed in 1992 and more<br />
than twice the price in late 2009. A tungsten<br />
price of US$250 was used in the scoping study.<br />
Tungsten is a strategic metal and China<br />
dominates global production and consumption.<br />
China has recently extended its restrictions<br />
on the production and export of<br />
tungsten, along with the restrictions on rare<br />
earths and antimony, to conserve its resources<br />
and protect the environment. China<br />
had long been the largest exporter of tungsten,<br />
however its own growth has turned it<br />
into the leading consumer of the metal. This,<br />
combined with the continued demand across<br />
the rest of the world, precipitated the sudden<br />
surge in the price of tungsten.<br />
<strong>The</strong> Sangdong mine is well placed to meet<br />
the looming supply shortage. By world standards,<br />
it is a very large uniform skarn deposit<br />
with significant residual resources. <strong>The</strong> NI 43-<br />
101 compliant resource estimate determined<br />
by Wardrop in the scoping study totalled 103.2<br />
million tonnes at an average grade of 0.35%<br />
WO3 with molybdenum credits, calculated<br />
34 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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PAID ADVERTISEMENT<br />
South Korea<br />
using a cut-off grade of 0.10% WO3. <strong>The</strong> resource<br />
was contained within two parallel skarn<br />
lodes referred to as the Hangingwall and Footall<br />
lodes. A central Main lode was the focus of historic<br />
mining and the<br />
remnant resources<br />
within this zone were<br />
not included in the<br />
scoping study resource<br />
estimate.<br />
<strong>The</strong> three parallel<br />
zones dip to the north<br />
at between 15 to 30<br />
degrees, with a lateral<br />
extent of up to 1300<br />
metres along strike<br />
and 1500 metres<br />
down dip. <strong>The</strong> Main<br />
zone is 5 to 6 metres<br />
in thickness and has<br />
the highest average<br />
grade with tungsten<br />
grades of several percent in the core. Much of<br />
the Main zone has been exploited. <strong>The</strong> Hangingwall<br />
lode, some 15 to 20 metres above the<br />
Main zone, varies in thickness due to the irregular<br />
boundary with the overlying limestone, with<br />
an average thickness of 10 to 12 metres. <strong>The</strong><br />
Footwall lode, some 35 to 40 metres below the<br />
Main zone, comprises several skarn zones with<br />
an overall thickness of up to 12 metres.<br />
<strong>The</strong> upper levels of the old workings are<br />
above the valley floor and above the current<br />
water level in the mine. A 5300 metre drilling<br />
program is under way to upgrade the resource<br />
estimates within the Hangingwall and Footwall<br />
lodes above the water level, and to determine<br />
the remaining resource within the Main zone in<br />
this area. Significantly, an infrastructure pillar<br />
protecting the haulage level traverses the<br />
mine, with infrastructure pillars housing inclined<br />
haulage and ventilation shafts located on the<br />
east and west flanks of the mine.<br />
<strong>The</strong> resources above the water line between<br />
the -1 Level and +1 Level, representing<br />
a vertical distance of around 60 metres, will<br />
underpin the feasibility study, referred to as<br />
the fast-track plan as it alleviates the requirement<br />
to dewater the mine prior to start-up.<br />
<strong>The</strong> bulk of the resources below the water line<br />
to -18 Level will be progressively drilled and<br />
evaluated as the mine is dewatered. Preliminary<br />
estimates of the resources above the<br />
water line indicate that this area should support<br />
a mine life of at least 5 years with above<br />
average grades over 0.4% WO3 expected.<br />
<strong>The</strong> drilling is being expedited with 3 underground<br />
rigs and 4 surface rigs operating, and<br />
a revised resource estimate is scheduled to<br />
be completed by June 30 this year.<br />
China dominates world tungsten production and tungsten reserves.<br />
According to Woulfe’s president and CEO<br />
Brian Wesson, management is focused on<br />
shareholder value. “Our aim is to build an efficient<br />
project, not necessarily the largest but<br />
the most cost effective, in order to provide reliable<br />
returns. Early mining will focus on the<br />
upper part of the mine, above the valley floor,<br />
which was not mined as previous owners<br />
were using the infrastructure in the top of the<br />
mine. As the ore zones are 1000 metres wide<br />
and 7 to 12 metres high, they can be bulk<br />
<strong>The</strong> western world’s active tungsten mines and known tungsten projects.<br />
mined using large trackless gear, making extraction<br />
costs very efficient. As the mine can<br />
support the construction of an APT plant,<br />
Woulfe will be strategically placed within Asia<br />
to produce a commodity that can be sold directly<br />
to consumers on metal bulletin pricing.”<br />
Woulfe’s vice president - technical Bill Kable<br />
says the planned annual production rate will<br />
initially be 1.2 million tonnes with the option<br />
of increasing to 2.4 million tonnes later, depending<br />
mostly on market conditions.<br />
“<strong>The</strong> in-house capex estimate is US$130<br />
million for onsite crushing, grinding and flotation<br />
circuits plus mine development and infrastructure,<br />
and an APT plant. Woulfe has<br />
purchased the primary crushing circuit which<br />
was new but unwanted equipment, and is<br />
looking to source the rod mills on a similar<br />
basis. Work is well advanced on the detailed<br />
engineering design of the plant which will be<br />
situated on the footprint of the old Sangdong<br />
plant site, thereby simplifying the environmental<br />
requirements.<br />
“<strong>The</strong> APT plant, which will be one of very few<br />
in the western world, will most likely be located<br />
offsite near port facilities so it can be used for<br />
toll treating third party concentrates and also<br />
better placed to attract technical staff.”<br />
Woulfe has a strategic Korean shareholder<br />
with Korea Zinc recently investing Can$10<br />
million and adequate cash of more than<br />
Can$16 million including warrants to be exercised<br />
this year to complete the feasibility<br />
study, plus some very interesting projects yet<br />
to be evaluated. For example, a large molybdenum<br />
stockwork zone lies below the Sangdong<br />
skarn and preliminary work suggests<br />
that this could be exploited by bulk mining<br />
methods. Muguk is also a very exciting project<br />
with a residual resource of more than<br />
500,000 ounces of gold at closure in 1997.<br />
May/June 2011 | <strong>ASIA</strong> <strong>Miner</strong> | 35
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South Korea<br />
PROMISING STONEHENGE URANIUM RESULTS<br />
DESPITE the uncertainty created in the uranium<br />
industry by the Japanese power plant<br />
crisis, South Korea’s government is committed<br />
to existing plans for nuclear power and is<br />
encouraged by the recent results of Stonehenge<br />
Metals at its uranium prospects.<br />
Stonehenge's mineral resource estimate for<br />
its Daejon Uranium Project has increased by<br />
87%, thus becoming the largest uranium resource<br />
in South Korea. <strong>The</strong> estimate has been<br />
Stonehenge Metals has a number of uranium prospects along South Korea’s uranium belt.<br />
calculated at 92 million tonnes averaging 320<br />
ppm uranium for a contained 65 million pounds.<br />
<strong>The</strong> company has also made a new uranium<br />
discovery at its Gwesan project. Strong<br />
intercepts have been returned from the first<br />
six holes of a drill program designed to test<br />
the down dip and along strike continuity of<br />
outcropping uranium and vanadium.<br />
<strong>The</strong> best intercept is 7 metres at 337 parts<br />
per million (ppm) uranium and 4880ppm<br />
vanadium. Other assay results include 8 metres<br />
@ 10,198ppm vanadium from 87 metres,<br />
and 17 metres @ 267ppm uranium and<br />
5460ppm vanadium from 140 metres.<br />
<strong>The</strong> uranium mineralization extends over<br />
about 600 metres of strike length and is<br />
open along strike and down dip. This discovery<br />
has been made in an area where there<br />
has been no previous drilling. Stonehenge’s<br />
managing director Richard Henning says,<br />
“Given the early stage of this exploration the<br />
results are very encouraging and warrant further<br />
drilling. Following receipt of all assay results<br />
a new drilling program will be<br />
considered to extend the target and further<br />
add to the exploration potential of Gwesan.<br />
ASX-listed Stonehenge owns 100% of a<br />
Korean company called Chong Ma Mines<br />
which holds the rights to four uranium projects<br />
in South Korea, including Gwesan and<br />
Daejon. It hopes to play a role in satisfying the<br />
country’s growing need for nuclear power.<br />
Nuclear accounts for 31.4% of South<br />
Korea's electricity generation needs and the<br />
government wants this to increase to 48.5%<br />
by 2024. <strong>The</strong> country has seven reactors under<br />
construction, with plans to build six more,<br />
bringing to 34 the number on stream by 2024.<br />
At Daejon the JORC-compliant inferred resource<br />
was prepared by Snowden and is derived<br />
from three prospects – Chubu,<br />
Yokwang and Kolnami. <strong>The</strong> inferred classification<br />
reflects the lack of industry standard<br />
QAQC data, reliance on historic data and the<br />
current drill spacing. Snowden states it is<br />
confident that an infill drill program with industry<br />
standard sapling, assaying and QAQC<br />
procedures and protocols, together with metallurgical<br />
test work, will result in an upgrading<br />
of the classification.<br />
<strong>The</strong> increased resource is based on a combination<br />
of new information including new detailed<br />
geological mapping over much of the<br />
deposit by the Korean Resource Corporation<br />
(KORES) in 2009. KORES also completed<br />
ground radiometric traverses at 50 metre spacings<br />
along strike over much of the deposit.<br />
Stonehenge has signed an agreement with<br />
Kongju University in Korea to review drill core<br />
from previous historical drilling by KORES.<br />
<strong>The</strong> core is in excellent condition and the relogging<br />
of this has greatly added to the overall<br />
understanding of the structure, lithologies and<br />
stratigraphy of Daejon mineralization.<br />
Stonehenge is continuing metallurgical test<br />
work, preparing for the pre-feasibility stage.<br />
Korean funds for Canadian moly<br />
SOUTH Korea’s largest specialty steel maker<br />
SeAH Holdings Corp has forged a strategic<br />
alliance with Canada’s Avanti Mining with the<br />
aim of jointly developing the Kitsault Molybdenum<br />
Project in British Columbia. SeAH<br />
hopes to source molybdenum for its Korean<br />
steel operations while Avanti will use funds<br />
from SeAH to get the past producing mine<br />
back in operation.<br />
<strong>The</strong> alliance began with a private placement<br />
by SeAH of Can$11 million into Avanti<br />
in late December 2010, which gave the Korean<br />
company a 10.7% stake in Avanti. <strong>The</strong><br />
funds are to be used to fund detailed design<br />
engineering, environmental assessment and<br />
permitting for Kitsault.<br />
It was further advanced in late January<br />
when both companies entered into a letter of<br />
intent with respect to a potential acquisition<br />
by SeAH of up to a 30% interest in the project.<br />
<strong>The</strong> amount of investment needed to<br />
earn the interest is being negotiated between<br />
the parties based upon the valuation reflected<br />
in Kitsault feasibility study announced on December<br />
16, 2010. <strong>The</strong> transaction is subject<br />
to any required regulatory approval, third<br />
party consents, customary due diligence and<br />
a definitive participation agreement.<br />
SeAH is a public company listed on the Korean<br />
stock exchange. It is the holding company<br />
of SeAH Group, established in 2001 by<br />
separating the SeAH Steel's investment sector<br />
and is based in Seoul. SeAH has 18 domestic<br />
and 13 overseas subsidiaries/operations with<br />
business areas in special steel producing, pipe<br />
manufacturing, IT and energy.<br />
SeAH Besteel Corp, the largest subsidiary<br />
of SeAH, is known as the number one special<br />
steel maker in Korea and the company<br />
mainly produces automotive parts and shipbuilding<br />
parts for globally renowned automakers<br />
and shipbuilders.<br />
36 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Indonesia<br />
INTERMET TURNS DOWN BAUXITE PROJECT OPTIONS<br />
HILLGROVE Resources’ 84.5%-owned subsidiary<br />
InterMet Resources has decided not<br />
to accept the offer of assignment from Hillgrove<br />
for two bauxite project options, Landak<br />
and Tayan South, in West Kalimantan.<br />
InterMet was last year granted the offer but<br />
following extensive due diligence of the terms<br />
of the options and the underlying tenements<br />
has turned them down.<br />
<strong>The</strong> tenements are either side of PT Antam’s<br />
Munggu Pasir and Tayan bauxite deposits.<br />
Munggu Pasir has a washed probable reserve<br />
of 40 million tonnes @ 46.6% alumina and<br />
Tayan has washed possible and probable reserves<br />
of 30.9 million tonnes @ 47.5% alumina.<br />
<strong>The</strong> InterMet due diligence process followed<br />
preliminary exploration by Hillgrove. Results of<br />
sampling undertaken within the Landak licence<br />
area indicated the presence of widespread<br />
gibbsitic bauxite in the southern portion<br />
of the licence. Bauxite averages 3 metre in<br />
thickness and is generally best developed as<br />
a draped formation over gently undulating topography<br />
within an 18sqkm area.<br />
Hillgrove then shifted exploration to the<br />
Tayan South licence area. Initial test pitting in<br />
the southern area of Ngbung encountered<br />
widespread bauxite averaging about 4 metres<br />
in thickness, with maximum grades over 54%<br />
alumina. InterMet is a uranium, copper, gold,<br />
nickel and base metals exploration and development<br />
company, with assets in the worldclass<br />
mineral deposits area of the Gawler<br />
Craton in South Australia and an impressive<br />
exploration portfolio in northern Queensland.<br />
Since September 2008, when Hillgrove acquired<br />
a majority interest, considerable time<br />
has been spent reviewing the extensive Inter-<br />
Met portfolio with a view to reducing it to a<br />
manageable size and defining any key projects<br />
on which to focus exploration efforts.<br />
This work saw a large reduction in tenement<br />
holdings and two key focus areas identified<br />
in the Mt Garnet area in Queensland and<br />
Lake Gilles area in South Australia.<br />
With the review completed the focus shifted<br />
to field exploration once more with on-ground<br />
exploration at Munderra in Queensland in late<br />
2009. In June 2010 InterMet announced that<br />
it planned to refocus its activities around bulk<br />
commodities – bauxite, coal and iron ore in<br />
Australia and Indonesia.<br />
Hillgrove then offered InterMet options to<br />
acquire a 70% share in five companies that<br />
own nine exploration licenses over the Landak<br />
and Tayan South bauxite projects covering<br />
a total of 1400sqkm. <strong>The</strong> region is a<br />
recognized bauxite province.<br />
<strong>The</strong> bauxite tenements InterMet and Hillgrove have been examining are in West Kalimantan.<br />
Robust attracts Romang partner<br />
AFTER a 12 month search Robust Resources<br />
has secured a strategic Indonesian partner<br />
for its Romang Island project. PT Kilau Sumber<br />
Perkasa (PT KSP), an affiliate of the Salim<br />
Group, will acquire a 22.5% interest in Robust’s<br />
Indonesian subsidiary PT Gemala Borneo<br />
Utama (PT GBU) for Aus$30.7 million.<br />
PT GBU is the local Indonesian entity that<br />
owns the mining rights to the Romang Island<br />
project and the new partnership with PT KSP<br />
will fully satisfy the future statutory requirement<br />
for local participation in project development.<br />
In April 2010 Robust decided to acquire the<br />
remaining 25% of PT GBU that it did not own<br />
from the original vendors. Since then, and following<br />
the progress the company has made<br />
in advancing the project, directors have been<br />
seeking a well-credentialed, strategic Indonesian<br />
partner that has in-country experience,<br />
government relationships and a track record<br />
of developing greenfield projects into successful<br />
operating companies.<br />
<strong>The</strong> Salim Group is a highly regarded Indonesian<br />
group with diversified business interests<br />
including commodities, infrastructure<br />
and logistics. As part of the transaction, a<br />
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representative of the Salim Group will join the board of PT GBU.<br />
Robust’s managing director Gary Lewis says, “As well as attracting<br />
a strong partner, this transaction means that the consolidated group<br />
will, on final settlement, have in excess<br />
of $60 million in cash, which<br />
gives us the necessary funding to<br />
take the project through to the feasibility<br />
and development phases.”<br />
As Robust embarks on a 27,000<br />
metre, $10 million exploration program<br />
for 2011 it has purchased a<br />
seventh diamond core drill rig. <strong>The</strong><br />
rig will be used at North Romang<br />
where the company is targeting a<br />
gold-rich copper porphyry system.<br />
It is undertaking an IP-resistivity<br />
survey to identify suitable drill targets.<br />
Early feedback has been positive<br />
with a number of anomalies<br />
identified. <strong>The</strong> rig and six months of<br />
supplies has arrived on site and upon receipt of the first phase of data,<br />
drilling will begin immediately.<br />
Robust has also strengthened its senior management team so it<br />
has the right skills in place to support the next growth phase of its<br />
projects. Gordon Lewis has been appointed chief operating officer<br />
based in Jakarta while Warwick Browne has joined the company as<br />
health, safety, environment and community (HSEC) manager.<br />
Gordon Lewis is a qualified engineer and mine manager who has more<br />
Sumatra Copper & Gold’s Tembang project is in central Sumatra.<br />
than 30 years experience in mining and exploration. He has spent more<br />
than 10 years working in Indonesia across a number of gold production<br />
and exploration projects. Warwick Browne has more than 10 years’ experience<br />
working in Asia assisting<br />
in the development of HSEC plans.<br />
Tembang production timetable set<br />
FOLLOWING a successful resource<br />
augmentation drill program,<br />
Sumatra Copper & Gold is now focused<br />
on bringing the Tembang<br />
Gold and Silver Project in central<br />
Sumatra into production by early<br />
2013. An annual production rate of<br />
70,000-80,000 ounces gold equivalent<br />
over more than 10 years is<br />
targeted with cash costs of around<br />
US$500 per ounce.<br />
Since early 2010 the company<br />
has conducted an aggressive drilling<br />
program at Tembang to test potential depth extensions of the known<br />
resource - particularly at deeper limits of the known data where good<br />
grades were evident. Drilling programs at the Belinau and Berenai deposits<br />
targeting and encountering higher grade zones have resulted in<br />
an overall more robust and higher grade resource of 23.54 million tonnes<br />
@ 1.32 grams/tonne gold and 17.3 grams/tonne silver. This represents<br />
a 39% increase in grade from the 2009 resource estimate by Snowden.<br />
<strong>The</strong> Belinau deposit itself represents a potential underground resource<br />
of 490,000 tonnes @ 8.24 grams/tonne gold and 71.8 grams/<br />
tonne silver. Drilling in 2010/11 has added 99,700 ounces of gold and<br />
746,400 ounces of silver at an average grade of 9.17 grams/tonne<br />
gold and 68.7 grams/tonne silver.<br />
<strong>The</strong> vein component is now 79% of the total resource mainly due to<br />
the decrease in the halo resource. This better reflects the most important<br />
style of mineralization in the deposit. <strong>The</strong> measured and indicated<br />
categories have also increased from 47% of the total resource to 76%.<br />
<strong>The</strong> inferred halo mineralization has been materially reduced to 12.18<br />
million tonnes @ 0.54 grams/tonne gold and 7 grams/tonne silver due<br />
to a more rigorous review of the geological model.<br />
<strong>The</strong> company plans to complete pre-feasibility studies by mid-2011<br />
so that a definitive feasibility study (DFS) can then be commissioned.<br />
<strong>The</strong> considerable amount of previous pre-feasibility work already undertaken<br />
by the company in 2008 and 2009 prior to its IPO, particularly<br />
drilling, base line studies and metallurgical test work, will facilitate<br />
this process. A definitive mining strategy is now being developed,<br />
which may include a plan for mining the high grade Belinau lode partly<br />
or wholly by underground means. Final mine planning will be undertaken<br />
once the infill drilling and definitive resource modelling is completed<br />
in mid-2011.<br />
<strong>The</strong> current schedule is for the DFS to be completed by the end of<br />
2011 and construction to begin, subject to permitting and financing,<br />
in the second quarter of 2012.<br />
Sumatra’s managing director Jocelyn Waller says the updated resource<br />
estimates underpin the company’s decision to advance the<br />
project into production. “We now have an overall higher grade resource<br />
dominated by vein style mineralization, and certainly a robust<br />
foundation on which to base the mine development. It’s now<br />
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all systems go to take this through feasibility<br />
into production.”<br />
Joint venture arrangements have been finalized<br />
between Sumatra and Newcrest Mining in<br />
respect of PT Bengkulu Utara Gold and its<br />
100,000 hectare exploration IUP for the Tandai<br />
project in Bengkulu province, Sumatra. <strong>The</strong><br />
company has completed drilling and helicopter<br />
agreements in preparation for a drilling program<br />
which was scheduled to start by the end of<br />
April. <strong>The</strong> first phase program of 4000 metres<br />
is planned to test the Tandai Lode, Glumbuk<br />
and Toko Rotan.<br />
First drilling at Banda Raya<br />
CENTURION <strong>Miner</strong>als will undertake a firstphase<br />
drilling program on the Geudob<br />
prospect at its Banda Raya Gold Project in<br />
northern Sumatra. <strong>The</strong> drilling follows successful<br />
initial surface geological and geochemical<br />
surveys.<br />
<strong>The</strong> Banda Raya property is adjacent to East<br />
Asia <strong>Miner</strong>als’ Miwah gold project which hosts<br />
a potential multi-million ounce gold discovery.<br />
<strong>The</strong> geological and geochemical surveys<br />
have delineated a 5km-radius gold-copper<br />
prospect complex, which hosts high-sulphidation<br />
epithermal gold, porphyry gold-copper, and<br />
quartz vein-types of mineralization.<br />
Analysis of rock-chip samples from the Geudob<br />
prospect returned as high as 0.96 grams/<br />
tonne gold with several oxidized, malachitebearing<br />
samples grading up to 0.1% copper.<br />
In addition, a suite of metalliferous samples<br />
distributed over a 1km strike length contained<br />
up to 0.46 grams/tonne gold and 0.1% copper,<br />
and samples from a previously delineated<br />
Construction of the exploration camp at the Leuping prospect of Centurion’s Banda Raya Gold project.<br />
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prominent hill interpreted to be underlain by intrusions<br />
assayed up to 1.3 grams/tonne gold<br />
and 0.27% copper.<br />
Assays of grab samples and boulders believed<br />
to originate from the nearby mineralized<br />
outcrops reported gold values up to 4.46<br />
grams/tonne as well as copper values up to<br />
1.38%. Centurion has also re-established the<br />
location of a major vein system at the Keladi<br />
prospect, on which a previous explorer reported<br />
a vein having a strike length of at least<br />
250 metres and section assays up to 15.35<br />
grams/tonne gold, 986 grams/tonne silver,<br />
3.35% copper, 14.2% lead and 15.6% zinc.<br />
<strong>The</strong> setting of this vein is within a large circular<br />
structure that Centurion has identified<br />
as a primary exploration target. <strong>The</strong> high gold<br />
and base-metal-bearing vein is considered<br />
similar to quartz-sulphide veins typically developed<br />
around the peripheries of large porphyry<br />
copper-gold-molybdenum systems.<br />
Centurion’s chairman Alfred Lenarciak says,<br />
“Geological results have confirmed the existence<br />
of a cluster of significant gold-copper<br />
prospects outside the Miwah prospect area.<br />
Multiple exploration camps have been established<br />
and all field infrastructure is in place to<br />
commence drilling phase exploration.”<br />
<strong>The</strong> company has recently appointed<br />
Thomas Dott as project manager to oversee<br />
all exploration and drilling work on Banda<br />
Raya. His career, which spans 16 years, has<br />
been primarily spent on porphyry coppergold<br />
and epithermal gold deposits including<br />
those at Frieda, Porgera, and Tolukoma in<br />
Papua New Guinea. Most recently he designed<br />
and managed the drilling program of<br />
porphyry copper-gold prospects for Centurion’s<br />
neighbours, East Asia <strong>Miner</strong>als.<br />
Koiti Mel has also been appointed chief geologist<br />
and is responsible for leading field exploration<br />
activities. His 17 years of experience<br />
covers early exploration prospects to feasibility<br />
stage activities on epithermal gold and porphyry<br />
copper-gold projects, including Porgera.<br />
Strong Bima trench results<br />
TRENCHING and soil sampling at the Soro<br />
prospect of Arc Exploration’s Bima project in<br />
East Sumbawa has extended disseminated<br />
gold mineralization and identified an extensive<br />
gold/multi-element soil anomaly.<br />
<strong>The</strong> company has received results from another<br />
three trenches testing a strong gold soil<br />
anomaly at the northern end of the Soro<br />
Prospect. One of these trenches intersected<br />
strongly silicified limestone and returned 59<br />
metres @ 0.84 grams/tonne gold and 26 metres<br />
@ 1.31 grams/tonne. This trench is about<br />
80 metres south of another trench where a<br />
recent result of 38 metres @ 2.88 grams/<br />
tonne gold includes a high-grade zone of 2<br />
metres @ 35.4 grams/tonne.<br />
<strong>The</strong> broad zone of disseminated gold mineralization<br />
hosted by silicified limestone<br />
(jasperoid) in the northwest part of the Soro<br />
prospect now extends for at least 180 metres<br />
in a northeast direction. <strong>The</strong> mineralization is<br />
open to the southwest and contained within<br />
an extensive 3km x 2km gold/multi-element<br />
soil anomaly that extends to the south.<br />
Trenching at an Arc Exploration tenement<br />
on Sumbawa.<br />
<strong>The</strong>se two broad intercepts are separated by<br />
a narrow access track that was not trenched.<br />
<strong>The</strong> other two trenches were weakly mineralized<br />
in moderately silicified and fresh limestone.<br />
Arc’s managing director John Carlile says,<br />
“<strong>The</strong>se results are very positive. <strong>The</strong> new<br />
trench gold intercepts are significant because<br />
they expand the area of potentially economic<br />
gold mineralization that we have found so far<br />
in the silicified limestone at the northern end of<br />
the prospect and the mineralization is still open.<br />
“<strong>The</strong> size and intensity of the surrounding<br />
soil anomaly is also significant as it suggests<br />
a very large zone of gold-bearing silicification<br />
with potential to host a bulk tonnage gold resource<br />
and high-grade feeder zones. So far,<br />
only the northern part of the anomaly has<br />
been tested by trenching and therefore the<br />
potential to find more disseminated gold mineralization<br />
is regarded as high.”<br />
<strong>The</strong> Bima exploration tenement covers<br />
250sqkm and has excellent infrastructure<br />
with a network of sealed to graded roads traversing<br />
almost all of the tenement area.<br />
<strong>The</strong> company has three projects - Bima,<br />
Trenggalek in East Java and a strategic alliance<br />
with the Anglo American group in West<br />
Papua, where exploration has recently resumed.<br />
This exploration IUP covers about<br />
1000sqkm and is in the same belt of rocks<br />
that host the giant Grasberg mineral district.<br />
<strong>The</strong> exploration is building on existing information<br />
and includes regional reconnaissance<br />
at a number of locations designed to identify<br />
further targets for more detailed follow-up.<br />
<strong>The</strong> alliance aims to begin drilling in the second<br />
half of the year.<br />
Way Linggo production halted<br />
PRODUCTION of gold and silver at Kingsrose<br />
Mining’s Way Linggo project in southern<br />
Sumatra has been impacted by an enforced<br />
shutdown of the ball mills owing to excessive<br />
wear. <strong>The</strong> problem was expected to reduce<br />
April production by around 50%.<br />
During a scheduled inspection of both ball<br />
mills at the beginning of April it was noted that<br />
excessive wear to the liners warranted their<br />
immediate replacement and the company decided<br />
not to operate the plant and risk damage<br />
to the mills until new liners could be fitted.<br />
Further inspection of the mill bearings during<br />
downtime revealed noticeable deterioration<br />
and issues with the ball mill trunnion bearings<br />
and lube system. Temporary repairs were carried<br />
out enabling the mills to resume operating.<br />
Unfortunately spares located on-site were<br />
deemed insufficient and Kingsrose had to<br />
bring in replacement mill liners and another<br />
bearing. <strong>The</strong>se were expected to be fitted<br />
on or about April 18.<br />
<strong>The</strong> company has since assessed the impact<br />
of the incident and has taken measures to ensure<br />
it has matters covered moving forward.<br />
Kingsrose also has a scheduled shutdown<br />
planned in June to commission and tie-in a<br />
new SAG Mill and management forecasts<br />
that production for the June quarter will now<br />
be around 8000 ounces gold.<br />
<strong>The</strong> company says the problems were disappointing<br />
in light of the solid operational improvements<br />
made over the past six months<br />
and particularly after achieving a commendable<br />
result in the March quarter with gold production<br />
reaching 10,463 ounces and silver<br />
production of 123,774 ounces with preliminary<br />
cash cost estimates after silver credits<br />
being around US$25 per ounce.<br />
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<strong>The</strong> processing plant at Kingsrose Mining’s Way<br />
Linggo project in southern Sumatra.<br />
Way Linggo sits within a sixth generation<br />
Contract of Work covering an area of<br />
10,540 hectares and is held by Kingsrose's<br />
85%-owned Indonesian subsidiary, PT<br />
Natarang Mining. It covers highly prospective<br />
tertiary volcanic stratigraphy that is host<br />
to a number of significant gold and copper‐gold<br />
deposits associated with a major<br />
arc‐parallel fault, known regionally as the<br />
Trans‐Sumatra Fault Zone.<br />
Mine development on the Way Linggo<br />
veins began in early 2009 and plant construction<br />
began in July 2009. <strong>The</strong> process<br />
plant began commissioning in August 2010<br />
and the first official pour of gold and silver<br />
dore occurred on August 13.<br />
Panton Luas drilling under way<br />
PROSPERITY Resources has started its first<br />
drilling program at the Panton Luas<br />
prospect of its Aceh Project in Indonesia.<br />
Previous trenching at Panton Luas recorded<br />
results including 15 metres @ 6.71 grams/<br />
tonne gold, 6 metres @ 2.7 grams/tonne<br />
and 15 metres @ 3.10 grams/tonne.<br />
Panton Luas is one of a number of targets<br />
at the Aceh Project with two rigs undertaking<br />
the drilling. An ongoing drilling program<br />
is anticipated on the basis of successful results<br />
from this initial program.<br />
Preparation of drill sites and access to the<br />
Mutiara and Pelumat prospects continues with<br />
drilling expected to start as soon as possible.<br />
Prosperity controls a 410sqkm contiguous<br />
tenement position along a 60km structural<br />
corridor to the west of the Sumatra Fault<br />
considered highly prospective for gold/copper<br />
mineralization. A helicopter-borne magnetic<br />
survey completed in the latter part of<br />
last year identified several potential porphyry<br />
centres and high grade skarn occurrences.<br />
<strong>The</strong> company has recently received the<br />
results of the second part of the 3D inversion<br />
modelling from the 2010 helimag survey<br />
flown within the project. <strong>The</strong> results<br />
cover the eastern belt of magnetic anomalies<br />
and highlight six additional potential<br />
copper/gold porphyry targets. <strong>The</strong> data<br />
from most of the eastern area was flown at<br />
200 metre line spacing.<br />
Assessment of the new targets - NE Panton<br />
Luas, Samadua East, Serotan, Damar<br />
Buwi, Mersak East and Payabu - has<br />
started with follow up reconnaissance geology<br />
and sampling.<br />
This second part of 3D inversion modelled<br />
data was undertaken to assist in interpretation<br />
of the magnetic survey and to focus<br />
field geological reconnaissance mapping<br />
and sampling activities. <strong>The</strong> integration of<br />
the magnetic and field data has aided both<br />
geological and magnetic interpretation and<br />
refined the understanding of mineralisation<br />
controls and its setting.<br />
<strong>The</strong>re is a commonality in geological style<br />
in the eastern and western belts. <strong>The</strong>re is<br />
evidence of magnetite-rich intrusives with<br />
significant vertical persistence which are<br />
considered likely to be related to significant<br />
altered and mineralised basic to intermediate<br />
composition intrusives.<br />
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PAID ADVERTISEMENT<br />
G-RESOURCES TO ‘ROCK AND RULE’ WITH MARTABE<br />
Earthworks are under way at Martabe.<br />
An aerial view of work at the project.<br />
G-RESOURCES is ready to ‘rock and rule’<br />
at the Martabe Gold-Silver Project in North<br />
Sumatra, according to the company’s vice<br />
chairman Owen Hegarty. Development work<br />
is progressing full steam ahead with first<br />
production by the end of 2011, making<br />
Martabe the first major new mining project<br />
in Indonesia for 10 years.<br />
<strong>The</strong>re are more than 1200 people on site<br />
as the company gears up for mining and<br />
production, while ongoing near-mine exploration<br />
is certain to add to the resource inventory<br />
of 6.5 million ounces of gold and 66<br />
million ounces of silver.<br />
Owen Hegarty says G-Resources has a<br />
simple strategy to grow a decent scale,<br />
Asian-based and focused gold company<br />
with Martabe as the key, central, quality,<br />
starter asset. “Most great resource companies,<br />
such as BHP, Rio Tinto and Newmont,<br />
started with a single quality asset. Our asset<br />
is outstanding with all the features needed<br />
to be successful - scale, good grade, good<br />
metallurgy, simple processing, lots of upside<br />
and long life - all in a very stable and secure<br />
domain. With these features you can grow<br />
a quality, long-term business.<br />
“We have the starter with strong potential<br />
to expand and this gives us a firm footing to<br />
look at a suite of other opportunities throughout<br />
the Asia Pacific region.<br />
“<strong>The</strong> region is under-explored and even unexplored,<br />
it’s mining friendly and there’s great<br />
prospectivity. From our perspective we know<br />
the people, the places, the projects, the<br />
rocks, the rules and regulations – so we are<br />
ready to ‘rock and rule’.<br />
“It’s great timing to do what we are doing<br />
and we have a very clear focus on building<br />
Martabe using the key principles of time,<br />
quality, budget and safety.”<br />
G-Resources is listed in Hong Kong,<br />
which Owen Hegarty says provides great<br />
access to capital in that part of the world.<br />
“As well as good institutional support from<br />
western sources like Blackrock and JP Morgan,<br />
it connects us to local business people,<br />
Chinese institutions and high net worth<br />
individuals. Hong Kong is growing in importance<br />
in mining and exploration. It’s not a<br />
mature market in terms of mining, ratings,<br />
understanding and the like, but provides<br />
better access to capital.”<br />
Gold the ‘perfect metal’<br />
<strong>The</strong> current strength of gold and attractiveness<br />
of Indonesia as a mining destination also<br />
contribute to G-Resources’ upbeat outlook.<br />
“Gold is the perfect metal with many things<br />
going for it,” Owen Hegarty says. “It’s a commodity,<br />
currency, store of value, safe haven,<br />
hedge against inflation, hedge against geopolitical<br />
uncertainty and against financial uncertainty.<br />
It is in strong physical demand,<br />
whether in watches, jewellery or electronics<br />
and has strong metaphysical demand in<br />
terms of the reasons to own it as a currency.<br />
“<strong>The</strong> supply side is under pressure with new<br />
mine supply falling. Because there hasn’t been<br />
much exploration success in the past 10 years<br />
for large deposits, supply will keep falling for<br />
another 10 years. If you examine demand and<br />
supply factors, it is a commodity under tension,<br />
which means it behaves in a volatile way. We<br />
think gold is trending north-easterly with volatility<br />
and will spike through $1500 very shortly,<br />
then through $2000 in the next year or two.”<br />
On Indonesia, he says 10 years ago with the<br />
Bre-X scandal and Asian financial crisis it was<br />
a difficult place to operate. “It went through a<br />
number of presidents, had economic instability,<br />
falling currency and the investment community<br />
at domestic and international levels<br />
had lost confidence. Since then it has seen<br />
significant improvement as stability has returned,<br />
along with economic growth and capital<br />
market development. It is a new BRIC<br />
nation with a big population, plenty of resources<br />
and new mining legislation.<br />
“CEO Peter Albert and I have been associated<br />
with Martabe for five years. We are not<br />
only very familiar with the asset but also all<br />
stakeholders and have established relationships<br />
with governments at national, regional<br />
and local levels as well as with communities.<br />
It is very important in Indonesia to have good<br />
relationships, particularly at district and community<br />
levels. <strong>The</strong>y cannot be established<br />
overnight, you have to work at them over<br />
time, there’s give and take, there’s building of<br />
confidence and trust, and you must work together<br />
to achieve common objectives.<br />
“Most communities want the same thing –<br />
jobs, training, education and facilities for themselves,<br />
their children and grandchildren. <strong>The</strong><br />
mining industry has wonderful opportunities to<br />
provide for remote and disadvantaged com-<br />
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PAID ADVERTISEMENT<br />
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munities. <strong>The</strong>re’s not a day goes by when we<br />
don’t think of how we operate with our social<br />
licence because without that we are nothing.”<br />
A ‘grandfathered’ project<br />
Peter Albert says the Martabe contract operates<br />
under a sixth generation Contract of<br />
Works “which makes it grandfathered under<br />
the Indonesian mining<br />
law”. He says<br />
the development of<br />
Martabe will be a<br />
positive signal for<br />
the district, region<br />
and country as a<br />
whole. “We have<br />
very good people,<br />
strong Indonesian<br />
management as<br />
First concrete is poured at Martabe by contractors<br />
PT Duta Graha Indha and PT Leighton Indonesia.<br />
well as experienced<br />
international mining<br />
people, who have<br />
all worked extremely<br />
hard to get Martabe<br />
close to the point of production.<br />
“<strong>The</strong> capital city of North Sumatera and<br />
third largest city in Indonesia is Medan, and<br />
there is easy access with short-hop flights to<br />
Medan from Kuala Lumpur or Singapore, or<br />
from Jakarta, which is less than two hours<br />
away. From Medan it is an hour flight to the<br />
west coast and port town of Sibolga.<br />
Martabe is about a 40 minute drive from Sibolga<br />
along the Trans-Sumatran Highway.<br />
Most large equipment is brought to site<br />
through this port. A coal-fired power station<br />
has recently been built at Sibolga supplying<br />
to the grid and we will take power from the<br />
grid which is only 3km from the mine site.”<br />
Mining has been around for decades in Indonesia,<br />
Peter Albert says, so there is a real<br />
depth of capability with professionals covering<br />
the full range of mining technical and<br />
commercial disciplines. “Martabe is a shortening<br />
of a three-word name in the local dialect<br />
which means ‘come back home and<br />
help build your village’. Many people from the<br />
area have become senior identities in the Indonesian<br />
mining industry, including Arif Siregar,<br />
an ex-president of the Indonesian Mining<br />
Association who formally gives us advice and<br />
whose family still live in the local village.<br />
Communication and consultation with the<br />
local community is fundamental to our success<br />
and we seek every avenue to enhance our capability<br />
in this area and to increase the knowledge<br />
and understanding of the local community.<br />
<strong>The</strong> Martabe CoW covers 1639sqkm of a<br />
highly mineralized area close to the Sumatran<br />
fault. “We have done exploration work<br />
throughout the CoW but most has centred on<br />
30sqkm, which is the Martabe project area.<br />
Within this area are six deposits and one of<br />
these, Purnama or Pit 1, is what we are building<br />
the project<br />
around. In the six<br />
deposits we have<br />
about 6.5 million<br />
ounces of gold resources<br />
and 66<br />
million ounces of<br />
silver resources<br />
with a gold equivalent<br />
reserve of 3.3<br />
million ounces,<br />
most of which is at<br />
Purnama. At the<br />
other deposits and<br />
prospects - Barani,<br />
Ramba Joring, Uluala<br />
Hulu, Tor Uluala and Horas - we are continuing<br />
exploration and building up resources.<br />
“Purnama is close to the surface, has very<br />
low strip ratio of about 1.3:1, good grade of<br />
about 2.1 grams/tonne gold and with silver<br />
credits increases to the equivalent of about<br />
2.6 grams/tonne. <strong>The</strong> deposit is open in most<br />
directions and has good sulphide potential at<br />
depth. It is a great starting point and with<br />
about 2.4 million ounces of reserves, makes<br />
it a world-class gold deposit in its own right.<br />
Construction work is progressing at Martabe with first production<br />
expected by the end of the year.<br />
“Annual design capacity of the plant is 4.5<br />
million tonnes and recovery is close to 80% for<br />
an output of 250,000 ounces per annum. Annual<br />
silver production will be 2-3 million ounces<br />
and with current prices at around $40 an<br />
ounce, it makes the project even more robust.<br />
“All fundamentals are in place for us to be a<br />
very low cost producer, at well below $300<br />
an ounce. It will cost $100-120 million to put<br />
the team on the field producing gold and silver,<br />
and when you tally up the figures it’s<br />
going to be very robust. When you plot us on<br />
the cash cost curve, we’re not just bottom<br />
quarter, we’re almost bottom decile.<br />
“We have more than 1200 people on site<br />
with key contractors being PT Ausenco, PT<br />
Leighton Indonesia and PT Duta Graha<br />
Indha. Ausenco is doing engineering and procurement,<br />
and will project manage plant construction.<br />
<strong>The</strong>y are close to 95% complete<br />
with engineering and procurement, and are<br />
now mobilizing to site. All of the major equipment<br />
is purchased and much is in warehouses<br />
and workshops waiting for us to<br />
press the button and have it delivered to site.<br />
“<strong>The</strong> earthworks construction is being<br />
done by Leighton and Duta Graha Indha,<br />
who have been on the ground at Martabe<br />
for six months, working on the tailings dam,<br />
roads and process plant. Concrete pours<br />
started on March 17. <strong>The</strong>re is a lot of Indonesian<br />
content with the contractors, subcontractors<br />
and suppliers.”<br />
Peter Albert says the near-mine future is<br />
very bright. “We have about 225,000 ounces<br />
of reserves at Barani, a reserve statement is<br />
due shortly for Ramba Joring and there are<br />
many more resource ounces at these and<br />
other deposits as well as a new resource<br />
likely at the new<br />
Horas deposit.<br />
“Within our designs<br />
we’ve allowed<br />
for expansion in annual<br />
capacity from<br />
4.5 million tonnes to<br />
6.6 million and after<br />
that it’s the sulphide<br />
opportunities which<br />
are largely untested.<br />
<strong>The</strong> near-mine opportunities<br />
have potential<br />
to nearly<br />
double the current<br />
mine life of nine years<br />
and then there is the<br />
rest of the CoW. We have an annual exploration<br />
budget of around $15 million with<br />
two-thirds for the near-mine work and the<br />
rest for regional work.”<br />
May/June 2011 | <strong>ASIA</strong> <strong>Miner</strong> | 43
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China<br />
CHINA’S GROWTH PATH STREWN WITH GOLD<br />
BY JOHN MILLER, <strong>ASIA</strong> MINER EDITOR<br />
CHINA is the dominant force in global gold<br />
production and is playing an increasingly important<br />
role in gold markets as the standard<br />
of living of its 1 billion-plus residents improves<br />
and its economy strengthens.<br />
<strong>The</strong> future for gold mining in China is huge,<br />
according to Majestic Gold’s president Rod<br />
Husband. “China has gone from number six<br />
producer in the world in 2003 to number one.<br />
South Africa has gone down in terms of production<br />
and China has gone up to more than<br />
10 million ounces a year.”<br />
Majestic is one of a handful of foreign companies<br />
that have remained in China through<br />
the thick and thin of economic booms and<br />
the global financial crisis and is about to reap<br />
the benefits by becoming a large-scale producer<br />
at its Songjiagou project.<br />
Rod Husband told <strong>The</strong> <strong>ASIA</strong> <strong>Miner</strong> that<br />
China has a very high affinity for gold and the<br />
government buys every ounce that’s sold<br />
through the Shanghai Metals Exchange. “Individuals<br />
in China who want gold have to find<br />
other ways to buy it.<br />
“I don’t know what their long-term foreign<br />
exchange strategy is but it seems they are<br />
happy to convert their US dollars to gold and<br />
potentially go to a gold standard. If that is the<br />
case then the gold industry will be in a great<br />
position for years.<br />
“About 10 years ago China opened up the<br />
doors to bring in western exploration expertise,<br />
which helped them change their mining<br />
industry with a lot of resources defined. Some<br />
foreign companies had success and became<br />
miners, like Silvercorp and Eldorado with Majestic<br />
about to do the same, but when the<br />
downturn came many others sold the resources<br />
back to China which is now pushing<br />
them into production.<br />
“This expertise enabled China to increase<br />
production which, together with the economic<br />
boom the country has experienced, means<br />
China has a growing surplus of cash and is<br />
able to take back more control of exploration.”<br />
Majestic came to China in 2003 and was<br />
one of the earliest foreign companies to test<br />
the waters. Today there are not many foreign<br />
companies operating in China. Rod Husband<br />
says in 2005 it was something like 200 but<br />
now there are only about 25. While many Chinese<br />
companies are more proficient at all aspects<br />
of exploration and mining, the global<br />
downturn also took its toll on many foreign<br />
companies in China.<br />
He says with the way deals are structured<br />
in China with joint venture companies having<br />
to contribute capital, the downturn meant<br />
many had difficulty meeting commitments<br />
with the result that the government or Chinese<br />
partners bought back the projects, and<br />
did so at fair value.<br />
“<strong>The</strong>y recognized the work that had been<br />
done and paid fair price. We did that with our<br />
Sawayaerdun project which was fairly remote<br />
and logistically challenging for us. It had huge<br />
potential and we had spent about $8 million<br />
through our joint venture but the government<br />
came and bought it back for $9 million. We<br />
needed that money to focus on Songjiagou<br />
so it was a good deal for everyone.”<br />
<strong>The</strong> Chinese need resources to feed their<br />
growth and while they are doing much to lift<br />
domestic exploration and production, they<br />
are also looking to overseas sources.<br />
“<strong>The</strong>y want the metal and will get it one way<br />
or another,” Rod Husband says. “Now they<br />
have to buy concentrate at higher prices but<br />
what they want to do is go down the food<br />
chain and add value. With copper the average<br />
global cost for production is $1.50-$1.75<br />
a pound. You can buy copper for $4.30 a<br />
pound or if you mine it you can produce it and<br />
sell the concentrate for $2 a pound and the<br />
value adding goes to the smelter. What China<br />
is looking at is producing from the basic level<br />
in which case the cost of that pound of copper<br />
becomes 50 or 60 cents and the value<br />
gets added in China.<br />
“China is buying up resources around the<br />
world – they are buying juniors in Australia, buying<br />
projects in Africa and investing in Canadian<br />
companies. <strong>The</strong>y went after the big companies<br />
first but did not succeed. <strong>The</strong>y are still interested<br />
in them but have realized it is politically difficult<br />
so now they are buying the future of those big<br />
companies – the juniors. <strong>The</strong> big companies<br />
currently sustain through acquisitions, buying<br />
junior companies and their resources, thus<br />
maintaining their resource bases. So, China is<br />
now buying many juniors and projects, depriving<br />
big companies of their future resources.”<br />
Rod Husband says China’s influence on the<br />
global gold industry will continue to increase.<br />
“Just look at per capita consumption and<br />
how that has changed. When Majestic entered<br />
China the nation’s annual per capita<br />
gold consumption was just under 0.2 grams,<br />
the world average was about 0.6 and western<br />
countries consumed 0.8. Now China is<br />
up to 0.25 or 0.26 grams and is catching up<br />
to the west. India has a higher affinity than the<br />
west at 1 gram and that’s where we expect<br />
China to get to. If China just gets to the 0.6<br />
gram mark, that’s a 25% increase in consumption,<br />
or 10 million ounces, which is how<br />
much China now produces.<br />
“So what’s going to happen to gold prices<br />
and gold demand <strong>The</strong>re’s no question it’s<br />
going up and up. It is considered by many as<br />
a currency now and all major funds are trading<br />
gold like they trade Dollar-Euro or Dollar-Yen.<br />
<strong>The</strong>re’s probably going to be a lot of pressure<br />
for it to get there, but in terms of demand I can<br />
easily see it going to $3000,” he added.<br />
中 国 发 展 之 路 铺 满 黄 金<br />
中 国 市 场 是 全 球 黄 金 市 场 的 主 导 力 量 , 随 着<br />
超 过 十 亿 人 口 的 生 活 水 平 不 断 提 高 以 及 经 济<br />
发 展 不 断 增 强 , 中 国 因 素 正 在 全 球 黄 金 市 场<br />
中 发 挥 着 日 益 重 要 的 作 用 。<br />
根 据 Majestic 金 矿 公 司 总 裁 Rod Husband<br />
的 观 点 , 在 中 国 进 行 金 矿 开 发 的 前 景 十 分 广<br />
大 。“ 中 国 的 黄 金 产 量 从 2003 年 全 球 第 六 升<br />
至 现 在 的 第 一 位 。 南 非 的 产 量 正 在 递 减 而 中<br />
国 年 产 量 已 经 超 过 一 千 万 盎 司 。”<br />
Majestic 金 矿 公 司 是 屈 指 可 数 的 几 个 历 经<br />
经 济 繁 荣 时 期 和 全 球 金 融 危 机 的 跌 宕 起 伏 后<br />
仍 留 守 在 中 国 的 外 国 公 司 之 一 , 旗 下 的 宋 家<br />
沟 项 目 就 要 开 始 大 规 模 生 产 , 公 司 即 将 收 获<br />
硕 果 。<br />
Rod Husband 告 诉 《 亚 洲 矿 业 》 杂 志 , 中<br />
国 人 喜 爱 黄 金 , 而 政 府 几 乎 买 光 了 所 有 在 上<br />
海 金 属 交 易 所 出 售 的 黄 金 ,“ 中 国 想 买 黄 金<br />
的 个 人 只 能 寻 找 其 他 途 径 购 买 。”<br />
“ 我 不 清 楚 中 国 的 长 期 外 汇 战 略 将 是 什<br />
么 , 但 他 们 似 乎 乐 于 将 美 元 转 换 成 金 条 , 并<br />
且 有 可 能 走 向 金 本 位 制 。 如 果 是 这 样 的 话 那<br />
黄 金 行 业 将 在 未 来 多 年 内 处 于 极 佳 地 位 。”<br />
“ 大 约 十 年 前 中 国 采 取 开 放 政 策 , 引 进 西<br />
方 勘 探 专 业 技 术 , 大 大 改 变 了 中 国 的 矿 业 局<br />
面 , 确 定 了 许 多 资 源 。” 一 些 外 国 公 司 取 得<br />
了 成 功 , 成 为 采 矿 公 司 , 比 如 希 尔 威 矿 业 和<br />
44 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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China<br />
埃 尔 拉 多 黄 金 公 司 ,Majestic 公 司 也 是 如<br />
此 。 但 是 当 行 业 不 景 气 时 , 许 多 外 国 公 司 将<br />
项 目 卖 回 给 中 国 , 而 中 国 现 在 正 在 使 这 些 项<br />
目 尽 快 生 产 。<br />
“ 这 些 专 业 技 术 帮 助 了 中 国 提 高 黄 金 产<br />
量 , 再 加 上 这 个 国 家 正 在 经 历 的 经 济 蓬 勃 发<br />
展 , 意 味 着 中 国 有 着 日 益 增 长 的 富 余 现 金 流<br />
收 回 对 资 源 勘 探 的 控 制 权 。”<br />
Majestic 金 矿 公 司 于 2003 年 来 到 中 国 , 是<br />
第 一 批 试 水 的 先 行 者 。 现 在 在 中 国 也 没 有 太<br />
多 处 于 运 营 阶 段 的 外 国 公 司 。Rod Husband<br />
说 2005 年 的 时 候 大 概 有 200 家 , 而 今 只 剩 下<br />
25 家 。 众 多 中 国 企 业 无 论 在 勘 探 还 是 开 采<br />
方 面 都 更 加 精 通 了 , 而 世 界 经 济 衰 退 对 许 多<br />
在 中 国 的 外 国 公 司 打 击 颇 大 。<br />
他 说 这 与 国 内 许 多 项 目 合 作 结 构 有 关 , 一<br />
般 来 说 合 资 公 司 需 要 贡 献 资 本 金 , 而 经 济 危<br />
机 使 得 他 们 难 以 满 足 合 作 时 做 出 的 承 诺 , 结<br />
果 自 然 是 中 国 政 府 或 中 方 合 作 方 以 公 平 的 价<br />
格 将 项 目 赎 回 。<br />
“ 他 们 认 可 前 期 已 投 入 的 工 作 量 所 以 支 付<br />
了 合 理 价 格 。 我 们 的 萨 瓦 亚 尔 顿 就 是 这 样<br />
的 , 这 个 项 目 地 处 偏 远 , 对 我 们 而 言 在 运 输<br />
方 便 是 一 个 挑 战 。 项 目 潜 力 巨 大 , 我 们 在 合<br />
资 公 司 投 入 了 800 万 美 金 , 政 府 回 购 的 价 格<br />
则 是 900 万 美 金 。 我 们 也 需 要 这 笔 钱 投 入 到<br />
宋 家 沟 项 目 , 这 对 合 作 各 方 都 是 一 笔 不 错 的<br />
交 易 。”<br />
中 国 需 要 资 源 来 满 足 经 济 增 长 , 他 们 正 努<br />
力 提 升 国 内 勘 探 和 开 发 , 同 时 也 在 寻 找 海 外<br />
资 源 。<br />
“ 中 国 需 要 金 属 , 他 们 将 以 这 样 或 那 样 的<br />
方 式 获 得 ,” Rod Husband 说 。 “ 现 在 他 们<br />
不 得 不 购 买 价 格 较 高 的 精 矿 , 但 他 们 真 正 想<br />
做 是 深 入 食 物 链 下 游 以 获 取 增 加 值 。 铜 的 全<br />
球 平 均 生 产 成 本 为 1.50 - 1.75 美 元 / 磅 。 你 可<br />
以 以 每 磅 4.30 美 元 的 价 格 购 买 铜 , 或 是 自 己<br />
开 矿 然 后 生 产 并 以 2 美 元 / 磅 的 价 格 出 售 铜 精<br />
矿 , 从 而 铜 冶 炼 厂 获 得 这 部 分 的 附 加 值 。 中<br />
国 正 在 寻 求 的 是 基 本 层 面 上 的 生 产 , 在 这 种<br />
情 况 下 , 每 磅 铜 的 成 本 是 50 或 60 美 分 , 增<br />
加 的 附 加 值 由 中 国 获 得 。<br />
“ 中 国 是 在 世 界 范 围 内 到 处 购 买 资 源 - 他 们<br />
在 澳 大 利 亚 收 购 小 型 公 司 , 在 非 洲 买 项 目 ,<br />
在 加 拿 大 进 行 股 权 投 资 。 他 们 的 首 要 追 逐 目<br />
标 是 那 些 大 型 矿 业 公 司 , 但 没 有 成 功 。 但 他<br />
们 仍 然 感 兴 趣 , 但 意 识 到 这 样 的 方 式 具 有 政<br />
治 困 难 , 所 以 现 在 他 们 购 买 了 未 来 可 能 成 为<br />
大 公 司 的 潜 力 股 —— 小 型 公 司 。 大 公 司 一 般<br />
通 过 收 购 ( 购 买 小 型 公 司 和 其 资 源 ) 来 维 持<br />
他 们 的 资 源 储 备 。 所 以 , 中 国 现 在 正 是 购 买<br />
许 多 小 型 公 司 和 项 目 , 拿 走 了 大 公 司 未 来 的<br />
资 源 来 源 。”<br />
他 还 说 中 国 对 全 球 黄 金 行 业 的 影 响 还 将 继<br />
续 增 强 。“ 只 消 看 一 眼 人 均 消 费 量 以 及 这 个<br />
数 字 是 如 何 改 变 的 。 当 公 司 刚 进 入 中 国 时 那<br />
时 人 均 黄 金 消 费 量 略 低 于 0.2 克 , 那 时 世 界<br />
平 均 水 平 约 为 0.6 克 , 西 方 国 家 为 0.8 克 。 现<br />
在 中 国 人 均 消 费 量 高 达 0.25 甚 至 0.26 克 , 正<br />
在 追 赶 西 方 。 印 度 人 比 西 方 更 热 衷 于 对 金 子<br />
的 消 费 , 人 均 消 费 量 高 达 1 克 , 这 正 是 我 们<br />
预 计 中 国 将 达 到 的 水 平 。 如 果 中 国 的 人 均 消<br />
费 量 停 留 在 0.6 克 大 关 , 也 就 是 说 消 费 增 长<br />
25%, 折 合 10 万 盎 司 金 , 这 是 数 字 正 好 与<br />
中 国 的 现 有 产 量 持 平 。<br />
“ 所 以 说 黄 金 价 格 和 黄 金 的 需 求 将 何 去 何<br />
从 呢 毫 无 疑 问 , 将 逐 步 攀 升 。 许 多 人 都 认<br />
为 金 子 是 一 种 货 币 , 所 有 的 大 型 基 金 都 在 像<br />
交 易 美 元 对 欧 元 或 美 元 对 日 元 一 样 进 行 黄 金<br />
交 易 。 可 能 在 上 升 过 程 中 要 遭 遇 很 多 压 力 ,<br />
但 从 需 求 角 度 出 发 , 我 觉 得 3000 美 元 每 盎<br />
司 不 难 达 到 ,” 他 补 充 说 。<br />
A Majestic transformation<br />
MAJESTIC Gold is transforming from explorer<br />
and very small-scale producer into a largescale<br />
production company through ongoing<br />
development of the Songjiagou Gold Project<br />
in Shandong province.<br />
<strong>The</strong> company is processing 1400 tonnes<br />
each day through the existing Songjiagou<br />
plant but is in the final stages of constructing<br />
a new mill with daily capacity of 6000 tonnes.<br />
It expects to begin throughput at the new mill<br />
during May, which will bring daily processing<br />
at Songjiagou to 7400 tonnes.<br />
Majestic’s president and CEO Rod Husband<br />
says the company is ramping up mining activity<br />
to feed the new mill with material being<br />
stockpiled at the mill ready for processing.<br />
He says based on a recent preliminary assessment<br />
report prepared by Wardrop, a Tetra<br />
Tech company, Majestic will be able to produce<br />
around 105,000 ounces annually for the<br />
next 22 years, however, the company is considering<br />
additional capacity expansion in the<br />
next few years as 22 years is a lengthy mine<br />
life and it should be more like 10-15 years.<br />
“We are also focused on completing a detailed<br />
five year mine plan and then implementing<br />
it so we have proper grade control. At<br />
present we just dig the dirt and run it through<br />
the mill but once we have a proper plan and<br />
grade control we expect to be able to lift production<br />
substantially, up to 250,000 ounces.”<br />
<strong>The</strong> Wardrop report also recommends two<br />
phases of exploration designed to upgrade<br />
and expand the resource with the first<br />
phase focusing on increasing the level of<br />
confidence in the shallower portion of the<br />
resource and the second focusing on<br />
deeper mineralization as well as additional<br />
resources at depth and along strike.<br />
Rod Husband says, “It’s an exciting time as<br />
we are just months away from transforming<br />
to a full-on production company and it’s really<br />
largely because we are in China. You can’t do<br />
that in North America – you have to wait for<br />
engineering reports, obtain the capex and<br />
then build the mill.<br />
New processing facilities under construction at Majestic Gold’s Songjiagou project in Shandong province.<br />
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China<br />
“ 我 们 的 合 作 伙 伴 , 即 公 司 的 大 股 东 , 为<br />
项 目 建 设 提 供 了 资 金 , 他 清 楚 地 知 道 那 里 有<br />
什 么 。 他 曾 经 在 此 进 行 了 长 达 七 年 的 小 规 模<br />
开 采 , 所 以 只 是 一 个 认 识 到 项 目 规 模 效 益 后<br />
进 行 扩 产 的 问 题 。”<br />
他 还 说 Majestic 金 矿 公 司 还 在 评 估 其 他 几<br />
个 中 国 的 项 目 。“ 其 中 一 个 是 位 于 中 国 南 方<br />
的 小 型 露 天 开 采 矿 , 采 用 氰 化 物 浸 出 工 艺 。<br />
正 在 进 行 尽 职 调 查 , 我 们 认 为 它 可 能 含 有<br />
50 万 到 100 万 盎 司 的 金 。”<br />
“ 通 过 这 个 项 目 我 们 将 获 得 事 业 拓 展 所 必<br />
要 的 现 金 流 , 正 如 大 家 所 知 , 在 中 国 有 着 巨<br />
大 的 机 会 。 我 们 面 临 的 地 质 风 险 较 低 , 因 为<br />
介 入 的 是 未 经 充 分 勘 探 的 已 有 矿 山 , 你 所 需<br />
要 做 的 仅 仅 是 将 资 源 钻 探 出 来 , 并 重 新 设 计<br />
开 采 方 案 。”<br />
Rod Husband 说 公 司 同 时 在 考 虑 将 在 中 国<br />
国 内 的 这 部 分 资 产 拿 出 来 在 香 港 上 市 。“ 香<br />
港 平 台 上 的 亚 洲 投 资 者 对 外 国 公 司 具 有 更 开<br />
放 的 态 度 。 上 市 的 成 本 很 高 , 要 求 项 目 至 少<br />
值 一 亿 港 元 以 上 才 划 算 , 我 们 希 望 能 到 达 那<br />
个 阶 段 。”<br />
<strong>The</strong> Mei Feng Coal Project of China Coal Corporation in Xinjiang province.<br />
“Our partner, the company’s biggest<br />
shareholder, has funded construction as we<br />
progressed because he knows what’s there.<br />
He’s been mining it for seven years on a<br />
small scale and it’s just a matter of recognizing<br />
the economies of scale and making<br />
the operation bigger.”<br />
He says Majestic is evaluating a couple of<br />
other projects in China. “One of them is a<br />
small open pit, cyanide leach operation in<br />
southern China. We are doing due diligence<br />
and think it has the potential to hold between<br />
500,000 and 1 million ounces.<br />
“We will have the cashflow to expand organically<br />
from here and, as everyone knows, there<br />
are tremendous opportunities in China. <strong>The</strong><br />
geological risk is low because you do deals on<br />
existing mines that haven’t been explored<br />
properly, so all you have to do is drill out the<br />
resource then redesign the way to mine it.”<br />
Rod Husband says Majestic is also considering<br />
listing Chinese assets on the Hong<br />
Kong exchange. “It seems Asian investors<br />
through Hong Kong have a much more open<br />
attitude towards foreign companies. It’s expensive<br />
to list so you need projects worth at<br />
least $100 million to make it worthwhile and<br />
we are hopeful of getting to that stage.”<br />
Majestic 公 司 的 重 大 角 色 转 换<br />
随 着 山 东 省 宋 家 沟 金 矿 项 目 的 不 断 推 进 ,<br />
Majestic 金 矿 公 司 正 在 从 勘 探 和 小 规 模 生 产<br />
商 转 型 为 大 规 模 生 产 商 。<br />
现 阶 段 该 公 司 的 宋 家 沟 选 厂 日 处 理 量 为<br />
1400 吨 , 正 在 建 设 中 的 规 划 日 处 理 量 6000<br />
吨 的 新 选 厂 已 处 在 收 尾 阶 段 。 预 计 这 一 新<br />
选 厂 将 在 5 月 份 投 产 , 由 此 宋 家 沟 项 目 的 日<br />
处 理 量 将 达 到 7400 吨 。<br />
Majestic 金 矿 公 司 总 裁 长 兼 首 席 执 行 官 Rod<br />
Husband 说 正 在 进 行 矿 山 扩 产 以 满 足 选 厂<br />
的 处 理 量 。 物 料 正 被 堆 积 在 选 厂 准 备 下 一<br />
步 处 理 。<br />
据 他 介 绍 , 根 据 一 份 由 Wardrop 公 司 (<br />
Tetra Tech) 完 成 的 最 新 初 步 评 估 报 告 ,Majestic<br />
金 矿 公 司 将 在 今 后 的 22 年 内 年 产 金<br />
10.5 万 盎 司 , 但 公 司 正 在 考 虑 在 数 年 内 进 一<br />
步 扩 产 ,22 年 的 矿 山 寿 命 相 对 较 长 , 应 该<br />
在 10 至 15 年 之 间 。<br />
“ 我 们 还 在 集 中 精 力 完 成 一 份 详 细 的 五 年<br />
采 矿 计 划 然 后 实 施 , 从 而 做 好 合 适 的 品 位 控<br />
制 。 目 前 我 们 还 只 是 进 行 简 单 的 开 采 然 后 输<br />
送 到 选 厂 , 一 旦 有 了 合 适 的 开 采 计 划 和 品 位<br />
控 制 , 我 们 期 待 将 产 量 大 幅 提 升 到 可 能 高 达<br />
25 万 盎 司 。”<br />
Wardrop 公 司 的 评 估 报 告 建 议 进 行 再 做 两<br />
个 阶 段 的 勘 探 以 提 升 和 扩 大 资 源 量 , 第 一 阶<br />
段 重 点 提 高 浅 部 资 源 的 可 信 度 , 第 二 阶 段 重<br />
点 关 注 深 部 成 矿 以 及 深 部 和 沿 走 向 延 伸 的 更<br />
多 资 源 。<br />
Rod Husband 说 :“ 我 们 离 成 为 一 个 完 全 的<br />
生 产 商 仅 有 几 个 月 的 距 离 , 这 真 是 让 人 激<br />
动 , 这 大 部 分 得 益 于 项 目 是 在 中 国 。 这 要 是<br />
在 北 美 完 全 行 不 通 —— 要 等 设 计 报 告 , 获 得<br />
基 建 成 本 然 后 才 能 建 设 选 厂 。”<br />
Report confirms Mei Feng potential<br />
AN independent report commissioned by<br />
China Coal Corporation in relation to its proposed<br />
acquisition of the Mei Feng Coal Project<br />
in Xinjiang province states that Mei Feng<br />
represents a mineable underground deposit<br />
and orderly extraction of the reserve should<br />
proceed as planned.<br />
<strong>The</strong> NI 43-101 Technical Report prepared<br />
by Norwest Corp indicates that there is a resource<br />
on the property worthy of current mining<br />
operations, additional exploration and<br />
further development.<br />
<strong>The</strong> current mine owners have secured all<br />
leases and permits for mining, so the report<br />
states that only maintenance of these is required<br />
in the future. It indicates estimates of required<br />
capital, manpower and equipment for<br />
the surface mine operations are reasonable,<br />
and that projected tonnages are reasonable<br />
based on the reserves associated with the<br />
mine. <strong>The</strong>re are measured and indicated resources<br />
of 18.138 million tonnes and inferred<br />
resources of 892,120 tonnes with potential to<br />
add to this through further exploration. As at<br />
December 16, 2010, the reserve total was<br />
7.692 million tonnes from nine seams. Reserves<br />
are reported on a clean basis rather than a runof-mine<br />
basis because ROM coal is not sold as<br />
a product but further processed to produce a<br />
saleable product suitable for the local market.<br />
China Coal’s chief financial officer Mark<br />
Roth told <strong>The</strong> <strong>ASIA</strong> <strong>Miner</strong> that after listing on<br />
the TSX Venture Exchange in May 2010,<br />
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China<br />
China Coal’s Chinese subsidiary signed an<br />
agreement to acquire 60% of the operating<br />
Mei Feng mine for about 150 million RMB.<br />
He says China Coal then engaged Norwest<br />
to prepare the report and in January this year<br />
formed a Technical Advisory Board to review<br />
operations and acquisitions, and recommend<br />
on safety and expansion projects.<br />
“Construction of an underground mine was<br />
completed last year and a mandatory sixmonth<br />
productivity and safety testing phase<br />
was completed in the third quarter. Mine construction<br />
consists of 6000 metres of tunnels<br />
and initial production from the B3 and B8 metallurgical<br />
coal seams began last September.<br />
“At present annual production is about<br />
300,000 tonnes and China Coal intends to increase<br />
this to 900,000 tonnes.”<br />
Mark Roth says there are two coking plants<br />
within 50km of the mine that require 2.7 million<br />
tonnes of coking coal each year while there are<br />
also three large power plants within 95km that<br />
annually require 6.9 million tonnes of thermal<br />
coal, ensuring strong demand for the coking<br />
and thermal coal found at Mei Feng.<br />
<strong>The</strong> technical report indicates that the<br />
basic coal quality testing parameters are the<br />
same using either the Chinese standards or<br />
ASTM procedures. It also indicates the B8<br />
seam is uniform with relatively complex<br />
structure but mineable in the whole area,<br />
has a true thickness from 1.04 to 5.33 metres<br />
with an average of 3.06 and continuity<br />
is stable. <strong>The</strong> B3 seam is relatively uniform<br />
throughout with simple structure, true thickness<br />
is 1.80 to 5.39 metres with an average<br />
thickness of 3.71 metres and continuity is<br />
relatively stable.<br />
Norwest’s visit to the mine verified that<br />
safety equipment had been installed as recommended<br />
in the feasibility study.<br />
China Coal is focused on acquisition of<br />
existing producing, or formerly producing,<br />
coal mines, properties and related assets in<br />
China. As well as acquiring Mei Feng, the<br />
company is undertaking due diligence on<br />
another two mines being considered as acquisition<br />
targets.<br />
<strong>The</strong> company’s five year objective is annual<br />
production of 5 million tonnes and Mei<br />
Fung will eventually represent almost 20%<br />
of this goal.<br />
报 告 肯 定 美 丰 煤 矿 的 潜 力<br />
中 国 煤 炭 集 团 有 限 公 司 (China Coal Corporation)<br />
委 托 进 行 的 一 份 关 于 新 疆 美 丰 煤 矿<br />
项 目 收 购 的 独 立 报 告 指 出 , 美 丰 煤 矿 是 一 个<br />
可 开 采 的 地 下 矿 床 , 应 按 照 原 定 计 划 有 序 地<br />
进 行 开 采 。<br />
Norwest 公 司 出 具 的 NI 43-101 技 术 报 告 表<br />
明 , 该 矿 的 资 源 值 得 进 行 目 前 的 采 矿 作 业 ,<br />
并 且 值 得 进 行 补 充 勘 探 和 进 一 步 开 发 。<br />
目 前 项 目 业 主 已 获 得 所 有 的 采 矿 租 约 和 许<br />
可 证 , 因 此 报 告 指 出 , 未 来 只 需 要 对 矿 山 设<br />
施 进 行 基 本 的 维 护 保 养 。 报 告 认 为 地 表 开 采<br />
所 需 的 资 金 、 人 力 投 入 和 设 备 配 置 是 合 理<br />
的 , 且 基 于 矿 山 储 量 得 出 的 项 目 矿 石 量 也 是<br />
合 理 的 。<br />
探 明 和 控 制 级 别 资 源 量 是 1813.80 万 吨 ,<br />
推 断 级 别 资 源 量 89.2120 万 吨 , 且 有 进 一 步<br />
通 过 勘 探 工 作 提 升 的 潜 力 。 截 至 2010 年 12<br />
月 16 日 , 九 个 煤 层 的 总 储 量 是 769.2 万 吨 。<br />
且 储 量 估 算 是 按 净 煤 计 算 的 , 而 非 毛 煤 量 ,<br />
因 为 毛 煤 将 不 会 被 直 接 出 售 , 而 是 要 进 一 步<br />
加 工 出 适 合 当 地 市 场 的 可 销 售 产 品 。<br />
中 国 煤 炭 集 团 有 限 公 司 的 首 席 财 务 官 Mark<br />
Roth 告 诉 《 亚 洲 矿 业 》 杂 志 , 公 司 2010 年<br />
5 月 在 多 伦 多 证 券 交 易 所 创 业 板 上 市 后 ,<br />
旗 下 的 中 国 子 公 司 签 署 了 一 份 以 1.5 亿 元<br />
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China<br />
人 民 币 代 价 收 购 正 在 运 营 中 的 美 丰 煤<br />
矿 60% 权 益 的 协 议 。<br />
他 说 , 公 司 随 后 聘 请 了 Norwest 公 司 准 备<br />
相 关 报 告 , 并 在 今 年 1 月 成 立 了 一 个 技 术 咨<br />
询 委 员 会 , 负 责 审 查 项 目 运 作 和 收 购 , 并 为<br />
矿 山 安 全 和 扩 建 提 供 技 术 建 议 。<br />
“ 地 下 矿 井 建 设 已 于 去 年 完 成 , 强 制 性 的<br />
六 个 月 期 生 产 效 率 和 安 全 性 测 试 也 已 第 三 季<br />
度 结 束 。 矿 山 掘 进 了 长 6000 米 的 巷 道 , 首<br />
采 区 的 B3 和 B8 煤 层 冶 金 煤 生 产 于 去 年 九 月<br />
开 始 。<br />
“ 目 前 年 产 量 约 30 万 吨 , 公 司 计 划 提 高 到<br />
90 万 吨 。”<br />
Mark Roth 说 距 离 煤 矿 50 公 里 内 的 两 家 炼<br />
焦 厂 每 年 需 焦 煤 270 万 吨 , 同 时 方 圆 95 公 里<br />
内 还 有 三 家 大 型 火 电 厂 , 年 需 热 煤 690 万 吨<br />
, 保 证 了 美 丰 煤 矿 出 产 的 焦 煤 和 热 煤 有 着 强<br />
劲 的 需 求 。<br />
技 术 报 告 显 示 无 论 是 中 国 还 是 美 国 ASTM<br />
标 准 检 测 程 序 , 煤 炭 质 量 检 测 的 基 本 参 数 都<br />
相 同 。 这 也 意 味 着 B8 煤 层 均 一 性 较 好 , 相<br />
对 结 构 复 杂 但 全 部 可 采 , 真 实 煤 层 厚 度 介<br />
于 1.04 米 到 5.33 米 之 间 , 平 均 3.06 米 , 连 续<br />
性 稳 定 。B3 煤 层 从 头 到 尾 相 对 均 一 , 结 构<br />
简 单 , 真 实 厚 度 介 于 1.80 米 到 5.39 米 之 间 ,<br />
平 均 3.71 米 , 连 续 性 相 对 稳 定 。<br />
Norwest 公 司 的 现 场 考 察 核 实 , 已 按 可 行<br />
性 研 究 建 议 在 矿 井 安 装 了 安 全 设 备 。<br />
中 国 煤 炭 集 团 有 限 公 司 的 业 务 核 心 是 收 购<br />
中 国 国 内 目 前 正 在 生 产 或 曾 经 生 产 的 煤 矿 或<br />
其 他 矿 种 及 其 相 关 资 产 。 除 了 收 购 美 丰 项 目<br />
外 , 该 公 司 正 就 另 外 两 个 收 购 目 标 矿 山 进 行<br />
尽 职 调 查 。<br />
该 公 司 的 五 年 期 目 标 是 年 产 煤 500 万 吨 ,<br />
美 丰 最 终 将 贡 献 这 一 目 标 的 近 20%。<br />
First phase expansion at Pingyao facility<br />
WORK is under way on the first phase expansion<br />
of China Magnesium Corporation’s<br />
Officials from Pingyao County and China Magnesium Corporation at the<br />
ground breaking ceremony for the Pingyao Magnesium Project first phase expansion.<br />
Pingyao Magnesium Project in Shanxi<br />
province. <strong>The</strong> expansion will bring total annual<br />
capacity at the processing facility to<br />
20,000 tonnes.<br />
Earthworks have started after China Magnesium’s<br />
subsidiary CMC China was formally<br />
granted 50 year land use rights for the expansion.<br />
<strong>The</strong> granting of the rights, which cover<br />
60,000 square metres adjacent to the existing<br />
plant, enables CMC China to boost annual<br />
production to 20,000 tonnes by the end<br />
of 2011 and 105,000 tonnes by 2013.<br />
Capital works to upgrade and refurbish the<br />
existing plant began in December 2010<br />
while earthworks on the new land began<br />
after a ground-breaking ceremony in early<br />
March. <strong>The</strong> Pingyao County Government<br />
arranged and hosted the ceremony, which<br />
was attended by Pinhyao Mayor Hui Zhing<br />
Li and more than 100 other officials. <strong>The</strong><br />
Mayor said, “Our government will fully support<br />
your magnesium company because it is<br />
one of the eight key projects in the Shanxi<br />
province and the city’s number one project.”<br />
China Magnesium’s executive director and<br />
chief operating officer Xinping Liang said, “<strong>The</strong><br />
company enjoys a high degree of respect from<br />
the local community and government, and we<br />
are fortunate to have this depth of local support.<br />
Also, we are excited to have reached this<br />
stage in development of the project, for which<br />
both the existing plant upgrade and first phase<br />
expansion are still very much within budget<br />
and on or ahead of time.”<br />
China Magnesium believes it will benefit<br />
from the recent announcement by China’s<br />
Ministry of Industry and Information Technology<br />
of strict new conditions for companies<br />
working within or planning to enter the<br />
magnesium industry in China. <strong>The</strong> conditions<br />
set high standards for the layout, production<br />
capacity and environmental<br />
protection for the industry.<br />
<strong>The</strong> conditions for existing and future magnesium<br />
production facilities are:<br />
• Existing refineries - must have annual production<br />
capacity of at least 15,000<br />
tonnes. If an existing refinery wishes to<br />
apply for renovation or expansion, it will<br />
need to have a production capacity of at<br />
least 20,000 tonnes.<br />
• New refineries - Must have a planned capacity<br />
of at least 50,000 tonnes.<br />
In addition new refining projects will be prohibited<br />
in areas 1km from drinking water<br />
sources, basic farmland protection areas,<br />
natural reserves, scenic spots and other<br />
areas that require strict environmental quality.<br />
China Magnesium’s managing director Tom<br />
Blackhurst says, “China produces more than<br />
80% of the world’s magnesium and a significant<br />
proportion of this is from low capacity<br />
magnesium plants. China Magnesium is in<br />
the enviable position of having permits in<br />
place covering not only the current first phase<br />
expansion to 20,000 tonnes, but for increases<br />
up to 105,000 tonnes.<br />
“<strong>The</strong> conditions are intended to ensure the<br />
industry operates in an efficient and environmentally<br />
responsible manner. It will consolidate<br />
the company’s position as we will be<br />
one of the first producers to meet the new industry<br />
standards through the upgrade of existing<br />
facilities and first phase expansion.”<br />
平 遥 项 目 一 期 扩 建<br />
中 国 镁 业 有 限 公 司 在 山 西 省 平 遥 的 镁 金 属 项<br />
目 开 始 一 期 扩 建 。 此 次 扩 建 将 把 年 生 产 能 力<br />
提 升 至 20000 吨 。<br />
在 中 国 镁 业 的 子 公 司 (CMC 中 国 ) 获 得 第<br />
一 阶 段 扩 建 所 需 的 50 年 土 地 使 用 权 后 , 土<br />
木 工 程 随 即 展 开 。 获 批 的 土 地 使 用 面 积 共 计<br />
6 万 平 方 米 毗 邻 现 有 工 厂 , 扩 建 将 使 CMC(<br />
中 国 ) 的 年 生 产 能 力 在 2011 年 底 之 前 达 到<br />
20000 吨 , 在 2013 年 达 到 105000 吨 。<br />
升 级 和 翻 新 现 有 工 厂 的 基 础 建 设 工 程 已 在<br />
2010 年 12 月 开 始 , 在 2011 年 3 月 份 随 着 奠 基<br />
仪 式 的 举 行 土 木 工 程 建 设 也 随 即 展 开 。 奠 基<br />
仪 式 由 平 遥 县 政 府 主 持 , 包 括 平 遥 县 县 长 李<br />
非 忠 在 内 的 100 余 位 官 员 参 加 了 奠 基 仪 式 。<br />
李 非 忠 说 :“ 我 们 将 全 力 支 持 镁 业 公 司 , 该<br />
项 目 是 山 西 省 八 大 重 点 项 目 之 一 , 也 是 平 遥<br />
县 最 重 要 的 项 目 。”<br />
中 国 镁 业 公 司 总 经 理 和 首 席 运 营 官 梁 新 平<br />
说 :“ 中 国 镁 业 公 司 受 到 了 当 地 政 府 的 高 度<br />
重 视 , 我 们 十 分 幸 运 能 够 获 得 当 地 政 府 如 此<br />
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大 的 支 持 。 现 有 设 备 升 级 和 一 期 扩 建 成 本 完<br />
全 在 预 算 当 中 且 在 时 间 上 早 于 预 期 , 我 们 为<br />
目 前 开 发 已 取 得 的 成 绩 欢 欣 鼓 舞 。”<br />
工 业 和 信 息 化 产 业 部 日 前 出 台 新 规 , 对 镁<br />
行 业 业 内 公 司 或 准 备 进 入 镁 行 业 的 公 司 提 出<br />
了 严 格 的 要 求 , 中 国 镁 业 相 信 其 将 从 中 获<br />
益 。 新 规 对 于 镁 的 生 产 设 计 、 生 产 能 力 和 环<br />
境 保 护 设 定 了 很 高 的 标 准 。<br />
新 规 规 定 :<br />
• 已 有 精 炼 厂 — 年 生 产 能 力 必 须 在 15000 吨<br />
以 上 。 若 已 在 产 的 精 炼 厂 申 请 改 扩 建 ,<br />
则 年 生 产 能 力 需 在 20000 以 上 。<br />
• 新 精 炼 厂 — 设 计 年 生 产 能 力 须 在 50000 吨<br />
以 上 。<br />
除 此 之 外 , 新 的 精 炼 厂 项 目 需 建 设 在 水 源<br />
地 、 基 本 农 田 保 护 区 、 自 然 资 源 、 名 胜 地 和<br />
其 他 需 要 严 格 环 境 保 护 的 地 区 1 公 里 之 外 。<br />
澳 大 利 亚 中 国 镁 业 公 司 董 事 汤 姆 :“ 中 国<br />
生 产 了 世 界 上 80% 的 镁 , 这 其 中 很 大 部 分 产<br />
在 低 产 能 的 小 工 厂 。 中 国 镁 业 引 以 为 豪 的 是<br />
我 们 不 仅 被 批 准 进 行 一 期 扩 建 使 生 产 达 到<br />
20000 吨 , 更 会 将 产 能 提 升 至 105000 吨 。”<br />
“ 新 规 的 出 台 旨 在 使 镁 生 产 行 业 在 更 加 有<br />
效 率 、 更 加 环 保 的 状 态 下 运 行 。 通 过 对 已 有<br />
设 施 的 升 级 和 一 期 扩 建 , 我 们 将 成 为 首 批 符<br />
合 新 规 的 企 业 之 一 , 这 将 稳 固 我 们 在 行 业 中<br />
的 地 位 。”<br />
Further expansion plans at Aohanqi<br />
AFTER achieving daily capacity of 500 tonnes<br />
at the Aohanqi Gold Project’s processing<br />
plant, Sino Prosper State Gold Resources<br />
Holdings has confirmed plans to expand capacity<br />
to 2000 tonnes and is ordering equipment<br />
to achieve this. <strong>The</strong> company will also<br />
construct a new refinery with ultimate annual<br />
output capacity in excess of 1 million ounces<br />
of 99.99% pure gold.<br />
<strong>The</strong> Hong Kong listed company purchased<br />
the operating Aohanqi project in Inner Mongolia,<br />
north of the border with Liaoning<br />
province, in 2009 and has significantly expanded<br />
operations along with undertaking<br />
ongoing exploration.<br />
Sino Prosper aims to become a major Chinese<br />
precious metals producer through acquisition<br />
of producing or near production<br />
properties that can result in increasing resources<br />
and production per share.<br />
Since the Aohanqi acquisition Sino Prosper<br />
has installed new processing plant equipment<br />
and accessory equipment, and has completed<br />
the first phase tailing pond. <strong>The</strong> plant<br />
achieved its daily capacity by the end of December<br />
2010 and has operated with lower<br />
initial feed stock grade than planned while a<br />
new headframe was completed, allowing access<br />
to main ore body.<br />
Sino Prosper has reconstructed tunnels<br />
and supporting facilities taking daily mining<br />
capacity from 200 tonnes to about 600<br />
tonnes. New mine construction, including<br />
four new, larger vertical shafts and connecting<br />
tunnels will bring daily mine output capacity<br />
to about 2500 tonnes on completion by<br />
the end of 2011.<br />
<strong>The</strong> company has made plans for an expanded<br />
drilling program during the Northern<br />
Hemisphere spring and summer to advance<br />
the preparation of JORC resource reporting<br />
and to explore new geologic mineralization.<br />
<strong>The</strong> Aohanqi mining area has also been expanded<br />
from the original 2.07sqkm to<br />
2.70sqkm and the company aims to expand<br />
the licence area to 6sqkm.<br />
Sino Prosper is also developing the<br />
Zhongyi–Weiye Heilongjiang Mine, a production-ready<br />
polymetallic gold property in Heilongjiang<br />
province with five exploration<br />
licensed tenements.<br />
Initial exploration work has focused on developing<br />
resources based on the prevailing<br />
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relevant Chinese standards with an aim to<br />
obtain conversion of the exploration licenses<br />
covering 364.61sqkm to mining permits<br />
as soon as possible. Sino Prosper<br />
expects to convert first exploration licence<br />
to a mining licence within the current year,<br />
with the objective of the earliest possible initial<br />
production.<br />
敖 汉 旗 项 目 扩 建 计 划<br />
在 敖 汉 旗 金 矿 项 目 选 矿 厂 的 日 处 理 矿 石 能<br />
力 达 到 500 吨 后 , 中 盈 国 金 资 源 控 股 有 限<br />
公 司 确 认 其 计 划 将 日 处 理 能 力 提 升 至 2000<br />
吨 并 正 为 此 订 购 设 备 。 公 司 亦 将 会 为 之 配<br />
套 建 设 一 个 年 生 产 100 万 盎 司 99.99% 纯 金<br />
的 精 炼 厂 。<br />
这 个 在 香 港 上 市 的 公 司 于 2009 年 收 购 了 位<br />
于 内 蒙 古 境 内 、 北 与 辽 宁 省 接 壤 的 敖 汉 旗 项<br />
目 , 并 已 在 继 续 勘 探 该 项 目 的 同 时 极 大 地 对<br />
其 进 行 了 扩 容 。<br />
中 盈 希 望 通 过 收 购 在 产 或 即 将 生 产 的 项 目<br />
来 增 加 其 资 源 和 每 股 生 产 能 力 , 目 标 是 成 为<br />
中 国 主 要 的 稀 有 金 属 生 产 者 。<br />
中 盈 在 收 购 敖 汉 旗 项 目 后 , 已 完 成 新 的 选<br />
矿 设 备 及 附 属 设 备 的 安 装 , 并 完 成 了 第 一 阶<br />
段 尾 矿 库 的 建 设 。 该 选 矿 厂 于 2010 年 12 月<br />
底 前 达 到 了 前 述 的 日 处 理 能 力 且 运 行 中 的 初<br />
始 进 料 等 级 低 于 计 划 , 一 个 可 直 达 主 矿 体 的<br />
竖 井 也 在 同 期 建 成 。 中 盈 已 对 隧 道 和 供 应 设<br />
备 进 行 了 改 造 使 日 处 理 矿 石 能 力 从 200 吨 提<br />
升 至 大 约 600 吨 。 在 2011 年 年 底 之 前 , 包 括<br />
4 个 新 的 更 大 的 垂 直 立 井 和 连 接 隧 道 在 内 的<br />
新 设 施 的 建 成 , 将 会 使 日 处 理 矿 石 能 力 提 升<br />
至 大 约 2500 吨 左 右 。<br />
该 公 司 计 划 于 北 半 球 的 春 季 和 夏 季 开 展 更<br />
大 的 钻 探 项 目 以 加 速 JORC 资 源 报 告 的 准 备<br />
并 勘 探 新 的 成 矿 带 。<br />
敖 汉 旗 矿 区 已 由 2.07 平 方 公 里 扩 大 至 2.70<br />
平 方 公 里 , 公 司 的 目 标 是 将 其 扩 大 致 6 平 方<br />
公 里 。<br />
与 此 同 时 , 中 盈 还 在 开 发 黑 龙 江 中 谊 伟 业<br />
项 目 , 该 多 金 属 矿 位 于 黑 龙 江 省 , 中 谊 项 目<br />
现 持 有 5 个 勘 探 权 矿 区 。 前 期 的 勘 探 工 作 的<br />
重 点 是 按 照 中 国 现 行 的 有 关 标 准 进 行 探 矿 ,<br />
目 的 在 于 尽 快 将 364.61 平 方 公 里 的 探 矿 权 转<br />
化 为 开 采 权 。 中 盈 希 望 在 本 年 度 内 将 第 一 个<br />
矿 区 的 探 矿 权 转 化 为 采 矿 权 , 并 希 望 尽 早 得<br />
到 产 出 。<br />
Silvercorp closes BYP acquisition<br />
SILVERCORP Metals has received the necessary<br />
Chinese government approvals, including<br />
military clearance, to acquire 70% of Yunxiang<br />
Mining Co, a private mining company in Hunan<br />
province and whose primary asset is the BYP<br />
Gold-Lead-Zinc mine 220km southwest of<br />
Changsha. BYP has a mining permit covering<br />
3.67sqkm, a safety production permit and<br />
flotation mill with daily capacity of 400 tonnes.<br />
As a result of the acquisition, Yunxiang is converted<br />
into a Sino-Foreign joint venture company<br />
and Silvercorp has taken control.<br />
Total consideration for the 70% interest is<br />
US$33 million. Silvercorp has paid US$19<br />
million, representing 80% of the required payment<br />
for the share purchase, and is required<br />
to make a US$9 million equity capital investment<br />
to Yunxiang. It will make payment of the<br />
remaining 20% after certain conditions, including<br />
completion of a government tax audit<br />
of Yunxiang, are satisfied.<br />
Silvercorp intends to utilize the flotation mill<br />
to mine and process gold starting from the<br />
2012 financial year, initially focusing on higher<br />
grade materials. Concurrently, it plans to expand<br />
daily mining and milling capacity to<br />
1000 tonnes for 2013 and to 2000 tonnes by<br />
2014 with the latter to include 1000 tonnes<br />
of gold mineralization and 1000 tonnes of<br />
lead-zinc mineralization.<br />
A mineralized sample from<br />
Silvercorp Metals’ TLP project.<br />
A 50,000 metre drilling program has been<br />
planned for BYP with the aim of upgrading current<br />
historical resources and expanding the<br />
mineralization bodies along strike and downdip.<br />
A Canadian engineering firm has been engaged<br />
to complete a NI 43-101 report on the<br />
project and a Chinese engineering firm will be<br />
engaged to design a full plan for mining development<br />
and mill construction. Based on internal<br />
analysis, it is possible that the expansion of<br />
the production and exploration drilling will be financed<br />
by cash flow generated by Yunxiang.<br />
Silvercorp is the largest primary silver producer<br />
in China through the operation of four<br />
silver-lead-zinc mines at the Ying Mining Camp<br />
in Henan province. It is building the GC silverlead-zinc<br />
project in Guangdong province as its<br />
second China production base and foothold,<br />
and this will be followed by the third production<br />
foothold at BYP.<br />
For the nine months ended December 31,<br />
2010, the company mined 466,639 tonnes of<br />
ore, a 43% increase from the same period in<br />
2009. Increased production from the TLP,<br />
HPG, and LM mines contributed to the<br />
record mine production.<br />
During the 2012 financial year which started<br />
on April 1, production from the four Ying<br />
Camp mines is expected to increase to<br />
600,000 tonnes of ore at a grade of 325<br />
grams/tonne silver, 0.4 grams/tonne gold,<br />
6% lead and 1.9% zinc, yielding 5.6 million<br />
ounces of silver, 4000 ounces of gold, and 90<br />
million pounds of lead and zinc. In this period<br />
BYP is expected to mine and mill 130,000<br />
tonnes of ore at a grade of 7 grams/tonne<br />
gold, yielding about 26,000 ounces of gold.<br />
Exploration is ongoing at the Ying projects<br />
with underground drilling discovering 18 new<br />
veins at the TLP Mine and 12 new veins at<br />
the LM Mine with numerous high grade pockets<br />
identified.<br />
完 成 对 BYP 金 - 铅 - 锌 矿 的 收 购<br />
希 尔 威 金 属 矿 业 公 司 对 Yunxiang 矿 业 公 司<br />
70% 股 份 的 收 购 已 获 中 国 政 府 相 关 部 门 批<br />
准 。Yunxiang 矿 业 公 司 是 一 家 位 于 湖 南 省 的<br />
私 营 企 业 , 其 主 要 资 产 为 距 长 沙 西 南 220 公<br />
里 的 BYP 金 - 铅 - 锌 矿 。<br />
BYP 拥 有 3.67 平 方 公 里 的 探 矿 权 , 安 全 生<br />
产 许 可 和 一 座 日 处 理 能 力 400 吨 的 浮 选 厂 。<br />
收 购 完 成 后 ,Yunxiang 矿 业 公 司 的 企 业 性 质<br />
变 为 中 外 合 资 , 希 尔 威 公 司 拥 有 控 制 权 。<br />
该 70% 股 权 的 收 购 价 格 为 3300 万 美 元 。 希<br />
尔 威 已 支 付 1900 万 美 元 , 占 收 购 股 份 所 需<br />
支 付 额 的 80%, 并 将 支 付 900 万 美 元 作 为<br />
Yunxiang 矿 业 公 司 股 东 权 益 。 剩 余 的 20% 将<br />
会 在 特 定 事 项 完 成 后 支 付 , 其 中 包 括 政 府 对<br />
Yunxiang 矿 业 公 司 的 税 务 审 计 。<br />
希 尔 威 公 司 计 划 于 2012 财 年 将 浮 选 磨 机 用<br />
于 金 矿 的 开 采 和 遴 选 , 初 期 主 要 用 于 高 品 位<br />
矿 石 。 同 时 , 该 公 司 计 划 在 2013 年 提 高 日<br />
开 采 和 研 磨 能 力 至 1000 吨 , 在 2014 年 提 高<br />
至 2000 吨 , 其 中 处 理 金 矿 石 1000 吨 , 铅 - 锌<br />
矿 石 1000 吨 。<br />
一 个 针 对 BYP 矿 的 50000 米 钻 探 计 划 已 被<br />
制 定 , 目 的 在 于 升 级 历 史 资 源 和 延 成 矿 带 以<br />
及 向 下 拓 展 矿 化 体 。<br />
一 个 来 自 加 拿 大 的 工 程 公 司 将 完 成 NI 43-<br />
101 报 告 , 而 一 个 来 自 中 国 的 工 程 公 司 将 为<br />
采 矿 的 开 发 和 研 磨 的 建 造 设 计 总 体 方 案 。 根<br />
据 内 部 消 息 , 生 产 扩 建 和 钻 探 所 需 的 资 金 将<br />
由 Yunxiang 矿 业 筹 集 。<br />
通 过 在 河 南 省 的 Ying 矿 区 运 营 4 个 银 - 铅 - 锌<br />
矿 , 希 尔 威 成 为 了 中 国 最 大 的 原 生 白 银 生 产<br />
商 。 其 正 在 广 东 省 建 造 GC 银 - 铅 - 锌 项 目 作<br />
为 其 在 中 国 的 第 二 个 生 产 基 地 和 立 足 点 ,<br />
BYP 矿 将 是 第 三 个 。<br />
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2010 年 后 9 个 月 , 该 公 司 共 开 采 466,639 吨<br />
矿 石 , 与 2009 年 同 期 相 比 增 长 43%。 这 些<br />
增 长 主 要 来 自 TLP, HPG, 和 LM 矿 的 增 产 。<br />
4 月 1 日 开 始 的 2012 财 年 ,Ying 矿 区 的 4 个<br />
银 - 铅 - 锌 矿 开 采 的 矿 石 量 预 计 将 增 值 600000<br />
吨 , 其 中 银 325 克 / 吨 , 金 0.4 克 / 吨 ,6% 的<br />
铅 和 1.9% 的 锌 , 将 产 出 560 万 盎 司 的 银 ,<br />
4000 盎 司 的 金 和 9000 万 磅 的 铅 和 锌 。 同 期<br />
BYP 矿 计 划 开 采 和 研 磨 130000 吨 的 矿 石 ,<br />
其 中 金 的 品 位 为 7 克 / 吨 , 将 产 出 26000 盎 司<br />
的 金 。<br />
Ying 矿 区 的 勘 探 工 作 仍 在 进 行 中 , 通 过 地<br />
下 钻 探 , 在 TLP 矿 共 发 现 18 条 新 的 矿 脉 , 在<br />
LM 矿 发 现 12 条 矿 脉 , 以 及 为 数 众 多 的 高 品<br />
位 矿 囊 。<br />
Blackgold acquires WuShan mine<br />
CHINESE coal mining company Blackgold International<br />
Holdings has made its first acquisition<br />
since its February ASX listing with the<br />
purchase of a Chinese coal mine for RMB 80<br />
million (about Aus$12 million). It has entered<br />
into a Heads of Agreement to buy Chongqing<br />
Yihua Mining, owner of the WuShan mine in<br />
Wushan county, Chongqing province in<br />
south-west central China.<br />
<strong>The</strong> acquisition is subject to a satisfactory<br />
due diligence being completed, as well as<br />
being subject to the execution of a final<br />
agreement in accordance with Chinese law<br />
and securing the necessary approvals from<br />
the relevant Chinese authorities.<br />
Blackgold's chairman James Tong says the<br />
WuShan acquisition is in line with the expansion<br />
plans articulated in the company's ASX<br />
prospectus and should have two benefits for<br />
the company.<br />
“WuShan is anticipated to represent nearterm<br />
production that will significantly increase<br />
Blackgold’s annual coal production volume,<br />
and additional exploration and evaluation at<br />
the WuShan mine by a JORC qualified independent<br />
geologist is proposed and is expected<br />
to allow for an increase in Blackgold’s<br />
JORC assessed resources.<br />
WuShan is a highly developed, pre-production<br />
thermal coal mine about 20km from<br />
Blackgold’s existing operations. <strong>The</strong> mine<br />
contains five existing production adits together<br />
with ventilation and access shafts and<br />
ancillary infrastructure including power, piped<br />
water, access roads and buildings.<br />
WuShan is close to river port loading facilities<br />
and has historically supplied small quantities<br />
of thermal coal. Blackgold anticipates<br />
commercial coal production beginning immediately<br />
after machinery and equipment are installed<br />
and commissioned and expects that<br />
this will occur within four months of the acquisition<br />
being finalized.<br />
黑 金 环 球 收 购 巫 山 煤 矿<br />
在 2 月 份 登 陆 澳 大 利 亚 证 券 交 易 所 后 , 中 国<br />
煤 矿 公 司 黑 金 环 球 控 股 以 8000 万 元 人 民 币 (<br />
大 约 1200 万 澳 元 ) 的 价 格 收 购 了 一 个 中 国 的<br />
煤 矿 。 黑 金 环 球 已 缔 结 收 购 重 庆 宜 化 矿 业 有<br />
限 公 司 ( 巫 山 煤 矿 的 所 有 者 ) 股 权 的 协 议 。<br />
巫 山 煤 矿 位 于 中 国 西 南 部 重 庆 市 巫 山 县 。<br />
本 次 收 购 涉 及 已 完 成 的 令 人 满 意 的 尽 职 调<br />
查 , 且 按 照 中 国 的 相 关 法 律 和 有 关 当 局 的 批<br />
文 。 执 行 最 终 协 议 。<br />
黑 金 主 席 唐 志 浩 先 生 表 示 , 收 购 巫 山 煤<br />
矿 , 与 招 股 书 中 说 明 的 扩 展 计 划 一 致 , 将 为<br />
公 司 带 来 两 大 好 处 : 巫 山 煤 矿 若 可 近 期 投<br />
入 生 产 , 将 使 黑 金 的 煤 炭 年 产 量 出 现 显 著 增<br />
长 , 联 合 矿 石 储 量 委 员 会 的 独 立 地 质 学 家 对<br />
巫 山 煤 矿 进 行 额 外 的 勘 探 和 评 估 , 预 计 会 增<br />
加 黑 金 符 合 评 估 标 准 的 资 源 。<br />
巫 山 煤 矿 是 一 家 发 展 动 力 煤 前 期 作 业 的 煤 矿<br />
, 距 离 黑 金 目 前 的 两 个 煤 矿 20 公 里 内 。 煤<br />
矿 包 含 5 个 生 产 入 口 , 连 同 其 风 井 和 竖 井 通<br />
道 , 和 所 有 辅 助 性 基 础 设 施 , 如 : 电 力 , 自<br />
来 水 , 通 路 和 相 关 建 筑 都 已 建 好 。<br />
巫 山 煤 矿 距 离 货 运 码 头 很 近 , 该 码 头 之 前 曾<br />
装 载 运 输 过 少 量 的 热 煤 。 一 旦 安 装 , 调 试 好<br />
机 器 设 备 , 就 可 立 即 作 业 , 投 入 生 产 。 巫 山<br />
煤 矿 将 在 收 购 完 成 后 4 个 月 内 投 入 生 产 。<br />
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Philippines<br />
ALLIANCE PLANS COUNTRY’S SECOND NICKEL PLANT<br />
THE alliance between Sumitomo Metal Mining<br />
and Nickel Asia Corp will spend US$1.4<br />
billion to build a second nickel processing<br />
plant in the province of Surigao del Norte.<br />
Sumitomo will have about a 55% stake in the<br />
project and Nickel Asia about 22.5% with the<br />
rest of the shares divided under a joint venture<br />
company called THPAL Corp.<br />
Nickel Asia’s president and CEO Gerard<br />
Brimo says construction of the country’s second<br />
downstream nickel processing plant will<br />
start this year and take two years to complete.<br />
“We expect to finish the project in the<br />
middle of 2013.”<br />
<strong>The</strong> plant will be constructed adjacent to the<br />
nickel mine of Nickel Asia subsidiary Taganito<br />
Mining Corp, which will supply the plant's required<br />
nickel ore over an estimated 30-year<br />
period. Sumitomo will purchase the output of<br />
the plant, a mixed nickel-cobalt sulphide, for<br />
final processing at its refinery in Japan.<br />
<strong>The</strong> Taganito plant will use high-pressure<br />
acid leach (HPAL) technology, which employs<br />
low-grade laterite ores, which previously were<br />
usually abandoned, to produce nickel.<br />
Sumitomo, which is Japan’s top nickel producer,<br />
also intends to spend US$168 million<br />
to beef up capacity at a Japanese nickel refinery<br />
to handle raw metal produced at the<br />
Taganito project. It plans to increase annual<br />
refining capacity at its Niihama plant to<br />
65,000 tonnes in the 2013/14 financial year<br />
from the current 41,000 tonnes. <strong>The</strong> expansion<br />
work is expected to be completed in the<br />
first quarter of 2013.<br />
<strong>The</strong> new Taganito processing plant is also<br />
considered particularly beneficial to the Philippines<br />
because of the value-added created by<br />
the downstream mineral processing plant, including<br />
14,000 jobs and an increase in the<br />
country's foreign exchange reserves.<br />
Gerard Brimo says the new plant will have a<br />
capacity more than three times that of the first<br />
plant under Coral Bay Nickel Corp, a joint venture<br />
between a Japanese consortium led by<br />
Sumitomo and Rio Tuba Nickel Mining Corp,<br />
which is another Nickel Asia subsidiary.<br />
Constructed adjacent to the operations of<br />
Rio Tuba in southern Palawan, the first plant<br />
became operational in 2005 and has been a<br />
technical and commercial success. Its initial annual<br />
capacity of 10,000 tonnes of nickel metal<br />
equivalent has since been more than doubled.<br />
Sumitomo has recently introduced new equipment<br />
at the Coral Bay HPAL plant, upgrading<br />
annual capacity by 10% to 24,000 tonnes.<br />
New drilling program at Alpha<br />
MBMI Resources has started an 8000 metre<br />
drill program on the Alpha Nickel Project in<br />
Palawan focusing on detailed mine planning<br />
as well as exploration beyond the limits of the<br />
60 hectare area previously permitted.<br />
<strong>The</strong> drilling contractor's 11 tungsten-carbide<br />
core drill rigs and associated equipment<br />
arrived at the Alpha project site at the end of<br />
March, were mobilized to target areas and<br />
began drilling on the property on April 9.<br />
<strong>The</strong> 8000 metre drill program is the first<br />
phase of a much larger program. Past exploration<br />
activities have identified accessible highgrade,<br />
exposed nickel and chrome materials<br />
zones within the 3200 hectare property.<br />
<strong>The</strong> majority of the drilling will focus on<br />
grade control to identify and confirm detailed<br />
data required to expand and define high priority<br />
areas for continued mining. <strong>The</strong> grade<br />
control holes will be completed to a maximum<br />
depth of 15 metres and drilled on a 15<br />
metre by 15 metre spacing.<br />
<strong>The</strong> remainder of the program will consist<br />
of exploration holes drilled to a maximum<br />
depth of 25 metres on a 50 metre by 50<br />
metre spacing focused in an area where<br />
mapping and test pitting have shown highly<br />
prospective results. <strong>The</strong>se exploration holes<br />
will be outside the boundary of the 60 hectare<br />
area previously explored and will expand currently<br />
delineated areas to confirm sufficient resources<br />
for future development operations.<br />
MBMI’s president and director Michael<br />
Mason says, “This first phase of drilling is designed<br />
as an intensive and systematic exploration<br />
program to develop and confirm results<br />
to expand the independent mineral resource<br />
on Alpha. In addition, the grade control drilling<br />
will provide the company and our partners<br />
with the required data to continue mining and<br />
development of this project.”<br />
MBMI is focused on the exploration and development<br />
of nickel properties and with its<br />
Philippine partners maintains a Financial or<br />
Technical Assistance Agreement (FTAA) with<br />
the Philippine government with respect to the<br />
Alpha, Bethlehem and Rio Tuba properties.<br />
<strong>The</strong> FTAA allows MBMI and its partners to<br />
progress toward development of full-scale<br />
operational programs at each property.<br />
A stockpile of ore at MBMI’s Alpha Nickel Project in Palawan.<br />
54 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Philippines<br />
<strong>The</strong> Agsao shaft at Medusa’s Co-O Gold Project on Mindanao.<br />
<strong>The</strong> company is using funds raised in recent<br />
private placements and financing arrangements<br />
to accelerate exploration at Alpha and<br />
Bethlehem. A $3.8 million placement in March<br />
which increased Gwynneth Gold’s stake in<br />
MBMI to 12.7%, a $5.8 million private placement<br />
in February and the securing of a $7 million<br />
pre-advance payment in late November<br />
have boosted the company’s finances.<br />
Exceptional Co-O gold assays<br />
EXCEPTIONAL assay results are being obtained<br />
by Medusa Mining from a new wide,<br />
sub-vertical, high grade zone within the mine at<br />
the Co-O Gold Project. <strong>The</strong> underground drilling<br />
has returned 13.10 metres @ 47.81 grams/<br />
tonne gold, 9.65 metres @ 12.58 grams/tonne<br />
and 4.8 metres @ 13.84 grams/tonne.<br />
Surface drilling in and around the mine has<br />
also provided strong results including 2 metres<br />
@ 219.17 grams/tonne, 0.8 metres @ 42.33<br />
grams/tonne, 1 metre @ 31.45 grams/tonne<br />
and 1.15 metres @ 12.49 grams/tonne.<br />
A recent assessment of the Co-O Mine vein<br />
architecture by independent structural geology<br />
consultants described strong similarities of the<br />
vein system structure and aerial extent to the<br />
Martha Mine epithermal vein system in New<br />
Zealand which produced about 5.6 million<br />
ounces of gold from the 1870s to 1952 and<br />
was mined to around 600 metres in depth.<br />
Medusa’s managing director Geoff Davis<br />
says, “<strong>The</strong> continuing good results from the<br />
Co-O vein system and surrounds are extremely<br />
pleasing, including the discovery of a<br />
new exceptionally wide and high grade zone<br />
within the mine by underground drilling.<br />
“I also wish to emphasise that, as we drill new<br />
vein systems, drill intersections in veins rarely<br />
provide ore-grade intersections in every hole.<br />
As our data base grows, and the characteristics<br />
of each vein become clearer, statistical assessment<br />
of the percentage of ore-grade drill<br />
hole intersections required, maybe as low as<br />
40% of holes with ore grade intersections, will<br />
increasingly provide the levels of certainty for<br />
turning exploration drill results into ore that can<br />
be developed with confidence.”<br />
Medusa is confident that the ongoing exploration<br />
can provide additional ore for the Co-O<br />
processing plant, thus increasing the mine life.<br />
<strong>The</strong> revised forecast gold production for the<br />
fiscal year to June 30, 2011, is now a record<br />
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Philippines<br />
102,000 ounces at anticipated cash costs of<br />
US$190 per ounce. Geoff Davis says, “I am<br />
pleased to report that operations have continued<br />
smoothly with the company achieving<br />
record production at the low average cash<br />
cost of US$186 per ounce for the first six<br />
months of the financial year.”<br />
Mine development is continuing with the<br />
sinking of the Saga Shaft under way and the<br />
start of a new adit to access the Royal Veins<br />
and the newly discovered North Tinago vein<br />
systems. Late last year the company’s Board,<br />
approved construction of a new Co-O plant<br />
with capacity to annually produce 200,000.<br />
Capital requirements of the plant, including<br />
mine development, are estimated at US$80<br />
million and will be funded out of cashflow. <strong>The</strong><br />
preliminary construction schedule after regulatory<br />
permitting is estimated to be 21 months.<br />
Medusa is currently advancing the permitting<br />
process and is engaged in discussions with<br />
engineering design and construction groups.<br />
Royalco attracts new investor<br />
MICROCAP investment manager Acorn Capital<br />
has taken a 19% stake in Australia-based<br />
Philippine explorer Royalco Resources. <strong>The</strong><br />
change occurred earlier in the year after South<br />
Australian focused copper and gold miner OZ<br />
<strong>Miner</strong>als offloaded its 18.97% stake in Royalco.<br />
Apart from its Philippines exploration interests,<br />
Royalco holds a portfolio of 10 royalty interests<br />
in mines around the world of which two<br />
have been producing income in recent times.<br />
Royalco is currently deriving most of its income<br />
from a royalty on the Globe-Progress<br />
gold mine at Reefton in New Zealand. It is<br />
also considering other project opportunities<br />
in South East Asia, including Cambodia.<br />
During the December quarter the royalty<br />
payment from Globe-Progress was 1250<br />
ounces of gold which equates to about<br />
Aus$5.9 million on an annual basis for this net<br />
royalty income. <strong>The</strong> company expects the<br />
number of producing royalties to increase to<br />
four in coming months.<br />
Acorn Capital is now Royalco’s second<br />
largest shareholder, behind Anglo Pacific<br />
Group which holds a 31.1% stake.<br />
Royalco’s executive chairman Peter Topham<br />
says OZ <strong>Miner</strong>als has been a supporter in recent<br />
years and that ‘corporate paths’ may<br />
cross in future in the “same professional manner<br />
in which it has in the past”. He says, “This<br />
transaction will also potentially benefit shareholders,<br />
as it should assist in adding greater<br />
liquidity to trading in our shares on the Australian<br />
Securities Exchange.”<br />
Royalco has executed an option agreement<br />
with Vale International over its Gambang tenement<br />
in northern Luzon and is also seeking<br />
interest for its Pao Yabbe project which adjoins<br />
OceanaGold’s Didipio Copper-Gold<br />
Project, also in northern Luzon.<br />
Rain delays Siana progress<br />
HEAVY rain in northern Mindanao has delayed<br />
construction progress at Red 5’s Siana<br />
Gold Project. Rainfall in the Siana area for the<br />
first 12 weeks of 2011 totalled 3.5 metres,<br />
which was 203% above average.<br />
<strong>The</strong> rain postponed the major crusher and<br />
SAG mill concrete pours, putting the work<br />
eight weeks behind schedule. <strong>The</strong> company<br />
will forecast a revised inaugural gold pour<br />
date once the major concrete pours have<br />
been completed, cured and certified. <strong>The</strong> targeted<br />
date had been early May.<br />
<strong>The</strong> rain has been so heavy at times that pit<br />
dewatering was temporarily suspended on<br />
several occasions due to the large volume<br />
and velocity of water in the adjacent river systems.<br />
<strong>The</strong> mining pre-strip has been progressing,<br />
although the rain postponed<br />
activities in areas requiring narrower working<br />
widths due to safety reasons.<br />
It also caused a temporary suspension of<br />
drilling at the Mapawa site for safety reasons<br />
due to mudslides and the inability to maintain<br />
a continuous supply of consumables to the<br />
three rigs. Analytical results have, however<br />
been received for a number of holes and include<br />
37 metres @ 3.0 grams/tonne gold.<br />
<strong>The</strong> company has advanced the Siana project<br />
where possible during this period. Grid<br />
power has been connected and reticulated<br />
on site while concrete foundations for all six<br />
CIL tanks and the cyanide detox plant have<br />
been completed.<br />
Formwork and rebar for the crusher and SAG<br />
mill are complete, all major equipment items<br />
such the SAG mill, rolls crusher, apron feeder<br />
and cyclone nest as have been manufactured<br />
and are awaiting delivery to the site, all offsite<br />
steelworks and plateworks are on schedule,<br />
the electrical and pipe work packages have<br />
been released, and 75% of the capital cost is<br />
now under firm orders/contracts.<br />
Red 5 has agreed to a US$8 million<br />
standby credit facility with Sprott Resource<br />
Lending Partnership, which replaces the previously<br />
announce US$25 million gold prepay<br />
with Sprott Group. <strong>The</strong> facility is for 24<br />
months and amounts drawn may be repaid<br />
early with no penalty.<br />
<strong>The</strong> Siana mine build, together with working<br />
capital requirements and exploration programs,<br />
is fully funded to production status,<br />
however, the company’s Board believed it<br />
prudent to guarantee access to additional<br />
funding in light of the continued heavy rains<br />
and due to recent global events.<br />
Existing treasury funds total Aus$67.7 million<br />
with a further Aus$51.4 million forecast<br />
to be invoiced on the Siana build which would<br />
bring the capital cost to first gold pour to<br />
US$78.2 million.<br />
<strong>The</strong> layout of Red 5’s Siana Gold Project in northern Mindanao.<br />
56 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Philippines<br />
Masbate continues to set records<br />
GOLD production and throughout continue<br />
to increase at CGA Mining’s flagship Masbate<br />
Gold Project, which is now the largest operating<br />
gold project in the Philippines. CGA is<br />
also well along the path to expanding production<br />
at the project and is acquiring additional<br />
interests throughout the country.<br />
During the December quarter production increased<br />
4% on the previous quarter to 50,330<br />
ounces while mill throughput rose 7% to 1.5<br />
million tonnes of ore. It was the seventh consecutive<br />
quarter of increased gold production.<br />
In the first year of operations, the project produced<br />
in excess of 150,000 ounces of gold.<br />
Masbate is currently forecast to produce<br />
200,000 gold ounces each year and has a<br />
probable reserve of 3.03 million gold ounces.<br />
<strong>The</strong> company is focused on completing the<br />
plant investment program of US$15 million<br />
designed to upsize the existing plant and lock<br />
in a sustainable annual throughput level of 6.5<br />
million tonnes. In line with this expansion CGA<br />
has placed orders for a supplementary crushing<br />
circuit handling 400 tonnes each hour.<br />
This is designed to ensure the 6.5 million<br />
<strong>The</strong> processing plant at CGA Mining’s Masbate<br />
Gold Project on Masbate Island.<br />
tonne throughputs are achieved when the ore<br />
blend becomes harder. Initial construction for<br />
the upgrade has begun.<br />
CGA is also committed to a US$10 million<br />
exploration program this year with a focus on<br />
materially enhancing the reserve and resource<br />
base of Masbate.<br />
In April 2010, CGA’s Philippine subsidiary<br />
Filminera was granted a 52sqkm exploration<br />
permit adjacent to the project, which covers<br />
a number of known and previously mined<br />
gold deposits as<br />
well as hosting a<br />
significant geophysical<br />
anomaly<br />
with a signature<br />
similar to Masbate’s<br />
Main Vein<br />
deposit. <strong>The</strong> permit<br />
has not benefited<br />
from modern<br />
or systematic exploration<br />
and is considered<br />
highly prospective with potential to<br />
materially increase resources.<br />
<strong>The</strong> 2011 exploration program is initially focused<br />
on three broad target areas - near mine<br />
infill drilling to upgrade inferred material to indicated<br />
status; near mine step out drilling to<br />
extend the ore model beneath and along<br />
strike of current information; and exploration<br />
of the new tenement in areas of known mineralization<br />
and those previously unexplored.<br />
It follows the most recent drilling campaign<br />
comprising 9401 metres of reverse circulation<br />
drilling and 2383 metres of diamond core<br />
drilling. Significant intersections include 4 metres<br />
at 8.99 grams/<br />
tonne gold, 6 metres<br />
@ 3.37 grams/<br />
tonne; 9 metres @<br />
3.41 grams/tonne<br />
and 3 metres at<br />
9.63 grams/tonne.<br />
In line with its<br />
strategic alliance<br />
with Ratel Group,<br />
CGA will also continue<br />
to work with<br />
the company to assist in progressing and<br />
enhancing the value of the King-king Gold<br />
Project on Mindanao.<br />
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Australia<br />
SWEET RESULTS FROM BAUXITE DRILLING AT BINJOUR<br />
DRILLING by Australian Bauxite Ltd at the<br />
Binjour project in central Queensland has<br />
returned exceptionally high quality intercepts<br />
of bauxite suitable for sweetening circuits<br />
in refineries. Eleven of 14 holes drilled<br />
intersected very high quality thick bauxite,<br />
significantly advancing the company’s exploration<br />
knowledge.<br />
<strong>The</strong> results at Binjour, which is between<br />
Australian Bauxite’s extensive tenements are in eastern Australia.<br />
the towns of Gayndah and Mundubbera,<br />
south of the port of Gladstone, suggest relatively<br />
pure gibbsite bauxite.<br />
Australian Bauxite’s CEO Ian Levy says,<br />
“Binjour may prove to be a very high quality<br />
bauxite deposit, shippable in large tonnages<br />
to a number of bauxite/alumina refineries that<br />
need ‘sweetener-grade’ bauxite that can be<br />
processed at low temperature and with exceptionally<br />
low reactive silica contents.<br />
“We’ve called this bauxite type ‘Brown<br />
Sugar’ bauxite – which may become a<br />
brand name in the industry one day. Some<br />
customers may become dependent on this<br />
product and pay quite handsomely for it.”<br />
<strong>The</strong> company will target its 2011 drilling<br />
program at areas where the bauxite layer is<br />
at the surface.<br />
At the Taralga prospect in the Southern<br />
Highlands of New South Wales, bauxite resources<br />
totalling 12 million tonnes were<br />
identified in late 2010 from first pass drilling.<br />
More than half of the resources are easily<br />
mine direct shipping ore (DSO) grade bauxite<br />
suitable for direct shipping to customers<br />
requiring gibbsite-rich bauxite, which is the<br />
premium quality bauxite that is in highest<br />
demand globally.<br />
<strong>The</strong> bulk of these resources came from two<br />
areas in the central north of the Taralga tenement<br />
but a new bauxite deposit has been discovered<br />
in the southeast of the tenement and<br />
this is now being drilled as a matter of priority.<br />
During the January drilling cycle 225 holes<br />
were drilled in this area and some zones of<br />
exceptionally thick bauxite layers were discovered,<br />
including one hole that intersected<br />
bauxite from surface to 18 metres depth.<br />
This deposit extends westwards from the<br />
original exploration licence into a newly<br />
granted licence area where 20 of the 225<br />
holes were drilled within 14 days of it being<br />
granted. <strong>The</strong> new deposit appears significantly<br />
larger than the other two deposits,<br />
both in thickness and areal extent.<br />
Australian Bauxite has also been drilling on<br />
its Tasmanian tenement on grazing and cropping<br />
farmland around Campbell Town in the<br />
state’s midlands. Bauxite has been encountered<br />
in drill holes and in surface sampling.<br />
Results to date are from the edges of the<br />
deposit and from some outlier occurrences<br />
of bauxite and they demonstrate that DSO<br />
grades occur in reasonable thicknesses. An<br />
application for a further tenement in Tasmania<br />
has also been lodged.<br />
<strong>The</strong> company holds the core of the newly<br />
discovered eastern Australia bauxite<br />
province with 32 different tenements in<br />
Queensland, New South Wales and Tasmania<br />
covering 7537sqkm.<br />
58 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Australia<br />
MOU for Mt Peake project<br />
TNG Limited has signed a Memorandum of Understanding<br />
with a Chinese state-owned engineering,<br />
development and construction<br />
company to establish a strategic partnership for<br />
financing and development of the Mount Peake<br />
Iron-Vanadium Project in the Northern Territory.<br />
<strong>The</strong> MOU allows for potential future agreement<br />
to undertake engineering, procurement<br />
and construction works and securing<br />
project finance, subject to entering into definitive<br />
agreements. <strong>The</strong> MOU is conditional<br />
on successful evaluation of the recent<br />
Mount Peake scoping study.<br />
<strong>The</strong> non-binding MOU follows a recent positive<br />
independent study based on TNG’s revolutionary<br />
new patented hydrometallurgical<br />
process. This was developed by TNG in conjunction<br />
with its metallurgical consultants <strong>Miner</strong>als<br />
Engineering Technical Services (METS)<br />
and has been successful in recovering three<br />
principal commodities – vanadium, titanium<br />
and iron – from samples of Mount Peake ore.<br />
<strong>The</strong> Chinese group, which has requested<br />
anonymity as part of the MOU, is reviewing<br />
the study and other project information, and<br />
subject to a satisfactory review, the two parties<br />
will sign potential agreements regarding<br />
off-take of the iron and vanadium products,<br />
project construction and funding.<br />
<strong>The</strong> study outlines a mine life of more than<br />
23 years with life-of-mine production of<br />
107.1 million tonnes for total metal production<br />
of 349,000 tonnes of vanadium, 27.182<br />
million tonnes of iron and 6.463 million<br />
tonnes of titanium.<br />
TNG has appointed engineering firm Sinclair<br />
Knight Mertz (SKM) to manage completion<br />
of a pre-feasibility study (PFS) which will<br />
build on the scoping study. <strong>The</strong> PFS is expected<br />
to take seven months and will be<br />
based on a conventional open pit mining operation<br />
annually processing 5 million tonnes.<br />
It will be carried out in conjunction with the<br />
next phase of pilot plant metallurgical test<br />
work, which is testing commercialization of<br />
the patented metallurgical process.<br />
<strong>The</strong> PFS will pave the way for a definitive feasibility<br />
study next year on potential commercial<br />
development options for the project as the<br />
foundation for a long-life, world-scale ferrous<br />
metal business in the Northern Territory.<br />
TNG’s chief executive Paul Burton says the<br />
company is building a highly capable team to<br />
progress the project. “As part of this team we<br />
are pleased to have secured the services of<br />
SKM and will retain the services of Snowden for<br />
resource evaluation and mining advice, as well<br />
as joint patent owners METS for continued metallurgical<br />
evaluation and process development.”<br />
He says TNG recently completed a $2.8<br />
million capital raising to underpin completion<br />
of the PFS, including delivery of a resource<br />
upgrade, pilot plant metallurgical<br />
work and associated studies on the hydrometallurgical<br />
process.<br />
Peake 山 项 目 谅 解 备 忘 录<br />
TNG 有 限 公 司 与 一 家 中 国 国 有 工 程 、 开 发 和<br />
建 设 公 司 签 署 了 一 份 谅 解 备 忘 录 , 就 合 作 融<br />
资 并 开 发 北 领 地 Peake 山 铁 钒 项 目 建 立 起 战<br />
略 伙 伴 关 系 。<br />
该 谅 解 备 忘 录 为 今 后 的 项 目 设 计 、 采 购 、<br />
施 工 合 同 以 及 项 目 融 资 留 有 了 空 间 , 但 须 取<br />
决 于 签 订 确 定 性 协 议 。 该 谅 解 备 忘 录 是 有 条<br />
件 的 , 即 需 成 功 进 行 对 Peake 山 概 略 研 究 的<br />
评 价 。<br />
这 份 不 具 约 束 力 的 谅 解 备 忘 录 是 在 针 对<br />
TNG 公 司 一 项 革 命 性 的 湿 法 冶 金 工 艺 新 专 利<br />
做 出 独 立 积 极 研 究 后 签 署 的 。 这 项 专 利 由<br />
TNG 公 司 与 其 冶 金 顾 问 矿 物 工 程 技 术 服 务 公<br />
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Australia<br />
司 (METs) 合 作 开 发 的 , 并 已 在 从 Peake 山<br />
矿 样 中 提 取 三 种 主 要 金 属 时 取 得 成 功 ——<br />
钒 、 钛 和 铁 。<br />
中 方 合 作 伙 伴 要 求 在 该 谅 解 备 忘 录 中 匿 名<br />
出 现 , 正 在 审 查 项 目 概 略 研 究 以 及 其 他 信 息<br />
, 若 审 查 结 果 令 人 满 意 , 双 方 将 签 署 有 关 铁<br />
和 钒 产 品 的 包 销 、 项 目 建 设 以 及 融 资 合 同 。<br />
项 目 概 略 研 究 预 计 矿 山 寿 命 超 过 23 年 , 共<br />
计 矿 石 产 量 将 达 1.071 亿 吨 , 包 括 34.9 万 吨<br />
钒 ,2718.2 万 吨 铁 和 646.3 万 吨 钛 。<br />
TNG 公 司 已 委 任 工 程 公 司 Sinclair Knight<br />
Mertz (SKM) 负 责 在 概 略 研 究 基 础 上 完 成 预<br />
可 行 性 研 究 报 告 (PFS)。 预 计 需 要 7 个 月<br />
时 间 , 假 设 前 提 是 传 统 的 露 天 开 采 , 年 处 理<br />
量 500 万 吨 。 这 项 工 作 将 与 下 阶 段 的 中 试 厂<br />
冶 金 试 验 工 作 同 时 进 行 , 主 要 是 验 证 专 利 冶<br />
金 工 艺 的 商 业 化 运 作 。<br />
该 可 行 性 研 究 将 为 明 年 的 最 终 可 行 性 铺 平<br />
道 路 , 着 眼 于 可 能 采 取 的 商 业 化 项 目 开 发 方<br />
案 , 目 标 是 使 项 目 成 为 北 领 地 地 区 一 个 世 界<br />
级 的 长 寿 命 黑 色 金 属 项 目 。<br />
TNG 公 司 的 首 席 行 政 官 Paul Burton 说 , 该<br />
公 司 正 在 建 立 一 个 精 干 的 团 队 推 进 项 目 进<br />
展 。“ 作 为 这 个 团 队 的 一 部 分 , 我 们 很 高 兴<br />
已 经 获 得 了 来 自 SKM 的 服 务 , 并 会 聘 请<br />
Snowden 公 司 进 行 资 源 评 价 和 开 采 建 议 , 以<br />
及 专 利 的 共 同 拥 有 者 METs 公 司 继 续 进 行 冶<br />
金 学 评 估 和 工 艺 研 发 。”<br />
他 还 介 绍 说 TNG 公 司 最 近 完 成 了 一 项 280 万<br />
澳 元 的 资 金 募 集 , 以 此 为 预 可 行 性 研 究 提 供<br />
资 金 支 持 , 包 括 资 源 升 级 , 中 试 冶 金 试 验 工<br />
作 以 及 其 他 针 对 湿 法 冶 金 工 艺 的 相 关 研 究 。<br />
Chinese uranium investment<br />
UNITED Uranium has signed a joint venture<br />
agreement with a Chinese company to advance<br />
a number of its uranium tenements in<br />
the Northern Territory. United has also received<br />
Aus$1.176 million from a placement<br />
to the Chinese investor.<br />
<strong>The</strong> No 1 Institute of Geology and <strong>Miner</strong>als<br />
of Shandong Province (SDGM) has received<br />
formal approval from Australia’s Foreign Investment<br />
Review Board (FIRB) to subscribe for 5.6<br />
million shares in United Uranium. FIRB has also<br />
provided formal approval for SDGM to acquire<br />
up to 51% of the issued capital of United and<br />
up to a 50% interest in six tenements.<br />
<strong>The</strong> Chinese company can earn the 50%<br />
interest by spending a total of $3 million on<br />
exploration. United Uranium will work with<br />
SDGM to further advance the tenements,<br />
which include McArthur River, Pine Creek,<br />
Dunmarra and Wiso. Drilling programs are<br />
already planned at two of the tenements<br />
with the SDGM funds and joint venture<br />
agreement enabling further work to be carried<br />
out into the future.<br />
Owing to adverse weather United had to<br />
postpone its initial drilling program at<br />
McArthur River until after the wet season. <strong>The</strong><br />
program is now due to take place during the<br />
current quarter subject to drill rig availability.<br />
<strong>The</strong> drilling program was planned after<br />
ground-based electrical geophysics was<br />
completed over the T1 target of this tenement<br />
where induced polarization (IP) surveys identified<br />
a strongly chargeable and moderately<br />
conductive response. <strong>The</strong> target zone is<br />
about 100 metres below surface, has a thickness<br />
of up to 30 metres and is at least 300<br />
metres long by 300 metres wide.<br />
At Pine Creek all necessary drilling approvals<br />
have been received for programs at<br />
Stray Creek West and Stray Creek targets<br />
and it is expected that the drilling will also<br />
take place this quarter, subject to rig availability.<br />
IP surveys have also been completed.<br />
<strong>The</strong> Pine Creek Geosyncline is a major gold<br />
and uranium province in the Northern Territory<br />
which also contains many mine copper, leadzinc<br />
and tin mineral occurrences.<br />
Meanwhile, United continues to work with<br />
the Central Land Council in getting another<br />
two of the six tenements granted and is also<br />
continuing in its search for new projects with<br />
the focus remaining on uranium. It will, however,<br />
also consider other commodities.<br />
中 国 铀 矿 投 资<br />
联 合 铀 业 公 司 (UNITED Uranium) 与 一<br />
家 中 国 公 司 签 署 了 合 资 协 议 , 以 推 进 位<br />
于 北 领 地 的 几 个 铀 矿 项 目 开 发 。 联 合 铀<br />
业 公 司 还 收 到 了 通 过 向 中 方 投 资 者 增 发<br />
股 份 募 得 的 117.6 万 澳 元 资 金 。<br />
山 东 省 第 一 地 质 矿 产 研 究 院 (<br />
SDGM) 已 收 到 澳 大 利 亚 外 国 投 资 审<br />
查 委 员 会 (FIRB) 的 正 式 批 准 , 同 意<br />
其 认 购 联 合 铀 业 公 司 560 万 股 股 份 。<br />
澳 大 利 亚 外 国 投 资 审 查 委 员 会 还 为 山<br />
东 省 第 一 地 质 矿 产 研 究 院 提 供 正 式 文<br />
件 , 批 准 其 最 多 可 收 购 联 合 铀 业 公 司<br />
发 行 股 本 的 51%, 并 在 六 个 矿 权 中 占<br />
最 高 50% 的 权 益 。<br />
中 方 公 司 可 通 过 投 资 300 万 澳 元 用<br />
于 勘 探 从 而 获 得 项 目 的 50% 权 益 。<br />
联 合 铀 业 公 司 将 与 山 东 省 第 一 地 质<br />
矿 产 研 究 院 合 作 以 进 一 步 推 进 这 几 个<br />
矿 权 区 的 开 发 , 包 括 McArthur River,<br />
Pine Creek,Dunmarra 和 Wiso。 已 为<br />
其 中 两 个 矿 权 区 制 定 了 钻 探 计 划 , 并<br />
将 利 用 山 东 省 第 一 地 质 矿 产 研 究 院 提<br />
供 的 资 金 , 且 合 资 协 议 使 今 后 进 一 步<br />
工 作 成 为 可 能 。<br />
由 于 恶 劣 天 气 联 合 铀 业 公 司 不 得<br />
不 将 McArthur 的 初 步 钻 探 计 划 推 迟 到 雨 季 之<br />
后 。 现 在 该 计 划 应 定 于 本 季 度 内 实 施 , 取 决<br />
于 是 否 能 调 到 钻 机 。<br />
钻 探 方 案 是 基 于 对 这 一 矿 权 中 T1 号 靶 区 的<br />
地 表 电 学 地 球 物 理 研 究 后 制 定 的 , 在 此 通 过<br />
激 发 极 化 研 究 (IP) 发 现 了 强 烈 的 可 充 电 性<br />
和 适 度 导 电 性 。 目 标 区 域 位 于 地 表 以 下 约<br />
100 米 , 厚 度 高 达 30 米 , 至 少 300 米 长 ,300<br />
米 宽 。<br />
Pine Creek 矿 权 区 的 Creek West 和 Stray<br />
Creek 靶 区 已 收 到 所 有 必 需 的 钻 探 方 案 批<br />
准 , 预 计 也 将 在 这 个 季 度 执 行 , 取 决 于 是<br />
否 能 获 得 钻 机 。 这 些 靶 区 的 激 发 极 化 研<br />
究 (IP) 也 已 完 成 。<br />
Pine Creek 向 斜 地 带 是 北 领 地 地 区 一 个 知<br />
名 的 黄 金 和 铀 产 区 , 还 蕴 藏 着 许 多 铜 , 铅 -<br />
锌 , 锡 等 矿 化 露 头 。<br />
与 此 同 时 , 联 合 铀 业 将 继 续 与 中 部 土 地 理<br />
事 会 (Central Land Council) 合 作 以 取 得 另<br />
外 六 个 矿 权 区 中 两 个 的 批 准 , 还 将 继 续 寻 找<br />
新 项 目 , 重 点 仍 将 是 铀 。 不 过 也 考 虑 其 他 矿<br />
种 。<br />
Copper Strike secures Chinese funds<br />
COPPER Strike will use almost $11.5 million<br />
it aims to raise in placement and option<br />
agreements with Chinese companies to advance<br />
the development of the Einasleigh Project<br />
in North Queensland, where two<br />
copper-gold-silver deposits and four zinclead-silver<br />
deposits have been discovered.<br />
United Uranium’s tenements are in Australia’s Northern Territory.<br />
60 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
News 3_<strong>Layout</strong> 1 4/21/11 2:45 PM Page 61<br />
Australia<br />
Copper Strike has signed agreements with<br />
Beijing Jintai Yuanchung Mining Co and<br />
Taifeng Yuangcheng International Development<br />
Limited to raise Aus$5.822 million<br />
through a share placement and a further<br />
Aus$5.64 million through an option placement.<br />
<strong>The</strong> agreements are conditional upon<br />
final confirmatory due diligence, shareholder<br />
approval, Foreign Investment Review Board<br />
approval and Chinese government approvals.<br />
Jintai is a joint venture between Sichuan<br />
Taifeng Group Co and Sichuan Bureau of<br />
Metallurgical Geology and Exploration<br />
(SBMGE) while Taifeng is a wholly-owned<br />
subsidiary of Sichuan Taifeng Group.<br />
<strong>The</strong> initial placement will see the Chinese<br />
companies obtain a 19.99% interest in Copper<br />
Strike while the options will result in a further<br />
13.01% interest, with the options<br />
exercisable within three years of issue. Copper<br />
Strike has also signed a joint venture development<br />
agreement with Taifeng.<br />
<strong>The</strong> initial $5.822 funding will be used to finalize<br />
a bankable feasibility study (BFS) with<br />
respect to the Kaiser Bill, Einasleigh, Chloe,<br />
Jackson and Stella deposits within the<br />
Einasleigh project.<br />
Under the JV development agreement, if<br />
the BFS confirms the currently estimated recoverable<br />
resource, production costs and development<br />
costs for these deposits, an<br />
unincorporated joint venture will be established<br />
between Taifeng and Copper Strike’s<br />
subsidiary, Einasleigh Mining.<br />
Taifeng will subsequently provide a further<br />
$95 million by way of a farm-in for a 70% interest<br />
in the tenements and will provide a further<br />
$5 million loan to Copper Strike, which<br />
will make available to the development funding,<br />
as necessary, the proceeds of the loan<br />
and proceeds received from the exercise of<br />
the options. Taifeng and Einasleigh Mining<br />
have also entered into an offtake term sheet<br />
providing Taifeng with the right of first refusal<br />
to purchase Copper Strike’s 30% of the offtake<br />
under the joint venture.<br />
CSE 锁 定 中 国 基 金<br />
CSE 将 通 过 与 中 国 公 司 签 署 配 股 和 配 股 期 权<br />
协 议 获 取 大 约 1150 万 美 元 用 于 促 进 北 昆 士<br />
兰 州 Einasleigh 项 目 的 开 发 , 该 项 目 包 括 2 个<br />
铜 - 金 - 银 矿 和 4 个 锌 - 铅 - 银 矿 。<br />
CSE 已 与 北 京 和 泰 丰 元 创 国 际 发 展 有 限 公<br />
司 签 署 协 议 , 通 过 配 股 筹 集 582.2 万 澳 元 以<br />
及 配 股 期 权 筹 集 564 万 澳 元 。 该 协 议 的 有 效<br />
性 将 视 最 终 验 证 尽 职 调 查 、 股 东 大 会 同 意 、<br />
外 国 投 资 审 查 委 员 会 批 准 和 中 国 政 府 相 关 部<br />
门 批 准 的 结 果 而 定 。<br />
金 泰 是 四 川 泰 丰 股 份 有 限 公 司 与 四 川 省 地<br />
质 矿 产 勘 查 开 发 局 的 合 资 公 司 , 泰 丰 股 份 有<br />
限 公 司 是 四 川 泰 丰 集 团 的 全 资 子 公 司 。<br />
两 家 中 国 公 司 通 过 首 次 配 股 将 获 得<br />
CSE19.99% 的 股 权 , 在 三 年 内 通 过 配 股 期<br />
权 可 获 得 另 外 的 13.01%。CSE 还 和 泰 丰 签<br />
署 了 一 份 合 作 开 发 协 议 。<br />
通 过 配 股 募 得 的 582.2 万 美 元 将 用 于 完 成<br />
Einasleigh 项 目 中 Kaiser Bill, Einasleigh,<br />
Chloe, Jackson 和 Stella 矿 是 否 可 获 利 的 行<br />
性 研 究 报 告 (BFS)。<br />
根 据 合 作 开 发 协 议 , 如 果 BFS 报 告 肯 定 了<br />
目 前 对 于 可 开 采 资 源 、 生 产 成 本 和 开 发 成 本<br />
的 预 测 , 泰 丰 和 CSE 的 子 公 司 Einasleigh 资<br />
源 公 司 将 共 同 成 立 一 个 非 法 人 合 资 公 司 。<br />
泰 丰 接 下 来 将 以 9500 万 美 元 的 价 格 受 让 该<br />
项 目 70% 的 权 益 , 并 将 向 CSE 提 供 另 外 500<br />
万 美 元 的 贷 款 , 这 笔 贷 款 将 提 供 给 该 项 目 的<br />
开 发 基 金 , 必 要 时 , 该 笔 贷 款 的 利 息 以 及 配<br />
股 期 权 的 收 益 都 将 汇 入 开 发 基 金 。<br />
泰 丰 还 与 Einasleigh 资 源 公 司 签 署 了 一 份 股 权<br />
出 售 协 议 赋 予 泰 丰 公 司 收 购 CSE 公 司 在 上 述<br />
非 法 人 合 资 公 司 中 30% 股 权 的 优 先 取 舍 权 。<br />
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Papua New Guinea<br />
HORSE IVAAL TRUKAI RESOURCE BOOSTED BY 79%<br />
A drill pad in rugged country at Highlands Pacific’s Frieda copper gold project.<br />
HIGHLANDS Pacific believes its Frieda Horse<br />
Ivaal Trukai copper gold project in PNG is one<br />
of the world’s premier porphyry assets available<br />
for development this decade, after upgrading<br />
its mineral resource estimate for the<br />
Horse Ivaal Trukai deposit by 79% to 1.9 billion<br />
tonnes. <strong>The</strong> deposit is now estimated to<br />
contain 8.6 million tonnes of contained copper,<br />
14.3 million ounces of gold and 46 million<br />
ounces of silver.<br />
<strong>The</strong> Frieda project is one of the Asia-Pacific’s<br />
largest undeveloped copper/gold resources,<br />
situated 75km northeast of the Ok<br />
Tedi mine and 170km northwest of the giant<br />
Porgera gold mine in PNG. Using a 0.2%<br />
copper cut-off grade, the Horse Ivaal Trukai<br />
deposit’s total 1.9 billion tonnes of copper<br />
mineralization is estimated at a grade of<br />
0.45% copper, 0.22 grams/tonne gold and<br />
0.70 grams/tonne silver.<br />
Separate to the open pit deposit but within<br />
the Frieda district is a further 270 million<br />
tonnes of inferred copper resource at the<br />
Koki and Ekwai deposits.<br />
<strong>The</strong> company’s managing director John<br />
Gooding says, “Frieda has the capacity to be<br />
one of the largest, lower-operating cost copper<br />
projects in the world. Assets like Frieda<br />
with their major inventory and multi-decade<br />
potential are rare in the portfolios of junior resource<br />
companies and their value in corporate<br />
portfolios should not be underestimated.”<br />
<strong>The</strong> pre-feasibility study released in November<br />
2010 indicated the multi-decade life mine<br />
will have an average annual throughput of 50<br />
million tonnes. Subject to funding, construction<br />
of the open cut mine could begin next<br />
year, with production commencing in 2017.<br />
Meantime, seven holes have been drilled at<br />
Highlands Pacific’s Star Mountains Olgal copper<br />
and gold prospect, which is also near the<br />
Ok Tedi mine. <strong>The</strong> company wants to increase<br />
the Olgal drilling program with the aim<br />
of defining a JORC-compliant resource. <strong>The</strong><br />
Olgal prospect is one of 12 identified for further<br />
investigation, with two additional rigs due<br />
to arrive in September to test other copper/<br />
gold targets in the area.<br />
John Gooding says, “As the earlier exploration<br />
results show, great potential exists for a<br />
copper/gold prospect of significant scale with<br />
potential long-term synergies with the Ok Tedi<br />
mine which is nearing completion. We will also<br />
drill at the other prospects to test the potential<br />
for copper-porphyry clusters in the district.”<br />
<strong>The</strong> Star Mountain leases are about 20km<br />
north of the Ok Tedi mine and cover the Nong<br />
River skarns and the Star Mountains porphyry<br />
copper deposits - two areas known for<br />
copper/gold mineralization.<br />
Yandera resource upgrade<br />
ASSAY results from a drilling program at<br />
Marengo Mining’s Yandera project have<br />
prompted a substantial upgrade to its mineral<br />
resource inventory, with a 32% increase<br />
in copper. <strong>The</strong> company drilled 345 diamond<br />
holes totaling 113,716 metres at the project<br />
which is 95km southwest of the coastal<br />
town of Madang.<br />
Marengo’s managing director and CEO Les<br />
Emery says the results are a positive step forward<br />
in the development of a substantial<br />
long-life copper-molybdenum-gold mine.<br />
<strong>The</strong> drilling program identified mineralization<br />
to a depth of 981 metres at the Imbruminda<br />
zone, some 400 metres below the base of<br />
the current resource estimate, and down to a<br />
depth of 660 metres at the Gremi zone,<br />
which is 200 metres below the base.<br />
Drilling at Marengo Mining’s Yandera project, southwest of the town of Madang.<br />
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Papua New Guinea<br />
<strong>The</strong> revised estimate updates the company’s<br />
original October 2008 estimate with a<br />
measured resource of 113 million tonnes @<br />
0.57% copper equivalent, an indicated resource<br />
of 245 million tonnes @ 0.5% copper<br />
equivalent and an inferred resource of 417<br />
million tonnes @ 0.45% copper equivalent.<br />
Les Emery says, “<strong>The</strong> updated inventory<br />
has strengthened Marengo’s goal of developing<br />
a project with a minimum operation life of<br />
at least 20 years.”<br />
Marengo has also reported an inferred resource<br />
estimate of 776 million tonnes containing<br />
by-product metals comprising gold,<br />
silver and rhenium for 2.2 million ounces of<br />
gold, 42 million ounces of silver and 1.5 million<br />
ounces of rhenium. While these by-product<br />
metals are not included in the copper<br />
equivalent values, they are expected to make<br />
a significant contribution to the overall economics<br />
of the project.<br />
Sample data was composited to five metres<br />
and flagged by geological, weathering, alteration<br />
and grade shell domains. Resources<br />
were estimated separately for copper, molybdenum,<br />
gold and silver mineralization for the<br />
deposit. Rhenium was calculated using a<br />
molybdenum to rhenium regression for all<br />
blocks containing a molybdenum estimate.<br />
Les Emery says, “This resource estimate<br />
has confirmed our belief that the Yandera<br />
project will continue to grow in scale and has<br />
justified the continued focus on drilling at the<br />
Yandera Central Porphyry zone.<br />
“We have five diamond drill rigs operating<br />
on site, to complete further infill drilling, together<br />
with targeting, strike and depth extensions,<br />
to the known mineralization.”<br />
totaling 14,950 metres, providing 13,230 analyzed<br />
samples. Drill hole sample assays<br />
were composited to 3 metres, providing 4977<br />
data values inside the modeled area.<br />
Gold mineralization at Botlu is associated<br />
with volcanic breccias that cut through<br />
largely latite andesite and minor volcanic<br />
host rocks. It occurs with fine grained disseminated<br />
sulphides, with very fine grained<br />
gold mineralization of the highest grade in<br />
the matrix of the volcanic breccia. Pervasive<br />
silica, carbonate and potassic alteration of<br />
5-10% is commonly recorded.<br />
Ore is transported to the processing plant at Allied<br />
Gold’s Simberi project via overland conveyor.<br />
Botlu inferred resource up 172%<br />
ALLIED Gold has announced a 172% increase<br />
in its inferred mineral resource at the<br />
Simberi Gold Project’s Botlu deposit. Definition<br />
drilling has led to a 271,000 ounce increase<br />
in the newly updated JORC resource<br />
estimate of predominantly sulphide ore,<br />
which includes 8.4 million tonnes @ 1.59<br />
grams/tonne for a total of 429,000 ounces.<br />
Simberi is 85km from Lihir Island in the New<br />
Ireland province of PNG. It commenced production<br />
in 2008, producing 64,000 ounces in<br />
2009-10. Its processing plant is being expanded<br />
to an annual throughput of 3.5 million<br />
tonnes to produce 100,000 ounces each<br />
year by the end of 2011.<br />
<strong>The</strong> new resource estimate is based on results<br />
from 165 core, RC and aircore drill holes<br />
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Allied’s executive chairman Mark Caruso<br />
says, “Botlu provides another opportunity<br />
and source of additional material for our sulphide<br />
study which has until recently focused<br />
predominantly on the Sorowar and Pigiput<br />
deposits. This upgrade shows that the more<br />
we drill, the more we find and maintains our<br />
track record of continually increasing the Simberi<br />
resource base.”<br />
This news comes after the Simberi mine<br />
was forced to close for four weeks during<br />
March due to a leaking offshore tailings mixing<br />
tank. <strong>The</strong> company’s environmental consultants<br />
and advisors provided the PNG Department<br />
of Environment and Conservation (DEC)<br />
with a detailed report of repair works carried<br />
out on the tank’s valve and on-shore piping.<br />
<strong>The</strong> DEC sent two experts to visit the mine<br />
and carry out an independent inspection of<br />
the repair and the operating procedures. Allied<br />
believes its response was in accordance with<br />
world best practice standards.<br />
Mark Caruso says, “Simberi’s March quarter<br />
is likely to fall short of the previous December<br />
quarter because of the suspension of<br />
operations. <strong>The</strong> good thing is work on the expansion<br />
to 100,000 ounces/annum is moving<br />
ahead and exploration results from the Botlu<br />
pit continue to show the potential for oxide<br />
and sulphide resource extensions.”<br />
Goldminex Resources’ tenements within the Owen Stanley Ranges.<br />
Crater Mountain drill success<br />
GOLD has been intersected in the first drill<br />
hole at the Crater Mountain joint venture between<br />
New Guinea Gold and Gold Anomaly.<br />
Results show gold mineralization of 82 metres<br />
@ 1.62 grams/tonne within 284 metres<br />
@ 0.82 grams/tonne. Crater Mountain is in<br />
the Grasberg-Porgera Corridor in central<br />
PNG, southeast of Ok Tedi and Porgera.<br />
Gold Anomaly exploration director Peter<br />
McNab says, “<strong>The</strong> results are highly encouraging<br />
as they confirm the presence of a major<br />
alterated and mineralized system with the potential<br />
to define a large bulk tonnage of low<br />
grade gold mineralization, with zones of<br />
higher grade gold mineralization.<br />
“Above 306 metres depth these assays include<br />
significant intervals with average assay<br />
values above 1.5 grams/tonne gold totaling<br />
87 metres @ 2.04 grams/tonne gold. Given<br />
that Crater Mountain is above creek level the<br />
project has the benefit of having lower cut-off<br />
grades in any economic evaluation.”<br />
New Guinea Gold’s acting CEO Bob McNeil<br />
says, “<strong>The</strong> companies have recently signed<br />
an agreement whereby Gold Anomaly will acquire<br />
our 10% interest in Crater Mountain, in<br />
exchange for 31.25 million Gold Anomaly<br />
shares. <strong>The</strong>se shares will give us great flexibility<br />
in obtaining value for our interest.”<br />
Meanwhile, New Guinea Gold’s drilling,<br />
trenching, geochemical sampling and geophysical<br />
surveys at the Kavursuki mineralized<br />
zone suggest it will ultimately equal or exceed<br />
the oxide mineralization at the company’s<br />
Sinivit gold mine, which is 50km south-southwest<br />
of Rabaul on the Gazelle Peninsula in<br />
East New Britain province.<br />
Twenty one diamond core holes and more<br />
than 3000 metres of excavator trenching have<br />
confirmed a continuous, mineralized structural<br />
zone up to 50 metres in width and 1km in<br />
length. It is variably silicified and mineralized<br />
with silver and gold, and by analogy with the<br />
Sinivit zone, can be assumed that it will prove<br />
of similar strength in copper/gold/tellurium sulphides.<br />
Best results from the drilling include<br />
20.3 metres @ 3.28 grams/tonne gold including<br />
8 metres @ 6.49 grams/tonne.<br />
Bob McNeil says, “Kavursuki is proving to<br />
be a likely source of additional oxide ore to<br />
extend the life of the present mine. In addition,<br />
the style of mineralization and the geophysical<br />
results suggest that the oxide<br />
mineralization is likely to be underlain at depth<br />
by substantial volumes of copper/gold/tellurium<br />
sulphide mineralization. Ultimately, it’s<br />
likely that the Sinivit and Kavursuki zones will<br />
be proven to be one continuous, albeit erratically<br />
mineralized zone.”<br />
New Guinea Gold is investigating financing<br />
the Kavursuki resource for exploration and<br />
definition of the sulphide resource.<br />
Liamu survey confirms potential<br />
RESULTS from a detailed helicopter magnetic-radiometric<br />
survey at Goldminex Resources’<br />
Liamu project in the Owen Stanley<br />
Ranges of southeast PNG have confirmed<br />
the project’s porphyry copper-gold potential.<br />
A total of 2438 line kilometres of geophysical<br />
surveying was flown at a line spacing of 75<br />
metres covering an area of 10km by 15km<br />
over the Liamu intrusive complex, which is<br />
about 100km east of Port Moresby.<br />
Results from a petrographic study on a suite<br />
of mineralized rock samples have also revealed<br />
that the copper-gold mineralization, alteration<br />
and host rock types are similar to other<br />
large deposits worldwide. Several more targets<br />
have been identified for follow-up tests.<br />
Goldminex CEO Sandy Moyle says, “<strong>The</strong> further<br />
we advance our understanding of the project<br />
area, the more encouraging the system<br />
appears. Several targets generated by the interpretation<br />
of the heli-borne geophysical survey<br />
are peripheral to the known 15sqkm gold<br />
and copper mineralized portion of the Liamu<br />
intrusive complex. We aim to continue aggressive<br />
exploration at Liamu together with key<br />
prospects within the Owen Stanley Ranges.”<br />
Liamu lies within a pliocene intrusive complex<br />
that covers at least 35sqkm hosting zones of<br />
copper-gold mineralization. Exploration work is<br />
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Papua New Guinea<br />
concentrating on extensions of known mineralization<br />
to the north, however porphyry-style<br />
copper and gold mineralization has been found<br />
at several locations within Berefana prospect in<br />
the southern part of the Liamu complex.<br />
<strong>The</strong> mineralization occurs as disseminations,<br />
veins and stockworks closely associated with<br />
early potassic alteration. Grains of high fineness<br />
gold have been identified as inclusions in chalcopyrite<br />
and also in pyrite, which confirms the<br />
assay results that indicate Liamu has potential<br />
to host a gold-rich porphyry system.<br />
Petrographic results confirm the copper-gold<br />
mineralization at Liamu is hosted by a mixed<br />
suite of potassium-enriched, fine grained intrusive<br />
rocks of predominantly intermediate composition,<br />
which are similar to those commonly<br />
associated with large copper-gold deposits including<br />
PNG’s Ok Tedi and Porgera mines.<br />
Sandy Moyle says the company is reviewing<br />
a joint venture option with potential partners<br />
to enable substantial exploration<br />
programs and advance projects in the Owen<br />
Stanley region. “We are focused on the discovery<br />
of deposits with greater than 2 million<br />
ounces of gold, and our priority exploration<br />
area remains in the Owen Stanley Ranges.”<br />
Andewa drilling scheduled<br />
DRILLING at Frontier Resources’ Andewa<br />
copper and gold project on PNG’s New<br />
Britain Island is expected to begin this month.<br />
A systematic drilling program is scheduled in<br />
a bid to demonstrate the project is a worldclass<br />
gold and/or gold-copper-molybdenum<br />
deposit. Field crews have arrived on site to<br />
prepare for the deep drilling program, using<br />
the company’s own rigs.<br />
More than 5000 soil and rock samples<br />
have confirmed gold, copper, molybdenum,<br />
arsenic and antimony in assay results. Last<br />
year’s soil sampling returned peak soil<br />
grades of 18.9 grams/tonne gold and<br />
0.19% copper. Results from the 21sqkm<br />
grid of soil tested show there is one main<br />
central gold anomaly in excess of 5km-long<br />
and two additional gold-in-soil anomalies<br />
about 1-1.5km-long.<br />
Frontier says these anomalies, called the<br />
Core Chargeability, Ber and Ekhos zones,<br />
compellingly demonstrate the presence of<br />
very large sulphide systems from on-surface<br />
to more than 800 metres deep.<br />
Frontier’s managing director Peter McNeil<br />
says, “<strong>The</strong> enormous 3D-IP grid we completed<br />
was a calculated risk during a time of<br />
global uncertainty. <strong>The</strong> program was remarkably<br />
successful and has now rewarded<br />
directors and shareholders for their faith in<br />
the project. We have now geochemically<br />
and geophysically demonstrated the potential<br />
for a large-scale world-class epithermal<br />
gold deposit.<br />
“Much of the gold anomalous area within<br />
the Andewa crater has been adequately defined<br />
for first class exploration.”<br />
Frontier has previously drilled gold mineralization<br />
in a limited program at Komsen on the<br />
western margin of the Core Chargeability<br />
Zone from surface to a maximum depth of<br />
320 metres below surface. Those drill intercepts<br />
contained significant gold and base<br />
metals such as 2 metres @ 5.43 grams/tonne<br />
gold, 95 grams/tonne silver, 11.1% zinc,<br />
2.3% lead and 0.12% copper, and 7.9 metres<br />
of 10.01 grams/tonne gold.<br />
Andewa has good access by sea from the<br />
nearby port of Kimbe and requires only one<br />
bridge for land access by road. Neighbouring<br />
landowners near the coast are in support of<br />
the project and there are no permanent villages<br />
in or near the gridded area.<br />
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Central Asia<br />
EXTENSIVE GOLD DRILLING PROGRAM AT SHAMBESAI<br />
AN extensive drilling and exploration campaign<br />
is under way at Manas Resources’ gold<br />
projects in the Kyrgyz Republic. <strong>The</strong> company<br />
is drilling up to 20,000 metres with the<br />
aim of significantly increasing its resource<br />
base of 1.13 million ounces of gold.<br />
Six diamond drill rigs and two man-portable<br />
rigs are operating on three separate exploration<br />
projects with the majority of drilling to take<br />
place at the Shambesai project to lift highgrade<br />
oxide resources. Manas also wants to<br />
define more drill targets from 54 exploration targets<br />
across its 4200sqkm of licence areas.<br />
Manas will undertake around 10,000 metres<br />
of drilling at Shambesai with the purpose<br />
of rapidly upgrading all resources in<br />
the current pit optimization, testing areas for<br />
Core samples from Manas Resources’ Shambesai Gold Project.<br />
further shallow oxide at the edge of the existing<br />
resource and defining the zone at the<br />
western boundary of the current pit with the<br />
goal of substantially increasing the resource<br />
and pit extent.<br />
Drilling will also occur at prospects surrounding<br />
Shambesai, including Odbilla,<br />
Shambesai West and Purn. <strong>The</strong> company<br />
would like to provide additional mineable<br />
oxide that can be trucked to the Shambesai<br />
processing facilities. It will rapidly drill test four<br />
targets, three of which are within 7km of<br />
Shambesai. About 5000 metres of initial<br />
drilling will be undertaken at Shambesai<br />
West, Purn West and Obdilla West.<br />
<strong>The</strong> final exploration front for 2011 will be<br />
an ongoing regional program that will be carried<br />
out by three field teams. <strong>The</strong> program will<br />
drill test the massive 3.5km-long, high-tenor<br />
Nurlau gold-in-soil anomaly; complete surface<br />
sampling at the Sumap regional target,<br />
which is about 15km from Nurlau; and complete<br />
further prospecting on up to five of the<br />
54 regional targets.<br />
Manas has budgeted up to $5 million this<br />
year to complete the exploration and drilling<br />
programs. <strong>The</strong>se will run alongside the feasibility<br />
study and mine permitting process for<br />
Shambesai, which has the potential to begin<br />
production in 2012. <strong>The</strong> study and permitting<br />
are progressing well and are being undertaken<br />
by Manas’ project development team<br />
and local consultants.<br />
A scoping study complete in November<br />
2010 anticipates that Shambesai will produce<br />
its first 100,000 ounces at an average head<br />
grade of 5.7 grams/tonne gold in the first three<br />
years at a cash cost of US$180 per ounce.<br />
Fortis secures potash deposits<br />
ASX-LISTED Fortis Mining has become part<br />
of the global potash phenomenon by securing<br />
the rights to purchase two significant<br />
potash salt deposits in western Kazakhstan.<br />
Fortis has agreed to acquire the rights for a<br />
total cost of $US260 million.<br />
<strong>The</strong> Chelkar and Zhiliyanskoe salt deposits<br />
have an exploration target range of 6.5-6.6<br />
billion tonnes of potassium deposits, making<br />
them among the world’s largest potash salt<br />
deposits. Chelkar also has an exploration target<br />
range of 102-105 million tonnes of magnesium<br />
deposits.<br />
Acquisition of the assets has been secured<br />
through a variety of share sale agreements<br />
that will result in Fortis acquiring 75% of Hong<br />
Kong-based Ji'an Resources, which owns<br />
the deposits through a number of indirect<br />
shareholdings. <strong>The</strong> Ji'an acquisition involves<br />
the transfer of 40 million Fortis shares and $1<br />
million cash payment.<br />
Fortis has already paid US$30 million to<br />
secure the rights to the deposits in two instalments<br />
with a third instalment of $230 million<br />
due on July 7.<br />
Both areas were identified by geologists from<br />
the former Soviet Union during the 1950s. A<br />
substantial amount of systematic drilling,<br />
chemical analysis, hydrological surveying, seismic<br />
surveying and interpretation work was<br />
completed on both areas during the 1950s and<br />
early 60s when work ceased. In both areas geological<br />
resources were calculated and classified<br />
to the Soviet resource classification<br />
scheme that was in operation at the time.<br />
Fortis has been provided with original geological<br />
reports of this work which it is translating.<br />
While the work appears to have been<br />
done to a reasonable standard for the time, it<br />
is not considered to comply with the reporting<br />
requirements of the JORC code.<br />
Ji’an is undertaking further drilling and is<br />
working with the new and old data to further<br />
advance the project. Ji’an has a fully resourced<br />
development team of geologists and<br />
engineers in site at Zhiliyanskoe advancing<br />
the project. This group will form the nucleus<br />
of the team which will hopefully bring the project<br />
into production.<br />
Fortis Mining’s executive chairman Jitto<br />
Arulampalam says, “Fortis is very excited by<br />
the future prospects of these two mines to<br />
service the growing demand for potash ore,<br />
especially in China and India which are geographically<br />
located near Kazakhstan.<br />
“Fortis is undertaking further due diligence<br />
on the deposits, but we are confident that<br />
there is only limited investment and time<br />
needed to make the first of these deposits,<br />
Chelkar, operational. Already Fortis has<br />
shown in a reasonably short period of time<br />
that it can secure world-class assets and reward<br />
its shareholders. We have a range of<br />
funding options available to complete the<br />
transaction of securing these two mines.”<br />
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Central Asia<br />
Central Asia Metals sells subsidiary<br />
CENTRAL Asia Metals has reached an agreement<br />
to sell one of its Kazakhstan subsidiaries.<br />
<strong>The</strong> sale of Tochtar LLP is in line with the corporate<br />
strategy outlined at the time of Central<br />
Asia’s IPO in September 2010.<br />
<strong>The</strong> sale to Wildorf Holding Ltd for an agreed<br />
consideration of US$2.5 million consists of<br />
US$825,000 in cash and US$1.675 million of<br />
historical cost liabilities.<br />
Central Asia’s chief financial officer Nigel<br />
Robinson says, “Following on from our decision<br />
to cease mining operations at Tochtar in<br />
2009 we are delighted to have sold the subsidiary.<br />
<strong>The</strong> deal removes the potential historical<br />
cost liabilities and will enable Central Asia’s<br />
management to focus in Kazakhstan on the<br />
delivery of the Kounrad Copper Project.”<br />
Central Asia Metals has interests in a number<br />
of copper, gold and molybdenum mining exploration<br />
and development assets in Kazakhstan<br />
and Mongolia.<br />
In Kazakhstan, the company has advanced<br />
plans for construction of a plant at the former<br />
Kounrad mine that will have the capacity to annually<br />
deliver 10,000 tonnes of near term, lowcost<br />
copper production. It plans to construct<br />
the plant with a joint venture with a Kazakh<br />
government entity, Saryarka.<br />
Kounrad is a former open-pit copper mine<br />
that operated between 1936 and 2005. <strong>The</strong><br />
site around the mine contains a number of<br />
dumps of waste material from the mine from<br />
which copper can be extracted through an insitu<br />
leaching process followed by Solvent Extraction<br />
– Electro-Winning (SX-EW).<br />
Initial construction ground-works for the<br />
commercial SX-EW plant have started and production<br />
at the plant is expected to start in the<br />
fourth quarter of 2011. Central Asia also has<br />
exploration opportunities in the region. One of<br />
these is Alag Bayan, an early stage exploration<br />
project in Mongolia, where the company is focused<br />
on outlining a potentially significant copper/gold<br />
porphyry target. This asset is situated<br />
close to the Oyu Tolgoi copper mine being developed<br />
by Rio Tinto and Ivanhoe Mines.<br />
In addition Central Asia plans to develop further<br />
its molybdenum exploration project,<br />
Handgait, and its gold exploration project,<br />
Ereen, both in Mongolia.<br />
New Uzboy gold resource reports expected<br />
ALHAMBRA Resources expects to receive<br />
two new resource reports in the second half<br />
of 2011 covering new deposits at its Uzboy<br />
Gold Project in northern Kazakhstan. Increasing<br />
resources and ramping up production are<br />
the company’s cornerstones for continued<br />
growth during 2011.<br />
An updated NI 43-101 resource report was<br />
expected for the Uzboy deposit by the end of<br />
April while new reports will be delivered by independent<br />
geological consultants ACA Howe<br />
International for the Dombraly and Shirotnaia<br />
deposits by the end of the year.<br />
An updated scoping study for the Uzboy<br />
project was also expected to be received by<br />
the company by the end of April. <strong>The</strong> study<br />
was based on the NI 43-101 resource report<br />
dated June 2, 2008 and valued the resources<br />
at a gold price of US$850/ounce. <strong>The</strong> updated<br />
study will be based on the most recent<br />
resource report with a valuation based on<br />
current gold prices.<br />
During the 2011 field season Alhambra anticipates<br />
implementing an exploration program,<br />
subject to sufficient cash flow and suitable financing,<br />
which could range from two to three<br />
times larger than the exploration program completed<br />
in 2010. Drilling will be focused on the<br />
three advanced exploration areas of Uzboy,<br />
Dombraly and Shirotnaia, as well as the four<br />
early stage exploration areas of Kerbay, North<br />
Balusty, Zhanatobe and Vasilkovskoe East.<br />
In addition to the advanced and early<br />
stage exploration areas, Alhambra has an<br />
inventory of about 100 other gold targets<br />
and these are areas of anticipated high potential.<br />
<strong>The</strong> company anticipates that a<br />
number of these targets will be assessed<br />
further in the remainder of 2011.<br />
During 2010, a number of operational recommendations<br />
were made regarding changes to<br />
Alhambra's mining operations and these are<br />
anticipated to lead to increased efficiency in<br />
gold recovery in 2011. Recommendations include<br />
placing emitters on side slopes to decease<br />
inventory of gold as well as re-leaching<br />
rested older areas of the heaps, heating the<br />
leach pad solution for longer periods of time to<br />
reduce the impact of freezing, and crushing the<br />
harder deeper ores to improve leach recovery.<br />
Alhambra’s tenements are in northern Kazakhstan, adjacent to a number of large gold deposits.<br />
In November 2010, Alhambra executed an<br />
engagement letter with CITIC Securities Corporate<br />
Finance (HK) to act as its financial advisor<br />
and to assess the feasibility of seeking a<br />
dual listing of Alhambra's common shares on<br />
an Asian stock exchange. CITIC continues to<br />
assess this situation.<br />
Uranium business spun-off<br />
AIM-LISTED Eurasia Mining has nominated Energy<br />
Resources Asia (ERA) to be the legal<br />
holder of the Kamushanovsky Uranium Project<br />
in the Kyrgyz Republic. Eurasia jointly owns Energy<br />
Resources Asia with Afrasia Mining & Energy<br />
Investment Holdings.<br />
In January, Eurasia signed a memorandum<br />
of understanding (MoU) to acquire a 55% interest<br />
in Kamushanovsky, an advanced uranium<br />
project in the country’s north.<br />
<strong>The</strong> project is in the flood plain of the Chui<br />
River, 60km northwest of the capital Bishkek.<br />
It has been the focus of a five-year exploration<br />
program and it is estimated that there<br />
are at least 1775 tonnes of uranium oxide<br />
within the licence area.<br />
<strong>The</strong> establishment of ERA will allow the uranium<br />
business to be developed separately from<br />
Eurasia’s precious metal business. Optiva Securities<br />
will conduct a fundraising on behalf of<br />
ERA to raise US$2.2 million. <strong>The</strong> funds will enable<br />
ERA to execute the MoU, acquire the interest<br />
in the project and progress it.<br />
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India<br />
INDONESIA WILL HELP MEET INDIA’S COAL DEMAND<br />
Above ground infrastructure at Carbon Energy’s<br />
Bloodwood Creek project in Queensland.<br />
EMERGING coal supply areas in Indonesia<br />
will be instrumental in meeting rapidly growing<br />
coal demand from India, according to energy,<br />
mining and metals research consultancy<br />
Wood Mackenzie.<br />
Drawing on information contained within<br />
Wood Mackenzie’s Coal Supply Service and<br />
Global Cost and Margin Tool, coal research<br />
analyst Rohan Kendall told delegates at Coaltrans<br />
India 2011 in New Delhi: “Indonesia will<br />
account for 40% of growth in seaborne thermal<br />
coal supply over the next 10 years, with<br />
the emerging coal areas of the South Sumatra<br />
basin and Wahau coal field making an important<br />
contribution to this growth. <strong>The</strong>re is<br />
US$8 billion of infrastructure projects in the<br />
pipeline in these emerging areas that will support<br />
export growth.”<br />
He said emerging coal regions were a good<br />
fit for developing economies, such as India, because<br />
the basins contained abundant reserves.<br />
<strong>The</strong>se areas were experiencing upstream investment<br />
as Indian power generators such as<br />
Reliance and Adani looked to secure coal supplies<br />
for new power stations.<br />
<strong>The</strong>re are several ultra-mega power plants<br />
being built in India with a capacity of more<br />
than 4000MW each and still more are<br />
planned. <strong>The</strong> projects currently in development<br />
are similar in capacity to those in China<br />
and are expected to be operational between<br />
the second half of 2011 and 2014.<br />
Rohan Kendall said, “Coal production costs<br />
are low in emerging basins in Indonesia,<br />
which is why they are attractive to Indian<br />
power generators. <strong>The</strong> costs of investing upstream<br />
to secure coal requirements are much<br />
lower than Indian power generators would<br />
otherwise pay if they were to purchase all of<br />
their coal on the seaborne market. Also, for<br />
power stations that are being built on the<br />
coast, it is more realistic to seek seaborne<br />
supplies which do not depend on India’s rail<br />
network for transport.”<br />
He said that in order for emerging thermal<br />
coal supply areas to fulfil their potential, infrastructure<br />
challenges needed to be overcome.<br />
“<strong>The</strong>re is currently insufficient infrastructure in<br />
these areas to support large scale coal exports.<br />
<strong>The</strong>re are numerous projects proposed<br />
which combined would add 140 million<br />
tonnes per annum of capacity. We believe<br />
that some of these are unlikely to progress<br />
given regulatory challenges.”<br />
Monnet Ispat and Energy (MIEL) is one<br />
company taking this step with acquisition of<br />
PT Sarwa Sembada Karya Bumi's coal mine<br />
in Sumatra, Indonesia, for $24 million.<br />
Spread over 25,000 hectares in Jambi<br />
province, the mine provides MIEL access to<br />
one of the largest thermal coal deposits in the<br />
world and gives it a captive source to fire its<br />
upcoming power projects. MIEL is working on<br />
a 1700MW thermal power plant in Orissa and<br />
plans to put up one more plant of 1300MW<br />
capacity somewhere in Gujarat or Tamil Nadu.<br />
MoU to pursue UCG operations<br />
CARBON Energy has signed a Memorandum<br />
of Understanding (MoU) with Adani Enterprises,<br />
a member of the Adani Group of India, with the<br />
aim of establishing a joint venture in India to pursue<br />
Underground Coal Gasification (UCG).<br />
<strong>The</strong> first opportunity that Adani and ASXlisted<br />
Carbon Energy will explore has arisen<br />
as a result of Coal India, a Government of<br />
India undertaking, operating a tender process<br />
in which Indian coal firms have sought UCG<br />
technology partners to participate in joint venture<br />
development of UCG interests. <strong>The</strong> MoU<br />
facilitates the partnership between Carbon<br />
Energy and Adani to jointly participate in this<br />
tender submission.<br />
<strong>The</strong> MoU is for 18 months during which it is<br />
anticipated that Adani and Carbon Energy will<br />
jointly prepare and submit a bid to establish a<br />
UCG project on Coal India tenements in India.<br />
If the bid is successful, Adani will bear all costs<br />
throughout the exploration phase, including<br />
Carbon Energy's reasonable costs, until exploration<br />
has been successfully conducted<br />
and a suitable UCG resource established.<br />
Adani and Carbon Energy then anticipate<br />
forming a joint venture company in India in<br />
which Adani will have a 75% share and commitment<br />
and Carbon Energy will have a 25%<br />
share and commitment.<br />
India is among the top three fastest growing<br />
economies of the world and its energy needs<br />
are rapidly expanding with its increased industrialization<br />
and capacity addition in power<br />
generation. Coal is the most dominant source<br />
of energy in India's energy mix.<br />
Carbon Energy’s managing director Andrew<br />
Dash says that partnership with Adani brings<br />
significant benefit to the company. “Carbon<br />
Energy will now be pursuing projects on three<br />
continents with the addition of India to our existing<br />
interests in Australia and in Chile. Adani<br />
is a major player in the Indian coal and power<br />
industries and has already established itself<br />
in Queensland, Australia. We are looking forward<br />
to working with Adani to build Carbon<br />
Energy's UCG project base in India.”<br />
Adani Group's president - corporate planning<br />
Harsh Mishra says, “Adani has selected<br />
Carbon Energy as our technology partner for<br />
this important submission to Coal India as it<br />
is the leading proponent of UCG globally and<br />
it has superiority in UCG technology based<br />
on extensive research conducted in conjunction<br />
with Australia's CSIRO.”<br />
Carbon Energy's purpose is to produce<br />
clean energy and chemicals feedstock from<br />
UCG syngas. Its unique approach to UCG<br />
and syngas production produces a low cost<br />
option for capturing CO2, making it a leader<br />
in clean coal technology. Its ambition is for<br />
syngas to become the preferred feedstock for<br />
producing clean coal power stations, an alternative<br />
to oil-based fuel, agribusiness products,<br />
polyolefin products and allowing for<br />
economic carbon capture.<br />
68 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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China<br />
CHINA’S GROWTH PATH STREWN WITH GOLD<br />
BY JOHN MILLER, <strong>ASIA</strong> MINER EDITOR<br />
CHINA is the dominant force in global gold<br />
production and is playing an increasingly important<br />
role in gold markets as the standard<br />
of living of its 1 billion-plus residents improves<br />
and its economy strengthens.<br />
<strong>The</strong> future for gold mining in China is huge,<br />
according to Majestic Gold’s president Rod<br />
Husband. “China has gone from number six<br />
producer in the world in 2003 to number one.<br />
South Africa has gone down in terms of production<br />
and China has gone up to more than<br />
10 million ounces a year.”<br />
Majestic is one of a handful of foreign companies<br />
that have remained in China through<br />
the thick and thin of economic booms and<br />
the global financial crisis and is about to reap<br />
the benefits by becoming a large-scale producer<br />
at its Songjiagou project.<br />
Rod Husband told <strong>The</strong> <strong>ASIA</strong> <strong>Miner</strong> that<br />
China has a very high affinity for gold and the<br />
government buys every ounce that’s sold<br />
through the Shanghai Metals Exchange. “Individuals<br />
in China who want gold have to find<br />
other ways to buy it.<br />
“I don’t know what their long-term foreign<br />
exchange strategy is but it seems they are<br />
happy to convert their US dollars to gold and<br />
potentially go to a gold standard. If that is the<br />
case then the gold industry will be in a great<br />
position for years.<br />
“About 10 years ago China opened up the<br />
doors to bring in western exploration expertise,<br />
which helped them change their mining<br />
industry with a lot of resources defined. Some<br />
foreign companies had success and became<br />
miners, like Silvercorp and Eldorado with Majestic<br />
about to do the same, but when the<br />
downturn came many others sold the resources<br />
back to China which is now pushing<br />
them into production.<br />
“This expertise enabled China to increase<br />
production which, together with the economic<br />
boom the country has experienced, means<br />
China has a growing surplus of cash and is<br />
able to take back more control of exploration.”<br />
Majestic came to China in 2003 and was<br />
one of the earliest foreign companies to test<br />
the waters. Today there are not many foreign<br />
companies operating in China. Rod Husband<br />
says in 2005 it was something like 200 but<br />
now there are only about 25. While many Chinese<br />
companies are more proficient at all aspects<br />
of exploration and mining, the global<br />
downturn also took its toll on many foreign<br />
companies in China.<br />
He says with the way deals are structured<br />
in China with joint venture companies having<br />
to contribute capital, the downturn meant<br />
many had difficulty meeting commitments<br />
with the result that the government or Chinese<br />
partners bought back the projects, and<br />
did so at fair value.<br />
“<strong>The</strong>y recognized the work that had been<br />
done and paid fair price. We did that with our<br />
Sawayaerdun project which was fairly remote<br />
and logistically challenging for us. It had huge<br />
potential and we had spent about $8 million<br />
through our joint venture but the government<br />
came and bought it back for $9 million. We<br />
needed that money to focus on Songjiagou<br />
so it was a good deal for everyone.”<br />
<strong>The</strong> Chinese need resources to feed their<br />
growth and while they are doing much to lift<br />
domestic exploration and production, they<br />
are also looking to overseas sources.<br />
“<strong>The</strong>y want the metal and will get it one way<br />
or another,” Rod Husband says. “Now they<br />
have to buy concentrate at higher prices but<br />
what they want to do is go down the food<br />
chain and add value. With copper the average<br />
global cost for production is $1.50-$1.75<br />
a pound. You can buy copper for $4.30 a<br />
pound or if you mine it you can produce it and<br />
sell the concentrate for $2 a pound and the<br />
value adding goes to the smelter. What China<br />
is looking at is producing from the basic level<br />
in which case the cost of that pound of copper<br />
becomes 50 or 60 cents and the value<br />
gets added in China.<br />
“China is buying up resources around the<br />
world – they are buying juniors in Australia, buying<br />
projects in Africa and investing in Canadian<br />
companies. <strong>The</strong>y went after the big companies<br />
first but did not succeed. <strong>The</strong>y are still interested<br />
in them but have realized it is politically difficult<br />
so now they are buying the future of those big<br />
companies – the juniors. <strong>The</strong> big companies<br />
currently sustain through acquisitions, buying<br />
junior companies and their resources, thus<br />
maintaining their resource bases. So, China is<br />
now buying many juniors and projects, depriving<br />
big companies of their future resources.”<br />
Rod Husband says China’s influence on the<br />
global gold industry will continue to increase.<br />
“Just look at per capita consumption and<br />
how that has changed. When Majestic entered<br />
China the nation’s annual per capita<br />
gold consumption was just under 0.2 grams,<br />
the world average was about 0.6 and western<br />
countries consumed 0.8. Now China is<br />
up to 0.25 or 0.26 grams and is catching up<br />
to the west. India has a higher affinity than the<br />
west at 1 gram and that’s where we expect<br />
China to get to. If China just gets to the 0.6<br />
gram mark, that’s a 25% increase in consumption,<br />
or 10 million ounces, which is how<br />
much China now produces.<br />
“So what’s going to happen to gold prices<br />
and gold demand <strong>The</strong>re’s no question it’s<br />
going up and up. It is considered by many as<br />
a currency now and all major funds are trading<br />
gold like they trade Dollar-Euro or Dollar-Yen.<br />
<strong>The</strong>re’s probably going to be a lot of pressure<br />
for it to get there, but in terms of demand I can<br />
easily see it going to $3000,” he added.<br />
中 国 发 展 之 路 铺 满 黄 金<br />
中 国 市 场 是 全 球 黄 金 市 场 的 主 导 力 量 , 随 着<br />
超 过 十 亿 人 口 的 生 活 水 平 不 断 提 高 以 及 经 济<br />
发 展 不 断 增 强 , 中 国 因 素 正 在 全 球 黄 金 市 场<br />
中 发 挥 着 日 益 重 要 的 作 用 。<br />
根 据 Majestic 金 矿 公 司 总 裁 Rod Husband<br />
的 观 点 , 在 中 国 进 行 金 矿 开 发 的 前 景 十 分 广<br />
大 。“ 中 国 的 黄 金 产 量 从 2003 年 全 球 第 六 升<br />
至 现 在 的 第 一 位 。 南 非 的 产 量 正 在 递 减 而 中<br />
国 年 产 量 已 经 超 过 一 千 万 盎 司 。”<br />
Majestic 金 矿 公 司 是 屈 指 可 数 的 几 个 历 经<br />
经 济 繁 荣 时 期 和 全 球 金 融 危 机 的 跌 宕 起 伏 后<br />
仍 留 守 在 中 国 的 外 国 公 司 之 一 , 旗 下 的 宋 家<br />
沟 项 目 就 要 开 始 大 规 模 生 产 , 公 司 即 将 收 获<br />
硕 果 。<br />
Rod Husband 告 诉 《 亚 洲 矿 业 》 杂 志 , 中<br />
国 人 喜 爱 黄 金 , 而 政 府 几 乎 买 光 了 所 有 在 上<br />
海 金 属 交 易 所 出 售 的 黄 金 ,“ 中 国 想 买 黄 金<br />
的 个 人 只 能 寻 找 其 他 途 径 购 买 。”<br />
“ 我 不 清 楚 中 国 的 长 期 外 汇 战 略 将 是 什<br />
么 , 但 他 们 似 乎 乐 于 将 美 元 转 换 成 金 条 , 并<br />
且 有 可 能 走 向 金 本 位 制 。 如 果 是 这 样 的 话 那<br />
黄 金 行 业 将 在 未 来 多 年 内 处 于 极 佳 地 位 。”<br />
“ 大 约 十 年 前 中 国 采 取 开 放 政 策 , 引 进 西<br />
方 勘 探 专 业 技 术 , 大 大 改 变 了 中 国 的 矿 业 局<br />
面 , 确 定 了 许 多 资 源 。” 一 些 外 国 公 司 取 得<br />
了 成 功 , 成 为 采 矿 公 司 , 比 如 希 尔 威 矿 业 和<br />
44 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
News 3_<strong>Layout</strong> 1 4/21/11 2:45 PM Page 45<br />
China<br />
埃 尔 拉 多 黄 金 公 司 ,Majestic 公 司 也 是 如<br />
此 。 但 是 当 行 业 不 景 气 时 , 许 多 外 国 公 司 将<br />
项 目 卖 回 给 中 国 , 而 中 国 现 在 正 在 使 这 些 项<br />
目 尽 快 生 产 。<br />
“ 这 些 专 业 技 术 帮 助 了 中 国 提 高 黄 金 产<br />
量 , 再 加 上 这 个 国 家 正 在 经 历 的 经 济 蓬 勃 发<br />
展 , 意 味 着 中 国 有 着 日 益 增 长 的 富 余 现 金 流<br />
收 回 对 资 源 勘 探 的 控 制 权 。”<br />
Majestic 金 矿 公 司 于 2003 年 来 到 中 国 , 是<br />
第 一 批 试 水 的 先 行 者 。 现 在 在 中 国 也 没 有 太<br />
多 处 于 运 营 阶 段 的 外 国 公 司 。Rod Husband<br />
说 2005 年 的 时 候 大 概 有 200 家 , 而 今 只 剩 下<br />
25 家 。 众 多 中 国 企 业 无 论 在 勘 探 还 是 开 采<br />
方 面 都 更 加 精 通 了 , 而 世 界 经 济 衰 退 对 许 多<br />
在 中 国 的 外 国 公 司 打 击 颇 大 。<br />
他 说 这 与 国 内 许 多 项 目 合 作 结 构 有 关 , 一<br />
般 来 说 合 资 公 司 需 要 贡 献 资 本 金 , 而 经 济 危<br />
机 使 得 他 们 难 以 满 足 合 作 时 做 出 的 承 诺 , 结<br />
果 自 然 是 中 国 政 府 或 中 方 合 作 方 以 公 平 的 价<br />
格 将 项 目 赎 回 。<br />
“ 他 们 认 可 前 期 已 投 入 的 工 作 量 所 以 支 付<br />
了 合 理 价 格 。 我 们 的 萨 瓦 亚 尔 顿 就 是 这 样<br />
的 , 这 个 项 目 地 处 偏 远 , 对 我 们 而 言 在 运 输<br />
方 便 是 一 个 挑 战 。 项 目 潜 力 巨 大 , 我 们 在 合<br />
资 公 司 投 入 了 800 万 美 金 , 政 府 回 购 的 价 格<br />
则 是 900 万 美 金 。 我 们 也 需 要 这 笔 钱 投 入 到<br />
宋 家 沟 项 目 , 这 对 合 作 各 方 都 是 一 笔 不 错 的<br />
交 易 。”<br />
中 国 需 要 资 源 来 满 足 经 济 增 长 , 他 们 正 努<br />
力 提 升 国 内 勘 探 和 开 发 , 同 时 也 在 寻 找 海 外<br />
资 源 。<br />
“ 中 国 需 要 金 属 , 他 们 将 以 这 样 或 那 样 的<br />
方 式 获 得 ,” Rod Husband 说 。 “ 现 在 他 们<br />
不 得 不 购 买 价 格 较 高 的 精 矿 , 但 他 们 真 正 想<br />
做 是 深 入 食 物 链 下 游 以 获 取 增 加 值 。 铜 的 全<br />
球 平 均 生 产 成 本 为 1.50 - 1.75 美 元 / 磅 。 你 可<br />
以 以 每 磅 4.30 美 元 的 价 格 购 买 铜 , 或 是 自 己<br />
开 矿 然 后 生 产 并 以 2 美 元 / 磅 的 价 格 出 售 铜 精<br />
矿 , 从 而 铜 冶 炼 厂 获 得 这 部 分 的 附 加 值 。 中<br />
国 正 在 寻 求 的 是 基 本 层 面 上 的 生 产 , 在 这 种<br />
情 况 下 , 每 磅 铜 的 成 本 是 50 或 60 美 分 , 增<br />
加 的 附 加 值 由 中 国 获 得 。<br />
“ 中 国 是 在 世 界 范 围 内 到 处 购 买 资 源 - 他 们<br />
在 澳 大 利 亚 收 购 小 型 公 司 , 在 非 洲 买 项 目 ,<br />
在 加 拿 大 进 行 股 权 投 资 。 他 们 的 首 要 追 逐 目<br />
标 是 那 些 大 型 矿 业 公 司 , 但 没 有 成 功 。 但 他<br />
们 仍 然 感 兴 趣 , 但 意 识 到 这 样 的 方 式 具 有 政<br />
治 困 难 , 所 以 现 在 他 们 购 买 了 未 来 可 能 成 为<br />
大 公 司 的 潜 力 股 —— 小 型 公 司 。 大 公 司 一 般<br />
通 过 收 购 ( 购 买 小 型 公 司 和 其 资 源 ) 来 维 持<br />
他 们 的 资 源 储 备 。 所 以 , 中 国 现 在 正 是 购 买<br />
许 多 小 型 公 司 和 项 目 , 拿 走 了 大 公 司 未 来 的<br />
资 源 来 源 。”<br />
他 还 说 中 国 对 全 球 黄 金 行 业 的 影 响 还 将 继<br />
续 增 强 。“ 只 消 看 一 眼 人 均 消 费 量 以 及 这 个<br />
数 字 是 如 何 改 变 的 。 当 公 司 刚 进 入 中 国 时 那<br />
时 人 均 黄 金 消 费 量 略 低 于 0.2 克 , 那 时 世 界<br />
平 均 水 平 约 为 0.6 克 , 西 方 国 家 为 0.8 克 。 现<br />
在 中 国 人 均 消 费 量 高 达 0.25 甚 至 0.26 克 , 正<br />
在 追 赶 西 方 。 印 度 人 比 西 方 更 热 衷 于 对 金 子<br />
的 消 费 , 人 均 消 费 量 高 达 1 克 , 这 正 是 我 们<br />
预 计 中 国 将 达 到 的 水 平 。 如 果 中 国 的 人 均 消<br />
费 量 停 留 在 0.6 克 大 关 , 也 就 是 说 消 费 增 长<br />
25%, 折 合 10 万 盎 司 金 , 这 是 数 字 正 好 与<br />
中 国 的 现 有 产 量 持 平 。<br />
“ 所 以 说 黄 金 价 格 和 黄 金 的 需 求 将 何 去 何<br />
从 呢 毫 无 疑 问 , 将 逐 步 攀 升 。 许 多 人 都 认<br />
为 金 子 是 一 种 货 币 , 所 有 的 大 型 基 金 都 在 像<br />
交 易 美 元 对 欧 元 或 美 元 对 日 元 一 样 进 行 黄 金<br />
交 易 。 可 能 在 上 升 过 程 中 要 遭 遇 很 多 压 力 ,<br />
但 从 需 求 角 度 出 发 , 我 觉 得 3000 美 元 每 盎<br />
司 不 难 达 到 ,” 他 补 充 说 。<br />
A Majestic transformation<br />
MAJESTIC Gold is transforming from explorer<br />
and very small-scale producer into a largescale<br />
production company through ongoing<br />
development of the Songjiagou Gold Project<br />
in Shandong province.<br />
<strong>The</strong> company is processing 1400 tonnes<br />
each day through the existing Songjiagou<br />
plant but is in the final stages of constructing<br />
a new mill with daily capacity of 6000 tonnes.<br />
It expects to begin throughput at the new mill<br />
during May, which will bring daily processing<br />
at Songjiagou to 7400 tonnes.<br />
Majestic’s president and CEO Rod Husband<br />
says the company is ramping up mining activity<br />
to feed the new mill with material being<br />
stockpiled at the mill ready for processing.<br />
He says based on a recent preliminary assessment<br />
report prepared by Wardrop, a Tetra<br />
Tech company, Majestic will be able to produce<br />
around 105,000 ounces annually for the<br />
next 22 years, however, the company is considering<br />
additional capacity expansion in the<br />
next few years as 22 years is a lengthy mine<br />
life and it should be more like 10-15 years.<br />
“We are also focused on completing a detailed<br />
five year mine plan and then implementing<br />
it so we have proper grade control. At<br />
present we just dig the dirt and run it through<br />
the mill but once we have a proper plan and<br />
grade control we expect to be able to lift production<br />
substantially, up to 250,000 ounces.”<br />
<strong>The</strong> Wardrop report also recommends two<br />
phases of exploration designed to upgrade<br />
and expand the resource with the first<br />
phase focusing on increasing the level of<br />
confidence in the shallower portion of the<br />
resource and the second focusing on<br />
deeper mineralization as well as additional<br />
resources at depth and along strike.<br />
Rod Husband says, “It’s an exciting time as<br />
we are just months away from transforming<br />
to a full-on production company and it’s really<br />
largely because we are in China. You can’t do<br />
that in North America – you have to wait for<br />
engineering reports, obtain the capex and<br />
then build the mill.<br />
New processing facilities under construction at Majestic Gold’s Songjiagou project in Shandong province.<br />
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China<br />
“ 我 们 的 合 作 伙 伴 , 即 公 司 的 大 股 东 , 为<br />
项 目 建 设 提 供 了 资 金 , 他 清 楚 地 知 道 那 里 有<br />
什 么 。 他 曾 经 在 此 进 行 了 长 达 七 年 的 小 规 模<br />
开 采 , 所 以 只 是 一 个 认 识 到 项 目 规 模 效 益 后<br />
进 行 扩 产 的 问 题 。”<br />
他 还 说 Majestic 金 矿 公 司 还 在 评 估 其 他 几<br />
个 中 国 的 项 目 。“ 其 中 一 个 是 位 于 中 国 南 方<br />
的 小 型 露 天 开 采 矿 , 采 用 氰 化 物 浸 出 工 艺 。<br />
正 在 进 行 尽 职 调 查 , 我 们 认 为 它 可 能 含 有<br />
50 万 到 100 万 盎 司 的 金 。”<br />
“ 通 过 这 个 项 目 我 们 将 获 得 事 业 拓 展 所 必<br />
要 的 现 金 流 , 正 如 大 家 所 知 , 在 中 国 有 着 巨<br />
大 的 机 会 。 我 们 面 临 的 地 质 风 险 较 低 , 因 为<br />
介 入 的 是 未 经 充 分 勘 探 的 已 有 矿 山 , 你 所 需<br />
要 做 的 仅 仅 是 将 资 源 钻 探 出 来 , 并 重 新 设 计<br />
开 采 方 案 。”<br />
Rod Husband 说 公 司 同 时 在 考 虑 将 在 中 国<br />
国 内 的 这 部 分 资 产 拿 出 来 在 香 港 上 市 。“ 香<br />
港 平 台 上 的 亚 洲 投 资 者 对 外 国 公 司 具 有 更 开<br />
放 的 态 度 。 上 市 的 成 本 很 高 , 要 求 项 目 至 少<br />
值 一 亿 港 元 以 上 才 划 算 , 我 们 希 望 能 到 达 那<br />
个 阶 段 。”<br />
<strong>The</strong> Mei Feng Coal Project of China Coal Corporation in Xinjiang province.<br />
“Our partner, the company’s biggest<br />
shareholder, has funded construction as we<br />
progressed because he knows what’s there.<br />
He’s been mining it for seven years on a<br />
small scale and it’s just a matter of recognizing<br />
the economies of scale and making<br />
the operation bigger.”<br />
He says Majestic is evaluating a couple of<br />
other projects in China. “One of them is a<br />
small open pit, cyanide leach operation in<br />
southern China. We are doing due diligence<br />
and think it has the potential to hold between<br />
500,000 and 1 million ounces.<br />
“We will have the cashflow to expand organically<br />
from here and, as everyone knows, there<br />
are tremendous opportunities in China. <strong>The</strong><br />
geological risk is low because you do deals on<br />
existing mines that haven’t been explored<br />
properly, so all you have to do is drill out the<br />
resource then redesign the way to mine it.”<br />
Rod Husband says Majestic is also considering<br />
listing Chinese assets on the Hong<br />
Kong exchange. “It seems Asian investors<br />
through Hong Kong have a much more open<br />
attitude towards foreign companies. It’s expensive<br />
to list so you need projects worth at<br />
least $100 million to make it worthwhile and<br />
we are hopeful of getting to that stage.”<br />
Majestic 公 司 的 重 大 角 色 转 换<br />
随 着 山 东 省 宋 家 沟 金 矿 项 目 的 不 断 推 进 ,<br />
Majestic 金 矿 公 司 正 在 从 勘 探 和 小 规 模 生 产<br />
商 转 型 为 大 规 模 生 产 商 。<br />
现 阶 段 该 公 司 的 宋 家 沟 选 厂 日 处 理 量 为<br />
1400 吨 , 正 在 建 设 中 的 规 划 日 处 理 量 6000<br />
吨 的 新 选 厂 已 处 在 收 尾 阶 段 。 预 计 这 一 新<br />
选 厂 将 在 5 月 份 投 产 , 由 此 宋 家 沟 项 目 的 日<br />
处 理 量 将 达 到 7400 吨 。<br />
Majestic 金 矿 公 司 总 裁 长 兼 首 席 执 行 官 Rod<br />
Husband 说 正 在 进 行 矿 山 扩 产 以 满 足 选 厂<br />
的 处 理 量 。 物 料 正 被 堆 积 在 选 厂 准 备 下 一<br />
步 处 理 。<br />
据 他 介 绍 , 根 据 一 份 由 Wardrop 公 司 (<br />
Tetra Tech) 完 成 的 最 新 初 步 评 估 报 告 ,Majestic<br />
金 矿 公 司 将 在 今 后 的 22 年 内 年 产 金<br />
10.5 万 盎 司 , 但 公 司 正 在 考 虑 在 数 年 内 进 一<br />
步 扩 产 ,22 年 的 矿 山 寿 命 相 对 较 长 , 应 该<br />
在 10 至 15 年 之 间 。<br />
“ 我 们 还 在 集 中 精 力 完 成 一 份 详 细 的 五 年<br />
采 矿 计 划 然 后 实 施 , 从 而 做 好 合 适 的 品 位 控<br />
制 。 目 前 我 们 还 只 是 进 行 简 单 的 开 采 然 后 输<br />
送 到 选 厂 , 一 旦 有 了 合 适 的 开 采 计 划 和 品 位<br />
控 制 , 我 们 期 待 将 产 量 大 幅 提 升 到 可 能 高 达<br />
25 万 盎 司 。”<br />
Wardrop 公 司 的 评 估 报 告 建 议 进 行 再 做 两<br />
个 阶 段 的 勘 探 以 提 升 和 扩 大 资 源 量 , 第 一 阶<br />
段 重 点 提 高 浅 部 资 源 的 可 信 度 , 第 二 阶 段 重<br />
点 关 注 深 部 成 矿 以 及 深 部 和 沿 走 向 延 伸 的 更<br />
多 资 源 。<br />
Rod Husband 说 :“ 我 们 离 成 为 一 个 完 全 的<br />
生 产 商 仅 有 几 个 月 的 距 离 , 这 真 是 让 人 激<br />
动 , 这 大 部 分 得 益 于 项 目 是 在 中 国 。 这 要 是<br />
在 北 美 完 全 行 不 通 —— 要 等 设 计 报 告 , 获 得<br />
基 建 成 本 然 后 才 能 建 设 选 厂 。”<br />
Report confirms Mei Feng potential<br />
AN independent report commissioned by<br />
China Coal Corporation in relation to its proposed<br />
acquisition of the Mei Feng Coal Project<br />
in Xinjiang province states that Mei Feng<br />
represents a mineable underground deposit<br />
and orderly extraction of the reserve should<br />
proceed as planned.<br />
<strong>The</strong> NI 43-101 Technical Report prepared<br />
by Norwest Corp indicates that there is a resource<br />
on the property worthy of current mining<br />
operations, additional exploration and<br />
further development.<br />
<strong>The</strong> current mine owners have secured all<br />
leases and permits for mining, so the report<br />
states that only maintenance of these is required<br />
in the future. It indicates estimates of required<br />
capital, manpower and equipment for<br />
the surface mine operations are reasonable,<br />
and that projected tonnages are reasonable<br />
based on the reserves associated with the<br />
mine. <strong>The</strong>re are measured and indicated resources<br />
of 18.138 million tonnes and inferred<br />
resources of 892,120 tonnes with potential to<br />
add to this through further exploration. As at<br />
December 16, 2010, the reserve total was<br />
7.692 million tonnes from nine seams. Reserves<br />
are reported on a clean basis rather than a runof-mine<br />
basis because ROM coal is not sold as<br />
a product but further processed to produce a<br />
saleable product suitable for the local market.<br />
China Coal’s chief financial officer Mark<br />
Roth told <strong>The</strong> <strong>ASIA</strong> <strong>Miner</strong> that after listing on<br />
the TSX Venture Exchange in May 2010,<br />
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China<br />
China Coal’s Chinese subsidiary signed an<br />
agreement to acquire 60% of the operating<br />
Mei Feng mine for about 150 million RMB.<br />
He says China Coal then engaged Norwest<br />
to prepare the report and in January this year<br />
formed a Technical Advisory Board to review<br />
operations and acquisitions, and recommend<br />
on safety and expansion projects.<br />
“Construction of an underground mine was<br />
completed last year and a mandatory sixmonth<br />
productivity and safety testing phase<br />
was completed in the third quarter. Mine construction<br />
consists of 6000 metres of tunnels<br />
and initial production from the B3 and B8 metallurgical<br />
coal seams began last September.<br />
“At present annual production is about<br />
300,000 tonnes and China Coal intends to increase<br />
this to 900,000 tonnes.”<br />
Mark Roth says there are two coking plants<br />
within 50km of the mine that require 2.7 million<br />
tonnes of coking coal each year while there are<br />
also three large power plants within 95km that<br />
annually require 6.9 million tonnes of thermal<br />
coal, ensuring strong demand for the coking<br />
and thermal coal found at Mei Feng.<br />
<strong>The</strong> technical report indicates that the<br />
basic coal quality testing parameters are the<br />
same using either the Chinese standards or<br />
ASTM procedures. It also indicates the B8<br />
seam is uniform with relatively complex<br />
structure but mineable in the whole area,<br />
has a true thickness from 1.04 to 5.33 metres<br />
with an average of 3.06 and continuity<br />
is stable. <strong>The</strong> B3 seam is relatively uniform<br />
throughout with simple structure, true thickness<br />
is 1.80 to 5.39 metres with an average<br />
thickness of 3.71 metres and continuity is<br />
relatively stable.<br />
Norwest’s visit to the mine verified that<br />
safety equipment had been installed as recommended<br />
in the feasibility study.<br />
China Coal is focused on acquisition of<br />
existing producing, or formerly producing,<br />
coal mines, properties and related assets in<br />
China. As well as acquiring Mei Feng, the<br />
company is undertaking due diligence on<br />
another two mines being considered as acquisition<br />
targets.<br />
<strong>The</strong> company’s five year objective is annual<br />
production of 5 million tonnes and Mei<br />
Fung will eventually represent almost 20%<br />
of this goal.<br />
报 告 肯 定 美 丰 煤 矿 的 潜 力<br />
中 国 煤 炭 集 团 有 限 公 司 (China Coal Corporation)<br />
委 托 进 行 的 一 份 关 于 新 疆 美 丰 煤 矿<br />
项 目 收 购 的 独 立 报 告 指 出 , 美 丰 煤 矿 是 一 个<br />
可 开 采 的 地 下 矿 床 , 应 按 照 原 定 计 划 有 序 地<br />
进 行 开 采 。<br />
Norwest 公 司 出 具 的 NI 43-101 技 术 报 告 表<br />
明 , 该 矿 的 资 源 值 得 进 行 目 前 的 采 矿 作 业 ,<br />
并 且 值 得 进 行 补 充 勘 探 和 进 一 步 开 发 。<br />
目 前 项 目 业 主 已 获 得 所 有 的 采 矿 租 约 和 许<br />
可 证 , 因 此 报 告 指 出 , 未 来 只 需 要 对 矿 山 设<br />
施 进 行 基 本 的 维 护 保 养 。 报 告 认 为 地 表 开 采<br />
所 需 的 资 金 、 人 力 投 入 和 设 备 配 置 是 合 理<br />
的 , 且 基 于 矿 山 储 量 得 出 的 项 目 矿 石 量 也 是<br />
合 理 的 。<br />
探 明 和 控 制 级 别 资 源 量 是 1813.80 万 吨 ,<br />
推 断 级 别 资 源 量 89.2120 万 吨 , 且 有 进 一 步<br />
通 过 勘 探 工 作 提 升 的 潜 力 。 截 至 2010 年 12<br />
月 16 日 , 九 个 煤 层 的 总 储 量 是 769.2 万 吨 。<br />
且 储 量 估 算 是 按 净 煤 计 算 的 , 而 非 毛 煤 量 ,<br />
因 为 毛 煤 将 不 会 被 直 接 出 售 , 而 是 要 进 一 步<br />
加 工 出 适 合 当 地 市 场 的 可 销 售 产 品 。<br />
中 国 煤 炭 集 团 有 限 公 司 的 首 席 财 务 官 Mark<br />
Roth 告 诉 《 亚 洲 矿 业 》 杂 志 , 公 司 2010 年<br />
5 月 在 多 伦 多 证 券 交 易 所 创 业 板 上 市 后 ,<br />
旗 下 的 中 国 子 公 司 签 署 了 一 份 以 1.5 亿 元<br />
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China<br />
人 民 币 代 价 收 购 正 在 运 营 中 的 美 丰 煤<br />
矿 60% 权 益 的 协 议 。<br />
他 说 , 公 司 随 后 聘 请 了 Norwest 公 司 准 备<br />
相 关 报 告 , 并 在 今 年 1 月 成 立 了 一 个 技 术 咨<br />
询 委 员 会 , 负 责 审 查 项 目 运 作 和 收 购 , 并 为<br />
矿 山 安 全 和 扩 建 提 供 技 术 建 议 。<br />
“ 地 下 矿 井 建 设 已 于 去 年 完 成 , 强 制 性 的<br />
六 个 月 期 生 产 效 率 和 安 全 性 测 试 也 已 第 三 季<br />
度 结 束 。 矿 山 掘 进 了 长 6000 米 的 巷 道 , 首<br />
采 区 的 B3 和 B8 煤 层 冶 金 煤 生 产 于 去 年 九 月<br />
开 始 。<br />
“ 目 前 年 产 量 约 30 万 吨 , 公 司 计 划 提 高 到<br />
90 万 吨 。”<br />
Mark Roth 说 距 离 煤 矿 50 公 里 内 的 两 家 炼<br />
焦 厂 每 年 需 焦 煤 270 万 吨 , 同 时 方 圆 95 公 里<br />
内 还 有 三 家 大 型 火 电 厂 , 年 需 热 煤 690 万 吨<br />
, 保 证 了 美 丰 煤 矿 出 产 的 焦 煤 和 热 煤 有 着 强<br />
劲 的 需 求 。<br />
技 术 报 告 显 示 无 论 是 中 国 还 是 美 国 ASTM<br />
标 准 检 测 程 序 , 煤 炭 质 量 检 测 的 基 本 参 数 都<br />
相 同 。 这 也 意 味 着 B8 煤 层 均 一 性 较 好 , 相<br />
对 结 构 复 杂 但 全 部 可 采 , 真 实 煤 层 厚 度 介<br />
于 1.04 米 到 5.33 米 之 间 , 平 均 3.06 米 , 连 续<br />
性 稳 定 。B3 煤 层 从 头 到 尾 相 对 均 一 , 结 构<br />
简 单 , 真 实 厚 度 介 于 1.80 米 到 5.39 米 之 间 ,<br />
平 均 3.71 米 , 连 续 性 相 对 稳 定 。<br />
Norwest 公 司 的 现 场 考 察 核 实 , 已 按 可 行<br />
性 研 究 建 议 在 矿 井 安 装 了 安 全 设 备 。<br />
中 国 煤 炭 集 团 有 限 公 司 的 业 务 核 心 是 收 购<br />
中 国 国 内 目 前 正 在 生 产 或 曾 经 生 产 的 煤 矿 或<br />
其 他 矿 种 及 其 相 关 资 产 。 除 了 收 购 美 丰 项 目<br />
外 , 该 公 司 正 就 另 外 两 个 收 购 目 标 矿 山 进 行<br />
尽 职 调 查 。<br />
该 公 司 的 五 年 期 目 标 是 年 产 煤 500 万 吨 ,<br />
美 丰 最 终 将 贡 献 这 一 目 标 的 近 20%。<br />
First phase expansion at Pingyao facility<br />
WORK is under way on the first phase expansion<br />
of China Magnesium Corporation’s<br />
Officials from Pingyao County and China Magnesium Corporation at the<br />
ground breaking ceremony for the Pingyao Magnesium Project first phase expansion.<br />
Pingyao Magnesium Project in Shanxi<br />
province. <strong>The</strong> expansion will bring total annual<br />
capacity at the processing facility to<br />
20,000 tonnes.<br />
Earthworks have started after China Magnesium’s<br />
subsidiary CMC China was formally<br />
granted 50 year land use rights for the expansion.<br />
<strong>The</strong> granting of the rights, which cover<br />
60,000 square metres adjacent to the existing<br />
plant, enables CMC China to boost annual<br />
production to 20,000 tonnes by the end<br />
of 2011 and 105,000 tonnes by 2013.<br />
Capital works to upgrade and refurbish the<br />
existing plant began in December 2010<br />
while earthworks on the new land began<br />
after a ground-breaking ceremony in early<br />
March. <strong>The</strong> Pingyao County Government<br />
arranged and hosted the ceremony, which<br />
was attended by Pinhyao Mayor Hui Zhing<br />
Li and more than 100 other officials. <strong>The</strong><br />
Mayor said, “Our government will fully support<br />
your magnesium company because it is<br />
one of the eight key projects in the Shanxi<br />
province and the city’s number one project.”<br />
China Magnesium’s executive director and<br />
chief operating officer Xinping Liang said, “<strong>The</strong><br />
company enjoys a high degree of respect from<br />
the local community and government, and we<br />
are fortunate to have this depth of local support.<br />
Also, we are excited to have reached this<br />
stage in development of the project, for which<br />
both the existing plant upgrade and first phase<br />
expansion are still very much within budget<br />
and on or ahead of time.”<br />
China Magnesium believes it will benefit<br />
from the recent announcement by China’s<br />
Ministry of Industry and Information Technology<br />
of strict new conditions for companies<br />
working within or planning to enter the<br />
magnesium industry in China. <strong>The</strong> conditions<br />
set high standards for the layout, production<br />
capacity and environmental<br />
protection for the industry.<br />
<strong>The</strong> conditions for existing and future magnesium<br />
production facilities are:<br />
• Existing refineries - must have annual production<br />
capacity of at least 15,000<br />
tonnes. If an existing refinery wishes to<br />
apply for renovation or expansion, it will<br />
need to have a production capacity of at<br />
least 20,000 tonnes.<br />
• New refineries - Must have a planned capacity<br />
of at least 50,000 tonnes.<br />
In addition new refining projects will be prohibited<br />
in areas 1km from drinking water<br />
sources, basic farmland protection areas,<br />
natural reserves, scenic spots and other<br />
areas that require strict environmental quality.<br />
China Magnesium’s managing director Tom<br />
Blackhurst says, “China produces more than<br />
80% of the world’s magnesium and a significant<br />
proportion of this is from low capacity<br />
magnesium plants. China Magnesium is in<br />
the enviable position of having permits in<br />
place covering not only the current first phase<br />
expansion to 20,000 tonnes, but for increases<br />
up to 105,000 tonnes.<br />
“<strong>The</strong> conditions are intended to ensure the<br />
industry operates in an efficient and environmentally<br />
responsible manner. It will consolidate<br />
the company’s position as we will be<br />
one of the first producers to meet the new industry<br />
standards through the upgrade of existing<br />
facilities and first phase expansion.”<br />
平 遥 项 目 一 期 扩 建<br />
中 国 镁 业 有 限 公 司 在 山 西 省 平 遥 的 镁 金 属 项<br />
目 开 始 一 期 扩 建 。 此 次 扩 建 将 把 年 生 产 能 力<br />
提 升 至 20000 吨 。<br />
在 中 国 镁 业 的 子 公 司 (CMC 中 国 ) 获 得 第<br />
一 阶 段 扩 建 所 需 的 50 年 土 地 使 用 权 后 , 土<br />
木 工 程 随 即 展 开 。 获 批 的 土 地 使 用 面 积 共 计<br />
6 万 平 方 米 毗 邻 现 有 工 厂 , 扩 建 将 使 CMC(<br />
中 国 ) 的 年 生 产 能 力 在 2011 年 底 之 前 达 到<br />
20000 吨 , 在 2013 年 达 到 105000 吨 。<br />
升 级 和 翻 新 现 有 工 厂 的 基 础 建 设 工 程 已 在<br />
2010 年 12 月 开 始 , 在 2011 年 3 月 份 随 着 奠 基<br />
仪 式 的 举 行 土 木 工 程 建 设 也 随 即 展 开 。 奠 基<br />
仪 式 由 平 遥 县 政 府 主 持 , 包 括 平 遥 县 县 长 李<br />
非 忠 在 内 的 100 余 位 官 员 参 加 了 奠 基 仪 式 。<br />
李 非 忠 说 :“ 我 们 将 全 力 支 持 镁 业 公 司 , 该<br />
项 目 是 山 西 省 八 大 重 点 项 目 之 一 , 也 是 平 遥<br />
县 最 重 要 的 项 目 。”<br />
中 国 镁 业 公 司 总 经 理 和 首 席 运 营 官 梁 新 平<br />
说 :“ 中 国 镁 业 公 司 受 到 了 当 地 政 府 的 高 度<br />
重 视 , 我 们 十 分 幸 运 能 够 获 得 当 地 政 府 如 此<br />
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China<br />
大 的 支 持 。 现 有 设 备 升 级 和 一 期 扩 建 成 本 完<br />
全 在 预 算 当 中 且 在 时 间 上 早 于 预 期 , 我 们 为<br />
目 前 开 发 已 取 得 的 成 绩 欢 欣 鼓 舞 。”<br />
工 业 和 信 息 化 产 业 部 日 前 出 台 新 规 , 对 镁<br />
行 业 业 内 公 司 或 准 备 进 入 镁 行 业 的 公 司 提 出<br />
了 严 格 的 要 求 , 中 国 镁 业 相 信 其 将 从 中 获<br />
益 。 新 规 对 于 镁 的 生 产 设 计 、 生 产 能 力 和 环<br />
境 保 护 设 定 了 很 高 的 标 准 。<br />
新 规 规 定 :<br />
• 已 有 精 炼 厂 — 年 生 产 能 力 必 须 在 15000 吨<br />
以 上 。 若 已 在 产 的 精 炼 厂 申 请 改 扩 建 ,<br />
则 年 生 产 能 力 需 在 20000 以 上 。<br />
• 新 精 炼 厂 — 设 计 年 生 产 能 力 须 在 50000 吨<br />
以 上 。<br />
除 此 之 外 , 新 的 精 炼 厂 项 目 需 建 设 在 水 源<br />
地 、 基 本 农 田 保 护 区 、 自 然 资 源 、 名 胜 地 和<br />
其 他 需 要 严 格 环 境 保 护 的 地 区 1 公 里 之 外 。<br />
澳 大 利 亚 中 国 镁 业 公 司 董 事 汤 姆 :“ 中 国<br />
生 产 了 世 界 上 80% 的 镁 , 这 其 中 很 大 部 分 产<br />
在 低 产 能 的 小 工 厂 。 中 国 镁 业 引 以 为 豪 的 是<br />
我 们 不 仅 被 批 准 进 行 一 期 扩 建 使 生 产 达 到<br />
20000 吨 , 更 会 将 产 能 提 升 至 105000 吨 。”<br />
“ 新 规 的 出 台 旨 在 使 镁 生 产 行 业 在 更 加 有<br />
效 率 、 更 加 环 保 的 状 态 下 运 行 。 通 过 对 已 有<br />
设 施 的 升 级 和 一 期 扩 建 , 我 们 将 成 为 首 批 符<br />
合 新 规 的 企 业 之 一 , 这 将 稳 固 我 们 在 行 业 中<br />
的 地 位 。”<br />
Further expansion plans at Aohanqi<br />
AFTER achieving daily capacity of 500 tonnes<br />
at the Aohanqi Gold Project’s processing<br />
plant, Sino Prosper State Gold Resources<br />
Holdings has confirmed plans to expand capacity<br />
to 2000 tonnes and is ordering equipment<br />
to achieve this. <strong>The</strong> company will also<br />
construct a new refinery with ultimate annual<br />
output capacity in excess of 1 million ounces<br />
of 99.99% pure gold.<br />
<strong>The</strong> Hong Kong listed company purchased<br />
the operating Aohanqi project in Inner Mongolia,<br />
north of the border with Liaoning<br />
province, in 2009 and has significantly expanded<br />
operations along with undertaking<br />
ongoing exploration.<br />
Sino Prosper aims to become a major Chinese<br />
precious metals producer through acquisition<br />
of producing or near production<br />
properties that can result in increasing resources<br />
and production per share.<br />
Since the Aohanqi acquisition Sino Prosper<br />
has installed new processing plant equipment<br />
and accessory equipment, and has completed<br />
the first phase tailing pond. <strong>The</strong> plant<br />
achieved its daily capacity by the end of December<br />
2010 and has operated with lower<br />
initial feed stock grade than planned while a<br />
new headframe was completed, allowing access<br />
to main ore body.<br />
Sino Prosper has reconstructed tunnels<br />
and supporting facilities taking daily mining<br />
capacity from 200 tonnes to about 600<br />
tonnes. New mine construction, including<br />
four new, larger vertical shafts and connecting<br />
tunnels will bring daily mine output capacity<br />
to about 2500 tonnes on completion by<br />
the end of 2011.<br />
<strong>The</strong> company has made plans for an expanded<br />
drilling program during the Northern<br />
Hemisphere spring and summer to advance<br />
the preparation of JORC resource reporting<br />
and to explore new geologic mineralization.<br />
<strong>The</strong> Aohanqi mining area has also been expanded<br />
from the original 2.07sqkm to<br />
2.70sqkm and the company aims to expand<br />
the licence area to 6sqkm.<br />
Sino Prosper is also developing the<br />
Zhongyi–Weiye Heilongjiang Mine, a production-ready<br />
polymetallic gold property in Heilongjiang<br />
province with five exploration<br />
licensed tenements.<br />
Initial exploration work has focused on developing<br />
resources based on the prevailing<br />
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China<br />
relevant Chinese standards with an aim to<br />
obtain conversion of the exploration licenses<br />
covering 364.61sqkm to mining permits<br />
as soon as possible. Sino Prosper<br />
expects to convert first exploration licence<br />
to a mining licence within the current year,<br />
with the objective of the earliest possible initial<br />
production.<br />
敖 汉 旗 项 目 扩 建 计 划<br />
在 敖 汉 旗 金 矿 项 目 选 矿 厂 的 日 处 理 矿 石 能<br />
力 达 到 500 吨 后 , 中 盈 国 金 资 源 控 股 有 限<br />
公 司 确 认 其 计 划 将 日 处 理 能 力 提 升 至 2000<br />
吨 并 正 为 此 订 购 设 备 。 公 司 亦 将 会 为 之 配<br />
套 建 设 一 个 年 生 产 100 万 盎 司 99.99% 纯 金<br />
的 精 炼 厂 。<br />
这 个 在 香 港 上 市 的 公 司 于 2009 年 收 购 了 位<br />
于 内 蒙 古 境 内 、 北 与 辽 宁 省 接 壤 的 敖 汉 旗 项<br />
目 , 并 已 在 继 续 勘 探 该 项 目 的 同 时 极 大 地 对<br />
其 进 行 了 扩 容 。<br />
中 盈 希 望 通 过 收 购 在 产 或 即 将 生 产 的 项 目<br />
来 增 加 其 资 源 和 每 股 生 产 能 力 , 目 标 是 成 为<br />
中 国 主 要 的 稀 有 金 属 生 产 者 。<br />
中 盈 在 收 购 敖 汉 旗 项 目 后 , 已 完 成 新 的 选<br />
矿 设 备 及 附 属 设 备 的 安 装 , 并 完 成 了 第 一 阶<br />
段 尾 矿 库 的 建 设 。 该 选 矿 厂 于 2010 年 12 月<br />
底 前 达 到 了 前 述 的 日 处 理 能 力 且 运 行 中 的 初<br />
始 进 料 等 级 低 于 计 划 , 一 个 可 直 达 主 矿 体 的<br />
竖 井 也 在 同 期 建 成 。 中 盈 已 对 隧 道 和 供 应 设<br />
备 进 行 了 改 造 使 日 处 理 矿 石 能 力 从 200 吨 提<br />
升 至 大 约 600 吨 。 在 2011 年 年 底 之 前 , 包 括<br />
4 个 新 的 更 大 的 垂 直 立 井 和 连 接 隧 道 在 内 的<br />
新 设 施 的 建 成 , 将 会 使 日 处 理 矿 石 能 力 提 升<br />
至 大 约 2500 吨 左 右 。<br />
该 公 司 计 划 于 北 半 球 的 春 季 和 夏 季 开 展 更<br />
大 的 钻 探 项 目 以 加 速 JORC 资 源 报 告 的 准 备<br />
并 勘 探 新 的 成 矿 带 。<br />
敖 汉 旗 矿 区 已 由 2.07 平 方 公 里 扩 大 至 2.70<br />
平 方 公 里 , 公 司 的 目 标 是 将 其 扩 大 致 6 平 方<br />
公 里 。<br />
与 此 同 时 , 中 盈 还 在 开 发 黑 龙 江 中 谊 伟 业<br />
项 目 , 该 多 金 属 矿 位 于 黑 龙 江 省 , 中 谊 项 目<br />
现 持 有 5 个 勘 探 权 矿 区 。 前 期 的 勘 探 工 作 的<br />
重 点 是 按 照 中 国 现 行 的 有 关 标 准 进 行 探 矿 ,<br />
目 的 在 于 尽 快 将 364.61 平 方 公 里 的 探 矿 权 转<br />
化 为 开 采 权 。 中 盈 希 望 在 本 年 度 内 将 第 一 个<br />
矿 区 的 探 矿 权 转 化 为 采 矿 权 , 并 希 望 尽 早 得<br />
到 产 出 。<br />
Silvercorp closes BYP acquisition<br />
SILVERCORP Metals has received the necessary<br />
Chinese government approvals, including<br />
military clearance, to acquire 70% of Yunxiang<br />
Mining Co, a private mining company in Hunan<br />
province and whose primary asset is the BYP<br />
Gold-Lead-Zinc mine 220km southwest of<br />
Changsha. BYP has a mining permit covering<br />
3.67sqkm, a safety production permit and<br />
flotation mill with daily capacity of 400 tonnes.<br />
As a result of the acquisition, Yunxiang is converted<br />
into a Sino-Foreign joint venture company<br />
and Silvercorp has taken control.<br />
Total consideration for the 70% interest is<br />
US$33 million. Silvercorp has paid US$19<br />
million, representing 80% of the required payment<br />
for the share purchase, and is required<br />
to make a US$9 million equity capital investment<br />
to Yunxiang. It will make payment of the<br />
remaining 20% after certain conditions, including<br />
completion of a government tax audit<br />
of Yunxiang, are satisfied.<br />
Silvercorp intends to utilize the flotation mill<br />
to mine and process gold starting from the<br />
2012 financial year, initially focusing on higher<br />
grade materials. Concurrently, it plans to expand<br />
daily mining and milling capacity to<br />
1000 tonnes for 2013 and to 2000 tonnes by<br />
2014 with the latter to include 1000 tonnes<br />
of gold mineralization and 1000 tonnes of<br />
lead-zinc mineralization.<br />
A mineralized sample from<br />
Silvercorp Metals’ TLP project.<br />
A 50,000 metre drilling program has been<br />
planned for BYP with the aim of upgrading current<br />
historical resources and expanding the<br />
mineralization bodies along strike and downdip.<br />
A Canadian engineering firm has been engaged<br />
to complete a NI 43-101 report on the<br />
project and a Chinese engineering firm will be<br />
engaged to design a full plan for mining development<br />
and mill construction. Based on internal<br />
analysis, it is possible that the expansion of<br />
the production and exploration drilling will be financed<br />
by cash flow generated by Yunxiang.<br />
Silvercorp is the largest primary silver producer<br />
in China through the operation of four<br />
silver-lead-zinc mines at the Ying Mining Camp<br />
in Henan province. It is building the GC silverlead-zinc<br />
project in Guangdong province as its<br />
second China production base and foothold,<br />
and this will be followed by the third production<br />
foothold at BYP.<br />
For the nine months ended December 31,<br />
2010, the company mined 466,639 tonnes of<br />
ore, a 43% increase from the same period in<br />
2009. Increased production from the TLP,<br />
HPG, and LM mines contributed to the<br />
record mine production.<br />
During the 2012 financial year which started<br />
on April 1, production from the four Ying<br />
Camp mines is expected to increase to<br />
600,000 tonnes of ore at a grade of 325<br />
grams/tonne silver, 0.4 grams/tonne gold,<br />
6% lead and 1.9% zinc, yielding 5.6 million<br />
ounces of silver, 4000 ounces of gold, and 90<br />
million pounds of lead and zinc. In this period<br />
BYP is expected to mine and mill 130,000<br />
tonnes of ore at a grade of 7 grams/tonne<br />
gold, yielding about 26,000 ounces of gold.<br />
Exploration is ongoing at the Ying projects<br />
with underground drilling discovering 18 new<br />
veins at the TLP Mine and 12 new veins at<br />
the LM Mine with numerous high grade pockets<br />
identified.<br />
完 成 对 BYP 金 - 铅 - 锌 矿 的 收 购<br />
希 尔 威 金 属 矿 业 公 司 对 Yunxiang 矿 业 公 司<br />
70% 股 份 的 收 购 已 获 中 国 政 府 相 关 部 门 批<br />
准 。Yunxiang 矿 业 公 司 是 一 家 位 于 湖 南 省 的<br />
私 营 企 业 , 其 主 要 资 产 为 距 长 沙 西 南 220 公<br />
里 的 BYP 金 - 铅 - 锌 矿 。<br />
BYP 拥 有 3.67 平 方 公 里 的 探 矿 权 , 安 全 生<br />
产 许 可 和 一 座 日 处 理 能 力 400 吨 的 浮 选 厂 。<br />
收 购 完 成 后 ,Yunxiang 矿 业 公 司 的 企 业 性 质<br />
变 为 中 外 合 资 , 希 尔 威 公 司 拥 有 控 制 权 。<br />
该 70% 股 权 的 收 购 价 格 为 3300 万 美 元 。 希<br />
尔 威 已 支 付 1900 万 美 元 , 占 收 购 股 份 所 需<br />
支 付 额 的 80%, 并 将 支 付 900 万 美 元 作 为<br />
Yunxiang 矿 业 公 司 股 东 权 益 。 剩 余 的 20% 将<br />
会 在 特 定 事 项 完 成 后 支 付 , 其 中 包 括 政 府 对<br />
Yunxiang 矿 业 公 司 的 税 务 审 计 。<br />
希 尔 威 公 司 计 划 于 2012 财 年 将 浮 选 磨 机 用<br />
于 金 矿 的 开 采 和 遴 选 , 初 期 主 要 用 于 高 品 位<br />
矿 石 。 同 时 , 该 公 司 计 划 在 2013 年 提 高 日<br />
开 采 和 研 磨 能 力 至 1000 吨 , 在 2014 年 提 高<br />
至 2000 吨 , 其 中 处 理 金 矿 石 1000 吨 , 铅 - 锌<br />
矿 石 1000 吨 。<br />
一 个 针 对 BYP 矿 的 50000 米 钻 探 计 划 已 被<br />
制 定 , 目 的 在 于 升 级 历 史 资 源 和 延 成 矿 带 以<br />
及 向 下 拓 展 矿 化 体 。<br />
一 个 来 自 加 拿 大 的 工 程 公 司 将 完 成 NI 43-<br />
101 报 告 , 而 一 个 来 自 中 国 的 工 程 公 司 将 为<br />
采 矿 的 开 发 和 研 磨 的 建 造 设 计 总 体 方 案 。 根<br />
据 内 部 消 息 , 生 产 扩 建 和 钻 探 所 需 的 资 金 将<br />
由 Yunxiang 矿 业 筹 集 。<br />
通 过 在 河 南 省 的 Ying 矿 区 运 营 4 个 银 - 铅 - 锌<br />
矿 , 希 尔 威 成 为 了 中 国 最 大 的 原 生 白 银 生 产<br />
商 。 其 正 在 广 东 省 建 造 GC 银 - 铅 - 锌 项 目 作<br />
为 其 在 中 国 的 第 二 个 生 产 基 地 和 立 足 点 ,<br />
BYP 矿 将 是 第 三 个 。<br />
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2010 年 后 9 个 月 , 该 公 司 共 开 采 466,639 吨<br />
矿 石 , 与 2009 年 同 期 相 比 增 长 43%。 这 些<br />
增 长 主 要 来 自 TLP, HPG, 和 LM 矿 的 增 产 。<br />
4 月 1 日 开 始 的 2012 财 年 ,Ying 矿 区 的 4 个<br />
银 - 铅 - 锌 矿 开 采 的 矿 石 量 预 计 将 增 值 600000<br />
吨 , 其 中 银 325 克 / 吨 , 金 0.4 克 / 吨 ,6% 的<br />
铅 和 1.9% 的 锌 , 将 产 出 560 万 盎 司 的 银 ,<br />
4000 盎 司 的 金 和 9000 万 磅 的 铅 和 锌 。 同 期<br />
BYP 矿 计 划 开 采 和 研 磨 130000 吨 的 矿 石 ,<br />
其 中 金 的 品 位 为 7 克 / 吨 , 将 产 出 26000 盎 司<br />
的 金 。<br />
Ying 矿 区 的 勘 探 工 作 仍 在 进 行 中 , 通 过 地<br />
下 钻 探 , 在 TLP 矿 共 发 现 18 条 新 的 矿 脉 , 在<br />
LM 矿 发 现 12 条 矿 脉 , 以 及 为 数 众 多 的 高 品<br />
位 矿 囊 。<br />
Blackgold acquires WuShan mine<br />
CHINESE coal mining company Blackgold International<br />
Holdings has made its first acquisition<br />
since its February ASX listing with the<br />
purchase of a Chinese coal mine for RMB 80<br />
million (about Aus$12 million). It has entered<br />
into a Heads of Agreement to buy Chongqing<br />
Yihua Mining, owner of the WuShan mine in<br />
Wushan county, Chongqing province in<br />
south-west central China.<br />
<strong>The</strong> acquisition is subject to a satisfactory<br />
due diligence being completed, as well as<br />
being subject to the execution of a final<br />
agreement in accordance with Chinese law<br />
and securing the necessary approvals from<br />
the relevant Chinese authorities.<br />
Blackgold's chairman James Tong says the<br />
WuShan acquisition is in line with the expansion<br />
plans articulated in the company's ASX<br />
prospectus and should have two benefits for<br />
the company.<br />
“WuShan is anticipated to represent nearterm<br />
production that will significantly increase<br />
Blackgold’s annual coal production volume,<br />
and additional exploration and evaluation at<br />
the WuShan mine by a JORC qualified independent<br />
geologist is proposed and is expected<br />
to allow for an increase in Blackgold’s<br />
JORC assessed resources.<br />
WuShan is a highly developed, pre-production<br />
thermal coal mine about 20km from<br />
Blackgold’s existing operations. <strong>The</strong> mine<br />
contains five existing production adits together<br />
with ventilation and access shafts and<br />
ancillary infrastructure including power, piped<br />
water, access roads and buildings.<br />
WuShan is close to river port loading facilities<br />
and has historically supplied small quantities<br />
of thermal coal. Blackgold anticipates<br />
commercial coal production beginning immediately<br />
after machinery and equipment are installed<br />
and commissioned and expects that<br />
this will occur within four months of the acquisition<br />
being finalized.<br />
黑 金 环 球 收 购 巫 山 煤 矿<br />
在 2 月 份 登 陆 澳 大 利 亚 证 券 交 易 所 后 , 中 国<br />
煤 矿 公 司 黑 金 环 球 控 股 以 8000 万 元 人 民 币 (<br />
大 约 1200 万 澳 元 ) 的 价 格 收 购 了 一 个 中 国 的<br />
煤 矿 。 黑 金 环 球 已 缔 结 收 购 重 庆 宜 化 矿 业 有<br />
限 公 司 ( 巫 山 煤 矿 的 所 有 者 ) 股 权 的 协 议 。<br />
巫 山 煤 矿 位 于 中 国 西 南 部 重 庆 市 巫 山 县 。<br />
本 次 收 购 涉 及 已 完 成 的 令 人 满 意 的 尽 职 调<br />
查 , 且 按 照 中 国 的 相 关 法 律 和 有 关 当 局 的 批<br />
文 。 执 行 最 终 协 议 。<br />
黑 金 主 席 唐 志 浩 先 生 表 示 , 收 购 巫 山 煤<br />
矿 , 与 招 股 书 中 说 明 的 扩 展 计 划 一 致 , 将 为<br />
公 司 带 来 两 大 好 处 : 巫 山 煤 矿 若 可 近 期 投<br />
入 生 产 , 将 使 黑 金 的 煤 炭 年 产 量 出 现 显 著 增<br />
长 , 联 合 矿 石 储 量 委 员 会 的 独 立 地 质 学 家 对<br />
巫 山 煤 矿 进 行 额 外 的 勘 探 和 评 估 , 预 计 会 增<br />
加 黑 金 符 合 评 估 标 准 的 资 源 。<br />
巫 山 煤 矿 是 一 家 发 展 动 力 煤 前 期 作 业 的 煤 矿<br />
, 距 离 黑 金 目 前 的 两 个 煤 矿 20 公 里 内 。 煤<br />
矿 包 含 5 个 生 产 入 口 , 连 同 其 风 井 和 竖 井 通<br />
道 , 和 所 有 辅 助 性 基 础 设 施 , 如 : 电 力 , 自<br />
来 水 , 通 路 和 相 关 建 筑 都 已 建 好 。<br />
巫 山 煤 矿 距 离 货 运 码 头 很 近 , 该 码 头 之 前 曾<br />
装 载 运 输 过 少 量 的 热 煤 。 一 旦 安 装 , 调 试 好<br />
机 器 设 备 , 就 可 立 即 作 业 , 投 入 生 产 。 巫 山<br />
煤 矿 将 在 收 购 完 成 后 4 个 月 内 投 入 生 产 。<br />
May/June 2011 | <strong>ASIA</strong> <strong>Miner</strong> | 51
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Philippines<br />
ALLIANCE PLANS COUNTRY’S SECOND NICKEL PLANT<br />
THE alliance between Sumitomo Metal Mining<br />
and Nickel Asia Corp will spend US$1.4<br />
billion to build a second nickel processing<br />
plant in the province of Surigao del Norte.<br />
Sumitomo will have about a 55% stake in the<br />
project and Nickel Asia about 22.5% with the<br />
rest of the shares divided under a joint venture<br />
company called THPAL Corp.<br />
Nickel Asia’s president and CEO Gerard<br />
Brimo says construction of the country’s second<br />
downstream nickel processing plant will<br />
start this year and take two years to complete.<br />
“We expect to finish the project in the<br />
middle of 2013.”<br />
<strong>The</strong> plant will be constructed adjacent to the<br />
nickel mine of Nickel Asia subsidiary Taganito<br />
Mining Corp, which will supply the plant's required<br />
nickel ore over an estimated 30-year<br />
period. Sumitomo will purchase the output of<br />
the plant, a mixed nickel-cobalt sulphide, for<br />
final processing at its refinery in Japan.<br />
<strong>The</strong> Taganito plant will use high-pressure<br />
acid leach (HPAL) technology, which employs<br />
low-grade laterite ores, which previously were<br />
usually abandoned, to produce nickel.<br />
Sumitomo, which is Japan’s top nickel producer,<br />
also intends to spend US$168 million<br />
to beef up capacity at a Japanese nickel refinery<br />
to handle raw metal produced at the<br />
Taganito project. It plans to increase annual<br />
refining capacity at its Niihama plant to<br />
65,000 tonnes in the 2013/14 financial year<br />
from the current 41,000 tonnes. <strong>The</strong> expansion<br />
work is expected to be completed in the<br />
first quarter of 2013.<br />
<strong>The</strong> new Taganito processing plant is also<br />
considered particularly beneficial to the Philippines<br />
because of the value-added created by<br />
the downstream mineral processing plant, including<br />
14,000 jobs and an increase in the<br />
country's foreign exchange reserves.<br />
Gerard Brimo says the new plant will have a<br />
capacity more than three times that of the first<br />
plant under Coral Bay Nickel Corp, a joint venture<br />
between a Japanese consortium led by<br />
Sumitomo and Rio Tuba Nickel Mining Corp,<br />
which is another Nickel Asia subsidiary.<br />
Constructed adjacent to the operations of<br />
Rio Tuba in southern Palawan, the first plant<br />
became operational in 2005 and has been a<br />
technical and commercial success. Its initial annual<br />
capacity of 10,000 tonnes of nickel metal<br />
equivalent has since been more than doubled.<br />
Sumitomo has recently introduced new equipment<br />
at the Coral Bay HPAL plant, upgrading<br />
annual capacity by 10% to 24,000 tonnes.<br />
New drilling program at Alpha<br />
MBMI Resources has started an 8000 metre<br />
drill program on the Alpha Nickel Project in<br />
Palawan focusing on detailed mine planning<br />
as well as exploration beyond the limits of the<br />
60 hectare area previously permitted.<br />
<strong>The</strong> drilling contractor's 11 tungsten-carbide<br />
core drill rigs and associated equipment<br />
arrived at the Alpha project site at the end of<br />
March, were mobilized to target areas and<br />
began drilling on the property on April 9.<br />
<strong>The</strong> 8000 metre drill program is the first<br />
phase of a much larger program. Past exploration<br />
activities have identified accessible highgrade,<br />
exposed nickel and chrome materials<br />
zones within the 3200 hectare property.<br />
<strong>The</strong> majority of the drilling will focus on<br />
grade control to identify and confirm detailed<br />
data required to expand and define high priority<br />
areas for continued mining. <strong>The</strong> grade<br />
control holes will be completed to a maximum<br />
depth of 15 metres and drilled on a 15<br />
metre by 15 metre spacing.<br />
<strong>The</strong> remainder of the program will consist<br />
of exploration holes drilled to a maximum<br />
depth of 25 metres on a 50 metre by 50<br />
metre spacing focused in an area where<br />
mapping and test pitting have shown highly<br />
prospective results. <strong>The</strong>se exploration holes<br />
will be outside the boundary of the 60 hectare<br />
area previously explored and will expand currently<br />
delineated areas to confirm sufficient resources<br />
for future development operations.<br />
MBMI’s president and director Michael<br />
Mason says, “This first phase of drilling is designed<br />
as an intensive and systematic exploration<br />
program to develop and confirm results<br />
to expand the independent mineral resource<br />
on Alpha. In addition, the grade control drilling<br />
will provide the company and our partners<br />
with the required data to continue mining and<br />
development of this project.”<br />
MBMI is focused on the exploration and development<br />
of nickel properties and with its<br />
Philippine partners maintains a Financial or<br />
Technical Assistance Agreement (FTAA) with<br />
the Philippine government with respect to the<br />
Alpha, Bethlehem and Rio Tuba properties.<br />
<strong>The</strong> FTAA allows MBMI and its partners to<br />
progress toward development of full-scale<br />
operational programs at each property.<br />
A stockpile of ore at MBMI’s Alpha Nickel Project in Palawan.<br />
54 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Philippines<br />
<strong>The</strong> Agsao shaft at Medusa’s Co-O Gold Project on Mindanao.<br />
<strong>The</strong> company is using funds raised in recent<br />
private placements and financing arrangements<br />
to accelerate exploration at Alpha and<br />
Bethlehem. A $3.8 million placement in March<br />
which increased Gwynneth Gold’s stake in<br />
MBMI to 12.7%, a $5.8 million private placement<br />
in February and the securing of a $7 million<br />
pre-advance payment in late November<br />
have boosted the company’s finances.<br />
Exceptional Co-O gold assays<br />
EXCEPTIONAL assay results are being obtained<br />
by Medusa Mining from a new wide,<br />
sub-vertical, high grade zone within the mine at<br />
the Co-O Gold Project. <strong>The</strong> underground drilling<br />
has returned 13.10 metres @ 47.81 grams/<br />
tonne gold, 9.65 metres @ 12.58 grams/tonne<br />
and 4.8 metres @ 13.84 grams/tonne.<br />
Surface drilling in and around the mine has<br />
also provided strong results including 2 metres<br />
@ 219.17 grams/tonne, 0.8 metres @ 42.33<br />
grams/tonne, 1 metre @ 31.45 grams/tonne<br />
and 1.15 metres @ 12.49 grams/tonne.<br />
A recent assessment of the Co-O Mine vein<br />
architecture by independent structural geology<br />
consultants described strong similarities of the<br />
vein system structure and aerial extent to the<br />
Martha Mine epithermal vein system in New<br />
Zealand which produced about 5.6 million<br />
ounces of gold from the 1870s to 1952 and<br />
was mined to around 600 metres in depth.<br />
Medusa’s managing director Geoff Davis<br />
says, “<strong>The</strong> continuing good results from the<br />
Co-O vein system and surrounds are extremely<br />
pleasing, including the discovery of a<br />
new exceptionally wide and high grade zone<br />
within the mine by underground drilling.<br />
“I also wish to emphasise that, as we drill new<br />
vein systems, drill intersections in veins rarely<br />
provide ore-grade intersections in every hole.<br />
As our data base grows, and the characteristics<br />
of each vein become clearer, statistical assessment<br />
of the percentage of ore-grade drill<br />
hole intersections required, maybe as low as<br />
40% of holes with ore grade intersections, will<br />
increasingly provide the levels of certainty for<br />
turning exploration drill results into ore that can<br />
be developed with confidence.”<br />
Medusa is confident that the ongoing exploration<br />
can provide additional ore for the Co-O<br />
processing plant, thus increasing the mine life.<br />
<strong>The</strong> revised forecast gold production for the<br />
fiscal year to June 30, 2011, is now a record<br />
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Philippines<br />
102,000 ounces at anticipated cash costs of<br />
US$190 per ounce. Geoff Davis says, “I am<br />
pleased to report that operations have continued<br />
smoothly with the company achieving<br />
record production at the low average cash<br />
cost of US$186 per ounce for the first six<br />
months of the financial year.”<br />
Mine development is continuing with the<br />
sinking of the Saga Shaft under way and the<br />
start of a new adit to access the Royal Veins<br />
and the newly discovered North Tinago vein<br />
systems. Late last year the company’s Board,<br />
approved construction of a new Co-O plant<br />
with capacity to annually produce 200,000.<br />
Capital requirements of the plant, including<br />
mine development, are estimated at US$80<br />
million and will be funded out of cashflow. <strong>The</strong><br />
preliminary construction schedule after regulatory<br />
permitting is estimated to be 21 months.<br />
Medusa is currently advancing the permitting<br />
process and is engaged in discussions with<br />
engineering design and construction groups.<br />
Royalco attracts new investor<br />
MICROCAP investment manager Acorn Capital<br />
has taken a 19% stake in Australia-based<br />
Philippine explorer Royalco Resources. <strong>The</strong><br />
change occurred earlier in the year after South<br />
Australian focused copper and gold miner OZ<br />
<strong>Miner</strong>als offloaded its 18.97% stake in Royalco.<br />
Apart from its Philippines exploration interests,<br />
Royalco holds a portfolio of 10 royalty interests<br />
in mines around the world of which two<br />
have been producing income in recent times.<br />
Royalco is currently deriving most of its income<br />
from a royalty on the Globe-Progress<br />
gold mine at Reefton in New Zealand. It is<br />
also considering other project opportunities<br />
in South East Asia, including Cambodia.<br />
During the December quarter the royalty<br />
payment from Globe-Progress was 1250<br />
ounces of gold which equates to about<br />
Aus$5.9 million on an annual basis for this net<br />
royalty income. <strong>The</strong> company expects the<br />
number of producing royalties to increase to<br />
four in coming months.<br />
Acorn Capital is now Royalco’s second<br />
largest shareholder, behind Anglo Pacific<br />
Group which holds a 31.1% stake.<br />
Royalco’s executive chairman Peter Topham<br />
says OZ <strong>Miner</strong>als has been a supporter in recent<br />
years and that ‘corporate paths’ may<br />
cross in future in the “same professional manner<br />
in which it has in the past”. He says, “This<br />
transaction will also potentially benefit shareholders,<br />
as it should assist in adding greater<br />
liquidity to trading in our shares on the Australian<br />
Securities Exchange.”<br />
Royalco has executed an option agreement<br />
with Vale International over its Gambang tenement<br />
in northern Luzon and is also seeking<br />
interest for its Pao Yabbe project which adjoins<br />
OceanaGold’s Didipio Copper-Gold<br />
Project, also in northern Luzon.<br />
Rain delays Siana progress<br />
HEAVY rain in northern Mindanao has delayed<br />
construction progress at Red 5’s Siana<br />
Gold Project. Rainfall in the Siana area for the<br />
first 12 weeks of 2011 totalled 3.5 metres,<br />
which was 203% above average.<br />
<strong>The</strong> rain postponed the major crusher and<br />
SAG mill concrete pours, putting the work<br />
eight weeks behind schedule. <strong>The</strong> company<br />
will forecast a revised inaugural gold pour<br />
date once the major concrete pours have<br />
been completed, cured and certified. <strong>The</strong> targeted<br />
date had been early May.<br />
<strong>The</strong> rain has been so heavy at times that pit<br />
dewatering was temporarily suspended on<br />
several occasions due to the large volume<br />
and velocity of water in the adjacent river systems.<br />
<strong>The</strong> mining pre-strip has been progressing,<br />
although the rain postponed<br />
activities in areas requiring narrower working<br />
widths due to safety reasons.<br />
It also caused a temporary suspension of<br />
drilling at the Mapawa site for safety reasons<br />
due to mudslides and the inability to maintain<br />
a continuous supply of consumables to the<br />
three rigs. Analytical results have, however<br />
been received for a number of holes and include<br />
37 metres @ 3.0 grams/tonne gold.<br />
<strong>The</strong> company has advanced the Siana project<br />
where possible during this period. Grid<br />
power has been connected and reticulated<br />
on site while concrete foundations for all six<br />
CIL tanks and the cyanide detox plant have<br />
been completed.<br />
Formwork and rebar for the crusher and SAG<br />
mill are complete, all major equipment items<br />
such the SAG mill, rolls crusher, apron feeder<br />
and cyclone nest as have been manufactured<br />
and are awaiting delivery to the site, all offsite<br />
steelworks and plateworks are on schedule,<br />
the electrical and pipe work packages have<br />
been released, and 75% of the capital cost is<br />
now under firm orders/contracts.<br />
Red 5 has agreed to a US$8 million<br />
standby credit facility with Sprott Resource<br />
Lending Partnership, which replaces the previously<br />
announce US$25 million gold prepay<br />
with Sprott Group. <strong>The</strong> facility is for 24<br />
months and amounts drawn may be repaid<br />
early with no penalty.<br />
<strong>The</strong> Siana mine build, together with working<br />
capital requirements and exploration programs,<br />
is fully funded to production status,<br />
however, the company’s Board believed it<br />
prudent to guarantee access to additional<br />
funding in light of the continued heavy rains<br />
and due to recent global events.<br />
Existing treasury funds total Aus$67.7 million<br />
with a further Aus$51.4 million forecast<br />
to be invoiced on the Siana build which would<br />
bring the capital cost to first gold pour to<br />
US$78.2 million.<br />
<strong>The</strong> layout of Red 5’s Siana Gold Project in northern Mindanao.<br />
56 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
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Philippines<br />
Masbate continues to set records<br />
GOLD production and throughout continue<br />
to increase at CGA Mining’s flagship Masbate<br />
Gold Project, which is now the largest operating<br />
gold project in the Philippines. CGA is<br />
also well along the path to expanding production<br />
at the project and is acquiring additional<br />
interests throughout the country.<br />
During the December quarter production increased<br />
4% on the previous quarter to 50,330<br />
ounces while mill throughput rose 7% to 1.5<br />
million tonnes of ore. It was the seventh consecutive<br />
quarter of increased gold production.<br />
In the first year of operations, the project produced<br />
in excess of 150,000 ounces of gold.<br />
Masbate is currently forecast to produce<br />
200,000 gold ounces each year and has a<br />
probable reserve of 3.03 million gold ounces.<br />
<strong>The</strong> company is focused on completing the<br />
plant investment program of US$15 million<br />
designed to upsize the existing plant and lock<br />
in a sustainable annual throughput level of 6.5<br />
million tonnes. In line with this expansion CGA<br />
has placed orders for a supplementary crushing<br />
circuit handling 400 tonnes each hour.<br />
This is designed to ensure the 6.5 million<br />
<strong>The</strong> processing plant at CGA Mining’s Masbate<br />
Gold Project on Masbate Island.<br />
tonne throughputs are achieved when the ore<br />
blend becomes harder. Initial construction for<br />
the upgrade has begun.<br />
CGA is also committed to a US$10 million<br />
exploration program this year with a focus on<br />
materially enhancing the reserve and resource<br />
base of Masbate.<br />
In April 2010, CGA’s Philippine subsidiary<br />
Filminera was granted a 52sqkm exploration<br />
permit adjacent to the project, which covers<br />
a number of known and previously mined<br />
gold deposits as<br />
well as hosting a<br />
significant geophysical<br />
anomaly<br />
with a signature<br />
similar to Masbate’s<br />
Main Vein<br />
deposit. <strong>The</strong> permit<br />
has not benefited<br />
from modern<br />
or systematic exploration<br />
and is considered<br />
highly prospective with potential to<br />
materially increase resources.<br />
<strong>The</strong> 2011 exploration program is initially focused<br />
on three broad target areas - near mine<br />
infill drilling to upgrade inferred material to indicated<br />
status; near mine step out drilling to<br />
extend the ore model beneath and along<br />
strike of current information; and exploration<br />
of the new tenement in areas of known mineralization<br />
and those previously unexplored.<br />
It follows the most recent drilling campaign<br />
comprising 9401 metres of reverse circulation<br />
drilling and 2383 metres of diamond core<br />
drilling. Significant intersections include 4 metres<br />
at 8.99 grams/<br />
tonne gold, 6 metres<br />
@ 3.37 grams/<br />
tonne; 9 metres @<br />
3.41 grams/tonne<br />
and 3 metres at<br />
9.63 grams/tonne.<br />
In line with its<br />
strategic alliance<br />
with Ratel Group,<br />
CGA will also continue<br />
to work with<br />
the company to assist in progressing and<br />
enhancing the value of the King-king Gold<br />
Project on Mindanao.<br />
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Australia<br />
SWEET RESULTS FROM BAUXITE DRILLING AT BINJOUR<br />
DRILLING by Australian Bauxite Ltd at the<br />
Binjour project in central Queensland has<br />
returned exceptionally high quality intercepts<br />
of bauxite suitable for sweetening circuits<br />
in refineries. Eleven of 14 holes drilled<br />
intersected very high quality thick bauxite,<br />
significantly advancing the company’s exploration<br />
knowledge.<br />
<strong>The</strong> results at Binjour, which is between<br />
Australian Bauxite’s extensive tenements are in eastern Australia.<br />
the towns of Gayndah and Mundubbera,<br />
south of the port of Gladstone, suggest relatively<br />
pure gibbsite bauxite.<br />
Australian Bauxite’s CEO Ian Levy says,<br />
“Binjour may prove to be a very high quality<br />
bauxite deposit, shippable in large tonnages<br />
to a number of bauxite/alumina refineries that<br />
need ‘sweetener-grade’ bauxite that can be<br />
processed at low temperature and with exceptionally<br />
low reactive silica contents.<br />
“We’ve called this bauxite type ‘Brown<br />
Sugar’ bauxite – which may become a<br />
brand name in the industry one day. Some<br />
customers may become dependent on this<br />
product and pay quite handsomely for it.”<br />
<strong>The</strong> company will target its 2011 drilling<br />
program at areas where the bauxite layer is<br />
at the surface.<br />
At the Taralga prospect in the Southern<br />
Highlands of New South Wales, bauxite resources<br />
totalling 12 million tonnes were<br />
identified in late 2010 from first pass drilling.<br />
More than half of the resources are easily<br />
mine direct shipping ore (DSO) grade bauxite<br />
suitable for direct shipping to customers<br />
requiring gibbsite-rich bauxite, which is the<br />
premium quality bauxite that is in highest<br />
demand globally.<br />
<strong>The</strong> bulk of these resources came from two<br />
areas in the central north of the Taralga tenement<br />
but a new bauxite deposit has been discovered<br />
in the southeast of the tenement and<br />
this is now being drilled as a matter of priority.<br />
During the January drilling cycle 225 holes<br />
were drilled in this area and some zones of<br />
exceptionally thick bauxite layers were discovered,<br />
including one hole that intersected<br />
bauxite from surface to 18 metres depth.<br />
This deposit extends westwards from the<br />
original exploration licence into a newly<br />
granted licence area where 20 of the 225<br />
holes were drilled within 14 days of it being<br />
granted. <strong>The</strong> new deposit appears significantly<br />
larger than the other two deposits,<br />
both in thickness and areal extent.<br />
Australian Bauxite has also been drilling on<br />
its Tasmanian tenement on grazing and cropping<br />
farmland around Campbell Town in the<br />
state’s midlands. Bauxite has been encountered<br />
in drill holes and in surface sampling.<br />
Results to date are from the edges of the<br />
deposit and from some outlier occurrences<br />
of bauxite and they demonstrate that DSO<br />
grades occur in reasonable thicknesses. An<br />
application for a further tenement in Tasmania<br />
has also been lodged.<br />
<strong>The</strong> company holds the core of the newly<br />
discovered eastern Australia bauxite<br />
province with 32 different tenements in<br />
Queensland, New South Wales and Tasmania<br />
covering 7537sqkm.<br />
58 | <strong>ASIA</strong> <strong>Miner</strong> | May/June 2011
News 3_<strong>Layout</strong> 1 4/21/11 2:45 PM Page 59<br />
Australia<br />
MOU for Mt Peake project<br />
TNG Limited has signed a Memorandum of Understanding<br />
with a Chinese state-owned engineering,<br />
development and construction<br />
company to establish a strategic partnership for<br />
financing and development of the Mount Peake<br />
Iron-Vanadium Project in the Northern Territory.<br />
<strong>The</strong> MOU allows for potential future agreement<br />
to undertake engineering, procurement<br />
and construction works and securing<br />
project finance, subject to entering into definitive<br />
agreements. <strong>The</strong> MOU is conditional<br />
on successful evaluation of the recent<br />
Mount Peake scoping study.<br />
<strong>The</strong> non-binding MOU follows a recent positive<br />
independent study based on TNG’s revolutionary<br />
new patented hydrometallurgical<br />
process. This was developed by TNG in conjunction<br />
with its metallurgical consultants <strong>Miner</strong>als<br />
Engineering Technical Services (METS)<br />
and has been successful in recovering three<br />
principal commodities – vanadium, titanium<br />
and iron – from samples of Mount Peake ore.<br />
<strong>The</strong> Chinese group, which has requested<br />
anonymity as part of the MOU, is reviewing<br />
the study and other project information, and<br />
subject to a satisfactory review, the two parties<br />
will sign potential agreements regarding<br />
off-take of the iron and vanadium products,<br />
project construction and funding.<br />
<strong>The</strong> study outlines a mine life of more than<br />
23 years with life-of-mine production of<br />
107.1 million tonnes for total metal production<br />
of 349,000 tonnes of vanadium, 27.182<br />
million tonnes of iron and 6.463 million<br />
tonnes of titanium.<br />
TNG has appointed engineering firm Sinclair<br />
Knight Mertz (SKM) to manage completion<br />
of a pre-feasibility study (PFS) which will<br />
build on the scoping study. <strong>The</strong> PFS is expected<br />
to take seven months and will be<br />
based on a conventional open pit mining operation<br />
annually processing 5 million tonnes.<br />
It will be carried out in conjunction with the<br />
next phase of pilot plant metallurgical test<br />
work, which is testing commercialization of<br />
the patented metallurgical process.<br />
<strong>The</strong> PFS will pave the way for a definitive feasibility<br />
study next year on potential commercial<br />
development options for the project as the<br />
foundation for a long-life, world-scale ferrous<br />
metal business in the Northern Territory.<br />
TNG’s chief executive Paul Burton says the<br />
company is building a highly capable team to<br />
progress the project. “As part of this team we<br />
are pleased to have secured the services of<br />
SKM and will retain the services of Snowden for<br />
resource evaluation and mining advice, as well<br />
as joint patent owners METS for continued metallurgical<br />
evaluation and process development.”<br />
He says TNG recently completed a $2.8<br />
million capital raising to underpin completion<br />
of the PFS, including delivery of a resource<br />
upgrade, pilot plant metallurgical<br />
work and associated studies on the hydrometallurgical<br />
process.<br />
Peake 山 项 目 谅 解 备 忘 录<br />
TNG 有 限 公 司 与 一 家 中 国 国 有 工 程 、 开 发 和<br />
建 设 公 司 签 署 了 一 份 谅 解 备 忘 录 , 就 合 作 融<br />
资 并 开 发 北 领 地 Peake 山 铁 钒 项 目 建 立 起 战<br />
略 伙 伴 关 系 。<br />
该 谅 解 备 忘 录 为 今 后 的 项 目 设 计 、 采 购 、<br />
施 工 合 同 以 及 项 目 融 资 留 有 了 空 间 , 但 须 取<br />
决 于 签 订 确 定 性 协 议 。 该 谅 解 备 忘 录 是 有 条<br />
件 的 , 即 需 成 功 进 行 对 Peake 山 概 略 研 究 的<br />
评 价 。<br />
这 份 不 具 约 束 力 的 谅 解 备 忘 录 是 在 针 对<br />
TNG 公 司 一 项 革 命 性 的 湿 法 冶 金 工 艺 新 专 利<br />
做 出 独 立 积 极 研 究 后 签 署 的 。 这 项 专 利 由<br />
TNG 公 司 与 其 冶 金 顾 问 矿 物 工 程 技 术 服 务 公<br />
May/June 2011 | <strong>ASIA</strong> <strong>Miner</strong> | 59
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Australia<br />
司 (METs) 合 作 开 发 的 , 并 已 在 从 Peake 山<br />
矿 样 中 提 取 三 种 主 要 金 属 时 取 得 成 功 ——<br />
钒 、 钛 和 铁 。<br />
中 方 合 作 伙 伴 要 求 在 该 谅 解 备 忘 录 中 匿 名<br />
出 现 , 正 在 审 查 项 目 概 略 研 究 以 及 其 他 信 息<br />
, 若 审 查 结 果 令 人 满 意 , 双 方 将 签 署 有 关 铁<br />
和 钒 产 品 的 包 销 、 项 目 建 设 以 及 融 资 合 同 。<br />
项 目 概 略 研 究 预 计 矿 山 寿 命 超 过 23 年 , 共<br />
计 矿 石 产 量 将 达 1.071 亿 吨 , 包 括 34.9 万 吨<br />
钒 ,2718.2 万 吨 铁 和 646.3 万 吨 钛 。<br />
TNG 公 司 已 委 任 工 程 公 司 Sinclair Knight<br />
Mertz (SKM) 负 责 在 概 略 研 究 基 础 上 完 成 预<br />
可 行 性 研 究 报 告 (PFS)。 预 计 需 要 7 个 月<br />
时 间 , 假 设 前 提 是 传 统 的 露 天 开 采 , 年 处 理<br />
量 500 万 吨 。 这 项 工 作 将 与 下 阶 段 的 中 试 厂<br />
冶 金 试 验 工 作 同 时 进 行 , 主 要 是 验 证 专 利 冶<br />
金 工 艺 的 商 业 化 运 作 。<br />
该 可 行 性 研 究 将 为 明 年 的 最 终 可 行 性 铺 平<br />
道 路 , 着 眼 于 可 能 采 取 的 商 业 化 项 目 开 发 方<br />
案 , 目 标 是 使 项 目 成 为 北 领 地 地 区 一 个 世 界<br />
级 的 长 寿 命 黑 色 金 属 项 目 。<br />
TNG 公 司 的 首 席 行 政 官 Paul Burton 说 , 该<br />
公 司 正 在 建 立 一 个 精 干 的 团 队 推 进 项 目 进<br />
展 。“ 作 为 这 个 团 队 的 一 部 分 , 我 们 很 高 兴<br />
已 经 获 得 了 来 自 SKM 的 服 务 , 并 会 聘 请<br />
Snowden 公 司 进 行 资 源 评 价 和 开 采 建 议 , 以<br />
及 专 利 的 共 同 拥 有 者 METs 公 司 继 续 进 行 冶<br />
金 学 评 估 和 工 艺 研 发 。”<br />
他 还 介 绍 说 TNG 公 司 最 近 完 成 了 一 项 280 万<br />
澳 元 的 资 金 募 集 , 以 此 为 预 可 行 性 研 究 提 供<br />
资 金 支 持 , 包 括 资 源 升 级 , 中 试 冶 金 试 验 工<br />
作 以 及 其 他 针 对 湿 法 冶 金 工 艺 的 相 关 研 究 。<br />
Chinese uranium investment<br />
UNITED Uranium has signed a joint venture<br />
agreement with a Chinese company to advance<br />
a number of its uranium tenements in<br />
the Northern Territory. United has also received<br />