Kochang Underground Grab Sample Results

RNS Number : 0256O

Bluebird Merchant Ventures Limited

15 May 2018

 

15 May 2018

Bluebird Merchant Ventures Ltd

(the "Company" or "Bluebird")

Kochang Underground Grab Sample Results

Bluebird Merchant Ventures (EPIC: BMV), the Asian focused resource development group is pleased to announce encouraging results of its underground grab sampling at Kochang and the sortability of the ore.

Highlights:

·      Early production feedstock has been identified

·      Initial Program indicates substantial improvement of the grade through sorting - 1.69 g/t to 5.12 g/t Au

·      Potential operating profit of USD 750/oz from broken rock

Bluebird examines a number of potential products when determining the viability of reopening a mine. One of those products is 'broken rock' (blasted rock that has not been taken out of the mine).  The methodology employed in evaluating the rock is called 'grab sampling'.  One reason that broken rock is left behind is due to it being deemed uneconomic at the time.  The Kochang mine closed in 1975 when the gold price was USD140/oz.  Much of the ore that was left behind that was once uneconomic would now be considered economically viable.  The current gold price is currently over USD 1,300/oz.  

The complete sampling program was undertaken over 1,300 metres on the two main levels.  The Kochang mine has three levels and two have been accessed thus far. Each level has three veins which were historically mined. Where broken rock was found, systematic sampling was undertaken at equal distances by taking a 3-5kg bag of the rock, at each position, for assay. There was no selectivity involved.

After these samples were analysed nine of the sample positions were resampled with the instruction to the samplers to selectively 'pick' ore. The results can be found in the second column of Table 2.

As can be seen in Table 2 below, the picked ore was at an average grade of 5.12 g/t Au compared to the original 1.69 g/t Au. This indicates that substantial beneficiation of the grade can be gained through sorting. Whilst this simple test was done by hand sorting, there are many sorting technologies available for this type of work and they can be set up to sort ore using a number of parameters.

Broken rock is cheap because the costly work of drilling and blasting has already been carried out. The only task left is to take it to a process plant. By utilising sorting techniques, the cost of recovering this gold source can be substantially reduced.  This broken rock is likely to be the initial production feedstock.

The Company expects to update the market next week with further results from the underground sampling program of the veins at Kochang.

Charles Barclay, COO, commented:

"We are delighted with results from this initial programme at Kochang and the grades that we have seen.

"Although the engineers and geologists are yet to accurately determine the tonnes of broken rock/ore that is remaining it is worth noting that for every 1,000 tonnes of sorted rock delivered for metallurgical treatment at a conservative grade of say 4g/t Au, recovery of 85% and total operating cost of approximately $60/t, the Company could expect to make an operating profit of around USD 750 per ounce of gold recovered at a gold price of $1300/oz.

"The current economic climate for gold mining, combined with our higher than expected grades, provides us with great confidence as we progress further with our underground sampling programme. We look forward to providing further updates in due course."

The table below shows the significant results (>1.0 g/t) of that sampling.

Table 1 - Grab Sampling with no selectivity

Sample Number	Underground Drive	Au Grade (g/t)	Ag Grade (g/t)
KRS350016	245 Lvl	1.03	8
KRS350022	245 Lvl	2.12	24
KRS350023	245 Lvl	2.34	13
KRS350024	245 Lvl	1.51	5
KRS350025	245 Lvl	3.15	11
KRS350026	245 Lvl	5.86	20
KRS350033	245 Lvl	1.4	4
KRS350034	245 Lvl	1.26	4
KRS350035	245 Lvl	1.19	5
KRS350041	245 Lvl	3.11	27
KRS350042	245 Lvl	3.74	32
KRS350044	245 Lvl	1.51	11
KRS350046	245 Lvl	5.87	32
KRS350047	245 Lvl	4.06	56
KRS350048	245 Lvl	2.46	27
KRS350049	245 Lvl	17.4	165
KRS350064	245 Lvl	1.52	5
KRS350065	245 Lvl	2.3	7
KRS350066	245 Lvl	4.38	7
KRS350068	245 Lvl	2.94	10
KRS350069	245 Lvl	2.1	11
KRS350073	245 Lvl	1.56	22
KRS350078	260 SubLvl	1.09	13
KRS350080	260 SubLvl	1.03	9
KRS350083	265 Lvl	2.27	22
KRS350084	265 Lvl	1.34	8
KRS350085	265 Lvl	1.81	15
KRS350087	265 Lvl	2.31	18
KRS350088	265 Lvl	3.51	15
KRS350089	265 Lvl	3.67	18
KRS350090	265 Lvl	2.27	18
KRS350092	265 Lvl	1.02	3
KRS350093	265 Lvl	2.73	14
KRS350094	265 Lvl	1.84	9
KRS350095	265 Lvl	3.25	18
KRS350096	265 Lvl	2.8	16
KRS350097	265 Lvl	2.78	18
KRS350098	265 Lvl	2.12	15
Average:		2.86	19.34
Samples:		38	38

.

Table 2 - Grab Samples with selectivity

Sorted Grab Sample Number	Au Grade (g/t)	Previous Grab Sample Number	Au Grade (g/t)	Au Increase / Decrease
KRS350101	2.82	KRS350024	0.87	1.95
KRS350103	0.71	KRS350084	2.78	-2.07
KRS350104	3.3	KRS350096	2.8	0.5
KRS350105	2.17	KRS350097	2.78	-0.61
KRS350106	13.5	KRS350037	0.49	13.01
KRS350107	8.75	KRS350039	0.07	8.68
KRS350108	3.94	KRS350058	0.1	3.84
KRS350109	0.39	KRS350065	2.3	-1.91
KRS350110	10.5	KRS350068	2.98	7.52
Average Grade	5.12		1.69	3.43

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 ("MAR")

Enquiries:

Bluebird Merchant Ventures Ltd	[phone]
Jonathan Morley-Kirk, Non-Executive Chairman
SP Angel Corporate Finance LLP Ewan Leggat Smaller Company Capital Ltd Rupert Williams/Jeremy Woodgate	+ 44 (0) 20 3470 0470 [phone]
Blytheweigh	[phone]
Tim Blythe / Camilla Horsfall / Nick Elwes

www.bluebirdmv.com

@BluebirdIR

 

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