Monday , 06 Aug 2012 South Boulder Mines Ltd.
South Boulder Mines Ltd (ASX:STB) is pleased to announce that recent drilling has returned some of the highest grades to date from its world-class Colluli Potash Project in Eritrea, highlighting the potential to grow its resources further and improve project economics.
The new assays – from resource extension HQ-diamond drilling (holes Col-052 – 062, Figure 1 & Table 1) - continue to highlight potential extensions to the current JORC/NI 43-101 Compliant Resource.
The best of the latest assays, recorded in Hole Col-054, was:
- 4.26m of Sylvinite @ 34.46% KCl from 70.24m including
- 1.98m of Sylvinite @ 44.92% KCl from 70.24m.
Assays from drilling at the Central target zone also returned consistent shallow high-grade Sylvinite mineralisation from holes Col-057, 058, 060 & 062. The Central target zone is interpreted to be a direct continuation to the west of the Area B Deposit.
The best hole, Col-062, returned the following intersection:
- 2.84m of Sylvinite @ 31.22% KCl from 63.53m.
The results indicate there could be substantial growth to the high-grade Sylvinite resource that underpins the start-up mining plans for Colluli. The current JORC/NI 43-101 Compliant Resource contains 115Mt @ 28.56% KCl or 18.04% K2O of Sylvinite within a much larger total resource of 1,079Mt @ 17.97% KCl or 11.35% K2O.
In addition to these new results, recent metallurgical in-fill drilling has confirmed the presence of extensive shallow high-grade potash at Area A (see ASX announcement dated 18 July 2012). This drilling, which was completed on a nominal grid spacing of 600m, consistently intersected high-grade mineralisation.
The combination of new results from Areas A & B clearly demonstrates the potential to increase the high-grade resource inventory. The new drilling has also intersected extensive Carnallite and Kainite mineralisation zones, as is typical throughout the Colluli evaporite sequence (Table 1).
The resource extension drilling is being undertaken in parallel with metallurgical in-fill, hydrogeological and geotechnical drilling which is being completed as part of the Colluli Definitive Feasibility Study. The Study is due for completion next year, enabling South Boulder to be in production by no later than 2016.
The previous Scoping Study, which indicates that the Colulli Project is expected to be technically and economically feasible and has the potential to be a long-life project capable of delivering attractive investment returns, was based on annual production of one million tonnes of potash. However, this figure could be increased in line with further expansion in the project's JORC resource.
South Boulder's Managing Director, Lorry Hughes, said recent drilling had delineated consistent widths of high-grade shallow potash, providing significant encouragement to the project team about the ability to reduce the overall risk to the evolving mine plan.
"There is real potential to improve project economics and reduce the payback period with hits like these," Mr Hughes said.
"Very early on hole Col-004 intersected 3.5m @ 44% KCl from 33m depth at Area A. These new results are pretty similar and located up to 7.5km away. This shows very clearly that the Colluli resource is world-class.
"I think the start-up pit will still be at Area A, however with continued drilling we may just find a sweeter spot to get started," he added. "We are now eagerly awaiting the results of the revised engineering Scoping Study, due later this quarter, which will be based on mining and processing the Sylvinite and Carnallite mineralisation together.
"Having the high-grade Sylvinite mineralisation overlying the thicker Carnallite is certainly strategically important for the project in terms of payback. Further optimisation of the mining schedule to determine which parts are best to mine first will now be important.
"We have the right team in place to find, define and mine Colluli in the most cost efficient manner."
Email: firstname.lastname@example.org | South Boulder Mines Limited – Telephone +61 8 6315 1444