More High-Grade Assays Highlight Potential to Boost Resources at Colluli
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 _at_ 34.46% KCl from 70.24m including
1.98m of Sylvinite _at_ 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 _at_ 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
_at_ 28.56% KCl or 18.04% K2O of Sylvinite within a much larger total
resource of 1,079Mt _at_ 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 _at_ 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."
Recent investor relations, corporate videos and broker/media coverage
on The Company's projects can be viewed on the website in the "Media
Centre" and "Investor Centre" sections by following the links
www.southbouldermines.com.au and www.abid.co.
About South Boulder Mines Ltd
Listed in 2003, South Boulder Mines (ASX: STB) is a diversified
explorer focused on potash, nickel and gold. South Boulder has a 90%
interest in the Colluli Potash Project in Eritrea and a 100% interest
in the Duketon Gold Project in Western Australia.
The Colluli Potash Project has a current JORC Compliant Measured,
Indicated and Inferred Mineral Resource Estimate comprised of
261.81Mt _at_ 17.94% KCl or 11.33% K2O of Measured Resources, 674.48Mt _at_
17.98% KCl or 11.36% K2O of Indicated Resources and 143.50Mt _at_ 18.00%
KCl or 11.37% K2O of Inferred Resources for a total of 1,079.00Mt _at_
17.97% KCl or 11.35% K2O (total contained potash of 194.09Mt KCl or
122.61Mt K2O); This includes higher grade Sylvinite of 114.60Mt _at_
28.56% KCl or 18.04% K2O. The current resource is included in an
exploration target of 1.25 - 1.75 billion tonnes _at_ 18-20% KCl ## (see
disclaimer below).
An engineering scoping study for the production of 1Mt p.a. of potash
demonstrated an estimated capital cost of US$0.74bn generating a Pre-
tax NPV12 of US$1.33bn. A Definitive Feasibility Study into open pit
mining and processing of the resource is underway with initial
production scheduled for 2016 or sooner. South Boulder has strong
support from the Eritrean Government to build a long term,
economically and environmentally sustainable resource project.
Within the Duketon Gold Project area, South Boulder entered a farm-
out Joint Venture (JV) Agreement with Independence Group NL, whereby
Independence can earn a 70% interest in the nickel rights on select
tenements held by South Boulder in the Duketon Project, by the
completion of a Bankable Feasibility Study within 5 years of the
grant of the relevant tenement.
About the Duketon Nickel Joint Venture
The Duketon Nickel Joint Venture (DNJV) has had recent success at The
Rosie and C2 Nickel sulphide prospects where drilling has defined
intercepts of 5.20m _at_ 9.2% Ni, 1.09% Cu, 0.21% Co and 7.09g/t PGE's
at Rosie and 50m _at_ 0.92% Ni including 37m _at_ 1.05% Ni at C2. The
deposits are located approximately 120km NNW of Laverton, W.A in the
Duketon Greenstone Belt. The deposits are approximately 2km apart and
the mineralisation at both prospects is considered open in most
directions. A Mining Lease was granted over the Rosie and C2 deposits
on the 19th of November. A Maiden JORC Compliant Mineral Resource
Estimate has been compiled for the Rosie deposit; please refer to the
Company's 25th January 2012 ASX Announcement for details
## Competent Persons and Responsibility Statement
The Colluli Potash Project has a current JORC/NI43-101 Compliant
Measured, Indicated and Inferred Mineral Resource Estimate of
1,079.00Mt _at_ 17.97% KCl or 11.35% K2O (total contained potash of
194.09Mt KCl or 122.61Mt K2O). The resource contains 261.81Mt _at_
17.94% KCl or 11.33% K2O of Measured Resources, 674.48Mt _at_ 17.98% KCl
or 11.36% K2O of Indicated Resources and 143.50Mt _at_ 18.00% KCl or
11.37% K2O of Inferred Resources. The current Mineral Resource
Estimate is included in the current exploration target of 1.25 - 1.75
billion tonnes _at_ 18-20% KCl. The potential quantity and grade of the
total current exploration target which includes the current Mineral
Resource Estimate is conceptual in nature and there has been
insufficient exploration to define a Mineral Resource other than the
current Mineral Resource Estimate and it is uncertain if further
exploration will result in the determination of a Mineral Resource
Estimate other than the current Mineral Resource Estimate.
This ASX release has been compiled by Lorry Hughes using information
on exploration results and Mineral Resource estimates supplied by
South Boulder Mines Ltd under supervision by Ercosplan. Dr Henry
Rauche and Dr Sebastiaan van der Klauw are co-authors of the JORC and
NI43-101 compliant resource report. Lorry Hughes is a member in good
standing of the Australian Institute of Mining and Metallurgy and
Dr.s' Rauche and van der Klauw are members in good standing of the
European Federation of Geologists (EurGeol) which is a "Recognised
Overseas Professional Organisation" (ROPO). A ROPO is an accredited
organisation to which Competent Persons must belong for the purpose
of preparing reports on Exploration Results, Mineral Resources and
Ore Reserves for submission to the ASX.
Mr Hughes, Mr Rauche and Mr Van Der Klauw are geologists and they
have sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the
activity which they have undertaken to qualify as a Competent Person
as defined in the 2004 Edition of the "Australian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves". Mr
Hughes, Mr Rauche and Mr van der Klauw consent to the inclusion in
the report of the matters based on his information in the form and
context in which it appears. Mr Hughes is a full-time employee of the
company. Mr Rauche and Mr van der Klauw are employed by the Ercosplan
Group of Companies.
Quality Control and Quality Assurance
South Boulder Exploration programs follow standard operating and
quality assurance procedures to ensure that all sampling techniques
and sample results meet international reporting standards. Drill
holes are located using GPS coordinates using WGS84 Datum, all
mineralisation intervals are downhole and are true width intervals.
Assay values are shown above a cut-off of 6% K2O. The samples are
derived from HQ diamond drill core which in the case of carnallite
ores are sealed in heat sealed plastic tubing immediately as it is
drilled to preserve the sample. Significant sample intervals are dry
quarter cut using a diamond saw and then resealed and double bagged
for transport to the laboratory. Halite blanks and duplicate samples
are submitted with each hole. Chemical analyses were conducted by
Kali-Umwelttechnik GmBH Sondershausen, Germany utilising flame
emission spectrometry, atomic absorption spectroscopy and
ionchromatography. Kali-Umwelttechnik (KUTEC) Sondershausen1 have
extensive experience in analysis of salt rock and brine samples and
is certified according by DIN EN ISO/IEC 17025 by the Deutsche
Akkreditierungssystem Prüfwesen GmbH (DAR). The laboratory follow
standard procedures for the analysis of potash salt rocks • chemical
analysis (K+, Na+, Mg2+, Ca2+, Cl-, SO42-, H2O) and • X-ray
diffraction (XRD) analysis of the same samples as for chemical
analysis to determine a qualitative mineral composition, which
combined with the chemical analysis gives a quantitative mineral
compositi
Received on Mon Aug 06 2012 - 22:09:11 EDT
