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According to the company, the update completes the de-risking of a 2012 Tetra Tech feasibility study on the project, and also updates estimates and forecasts to reflect costs and market conditions as of the end of 2014.
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The tungsten space has been fairly quiet since 2014 began, but last week Woulfe Mining (CSE:WOF) shook things up a little with the release of the final update to the feasibility study for its Sangdong project, located in the Republic of Korea.
According to a press release from the company, the update completes the de-risking of a 2012 Tetra Tech feasibility study on the project, and also updates estimates and forecasts to reflect costs and market conditions as of the end of 2014.
Highlights based on a WO3 concentrate price of US$15,000 per tonne include:
- Annual production of 640,000 tonnes starting in the mine’s second year of operation — the first year will bring production of 450,000 tonnes
- WO3 processing plant recovery rate of 81 percent
- Average annual WO3 concentrate production of 3,828 to 4,705 tonnes
- Project pre-production capex of US$74.4 million (using all new equipment, including Chinese processing equipment, and using a 15-percent contingency)
- Mine life of 12 years
In terms of what’s in the ground, Woulfe states that the 2012 Tetra Tech feasibility study indicates probable reserves of 13.3 million tonnes grading 0.425 percent WO3 for all 20 levels of the Sangdong deposit. It also points to inferred resources in the HW Zone of 23.1 million tonnes grading 0.66 percent WO3.
However, a new NI 43-101 compliant resource block model and resource estimate has now been prepared to feasibility study accuracy for a section of the deposit above the -3 level. It points to measured and indicated resources of 3.81 million tonnes grading 0.56 percent WO3, as well as inferred resources in the HW Zone of 7.93 million tonnes grading 0.68 percent WO3 (using a cut-off grade of 0.4 percent WO3).
Furthermore, drilling of the HW Zone above the -1 level shows indicated resources of 419,000 tonnes grading 0.95 percent WO3 using a cut off of 0.35 percent. One of Woulfe’s goals moving forward will be to convert another 3 million tonnes of inferred resources above the -3 level to the indicated category; that should happen early this year.
Finally, the release notes that environmental studies and approvals have been completed and states that the permits required for the current state of project advancement have been awarded to the company. Taking all of those variables into account, Woulfe’s consultants have recommended that Sangdong move forward to the financing and construction stages.
Investors understandably appear pleased with the news. Though Woulfe’s share price saw little action on Friday, the day the news was put out, it was up 66.67 percent, at $0.10, at close of day Monday.
That’s an impressive increase, but it’s worth noting that Woulfe’s share price has actually been on an upward swing since mid-December, when the company released a slew of information on Sangdong. Woulfe first extended a C$10-million loan from International Metal Working Companies, its strategic partner, then released a general update on Sangdong along with high-grade drill results from the project.
All in all, Woulfe’s share price is up 122.22 percent since December 15, and it looks like the company may be emerging from the dormant state it’s been in for the last couple of years. It will certainly be interesting to see whether it maintains its momentum as 2015 progresses.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.