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From: Berhane Habtemariam (Berhane.Habtemariam@gmx.de)
Date: Wed Sep 07 2011 - 18:36:41 EDT
South Boulder Mines eyes potash JORC update after latest high grade hits at
Colluli
07/09/2011 12:15 am
South Boulder Mines (
<http://www.proactiveinvestors.com.au/companies/sponsors_landing/1142/south-
boulder-mines-1142.html> ASX: STB) continues to deliver a string of high
grade potash hits from the Colluli Potash Project in Eritrea.
The importance of the first "partial hole assays" returned from upper
mineralised zones in 9 holes have confirmed Area B as a significant addition
to the Colluli Potash Project, with the results continuing to support the
project Exploration Target of 1.25 to 1.75 billion tonnes at 18-20% KCl.
The latest highlights include:
- 1.72 metres of sylvinite at 39.69% KCl from 50.28 metres;
- 5.58 metres of sylvinite at 31.47% KCl from 65.59 metres;
- 2.96 metres of sylvinite at 29.85% KCl from 86.06 metres; and
- 2.04 metres of sylvinite at 27.63% KCl from 33.63 metres.
South Boulder said that the continuous zones containing sylvinite,
carnallite / kieserite and kainitite mineralisation have been identified in
18 of 22 holes drilled at Area B to date.
Boosting the potential of the project even further is that the holes are
open in all directions.
The Colluli current JORC Resource is 548 million tonnes at 18.6% KCl, for
total contained potash of 102 million tonnes.
Anticipation builds for pending assays
The latest high grade intersections at Colluli have increased the
anticipation for the remainder of the assays from these holes, which will be
delivered in the coming months.
These results will then form part of the ongoing JORC Resource updates for
the project.
Exploration and development activity is currently focused on resource
compilation for the September update, downhole geophysical logging,
metallurgical testwork, mining engineering and hydrogeological assessment to
support Definitive Feasibility Studies.
South Boulder indicated in the June quarterly that an engineering Scoping
Study into the low cost production of 1-2mt of potash by 2016 or sooner will
be complete in the September quarter.
Eritrea - an east African country
Eritrea is a stable jurisdiction that is fully supportive of South Boulder
activities, with the project awarded to the company by an open tender
process.
The deal structure is as follows:
- Exploration Phase, South Boulder 100% ownership;
- After Mining Lease and BFS, the Government receives 10% of the project for
free and can purchase up to another 30% of the project at fair value;
- The 40% is a full equity participation interest, Government to pay 40% of
operating and capital costs;
- 3.5% royalty on potash and corporate tax rate of 38%; and
- The deal structure paves the way for a secure and reliable partnership.
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