Botnia takes the next step – planning start of small-scale gold mine

The decision is mainly based on the good gold contents in Fäbodtjärn, the positive concentration tests that have been conducted of Fäbodtjärn by the use of gravimetric methods, and the qualifications for using small-scale mining. These factors have led to that Botnia deems that the Fäbodtjärn deposit itself can become profitable, by good income from gold sales and lower investments and operating expenses. The plans include the building of a mobile concentration plant with gravimetric equipment such as spirals, shaking tables and Knelson separators. The intention is that a future mining will take place in small-scale and underground, which is an approach as to make the environmental footprint as small as possible. The estimated life-time of the mine is approx. 7 years. The concentration is planned to be conducted during the summer months, with a capacity of approx. 20 tonnes/hour. Fäbodtjärn has an inferred mineral resource which is estimated to contain 210 kilo tonnes, with an average content of 7.1 g/t Au.

The work with the permit applications for test mining and exploitation concession is in progress and the test mining is planned to start in summer 2015. Approx. 25,000 tonnes will then be blasted in the form of a pipe trench at the upper part of the gold-bearing quartz vein.
Altogether, the exploration results in recent years mean that Botnia considers that the entire Vindelgransele area, in addition to Fäbodtjärn, has good potential to become a successful mining area by small-scale mining. The company has an exploitation concession in Vargbäcken, where the test mining results showed that the gravimetric concentration is preferable also in Vargbäcken. There is also a great exploration potential in the area, which the good analysis results from both boulders and bedrock show.
”To take the step from an exploration company to a mining company is a large step, but it is a natural development of the business idea considering our exploration results in Vindelgransele. The Board of Directors solidly agree on running the project under its own management if the further studies are successful.  Our profitability calculations, which are based on budgetary quotations from suppliers, and investigations from consultants show that Fäbodtjärn has potential to show good profitability and give a fast cash flow. The objective is that the project can be financed without any new issue of shares. The planning of a local concentration plant in Vindelgransele also opens opportunities to mine the deposit Vargbäcken. The contents in Vargbäcken are lower than in Fäbodtjärn, but we know since the previous test concentrations at Björkdalsgruvan that gravimetric concentration is very suitable also for Vargbäcken and with high yields. An important synergy effect with the concentration tests of Fäbodtjärn. The calculations underlying the decision indicate that the mining can be self-financed, since the underground mining can start directly in the gold-bearing quartz vein and by that generate a positive cash flow. If the conditions hold, it is our goal to create a result that allows dividends to our shareholders” says Bengt Ljung, CEO for Botnia Exploration Holding AB.
“The company’s focus on exploration in the Vindelgransele area has been successful. There are many indications that Fäbodtjärn would be well suited for small-scale mining, with a limited environmental footprint. The company’s next step will be to verify our ore model by test mining, to make a detailed planning of the necessary facilities and to apply for environmental permits. When this is done, we have sufficient basis for a decision on production start” says Per-Erik Lindvall, Chairman of the Board for Botnia Exploration Holding AB.
“The gold deposit Fäbodtjärn is one of the most interesting deposits identified in Sweden in many years. In addition, the geological environment in Vindelgransele shows a unique exploration potential for deposits suitable for small-scale mining” says Pär Weihed, Member of the Board for Botnia Exploration Holding AB.
For further information, please contact:
Bengt Ljung, CEO – Botnia Exploration
Phone: +46 705 431605
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