Southern Gold’s subsidiary, Southern Gold Korea, has received approval from South Korean mining regulators, which enables the re-opening of and access to the historic Gubong underground gold mine. It was South Korea’s second largest gold mine with multiple gold-bearing quartz veins mined over 60 years.
The approval allows Southern Gold’s development partner, Bluebird Merchant Ventures, to achieve access and begin the project assessment process. This work forms part of a farm-in and joint venture agreement signed with Bluebird in March this year.
Bluebird has informed Southern Gold that there is more than 50km of level development accessed by two vertical shafts and six inclined shafts in what was a substantial mining operation.
Bluebird will now proceed to re-open the mine, conduct preliminary assessment work and complete an evaluation of re-starting operations. This evaluation will take 6-9 months and cover modern era resource estimation, mining methodology, metallurgical studies, capital and operating cost estimates and financial analysis.
Southern Gold has also been active with community relations and management of regulators more broadly, including the Mine Safety Office, MIRECO and Mine Registry Office, and is extremely pleased with the response of the local community and regulators.
Southern Gold’s managing director Simon Mitchell said, “Southern Gold believes there is a significant embedded dollar value in this underground development with the existing mining infrastructure providing an opportunity for low capital cost options for a future new mining regime at Gubong.
“We have made great progress at this project, being several weeks ahead of schedule in terms of access approvals. This bodes well for moving the project through the next stages.”
The company has also made some progress at the former very high-grade Taechang gold mine to the northeast of Gubong, which is one of the six main gold projects in South Korea acquired last year by Southern Gold.
A preliminary review of data and old mine plans concludes that Taechang is part of a much broader mineralised district but much of the activity dates to the Second World War and the Japanese occupation era.
While Taechang remains the most substantial gold project in the district that Southern Gold is aware of, it may take some additional time to complete assessments compared with the rapid timeframe that has been possible at Gubong.