REG - Bluebird Merchant - Raises £1.215m To Fund South Korean Gold Projects

Bluebird Mining VenturesAnnouncement

06/03/2023 10:15

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RNS Number : 9998R  Bluebird Merchant Ventures Limited  06 March 2023

Bluebird Merchant Ventures Ltd / EPIC: BMV.L / Market: FTSE / Sector: Mining

6 March 2023

Bluebird Merchant Ventures Ltd ('Bluebird' or 'the Company')

Raises £1.215 Million To Fund South Korean Gold Mine Projects

 

Bluebird Merchant Ventures Ltd, a gold company primarily focused on bringing
historic mines back into production, has raised £1,215,000 through SI Capital
via a placing and subscription for 60,750,000 New Ordinary Shares ('the
Placing Shares') at 2 pence per share ('the Placing') to fully fund
proof-of-concept production at its Kochang Gold and Silver Mine in South Korea
('Kochang'), expand the in-country team to accelerate developments at both of
its mines, and for general working capital.

 

The Company is focussed on restoring Kochang and the Gubong Gold Mine
('Gubong') back into production. Ahead of restoring Gubong, the larger of the
two mines, back into production with a medium-term target of c.60Koz Au pa,
the Company aims to undertake relatively inexpensive proof-of-concept
production at Kochang. This will provide confidence in the key parameters of
the mining operation including grade, recovery, production and processing, and
community and government support.  Once complete, production will be ramped
up to an initial 5Koz Au pa and 12-15Koz Au pa thereafter. The Company
estimates that the two mines have a potential cumulative +1.5Moz gold
resource.

 

The next steps include the granting of a Temporary Mountain Use Permit
('TMUP'), expected imminently, ordering and securing critical machinery, and
ongoing negotiations with streaming partners and debt financiers for full mine
development.

 

The funding follows the recent Scoping Study announcement (RNS 27.02.23) with
headline figures of a post-tax NPV of US$181m, free cash of US$50m per annum
and an IRR of 111%. This is based on a US$1,750 gold price for production from
two operations with a cumulative c.400Ktpa VAT leach processing operation with
a US$630 per oz All in Sustaining Cost ('AISC').

 

The Company is also pleased to announce that it has appointed SI Capital as
its broker with immediate effect.  The Company looks forward to an on-going
relationship with the SI team as it implements its development strategy to
restore historic mines back into production and build shareholder value.

 

Bluebird Merchant Ventures CEO Colin Patterson said, "We are delighted to have
raised £1.215 million to fund the proof-of-concept mining at the Kochang Gold
and Silver Mine and to prepare operations at Gubong.  The next 12 months is
going to be extremely busy once we receive the Temporary Mountain Use Permit,
which will allow operations to commence on the ground and head towards
production.  The potential of our South Korean projects was highlighted in
the recent Scoping Study, which reported a post-tax NPV of US$181m, free cash
of US$50m per annum and an IRR of 111% and the AISC estimated at US$630.

"We also look forward to news from the Philippines, where we recently secured
a Joint Venture with a local Philippine company with decades of experience in
mining, to advance our high grade Batangas Gold Project.  Th JV agreement
means we have a free carry on the project to mine construction allows us to
focus on South Korea."

 

"Finally, I would like to welcome new shareholders to the Company and look
forward to working with SI Capital as we develop our projects and build
shareholder value."

 

Full Placing Details:

Bluebird is issuing a total of 60,750,000 new ordinary shares (the "Placing
Shares") at a price of 2.0 pence per share through a private placement to
raise £1.215 million.

 

Pursuant to the Placing, the Company will also grant the placing participants
with a warrant to subscribe for 1 New Ordinary Share in the capital of the
Company for every 1 share subscribed in the placing, exercisable for a period
of 3 year from Admission of the Placing shares at a price of 3.5 pence per
ordinary share. The Company will also grant SI Capital with a warrant to
subscribe for 1,215,000 shares exercisable with a 3 year life at an exercise
price of 2.0 pence per ordinary share.

 

The Company is pleased to announce that in order to facilitate any conversion
of warrants or loans in the short term, senior management, associated parties
of Colin Patterson, Aidan Bishop and Momentum Resources, have pledged their
collective holdings of c.200 million shares ("Pledged Share Pool") for any
warrant or loan conversions that cannot be met with the Company's current
headroom. The Company will publish a secondary prospectus to refresh headroom
if and as soon as it is necessary and practicable, subject to approval by the
FCA.  The Company will update the market with the required disclosures should
any of the Pledged Share Pool be utilised.

 

Application will be made for the Placing Shares, which will rank pari passu
with the existing Ordinary Shares in issue, to be admitted to trading on the
Standard Listing Segment of the Main Market of the London Stock Exchange
("Admission").  Admission is expected on or around 13 March 2023.

 

The Company's total issued and voting share capital upon Admission will be
712,865,042 Ordinary Shares. This figure may be used by shareholders as the
denominator for the calculations by which they will determine if they are
required to notify their interest in, or a change to their interest in, the
securities of the Company.

 

 

This announcement contains inside information for the purposes of article 7 of
the market abuse regulation EU 596/2014 ("MAR").

 

**ENDS**

 

For further information please visit https://bluebirdmv.com or contact:

Colin Patterson
Bluebird Merchant Ventures Ltd               Email:
colin@bluebirdmv.com

Nick Emmerson                SI Capital
 
Tel: 01483413500

 

About Bluebird:

Bluebird Merchant Ventures Ltd (BMV.L) is a London listed South Korea-focused
resources company centred on bringing historically producing gold mines back
into production. The Company, led by a team of proven mine rehabilitation
experts, currently has two 100% owned licensed high grade narrow vein mining
projects, the Kochang Gold and Silver Project ('Kochang') and the Gubong Gold
Project ('Gubong'), which each have a defined route to low cost/ low capex
production with a cumulative target of producing 100,000 oz + Au per annum.

 

The management team has invested cUS$2 million personally into the Company and
believe, following analysis of historic production and exploration data, as
well as extensive sampling, geological, geophysical, and engineering studies,
there is potential for in excess of 1.5 million oz of mineable gold in its
Korean projects alone.

 

Kochang is an epithermal vein deposit with parallel vertical ore bodies
covering 8.3 sq km that reportedly produced 110,000 oz of gold and 5.9 million
oz of silver between 1961 and 1975.  Consisting of a gold and silver mine,
there are currently four main veins and a number of parallel subsidiary veins
vein which have been identified, as well as a newly identified cross-cutting
vein. Historic drilling indicates the veins continue to depth below the
current 150m mine and mapping shows the veins on surface providing potential
above and below the old workings. The veins extend to the NE providing a
strike length of 2.5km with 600m between the two mines not exploited.  There
is potential to expand operations to the southwest/northeast and to depth, as
well as exploit the already mined areas. The total resource potential is
between 550,000 and 700,000 tonnes, with a range of grades between 5.2 g/t to
6.6 g/t gold, and 27.3 g/t to 34.8 g/t silver.  Following the granting of a
Mountain Use permit, there is an estimated 6-to-9-month development time to
trial mining.

 

Gubong, which was historically the second largest gold mine in South Korea has
9 granted tenements covering c.25 sq km.  Gubong is moderately dipping with 9
veins extending 500m below surface and known to extend at least a further
250m. However, the production opportunity for Bluebird prior to looking at
deepening the mine is the 25 levels already developed with all the remnants
and unmined areas left by the original miners.  The 25 levels extend over
120km in total length which indicates the size of the opportunity. The Korea
Resources Corporation ('KORES') estimated 2.34M tonnes at some 7.3g/t Au
garnered from 57 drill holes over 17,715.3 metres.  With additional sampling,
mapping, pit modelling and grade analysis, plus the fact that Gubong is an
orogenic deposit, which typically have a depth of 2km compared to the current
depth of 500m, the Board believe it has a geological potential of 1 million +
oz Au in-situ, plus an estimated additional 300,000 oz Au from satellite ore
bodies.

 

Additionally, the Company has the highly prospective Batangas Gold Exploration
Project in the Philippines, where it has an agreement with a Philippine
company, whose owners have decades of experience in mining, to develop the
Project.  The JV covers the entire Batangas Project area, which has a current
JORC compliant resource of 440,000 ounces, including a maiden ore reserve of
128,000 ounces (including silver credits). Exploration expenditure to the tune
of c.$20m has already been invested.  Work is focused on completing
Exploration and Environmental Work Programmes initially targeting the
high-grade Lobo area, although there is excellent exploration potential across
the licence with high-grade targets already identified and 14km of identified
mineralised structures.  The staged agreement is based on the JV partner
achieving defined development goals and provides Bluebird with a free carry on
the development of Batangas with a view to advancing to construction.

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