REG - Tungsten West PLC - Increased Mineral Resource & Ore Reserve Estimates

Tungsten WestAnnouncement

19/12/2022 07:00

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RNS Number : 0786K  Tungsten West PLC  19 December 2022

Tungsten West Plc

("Tungsten West", the "Company" or the "Group")

 

Increase in Mineral Resource and Ore Reserve Estimates for the Hemerdon
Project

 

 

Tungsten West plc (LON: TUN), the mining company focussed on restarting
production at the Hemerdon tungsten and tin mine ("Hemerdon" or the "Project")
in Devon in the UK, is pleased to provide this update on the JORC (2012)
compliant Ore Reserve Estimate ("ORE") and internal Mineral Resource Estimate
("MRE"), as part of the work completed for its updated Feasibility Study for
its flagship Hemerdon Project.

 

Hemerdon Ore Reserve Estimate Highlights:

·    60% increase in ore tonnage and 10% increase in contained metal from
previous 2021 ORE

·    The 2022 Hemerdon Ore Reserve is now 101.2Mt at 0.14% WO(3) and 0.03%
Sn

·    The Hemerdon deposit is estimated to be the second largest reported
CRIRSCO standard tungsten reserve globally

 

Hemerdon Mineral Resource Estimate Highlights:

·    7% increase in tonnage and 1% increase in contained metal from
previous 2021 MRE

·    The 2022 Hemerdon Global Mineral resource is 351.5Mt at 0.12% WO(3)
and 0.03% Sn

·    The Hemerdon deposit is now estimated to be the second largest
reported CRIRSCO standard tungsten resource globally

 

Mark Thompson, Executive Vice-Chairman, commented: "The increase in both the
Ore Reserve and Mineral Resource at Hemerdon further highlights the world
class nature of the deposit we have in Devon, which now hosts the second
largest tungsten reserve and resource, globally.

 

"The lift in both the Ore Reserve and Mineral Resource is a reflection on the
work that has been undertaken this year as part of our cost saving initiative
and improvement to operating efficiencies across the business. This will also
be realised in our updated Feasibility Study, a summary of which we expect to
release shortly.

 

"Within a year of acquiring the Project, we undertook the first exploration
drilling programmes in almost 30 years. These programmes had significant
success in growing the Mineral Resources and we have complemented that with
the development of an enhanced mineral beneficiation flowsheet and energy
saving initiatives to reduce our processing costs. These initiatives, in turn,
have had a positive impact of the Ore Reserves.

 

"We intend to continue to build on this world class asset and continue the
trend of adding value through reserve and resource growth through future
drilling campaigns as indicated by the scale of the proposed exploration
target."

 

Further information

2022 Hemerdon Ore Reserve Estimate

This Ore Reserve Estimate is based on the MRE update completed in January 2021
by independent mining consultants Mining Plus UK Ltd ("MPUK") and is
underpinned by a pit optimisation study conducted by MPUK during October 2022,
followed by detailed pit design, pushback design, Life of Mine scheduling and
financial modelling. All reserves are reported in accordance with the 2012
edition of the JORC code.

The total updated Ore Reserve Estimate (Proved and Probable) for Hemerdon is
101.2 Mt at 0.14% WO3 and 0.03% Sn, reported above an Ore Reserve cut-off
grade of 0.0742% WO(3) Equivalent ("WO(3)Eq") for the granite and 0.0689%
WO(3)Eq for the killas. This Ore Reserve includes 0.6 Mt of existing
stockpiles remaining from the previous site operator, Wolf Minerals, open pit
mining operations (2015-2018).

Both the Hemerdon granite and the host metasedimentary material (locally known
as "killas") within the final pit design are included in this Ore Reserve. To
maximise project Net Present Value ("NPV") the Project plans to stockpile the
lower grade (but still economic) killas material until completion of the
mining phase, at which time the killas stockpiles will be reclaimed and fed
through the mineral processing facility ("MPF").

Table of Ore Reserve Estimates

 Ore Type    Cut-off WO(3) Eq  Proved Ore Reserves          Probable Ore Reserves             Total Ore Reserves

             (%)
             Tonnes (Mt)                WO(3) (%)  Sn (%)   Tonnes (Mt)  WO(3) (%)  Sn (%)    Tonnes (Mt)  WO(3) (%)  Sn (%)
 Granite     0.0742            32.1     0.18       0.03     24.0         0.17       0.02      56.1         0.17       0.03
 Killas      0.0689            8.3      0.11       0.03     36.3         0.10       0.03      44.5         0.10       0.03
 Sub-total   N/A               40.4     0.16       0.03     60.2         0.13       0.03      100.6        0.14       0.03
 Stockpiles  N/A               0.6      0.20       0.06     -            -          -         0.6          0.20       0.06
 Total       -                 41.0     0.17       0.03     60.2         0.13       0.03      101.2        0.14       0.03

Notes to accompany Ore Reserves table:

1. The Qualified Person for the estimate is Mr. Adriano Carneiro, fellow
AusIMM, a MPUK employee. The estimate has an effective date of 15 November
2022.

2. Ore Reserves are reported using the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves" (The JORC Code) 2012
Edition.

3. Numbers may not add up due to rounding. Rounding as required by reporting
guidelines may result in apparent differences between tonnes, grade and
contained metal content.

4. All tonnages reported are dry metric tonnes.

5. WO(3)Eq calculated as WO(3)Eq = WO(3) + (0.4942*Sn) for granite and WO(3)Eq
= WO(3) + (0.3794*Sn) for killas.

 

2022 Hemerdon Mineral Resource Estimate

The Updated Hemerdon Mineral Resource Estimate, prepared internally by the
Company, includes the in-situ mineralised granite and killas domains alongside
stockpile and tailings material generated as a result of the former mining
operations between 2015 and 2018. All Mineral Resources are reported in
accordance with the 2012 edition of the JORC code.

The 2022 MRE update is based on the 2021 estimate produced by MPUK that has
been re-reported with updated cost and processing assumptions as a result of
the operational redevelopment undertaken as part of the 2022 Feasibility
Study. There have been no material differences in geological interpretation or
data used to support the estimation since 2021. This is to ensure alignment
with the updated mineral reserve and has resulted in a reduction in the
breakeven ("BE") cut-off grade ("CoG"). The updated 2022 Hemerdon Mineral
Resource is therefore reported above a WO(3) Eq BE CoG of 0.064% for granite
and 0.062% for killas within an optimised pit shell generated using the same
economic parameters used to calculate the BE CoG.

Furthermore, the 2022 MRE reflects updated changes to the Hemerdon stockpile
inventory following depletion of various stockpiles since the 2021 reported
MRE as part of aggregate sales.

The 2021 MRE prepared by MPUK for the resource contained within the Mine Waste
Facility ("MWF") generated through former operations remains unchanged as a
component of the global Hemerdon Mineral Resource Estimate.

The changes to the updated 2022 MRE are minimal and can be summarised as a 7%
overall increase in tonnes and a 1% increase in contained metal. The reason
for the minor difference in overall ore tonnes due to the minor change to the
granite BE CoG. Any increases to the overall tonnes can be attributed to the
more noticeable reduction in the killas BE CoG.

Table of Global Mineral Resources Estimate

 Domain      Cut-Off WO(3) Eq (5)  Measured                             Indicated                                   Inferred
             Tonnes (Mt)                 WO₃ (%)    Sn (%)  WO3_EQ (%)  Tonnes (Mt)  WO₃ (%)    Sn (%)  WO3_EQ (%)  Tonnes (Mt)  WO₃ (%)    Sn (%)  WO3_EQ (%)
 Granite     0.064%                33.6  0.18       0.03    0.19        84.0         0.15       0.02    0.16        36.5         0.11       0.02    0.12
 Killas      0.062%                8.5   0.11       0.03    0.13        44.7         0.10       0.03    0.11        140.4        0.09       0.03    0.10
 Stockpiles  N/A                   0.6   0.20       0.06    0.23        -            -          -       -           -            -          -       -
 MWF         N/A                   -     -          -       -           -            -          -       -           3.2          0.18       0.02    0.18
 Total       -                     42.8  0.16       0.03    0.18        128.6        0.13       0.03    0.14        180.1        0.10       0.03    0.11

Notes to accompany Mineral Resource table

1. The Qualified Person for the estimate is Mr. James McFarlane, BSc (hons),
MSc, MCSM, FGS, CEng FIMMM, RPGeo MAIG, FIQ, a Tungsten West employee. The
estimate has an effective date of 11th October 2022.

2. Mineral Resources are reported using the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves" (The JORC Code) 2012
Edition.

3. Numbers may not add up due to rounding. Rounding as required by reporting
guidelines may result in apparent differences between tonnes, grade and
contained metal content.

4. All tonnages reported are dry metric tonnes.

5. WO(3) Eq calculated as [ Sn%*0.379 +WO₃%].

 

Exploration Target

 

The 2022 Hemerdon MRE retains the previously proposed exploration target from
the 2021 MRE for Hemerdon of ~55.7 to 83.5 Mt of granite at a grade of ~0.09
to 0.13% WO(3) and ~272 to 408 Mt of killas at a grade of ~0.10 to 0.14%
WO(3). In reporting the exploration target it should be made clear that the
potential quantity and grade is conceptual in nature, that there has been
insufficient exploration to estimate a Mineral Resource and that it is
uncertain if further exploration will result in the estimation of a Mineral
Resource.

The exploration target is based on drilling data for the Hemerdon deposit
which has been estimated within the Hemerdon block model above cut off grades
but does not exhibit sufficient geological continuity to be classified as a
Mineral Resource under the JORC Code 2012 edition. As such the exploration
target is reported as a range of grade and tonnage to reflect this uncertainty
based on an assessment of the grade-tonnage curves of this material whereby a
range of +/-20% was deemed reasonable.

The scale of the exploration target exhibits the future potential for the
Mineral Resources and Ore Reserve to continue to grow with future drilling
campaigns, which will be undertaken regularly to further define the resource
and explore for additional material as part of the operational strategy when
in production.

 

Further Updates

 

The updated Mineral Resource and Ore Reserve Estimates form a fundamental
aspect of the updated and independently reviewed Feasibility Study for which
the Company expects to publish the summary result of in the coming days. The
Company will also continue to provide further guidance on Project progress as
milestones are completed.

 

 

 

Competent Persons Statements:

Information in this announcement pertaining to Reporting of Sampling
Techniques and Data, Exploration Results and Estimation and Reporting of
Mineral Resources has been reviewed and approved by Mr James McFarlane, BSc
(Hons), MSc, MCSM, FGS, CEng FIMMM, RPGeo MAIG, FIQ . Mr McFarlane holds a BSc
with Honours from The University of Wales, Aberystwyth in Environmental Earth
Science and an MSc in Mining Geology from Camborne School of Mines, University
of Exeter, he is also a Master of the Camborne School of Mines (MCSM). Mr
McFarlane is a Fellow of the Geological Society of London (FGS), a Chartered
Engineer (CEng) and Fellow of the Institute of Materials, Minerals and Mining
(FIMMM) through which he is also a Registered Mineral Resources and Reserves
Reporting Practitioner. Mr McFarlane is a Member of the Australian Institute
of Geoscientists (MAIG) and through which is Registered Professional
Geoscientist in the joint fields of Mining and Mineral Exploration (RPGeo). Mr
McFarlane is also a Fellow of the Institute of Quarrying (FIQ). Mr
McFarlane is an employee of the Company. Mr McFarlane has sufficient
experience relevant to the style of mineralisation and type of deposit under
consideration, and to the activity which he is undertaking to qualify as a
Competent Person as defined by the 2012 Edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC
Code) and under the AIM Rules

- Note for Mining and Oil & Gas Companies, which outline standards of
disclosure for mineral projects. Mr McFarlane consents to the inclusion in
this announcement of the matters based on this information in the form and
context in which it appears. Mr McFarlane confirms that the Company is not
aware of any new information or data that materially affects the information
included in the relevant market announcements, and that the form and context
in which the information has been presented has not been materially modified.

The information in this release that relates to the Estimation and Reporting
of Ore Reserves has been compiled by Mr Adriano Carneiro BEng (Mining)
FAusIMM. Mr Carneiro is a full-time employee of Mining Plus UK Limited Ltd and
has acted as the Competent Person on the Hemerdon deposit Ore Reserve
Estimation. Mr Carneiro is a Fellow Professional of the Australasian Institute
of Mining and Metallurgy and has sufficient experience with the commodity,
style of mineralisation and deposit type under consideration and to the
activities undertaken to qualify as a Competent Person as defined in the 2012
Edition of the "Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves" (The JORC Code).

- Note for Mining and Oil & Gas Companies, which outline standards of
disclosure for mineral projects. Mr. Carneiro consents to the inclusion in
this report of the contained technical information relating the Ore Reserve
Estimation in the form and context in which it appears. Mr Carneiro confirms
that the Company is not aware of any new information or data that materially
affects the information included in the relevant market announcements, and
that the form and context in which the information has been presented has not
been materially modified.

For more information on the Project, including the JORC Table 1, please
see the following page of the Company's website:
https://www.tungstenwest.com/project (https://www.tungstenwest.com/project)

 

This announcement contains inside information for the purposes of Article 7 of
Regulation 596/2014 as amended by the Market Abuse (Amendment) (EU Exit)
Regulations 2019.

 

 

 

 

 

Enquiries

 

 Tungsten West                                                            Strand Hanson

 Mark Thompson                                                            (Nominated Adviser and Financial Adviser)

 Tel: +44 (0) 203 178 7385                                                James Spinney / James Dance / Abigail Wennington

                                                                          Tel: +44 (0) 207 409 3494
 BlytheRay                                                                Hannam & Partners

 (Financial PR)                                                           (Joint Broker)

 Tim Blythe / Megan Ray                                                   Andrew Chubb / Matt Hasson / Jay Ashfield

 Tel: +44 (0) 207 138 3204                                                +44 (0)20 7907 8500

 Email: TungstenWest@blytheray.com (mailto:TungstenWest@blytheray.com)

                                                                          VSA Capital Group plc

                                                                          (Joint Broker)

                                                                          Andrew Raca / Andrew Monk

                                                                          +44 (0)20 3005 5000

Follow us on twitter @TungstenWest

 

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