Perth, Nov 12, 2008 AEST (ABN Newswire) - Sultan Corporation Limited's (ASX:SSC) exploration program conducted during the past 12 months was highly successful in upgrading the JORC resource at John Fardy; delineating maiden JORC resources at Peelwood; and identifying strong mineralisation at the Black Springs project.
All projects remain open to further expansion and will be tested in the coming year.
Sultan Corporation is pleased to announce updated resources at its John Fardy and Peelwood prospects. Table 1 details the combined resource for these prospects.
Table 1 - Combined Resource Update for John Fardy and Peelwood
-------------------------------------------------Resource Tonnes Zn % Cu % Pb % Ag g/t Zinc Equiv. -------------------------------------------------Combined Resource 895,000 3.94 0.8 0.73 16 8.0-------------------------------------------------
NB: The zinc equivalence formula and relevant calculation variables are outlined in the section titled "Description and notes on John Fardy and Peelwood Resource Estimates."
John Fardy and Peelwood have both been estimated in accordance with the JORC Code (2004) and the individual resource estimates are given in Table 2 below. The categories of indicated and inferred with decreasing levels of confidence are as follows:
Table 2 - Individual Resource Updates for John Fardy and Peelwood Prospects
---------------------------------------------------------Resource Resource Tonnes Zn% Cu% Pb% Ag g/t Zinc Category Equiv. ---------------------------------------------------------John Fardy * (1% Zn cut-off) Indicated 597,000 4.5 1.0 0.6 15 9.2 Inferred 39,000 3.0 1.1 0.3 13 7.8 Total 636,000 4.4 1.0 0.5 15 9.0---------------------------------------------------------Peelwood ** Inferred 259,000 2.82 0.3 1.28 17 5.45 Total 259,000 2.82 0.3 1.28 17 5.45 ---------------------------------------------------------Combined Resource 895,000 3.94 0.8 0.73 16 8.0---------------------------------------------------------
* John Fardy October 2008 Resource was estimated by Chris Black of Cube Consulting Pty Ltd
** Peelwood Resource was estimated by Kevin Alexander of Sultan Corporation Ltd
NB: The zinc equivalence formula and relevant variables for calculation are outlined in the section titled "Description and notes on John Fardy and Peelwood Resource Estimates."
John Fardy and Peelwood zinc and copper prospects are 100% owned by Sultan Corporation and are located 75km south of Bathurst in central New South Wales. These prospects are part of a larger contiguous group of tenements held by Sultan and include other advanced targets such as Black Springs (see Figure 1).
Develop Mine/Generate Cash Flow
As previously announced to the market (ASX: 16-06-2008) Sultan has engaged Intermine Engineering Consultants to complete all design and mining engineering studies. Intermine has optimised the current resource and preliminary indications show that the following tonnages are likely to occur within the respective open cuts at John Fardy and Peelwood projects.
Table 3 - Open Pit Estimates
-------------------------------------------------Resource Tonnes Zn% Cu% Pb% Ag g/t Zinc Equiv. -------------------------------------------------John Fardy 360,000 5.01 0.99 0.70 16 10.2-------------------------------------------------Peelwood 109,000 5.67 0.55 2.72 32 11.6 -------------------------------------------------Combined Resource 469,000 5.16 0.90 1.17 20 10.5-------------------------------------------------
Sultan considers there are reasonable prospects for eventual economic extraction of this resource. Intermine has completed preliminary mine designs for both John Fardy and Peelwood and continue to manage the processes necessary to obtain regulatory approvals required to commence mining operations at both prospects.
Metallurgical Test Work
SSC engaged Metallurgical Design to establish recovery characteristics of zinc, copper, lead and silver minerals. Metallurgical Design has also been responsible for optimising plant configuration for ore treatment. In August and September, AMM was subcontracted by Metallurgical Design to conduct metallurgical test work of the John Fardy ore. Results of the test work are as follows:
- Sulphide minerals are readily liberated at both 75 micron and the coarser 106 micron;
- Both grind recoveries of zinc, copper and lead are all well in excess of 90% and generally more than 95%;
- Finer grinding is not required to enhance floatation performance; and
- Very good Flotation Bulk Concentrate Recovery = 43.5%.
Table 4 - Recovery of Base Metals
--------------------------------------------Base Metal % Recovery Head Grade Conc. Grade --------------------------------------------Zinc 96 9.9 22.2Lead 97.7 2.0 4.6 Copper 98.3 0.7 1.5Sulphur 96.8 17.7 39.3--------------------------------------------
Exploration at Peelwood is at an earlier stage than at John Fardy and independent metallurgical test work has not been undertaken. Sultan's Chief Geologist stated "The mineralisation at Peelwood is broadly similar in style to mineralization at John Fardy".
Preliminary Project Indicators
Sultan has engaged McSweeney Partners Pty Ltd to conduct engineering design and a costing study based on a 120-150ktpa treatment plant.
Preliminary assessment suggests the capital costs would fall within the expected values.
Sultan's Managing Director, Mr. Derek Lenartowicz said "The characteristics of John Fardy prospect indicate that Sultan Corporation will end up with a project that has a relatively low capital and operating cost due to the anticipated simplicity of the ore treatment circuit."
Description and notes on the John Fardy and Peelwood Resource Estimates
Calculation of Zinc Equivalence
Zinc is the major mineral of economic value. The zinc equivalent grade has been calculated by adding the zinc grade and the adjusted grades of copper, lead and silver. The grades of copper, lead and silver have been multiplied by factors that express the assumed relative prices of the metals.
Zinc equivalent % = Zn% + 4.0Cu% + 1.0Pb% + 0.01Ag g/t.
The assumed metal prices are zinc USD 0.50 per pound, copper USD 2.0 per pound, lead 0.60 per pound and silver USD 10.0 per ounce and are based on prices of these metals in the period October 2008.
In August and September 2008, AMMTEC Ltd of Perth, Western Australia conducted metallurgical test work of the John Fardy ore. The sulphide minerals are readily liberated at both 75 micron and the coarser 106 micron. For both grinds recoveries of zinc, copper and lead are all well in excess of 90% and generally more than 95%. The metallurgical test work suggests the recoveries of the major elements of value are similar and the relative metal prices are a good basis for calculating a zinc equivalent grade. Exploration at Peelwood is at an earlier stage than at John Fardy and independent metallurgical test work has not been undertaken. It has been assumed that Peelwood would have similar metallurgical characteristics to John Fardy.
Competent Personnel Responsible for the Resource Estimate
The resource estimate for John Fardy has been estimated on behalf of Sultan Corporation Limited by Chris Black of Cube Consulting Pty Ltd. Chris Black has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Person(s) as defined in the 2004 Edition of the "Australasian Code for Reporting of Mineral Resources and Ore Reserves". Chris Black consents to the inclusion in the report of the matters based on their information in the form and context in which it appears in Table 2. Cube Consulting is an independent Perth based resource consulting firm specializing in geological modeling, resource estimation and information technology.
Contact
Derek Lenartowicz
Managing Director
Tel: +61-8-6365-4519
Fax: +61-8-9388-6040
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