The life of mine capital cost estimate for fixed plant items is US$60.2 million. This includes US$20 million for the processing plant, $19.4 million for the access decline, US$7.0 million for engineering, procurement, and construction management and US$4.3 million for sustaining capital.
Project cash flows, expressed in millions of US dollars, are summarized below:
At an assumed gold price of US$1,600 per ounce, the Muguk project returns a substantial positive net cash flow. The undiscounted net pre-tax cash flow is US$68.6 million. The net discounted pre-tax cash flow, using a real pre-tax discount factor of 8%, is US$31.8 million. Payback of capital (in both discounted and undiscounted terms) is achieved during Year 6 of operation. The internal rate of return (IRR) is 22%.
Woulfe cautions that the PEA is preliminary in nature. It is based on an inferred mineral resource. Inferred resources are based on limited information, and grade continuity has been assumed, but not verified. Mineral resources are not mineral reserves and do not have demonstrated economic viability. There is no certainty that all or any part of the mineral resource that is the subject of the PEA will be converted into mineral reserve. No mineral reserves were estimated as part of the PEA.
However, the positive outcome of the PEA does provide Woulfe with the incentive to continue to advance the Muguk project. Resource confirmation work on the Three Brothers Vein and exploration of the numerous smaller veins within the gold field are recommended. This work can most effectively be undertaken from underground drill sites.
The report of the PEA in this release has been reviewed and approved in the form and context in which it appears by Woulfe's mining advisor, Mr Edward Gleeson MAusIMM (CP), BEng (Mining), of AMC Consultants Pty Ltd. Mr Gleeson has appropriate qualifications and sufficient relevant experience to qualify as a Qualified Person for the reporting of a PEA for the Three Brothers Vein of the Muguk Gold Mine.
1Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, The JORC Code 2004 Edition, Effective December 2004, Prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (JORC).
On Behalf of the Board of Directors
Woulfe Mining Corp.
Brian Wesson (FAusIMM)
President, CEO and Director
About Woulfe Mining Corp.
Woulfe Mining Corp. is a TSX-V listed company with a diversified portfolio of mining licenses for tungsten, molybdenum, gold, base metals and uranium-vanadium in South Korea.
The company's current projects include the Sangdong tungsten-molybdenum mine, historically, one of the largest tungsten mines in the world; the Muguk gold-silver mine, formerly South Korea's largest gold mine, as well as a number of other properties with significant known mineralization and excellent regional exploration potential.
Woulfe has high expectations for near-term, low-cost production. The company has assembled a highly skilled, in-country, bilingual technical team and a board of directors with an outstanding track record of success.
For more information, please contact -
Nicola Street Capital
Mobile phone +1 (415) 595-0865
Renmark Financial Communications
Office phone +1 (514) 939-3989
Woulfe Mining Corp.
+1 604 684 6264
+1 604 684 6242 (FAX)
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-looking statements and forward-looking information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. We have made certain assumptions about the forward-looking statements and information and even though our management believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that the forward-looking statement or information will prove to be accurate. Furthermore, should one or more of the risks, uncertainties or other factors materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements or information. These risks, uncertainties and other factors include, among others, the following: commodity price volatility; discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries; mining operational and development risk; litigation risks; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign investment; currency fluctuations; speculative nature of mineral exploration; global economic climate; dilution; share price volatility; competition; loss of key employees; additional funding requirements.
There can be no assurance that forward-looking statements or information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, you should not place undue reliance on the forward-looking statements or information contained herein. Except as required by law, we do not expect to update forward-looking statements and information continually as conditions change and you are referred to the full discussion of the Company's business contained in the Company's reports filed with the appropriate regulatory authorities.
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