WFEMF / WOF News - Woulfe Sangdong project NPV increases 34% to US$535.2M
November 6th, 2012 -- Vancouver, Canada -- Woulfe Mining Corp. ("Woulfe" or the "Company") (TSX-V: WOF, OTCQX: WFEMF, Frankfurt: OZ4) is pleased to announce that it has awarded a mining development and production contract to Youngin Industries Corporation ("Youngin") for the underground development and extraction of 1.2 million tonnes per annum from the Sangdong mine. The contract encompasses all mine civil works, mine development and production of Tungsten/Molybdenum ores, to be delivered from underground to the primary crusher. The contract pricing will result in the lowering of mine production costs by 49% and will increase the project NPV8 from US$400.3 million to US$535.2 million, taking IRR from 46.0% to 65.6%.
Woulfe awarded the contract to Youngin after extensive negotiations with six Korean mining, civil and tunneling contractors. The contract was awarded based on Youngin's extensive experience and expertise in underground mining and civil construction.
The Youngin mine production plus pastefill costs totals $25.64 per tonne of ore mined compared with $38.30 per tonne mined estimated in the Feasibility Study. This improvement in costs came as a result of replacing projected Canadian mine costs in the Feasibility to firm Korean costs. Other benefits include reduced capital allocation (US$20 million) for the mine fleet and subsequent reduction in pre-production ore mining and mine development costs.
Tetra Tech is working on updating the mineral resources to include the last five months of drilling. With this update an updated addendum of the feasibility will be released that will include the revenue from byproducts and the benefits resulting from the lower mining cost. Reducing the mining cost will have a significant impact on mine cut-off grade which will be expected to increase the resource base.
The CEO Brian Wesson stated "the lower mining cost results in a NPV in line with the company's expectations and prior valuation. The project is robust and low risk as Korea is an OECD developed country."
Youngin boasts extensive experience in both mining and civil engineering in Korea. Youngin provides a significant level of experience and brings with it an extensive modern mine fleet Mr Wesson went on to state "Woulfe is confident in the highly skilled staff at Youngin. Their management have over 20 years of experience in mining and tunneling and this expertise will be a valuable contribution to the mine."
Youngin began the civil construction of the mine portal in October 2012, after which the mine development will proceed. The six metre square cross section development is expected to hit the main ore zone in November 2012 with trial mechanized mining to begin in December 2012.
The scientific and technical information in this release has been reviewed and approved by Jon Gliddon C.Eng, General Manager UK for Tetra Tech, and overall manager for the Sangdong feasibility study announced on April 23, 2012.Mr. Gliddon is an Independent Qualified Person within the meaning of NI 43-101.
On Behalf of the Board of Directors
Woulfe Mining Corp.
"Brian Wesson"
Brian Wesson (FAusIMM)
President, CEO and Directo
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