Letter of Intent signed

RNS Number : 3671V

Beowulf Mining PLC

09 July 2009

 

9 July 2009

Beowulf Mining Plc

('Beowulf' or the 'Company')

Ruoutevare Letter of Intent

Beowulf (AIM: BEM; Aktietorget: BEO), the AIM and Aktietorget traded mineral exploration company which owns several exploration projects in Northern Sweden, is pleased to announce that during a recent visit to China its Chairman, Clive Sinclair-Poulton, signed a non-binding letter of intent with Shanghai-based China Hua Dong Corp. Limited ('CHDC') for the potential future supply of iron ore concentrate from the Company's Ruoutevare project based in Northern Sweden. 

The Company recently announced that it had commissioned further metallurgical tests on material from its 100%-owned Ruoutevare magnetite-ilmenite deposit from MINPRO AB's research laboratory at Stråssa, Central Sweden. Previous results have confirmed that by applying reduction techniques in a laboratory scale simulation of a mechanical oven, it is possible to fully extract iron, titanium and vanadium from the Ruoutevare titanium-magnetite ore. The results of the further test programme are expected to provide the basis for a preliminary economic evaluation study of the project, following which pilot plant studies can then be planned. It is also intended that potential clients, such as CHDC, will be able to test the products obtained for their commercial quality.  

Clive Sinclair-Poulton, Chairman of Beowulf commented: 

'As previously announced, we are committed to demonstrating the commerciality of our various projects in Northern Sweden. My recent visit to China has enabled me to gauge at first hand the potential medium and longer term demand for natural resources from such a significant consumer. Earlier this year, we were approached by a number of Chinese companies and I am highly encouraged by the signing of a letter of intent with CHDC. I look forward to establishing a long-term strategic relationship with them, and other potential customers, in anticipation of the next global economic upturn.'

Enquiries:

Beowulf Mining Plc
Clive Sinclair-Poulton, Chairman	Tel: [phone]
Strand Partners Limited
Simon Raggett / Matthew Chandler	Tel: [phone]
Alexander David Securities Limited
David Scott / Nick Bealer	Tel: [phone]
Lothbury Financial Limited
Gary Middleton / Ron Marshman	Tel: [phone]
or visit http://www.beowulfmining.com

Notes to editors:

The Ruoutevare Magnetite Project is 100%-owned by Beowulf and covers 850 hectares. It is located approximately 1,100km north of Stockholm in the Norrbotten County and approximately 13km north-west of the minor village of Kvikkjokk. The 2.3 billion tonne Kiruna iron ore mine, the world's second largest underground mine, is located approximately 150km northeast and the Malmberget iron ore mine is located 120km to the east. Ruoutevare literally translates as 'Iron Mountain'.

In October 2006, the Raw Materials Group ('RMG') of Sweden completed an independent conceptual study on the Ruoutevare iron/titanium deposit. Based on a simplified cash flow analysis for an eight year open pit operation extracting at a rate of 10 million tones per annum, the study produced annual cash flows of just over US$50 million from revenues of US$218 million, using various price and cost assumptions. The study was based on the then prevailing forecasts of revenues, capital and operational costs applied to a life of mine financial model.  

In August 2008, Beowulf announced an Inferred Mineral Resource estimate compliant with JORC standards on Ruoutevare showing 140 million tonnes (Mt) grading 39.1% iron (Fe), 5.7% titanium (Ti) and 0.2% vanadium (V) (cut-off grade of 30% Fe).  

In addition, the Company also owns 100% of the nearby Kallak Magnetite Project, which has total target iron mineralisation of more than 120 million tonnes across two deposits at grades varying between 35-42% Fe. 

 

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