Beowulf shares rise as the drilling begins on Kallak South

Beowulf Mining (AIM: BEM) announced today that drilling has begun on its Kallak South iron ore deposit in northern Sweden with assay results expected by the end of the year.

The programme will consist of 32 holes over a total length of 3,500 metres and will be carried out by local firm Ludvika Borrteknik, which is using two light moveable rigs. 

It will allow the company to compile a JORC-compliant resource.
In order to assess the quality of ore relative to that of the neighbouring Kallak North deposit, the company is planning to commence bench scale metallurgical tests.

The tests will be conducted by the Minpro research laboratory in Stråssa, central Sweden, on selected large samples of ore grade drill core sections of the deposit.

And they will be directed towards the production of a high grade magnetite pellet feed product for use by potential clients, the company said.

Chairman Clive Sinclair-Poulton added: "We are delighted to confirm that drilling has now commenced on the Kallak South deposit where we believe that there is considerable potential.

“The drilling programme is designed to confirm the quantity and quality of the iron ore in the licence area to then enable a JORC compliant resource estimate to be obtained.

“The initial assay results from the Kallak North drilling programme were very positive and the Kallak South deposit has the potential to be a significantly larger resource. We look forward to receiving the results."

Separately, the Beowulf has signed a letter of intent with Ludvika Borrteknik to begin a 4,000 metre drill programme on its Ruoutevare project area, also in northern Sweden.

Sinclair-Poulton believes Beowulf is destined to be a “major player in the European iron ore sector”.

The market seems to agree. The shares jumped 2.25p, or 14 per to 18p cent in early trade and have advanced 160 per cent in the past month.

Again today the stock inched a little higher – it is up 10 per cent after an upbeat appraisal of its Kallak iron ore project.

Today’s news confirmed “extended mineralisation” at Kallak North, which has an estimated resource of 150 million tonnes, with grades above 30 per cent.

However more interesting was the company’s preliminary assessment of Kallak South. 3D modelling revealed it is a “substantially larger” iron body than the northern deposit.

The company said the “Kallaks” may form a combined potential resource of several hundreds of million tonnes of iron ore.

Put together with the 140 million tonnes at Ruoutevare, which is 60-odd kilometres up the road, and one can understand why the chairman and the market are getting quite exited.

Earlier this month the group raised £400,000 via a placing of shares at 5.75p each to continue its aggressive drilling programme.

As well as Kallak and Ruoutevare, the company has a half share of the Balleck copper-gold project in northern Sweden as well having uranium, gold and molybdenum assets.