Name of the Project
Salave gold project.

Location
Asturias, in northern Spain.

Client
Black Dragon Gold Corp.

Project Description
A positive preliminary economic assessment has concluded that Salave can produce more than 1.1-million ounces of concentrate over 14 years.

The project will use vertical retreat and sublevel stoping. Rock and paste fill will be used as backfill to maximise mining recovery.

The processing of Salave mineralised material has been limited to crushing, grinding and flotation, with concentrates exported through local ports. Mine feed will be crushed on surface at a rate of 700 000 t/y and then be processed through conventional semiautogenous grinding and ball milling followed by sulphide flotation and thickening.

Average production has been estimated at 79 200 oz/y of gold in concentrate at an average grade of 59.7 g/t of gold.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value (NPV), at 5% discount rate, of between $239.2-million and $353.2-million, with base case NPV at $296.2-million. The project has a pretax internal rate of return (IRR) of between 23% and 35%, with a base case IRR at 28%.

A payback of 3.8 years is expected.

Value
Preproduction capital is estimated at $95.3-million.

Duration
The construction of the plant is expected to take nine months with concurrent 18-month underground mine development.

Mineralised development material is expected to be processed 12 months from the start of plant construction.

Latest Developments
A prefeasibility study is planned for October this year.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Black Dragon Gold Corp, tel +44 20 7993 4077, fax +44 20 7112 8814 or email info@blackdragongold.com.