Corporate Overview
King Island Scheelite Limited was originally named GTN Resources NL, which produced tin and various metals in Queensland, as well as sapphire mining operations in New South Wales.
GTN exited from these operations, and purchased the rights to the mineral tenements on King Island through its acquisition of Australian Tungsten Pty Limited. To reflect this new focus, GTN changed its name to King Island Scheelite Limited (KIS).
The King Island development is the major asset of the company. Between 2005 and 2006 KIS undertook a study to examine the prospects of reopening the mine, given the remaining resource and strong recovery in tungsten prices since the former mine closed in 1990.
KIS entered joint venture agreements with Hunan Nonferrous Metals Corporation Limited (HNC) in December 2007. These agreements established an equal share unincorporated joint venture - the Dolphin Joint Venture (DJV) to develop the King Island resource. In addition HNC subscribed for 4,450,000 shares in KIS and was granted a seat on the KIS Board.
In 2009 Simon Bird was engaged as Chief Executive Officer, a new project office was set up and joint venture conditions precedent completed. The DJV Committee established an agreed work programme to take the project forward. This focussed on;
1. Mine
a. Completed geotechnical drilling to test ground conditions east of the open pit and under the planned cut off wall.
b. Confirmed JORC resource & reserve at nearby Bold Head.
c. Assessed potential for high grade extension to Dolphin deposit.
d. Developed a viable underground mine plan at Dolphin.
2. Mill
a. Conducted whole ore flotation tests on King Island ore in China.
b. Developed new flow sheet and mine design based these excellent test results.
3. Economics
a. Continued to experience increases in tungsten prices (over 40% in US$ terms since June 2009).
b. All capital and operating cost assumptions have been reviewed.
c. Confirmed potential for acceptable returns from Dolphin underground development.
Subject to approval by both joint venture partners full engineering design and revised approvals are expected to take 6-9 months. This would be followed by procurement and construction activities which could take up to two years. Potential to reopen the Bold Head mine and access additional tonnes as an extension to the Dolphin mine offer further upside.
KIS entered joint venture agreements with Pleiades Resources Pty Ltd to explore an area of historic high grade copper and tin-tungsten mineralisation. The Balfour Joint Venture (BJV) was established in 2009 and ground based gravity surveys undertaken with encouraging results. An initial drilling phase was carried out in late 2009 and once necessary approvals granted a second phase commenced in June this year. The market has and will continue to be updated on the results of these activities.
KIS continues to look for opportunities to grow and to that end is actively assessing potential strategic alliances to increase future sustainable production.