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Golden opportunity for Lappland Goldminers AB

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15:35 CEST+02:00
Lappland Goldminers AB said it has applied for a court permit to start mining and processing gold at a site at Fäboliden, near the northern town of Lycksele along Sweden's 'Gold Line'.

The planned mining and processing facilities would have a capacity to extract 5 million tons of gold ore a year.

Lappland Goldminers' chief executive Karl-Ake Johansson told AFX News that depending on the grade of the ore, the level of extraction should result in around 300,000 ounces of gold per year, worth 1.40 billion kronor (185 million US dollars) at today's gold price of 617 dollars an ounce.

The company spends around 100 million kronor a year searching for gold in Lapland, but this is its first application to actually begin mining operations.

Johansson said the planned facilities will take around 18 months to construct, and require an investment of 1.2 bln skr, when and if the court grants permission.

He said he is confident the court will clear the application but is uncertain as to when. In the best case scenario he sees a go-ahead being granted before year end, but concedes it may not come before well into next year.

"It's a court matter, we don't know how many other cases they have on their hands, but possibly before the end of this year," said Johansson.

Lappland Goldminers already owns some of the land on which mining is scheduled to start and is actively buying up the remainder from private owners.

Johansson said the technology for extracting gold is well established and he is confident Lappland Goldminers can extract the Fäboliden gold at "low cost".

He said the mine would create around 200 jobs.

AFX

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