* May hold up to 250 mln tonnes vs current 140 million
* Nearby Kallak deposit also to be upgraded-company
By Julie Crust
LONDON, Feb 23 Mineral explorer Beowulf Mining
Plc (BEM.L) has lifted iron ore estimates for its flagship
Ruoutevare deposit in northern Sweden to as much as 250 million
tonnes from the current 140 million.
"We believe that with the work we have done, and with the
work that the Geological Survey of Sweden have done, that
Ruoutevare contains around 200-250 million tonnes," Chairman
Clive Sinclair-Poulton told Reuters during a recent trip to the
"Every 10 million tonnes is an extra $200 million," he said.
Shares in the micro miner jumped as much as 25 percent this
month after a study by Swedish-based consultancy Raw Materials
Group showed the project to have potential cash flows of $3
billion over a 15-year mine life and that it could support an
open pit operation. [ID:nLDE61E0AE]
A resource of 250 million tonnes would extend the life of
Ruoutevare - which means Iron Mountain - to 25 years.
AIM-listed Beowulf is currently valued at about $6 million.
Beowulf said it could start drilling at Ruoutevare this year
and hopes to begin production in three to five years.
Another upcoming report by Raw Materials Group on Beowulf's
Kallak iron ore deposit, around 85 km from Ruoutevare, was
expected to show a rise in its resource to 150 million tonnes
from 120 million, Sinclair-Poulton said.
Beowulf is looking at constructing a processing plant at
Ruoutevare, which would be able to process Kallak ore, and to
build a slurry pipe to carry the resulting concentrate to the
Norwegian port of Narvik, the company said.
IRON ORE POTENTIAL
The two projects are among the largest known iron ore
resources in Sweden yet to be commercially developed. Sweden's
state-owned LKAB, one of the world's top producers of iron ore
pellets, traditionally has a strong presence in the area, making
it a strong potential partner or future buyer of the deposits.
The properties are inside the Arctic Circle but are close to
good infrastructure, due to the presence of the mining and
Many of the roads and frozen lakes are used by automakers to
test cars in harsh winter conditions.
The Raw Materials Group said environmental permitting could
be a sensitive issue in the area which is used for reindeer
herding by the Sami community.
Beowulf has switched its focus towards iron ore production
as it seeks to take advantage of rising demand from Chinese
steelmakers, the world's biggest users of iron ore.
Steelmakers are looking to diversify supply to reduce their
reliance on the world's three top iron ore miners: BHP Billiton
(BHP.AX)(BLT.L), Rio Tinto (RIO.L)(RIO.AX) and Vale (VALE5.SA).
Beowulf last year signed an outline supply pact with China
Hua Dong Corp. Ltd.
(Editing by David Cowell)