BEIJING, Oct. 2, 2008 (GLOBE NEWSWIRE) -- Silver Dragon Resources Inc. (OTCBB:SDRG) is pleased to announce that it has engaged Beijing Ten-star Technology Ltd., a Chinese project management and consulting service provider, for a feasibility study on project development of the Erbahuo silver mine, which is Silver Dragon's flagship property in northern China.
Silver Dragon intends to develop its Erbahuo silver manganese deposit and construct a 150 tonne per day underground mine and processing plant in Wengniute County, Chifeng City, Inner Mongolia, China, which is expected to be fully operational before the end of 2009.
The scope of the project includes the development of the Erbahuo mine, the mineral processing plant and all related facilities. The final scale of the project will be a mine that can produce 150 tonnes per day of silver ore, a mineral processing plant that can produce over 50 tonnes per day of manganese sulphate and 1,000 ounces per day of silver.
The development of the Erbahuo project is planned in stages:
-- Stage One: To build a mineral processing plant that can produce
manganese sulphate with a capacity above 50 tonnes per day.
-- Stage Two: To build the mine with a capacity of 150 tonnes per
day.
-- Stage Three: To build a mineral processing facility with a
capacity of 150 tonnes per day.
The feasibility study consists of the following tasks:
-- To collect all information that is needed to carry out the
study;
-- To carry out a full process lab test work using ore samples
from site;
-- Process design and major equipment configuration;
-- Layout design;
-- Major equipment and raw material inquiring and investment
estimation;
-- Project schedule and cash flow estimation;
-- Economical analysis.
The feasibility study is expected to be completed within three months. To date, Ten-star has taken 150kg of ore samples from the site and 50kg of coal samples from the local region and shipped them to labs for process test work. Meanwhile, a study on the mining plan is also underway.
In a parallel development, Silver Dragon has also commenced a new exploration program at Erbahuo silver mine for the purpose of further expanding its resources, especially the polymetallic sulphides at greater depths. The program consists of geophysical surveying, drilling and tunnelling. To date, the geophysical surveying competed has revealed great potentials for in-depth mineralization. Preparations are underway to drill and verify the mineralization targets that have been defined by those geophysical survey results.
About Beijing Ten-Star Technology, Ltd.
Beijing Ten-star Technology Ltd. is a Chinese project management and consulting service provider that is based in Beijing. The Ten-Star consulting team has significant experience in the mining project development all over China and the Asian region. The team consists of experts in project management, process engineering, mineral process mining, civil engineering and construction, mechanical engineering, etc. The team leader is Mr. Xu Hao, who has six years experience in the metallurgical industry and 13 years experience in the mining industry in China, Australia and the Pacific Islands, covering a broad range of areas including study management, project management, engineering coordination and equipment manufacturing management. He served as deputy project manager of the Jinfeng Gold project - the largest Biox acid plant in the world and the largest Gold plant in China, and was involved in engineering, procurement management and overall project coordination. He has specialist expertise in hydrometallurgical extraction processes, including alumina refining, cobalt, nickel, manganese, vanadium and titanium. Mr. Xu and his team are well acquainted with Silver Dragon's Erbahuo property through their involvement in a status evaluation study project commissioned by Silver Dragon to Ausenco Ltd. in January, 2007.
About Erbahuo Silver Mine
Erbahuo silver mine covers an area of 1.2 square kilometers. It is located 120 kilometers northwest of the city of Chifeng, which is 450 kilometers northeast of Beijing, China and comprises the Erbahuo mining district, part of the prolific silver belt on the structural join where the north edge of the North China platform meets with the south edge of the Hercynian fold belt of the Great Xingan Mountains. The deposit is a shear zone hosted and stratabound volcanogenic hydrothermal system of parallel trending and dipping mineralization containing pyrolusite, psilomelane, limonite, pyrite, galena, sphalerite, chalcopyrite, and other silver related mineralization. Silver is concentrated within manganese oxides. Erbahuo used to be considered a silver manganese mine in a fracture zone. In recent years, however, the features of strata bound Ag deposits have been discovered, suggesting the potential for significant further resources in sulfides that contain silver, copper, molybdenum and other metals.
An NI43-101 technical report on this property was completed in July, 2007, by Micromine Consulting ("Micromine"), a resource sector software developer and consulting company headquartered in Perth, Australia.
The Erbahuo silver mine is wholly-owned by Sanhe Sino-Top Resources & Technologies Ltd. ("Sino-Top"), a Chinese company of which Silver Dragon currently owns 90% and shall own 40% after receiving Ministry of Commerce approval as per the equity transfer agreement with Huaguan Industrial Corp. (see press release of July 14, 2008). Under the same agreement, Erbahuo Silver Mine will be spun off from Sino-Top and be put under a separate entity, i.e. Chifeng Silver Dragon Resources & Technologies, Ltd. ("Chifeng Silver"), an American-Chinese joint venture that will be 70% owned by Silver Dragon upon completion of the relevant government approval process.
About Silver Dragon Resources Inc.
Silver Dragon Resources Inc. is a mining and metal company focused on the exploration, acquisition, development and operation of silver mines in proven silver districts globally. Silver Dragon's objective is to acquire silver mining assets that contain promising exploration targets, have highly leveraged, out-of-the-money silver deposits, and/or are producing properties with significant untapped exploration potential. It is management's objective to grow Silver Dragon into a significant silver producer by developing the Cerro las Minitas and Erbahuo projects in Mexico and China respectively. For more information, please visit the Company's website at: www.silverdragonresources.com (now available in Chinese).
The Silver Dragon Resources Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4242
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained herein which are not historical, such as statements regarding the exploration and development of the Liangdi Silver Project, outcome and timing for the completion of further assays and metal amounts in partial assay results, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "aims," "potential," "goal," "objective," "prospective," and similar expressions, or that events or conditions "will," "would," "may," "can," "could" or "should" occur. Information inferred from the interpretation of assay results and information concerning mineralization zones may also be deemed to be forward-looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, certain delays beyond the company's control with respect to future assay results, delays in testing and evaluation of assays, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.