Update on the gold project Haveri

Under oktober genomförde Mahvie Minerals en riktad nyemission på 6,5 miljoner kronor till ett antal kvalificerade investerare i syfte att skapa utrymme för att utveckla guldprojektet Haveri. Som tidigare meddelats var också emissionskostnaderna låga, bedömt c:a 150 KSEK vilket gör att Mahvie Minerals kommer att kunna använda huvuddelen av emissionslikviden till projekt-utveckling. Vi är mycket glada för det stöd som investerarna visat och vi tycker att det visar på Bolagets och projektets styrka att kunna finansiera denna typ av satsningar i dagsläget.

In October, Mahvie Minerals completed a directed share issue of SEK 6.5 million to a number of qualified investors in order to create space to develop the Haveri gold project. As previously announced, the issue costs were also low, estimated about 150 KSEK, which means that Mahvie Minerals will be able to use the majority of the issue proceeds for project development. We are very pleased with the support shown by the investors and we think it shows the strength of the Company and the project to be able to finance this type of investment at this time.

The background to the issue is that at the end of August the Company received an extension of the outstanding ore exploration permit. The extension, together with the protection zone previously granted to the company, means that planning for the development of the Haveri project can now begin in earnest.

Haveri – a brownfield project

Haveri is, like the Company’s project in Mo i Rana, a so-called “brownfield project”, i.e. where there has previously been mining. In Haveri, the mine last operated from 1942 until 1962 when the mine was closed after a fire. Since then, the area has been subject to extensive exploration. In 2000, the mine was drained of water to facilitate further exploration. Since the mine closed in 1962, over 250 exploration holes have been drilled, totaling over 32,000 meters, however, not all drill holes are known (i.e. noted on available maps) or available for full analysis. In total, an extraordinarily large number of boreholes are available and incorporated into a data base. We are now working to finalize a coherent database of the Haveri area, which will provide a good detailed basis for further development.

In our previous project update of October 24 on the Mo i Rana project, we described some of the reasons why the Mo project is highly interesting. The area around Mo is very interesting geologically and Mo i Rana is also geographically very advantageous with immediate access to sea transportation. In addition to these strong advantages, the project should be assessed in the light of current conditions with higher metal prices and new technologies, which allow more efficient mining than when the Mo i Rana mine was operating in the 1980s. For Haveri, many of these benefits are also present, and it is also providing new opportunities since the mine was closed in 1962. The advantages of brownfield projects are that the risks are reduced. There is almost always ore in the ground because of the price increases over the last thirty years. There is often a good information base and then the geological risk is reduced when there has been ore on the site. In addition, the technical risk is reduced as the ore could be enriched earlier.

The mine in Haveri consists of an opencast mine which then became an underground mine. The main shaft of the mine is about 120 meters in diameter and about 70 meters deep. In addition, there is something that has been called the tourist cave since the mine closed and a number of smaller caves (former mine tunnels). When mining was suspended, the mine was filled with water and since then the main shaft and caves have been used by sport divers. Overall, the whole geometry is relatively complex and there are reports of several divers getting lost and dying on different occasions. Nowadays the mining area is closed.

A diamond in the rough

The initial work done by Mahvie Minerals indicates that the Haveri is a rough diamond that now needs to be developed, polished and refined to reveal its true value. Various earlier documents provide a variety of different – and sometimes contradictory – descriptions of residual mineralization and its distribution in the bedrock. Thus, as in the case of Mo i Rana, these results need to be updated, consolidated, contradictions managed and all data quality assured. However, this work has been somewhat easier for Haveri than for the Mo i Rana case, as the Haveri project had several different mineral resource assessments to work from.

In addition to the geological data processed, there is also an existing economic assessment of the Haveri project. The most comprehensive, and most recently completed, is the Preliminary Economic Assessment (PEA) conducted by the consulting firm SRK in 2014 (available on the Mahvie Minerals website). It states that, with the mine layout presented at the time and with the gold prices and production costs then prevailing, the project was marginally profitable.

Reinterpretation of previous analysis results

Mahvie Minerals is now reinterpreting the previous preliminary economic assessment for the Haveri project made by SRK in 2014. It is clear that with today’s price and cost levels and new knowledge, the conditions for mining are completely different. SRK’s assessments were based on an idea of an open pit mine with relatively low gold content, 0.93 g/tonne gold equivalent, the gold and copper grades of the ore converted to gold values by taking into account metal grades and prevailing prices, and with relatively low geological knowledge, i.e. inferred, mineral resources.

However, an earlier analysis by Lappland Goldminers, a former owner, shows that a mine layout that primarily targets areas with high gold content is significantly more profitable. In Lappland Goldminer’s internal analysis, which is not compatible with international standards such as NI 43-101 or JORC, the project shows an interest rate of almost 80% at a gold price that was just over half of what it is today.

New conditions

What emerged from the analyses of existing geological data, estimated mine layouts and economic assessments is a development idea where the focus of future work is on the mapped but unbroken areas with higher gold grades. It is a strategy where all geological knowledge and legacy modeling work is utilized and combined with new technical know-how to plan a drilling program aimed at verifying higher grade areas and increasing the geological knowledge of these areas. In this way, the conditions for profitable mining are significantly increased.

The aim of the next phase of work is to carry out a drilling program as soon as possible – as it generates the most reliable information on the deposit – but before that, existing information must be studied with the new development idea in mind. The immediate priority is to develop a clear time- and cost-based development plan to progress the project from the current PEA status to a final feasibility study (DFS) in the shortest possible time.

In addition to focusing on value instead of volume, Mahvie Minerals today has completely different conditions than when the previous owners worked on the project: stable higher gold prices, new technology on the exploration side and new enrichment technology.

Future development of Haveri

In order to develop the project, the Company is currently working on three scenarios: a mine layout according to SRK 2014, larger open pit, lower gold grade; a possible mine layout with a higher gold grade, closer to 2 g/tonne and a smaller tonnage but still reasonably large; a “surgical mine” with low tonnage but a much higher gold grade, similar to the example of Lappland Goldminers above. Which of these scenarios is ultimately worth developing in more detail will be answered by future drilling.

To give some perspective: a comparison between different Finnish gold projects, e.g. Northgold’s Kopsa (16.6 Mton @ 1.03 Aueq) and Mawson Rajapalot (9.8 Mt @ 3.0 g/t AuEq) showed that Haveri is very attractive even if the project would be slightly smaller in volume than the current 58 Mton @ 0.93 g/ton Aueq. The goal of the upcoming project development is to create a decision-making basis for further project development as described above and to strengthen the geological knowledge (so that we can achieve known and indicated mineral resources rather than inferred), i.e. primarily to increase the knowledge of where the ore with the high content of gold is located.

What happens next?

The project is currently procuring geological development and some initial modeling prior to drilling. Initial contacts with potential drilling contractors have been made and we expect to start drilling no later than Q1 next year. The procurement of local geology consultants and mine development support is expected to be finalized in November, after which the drilling services are primarily procured.

To sum up, things are going according to plan and we look forward to delivering good results in the near future. First comes the procurement of future work packages, planning work with prospective contractors and planning a first drilling program. Through these steps, we will have a clear, detailed picture of how the Haveri project will be structured to get into production and reach its goal.

How do we know that there are areas with higher gold content?

The table below, taken from a previous owner, Northern Lion Gold (NGL), shows the results of some of the drill holes completed by NGL between 2004 and 2007. The columns in the table show the hole identification (Hole ID), where in the project area it was drilled (zone), the length of the interval where gold mineralization was identified (interval) and the average grade over that interval (grade Au g/tonne). As shown above, the average grade of the ore, i.e. the part of the bedrock where the gold is found, was estimated to be 0.93 g/tonne (SRK 2014). In NGL’s wells, shorter intervals with significantly higher grades are found. In general, the gold content in open pit mining should be at least 1 g/tonne, preferably 1.5 g/tonne and underground at least 2 g/tonne. Higher gold prices can of course tolerate lower grades, but since there are inevitably losses in enrichment and transportation, there is almost always a minimum possible grade to mine at, probably close to what SRK presented in 2014.

Hole ID Sun Interval (m) Halt Au g/tonne


The mine 119.45






The mine 91.70




MW-02 The mine 10.50




MW-03 The mine 31.50



8.28 VG

MW-08 The mine 5.20 5.10
MW-09 The mine 11.20 4.04 VG
MW-I I The mine 7.00 4.23


shaft 21.05







shaft 20.00






Sw-02 SW “Copper” 5.37




Gold price and the gold market

Gold is a metal that almost everyone has a relationship with. We buy and give away gold at major life events such as births and weddings. Almost everyone wears some form of gold, whether it’s jewelry or (wedding) rings. One reason is of course that gold is a metal that is relatively easy to shape, pure gold, 24 carats, can be pressed in with a fingernail, but gold is also an established store of value. Owning gold has historically been a way to protect yourself from economic fluctuations. This is also the case today. According to the US Geological Service (USGS), the established reference for metal statistics, the major use of gold is jewelry making, 47% of all gold, followed by gold bullion for investment 37%, gold coin and medal making 9%, industrial use, most commonly in electronics 6%, and other 1%. Gold bars for investment can be made by individuals, but most commonly central banks own gold. The Federal Reserve of the United States is the world’s largest holder of gold with over 8,000 tons in the Fort Knox vault. Other major owners of gold are (in descending order): Germany, 3,352 tons, the International Monetary Fund, IMF, 2,814 tons, Italy, 2,451 tons, France 2,436 tons, the Russian Federation, 2,333 tons and the People’s Republic of China, 2,191 tons, all according to the International Financial Statistics.

The price of gold has always fluctuated and gold has been traded in many currencies. Today, the most common international quotation is USD/oz. i.e. US dollars per Troy Ounce, 31.1g. During the Depression, the price of gold was locked by then US President Roosevelt at 35 USD/Oz, although it varied somewhat, between 33 USD/Oz and 35 USD/Oz (this is a slight simplification of Roosevelt’s decision and subsequent events, but the consequence was a virtually fixed gold price in US dollars for a long time). Following increased economic pressure on the US economy in the early 1970s, gold was released against the dollar and has since gradually increased in price to an all-time high of 2063 USD/Oz in mid-2020. At the time of writing, the gold price is around 1950 USD/Oz and most analysts see a continued strong gold price. The long-term consensus price among international bank economists is around 1815 USD/oz. but there are other analysts who believe in a gold price up to 2500 USD/Oz.

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