Southern Gold Ltd (ASX:SAU) plans to broaden exploration efforts in South Korea in 2023 to include critical minerals such as copper, lithium and rare earth elements (REE) while maintaining its primary focus on precious metals.
A comprehensive independent report commissioned by the company will be used to progress the company along the critical metals path.
The RSC Prospectivity Study by consulting group RSC identified specific areas of positive exploration potential, several close to known small-scale historical mines and occurrences.
“Significant opportunities”
Southern Gold MD and CEO Robert Smillie said: “After living in South Korea for the last 12 months and travelling extensively around the country, it is readily apparent that there are significant opportunities to broaden our gold-silver exploration portfolio to include other metals such as copper, lithium and REE.
"Several of our new projects in the east of the country already contain good copper grades, as reported recently from our Goseong and Geoje Island projects.
"South Korea has small-scale, historic lithium mines and known occurrences of REEs, however, there has been little to no modern-day exploration for these 'critical minerals'.
“The RSC Prospectivity Study commissioned by SAU has really highlighted the opportunity for the company to explore for lithium and REE deposits here in South Korea, and where to best focus our initial efforts.”
To refine priorities
Southern Gold is working with RSC to refine priorities over the winter months to refine the areas of interest identified into exploration targets through additional data verification and compilation work.
Once this work is complete, Southern Gold will commence a program of regional reconnaissance exploration in the March quarter of 2023 comprising stream-sediment sampling, rock-chip sampling, geological mapping and soil sampling, to field-validate lithium and REE mineralisation.
Detailed project-scale exploration work could commence mid-year.
The company has also initiated discussions with government research agencies to investigate joint research opportunities and with companies for potential future joint venture opportunities.
Need for critical minerals
South Korea is the world’s fifth-largest consumer of mineral resources and relies on imports for 99.6% of minerals it needs to underpin its growing high-technology manufacturing industries, including its EV, semiconductor, permanent magnets and battery industries.
These minerals include critical minerals such as lithium, REEs, cobalt, tungsten and others. Demand for these minerals is expected to increase globally 50-fold according to the International Energy Agency as the world transitions from fossil fuels to clean energy technologies to combat the impact of climate change.
Cooperation is key
To address this supply challenge, the South Korean Government has devised a national Critical Minerals Strategy to ensure security of supply of these minerals and reduce mineral dependence on China.
This strategy includes developing strategic cooperation agreements with several critical minerals-producing countries, including Australia and Canada, to provide an alternative, secure and sustainable supply of critical minerals.
In addition, Korean corporates have committed to investing more than half a billion dollars into various Australian mining projects through multiple-year offtake agreements and memoranda of understandings.
"The South Korean Government keenly wishes to develop new domestic supplies of critical minerals to diversify supplies, and the SAU team and I are in discussions with mandated government agencies with the aim of working together in the search for critical minerals in South Korea,” Smillie said.
Domestic efforts
As part of this strategy, the government, through agencies KOMIR (Korea Mine Rehabilitation and Mineral Resources Corporation) and KIGAM (Korea Institute of Geoscience and Mineral Resources), is seeking development of domestic critical minerals deposits.
This support includes subsidising re-development costs of the Sangdong Tungsten mine, owned by global tungsten miner Almonty Industries, one of the world’s largest historical tungsten mines before it closed in the 1990s due to depressed metal prices.
Other key government initiatives include national research programs led by KIGAM to promote the exploration and development of critical minerals such as lithium and REEs in regions where small-scale historical mines and known occurrences exist.
Precious metals focus
Southern Gold’s precious metals exploration program remains focused and will return to drilling starting in the March quarter of 2023, following the recent opening of South Korea post-COVID-19.
“Going forward, our epithermal gold-silver program will continue to be our primary focus as we move to drill testing a number of priority projects in 2023, and we intend to leverage our first-mover advantage and in-country capability to explore for these critical metals to create additional value for our shareholders and support government efforts,” the MD and CEO added.