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Perth, Jan 31, 2012 (ABN Newswire) - South Boulder Mines Limited (ASX:STB) is pleased to provide a quarterly report for the period ended 31 December 2011.

HIGHLIGHTS

A detailed engineering scoping study (ESS) for the Colluli Potash Deposit was completed generating highly favourable technical and financial results;
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Pre-production capital
(Including 15% contingency)       USD 0.74 bn
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Pre-tax NPV12%
(12% Discount rate)               USD 1.33 bn
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Internal rate of return(IRR)           40.60%
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Project revenue                   USD 6.03 bn
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MOP production rate                  1Mt p.a.
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Mining method                        Open pit
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Study mine life                      17 years
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Current resource utilisation            ~ 16%
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The results firmly confirm Colluli as a "Tier 1" global potash asset with enormous upside potential and a definitive feasibility study (DFS) is well underway for completion in 2013;

Assays and resource extension drilling continue to define shallow potash outside the existing resource including new hole Col-049 (not previously released) which intersected a total thickness 16.35m of potash from 91.22m including 9.51m of Sylvinite. An updated JORC Compliant Mineral Resource Estimate is planned for the March quarter;

Highly experienced finance and corporate executive Flavio Garofalo joins South Boulder as Chief Financial Officer to expedite The Company transition to potash producer;

An initial JORC Compliant Mineral Resource Estimate has been compiled for the Rosie Ni-Cu- PGE sulphide deposit comprising 1,744,000t @ 1.7% Ni (29,800 Ni t), 0.4% Cu and 1.9g/t Pt +Pd (>1.0% Ni cut-off). A further phase of exploration drilling at the Duketon Nickel JV is scheduled to commence in February. Mineralisation remains open along strike and at depth;

Organisation for a series of strategic investor visits to the Colluli Project throughout the March and June quarters is well advanced to assist assessing potential financial, off-take and development partners;

South Boulder is well funded to progress the Colluli DFS and is in the process of finalising a fully underwritten 1 for 5 Entitlement Issue to raise ~ A$10.7m. This will result in a strong cash position of ~A$21 million in early February 2012, an additional A$2.5 million in equities with a further A$4.2 million expected from option conversions.

To view the complete South Boulder Mines Quarterly Report, please refer to the following link below:
http://media.abnnewswire.net/media/en/docs/ASX-STB-575879.pdf

About South Boulder Mines Limited

CMSC owns exploration tenements spanning over 400km2 within the Danakil Depression in South East Eritrea.

Since 2010, 97 holes have been drilled identifying a resource containing more than one billion tonnes of potassium bearing salts suitable for the production of potash fertilisers.

South Boulder Mines Ltd is currently working on the Feasibility Study to support the development of the project.


Contact

Lorry Hughes
CEO/Managing Director

Kerry Rudd
Executive Assistant

Liam Cornelius
Executive Director

Flavio Garofalo
CFO

Dr. Chris Gilchrist
Non-Exec Director

South Boulder Mines Limited
T: +61-8-6315-1444
F: +61-8-9486-7093
http://www.southbouldermines.com.au



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