Bluebird said the test work confirmed results obtained from the underground exploration programme, with the average grade of the sample almost 5g/t gold and 19g/t silver.

The ore was run through a simple gravity circuit, which yielded recoveries of up to 80% gold and around 60% silver.

It said the results indicated the ore was not problematic and would not require complicated or expensive extraction techniques, which would allow the company to consider low cost options for the design and construction of its process plant.

Bluebird is continuing test work focussing on a leaching process and after this will compare operating and capital costs and overall economics.

CEO Colin Patterson said the metallurgical test work was critical to ensuring the feasibility of the mining operation.

"The initial test work has demonstrated higher than the industry standard in terms of recovered gold for this simple and inexpensive gravity process. This will certainly improve the economics of production following the reopening of the Kochang mine," he said.

He added that the economics of reopening an old mine were far less costly than a new development.

The company is busy earning into 50/50 joint ventures with Southern Gold at both the Gubong and Kochang brownfield gold mines and recently ticked off the final expenditure required for the Kochang JV .

The test work results had no impact on Bluebird's shares Wednesday, which slipped 2.56% to 1.9p (US2.42c).