Metals Australia (MLS)
Potential for significant zinc resource extensions
Speculative Buy
$0.07
MLS is focused on its Manindi zinc project that is located in the East Murchison District of WA, 20 kilometres south east of Youanmi. The project was previously known as Freddie Well and was initially discovered and explored by CRA Exploration in the late 1970s and early 1980s. The project comprises a series of volcanogenic massive sulphide zinc deposits. The geological environment shows similarities to those of other base metal sulphide deposits in the Yilgarn Craton such as the Golden Grove deposits located to the south west of Manindi, at Yalgoo, and the Teutonic Bore and Jaguar deposits in the Eastern Goldfields.
The current global resource is 1.05 million tonnes averaging 7.64% zinc and containing 80,200 tonnes of zinc. There is strong potential for significant additions to the resource tonnage through further drilling and MLS aims to commence a diamond drilling program in January 2007. This follows on from a program of 17 reverse circulation drill holes and downhole electromagnetics that was conducted in June and September 2005. Results from this program included 18 metres averaging 14.96% zinc from 43 metres downhole. These results have not been included in the current resource estimate. The program was also successful in delineating conductors surrounding and adjacent to the existing resources as well as a significant target lying in an offset position to the main lode.
The current resource is contained within a three kilometre strike length and within four prospects. These are the Kultarr prospect which has been tested to a depth of 200 metres and the Kowari, Mulgara and Warabi prospects that have only been tested to a vertical depth of 100 metres. In comparison to drilling at Golden grove and Jaguar, the drill testing of the Manindi deposits is very shallow and at an early stage of resource definition.
A soil sampling program at 100 by 25 metre spacing, with infill sampling at 50 by 25 metre spacing has extended the geochemical signatures of the Mulgara and Warabi resource areas, and defined new target areas to the south at Bandicoot and east at Quoll.
MLS is currently reviewing processing options which include crushing and grinding followed by the flotation of a concentrate, crushing followed by heap leaching and electrowinning to produce zinc metal or the sale of ore to a third party for processing.
Previous work by BioHeap Ltd has shown that zinc recoveries of 97.1% can be achieved through the heap leaching of ore using bacterial technology. The results of further testwork carried out by AMMTEC, including ion exchange testwork, were sent to both Outokumpu and Ecotec for conceptual design and costing for ion exchange systems. Data from these companies is currently being evaluated by AMMTEC, who have also forwarded data to manufacturers of commercial electrowinning plants for conceptual design and costing for an onsite electrowinning plant.
Alternatively a conventional flotation circuit producing a zinc concentrate is also under consideration. This may prove to be the chosen option as it is likely to have a shorter lead time into production.
source:
http://www.intersuisse.com.au/notes/mnfriday.html