The re-start of a mothballed zinc mine in Australia is turning out to have a strong upside for both the mining company and its investors.
New Century Resources (ASX:NCZ) announced the completion of resource definition drilling at the South Block portion of the Century Zine Mine.
The mine was the third largest zinc mine in the world prior to its closure in 2016. New Century acquired its interest in 2017 and on November 28 completed a feasibility study into a restart of the mine and recommissioning of the existing processing plant. The company raised $52.9 million in the fall for the re-start, through a private placement.
In a news release Monday, NCZ said it drilled two diamond holes through the central part of the South Block deposit, to get representative samples to check historical drilling data. The samples were used to validate the Indicated Mineral Resource estimate, and provide samples for metallurgical test work and recoveries.
Highlights of the results:
The company said it will now initiate an Expansion Feasibility Study to assess the incorporation of these insitu resources into upcoming operations of the Century Zinc Mine. It says the study has the potential to increase the previously announced (tailings only) 6.3 year mine life at 264,000 tonnes per annum full scale zinc metal production. The study will begin in the second quarter and is expected to be finished by year-end. Mining of the tailings at New Century Mine is on track to start in the third quarter.
In October New Century, then a 70% owner of the open-pit mine, took over the remaining 30% through the purchase of privately-owned Century Bull. The mine is 25 kilometres northwest of Mount Isa in the Lower Gulf of Carpentaria.
During its 16 years of operations, starting in 1999, Century processed an average 475,000 tonnes per annum zinc concentrate and 50,000 tpa lead concentrate. The product was transferred in slurry form via a 304-km underground pipeline to Century’s port facility at Karumba for shipping to smelters in Australia, Europe and Asia. In 2016 the mine closed due to depleted reserves.