Pacifico drilling results to feed into PFS
Pacifico Minerals Ltd ASX:PMY) has commenced a major drilling campaign at its Sorby Hills Lead-Silver-Zinc Project near Kununurra, Western Australia.
As part of a 12,000 metre drilling program, the initial 6000 metre infill and expansion drilling will focus on the high-grade and shallow portions of the current 16.5 million tonne lead-silver-zinc resource stop
As a backdrop, the company completed the acquisition of a 75% interest in the Sorby Hills Project only a fortnight ago and management has moved quickly to mobilise a drill rig to the area.
Immediate commencement of drilling augurs well for investors who see significant future value being realised given the strong grades and extensive mineralisation already recorded.
Pacifico is looking to extend the existing mineral resource estimate of 16.5 million tonnes at 4.7% lead, 0.7% zinc and 54 g/t silver.
The existing resource extends over two of the five granted mining leases, and the majority of the resource lies within one mining lease, ML80/197 which was granted in 1988.
Pacifico has concluded that drilling within the existing Inferred Mineral Resource or zones immediately adjacent provide the best option to incorporate an updated resource estimate from this drilling into a prefeasibility study (PFS) to be completed in 2019.
Valuable support from global smelting giant
Pacifico’s joint venture partner in the Sorby Hills Project is Henan Yuguang Gold and Lead Co Ltd (Henan Yuguang), who has maintained a 25% interest in the project since acquiring its interest on September 2010.
Henan Yuguang is the largest lead smelting company in China with headquarters in Jiyuan in Henan Province, China.
Henan Yuguang general manager, Mr Li, reaffirmed his support for the project in saying, “We are delighted that Pacifico Minerals has completed the acquisition of a 75% interest of the Sorby Hills project.
“Yuguang is committed to the Sorby Hills Project and will actively support future plans with its resources with a view to moving the project into production as soon as possible.”
Working towards PFS
Pacifico will now work with Henan Yuguang to update previous technical studies to increase the confidence in the resource estimate and undertake metallurgical testing to optimise the design of the processing plant in order to produce a simple and clean concentrate.
This will ensure that the end product complies with all regulatory requirements to complete a PFS which envisages mining, processing and exporting base metal concentrate from the Port of Wyndham, a road distance of approximately 140 kilometres from the Sorby Hills.
Summing up near-term developments, Pacifico managing director Simon Noon said, “This drill program represents a significant investment by Pacifico and Henan Yuguang in building the tonnage and gaining an understanding of the resources at Sorby Hills.
“The planned drilling is focused on expanding the mineral resource in a manner that is expected to immediately add to the project’s Indicated Resources and assist in preparing for Phase 2 of the drilling campaign to move a portion of the resource to an Ore Reserve, enabling planning for a future mining operation.”
Beyond the initial high-priority infill drilling, Pacifico has highlighted exploration potential outside of the existing estimated resource, where a number of orebodies remain open along strike and warrant follow up drilling.
Expanding the resource would add further value to the project as it would provide scale to increase production off a relatively fixed cost base.
Over the years, the project has seen the development of the Kimberley region with a number of operating mines in the East Kimberley producing diamonds, iron ore, nickel, lead and zinc and more recently the development of a rare-earth mine.
The expansion of the Ord Irrigation Scheme has required significant involvement from government authorities and this has assisted the project in receiving a comprehensive environmental review by the West Australian Environmental Protection Authority.
The area is also well served in terms of export infrastructure with access to the port of Wyndham.
However, Noon, sees the scope for further development saying, “Pacifico believes that it can incorporate improvements in infrastructure, including a sealed highway from the mining lease to the port already in place, better handling of base metal concentrate using sealed containers, and a desire from customers seeking a clean lead-silver concentrate free from deleterious elements to offset the closure of a number of lead mines in China.”