Rathdowney Resources (CVE:RTH) has identified significant new zinc, lead and/or silver mineralization in 11 out of 16 holes during its extension to Zone 5 from the limits of the resource estimate announced earlier this year at the Olza Zinc-Lead project in southwestern Poland.
The new results are from holes OLZ-226 to OLZ-241, and are part of a program designed to collect geotechnical data in areas of potential infrastructure development and to further test the Olza deposit, said the company in a statement.
The new drilling focused on the area outside the currently defined mineral resource area, focusing on the potential underground infrastructure near Zone 5. This is one of several zones that comprise the mineral resource at Olza.
The highlights of the assays were 3.3 m of 16.0% Zn+Pb including 1.3 m at 36.9% Zn+Pb in Hole OLZ-241, 8.5 m of 4.77% Zn+Pb and 12.8 g/t Ag including 2.1 m at 17.9% Zn+Pb and 36.8 g/t Ag in Hole OLZ-232 and 3.9 m of 4.7% Zn+Pb and 20 g/t Ag in Hole OLZ-229.
The results suggest that the Project has an excellent potential to further increase mineral resources with additional drilling.
"Rathdowney's drilling continues to demonstrate the exceptional potential of Project Olza and to add value to the project. These new drill holes have obtained valuable data for our ongoing engineering studies and also indicate extensions to the mineralization, confirming the potential to expand the mineral resources and extend the mine life from that presented in the PEA," said Rathdowney's president & CEO, Robert Konski.
The Olza project covers three exploration concessions --- Zawiercie, Rokitno and Chechlo --- and is spread over an area of 150 square km and is just one hour away by vehicle from Krakow. This is an area known for its Mississippi Valley-type zinc lead deposits, which have been mined here continuously since the 12th century, producing some 16 million tonnes of zinc and 4 million tonnes of lead.
Earlier this year, Rathdowney announced new milestones for Project Olza, including increased inferred mineral resources of 24.4 million tonnes grading 7.02% Zn+Pb (at a 2% Zn cut-off) and a preliminary economic assessment (PEA).
With an initial capital of US$227 million, Olza features operating production costs of US$69.88/tonne milled, a Net Present Value (NPV) of US$170 million and a 30 percent internal rate of return (IRR) according to the preliminary economic assessment.
Such robust economics suggest Rathdowney is making progress toward becoming a recognized player in the junior zinc sector. The PEA suggests the project will pay for itself in 2.4 years, recommending the development of a conventional underground mine using room and pillar mining methods and a mineral processing rate of 6,000 tonnes per day or 2.16 million tonnes per year.