Ironbark Zinc (ASX: IBG) has increased the grade and tonnes of mineralisation at the Citronen Base Metal Project in Greenland, after last week’s resource upgrade.
The company has announced a 23% grade increase in grade for the underground optimised mineral inventory, to 39.1 million tonnes at 6.18% zinc, for 2.4 million tonnes of contained zinc metal, and 0.53% lead.
This comes hot on the heels of a 53% increase in Measured and Indicated Resources at Citronen, announced on January 9.
The global resource at Citronen now stands at 13.1 billion pounds of zinc and lead, using a 2% zinc cut-off, compared to the previously reported estimate of 132.6 million tonnes at 4% zinc and lead for 11 billion pounds.
Ironbark managing director Jonathan Downes told Proactive Investors today that the combined resource upgrade and grade increase would have a positive impact on the Feasibility Study that is underway with China Nonferrous.
“When you increase the grades in the material you’re planning to feed a process plant, you go straight to the bottom line, and that’s very positive for the company and the ongoing Feasibility Study,” Downes said.
“What’s very positive as well about the mining study is that it puts the value of the grade increase from the resource into a context that has a direct production benefit to the eventual mine.
“All this will feed into a final result that I think will be a much better result than if we hadn’t had the resource upgrade.”
Citronen is one of the world’s largest zinc projects by size, and one of only a handful of world class base metal projects to be wholly owned by a junior resource company.
The new Citronen resource model has been evaluated using Minable Shape Optimiser evaluations, to maximise the value of the resource based on stope geometry and design rules.
A cut-off grade of 4.5% zinc has been selected, resulting in an increase in projected feed grade after dense media separation to 10.1% zinc and lead, with 9.3% zinc and 0.8% lead.
This includes 35% rejection and 15% fines bypass to direct feed.
Mineralisation at Citronen is open in almost every direction, with potential to substantially increase the project’s mine life.
The Feasibility Study, which is nearing completion, is based on a 3 million tonne per annum mining operation to produce between 175,000 and 275,000 tonnes per annum of 55% zinc concentrate and 10,000-26,000 tonnes per annum of 50% lead concentrate over a mine life of at least 13 years.
Taking Inferred mineralisation into account, mine life could increase to 16 years, with potential for a much longer mine life.
Early figures released in October 2011 indicate capital expenditure and operating expenditure could be lower than other major global mines.
Detailed mine scheduling work in progressing at Citronen, with high grade areas to be targeted for early production where possible.
Downe told Proactive Investors that Ironbark and China Nonferrous were eyeing production at Citronen in 2014.
“The date that we’re running with with China Nonferrous is that construction is to commence late 2012, so late this year following the Feasibility Study results, and then hopefully we’re in production in 2014.”