Xstrata Resources (LON:XTA) and Minco (LON:MIO) have reported an upgraded resource estimate for the Pallas Green zinc project in the Republic of Ireland. Through its work on the joint venture property, Xstrata has now increased the inferred resource to 24.1 million tonnes at average grades of 7.85% zinc and 1.35% lead.
The major mining group has indicated a potential 2017 start-up for a 160,000tpa zinc mine, with an indicative capital cost of US$300 million.
Pallas Green lies in a prospective region in the southwest of Ireland, near the border between county Limerick and Tipperary, where a number of commentators believe a new world-class zinc mine may soon be established. Pallas Green is a 23.6%/76.4% joint venture between Xstrata Zinc and Minco.
A recent research note by Optiva Securities, stated that Stonepark may actually be a continuation of the Pallas Green deposit. "From what is known so far it would seem that both Stonepark and Pallas Green could form part of the same ore-body and be of world class resource status," the broker said in a note to clients.
According to Optiva, this throws open a number of interesting ‘corporate options’ to monetise the projects.
Similarly a note by Beaufort International, published in June, highlighted the significant potential of Ireland’s Midland orefield which it describes as an “unparalleled opportunity,” According to Beaufort, the region boasts the largest number of zinc discoveries per square kilometre worldwide.
“Given that Ireland’s south western deposits tend to occur as a ‘string of pearls’ separated by perhaps 2 to 5km and that the larger part of both prospects remain unexplored, it is just possible that the two companies are working on the same giant mineralised system,” Beaufort stated.