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Zinc One pushing ahead with high potential Peru project

Published: 10:00 03 Jan 2020 EST

Snapshot

The Bongará mine was first discovered in 1974 and various companies have completed exploration programs in the area

Zinc bars
  • Based in mining-friendly Peru

  • A planned path to development

  • Production targeted for 2021; an open pit operation with permitting on-track

What Zinc One Resources does:

Zinc One Resources Inc (CVE:Z) (OTCMKTS:ZZZOF) is, as the name suggests, a zinc explorer and its key assets are the past-producing Bongará Zinc mine project and Charlotte-Bongará Zinc project in Peru.

The company got its hands on the asset when it bought Forrester Metals in 2018 in a one-for-5.5 all-share acquisition.

The Bongará mine was discovered in 1974 and various companies have completed exploration programs across the area. Zinc One has access to most of the data and technical work that date back to the 1990s and was included in the technical report issued in 2016.

The Bongara zinc mine and associated Charlotte Bongara zinc project are home to zinc oxide mineralization occurring over a 2.5 kilometre (km) trend, and much of the area has been subject to sampling from pits and trenches, as well as by shallow drilling.

Bongara was previously a mine in production between 2007 and 2008, exploiting high grades at the surface - 150,000 tonnes mined at over 20% - but was shut down due to the zinc price decline and global financial meltdown. Previous exploration resulted in a resource of up to 1.2 mln tonnes of oxides grading around 21% zinc, although this number was not compliant with modern NI-43-101 legislation.

In February last year, Zinc One reached a major milestone for Bongara, publishing a positive first NI 43 -101 resource estimate, with the higher confidence indicated resource pegged at 812,000 tonnes averaging 18.9% zinc, containing 339 million pounds of the metal.

The inferred resource showed 1.34 million tonnes averaging 16.8% zinc, containing 496 million pounds of the commodity.

Significantly, the company said this resource estimate still only covered a small area along a strike of 8km  of prospective geology.

How is it doing:

In April 2019, Zinc One named director Gunther Roehlig as its interim CEO, replacing outgoing interim chief executive officer and director Dr Bill Williams.

The group also revealed that it had hired Dr. Chris Wilson, to render consulting services. Notably, the firm said, he was to carry out a detailed review of various options to further develop the Bongara Zinc mine project and assist in identifying potential sources of financing to facilitate such development.

In September, the firm updated on its exploration programs, saying reconnaissance mapping was carried out on the zinc sulphide mineralization at Cristal, which lies on the Charlotte-Bongará Zinc project, around 6km to the northwest of the main deposit at the Bongará mine.

The mapping confirmed the presence of a zinc sulphide mineralized sub-crop and boulder float in the Cristal area. The firm said it was remodeling the data to plan an infill drilling campaign.

The company also said that it was exploring alternative uses for zinc-oxide material from the deposit that would ideally minimize operation costs on the project.

Notably, in May 2019, Zinc One reported it had gained a significant new funding partner to advance the project in the shape of InCoR Holdings, a venture capital investor in the natural resources industry, with which it formed a  joint venture. InCoR was to provide up to US$3.75 million in funding in exchange for earning up to an 80% interest in the venture.

Zinc One said that InCoR will provide significant metallurgical expertise, technical assessment and project development insight to advance Bongará. It said it would also issue a rights offering to existing shareholders.

On August 12, Zinc One closed the rights offering that saw a total of 69,846,582 common shares issued to holders at a subscription price of $0.02 per share which raised gross proceeds of $1,396,932.

The group said the net proceeds would be used to repay corporate indebtedness, reduce trade payables, incurring US$200,000 for geological, resource modelling and technical studies on the Bongará project and general working capital.

However, on September 16, Zinc One said it had terminated the term sheet from May with InCoR Holdings, saying the pair were unable to settle the terms of the definitive agreement by the August 31 close.

Inflection points:

  • More exploration results
  • Financing news

What the boss says:

In May last year, Zinc One's interim chief executive Gunther Roehlig explained to Proactive the rationale behind the  InCoR deal and outlined the challenges the firm has been facing.

On the Peru project itself, he added: "We are one of the only, if not the only, high grade, zinc oxide deposits in the western world that's on surface, so the actual mining costs are not going to be comparable to traditional underground mining."

Zinc One Resources agrees to term with InCoR Holdings regarding Bongara Project

Zinc One Resources (CVE:Z) Interim CEO Gunther Roehlig dropped in the Vancouver studio of Proactive Investors to talk about the strategic relationship Zinc One has signed with InCoR Holdings. He talked about the structure of the deal and what it means going forward. Roehlig also addressed...

on 05/29/2019