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Corazon Mining Ltd (ASX:CZN), is a base metals explorer advancing on the two mineral projects, Lynn Lake Ni Cu Co and Mount Gilmore Cu-Co Au. CZN aims to strengthen strategic metals supply in first-world nations spread across two different geographies.
CZN owns Lynn lake project in Manitoba, Canada which is an advanced mining centre and hosts large mineral resources. The scale of the Lynn Lake project with the strong anticipated demand for Nickel provided a strong case in favour of prioritising the Lynn Lake project.
Must Read: A Glance Through Corazon’s Two Ace Projects: Lynn Lake and Mt Gilmore
The Lynn Lake mining centre last operated around 45 years ago and CZN has become the first company since then to combine the whole region upon the acquisition and reunification of Victory mines in 2015, which is adjacent to the Lynn Lake project in the Canada’s third-largest Nickel producing region. The historic mining centre and the other exploration prospects around it is now held by CZN.
Lynn Lake Project Timeline
CZN acquired the Lynn Lake project back in 2010 and conducted the exploration programs on the mineral ground. During this phase, the Company discovered highly prospective mineralisation at the El Deeps. Post reunification with the victory mining prospect encourages the mineral resources potential for the Company.
Lynn Lake Mineral Resources Estimate Source: Corazon Mining
As per the World Bank & our own assumptions and estimates, the average prices for the commodities in February 2020 & the reported Mineral Resources for Lynn Lake-
Source: Kalkine Research & World Bank
*Cobalt price has been assumed around the current LME prices range of ~US$31,000/t
As per the estimation, the economic value of the mineral resources, although not all would be extractable, carries a value of almost ~US$1.9 Billion with the further possibility of reserves and resource expansion. We do realise that not all the resources could be economically extracted, but the above calculation is just to indicate the possible economic value generation by the mining project.
Lynn Lake Exploration Program
CZN completed the 1,122 metres diamond drilling program by the end of the year 2019. The drilling program’s assay results from all the 7 holes were released and focussed on the shallow mineralisation which allows the future mining at lower operating costs. The lower mining and reduced waste handling costs would help optimise the margin, thereby improving the project’s resilience to the Nickel price fluctuations.
The shallow mineralisation within the historically mined regions of the project, reflected excellent results.
Read Here: Corazon Announces Outstanding Maiden Assay Results from Lynn Lake
Another major prospect is Fraser Lake, which is in the vicinity (~5 kilometres) to the major historic mining centres of Lynn Lake complex. CZN would like to pursue this prospect in the times to come. For now, the Company intends to focus on accelerating and commencing the operations at the shallow mineralisation zones within or around the historic mining sites. The strategy of CZN ensures that the Company brings in the revenue and then reinvest to further expand the mineral reserves and resources.
Mining and Mineral Processing Studies
CZN anticipates a low cost, long-life mining operation at the Lynn Lake Nickel site. The mining studies focussed on optimising the mining costs for the proposed underground operation using innovative mining techniques.
Metallurgical test work resulted in high-quality separate Nickel/Cobalt and Copper concentrates with the following product specifications-
- Nickel concentrate – 26% Ni concentrate grade at 71% metallurgical recovery
- Copper concentrate – 27% Cu concentrate grade at 77% metallurgical recovery
Further test work aims to increase the metallurgical recovery to around 80%. The historic operations produced single mixed product which required further refining to separate each of the payable commodities.
The Lynn Lake Nickel Copper Cobalt project presents a lucrative opportunity for the Company on development, with the upsurge expected in the demand for battery and electrification metals.
The Lynn Lake project in the Tier 1 mining jurisdiction is involved in the right commodities at the right time in the right location-
- Near Surface Resource expansion may lead to accelerate the commencement with low capital requirements
- Tight Nickel market conditions anticipated from 2021
- Separate & high-quality Nickel & Copper products
- Multicommodity nature of the mineralisation reduces the cash cost (net of by-product credits), thus increasing the margins
Lynn Lake presents a strong case in supplying the high value commodities of the future. CZN has accelerated the mining project over Mt Gilmore and anticipates generating high-value from the Nickel Sulphide project.
