Pacifico Minerals Limited (ASX:PMY), a base metal exploration and development company, is seeking to develop an exciting near surface Lead-Silver-Zinc project in Western Australia, relatively unaffected by COVID-19 uncertainty.
Pacifico is tapping lucrative opportunities offered by Lead batteries supporting clean energy transition, in partnership with China’s largest lead smelting and silver producer - Henan Yuguang.
While PFS indicates robust financials and compelling economics of the project, recent Mineral Resource upgrade is expected to support Optimised PFS in second quarter. Besides, open pit mining, simple processing and high recoveries are expected to produce high quality concentrate.
Managing Director and CEO of the company, Mr Simon Noon shared the company’s future strategy and growth prospects recently in an interview with Kalkine Media.
- To begin with, what’s your take on the latest MRE indicating considerable uptick in contained Lead and Silver in M&I category over previous MRE?
Based on our detailed reviews, additional drilling programs, and the understanding of the mineral system, it became clear to us that an upwards revision was an imminent and inevitable step in the progression of the Project. The Project data density, together with a reassessment of the historic data, showed that we had reached a level of confidence where the risk profile had been significantly reduced and we could demonstrate that to our resource consultants for their evaluation.
Burying ourselves deeper into the data since we acquired the Project, in particular this year, we have, to some extent, rediscovered past knowledge and in doing so we were able to merge it with new information.
The latest resource revision estimate fills us with a lot of confidence about the Project and its future.
- What part of the business do you think has the most exploration upside potential?
We have a pipeline of prospects that we will work on going forward.
We have by no means reached the limit of our learning about the geology and prospectivity of the Project. We hold the view that the complexity of the system harbors the greatest future potential. We have already demonstrated that the mineralisation is widespread across an area of more than 15km2 and growing.
However, as is the case in many MVT (Mississippi Valley-type) districts around the world, they occur as clusters of ‘economic’ mineralisation hosted in pods that range from a few hundred thousand tonnes to several million tonnes. We have delineated several big ones and we believe the immediate impact will come from the tightening of the drill hole spacing within the area of known mineralisation.
One example is our recent success following up a wildcat target. Our review of historic data shows that there are a number of such targets yet to be tested.
Beyond the ‘brown-field’ areas, we are looking forward commencing exploration on the newly acquired E80/5317. We see this as a significant opportunity. We know that the east and west margins of the Burt Range Sub-basin host mineralisation and the expectation that the southern end is prospective is natural.
- While Pacifico is riding high on the back of significant MRE update, how is the company coping with COVID-induced challenges?
For us business was uninterrupted. It gave us the opportunity to use the time to review all inherited data and look for missed opportunities
- While the inclusion of updated resource is anticipated to delay the Optimised PFS completion (now expected in July 2020), what seems to be key highlights of the upcoming Study results?
Essentially the Optimised PFS is expected to deliver a significantly lower risk project with 50% increase in mining and processing which has been underpinned by drilling success and the extensive work we’ve already discussed.
- Given the industry dynamics and COVID-induced uncertainty, is there any expected impact on the upcoming news flow pertaining to strategic financing and offtake update, Phase IV expansion drilling and DFS?
Sorby is in arguably the best jurisdiction for a development project right now with Western Australia relatively unaffected by COVIID-19.
Our JV partner, Henan Yuguang, is China’s largest lead smelting and silver producer and has recently confirmed they are back to full production. We have full access to our Project with restrictions now lifted in the Kimberley. So while there is still a lot of uncertainty in the global markets, I think we are in an enviable position going forward and expect to progress the Project.
- What do you believe provides competitive edge to Pacifico Minerals in the market over other names in the space?
We have an ore body starting at just 20m from surface, a very significant silver credit, existing roads from the Project to the port (just 140km away and already shipping metal concentrates). We are in Western Australia just 50km from a major town and to top it off, the Project has Environmental Protection Authority (EPA) approval for an open pit mine and associated infrastructure. I believe these factors make our Sorby Hills Project very attractive particularly in a post-COVID environment.
We’ve created a fantastic opportunity for Pacifico to become a significant long-life lead and silver producer in Western Australia in the not too distant future. Its truly an exciting time for the Company and its shareholders.
- Any triggers you envision that can boost the stock performance. And what is your view on shareholders’ return in the next 2-3 years?
I expect the upcoming PFS to capture the attention of institutional investors which has the potential to significantly boost the Companys’ share price. This, along with the confirmed ore reserve, is a big milestone for the Project.
The Project is getting bigger and better every time we drill at Sorby Hills and we hope to be drilling again over the next few months. We anticipate that our next phase of drilling will add new resources, but a real boost can come from a new discovery.
- Would you like to touch upon the company’s overall vision and how it sets within the entire battery landscape?
Lead batteries are a key element in the transition to a low carbon economy and have unrivalled sustainability credentials so the outlook for lead is strong.
Lead batteries provide 75% of worldwide rechargeable energy storage.
Many people are not aware that all electric vehicles use a separate lead battery to run their safety systems.