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The Western-Australian based lead-silver-zinc explorer, Pacifico Minerals Limited (ASX:PMY) appears to be advancing well on its Sorby Hills Project, which is highly prospective for base metal deposits. The latest appointment of Mr Gary Comb as the executive chairman comes as a strategic direction concerning the company’s goal centred at its transformation from the exploration to the development company.
The Sorby Hills Project in this respect appears to boost prospects of Pacifico Minerals through its exploration upside and reliable drilling results supported by the robust financials.
A Glimpse At The Sorby Hills Project
Sorby Hills, located around 50 kilometres north-east from Kununurra, is a large, flat-lying near-surface deposit of lead, silver and zinc. The project jointly owned by Pacifico Minerals (75%) and Henan Yuguang Gold & Lead Co. Ltd (25%) enjoys significant infrastructural advantage facilitating the fast-tracked production. The key government approvals such as mining and pre-native title tenements and West Australia EPA have been secured in relation to the project.
Key developments undertaken at the project post the acquisition include:
- Phase I 5500 metres drilling
- Phase II 6000 metres drilling
- Phase III 3,000m Drilling Program
- PFS Review and Update
- Significant uptick in Mineral Resource Estimate
Embellished Path To High-Quality Concentrate
Open-pit mining along with the high recoveries and the simple processing techniques favour the production of the high-quality concentrate at the Sorby Hills Project.
Mining
A flat topography facilitates access to ore, and low-cost pre strip and the deposits at the project are mineable with 5 metres benches.
The initial production involves the production from three open pits. To reduce rehabilitation, waste rocks would be returned to exhausted pits.
Metallurgy
- Up to 97% Pb and 91% Au recovery on fresh composites are confirmed through the Rougher flotation with sulphidisation testwork.
- Flotation testwork suggests the production of cleaner concentrate grade of 65% Pb, with soft ore, coarse grind and low milling costs.
- Presence of simple lead sulphide mineralogy allowing low-cost beneficiation prior to grind and floatation
Strong Mineralisation Backed By Robust Pre-Feasibility Financials
The project, from 20 metres below the surface and open along strike and down dip, has the Global Resource of 36 Mt @ 4.9% Pb equivalent and 0.5% Zn. With each drilling program, the substantial increase in the resource size suggests positive insights for the company. A continuity across several minor deposits constituting the Omega deposit with a strike length of 1.7km has been confirmed via the drilling programs.
What Market Has In Store For The Project?
According to the company, Lead batteries account for 75% of the global rechargeable energy storage (Source: ILSZG May 2019 Presentation ‘Importance of Zinc to the Circular Economy).
Pacifico minerals indicate that while the demand for the lead is predicted to show the growth at CAGR of 6.74% between 2018 to 2022 (Source: Business Wire), deficits would begin from 2023 without the supply of new mine.
At the time when 50% of the new vehicles are forecasted to have Start-Stop technology by 2020 consuming 25% more lead (Source: The Assay Group Mining Magazine), the records low stock of short-term refined lead highlights an alarming situation.
Upcoming Activities
The company plans on conducting the definitive feasibility study in Q1 2021.
Q2 2020
- Optimised pre-feasibility study and ore reserve estimate
- Offtake Update and strategic financing
- Phase IV expansion and Infill drilling
Stock Performance
Notably, PMY stock closed at $0.004 at the end of the trading session on 12 March 2020. The company, with the outstanding shares of ~2.89 billion, has the market capitalisation of $14.44 million.
