Base Metals Snapshot: Eight companies advancing projects around the globe

As the global demand for base metals grows, mining companies are on  the hunt for new deposits that they can develop into operating mines. Here are eight companies with significant projects in the space.

GROUP ELEVEN RESOURCES

Formed in 2015, Group Eleven Resources (TSXV: ZNG; US-OTC: GRLVF) focuses on zinc deposits in Ireland, and its two key projects are Ballinalack, a joint venture with Nonfemet, one of China’s largest zinc producers, and Stonepark, a joint venture with Arkle Resources. Ballinalack is in northeastern Ireland and hosts potential Navan Bed mineralization in the Pale Beds, and Stonepark is near Limerick and next to Glencore’s Pallas Green deposit, one of the world’s largest undeveloped zinc deposits.

Ballinalack, 50 km west of Boliden’s Navan (Tara) zinc mine, has an inferred mineral resource of 5.4 million tonnes grading 8.7% zinc, plus lead. Historic intercepts include: 10 metres grading 17.9% zinc, 4.2% lead and 10.1 grams silver per tonne; 46 metres grading 13.6% zinc, 2.4% lead and 21.3 grams silver; and 24 metres grading 16.6% zinc, 3.2% lead and 16.3 grams silver. Group Eleven owns 60% of the joint venture.

Stonepark contains inferred resources of 5.1 million tonnes grading 8.7% zinc and 2.6% lead, and Group Eleven Resources’ ownership of the joint venture is 76%. In addition to Ballinalack and Stonepark, Group Eleven also wholly owns the Silvermines project, located next to the historic Silvermines zinc mine, which produced 10.8 million tonnes grading 7.4% zinc and 2.7% lead between 1968 and 1982. As of June 4, MAG Silver owns 16% of the company, while Teck Resources owns 6%. Institutional investors hold 10% and insiders, 17%.

HUDBAY MINERALS

Hudbay Minerals (TSX: HBM; NYSE: HBM) has built a diversified portfolio of operating mines in North and South America, primarily producing copper concentrate (containing copper, gold and silver), molybdenum concentrate and zinc metal. The company owns three polymetallic mines, four ore concentrators, and zinc production facilities in Canada and Peru, and has copper projects in Arizona and Nevada in the United States.

The company’s exploration portfolio consists of 8,550 sq. km across Canada, Peru, the U.S. and Chile, and management has earmarked a 2019 exploration budget of $40 million, which includes option payments. The funds will focus on exploration near processing infrastructure in Manitoba and Peru, as well as in Nevada, Chile and British Columbia.

During the first quarter, Hudbay’s Constancia mine in Peru produced 31,843 tonnes copper, 14,427 oz. precious metals and 304 tonnes molybdenum. The company’s Manitoba operations produced 28,037 tonnes zinc, 6,129 tonnes copper and 24,266 equivalent oz. gold precious metals. In Arizona, the company concluded the permitting process at its Rosemont copper project in March 2018 with the receipt of the Section 404 water permit from the U.S. Army Corps of Engineers, and the mine plan of operations from the U.S. Forest Service. Once in production, Hudbay estimates Rosemont will be the third-largest copper mine in the United States. Hudbay recently announced it had extended the mine life at its 777 mine in Manitoba to the second quarter of 2022, from the end of 2021.

KINCORA COPPER

Kincora Copper (TSXV: KCC) is focused on its two wholly owned copper projects in Mongolia’s Southern Gobi–Bronze Fox and East Tsagaan Suvarga. The junior, based in Ulaanbaatar, with a corporate office in Vancouver, has operated in Mongolia since 2010.

In June, Kincora Copper kicked off a drill program at its Bronze Fox copper-gold porphyry project, with funds from a recent $6.3-million capital raise. The drill program will focus on two new targets outlined with the help of an independent block model, the re-logging of 24,000 metres of drill core, new geophysics and a reinterpretation of previous results. The company plans to drill up to 8,100 metres at Black Fox in 2019. Three of four holes previously drilled by Kincora into the monzodiorite section of the intrusive complex intersected over 1% copper, and have only tested 260 metres of over a kilometre strike length.

The Black Fox project has a mineralized footprint of over 40 sq. km within the Bronze Fox Intrusive Complex, and was one of four projects that Ivanhoe excluded from its BHP joint venture between 2006 and 2009. Kincora consolidated the ownership of Black Fox in early 2012.

The company’s 2019 drill program will also include up to 6,200 metres of drilling at its brownfield East Tsagaan Suvarga project.

NORONT RESOURCES

A drill site at Noront Resources’ AT5 target at the company’s Eagle’s Nest nickel-copper-PGM project in northern Ontario’s Ring of Fire region. Credit: Noront Resources.

Noront Resources (TSXV: NOT) has the largest land position in the Ring of Fire, an emerging multi-metals area in the James Bay Lowlands, 500 km northeast of Thunder Bay in northern Ontario. The “Ring” is 100 km in diameter and the result of a belt of mafic and ultramafic rocks wrapping around a circular intrusion. Noront’s flagship project, Eagle Nest, is a high-grade, nickel-copper-platinum group element (PGE) deposit. Noront describes Eagle Nest as the largest high-grade nickel discovery in Canada since Voisey’s Bay, and the most advanced project in the Ring of Fire.

The company expects Eagle’s Nest will produce 3,000 tonnes of mineralized material a day, which will be mined by underground methods and processed to deliver 150,000 tonnes of nickel-bearing concentrate per year over an 11-year mine life. Proven and probable reserves at Eagle’s Nest measure 11.13 million tonnes grading 1.68% nickel, 0.87% copper, 0.89 gram platinum per tonne and 3.09 grams palladium per tonne.

The junior also owns the Blackbird and Black Thor chromite deposits in Sault Ste. Marie. Noront expects Blackbird will be its second mine and is one of a number of large-tonnage chromite discoveries in the Ring of Fire. Blackbird has measured and indicated resources of 20.46 million tonnes grading 35.76% chromium trioxide and inferred resources of 23.48 million tonnes averaging 33.14% chromium trioxide. The Black Thor deposit has 137.7 measured and indicated tonnes grading 31.50% chromium trioxide and 26.8 million inferred tonnes grading 29.30% chromium trioxide.

NORTHERN SHIELD RESOURCES

Northern Shield Resources (TSXV: NRN) focuses on nickel, copper, platinum group elements and gold. The junior is earning an 80% interest in the Shot Rock gold property in Nova Scotia, where it explores for epithermal gold mineralization. Last year Northern Shield confirmed the discovery of a low-sulphidation epithermal system at Shot Rock, which it says is the first time this style of gold mineralization has been found in the province. Gold mineralization of up to 3.3 grams gold per tonne was found within quartz veining. In June, the company reported that assays from rock sampling of the second low-sulphidation system discovered within the Highway Zone at Shot Rock demonstrated a 300-metre long, gold-anomalous trend, including assays of 5.3 grams gold per tonne and 4.9 grams gold per tonne.

In May, Northern Shield signed an option agreement to acquire 100% of the Root and Cellar gold project in Newfoundland, where it plans to explore for low and intermediate sulphidation epithermal-type gold mineralization, as well as copper porphyry mineralization. Grab samples from the property include grades of 45.5 grams gold per tonne and 1,365 grams silver per tonne; 37.8 grams gold and 1,000 grams silver; and 25.8 grams gold and 487 grams silver.

The company also has two gold properties in Gaspésie, Que. (Grand Pabos and Estcourt), the Five Islands and Parrsboro gold properties in Nova Scotia, and two nickel-copper-PGE projects in Quebec’s Labrador Trough.

OSISKO METALS

Osisko Metals (TSXV: OM; US-OTC: OMZNF) is focused on zinc assets in Canada. Its flagship asset, the Pine Point lead-zinc project on the south shore of Great Slave Lake in the Northwest Territories, was first discovered in 1898 by prospectors heading to the Klondike gold rush. Osisko acquired the project in February 2018, and has reported an inferred resource of 38.4 million tonnes grading 4.58% zinc and 1.85% lead for 6.58% zinc-equivalent. Highlights from drill intersections reported earlier this year include 10.23% zinc and 9.19% lead over 13 metres; 9.60% zinc and 1.53% lead over 14 metres; 14.66% zinc and 3.84% lead over 10 metres; and 8.59% zinc and 2.38% lead over 3 metres.

Within northern New Brunswick’s Bathurst mining camp, Osisko is focused on drilling and developing the Key Anacon project. The area hosts zinc-lead-copper-silver-bearing sulphide mineralization, host-rock types, and alteration similar to the Brunswick No. 12 and Brunswick No. 6 stratiform zinc-lead sulphide mineralization, also known as the “Brunswick Belt.” In February, the company reported a maiden resource for its wholly owned Eastern Bathurst mining camp project (including the Key Anacon and Gilmour South deposit). The project contains 1.96 million indicated tonnes grading 5.77% zinc, 2.38% lead, 0.22% copper and 68.9 grams silver, and 3.85 million inferred tonnes grading 5.34% zinc, 1.49% lead, 0.32% copper and 47.7 grams silver.

The company owns 420 sq. km in Quebec covering 12 grassroots zinc targets. It has the option to earn 100% of the Quévillon base metals project, west of Osisko Mining’s Urban-Barry claim group.

SHERRITT INTERNATIONAL

Sherritt International (TSX: S) is one of the world’s largest producers of nickel from lateritic sources, with operations in Canada, Cuba and Madagascar. Nickel accounted for 50% of the company’s combined revenue in 2018, with its Moa joint venture in Cuba, and its Ambatovy joint venture in Madagascar having a combined capacity to produce more than 80,000 tonnes of nickel a year. Sherritt also produces cobalt as a by-product of its nickel mining operations, and is a top-10 producer of the finished metal. Sherritt’s finished cobalt has a 99.9% purity, which exceeds the current London Metals Exchange specification. The company augments its core metals business with oil, gas and power operations in Cuba.

The Moa joint venture — 50% owned by Sherritt and General Nickel Co. S.A. of Cuba — uses open-pit mining to mine lateritic ore, which is processed using high-pressure acid leaching on-site into mixed sulphides containing nickel and cobalt. The mixed sulphides are moved to Fort Saskatchewan, Alta., where they are refined into high-quality finished nickel and cobalt, as well as a by-product ammonium sulphate fertilizer. In addition, Sherritt has wholly owned ammonia, ammonium sulphate fertilizer, sulphuric acid and  utilities operations in Fort Saskatchewan.

Sherritt’s Ambatovy open-pit mine produces nickel and cobalt, 80 km east of Madagascar’s capital, Antananarivo. From the mine, the slurried laterite ore is delivered via pipeline to a processing plant and refinery south of the Port of Toamasina. Sherritt owns 12% and operates the joint venture, and its partners include Sumitomo and Korea Resources.

ZINC ONE

Vancouver-based Zinc One Resources (TSXV: Z; US-OTC: ZZZOF) is focused on zinc projects in north-central Peru, and its key assets are the past-producing Bongara zinc mine and the Charlotte–Bongara zinc project, 6 km to the northwest. It acquired the Peruvian assets in June 2017 — the first time the two assets have been controlled by a single operator. The Bongara zinc mine, discovered in 1974, was in production as an open-pit mine from 2007 to 2008, but shut down due to the global financial crisis, and the ensuing drop in the zinc price. Past production included zinc grades over 20%, and recoveries higher than 90% from surface and near-surface, non-sulphide mineralization.

Zinc One released an initial resource estimate for Bongara in February 2019, consisting of 812,000 indicated tonnes averaging 18.9% zinc at a 10% cut-off grade for 339 million contained lb. zinc, and 1.34 million inferred tonnes grading 16.8% zinc for 496 million contained lb. zinc.

In May, Zinc One signed a binding term sheet with InCoR Zinc and InCoR Holdings to form a joint venture to advance the Bongara mine project and Charlotte–Bongara. Under the agreement, InCoR Zinc will earn up to an 80% stake in the joint venture. InCoR is a venture capital investor in the resource sector focused on developing and commercializing mineral-processing technologies.

Charlotte–Bongara has multiple at-surface, high-grade drill intercepts. Highlights include 29.5% zinc across 16 metres and 26.1% zinc across 12 metres.