Vancouver — EuroZinc Mining (EZM-V) has inked a deal with the Portuguese government owned mining company, Exmin, to acquire its 25% interest in the Malhadinha exploration concession. The concession surrounds the Aljustrel mining lease that hosts the Aljustrel zinc-copper deposit.
In return for transferring its interest in the concession, Exmin will receive a 1.5% net smelter return should the concession reach the commercial production stage. The net smelter return will be paid after EuroZinc earns back its initial capital investment to bring a deposit on the concession into production. EuroZinc will also transfer its 75% interest in the Malhadinha concession, held through a Portuguese subsidiary, into the Aljustrel operating company, Pirites Alentejanas (P.A.).
The Malhadinha concession covers 77 sq. km and is host to the Estacao polymetallic massive sulphide deposit plus numerous gravity anomalies. These anomalies are coincident with stratigraphy that is similar to the rocks that host the Aljustrel deposits.
Eurozinc now has complete control of the Malhadinha concession, in addition to ownership of the known resources and reserves of the Aljustrel mining lease. Late last year EuroZinc purchased a controlling interest in P.A. for US$5.4 million.
Proven and probable reserves at the Feitais deposit’s zinc-rich zone are estimated at 12.2 million tonnes grading 5.67% zinc, 0.22% copper, 1.77% lead and 64.15 grams silver. Reserves in the deposit’s copper-rich zone are pegged at 1.6 million tonnes of 2.16% copper, 0.97% zinc, 0.27% lead and 14.26 grams silver.Proven and probable reserves at the Moinho deposit stand at 1.6 million tonnes grading 4.48% zinc, 0.54% copper, 1.78% lead and 53.47 grams silver.
Resources at Feitais total 18.4 million tonnes of 6.02% zinc and 6.7 million tonnes of 2.12% copper, while resources at Moinho total 5.9 million tonnes of 4.7% zinc and 2.2 million tonnes of 1.93% copper.
The project has an after tax internal rate of return of 29.4% with a US$0.51 per pound zinc price.
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