Metco one study closer

A prefeasiblity study for Metco Resources’ (MKO-V, MTKOF-O) Caber and Caber North zinc-copper deposits in Matagami, Que., found the project would generate a net positive cash flow of nearly $20 million with an internal rate of return of 30.3%.

But Metco president Florent Gauthier is waiting until he has a second prefeasibility study in his hands for the Orphe zinc-copper project, at Lebel-sur-Quvillon to the southeast, before he makes any decisions beyond drilling. The second study for Orphe is due in August.

Metco owns 100% of the Caber and Caber North project and has a 50% interest in Orphe, with Breakwater Resources (BWR-T, BWLRF-O) holding the remainder.

“The prefeasibility study is an earmark for production,” Gauthier says. “But we need a feasibility study and we need to do more drilling.”

For both projects, milling would be done at Breakwater’s Langlois mill, in Lebel-sur-Quvillon, at a rate of 1,000 tonnes per day.

Caber has a probable reserve of 589,000 tonnes grading 8.58% zinc, 0.84% copper, 8.89 grams silver per tonne and 0.13 gram gold, which was calculated based on a lower indicated resource of 494,000 tonnes grading 10.9% zinc, 1.1% copper, 11 grams silver and 0.15 gram gold per tonne.

The inferred resource for Caber is 171,000 tonnes grading 8.4% zinc, 1.3% copper 11 grams silver and 0.17 gram gold.

The project would have a life of 25.5 months, with construction taking 15 months.

Ore would be shipped 38 km by truck and 110 km by rail to the Langlois mill.

Gauthier says the Caber deposit will be the focus of drilling this fall because it is shallower (1 to 300 metres) than Caber North and has the indicated resource status.

Caber North needs to be drilled from underground, starting at the 350-metre level.

Metco shares remained unchanged at 13 apiece on the news on trading volume of 1.3 million shares.

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