Alicanto Minerals (ASX: AQI) is set to acquire the Naverberg and Oxberg volcanogenic massive sulphide (VMS) projects in Sweden’s south where rock chip sampling has revealed up to 26.1% zinc 11.9% copper, 5.4% lead and 16 grams per tonne silver.
Commenting on the acquisition, Alicanto chairman Didier Murcia pointed out the projects were located in Sweden’s Bergslagen mining district, which hosts high-grade VMS deposits such as Garpenberg, Zinkgruvan and Falun.
Garpenberg has a resource of 168.5 million tonnes at 3.4% zinc, 1.6% lead, 0.3g/t gold and 98g/t silver, while Zinkgruvan’s estimate totals 46.9Mt at 9% zinc, 2% copper, 3.6% lead and 78.7g/t silver.
Alicanto’s newly acquired projects abut the historic Falun mine that produced 500,000t of zinc, 400,000t copper, 160,000t lead, 380t silver and 55t of gold.
Mr Murcia explained the underexplored Naverberg and Oxberg projects were selected following a detailed review of the region by consultant geologists with more than 25 years’ experience.
Naverberg and Oxberg also host 45km of prospective VMS strike.
Naverberg and Oxberg VMS projects
In an area known for its zinc, lead, silver, copper and gold prospectivity the Naverberg project has numerous walk-up ready drill targets.
Naverberg hosts the historic Skyttgruvan mine which produced about 12,300t of zinc at 35-42% zinc, as well as 1,300t of copper.
The mine remains untested below its 200m depth.
Rock chips from the asset have assayed at 26.1% zinc, 8.8% zinc and 2.4% copper.
The project also hosts several untested gravity anomalies that are similar to other VMS deposits and mines in the area.
Meanwhile, Oxberg has produced rock chips of 9.4% zinc, 11.9% copper, 5.4% lead and 16g/t silver.
Previous historic drilling at the project returned 2.8m at 4.7% zinc, 2.2% lead and 89g/t silver and 3.4m at 2.5% zinc, 1% lead and 11g/t silver.
To-date, both Naverberg and Oxberg have undergone little modern exploration.
Once the purchase has been given the go ahead, Alicanto will immediately begin compiling data, field mapping, and surface geochemical sampling, with a drilling program pencilled in to begin in the latter half of the year.
Agreement terms and rationale
Under the acquisition terms, Alicanto will have six months to spend $500,000 on exploration at the projects to determine whether it will exercise the option to acquire 100% of the assets.
If Alicanto proceeds with the acquisition, it will pay the vendors 30 million fully paid shares and a 2.5% net smelter return royalty on any zinc produced.
To fund initial exploration, Alicanto will raise $1 million via a fully underwritten placement of 40 million shares at $0.025 each.
Alicanto’s rationale for the acquisition is to take advantage of the tight zinc and copper market fundamentals with zinc stockpiles currently at their lowest since 2007 and copper at its lowest since 2014.
“Alicanto believes that the time is right to maintain its gold focus, but to also diversify into those metals which are primed to increase after a period of depressed prices,” the company stated.