Venturex Resources (ASX: VXR) has uncovered more high-grade zinc at its Sulphur Springs project in Western Australia including a 20m wide intersection.
Situated about 144km south east of Port Hedland, drill results revealed zinc grading up to 20.8% and an extensive intersect of 20m grading 12.05% zinc.
“The results from hold SSD094 are of particular interest,” Venturex executive director Anthony Reilly said.
“While most of the holes to date have hit predominantly high-grade copper mineralisation, this is the first time we have encountered significant widths of high-grade zinc.”
He added the pending assays will help the company better-understand if this intercept is the start of a more “significant zinc zone extending to the west,” or a localised event.
Other drill holes hit “significant widths” of semi-massive to massive sulphide mineralisation.
Mr Reilly said this “suggests the mineralisation may be laterally more extensive than originally thought, potentially opening up new areas for exploration to the west.”
Sulphur Springs contains six advanced copper and zinc targets. A value engineering study was finalised in February that provided a base case for Sulphur Springs.
The study revealed a 1 million tonne per annum operation that could produce 32,000tpa of zinc and 12,000tpa of copper for 12 years.
The operation was valued at A$601 million (pre-tax) with capital payback doable within 1.6 years.
Early last month, Venturex reported thick and high-grade copper up to 5.98% had been intersected at the project. Narrower copper was also identified grading between 3.49% and 9.31%
Zinc market movements
The zinc market has been enjoying a bit of a revival in recent months as demand outstrips supply.
The zinc cash price on the London Metals Exchange was US$3,241 per tonne on 13 November, which is lower than the US$3,330 per tonne high on the first of the month, but still substantially higher than this year’s biggest low of US$2,434 per tonne in early June.
Several analysts believe the zinc market has bullish fundamentals. At its October meeting, the International Lead and Zinc Study Group published data revealing global zinc had a 287,000t shortfall in the first eight months of 2017.
Zinc major Teck Resources claims 4.3 million tonnes of additional zinc was required to meet demand by 2025. According to the miner, the current zinc pipeline is insufficient to meet this requirement.