THE INSIDE STORY: Azure Minerals (ASX: AZS) has commenced mining operations at the company’s 100 per cent-owned Oposura zinc-lead-silver project, located in Sonora, Mexico.
Azure Minerals is mining easily accessible, high-grade mineralised material, from which it anticipates achieving monthly production of between 1,500 tonnes to 3,000 tonnes at grades between 10 per cent to 15 per cent combined zinc and lead.
All mineralisation to be mined is classified as Indicated Mineral Resources.
Azure said it anticipates starting to process this ore in September under a toll treatment agreement with a third-party sulphide flotation processing plant.
The subsequent delivery of positive cash flow to the company will support the ongoing Feasibility Study into a full-scale mining and on-site processing operation and provide general working capital.
“We acquired Oposura in August 2017, and to be commencing an early-stage, low-cost, high-grade mining operation within 24 months is a great achievement,” Azure Minerals managing director Tony Rovira said.
“This operation allows Azure to realise early cash-flow that will help fund the ongoing Feasibility Study, which will ultimately see Oposura in full-scale production.”
Oposura is a relatively small-scale mining operation, focused on mining easily accessible, high-grade, massive sulphide mineralisation from the project’s East Zone Mineral Resource.
Azure is to undertake the mining in two phases, initially by open pit, which is currently in progress, to be followed by underground extraction.
During July, Azure mobilised an open pit mining contractor to the Oposura site.
Work completed to date includes refurbishing of an approximately six-kilometre-long access road between the main highway and the mine site, prestripping overburden from above the massive sulphide horizon, grade control drilling, and mining and stockpiling of ore.
Phase 1 mining is removing, via open pit, fresh massive sulphide mineralisation situated on the eastern side of the East Zone mineral resource.
Mineralisation in this area occurs within five metres of surface and in some places is already fully exposed.
Overburden consists of weathered rock which is being stripped by bulldozer with no drilling and blasting required, ensuring low mining costs.
Since mining started, over 1,200 tonnes of ore have been excavated and stockpiled.
Based on mineral resource drilling within the mined area, where hole spacing is approximately 25m by 25m, the grade of this material is estimated to be between 10 per cent and 15 per cent combined zinc and lead.
The mineralised horizon of massive sulphides ranges in true thickness between one and four metres.
Open pit mining is expected to continue throughout July and August with several thousand tonnes of high-grade ore expected to be produced.
The western wall of the open pit will be cut back to enable access directly into the historical Tunnel D drive.
The underground mining contractor should mobilise to site in August to commence Phase 2 mining.
Initially, a portal will be established in the western wall of the open pit to access the Tunnel D drive which will then be side-stripped to provide 3m by 3m mechanised access to the western high-grade zone.
Underground mining will be carried out by the room and pillar method to ensure maximum ore recovery while minimising dilution.
Ore transport to the San Javier flotation plant will start in August and processing under the toll treatment arrangement is expected to commence in September.