Ironbark Zinc feasibility study dubs Citronen globally significant

THE BOURSE WHISPERER: Ironbark Zinc (ASX: IBG) has received the results of a Feasibility Study of the company’s 100 per cent-owned Citronen project in Greenland.


Ironbark’s tenement holding in the Citronen Fjord region. Source: Company announcement


Highlights of the Citronen Feasibility Study include:
–    Net Present Value (NPV) of US$609 million (US$354M post tax);

–    Internal Rate of Return (IRR) 32.0 per cent (22.2 per cent post tax);

–    Equity Return 37.9 per cent (Geared NPV after tax);

–    Capital Cost US$429.3 million including contingency (US$484.8 million with First Fills);

–    Operating Costs of US$0.68 per pound of zinc (Payable, Net of by-product credits, Years 1-5, smelter fees additional US$0.22 per pound of zinc);
–    A Mine Life of 14 years;

–    Life of Mine Revenue US$5.65 billion; and

–    Life of Mine operating costs of US$3.42 billion.

“We are delighted the Citronen project has been ratified as a base metal mining project of global significance,” Ironbark Zinc managing director Jonathan Downes said in the company’s announcement to the Australian Securities Exchange.

“Located in Greenland, a nation actively seeking to foster a mining sector to help support its economy, Citronen’s mine life of at least 14 years is defined only by the limits of drilling to date.

“As such, one of the project’s most exciting aspects remains its exceptional exploration potential with identified mineralisation remaining open in almost every direction.”

The Feasibility Study incorporated a recent review of capital costs and the company’s 2012 updatedResources Statement.

Further advances and improvements, particularly surrounding resource confidence and mine scheduling, were released in 2012 were also included in the Study.

The company said it has achieved recent metallurgical breakthroughs with zinc flotation recoveries of 90 per cent.

Ironbark explained this testwork remains ongoing and as such, the results cannot be included in the Feasibility Study until it has achieved feasibility- level engineering confidence.

The company indicated these higher recoveries will be incorporated into the Feasibility Report following the completion of further studies.