Name of the Project
Ayawilca zinc project.

Location
The project is located in Peru, in one of the world´s most prolific polymetallic belts.

Project Owner/s
Tinka Resources.

Project Description
A preliminary economic assessment (PEA) has concluded that the Ayawilca zinc project is possibly one of the best new zinc development projects in the Americas, with strong economics and a long mine life of more than 20 years.

The PEA is based on an underground mine operation 5 000 t/d for a mine life of 21.1 years.

The initial mine plan is based on mining 8.4-million tonnes indicated resources grading 6.95% zinc, 0.18% lead and 15.8 g/t silver, and 29.8-million tonnes of inferred resources grading 5.79% zinc, 0.27% lead and 19.0 g/t silver over the life-of-mine.

Room-and-pillar and post-pillar mining methods will be used.

The zinc-rich mill feed will be trucked to the surface by a one-way-traffic ramp system connecting two mine portals to the underground infrastructure and accessing production areas starting at West and South Ayawilca.

Processing of the zinc mineralisation will be through a standard crushing and grinding circuit followed by froth flotation, concentrate thickening and filtration. The mine operation will produce zinc and lead concentrates.

About half of the tailings will be thickened and sent to a surface tailings storage facility, while the remainder will be mixed with cement and used as structural backfill in the underground operations.

The PEA indicates average production of about 101 000 t/y of zinc recovered in concentrate and about 906 000 oz/y of silver in a silver/lead concentrate.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of $609-million and an internal rate of return of 37.2%, with a payback of 2.2 years.

Capital Expenditure
Initial capital expenditure is estimated at $262-million.

Planned Start/End Date
For the purposes of the PEA, production is assumed to start in 2023, following 18 months of construction and commissioning.

Latest Developments
Based on the positive initial PEA, the Tinka intends to continue to advance the Ayawilca project towards production.

This will include:
• continuing exploration drilling to expand the zinc zone resources, especially in high-grade areas.
• obtaining the required permits for infill drilling to support a prefeasibility study, which has begun and is expected to take the remainder of 2019.

Further expansion of the drill permits will be required in 2020 to test exploration targets outside the current drill permitted areas.

• the completion of optimisation studies to evaluate potential economic improvements, including higher metallurgical recoveries and a reduction in the iron content in the zinc concentrate.
• undertaking additional geotechnical data analyses to evaluate more advanced mine planning studies, including potentially higher mine throughput options than contemplated in the PEA.
• the completion of technical and marketing studies to evaluate how additional value may be derived from indium as part of a future mining operation, as high indium grades in the zinc concentrate represent a potential value-add. Limited value was, however, applied in the PEA for the mineral.
• the completion of mineralogical and metallurgical studies on the tin zone resources to evaluate the economic potential of these resources.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Tinka Resources, email info@tinkaresources.com.