JOHANNESBURG (miningweekly.com) – Base metals developer Ironbark Zinc is continuing to work towards securing Chinese funding for a large potential zinc mine – the Citronen base metals project, in Greenland.
Ironbark, which is listed in Australia, is working with China Nonferrous Metal Industry’s Foreign Engineering and Construction Company (NFC) to access Chinese funding for the project.
NFC has a memorandum of understanding with Ironbark for the potential funding and construction of the Citronen project, targeting 70% of the project financing through debt and an option for a further 20% of the project financing through direct project investment.
Ironbark reported that it recently hosted a site visit to the project to introduce Greenland government officials, including Mines Minister Mute Bourup Egede and Deputy Minister Jorgen Hammeken-Holm, to NFC’s team.
“The site inspection provided a solid understanding around the construction requirements and operating conditions for the project,” the developer said in a project update issued on ASX.
NPC is preparing a project study report and is updating the Citronen feasibility study to incorporate Chinese equipment and construction costs. The site visit forms part of this work.
Australian engineering contracting group CPC Project Design is working with NFC on the Citronen project.
Ironbark said that falling zinc stock and a rallying price provided a “very supportive” financing environment. The company pointed out that zinc had risen to the highest level in almost ten years of $2 965/t, while stockpiles were at new multiyear lows.
“This is a very exciting time to be moving as one of the largest zinc projects in the world towards production,” the company said.
The Citronen project has an open-ended resource of 12.8-billion pounds of zinc.
The 2013 feasibility study, which is now being updated, confirmed Citronen as a large-scale, long-life project with an expected mine life of 14 years during which it will generate revenue of $5.65-billion. The 2013 study estimated that Citronen will cost $429.3-million to build.