Name of the Project
Oposura zinc/lead/silver project.

Location
The project is located in Sonora, Mexico.

Project Owner/s
Azure Minerals.

Project Description
A scoping study has confirmed the Oposura project as economically and technically robust and high-margin. It states that the most suitable and economical mining methods comprise low-unit cost, openpit and room-and-pillar underground extraction methods.

The optimal mining rate will be about 500 000 t/y from a combination of openpit and underground mining operations, at life-of-mine (LoM) average grades of 4.6% zinc, 2.6% lead and 15.9 g/t silver, delivering an initial LoM of 5.3 years.

The processing flowsheet comprises two-stage crushing. This will be followed by ore sorting using dense-medium separation to reject waste material and feed an upgraded product to the milling and flotation circuit at an estimated 300 000 t/y at LoM average grades of 7.5% zinc, 4.1% lead and 24.5 g/t silver.

The plant will produce about 35 000 t/y of zinc concentrate and 16 000 t/y of lead concentrate containing about 19 000 t of zinc and 10 000 t of lead. The yearly production of lead concentrate will contain an estimated 145 000 oz of silver.

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 A$112-million and an internal rate of return of 76%, with a payback of about 16 months.

Capital Expenditure
Preproduction capital is estimated at A$69.9-million, including capital contingency of 25%.

Planned Start/End Date
First production is expected in late 2020 or the first quarter of 2021.

Latest Developments
Azure Minerals has announced that its board has approved the start of trial mining and the processing of high-grade mineralisation from the Oposura project.

Operations will start in the September quarter and will be funded through A$2-million in financing that Azure has secured from major shareholder Deutsche Batalon.

The mine production and processing rate will initially be between 1 500 t/m and 3 000 t/m, grading about 15% combined zinc and lead with ore processed on a toll treatment basis through a nearby sulphide flotation processing facility.

Azure has noted that there is scope to increase the mine production rate if additional processing capacity becomes available.

“With minimum upfront capital required, this trial mining operation will provide early positive cash flow and Azure will start to realise value from the asset. Generation of this cash flow will assist in funding completion of the feasibility study and meeting other corporate expenses,” MD Tony Rovira has aid.

Key Contracts and Suppliers
CSA Global (mine design and sequencing).

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Azure Minerals, tel +61 8 9481 2555, fax +61 8 9485 1290 or email admin@azureminerals.com.au.