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NEW YORK, NY–(Marketwired – Feb 21, 2014) – Zinco do Brasil Inc. (OTCQB: ZNBR) (the “Company”), a mine development company focused on bringing into production an advanced stage zinc and lead project in Brazil, is pleased to inform its shareholders with a project update.
Split of Porteirinha Project into Gorutuba and Tocandira Blocks
During the Company’s soil sampling work at the targets located in the North portion of the Porteirinha Project the presence of banded iron formations were recognized in the area. These new formations were grouped together as the Tocandira Block. The development and results of the conducted geological research at the Gorutuba and the newly identified Tocandira targets lead the Company to separate said targets into two blocks; the Gorutuba Block and the newly created Tocandira Block.
Zinco do Brasil, Ltda. now has 43 tenements covering a total area of 67,704.93ha are subdivided as follows:
Salobro Project – 2 tenements covering 1,209.75ha;
Gorutuba Target – 19 tenements covering 31,296.81ha;
Tocandira Target – 22 tenements covering 36,408.12ha.
Tocandira Soil Geochemical and Field Research Results
The Tocandira Block landscape is composed of a flat plain area with rare scattered rolling and high hills. The flat plain area is broadly covered by recent unconsolidated sediments, whereas the underneath Precambrian bedrock is exposed only in the hills.
The geochemical soil sampling program was carried out in nine areas with a total of 1545 samples collected and analyzed in 2013.
The geological context of the Gorutuba and Tocandira Blocks are very different. In the Gorutuba Block the magnetic anomalies are covered by the neoproterozoic rocks of the Macaúbas group, whereas only unconsolidated rocks cover the rocks of the basement in the Tocandira Block.
The geochemical campaign confirmed some zinc, lead and copper anomalies but the geological scenario is responsible for the low results of the soil geochemical sampling, since the unconsolidated sediments prevent the direct assessment of the rocks that generated the aeromagnetic anomalies. The next phase of the exploration program will be revised considering all results from the aeromagnetic and the geochemical studies.
The fieldwork also revealed some interesting and promising occurrences of banded iron formations and provided material information for the Company’s preliminary DNPM (“The National Department of Mineral Production”) reports. The geological research strategy will be redirected to ground geophysical investigations which is planned for 2014.
The Banded Iron Formations identified in the field were classified as itabirites in the petrographic descriptions and their chemistry showed an iron content ranging from 33% to 41% Fe and very low content of phosphorous (less than 0.07% P).
Seven tenements were object of the Company’s preliminary reports presented to DNPM last year in the Company’s efforts to receive an extension allowing the Company to conduct more research. The filed preliminary reports have been approved and granted by the DNPM.
New Metallurgical Tests at Salobro Successful
The Company decided to revisit and conduct additional metallurgical tests for its Salobro ore. Representative samples were collected from the existing core yard and extensive metallurgical testing was completed without the use of sodium cyanide to confirm VALE/CETEM´s study conducted in 2002. The results confirmed that the Company can forgo the use of sodium cyanide as a standard extraction method for the future mine plant with concentrate grades greater than 50% of zinc.
Filing of Economic Mining Plan for Salobro Project
As required by the Brazilian mining laws and regulations the Company presented and filed its economic mining plan (“Plano de Approveitamento Economico – PAE”) for its Salobro project to DNPM on January 15th2014. The Company is awaiting DNPM’s review and expects to receive approval of its mining permits for the Salobro project under the Brazilian Mining Code.
About Zinco do Brasil, Inc.
Zinco do Brasil is a publicly listed company (ZNBR). The Company is in the process of acquiring 99.9% of Zinco do Brasil Mineracao Ltda., which owns 43 Mineral Rights for a total of 67,705 hectares in the Brazilian state of Minas Gerais. The Mineral Rights of Porteirinha Project are split between three blocks: Salobro, which consists of 2 mining rights for an area of 1,210 hectares, Gorutuba covering 31,297 ha in 19 tenements and Tocandira with 22 mining rights for an area of 36,408 hectares.
The Company expects the Salobro historic mineral resources to increase by 30 – 50% during the exploration drilling program scheduled for Q2 and Q3 of 2014. The results of the drillling will be incorporated with the existing drill data to prove up the historic zinc and lead mineral resources to NI 43-101 standard. Salobro is planned to go into production in Q4 of 2016 and to produce in excess of 30,000 metric tons of zinc and 5,000 metric tons of lead per year during the currently estimated mine-life of 10 years (13 – 15 years after anticipated mineral resource increase of 30 – 50%).
The Gorutuba block consists of 19 mining rights containing an area of 31,297 hectares in total. Geophysical interpretation of the area was developed based on ground geophysical data acquired by Vale and by magnetic data gained from airborne geophysical survey conducted by the State of Minas Gerais. The studies revealed that the geophysical characteristics of the Salobro deposit are highly correlated with seven targets within the Gorutuba block area, showing similar anomalies like Salobro. The aerial extent of the seven selected targets is 17 km (compared to 2.35km of Salobro) and a drill program is scheduled to start during 2014-2015 to confirm each deposit. Initial geochemical surveys indicated other anomalies of copper and gold within the Gorutuba projects/targets.
The Tocandira block consists of 22 mining rights for an area of 36,408 hectares. During the geochemical work in 7 blocks Zinco’s field team discovered an iron mineralization. After in-depth analysis of the underlying aeromagnetic database available, the Company decided to file applications for 15 additional mining rights.
Forward-Looking Statements
Certain statements in this news release are forward-looking statements. Words such as “expects”, “intends”, “plans”, “planned”, “proposes”, “may”, “could”, “should”, “anticipates”, “estimates”, “likely”, “possible”, “potential”, “believes” and words of similar import may identify forward-looking statements. Such statements are based on management’s and the Company’s independent mining consultant’s current expectations, estimates and projections about the companies’ businesses, are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. Actual results could vary materially from the description contained herein due to many factors beyond the control of the Company, including, but not limited to, the successful completion of the merger; the combined company’s ability to raise the required additional capital to develop its mining assets and to identify other acquisition and/or joint venture opportunities in the mining sector, and to establish the technical and managerial infrastructure necessary to take advantage of, and successfully participate in, such opportunities; future economic conditions; demand for zinc and other minerals the company may seek to extract; political stability; and changes in governmental regulations, and financial capabilities of the Company. Additional information on risks and other factors that may affect the business and financial results of Zinco do Brasil and the combined company can be found in filings of Zinco do Brasil with the U.S. Securities and Exchange Commission. The Company encourages any current or potential shareholder to read all the public filings before making a decision to invest in the shares of any public company.
The information provided in this news release may contain forward-looking statements within the definition of the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. These statements are based on Zinco do Brasil Inc.’s current expectations and beliefs and are subject to a number of risks and uncertainties that can cause actual results to differ materially from those described, including but not limited to, the results from the start up activities and ongoing production potential of Salobro Zinc Project. Readers are cautioned to review the risk factors identified by the company in its filings with US securities agencies. Forward-looking statements are based on management’s expectations, beliefs and opinions on the date the statements are made. Zinco do Brasil, Inc. assumes no obligation to update forward-looking statements if management’s expectations, beliefs, or opinions, or other factors, should change.