VANCOUVER — A common tale amongst grand old communist regions is the historic state-run mine that now lies in disrepair following the blossoming of democratization and liberalization in parts of Eastern Europe. International explorers like Global Minerals (CTG-V) are now looking at these historic mining jurisdictions as opportunities, where existing infrastructure and exploration records can offer capital savings and the ability to quickly kick-start operations.
Global has targeted an area in eastern Slovakia that has a mining history dating back to the Middle Ages. Just outside the small town of Roznava lies the now defunct Maria iron-ore operation that was run by the Czechoslovakian government from the end of World War 2 through the mid-1990s. According to director and CEO Bill Pincus; however, it was not the potential for iron that drew Global to the project.
“The principle mineral that they were mining was siderite, which is iron carbon,” explains Pincus during an interview. “The main mineralogy is a quartz-siderite-tetrahedrite. It’s the tetrahedrite that carries the copper, gold, and silver. Going back to the regional political period, steel is what they were making and they needed the iron ore. There are some sketchy records of a bit of copper-silver extraction, but it was basically just iron mining.”
Underground iron-ore extraction focused almost exclusively on a main vein called Maria, though later in the mine’s life a number of exploration initiatives were undertaken that eventually resulted in the discovery of Global’s main target: the Strieborna vein.
Located roughly 500 metres from Maria, the Strieborna deposit carries a measured and indicated resource totalling 1.9 million tonnes grading 232 grams silver per tonne, 1.1% copper and 0.7% antimony for 14.3 million oz. contained silver, 48 million lbs. contained copper, and 29 million lbs contained antimony.
“What they did as part of an exploration program is follow an exploration drift perpendicular to Maria and intersected a number of other veins, including Strieborna,” Pincus comments. “They recognized a greater concentration of tetrahedrite, and so it was explored through the 1990s underground. There is something like 3,000 metres of footwall drift on this deposit, and they even test mined around 30,000 tonnes before low prices at the time forced a shut down.”
Historic operations have left Global with a bevy of infrastructure opportunities, including on-site offices, access to power and water, as well as 3,000 metres of underground development and a 1.6-km haulage tunnel. Nearby Roznava also has a rich mining history and offers access to skilled labourers and technicians experienced in underground working conditions.
Pincus says the community radiates optimism about the return of mining to the region, with turbulence from the Eurozone crisis triggering a spike in unemployment.
“It’s really turned out to be gratifying in regards to the local economy, and there are a lot of skilled contractors, good underground drillers and miners,” he explains. “We’re dealing with knowledgeable regulators on-site that understand underground operations. We’re going to find out in regards to permitting — it is the European Union and there are established standards and norms that have to be met. Having said that no one has permitted a metal mine recently, so that’s another issue.”
A separate issue involves draining the underground infrastructure and tunnel systems, which were flooded following the mine’s closure. Due to Strieborna’s inaccessibility the company has been forced to rely on surface drilling and historic data, but is closing in on a 200-metre drainage target that would allow it to enter Maria’s sixth level, thereby providing underground access to Strieborna via an available cross cut.
“Our intention is to start with bulk sampling and re-establish underground drill stations as we refurbish the mine, eventually aiming for reserve upgrading and reserve extension,” Pincus says, outlining Global’s plans. “There’s quite a bit of infrastructure on surface. We rehabilitated and installed some industrial towers so we have power, the hoisting mechanism is being refurbished, and we’ll bring in underground power, water and air as we move down through the two shafts.”
Global is targeting a preliminary economic assessment on its existing deposit by the end of the year, with dewatering and mine rehabilitation expected to wrap up by the third quarter.
The company will have to deal with potential metallurgical issues surrounding its antimony content. Though conventional low-cost flotation processes have demonstrated 96% silver and 97% copper recoveries, carrying antimony in a concentrate results in smelter penalties could affect downstream profitability.
Global is contemplating a more costly hydrometallurgical process that would allow it to strip the antimony and produce a separate saleable metal, though Pincus speculates it is likely the company could develop favorable economics on the deposit even with a smelter penalty on its antimony content.
Though the historic infrastructure and existing resource were a major draw, Global is also optimistic about regional exploration potential, with a large amount of the surrounding area being Greenfield and featuring a series of geophysical anomalies.
“There is just some incredible exploration potential,” Pincus says. “The geologic model that really drew us to the property was the comparison to the mineralogy at the Sunshine silver mine in Idaho.”
Global believes there could be additional resource potential in the Maria I and Maria II veins which lie adjacent to the historic mining area. The company holds roughly 135 sq.km surrounding the Strieborna project area, with documented exploration by the Slovakian authorities recording 90 separate vein occurrences. Global has also found some intriguing gold mineralization during surface exploration, including 18 grams gold per tonne during grab and dump sampling at its Cucma target.
“Though there is no historical record of gold production we’ve found some high-grades during grab sample campaigns,” Pincus comments. “My strong suspicion is that there was gold mining in the region that just wasn’t recorded. We have some surface targets, but it’s pretty wide open and we’ll be focusing on underground exploration initially.”
Global remains cash heavy with roughly US$12 million at presstime. The company believes it should avoid further dilution through production, and maintains 111 million shares outstanding with a $37 million market capitalization.
“We think we have enough money to make it into production, and then look at project-type financing whether that be through equity placements or debt financing or potential royalty and metal streams,” Pincus concludes.
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