Newly public Group Eleven Resources (TSXV: ZNG) has started drilling its 60%-owned Ballinalack zinc property, 50 km west of Boliden’s (STO: BOL; US-OTC: BDNNF) Navan zinc mine in the Republic of Ireland. The property is one of several that Group Eleven could explore this year for zinc.
Ballinalack is a joint venture with Chinese mining company Shenzhen Zhongjin Lingnan Nonfemet. It has three known mineralization pods, which form a historic resource estimate pegged at 7.7 million tonnes grading 6.3% zinc and 1% lead based on a 1991 feasibility study by Oliver Resources. Oliver, however, only included the main pod in its 1991 mine plan. Group Eleven CEO Bart Jaworski sees the other two pods as potentially low-hanging fruit.
“However, that’s all secondary to the Navan-style target underneath the historic estimate,” he says in a telephone interview with The Northern Miner.
Navan is the fifth-largest zinc deposit in the world, and the largest in both Europe and Ireland, weighing in at 100 million tonnes grading 10% zinc. One of the exciting things about Ballinalack for Jaworski is that it has Navan-style pale beds beneath its already drilled, Waulsortian-hosted mineralization. He says Group Eleven realized when it looked at the property that no one had tested beneath the Waulsortian for mineralization.
According to Jaworski, Waulstortian limestones host most of the zinc deposits in Ireland. Boliden’s Navan is an exception, where the Waulsortian fades out in favour of pale beds.
“This is what makes Ballinalack special compared to other zinc occurrences in the country,” Jaworski says. “We’re in this Goldilocks zone where we have both prospective horizons.”
Group Eleven will test Ballinalack’s pale beds with its first drill hole this year. It’s looking to see what happens where the pale beds meet the Ballinalack fault. With the Waulsortian zone, zinc deposits only occur right at the Ballinalack fault. Group Eleven hopes to find the same morphology where the Ballinalack fault intersects the pale beds.
Group Eleven formed in early 2015 and looked for land using an Irish government database called Goldmine. Two years later it attracted MAG Silver (TSX: MAG; NYSE-AM: MAG) as a strategic investor.
“That allowed us to credibly talk to other companies, like Teck,” Jaworski says.
He says a lot of majors were dropping land in Ireland at the time, and, through this confluence of factors, Group Eleven acquired Teck’s Ballinalack and Stonepark zinc properties.
The junior’s 1,200 sq. km Stonepark zinc property is located in the Limerick basin and contiguous with Glencore’s Pallas Green, an undeveloped zinc project that hosts 44 million tonnes grading 8% zinc. Group Eleven has a 76.6% interest in the property, with the rest owned by Connemara Mining (LON: CON).
“The main mineralizing structure in the Limerick basin is not yet found,” Jaworski says. “So this is the alluring part of the camp. There’s a big mystery to be solved here: where is the main plumbing system?”
The company plans to carry out drilling over the next few weeks to test for bleeders or feeders into the main system. It wants to run seismic tests at Stonepark as well, but lacks the funding. Before going public the company had attempted to raise $10 million, but could only get $5 million. With that it could drill as much as 11,000 metres, but with other costs to consider, it likely won’t.
Jaworski says drilling will be “very iterative and success contingent.” He wants to drill holes at Ballinalack and Stonepark and study the results before determining where to drop future holes.
“It’s going to be very much a rifle approach as opposed to a shotgun approach,” he says.
The company also has two other zinc properties: Silvermines and Tralee. Silvermines is near the Silvermines zinc mine, which was exhausted in 1982. Tralee is located in the southwestern part of the country and was the first property the company staked in Ireland. Jaworski says it’s located in “one of the most overlooked parts of the Irish ore field.” It will become a focus for Group Eleven in the later parts of 2018.
“The rule of thumb in Ireland for a zinc deposit is 10 and 10,” Jaworski says. “10 million tonnes at 10%. The reason you can get away with 10 and 10 in Ireland is because you have roads everywhere, you have power everywhere, and you’re very close to tidewater.”
The Fraser Institute ranked Ireland #1 for the fifth year in a row in terms of policy attractiveness on its annual survey of mining companies. Jaworski says Group Eleven used this as a selling point to attract financing before the company went public.
“Ireland is not only top-notch geologically, but politically and from a policy perspective, as well,” he says. “It really punches above its weight.”
On the Fraser Institute’s overall investment attractiveness index, Ireland has risen to fourth place, up from ninth in 2016.
Group Eleven went public in December 2017. Shares of the company are valued at 20¢ within a 52-week range of 20¢ to 40¢. The company has a $7-million market capitalization.
“If you look at the reserves of Navan, there are probably only five or six years left,” Jaworski says. “So there’s a big push to find zinc deposits in the country.”