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
Openpit mining has started at the Oposura project.

Ore processing will start in September under a toll treatment agreement with a third-party sulphide flotation processing plant.

The operation will enable Azure to realise early cash flow that will help fund the ongoing feasibility study, which will ultimately lead Oposura to full-scale production.

Openpit mining will continue throughout July and August, with the underground mining contractor expected to mobilise to the site in August to start Phase 2 mining.

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.